Politics take center stage at CERA energy conference

Energy has become hotly political under the Obama Administration, which has been forced to evolve its rhetoric as domestic oil and gas potential has surged, policy experts said at the CERA Week energy convention Monday evening.

The politics of energy development and subsidies historically has been aligned geographically, based largely on such factors as where corn for ethanol is grown, for example, or where conventional fossil fuels are produced, noted Maryam Brown, chief counsel to the House Energy and Commerce Committees subcommittee on energy and power.

But issues such as regulation of hydraulic fracturing or subsidies for conventional or renewable fuels have taken a decisively partisan turn, she said during a session Monday titled “U.S. Energy Policy in an Election Year.”

“Members positions’ and votes have been more defined by the color of the jersey they are wearing,” Brown said. “Energy and environmental policy issues used to break much more along regional lines and less so along party lines.”

Prominent players in the oil and gas industry have criticized the Obama Administration as being hostile to fossil fuels and unreasonably supportive of green energy subsidies. They point to limitations on access to federal lands for oil and gas production and intense focus on  hydraulic fracturing.

However, President Barack Obama’s latest State of the Union took a more conciliatory tone toward oil and gas activity, calling for a national “all-of-the-above” approach to domestic energy production.

Frank Verrastro, senior vice president for CSIS Energy and National Security Program, said Obama’s energy rhetoric has evolved over the past three years. The administration stressed renewable energy early on, he noted, driven by the conventional view that the nation’s oil and gas resources were depleting.

“A lot of us believed that resource scarcity was the road of the future,” Verrastro said. “We’ve reversed that. There’s trillions of barrels out there. The world changed on this administration.”

With the development of shale gas and tight oil in the United States, the best way to harvest North American fossil fuels has become a top political issue.  Brown noted that green energy subsidies and the Keystone XL pipeline will remain key during the election year.

She said there is Capitol Hill support for the elimination of all energy subsidies, “a true level the playing field strategy.”

“Our members frame it as the difference between a Keystone economy and Solyndra economy — one that’s funded by private markets and one that’s not,” she said. “If it’s not sustainable economically, it’s not sustainable period.”

The Keystone XL, which the administration has refused to approve pending further environmental reviews, would carry Canadian oil sands crude to Gulf Coast refineries. Solyndra is a solar panel manufacturer that went bankrupt after receiving millions in government loan guarantees.