Without More Pipelines, Scary Economic Scenarios Become Real

Without More Pipelines, Scary Economic Scenarios Become Real

Energy costs are “affordable” up until a certain point. That tipping point, experts agree, is when costs exceed 6 percent of a household’s income. 

Despite the occasional moans and groans when paying the utility bill, like after the holidays, many U.S. families don’t always feel the crippling pain of paying more than they can afford for energy. The electric bill rarely breaks the bank for them.

Unfortunately for others, it does. In 2011, roughly 23 million people required some sort of federal assistance to pay for electricity or home heating, per the U.S. Department of Health and Human Services.

That’s because lower-income families spend a larger percentage of their disposable income on electricity, heating and transportation costs than those in other income brackets. In fact, their percentage can be 20 percent or more. 

It’s enough to crush any budget.

That’s why price spikes in energy often act as a regressive tax for cash-strapped families, seniors living on fixed incomes and households with incomes below the poverty level. Unlike other necessities, like housing, food and health care, these households oftentimes cannot shop elsewhere for cheaper energy. An unnecessary increase in energy prices means they fall even more behind. 

The last thing these families want is for their bills to unreasonably increase. Yet without more investment in America’s energy infrastructure, that’s exactly what’s going to happen.

And unfortunately, a few misguided activist groups who oppose new, state-of-the-art pipelines are increasing the burden on households and small businesses. 

Because Americans have become increasingly reliant on natural gas to meet their electricity needs, and because many continue to rely on oil for heating and transportation fuel, Consumer Energy Alliance (CEA) initiated a report on the U.S. oil and gas pipeline network and its requirements to meet growing domestic energy needs.

The findings revealed that the U.S. could lose a whopping one-third of its total electricity generation capacity, or 1,450.25 gigawatts, if policymakers prematurely shut off more baseload power or reject proposals for pipeline expansion. Since one gigawatt powers about 750,000 homes, that’s equal to the power generation needs of California, Florida, New York, Texas, Ohio and all New England, combined.

Eliminating this much generation would threaten the reliability of the electric grid and stir more economic hardship via skyrocketing electric rates, especially for the 43 million living on a fixed income or below the poverty line.

Rejecting pipeline proposals would also reduce energy security benefits and U.S. geopolitical leverage by increasing America’s reliance on imported energy, again increasing costs on those who can least afford it. In fact, halting pipeline expansion could result in abandoning more than 3.17 million barrels of oil per day – nearly identical to what was imported daily from Russia and OPEC in 2015.

These scenarios would cause competitive disadvantages for U.S. businesses, an avalanche of lost jobs in professions like manufacturing, packaging, transportation, mining and agriculture, and a minimum loss of $15.38 billion in private capital expenditures and economic development.

Furthermore, the cost of virtually every U.S.-made good and service would rise, since oil and gas help to make just about everything that touches our daily lives, including the clothes we wear, the shampoo we use, the carpet we walk on, the medication we take and the food we eat. If the price of a key ingredient in the manufacturing of those goes up, so does its price tag. 

Fewer natural gas and oil pipelines also means greater potential environmental harm. Studies show that moving energy by pipeline is 4.5 times safer than moving the same volume across the same distance by other means, and 99.999 percent of energy moved via pipeline safely reaches its destination

Investing in our energy infrastructure, alleviating our bottlenecked pipeline system, helping to lower our mounting electric rates, and continuing our strong record of environmental progress is a winning combination, for everyone – most of all, the tens of millions who already pay far more than they should just to keep the lights on and live their lives.

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