NCPA - National Center for Policy Analysis


May 3, 2005

Americans are angry about high energy prices, so it's the right moment to focus on why those prices are often higher than they have to be. Consider the political campaign against natural gas, which was once plentiful but is now in increasingly short supply because of restrictions on its production and delivery, says the Wall Street Journal (WSJ).

The Sierra Club and the Nader retinue have successfully pushed moratoriums for most new offshore drilling of the fuel, have fought to keep the most gas-rich federal lands off-limits to exploration, and have used lawsuits to tie up those pieces that are accessible. According to the American Public Gas Association, some 213 trillion cubic feet of natural gas is basically off-limits to production. That's a 10-year supply at current demand.

The enviros are also blocking an even quicker path to lower prices: importing more liquefied natural gas, says the WSJ.

  • Currently, less than 1 percent of gas consumed by the United States is LNG, in part because the country has only four port facilities equipped to take it ashore.
  • But many countries are eager to export LNG, and at prices significantly lower than domestic prices.

The larger political problem here is that the public hasn't been told about the connection between high prices and political opposition to energy production. Short of a breakthrough in hydrogen technology, we are fated to import large amounts of energy. The real issue is whether we maintain enough energy production, and import capacity, to allow adequate supplies and reasonable prices.

All Americans are paying for this anti-energy nonsense, in higher heating bills and fewer jobs. The United States has the means to extract or import fuels in environmentally sound and cost-efficient ways. Someone in public life should start telling Americans who is raising their prices, says the Journal.

Source: Editorial, "Unnatural Gas Prices," Wall Street Journal, May 3, 2005.

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