Capitol Comments

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."

North Dakota has now officially become the third largest oil producer in the country, due in large part to the increasing use of hydraulic fracturing. The state moved past California, according to data from the North Dakota Industrial Commission, and is now behind Texas and Alaska in overall production numbers. 

On March 8, the New Hampshire House of Representatives overwhelmingly disapproved of participation in a regional a low-carbon fuel standard (LCFS) by a vote of 243-96. Opponents of creating a LCFS likened the proposal to a "liquid RGGI program," which refers to the cap and trade program created by northeastern and mid-Atlantic states under the Regional Greenhouse Gas Initiative.  

The Chairman of the Senate Energy and Natural Resources Committee, Senator Jeff Bingaman, is expected to soon introduce legislation mandating a Clean Energy Standard. Although details have not been published, it's expected that the legislation was based off a report drafted by the Energy Information Administration and will essentially let all forms of electricity generation that produce less CO2 than current state-of-the-art coal plants to qualify under the mandate based on a sliding-scale. Most congressional observers doubt there are enough votes in the Senate to pass the initiative, but Bingaman's proposal may provide some of the policy framework for the Administration's push for developing a Clean Energy Standard.

Yesterday, the State Department signed an agreement to resolve a long-standing dispute on oil and natural gas leases that straddled the maritime boundaries between the US and Mexico. The result is the creation of a legal framework for US companies to work in tandem with Pemex (Petroleos Mexicanos), the Mexican state-owned oil company, to develop offshore energy projects on roughly 1.5 million acres of the Outer Continental Shelf.