Wednesday, September 5, 2012

The Dozen Most Important Energy Facts Of President Obama's Term

Energy is assuming appropriately a prominent role in this year's campaign, but often facts are the first casualty of political debate.  In the hope of infusing facts into the political dialogue ahead, I have compiled my selection of the most important energy facts of the President's first term.

Each fact was selected because of its importance to our economy, national security or environment.  Different people will look at many of these facts and disagree about whether they represent progress or folly. Moreover, the President and his policies had a lot to do with creating some of the chosen facts but little or nothing to do with others selected. 

Again, the point of the list is to select the most important energy facts of the President's term to provide a foundation for discussion.

12. US Solar power increased about 14-times since 2008, skyrocketing from 500 megawatts installed in 2008 to about 8,000 megawatts at the end of 2012, and solar prices declined about 75% to $2.50 per watt for large solar farms.

11.  The global solar market reached $90 billion and was bigger than the global arms market in 2011.

10. Wind power increased from 25,000 megawatts installed in 2008 to about 55,000 megawatts by the end of 2012, as at least 7 states generated more than 10% of their electricity from wind, but Congressional inaction on the Production Tax Credit puts many 2013 projects on hold and triggers layoffs.

9. US carbon emissions decline to the lowest levels in 20 years, as a result of natural gas displacing coal and oil, more renewables, and energy efficiency. The US cut carbon emissions more than any nation in the world since 2006.

8. Toxic air emissions nationally declined 19% in 2010 and further declines took place in 2011 and 2012, because more coal plants installed scrubbers and more gas that emits no toxic air pollution was used to make electricity.

7. The electricity market share of coal-fired generation fell from 48% in 2008 to approximately 36% in 2012, and gas increased its generation market share to about 30% in 2012.  In April 2012, gas and coal each supplied 32% of America's electricity.

6. Total US energy demand fell to 1998-1999 levels, with coal and oil consumption dropping respectively to 1985 and 1990 levels.

5. US Oil production rose another 12% in the first 7 months of 2012 and hit its highest level in 14 years.

4. Oil imports will drop to 42% of US oil consumption in 2012, the lowest level in 20 years, and down from 60% in 2005.

3. Sustained high oil prices caused in 2011 a new record high average annual gasoline cost of $2,850.

2. Thanks to shale gas that supplied about 37% of all US gas, natural gas production set new record highs in 2010, 2011, and possibly 2012, as the US became the world's top gas producer. Hundreds of thousands of jobs were directly and indirectly created by the gas boom.

1. Natural gas prices plummeted from $13 per thousand cubic feet in July 2008 to $2.75, saving many families $1,500 in gas and electricity costs, compared to 2008 pricing.

I pick the falling natural gas price as the biggest energy fact of the President's term, as it generated economic benefits estimated at $1 billion per day as of the Spring of 2012, and  helped to prevent a double dip recession in both 2011 and 2012, as sustained high oil prices and a growing. European financial crisis cut growth. Falling natural gas prices also led to plummeting toxic air and carbon dioxide levels, because low-priced, cleaner gas is increasingly used to make electricity and heat buildings.

These facts don't answer important policy debates but do provide direction.  For example, I believe the failure of Congress to pass the Natural Gas Act (the Pickens Plan), despite the domestic gas glut and high global oil prices, is a major mistake.

Energy facts are essential to good debate about  tax policy, regulation, environmental and public health stewardship, national security, and economic growth.  Most importantly, energy facts are essential to planning for the future and a vision for the nation, without which the nation moves blindly.


  1. John: Regarding point #1, to be truly factual, if you are trying to show an impact from the President's term, you would use the first NYMEX settle after President Obama was actually inaugurated. In that case, the February 2009 NYMEX settle was $4.476, so the drop from $13 to $4.476 should be credited to President Bush, since that actually occurred during his term.

    1. Concerned ScientistSeptember 5, 2012 at 9:17 AM

      Obama has been helped by the oil and gas industry far more than most liberals would be willing to admit. I think that if it weren't for shale gas, Romney would have a five point lead. Cheap gas and the jobs created by new oil and gas development have helped the economy more than the stimulus (which helped and was the right thing to do but not big enough to pull us completely out of the nosedive that Bush's policies and a deregulated banking industry led to).

    2. I agree that the gas boom has been central to keeping the US economy from being in recession. The stimulus--about $360 billion per year or close to half of the stimulus provided by the American Recovery Act--that it is providing right now remains essential to keeping GDP positive. And yes Romney would be ahead without it.

  2. I know that permitting and planning for Wind mill farms can take years. How many projects that came on stream since 2008 can trace their genesis to the prior generation? Until 2012, the current administration was openly hostile to shale gas development. They should get zero credit for its contribution to the economy.

    1. I can't edit, so new post. I meant to say "prior administration" instead of "prior generation"

    2. First on the shale gas position of the President's Administration, really? I ran the permitting and gas regulation from 2008 to 2011 of the PA gas boom. I did not receive one hostile word about the shale gas boom in PA from the EPA, DOE, Whitehouse. That is strange silence if they were openly hostile. Lisa Jackson testified to Congress in the Spring of 2011 that hydraulic fracturing had not caused pollution. Of course the EPA must be a professional and independent regulator of the industry. It should be neither friend nor foe. Just look at what happened with regulation of offshore at the Gulf disaster when that professionalism and independence were compromised. The results were terrible for everyone.

      On wind, the credit markets totally froze following the forced bankruptcy of Lehman Brothers on September 15, 2008. Nothing was getting financed. I was there and it was scary as hell. But for the efforts of the Obama administration wind farm construction in 2009 would have gone to a trickle. Specific measures were taken and they worked. The wind fact is one that this administration had considerable influence in making so.

    3. Concerned ScientistSeptember 5, 2012 at 1:22 PM

      I have not seen any hostility as an official position from the Obama Administration. I have mainly seen supportive comments from Obama. A few individuals like the EPA guy down in Texas were hostile to the industry. I'd say their work in Dimock helped the industry significantly. Many democrats have been quite hostile to shale gas though. It's a stupid position - one they will regret if they don't already. It's the best news we have had on the environmental front in many years and it has also been a big winner for the economy.