National Energy Policy

NSSGA POSITION

Adequate, affordable and reliable energy supplies are essential to maintaining and growing the stone, sand and gravel industries. NSSGA supports a national energy policy that balances supply and demand without compromising environmental interests.

 

BACKGROUND

After a decade of volatility in gasoline prices the American people are acutely aware of the need for a new U.S. energy policy.  Following the passage of the Energy Policy Act of 2005, the most recent attempt to pass a comprehensive energy bill was in 2010.

Although the 2005 law was considered a positive step forward, both proponents and opponents of the bill were disappointed at the issues left unresolved by the bill; chief among them being its failure to significantly reduce foreign oil imports, which account for 60 percent of the nation’s oil consumption of 20 million barrels per day.  The bill also failed to deal with opening the Alaska National Wildlife Refuge (ANWR) to oil and gas development, or creating a more ambitious renewable energy program.  Efforts in the intervening years to suspend or repeal gas user fees were unsuccessful.

The 112th Congress did not take up comprehensive energy legislation, but numerous bills on specific energy issues were considered.  Several notable bills that passed the House but were not considered by the Senate include: H.R.4480, a bill to increase leasing of federal land for oil and gas production; H.R.2401 and H.R.3409, bills limiting EPA’s issuance of new emissions restrictions for coal-fired power plants; and H.R.6213, that would have prohibited the Department of Energy from granting loan guarantees for innovative and renewable energy projects.

Sen. Lisa Murkowski (R-Alaska) introduced the Republican-backed Domestic Energy and Jobs Act of 2012 (S.1113), a comprehensive bill to expand domestic energy production and provide a shot in the arm to the struggling economy.  The bill included 13 measures that would establish an “all-of-the-above” energy plan, including congressional approval of the Keystone XL pipeline project and expanded oil and natural gas production. The legislation also included language promoting the domestic development of critical minerals.  The bill died quietly in committee, and the 112th Congress concluded without acting on comprehensive energy policy legislation.

With both major political parties putting energy and reducing America’s dependence on foreign oil at the top of their policy agendas, the 113th Congress is certain to consider additional energy legislation that includes proposals to increase alternative fuel development, expand offshore petroleum drilling, rein in energy speculation, and replace some of the sweet crude oil in the petroleum reserve with less desirable and cheaper heavy crude oil.

As a means of stopping climate change and driving markets toward clean energy, the idea of placing a price on carbon emissions has received increased attention.  Proponents of this proposal argue that by raising the price of an item of which you want less – in this case, emissions from coal and oil – market forces will drive consumers and businesses to purchase lower-emitting sources of energy.  The increased market demand for those sources drives up production and lowers the price.

Sweeping tax reform legislation offers an opportunity for imposing revenue raisers to offset likely lower corporate tax rates and elimination of loopholes in the tax code.  An increase in the gas user fee is a possible option supported by transportation interests and a way of dealing with the long-term solvency of the Highway Trust Fund.  Imposition of a carbon tax is a preferred approach of environmental interests.  The challenge is to get enough Republicans and Democrats to sign on to any tax increase.

NSSGA will work with its coalition partners to ensure that any energy legislation does not adversely impact the aggregates industry and seize opportunities to benefit the transportation sector.

 

TALKING POINTS

  • Stone, sand and gravel are essential materials in the construction of roads and highways, homes and schools, public works, airport runways, and many consumer products including paint, paper and plastic.  A stable and growing aggregates industry depends on a reliable and affordable energy supply to process aggregates.
  • Relieving increasing urban gridlock, which will save fuel, time and money, must be a part of a comprehensive energy policy.
  • Comprehensive tax reform, which is expected to be considered by the 113th Congress, is likely to offer the opportunity to increase the gas user fee to offset lower corporate tax rates or elimination of tax loopholes.
  • Imposition of a carbon tax to reduce climate change, while providing needed revenue offsets, is another revenue option being discussed.  If this option were adopted, the nexus between energy and transportation would argue for diverting some of these revenues to surface transportation infrastructure needs.
  • Since the 1970s, U.S. energy use has increased at twice the rate (30 percent) of U.S. energy production (14 percent).  Over the next 20 years, U.S. oil consumption is projected to rise by 33 percent, natural gas consumption will grow by more than 60 percent, and demand for electricity will rise by 45 percent.  Investment in energy infrastructure, including transmission lines and natural gas pipelines, has not kept pace with demand.
  • A national energy policy must balance economic concerns and environmental concerns.
  • Outdated and burdensome regulations have made maintaining, updating and making current facilities more energy efficient problematic.
  • Energy efficiency since the mid-1970s has increased by 30 percent and there is more that can be done, but efficiency and conservation alone are not sufficient to support the energy needs of the nation’s economy.
  • NSSGA urges Congress to focus on the real energy crisis, which is inadequate energy supplies that threaten long-term economic growth and job creation.

Updated:  November 2012