Shale gas: Use it here, or sell it globally?

March 4, 2014

By Drs. Robert and Sonia Vogl
President and Vice President of the Illinois Renewable Energy Association

Just last year, shale gas promoters promised a bright future of stable, low-priced natural gas making it the fuel of choice for homes, utilities and truck fleets. Some advocates claimed it would power our economy affordably for the next 100 years.

Friends recently informed us that although they had a guaranteed price from their propane supplier, they could only get a quarter of their tank filled at that price. Their supplier ran out of low-cost stored fuel, and the new supplies had doubled in price.

As gas supplies dwindled, shiploads of propane headed for export were redirected to American consumers. Congressional delegates from Vermont requested that the U.S. Commerce Department impose a temporary ban on propane exports.

A few years ago , Southcentral Utilities was unsuccessful in their request to ban exporting natural gas, which would deny them the gas needed to generate electricity. Allowing exports hurts domestic consumers, chemical companies, plastic manufacturers and fertilizer producers.

A substantial increase in domestic demand for propane is anticipated when petrochemical facilities come on line in 2017.

Last year’s Annual Energy Outlook from the U.S. Energy Information Administration projected that the United States will continue to be a net exporter of LPG through 2040.

The intense demand for propane could adversely impact energy interests’ growing pressure on Congress to lift the ban on crude oil exports and lessen restrictions on exporting natural gas.

Section 3 of The Natural Gas Act allows the Energy Department to deny a proposed export of gas to an entity that is not part of a free trade agreement if the export “will not be consistent with the public interest.” The Department gives consideration to the domestic need for the gas, whether the export threatens the security of U.S. natural gas supplies and the possible environmental impact of any construction.

High energy prices could also impact acceptance of a new trade treaty now being negotiated, The Transatlantic Trade and Investment Partnership. If successful, it would replace the North American Free Trade Agreement and become the world’s largest free trade area.

Treaty advocates claim removing trade barriers, cutting tariffs and unifying regulations between the EU and the United States would create economic growth and jobs in both countries.

Critics fear the treaty will enhance corporate power and roll back democratically agreed on standards on food and chemically safety, agriculture, energy and labor.

Carl Pope expressed concern that if the treaty is signed, the United States will give away the right to ensure that our households, power plants and factories have first claim on our natural gas resources.

A precedent was set with NAFTA as Canada was prohibited from limiting its exports of natural gas and oil to the United States even in times of national shortages.

Exporting natural gas, while profitable, along with increasing our consumption within our country undermines our energy security and increases environmental deterioration associated with fossil fuel consumption

We need to be accelerating our investments in energy efficiency, wind and solar now to enhance energy security and build a clean, sustainable economy.

Drs. Robert and Sonia Vogl are founders and officers of the Illinois Renewable Energy Association (IREA) and coordinate the annual Renewable Energy and Sustainable Lifestyle Fair. E-mail: sonia@essex1.com

From the March 5-11, 2014 print edition

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