A market-driven energy revolution
The International Energy Agency has jumped on the U.S. energy bandwagon. In a report released this week, the IEA said the United States will surpass Saudi Arabia as the world’s largest oil producer before the end of the decade and is on track to become energy independent by 2030.
That’s even more optimistic than U.S. government projections made just last month, and a far cry from forecasts of a few years ago, when predictions for U.S. dependence on large amounts of foreign oil extended as far into the future as anyone’s crystal ball could see.
All of this has occurred primarily as a result of market-driven exploration and technological development, especially with advances in hydraulic fracturing and directional drilling, which was pioneered here in western Colorado. The boom is not something driven by the government.
The massive Bakken Field in North Dakota and nearby states, new oil production in places like Colorado’s Weld County, increased production in the Gulf of Mexico and the boost in recoverable natural gas in many parts of the country are all contributing to the newly optimistic U.S. energy forecasts.
This is good news for a country trying to recover from a long-stalled economy. More energy development here means more good-paying jobs and less money being sent to foreign countries that are often antagonistic to the United States. It can also be good news for the environment and for this region.
U.S. carbon dioxide emissions are at their lowest level in 20 years, thanks to the shift occurring from coal to natural gas in electric generation. There is even greater potential to reduce greenhouse gases and use our abundant natural gas if we can convince China and India to switch from coal to gas, according to a column in The Wall Street Journal Monday cowritten by physicist Richard Muller and Indiana Gov. Mitch Daniels.
Of course, the boom isn’t guaranteed. Too much government interference and regulation could kill it or significantly slow it.
That would be foolish for a government that, at least since the days of President Richard Nixon, has proclaimed energy independence as a critical national goal. President Jimmy Carter created the Energy Department and his failed synfuels program specifically with that aim in mind.
The Energy Department can claim some modest success in promoting solar and wind energy, but those sources remain very small players in our overall energy picture.
Private companies and private investors taking risks on new energy fields and new technology are responsible for the massive change in the supply side of the energy equation.
We need to encourage those energy entrepreneurs with responsible regulations. That doesn’t mean abandoning environmental and health protections, but it does mean recognizing the importance of our energy resources and encouraging them, not blocking their development at every turn.