Washington, D.C. - U.S. Senator James Inhofe (R-Okla.), Ranking Member of the Senate Committee on Environment and Public Works, delivered a Senate Floor speech today on President Obama’s cap-and-trade agenda and its role in pushing energy prices higher.
The following are excerpts from the speech:
“But what I call the Obama Administration's cap-and-trade agenda is also playing a major role in pushing prices higher-and not just for gasoline. This agenda hurts families, truckers, and farmers-basically, anyone who drives, uses diesel, or flips a light switch. In a word: everyone.
“My message today is simply this: higher gas prices-indeed, higher prices for the energy we use - are an explicit policy goal of the Obama Administration. Let me put it another way: the Obama Administration is attacking affordable energy.
“By stopping the President's costly cap-and-trade rules, we will also remove a significant barrier to developing America's energy resources. You see, the cap-and-trade agenda is also about energy austerity. The hope is that if we restrict enough supply, the price will increase, and we can then simply shift to less costly alternatives. Yet this is wishful thinking.
“We have, in fact, 163 billion barrels of recoverable oil-nearly six times higher than what President Obama and the Democrats like to claim. Let's think about 163 billion barrels for a moment: that is enough to maintain our current levels of production and replace our imports from the Persian Gulf for more than 50 years.
“But oil resources offer only a glimpse of the full picture. As I noted earlier, CRS found that America's combined recoverable natural gas, oil, and coal endowment is the largest on Earth. It's far larger than that of Saudi Arabia, China, and Canada combined.”
Full text of speech
As prepared for delivery
Mr. President, when President Obama took office, the national average price for regular gasoline was $1.84 per gallon. Today, the average price is $3.52 per gallon - a 91 percent increase. Prices have already topped $4.00 in some parts of the country.
There are many reasons for this - Middle East conflict and rapid growth in developing countries are two examples. But what I call the Obama Administration's cap-and-trade agenda is also playing a major role in pushing prices higher - and not just for gasoline. This agenda hurts families, truckers, and farmers-basically, anyone who drives, uses diesel, or flips a light switch. In a word: everyone.
My message today is simply this: higher gas prices - indeed, higher prices for the energy we use - are an explicit policy goal of the Obama Administration. Let me put it another way: the Obama Administration is attacking affordable energy.
How do I know this? Steven Chu, Secretary of Energy, told the Wall Street Journal in 2008 that "[s]omehow we have to figure out how to boost the price of gasoline to the levels in Europe." That's interesting. Just what are those "levels" in Europe?
The United Kingdom: $7.87 per gallon;
Italy: $7.54 per gallon;
France: $7.50 per gallon; and
Germany: $7.41 per gallon.
If you think $4.00 is too much for a gallon of regular, fasten your seat belts.
The central fact of the cap-and-trade agenda is inescapable: it's designed to make the energy we use more expensive. We all know the infamous quote from President Obama in 2008. He said that under his cap-and-trade plan, "electricity prices would necessarily skyrocket." Note the word "necessarily." The President had it right: the point of cap-and-trade regulations is to make you pay more on your utility bills. And the Obama EPA is here to make it happen.
Thankfully the House of Representatives is moving legislation today to stop the Obama Administration's attack on affordable energy. The House Energy and Power Subcommittee is voting on the Energy Tax Prevention Act of 2011, a bill I introduced in the Senate last week. My bipartisan bill has 43 Senate cosponsors.
The bottom line of the Energy Tax Prevention Act is this: EPA cannot implement global warming regulations under the Clean Air Act, the very regulations that will pinch your pocket at the pump and drive up your utility bills.
By stopping the President's costly cap-and-trade rules, we will also remove a significant barrier to developing America's energy resources. You see, the cap-and-trade agenda is also about energy austerity. The hope is that if we restrict enough supply, the price will increase, and we can then simply shift to less costly alternatives. Yet this is wishful thinking. Alternatives are fine, even necessary, but in most cases, they aren't widely available or commercially deployable yet-at least not in a form to efficiently, affordably, and reliably meet our existing energy needs. So oil, coal, and natural gas are here to stay.
But that's fine; there's nothing to worry about. Many are unaware that America's combined recoverable natural gas, oil, and coal endowment is the largest on Earth. In fact, America's recoverable resources are far larger than those of Saudi Arabia, China, and Canada combined.
Yet EPA, along with a host of other federal agencies, is actively blocking our ability to develop these resources. You can be sure Chinese officials are both stunned and pleased that America, through a conscious policy choice, is forgoing trillions of dollars of resource wealth to create jobs, raise revenue, spur new technology, and unleash growth and prosperity for generations to come. I, too, am stunned, but not pleased.
Thanks to the non-partisan Congressional Research Service, we now know what resources we have and what we aren't getting out of the ground. The CRS report was requested by me and my colleague, Sen. Lisa Murkowski. Frankly, we asked for this report because we grew tired of the Democrats' refrain that America only has 3 percent of global oil reserves - which, according to this view, means more drilling and production at home is futile. The 3 percent mantra is their bread and butter talking point.
President Obama himself has said it: "With 3 percent of the world's oil reserves, the U.S. cannot drill its way to energy security." My Democratic colleagues here in the Senate have said it: "The U.S. has only 3% of known oil reserves, yet we use 25% of the world's oil production. We cannot drill our way out of that math." But the non-partisan CRS shows the full, complete, accurate picture of America's resources - and shows that, yes, we can produce our way to energy security.
That's because CRS shows more than just our proven oil reserves, which is what the Democrats conveniently cite. America's proven reserves, of course, are a modest 28 billion barrels. The word "proven" is important here. The only way to estimate proven reserves is to drill. But lo and behold, that's not possible because federal policies, supported by President Obama and many Democrats, have made 83 percent - let me say that again: 83 percent - of America's federal land inaccessible to drilling.
Moreover, for decades, many Democrats supported drilling bans in the Outer Continental Shelf, on the East and West coasts, in offshore Alaska, and in large portions of the Gulf.
So the next time you hear someone say, "Well, we have just three percent, it won't mean a thing if we drill more," and that we have only 28 billion barrels of proven reserves, go read the CRS report for the complete picture. CRS includes the Energy Information Administration's estimates of proven reserves, as well as estimates from the U.S. Geological Survey and the Bureau of Ocean Energy Management, Regulation, and Enforcement, which show America's recoverable oil resources from areas both accessible and inaccessible to drilling. It's all there.
We have, in fact, 163 billion barrels of recoverable oil - nearly six times higher than what President Obama and the Democrats like to claim. Let's think about 163 billion barrels for a moment: that is enough to maintain our current levels of production and replace our imports from the Persian Gulf for more than 50 years.
But oil resources offer only a glimpse of the full picture. As I noted earlier, CRS found that America's combined recoverable natural gas, oil, and coal endowment is the largest on Earth. It's far larger than that of Saudi Arabia, China, and Canada combined. And - this is what really stuns me - that's without including America's truly massive deposits of oil shale and methane hydrates.
Let's take a look at what CRS says about natural gas. Based on the 2009 assessment from the Potential Gas Committee, CRS states that America's future supply of natural gas is 2,047 TCF. At today's rate of use, this is enough natural gas to meet American demand for 90 years.
The report also reveals that America is number one in coal reserves, with more than 28 percent of the world's coal. In fact, CRS cites America's recoverable coal reserves to be 262 billion short tons. For perspective, the US consumes just 1.2 billion short tons of coal per year. And though portions of this resource may not be accessible or economically recoverable today, these estimates could still prove to be conservative, as CRS states:
"...U.S. coal resource estimates do not include some potentially massive deposits of coal that exist in northwestern Alaska. These currently inaccessible coal deposits have been estimated to be more than 3,200 billion short tons of coal."
And let's not forget oil shale. With several pilot projects underway to prove oil shale's future commercial viability, the Green River Formation located within Colorado, Wyoming, and Utah contains the equivalent of 6 trillion barrels of oil. Let me say that again: 6 trillion barrels of oil. The Department of Energy estimates that, of this 6 trillion, approximately 1.38 trillion barrels are potentially recoverable. That's equivalent to more than five times the oil reserves of Saudi Arabia.
Another domestic energy resource that could lessen America's dependence on foreign energy is methane hydrates. Although still several years away from commercial feasibility, methane hydrates, according to the Department of Energy, possess energy content that is, "immense ... possibly exceeding the combined energy content of all other known fossil fuels."
While estimates vary significantly, the United States Geological Service (USGS) recently testified that: "the mean in-place gas hydrate resource for the entire United States is estimated to be 320,000 TCF of gas." For perspective, if just 3% of this resource can be commercialized in the years ahead, at current rates of consumption, that level of supply would be enough to provide America natural gas for more than 400 years.
For more than 400 years - that's what I call real energy security. This is an impressive piece of the largest energy resource base on Earth. This country cannot compete and cannot grow unless we develop our resources. So let's get to it. Let's end Obama's attack on affordable energy. That means stopping his cap-and-trade agenda and its mindless restrictions on our ability to develop and produce our own resources, right here at home.