On February 12^th, the Senate’s Committee on Energy & Natural Resources held a hearing entitled “Opportunities and Challenges for Natural Gas.” The major themes of the hearing were that natural gas production techniques have led to an abundance in domestic natural gas supplies, that this abundance provides significant benefits to the U.S. economy, environment and national security, and that policies need to be crafted to preserve these benefits while addressing the challenges simultaneously presented by the abundance of natural gas. Here’s a review:

The revolution in shale gas production from “fracking” has changed the domestic energy paradigm:

 Chairman Wyden (D-OR) said that policies need to be instituted to reflect the new reality of energy abundance from natural gas production, as domestic supply will soon outstrip domestic demand. Ranking Member Murkowski (R-AK) said that export of natural gas can create jobs and have positive effects on the trade balance, but will require additional pipeline infrastructure to connect production to markets.  

The increased usage of natural gas will benefit the environment:

Gov. Hickenlooper (D-CO), who testified before the committee explained that natural gas can be an effective backup for renewables such as solar and wind that carry intermittency and storage problems. He also asserted that natural gas is cleaner than other fossil fuels, and can provide significant environmental benefits if paired with effective monitoring of air and water for leaks. Kenneth Medlock, senior director at the Center for Energy Studies at the James A. Baker III Institute for Public Policy, testified that natural gas usage carries significant environmental benefits over the use of coal and oil. He noted that domestic CO2 emissions are at 1990 levels because of the increased use of natural gas.

The availability of domestic natural gas will benefit the economy:

Andrew Liveris, the Chairman and CEO of the Dow Chemical Company, testified that reasonable and stable natural gas prices are driving a surge in domestic manufacturing and that "continuing optimism for U.S. manufacturing is founded on the prospect of an adequate, reliable and reasonably priced supply of natural gas." He noted that while Dow supports exports and trade, that export levels should be "based on objective criteria and metrics, established through a public process and applied on an incremental, case-by-case basis in a consistent and balanced manner" in order to sustain a U.S. manufacturing advantage.

The availability of domestic natural gas will benefit national security:

Mr. Medlock also testified that increased domestic natural gas production decreased our dependence on major energy producers like Iran, Russia, and Venezuela. Sen. Barrasso (R-WY) noted that he has introduced bipartisan legislation (S. 192) to increase LNG exports to NATO allies that are currently dependent on Russian natural gas and Iranian oil.

States should take the lead in developing policy for natural gas production and export:

Gov. Hickenlooper explained that states should take the lead in crafting policy for natural gas production and export, based on their unique understanding and expertise in local geological and environmental concerns. He said that governors would be eager to compete in crafting the best policy, from which the federal government can craft its own policy to set minimum standards.