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Oversight of U.S. energy

May 23, 2016 | A version of this story appeared in Volume 94, Issue 21

I wish to respond to the opinion piece by Jack Gerard, president of the American Petroleum Institute, in C&EN’s April 4 issue (page 26). Gerard provides an overview of the benefits of the “shale gale” to the chemical industry, to the U.S. economy, and to workers. Others have described this as well, including the American Chemistry Council and the University of Michigan in our 2014 report “Shale Gas: A Game-Changer for U.S. Manufacturing.” Unfortunately, Gerard follows this review with a tired litany of complaints and half-truths about the impacts of environmental regulations on the U.S. energy industry, with the usual dogmatic solution of letting the market decide. When will industry learn that its arrogant dismissal of ­legitimate public concerns and public ­policy responses is its own biggest problem?

Those concerns run from cradle to end use of the products of the oil and gas industry; they are shared not only by the public but by other industries as well. For example, the Michigan report found that the leading concern of manufacturers in energy-intensive industries was their energy suppliers’ societal license to operate. Perhaps these industries might consider applying the market-driven tactics that Gerard advocates to improve the conduct of their suppliers in much the same way that companies in the apparel industry (such as Nike) have done.

Gerard levels the usual formulaic criticisms of environmental regulation by government. At a time when asthma rates continue to climb nationwide and local environmental crises are receiving national attention, it is very difficult for anyone but the most tone-deaf to argue that public health challenges can be effectively met by the free market.

Beyond that, Gerard’s characterization of the Obama Administration’s Clean Power Plan can be charitably labeled as a distortion. The principal target of the Clean Power Plan is coal, not natural gas; the emissions reductions can be met by a combination of carbon-free power generation and replacement of an aging fleet of coal-fired power plants with natural-gas-fueled plants. In the near and medium term, this will actually benefit the industry that Gerard represents, but apparently the aversion to thoughtful regulation trumps considerations of societal or even interest group benefit.

We must realize that the use of fossil energy sources is ultimately unsustainable, not because of supply or resource limitations, but because of the environmental and climate consequences of using them. We cannot rely on the market alone to produce adequate solutions as long as the externalities of fossil resource use remain unaccounted for.

Mark Barteau
Director, University of Michigan Energy Institute
Ann Arbor, Mich.



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