Wednesday, July 15, 2009

Natural Gas Not Influencing Washington

When it comes to power generation, there is a big battle is between coal and natural gas. Most of the new debate is due to massive energy policy coming soon. Realizing that natural gas is a cleaner burning fuel than coal, and considering we have plenty of it, you'd think natural gas would be getting a little more support. But this piece in the NY Times picks up on why that isn't happening.

-Saying they failed to protect their interests as a landmark bill came together and passed the House last month, natural gas executives are forming a strategy to influence rewrites in the Senate.

-"There are a lot of people in the industry who are scrambling their forces right now," said Fred Julander, founder and chairman of the Rocky Mountain Natural Gas Strategy Conference, an annual event that drew 1,800 industry people to Denver last week. "Whether we can learn and get up to speed -- and it's a steep learning curve -- is the question."

-Coal lobbyists have been talking to senators and aides for months, with their contacts becoming more frequent since the House bill passed. Coal lobbyists want to slow down the pace of the House measure's plan to cap greenhouse gas emissions and make businesses buy allowances for those emissions.

-Natural gas also will have to compete against the utility industry, which has been lobbying heavily on energy legislation. While they represent natural gas and coal, utilities have big reasons to favor coal.

-Electric utilities used coal for 59 percent of their power generation in 2007, while natural gas was used 13 percent of the time, according to the Energy Information Administration. Coal has been less expensive, making it more profitable for utilities to use as a fuel source.

So the bottom line here is that coal is cheaper for utilities, and the utilities are very organized and a powerful group of lobbyists.

-Lobbying by utility interests so far has dwarfed competitors. In the first quarter of this year, utilities spent $35.1 million on lobbying. The natural gas industry spent less than a tenth of that, $3.3 million. Of the top 10 industries with a stake in climate legislation, natural gas put the least money into lobbying in the first quarter, according to a recent E&E analysis."As a whole, we're not very sophisticated in terms of public relations, and we need to be," Julander said. "We need to grow up and get in this game. No one is going to give us anything, even though we're the best for the environment."

Although both coal and natural gas are abundant in the United States, you'd think this administration would take a major stand as climate change was supposed to be one of their major issues. Although natural gas still throws off emissions, its certainly cleaner than coal. It sure seems like it could provide us with an excellent bridge into the next generation of energy policy. We have a fuel we can use right now to generate electricity and power vehicles while we give technology time to develop alternative sources.

It all comes down to lobbying and power in Washington; it doesn't really matter what party is running things, or at least it seems. And right now coal is winning.

Disclosure: Long UNG

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