People living outside the Marcellus Shale region in places like New York City and New Jersey have the pleasure of reaping the benefits of natural gas while not incurring any of the temporary inconveniences. These areas will never see development yet they continue to delay and stop pipeline expansion into major cities as well as pass bans on the hydraulic fracturing process. New Jersey resident, John Broyles, takes a look at this phenomenon.
After reaching a high of over $13 in June of 2008, natural gas prices closed at $3.16 on the 15th of February. We can credit hydraulic fracturing for low cost and reliable supplies of natural gas. Considering the fact that 27% of all natural gas demand is commercial and industrial, residential customers aren’t only seeing lower heating and electricity prices, they’re also seeing lower priced consumer goods.
The Marcellus Shale has accounted for 25% of all natural gas volumes in the US. It’s also closest to the premium northeast markets. It would make one wonder why in late January we saw spot prices in New Jersey and New York trade up to $35 while prices in New England traded up to $65.
Environmentalists, in pursuit of their unrealistic green agenda, succeeded, along with the EPA, in putting such onerous regulations on the coal industry which, in turn is decimating coal generation. They’ve also succeeded in pushing unattainable renewable energy mandates in the northeast states. In addition, they’ve attempted to block new pipeline capacity that could bring cheap natural gas supplies to the region and caused undue delays.
All this has succeeded in creating the perfect storm. As coal generation plants have been retired in New England, new gas fired generation has been brought on line. The problem? New England and New York/New Jersey already suffer from a shortage of natural gas capacity during peak loads. This coupled with the fact that natural gas prices in the Middle East and Europe have greatly surpassed those in the United States, has led to 2 billion cubic feet of natural gas supplies being removed from New England and another 1.8 billion cubic feet of capacity removed from the Mid Atlantic area that helps feed New Jersey and New York. Since coal units have been retired, that generation is no longer available for peak loads.
Environmentalists will tell you we can make up the shortfall with clean wind and solar. First, there is no such thing as clean wind or solar. Not only are wind turbines made up of tons of concrete (considered hazardous waste in landfills) but their gearboxes are made up of hundreds of pounds of rare earth metals. The average lifespan of a wind turbine has also been overstated. Studies have shown that because of corrosion, wind turbines only last an average of 12-15 years. One only needs to look at California for an example of rusted and decrepit wind turbines. In addition, wind generation requires “spinning reserves.”
Because energy can’t be stored, fossil fuel plants must always run in order to balance generation needs when winds shift and output changes. Wind turbines must also be placed in areas that are away from densely populated areas. Simple physics shows that transmitting that electricity to populated areas is costly and inefficient. Hazardous waste is present not only in solar panels but also in the manufacturing process. Ask any green energy zombie what happens to all that waste and you’ll get denial or uncomfortable silence.
Several new pipeline projects have been proposed to help feed the appetite for cheap natural gas in the northeast. Last year, after years of legal wrangling and delay tactics from environmental groups, the Federal Energy Regulatory Commission finally approved Spectra Energy’s expansion to bring the first new natural gas supplies into Manhattan in years. The opposition from groups in New York and New Jersey was baffling.
New York City passed a mandate to phase out residual fuel oil and replace it with low sulfur oil. 9000 buildings were affected and the supply into New York would go a long way to satisfying their clean energy goals. Building owners would be incentivized to switch to natural gas as the MMBtu equivalent is $23 for No. 2 fuel.
New Jersey’s opposition came from community groups who gave in to fear mongering and environmental groups who have wreaked havoc on the economy of the state of New Jersey. They attempted to scare the residents of New Jersey by sensationalizing the fact that 68 people died from natural gas pipeline accidents in the past 5 years. (For comparison purposes 20 people die per year by electrocution and 40,000 die in auto accidents). Natural gas transported by pipe has an excellent safety record.
They also spread false information about radon levels in Marcellus gas using a flawed and inaccurate study done by Marvin Resnikoff. In a last ditch attempt to block the Spectra Energy NJ/NY expansion, Jersey City, NJ filed a request for a rehearing claiming the Federal Energy Regulatory Committee was “partnering” with Spectra to build a new pipeline.
There have been several environmental groups behind the opposition to much needed pipeline expansion in New Jersey. The NJ Sierra Club, Delaware Riverkeeper, and New Jersey Highlands are among such groups. All organizations mention the environmental impact of pipeline expansions, such as contaminated drinking water. Of course there are no facts to back up their claims, just more of the same tired sensationalism.
Another tactic is to mention the effect on wildlife. This was the same argument used in Alaska. Despite all the claims, wildlife there is thriving. It makes one wonder why we don’t hear the same groups protest with such vigor about the massive bird kill caused by wind turbines.
What’s the real motive behind the environmental groups opposing new pipeline capacity? It has little to do with the pipelines themselves, and is mainly due to their opposition to Marcellus Shale development. That’s exactly why their arguments don’t hold water. Whether natural gas is sourced from the Gulf Coast (where environmentalists have push drilling so far off shore we greatly increase the costs and safety of drilling) or shale deposits makes no difference to the pipelines. They are “open access” and must allow producers access to their pipe.
In 2011, the New Jersey legislature passed a bill banning hydraulic fracturing in the state and in 2012 passed a bill banning the disposal of natural gas waste materials in New Jersey landfills. Armed with propaganda from anti natural gas groups they pushed the same false and unproven claims as the environmental groups who have so far worked hard to oppose coal, oil, nuclear and natural gas but have yet to offer a real solution to meet our energy needs. Fortunately, Governor Chris Christie showed he is sane and vetoed both bills.
As a New Jersey resident, I fully support shale development and the pipelines necessary to bring our domestic energy to market. Not only does our economy depend on it, our national security does as well. We need to stop being held hostage by Environmental groups who wouldn’t think twice about destroying jobs in our state with an already high unemployment rate in order to advance their green folly.