Opposition to the Energy Bill Passed

The American Gas Association (AGA) today announced its opposition to the Energy Bill (H.R.6) which passed the House. The bill includes several provisions that are detrimental to the nation’s natural gas customers by causing higher prices.

This recent Energy Bill H.R.6 discourages the expansion of natural gas distribution systems by increasing the depreciation period for natural gas distribution pipelines. In the Energy Policy Act of 2005 the depreciation period for these systems was reduced from 20 to 15 years. This policy encouraged the expansion of new systems and to replace aging equipment. After only three years, the current legislation proposes to reverse this policy. Without an effective delivery system, investments in natural gas infrastructure are very important because consumers will not have access to this clean domestic fuel. The new legislation will drive production down and prices up. Because of this likely outcome, the AGA opposes the bill.

“Responsible energy legislation should not only encourage increased use of natural gas but also ensure adequate supply. This legislation moves in the opposite direction,” said AGA President and CEO David Parker. “Higher taxes will reduce supply and result in higher prices for American consumers. Now is not the time to drive up energy costs.”

Building facilities and expanding production would benefit some regions of the country by boosting local economies. There are still many regions in the nation where pipelines do not even reach. These regions are subject to choose other energy sources that are more costly. Increased natural gas supplies would benefit the nation’s economic and energy outlook. This new bill also increases the tax on domestic natural gas production by repealing parts of Section 199. Higher taxes will reduce supply and result in higher consumer prices. Both outcomes are certainly not desired.

Natural gas is the cleanest domestic reliable fuel and with expansion, has the ability to meet the nation’s energy needs. Being sensitive to the environment of the future, natural gas reduces greenhouse gas emissions and is considered a viable resource to use because of this. Natural gas is the most efficient of the energy resources. Increased production and use of natural gas is a solution for improving the nation’s future energy outlook and reducing greenhouse gas emissions. Natural gas eliminates the threat of oil spills, oil contamination and environmental clean up. Because natural gas burns so cleanly, no unpleasant odors, soot, or ashes are left behind. Natural gas is non-toxic, not poisonous or harmful to humans. The new bill puts all this in jeopardy. Energy supply companies like Triple Diamond Energy Corporation agree that the passing of this bill is a step in the opposite direction for the natural gas industry. At a time when oil is becoming cost prohibitive, natural gas, with the passage of this bill, has potential to do the same.