U.S. Energy Secretary Jennifer Granholm is 100 percent correct when she talks about the need to "keep the lights on," as she did Monday at the CERAWeek energy conference in Houston. As energy policy goes, Washington has no greater priority than keeping American families and businesses well-supplied with affordable, reliable energy.
That means embracing American natural gas and oil, both of which are produced to some of the highest safety and environmental standards in the world. Together, they accounted for about 70 percent of the energy Americans used in 2022—for transportation, home heating and thousands of products we rely on. Natural gas and oil will continue to be our leading energy sources in the future,—experts project—again, because they have been affordable and reliable in keeping the lights on.
Judging by Granholm's remarks, she appears to recognize that Americans' basic need for affordable, reliable energy—woven into pocketbook issues that matter in an election year—should be a top Washington priority. Passage of the Inflation Reduction Act, with its support for alternative energy sources, is important, but so is recognizing that American oil and natural gas come cleaner and safer than oil and natural gas produced elsewhere.
Let's hope Granholm holds sway within an administration that too often has worked against sound energy policy. Three examples come to mind.
First is Washington telling Americans which vehicle they can drive instead of letting consumers choose for themselves. That is the crux of EPA's new tailpipe emissions rule, which would create a de facto ban on gas-powered vehicles—which more than nine in 10 Americans drive.
In reality, we need a broad range of vehicle technologies, including those that run on gasoline, hybrids, and electric vehicles. What we don't need is Washington picking winners and losers and using rules to limit Americans' vehicle choice. Congress now has to make a decision whether to protect consumer choice, U.S. manufacturing workers and our hard-won energy security by overturning this deeply flawed regulation.
The fact is, America needs more energy sources, not less. Yet, subtraction—not addition—could be the outcome if opponents of natural gas and oil have their way, and if key administration policies continue. Instead, Washington should take an all-of-the-above energy approach, anchored by natural gas and oil.
America's natural gas and oil abundance—the U.S. is the world's leading producer of both, as Granholm noted in the same CERAWeek speech—gives our nation a significant energy edge in the world and is foundational to energy security. It's the realistic approach to America's energy needs today and tomorrow. It's telling that two in three voters in a recent poll said they believe energy policy from Washington is on the wrong track.
Another policy misstep is the administration's recent decision to pause permitting for liquefied natural gas (LNG) that would go to allies abroad. Though officials claim concern about LNG's impact on domestic natural gas prices and environmental effects, neither stands up to scrutiny.
The U.S. Energy Information Administration reported last month that the U.S. Henry Hub benchmark price for natural gas was the lowest in inflation-adjusted dollars since at least 1997—more than 25 years ago! Additionally, new research released this week shows that over the past decade, domestic natural gas prices were 54 percent lower than in the previous decade, and that even with record LNG deliveries during the first six months of 2023, U.S prices hit the lowest six-month average in more than 35 years (outside the COVID-19 pandemic).
The key is that U.S. natural gas producers have shown, time and again, their ability to keep the domestic market well supplied while also sending LNG to help America's allies. Plus, natural gas continues to lead the way in reducing U.S. carbon dioxide emissions from power generation. It's an essential component in the global energy mix.
While Granholm told a CERAWeek audience that the LNG freeze will be in "the rearview mirror" by this time next year, that's too long for America's allies to wait. The LNG freeze should be rescinded as soon as possible so that America's energy leadership isn't constricted by a political power play for votes.
Finally, the administration has fallen short in its stewardship of American energy, justifying its weak record on offshore and onshore leasing because today's oil production is at record levels. Although federal and non-federal production has grown, today's federal production is the result of policy and investment decisions made under previous administrations, not this one.
The administration should rewrite its five-year federal offshore leasing program, which currently has just three lease sales scheduled through 2029 and none this year, to help ensure America's future energy security.
U.S. energy policy is too important to sway this way and that in the political winds of an election year.
As the energy secretary recognized, keeping the lights on is Washington's No. 1 job in terms of official energy policy. Right now, the White House is in the dark.
Mike Sommers is president and CEO of the American Petroleum Institute in Washington, DC.
The views expressed in this article are the writer's own.
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