America became a net importer of oil in 1951 due to the post World War II booming economy and the automobile. After 1951, our country’s energy policies have been primarily shaped by the supply and cost of global oil and gas prices.
In June 2005, oil prices set new highs of $60 per barrel and oil prices would go substantially higher in a few years. On August 8, 2005, President George W. Bush signed the bipartisan, Energy Policy Act of 2005. The new energy law was developed over concerns over energy security, environmental quality and economic growth.
The Energy Policy Act of 2005 provided tax incentives to encourage domestic energy production and efficiency. The tax incentives were provided for energy efficiency and conservation, renewable energy, oil and gas, coal and nuclear power.
The legislation resulted in technology breakthroughs in the oil & gas and renewable energy sectors. In the oil & gas sector, hydraulic fracturing (“fracking”) reversed America’s declining domestic oil & gas production. In the renewable energy sector, new technology improved wind turbine and solar panel performance, driving down the cost of power.
The Energy Policy Act of 2005 was the start an energy revolution in the United States. In August 2005, electricity in the United States was generated from coal (50.7%), nuclear energy (19.9%), natural gas & oil (19.0%) and renewable energy (10.4%).
In 2007, American utilities began to move from expensive coal and nuclear power to reliable, inexpensive wind, solar and natural gas. By April 2019, electricity in the United States was generated from natural gas & oil (47.77%), renewable energy (21.56%), coal (21.55%) and nuclear energy (8.95%).
Today, the cheapest forms of power in the United States without any tax incentives are onshore wind, solar energy and hydropower. The cost for electricity from coal-fired power plants is more than double the cost. More importantly, America’s move from coal to renewable energy and natural gas has resulted in a 12.5% decrease in greenhouse gas emission from 2005 to 2019.
No fossil fuel is renewable, and the world will eventually run out of oil, natural gas and coal. The world is consuming over 37 billion barrels of oil per year and finding less than 5% the annual production through enhanced recovery, fracking and conventional exploration.
British Petroleum estimates the world has approximately 50 years of proven oil reserves in the world. British Oil also estimates the world has approximately 80 years of proven natural gas reserves. The highest quality coal, Anthracite has been virtually mined out around the world, leaving only lower grade quality coal.
The renewable energy tax credits in the Energy Policy Act of 2005 expire on December 31, 2020. Will Congress be able to develop new energy legislation in the current polarizing political environment? Will America ever develop an energy policy that will not allow our country to be held hostage by foreign governments?
On July 30, 2019, the Senate Environment and Public Works Committee voted unanimously Tuesday morning to advance a broad bipartisan, fueling infrastructure for electric and hydrogen-powered vehicles. President Donald Trump has also tweeted out support for the bill.
The bill aims to establish a grant program that would be available to states, counties, municipalities, tribes and agencies working to make public charging infrastructure more widely accessible. The bill is expected to be brought before the full Senate in the fall of 2019.
The Senate and the House of Representatives are each developing bills to provide financial incentives for energy storage and extending renewable energy tax credits. There is strong bipartisan support for financial tax credits for major offshore wind projects from coastal states.
The utilities move from coal to renewable energy is driving down the cost of electricity across America. Accelerating the move from internal combustion engine cars, trucks and trains to electric vehicles will free America from volatile price hikes in the global price of oil, natural gas and coal.
Renewable energy offers America the opportunity to be energy independent. Renewable energy is reliable, sustainable and inexpensive. Contrary to many media reports, America is making progress moving from fossil fuels to renewable energy and reducing greenhouse gas emissions.
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