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Keystone and hydrofracking: Energy delayed is energy denied (perhaps)

Nov 19, 2011
Carter Wood

The National Journal's Energy and Environment Blog is running a series of posts from a panel of experts examining the question, "Was President Obama right or wrong to delay the Keystone XL oil pipeline?" Business Roundtable President John Engler argues it was the wrong decision, one that will have a serious impact on jobs and energy security.

From "Delaying U.S. Jobs, Energy Security ":

When the State Department announced its delay of the $7 billion Keystone XL pipeline last week, a decision affirmed by President Obama, many of project’s supporters wondered, “Aren’t jobs supposed to be a national priority?”

The project’s delay into 2013 (or beyond) puts 20,000 new high-wage U.S. jobs in construction, engineering and other pipeline-related fields on the sidelines. It also postpones the flow of an estimated $5 billion in new property taxes to state and local governments along the pipeline route – revenues that could help pay for the teacher and police jobs so often stressed by national political leaders. 

Engler concludes:

American economic growth relies on dependable supplies of affordable energy; energy security and jobs are interrelated. The Keystone decision demonstrates that the White House has yet to find the right balance among job creation, economic growth, pragmatic environmental protection and sound energy policy .

The series includes posts from leaders of think tanks, other trade associations, and academia -- both pro and con  -- with several critics suggesting a clear political motivation behind the President's decision to delay the project until after the 2012 elections. That's the same line of argument Charles Krauthammer levied in his razor sharp column in The Washington Post, "The great pipeline sellout." These arguments repeat themselves, though. This National Journal contribution from Brent Erickson, executive vice president of the Biotechnology Industry Organization, offers a different line of thought, however. From "Every Energy Project Needs Stable Policy":

Postponing the decision on Keystone till after the next election sends a message to the markets that no energy investment is safe. This indecision and delay may undercut the investment rationale in the Keystone project and eventually kill it. Policy instability has also been a millstone for the biofuel and bioenergy industry as it has sought investment, so I for one do not view this as a positive outcome. 

Elsewhere in the world of hot energy topics, Daniel J. Popeo, provides as good of a summary as we've seen of the controversy over hydrofracking. In his Washington Examiner column, "Left-wing activists are blocking a budding U.S. energy resource," the chairman of the Washington Legal Foundation makes a point that the BRT's Engler often does, as well (as above): "It's difficult to square the actions of some states and the federal government on fracking with their rhetoric on creating jobs and reducing budget deficits."

Which takes us to The Examiner's Beltway Confidential, which today blogs, "Obama USDA delays shale drilling, up to 200k jobs":

President Obama's United States Department of Agriculture has delayed shale gas drilling in Ohio for up to six months by cancelling a mineral lease auction for Wayne National Forest (WNF). The move was taken in deference to environmentalists, on the pretext of studying the effects of hydraulic fracturing.

“Conditions have changed since the 2006 Forest Plan was developed," announced WNF Supervisor Anne Carey on Tuesday. "The technology used in the Utica & Marcellus Shale formations need to be studied to see if potential effects to the surface are significantly different than those identified in the Forest Plan." The study will take up to six months to complete. The WNF study reportedly "will focus solely on how it could affect forest land," despite the significance of hydraulic fracturing to united proponents of the delay, "and not how it could affect groundwater."

Just six months ... for now.

Finally, The Daily Caller points us to another battle over hydrofracturing, "Oh frack: Obama again under fire from environmentalists"

If President Barack Obama thought he was out of the environmentalist woods by delaying work on the Keystone XL pipeline, he was wrong.

Claiming success in the pipeline battle, environmental groups now have their next target: natural gas development in the Delaware River Basin. And again, Obama is the focus of their outrage.

“November 2011 is Obama’s moment of truth on extreme energy. It’s ours too,” Mark Ruffalo, actor and founder of Water Defense, wrote to supporters this week.

Moment of truth on extreme energy? Hope he doesn't overact as much as he overstates. But at least there's no feigning here about the policy decisions that were discussed so well in National Journal's blog colloquium. (And thanks to reporter Amy Harden for moderating.) As far as we can tell, Ruffalo does not care about energy security or those jobs for people that could be created by completing the pipeline or developing natural gas.