The Pittsburgh Tribune-Review reports today on the complicated issue of natural gas exports and the political and global trade issues that further complicate it. I’m quoted in the article.
If shale gas is responsibly produced – and we are not there yet, in my view - the current production boom presents our nation with an enormous opportunity to grow our economy; to increase energy security in the electricity production, manufacturing, and transportation sectors; and to protect the climate, the environment, and public health. But we will not necessarily achieve or sustain these multiple wins by blindly following free market economics and Adam Smith’s invisible hand, which will lead natural gas producers to chase the highest prices for gas, which are right now in Europe and Asia.
Low domestic gas prices are primarily driving the current shift away from coal for electricity production in the U.S.. Exporting gas will raise those prices and could halt the shift. To be sure, shale gas booms around the globe may change the market dynamics to some degree, and there are geopolitical issues that complicate matters. But it is clear that higher natural gas prices will impact a shift to natgas as the fuel of choice for electricity production and as a transport fuel, and will impact the reviving manufacturing sector in multiple ways.
What are the risks to all of these hopeful trends if the US begins to export significant quantities of natural gas? Some studies by the Department of Energy are underway. We need as a nation to think this through now – before export terminals are built – and to commit to an enlightened US energy policy that uses abundant, low-price, domestic natural gas as a short, wide bridge to a renewable future that is backed up by gas. That path offers the United States the most promising route to a clean, sustainable, high growth future.