Secretary of Energy Ernest Moniz is in Texas yesterday, promoting the Administration’s energy agenda. In a speech at the University of Texas, Secretary Moniz made the seemingly counter-intuitive claim that Texas represented a good example of the President’s energy agenda in action:
In many ways, Texas is the perfect example of how President Obama’s all-of-the-above energy strategy can go hand in hand with combating climate change. This state is the number one producer of oil and gas in the country. Texas has also been a national leader in clean and renewable energy production. This state already leads the nation in electricity generation from non-hydroelectric renewable resources. And Texas has the highest wind-powered generation capacity of any state in the nation.
Moniz is right that Texas has seen an unprecedented oil and gas boom over the past few years. Since 2008, U.S. oil production has increased by 40 percent and Texas has more than doubled petroleum output since 2009. Oil production in the Eagle Ford region of south Texas increased 60 percent 2012 alone. Oil imports have decreased from 60 percent in 2008 to 40 percent and falling.
What’s peculiar about the Secretary’s statement, though, is the suggestion that Obama Administration policies have anything to do with this boom. Nearly all of the increase in oil and gas production has come from increases in production on private and state owned land, rather than on federal land. In fact, oil production on federal lands actually fell below 2007 levels in 2012. Texas is lucky that it contains relatively little federally owned land, which has allowed a greater development of its resources than might be the case otherwise. Even so, federal involvement with energy production has mostly been negative. The Environmental Protection Agency, for example, forced Range Resources to spend $4.2 million defending itself in court against charges that its fracking operations in Texas had contaminated groundwater (the charges were later proven false and EPA ultimately dropped the case). In reality, it was not government but private individuals like George Mitchell who brought us the current energy boom, which was achieved in spite of federal action, not because of it.
Secretary Moniz’s praise of Texas’ wind industry is also off base. Texas may have a lot of installed generation capacity from wind, but the intermittent nature of wind means that actual usable electricity generated from wind is only a small fraction of the official installed capacity numbers. ERCOT, which operates the Texas electrical grid, derates wind electricity to 8.7 percent of installed capacity for during periods of peak summer demand. And while Texas wind has been driven largely by federal subsidies, Texans ratepayers still have to pay for the nearly $7 billion in new “CREZ” transmission lines the state has had to build to transport wind electricity from West Texas to population centers along the I-35 corridor.
So while the Texas experience does have a lot to teach us about energy, the lessons are the opposite of what Secretary Moniz claimed.