WASHINGTON — U.S. headlines are full of good news about the nation’s soaring oil and gas production, but those rosy forecasts may be papering over serious gaps, an international energy leader said Monday.
We may believe “we are living in a golden age of energy security,” said Maria van der Hoeven, executive director of the 29-nation International Energy Agency. “But in periods of abundance, we must challenge ourselves with tough questions.”
Speaking to a two-day Energy Information Administration summit in the nation’s capital, van der Hoeven suggested that the United States’ much-heralded “energy security,” may not be “as secure as we think.”
“Although things look bright,” she added, “there’s no time for complacency.”
In particular, van der Hoeven highlighted challenges tied to climate change and the increasing role of gas as a source of U.S. electricity.
Greenhouse gas mandates newly proposed by the Environmental Protection Agency are a good first step in arresting the flow of those heat-trapping substances into the atmosphere, but they are not enough, van der Hoeven said.
Globally, one of the biggest challenges is ending “wasteful fossil fuel subsidies,” which may encourage overconsumption of oil and gas, particularly in the Middle East, van der Hoeven said.
She did not include oil and gas tax incentives in the mix, but suggested the U.S. is doing much the same by not heavily taxing gasoline.
Among developed countries, the United States has next to the lowest price for gasoline, bested only by Mexico, she noted.
U.S gas taxes also may be “encouraging wasteful consumption,” van der Hoeven said.
She also invoked memories of the polar vortex that sent mercury dropping — and natural gas prices spiking — in January. Although the causes of that temporary climb in gas prices were complex and generally tied to infrastructure constraints, not production — van der Hoeven said they illustrate the risks of tethering too much electrical generation capacity to natural gas.
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The proposed greenhouse gas rule, other environmental mandates and the relatively low cost of natural gas have all helped encourage utilities to use that fossil fuel to replace some coal in their portfolios.
“Be careful about the degree to which you rely on gas,” van der Hoeven told the EIA conference. “Energy security requires diversity. You don’t want too many eggs in one basket.”