3 ways to strengthen US energy infrastructure
Aug 6, 2012
In my year as president of the IRWA, I saw firsthand the infrastructure challenges faced by developing nations such as Uganda, South Africa, and China. While these countries are building fundamental elements, like roads, bridges, and pipelines, every country has an ongoing need to improve infrastructure. This can be seen, for example, in the U.S. with our energy development.
Such upgrades help us better capitalize on our resources and better improve our economy. For example, these upgrades create jobs, which inject the economy with an influx of workers who will need housing, retail, and other commercial real estate to support their work. The economic impact in South Texas, for example, cannot be overestimated. Huge amounts of money are flowing in both the Texas and local economies. Even the drives constructed for drilling are in some cases better than the unpaved county roads.
In the U.S., some proponents of natural gas and liquid gas drilling cite how this effort can be a solution to domestic energy needs. Drilling rigs are increasingly cropping up in Pennsylvania and South Dakota to extract more of the wet product, the liquid gas. In addition, new drilling techniques have substantially increased what we now understand to be our country’s natural reserves — potentially a 50-100 year supply of gas. Here are three ways that local economies can build on this good news to bolster our energy infrastructure.
1. Beat them on the facts. If you follow the news, you’ve likely noticed that new drilling techniques used to extract natural gas are consistently — and unfairly — criticized in the media for being dangerous to water supplies. There have been a few instances of groundwater contamination, but generally the drilling rigs are going down 9,000 feet while aquifers and wells only descend around 300 feet. Also, a recent study by Duke University should ease concern about the impact of drilling on water supplies, as it shows no correlation between drilling and water contamination.
2. Continue upgrading pipelines. We have a massive need for pipeline infrastructure. Once wells are drilled, pipelines are needed to transport gas around the country. In Texas, there’s been a substantial amount of pipeline development in southern parts of the state as well as in the Shreveport area and in Dallas and Fort Worth. Nineteen pipelines were under construction in the U.S. as of May, 2012, including new pipelines, expansions, and lateral additions. Dozens more are in the planning stages. So while U.S. natural gas reserves offer the advantage of a domestic source of energy, we’ll need to make some infrastructure improvements before it’s truly useful.
3. Update legacy facilities. As more gas becomes available via pipelines, more power plants will likely be gas powered. Natural gas facilities are less expensive to build than coal plants, and many coal- and oil-powered facilities will likely convert to gas to take advantage of this cheaper fuel source. The average price of natural gas sold to electrical power consumers has fallen over the past couple years in most states, according to the federal Energy Information Agency. For example, in Texas, prices dropped to $2.27 per thousand cubic feet in April 2012, down from $4.54 in April 2011 — a drop of 50 percent.
These are some of the major ways we can strengthen our energy infrastructure to make use of the resources available beneath U.S. soil and usher in energy independence. As a result, it can boost local economies where this infrastructure is required, triggering new construction to accommodate the workers who will build and maintain new pipelines and power plants.
Posted by: Randy Williams