The United States sits atop massive energy resources that could, if developed, drive down energy prices and spur the economy. And the two presidential candidates’ energy policies approach this opportunity in very different ways, experts say.
The Government Accountability Office (GAO) issued a report in May predicting that the United States’ oil shale formation may be "equal to the entire world’s proven oil reserves."
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"We’re like the Saudi Arabia of oil shale," said Rep. Devin Nunes (R., Calif.).
This and other fossil fuel deposits not only are spurring hopes that North America could become energy independent, but also are raising fears among environmental activists.
The two candidates provide a "very, very clear difference" on energy policy, said Irwin Stelzer, an economics expert and senior fellow at the Hudson Institute.
The United States is "in the midst of" an energy boom, said Kenneth Green, an energy expert at the American Enterprise Institute.
But President Barack Obama does "not want to develop fossil fuel resources in the United States," Stelzer said.
The recent discoveries disprove the argument of environmentalists that we are running out of energy, and provide the government an opportunity. "This is going to be a policy driven, not a nature driven … result in the next four years," Stelzer said.
Obama and Republican challenger Mitt Romney sparred over energy early in the debate on Tuesday night. The president claimed to support the development of natural resources. "We have increased oil production to the highest levels in 16 years," Obama said. "Natural gas production is the highest it's been in decades."
"Everyone knows they are splitting words here," he said. Obama’s assertion implies government itself is increasing fossil fuel production, Nunes added, but "government has no business on private land."
The government only controls oil production on federal land, and "on federal land, it’s down and dropping fast," he said. "He’s being very deceptive, on purpose."
Stelzer agreed with Romney’s assertion in the debate that drilling permits under Obama have dropped. "It’s perfectly clear that the Obama administration has reined in the issuing of drilling permits," he said.
Any drop in oil imports is not due to anything "we, the government, have done," Nunes said.
He tied Obama to the "radical environmental element. … They believe global warming is more important than people’s jobs and livelihoods."
"They are for higher energy prices. Period," Nunes said about Obama’s administration.
Energy Secretary Steven Chu has said that he wants "to boost the price of gasoline to the levels in Europe," where it is more than double the current average U.S. price, in order to reduce gasoline consumption in the United States.
Romney highlighted in the debate the rise in gasoline prices under Obama:
And the proof, the proof of whether a strategy is working or not is what the price is that you're paying at the pump. If you're paying less than you paid a year or two ago, why, then, the strategy is working. But you're paying more. When the president took office, the price of gasoline here in Nassau County was about $1.86 a gallon. Now, it's $4.00 a gallon.
Experts agree that exploiting energy resources could provide a needed boost to the economy. The energy economy has been the only "bright spot over the past few years," Green said. He emphasized that developing these energy resources could be part of the recovery.
"Energy means lots of jobs," Republican Virginia Governor Robert McDonnell said. "There would be a tremendous boom for Virginia if we had a comprehensive energy policy."
McDonnell emphasized that Virginia has "every possible natural resource that you would want in ample supply: major coal and gas deposits … significant nuclear capacity … vast offshore resources in oil and natural gas and wind."
However, the federal government is holding back the development of these resources, McDonnell said. "I think we need to have changes at the federal level, especially when we’re trying to recover from this downturn in the economy that still has 23 million people who can’t work."
"Stop coming up with silly and unbalanced policies that hurt the ability of Virginia to use all of its God-given natural resources," McDonnell said.
Both McDonnell and Green hailed the ability of natural gas to cut greenhouse gas emissions. Green noted that switching from coal to natural gas has dropped greenhouse gas emissions as natural gas "puts out much less pollution than coal."
Many have argued that hydraulic fracturing or hydro-fracking could cause environmental harm.
But McDonnell pointed out that, if the government stops a 40-year-old process over environmental concerns, "You’re going to make the whole shale gas revolution tough to complete."
Proponents of fracking argue environmental concerns are overblown. Nunes said that fracking occurs "deep down in the earth," where there is only oil.
Green said that drilling for wells can cause water pollution, but that tapping such resources generates "very manageable environmental problems" with which the country has dealt for a long time.
Stelzer indicated that renewable energy sources championed by the Democratic Party are "very expensive," are often built in remote areas, and require massive infrastructure to transport the energy.
He also noted that "green" sources are not perfect, citing a lawsuit to stop solar panel development in the Mojave Desert because of environmental damage the panels cause.
Both fossil fuels and green energy sources "have environmental consequences," Stelzer said. "There’s no free environmental lunch" in the "energy business."
Stelzer did say that there are some social and environmental costs of fossil fuels that "are not reflected in the price," which means that "solar and wind are competing with products that are underpriced." Stelzer is in favor of a carbon tax that would account for these hidden costs.
Subsidies also mean that "people are not buying this sort of stuff" at market prices, Stelzer said, and the money often goes to rich people who can already afford the more expensive price tag for items such as electric cars.
The newly discovered deposits could spur the economy, drop energy prices, and create jobs, but the government will have a large role to play in developing these resources.
"All we’re asking for is, let’s have a balanced program between environmental protection and job creation and low energy prices," McDonnell said.