Thursday, August 20, 2009

Natural Gas To Flex Lobbying Muscle

The natural gas industry has its back up against the wall. It got absolutely rolled by the Waxman-Markey bill which favors clean coal over natural gas, there is an oversupply of gas right now which has driven prices way down, and recent discoveries of gas deposits promise promise to skew the supply-demand curve even further.

As a result, the industry has made influencing Waxman Markey in the Senate its immediate priority. To that end, enter "America's Natural Gas Alliance," a new $80 million lobbying coalition that includes natural gas producers such as Chesapeake, XTO, and Devon Energy.

According to the Wall Street Journal:

"The gas-industry's goals in the Senate include incentives that will encourage power companies to switch to natural gas from coal and lead truck fleets to convert to natural gas from diesel. Lobbyists will also seek to limit companies' ability to atone for their pollution via carbon "offsets," such as planting trees overseas, which reduce the incentive to switch to cleaner fuels like gas."

However the Journal cautions that, "...the gas industry must overcome major hurdles. Other energy producers are also mobilizing. A major theme of the coal industry has been the relatively stable price of coal compared with volatile natural-gas prices. Meanwhile, major natural-gas consumers, including chemical companies and many utilities, oppose increased use of natural gas because it could drive up costs."