State and federal policymakers in the past could be confident that America’s energy demands would increase every year. Now the future isn’t as clear. Barbara Tyran, director of Washington, D.C., and state relations with the Electric Power Research Institute (EPRI), said the Great Recession, a greater use of locally produced power, a growing interest in energy efficiency and the unprecedented increase in the natural gas supply have turned once staid assumptions about the future of energy on their head. Tyran was one of the featured speakers at a CSG policy academy about natural gas development last week and noted that all three branches of the federal government are currently engaged in shaping energy and environmental outcomes that will impact the future electricity and natural gas sectors.
Pennsylvania Governor Tom Corbett announced that counties and local municipalities would receive $204 million from impact fees generated by shale drilling as a result of the passage of Act 13 last February. According to the release, $25.5 million will be directed to state agencies with safety and regulatory oversight authority over the natural gas industry, $104 million be disbursed directly to localities, and $72 million will be set aside for competitive grants for infrastructure and recreational improvement projects.
As the process of hydraulic fracturing becomes more prevalent, several municipal governments are using their local zoning power to restrict or prohibit resource exploration. Many of these new local ordinances conflict with state permitting authority; however, some state statutes may be ambiguous when it comes to regulating oil and natural gas exploration.
Natural gas futures prices inched north of $2.30 per 1,000 cubic feet for the first time in several days, but it underscores the pessimism by some utility companies in the economics of building new nuclear, alterative energy, and new coal power plants. The Energy Information Administration (EIA) reported late last week that coal's share of power generation fell below 40 percent for the first time since 1978 during November and December of 2011. According to an article in today's Wall Street Journal, NRG's CEO David Crane observed, "It's killed off new coal and now it's killing off new nuclear."