"ENEMY IN THE GATE" you be the judge! But it is not clear sailing for domestic energy production. The US EPA is working feverishly to pre-empt the states by issuing new environmental regulations controlling fracking practices. This is setting off alarm bells among the states that see mischief in the EPA’s methods. The growth of domestic energy production from shale oil and gas has happened because the states were willing and able to be more flexible than the EPA balancing environmental and economic development interests. The fear is the light touch of EPA’s initial regulation of fracking will lead to “more flexibility” to crack down on the practice after the president is safely re-elected. Perhaps the 2012 election will bring more certainty no matter who wins—or not. Perhaps the EU will get its fiscal and debt act together but the results of elections in France and Greece suggest austerity is not selling well with voters who want growth and a return to prosperity not more political posturing. Even China is struggling with rising costs, slowing exports and thus growth, a real estate bubble of its own and the uncertainties of its ritual rotation of leaders. Volatility is here to stay in our global and domestic economy.
One thing we do know. Domestic energy production is real. It is producing economic growth and energy security. It produces jobs, increases tax revenue and raises public confidence. Domestic oil production is raising global spare productive capacity and more oil productive growth can, in fact, bring down global oil prices. And then there is this, American technology in horizontal drilling and hydraulic fracturing is the envy of the world. It will likely dominate the world’s energy production spotlight and is already transforming the energy future. The question is whether the US EPA will be permitted to extend its war on fossil fuels to limit the use of horizontal drilling and fracking in the US so that the only market for this innovative American technology is for export—along with US coal.
By. Gary L. Hunt
Gary Hunt is President, Scalable Growth Strategy Advisors, an independent energy technology and information services adviser and a partner in Tech & Creative Labs, a disruptive innovation software collaborative of high tech companies focused on the energy vertical. He served as VP-Global Analytics & Data at IHS/CERA; global Division President at Ventyx, now an ABB company; and Assistant City Manager-Austin Texas responsible for Austin Energy and Austin Water.
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