Yesterday the House Committee on Small Business’s Subcommittee on Agriculture, Energy and Trade held a hearing on the Keystone XL and Small Business.  This hearing is that most recent in a number of hearings held by the House to talk about the importance of the Keystone XL pipeline project.

There were four witnesses, one of which was Mr. Peter Bowe, an NAM member, the President and CEO of Ellicott Dredge Enterprises, LCC. Ellicott Dredge makes dredging equipment that is used in the processing and the reclamation of tailing ponds at the mining site. President Obama is visiting the Ellicott Dredge facility in Maryland today to discuss infrastructure.

The other witnesses included Mr. Brent Booker, Secretary Treasurer, Building and Construction Trades Department, Department, AFL-CIO, ; Mr. Mat Brainerd, President, Brainerd Chemical Company, Tulsa, OK; and Mr. Christopher Knittel from the Center of Energy and Environmental Policy Research, Massachusetts Institute of Technology.

Peter’s business is a small business with about 200 employees in four locations, Maryland, Wisconsin and Europe. For Peter and the Ellicott Dredge organization, the Keystone XL is critical because it will move oil more quickly and result in additional demand. As oil demand increases so does the demand for his products and will result in $10s of millions of dollars being spend within his supply chain. These are small and large companies located throughout the United States. The ripple effect of spending within his supply chain is substantial and impacts a number of smaller communities throughout the country. (continue reading…)

Early this afternoon the Senate Committee on Energy and Natural Resources passed S. 761, “The Energy Savings and Industrial Competitiveness Act,” more commonly known as the Shaheen-Portman  bill after its two authors, Sens. Jeanne Shaheen (D-NH) and Rob Portman (R-OH). The 22-member Committee passed the bill on a strong voice vote with only three Senators castings votes in opposition.

The only amendment that was offered (and agreed to) was a manager’s amendment from Sen. Portman. The bill’s sponsors received unified praise from Senators during the markup for their bipartisan efforts and their work to promoting energy efficiency. Chairman Ron Wyden (D-OR) requested that Senators hold their amendments until the legislation reached the floor of the Senate.

The Committee went on to discuss a number of possible amendments and issues that might be addressed on the floor. It was clear that there was great interest in expanding the scope of this legislation, with a number of Senators discussing the issues they would like addressed.  This is obviously a bit of a Pandora ’s Box but at least Senators are talking about floor action on energy, which hasn’t happened in a long time.

Manufacturers continue to urge Senator Reid to bring this bill to the floor as soon as possible. Energy efficiency is vital to manufacturers’ ability to compete, and this bill should be a no-brainer given its potential for job creation and energy savings. And it is a great way to start bridging some of the divides that have too long prevented the Senate from having a constructive legislative debate on energy policy.

Chip Yost is assistant vice president of energy and resources policy, National Association of Manufacturers.

Yesterday Senator McConnell and Rand introduced the “Coal Jobs Protection Act” in response to a number of regulatory actions taken by the Environmental Protection Agency (EPA). Rep. Capito introduced a companion bill in the House this afternoon as well. The focus of the McConnell bill is jobs and to slow the EPA’s efforts to regulate coal usage out of our energy mix.

The coal industry in Kentucky directly employs 14,000 workers and accounts for an additional 52,000 workers indirectly.  Over the last several years both coal production and employment have dropped significantly in the Bluegrass State. Coal production is down almost 28 percent and over 4,000 coal miners have lost their jobs.

Too often the EPA has dragged its feet on approving various water permits ranging for 402 to 404 by delaying action on these permits that are needed to begin work on coal related projects. EPA’s own web site they list almost 40 402 (national pollutant discharge elimination into navigable waters) permits that have been waiting for action since 2008. This legislation would require EPA to provide 402 applicants a yes or no within 270 days of the application.

It would also require EPA to begin the authorizations process on 404 permits (fill and dredge permits) within 90 days of receiving the application. EPA’s slow walking these permits costs communities, businesses and workers thousands of jobs and millions of dollars in economic benefit in addition to millions of dollars in lost coal severance money that would have gone to the state and local communities.

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The Energy and Commerce’s Energy and Power Subcommittee held a hearing today on Rep. Lee Terry’s H.R. 3, the Northern Route Approval Act. This legislation would deem all environmental requirements completed and would no longer require the President to sign a permit to approve the pipeline.

This was the subcommittee’s third hearing in the past several years on the Keystone XL project. Those in support of the pipeline emphasized the positive economic impact of the pipeline in terms of jobs, manufactured goods, increased tax revenues and the increased energy security. Those opposing the project emphasized climate change, reducing the carbon footprint, the refining of heavy oil and the ongoing reliance on fossil fuel.

However, there were a few nuggets worth repeating.

Chairman Whitfield noted that that manufactures and businesses have reduced carbon emissions on the environment over that last 20 years.

David Mallino of the Laborers International Union of North America pleaded with subcommittee members to support the legislation and “clear away roadblocks” to this project. Mr. Mallino pointed out that this project will provide opportunities for many different craftsmen, and that this pipeline will be built by union members and would result in millions of man hours. (continue reading…)

Earlier this week Governor Mary Fallin, of Oklahoma,  wrote Jeffrey Zients, the Acting Director of the Office of Management and Budget (OMB)  about the Bureau of Land Management’s (BLM) proposed rule on hydraulic fracturing on Federal and Indian lands.  Governor Fallin sent Mr. Zients a copy of a study done by the Oklahoma City University’s Economic Research & Policy Institute on the “Individual Well Costs from Proposed Rules Changes to Oil and Natural Gas Operations on BLM Lands” The study was commissioned by Devon Energy. The Governor encouraged OMB to review this study and reconsider the proposed rule.

Six weeks ago the BLM determined based on the thousands of comments they received on their proposed rule regulating these activities on federal lands that they needed to take another look at the entire rule. At that time we stated the following:

“This afternoon, in a victory for manufacturers and energy producers the U.S. Department of Interior’s Bureau of Land Management (BLM) announced it would redraft a proposed hydraulic fracturing regulation for wells operated on federal and Indian lands.  The original rule sought to make radical changes to the chemical disclosure and well construction procedures oil and gas drillers must follow before they can receive their permits to drill”. (continue reading…)

What a difference a month makes. The Chicago Federal Reserve Bank said that it’s National Activity Index (NAI) shifted from -0.49 in January to +0.44 in February. January’s data reflected a drop in industrial production and reduced housing starts, among other challenges. More importantly, negative numbers indicate that the U.S. economy was growing below its historical trend, and when the 3-month moving average falls below -0.70, the risk of recession is increased. As such, the January NAI suggested that the macroeconomy was headed in the wrong direction.

The latest data, though, suggest that there was definite improvement in February, with manufacturing playing a key role. Industrial production rebounded in February, increasing 0.8 percent. That helped boost the manufacturing contribution to the NAI by 0.34 points, a significant swing from the 0.30 drag on the index the month before. Higher nonfarm payrolls, sales, and housing permits were also positive factors. With that said, because housing data remains well below where it was a few years ago, the sector continues to have a negative contribution overall.

Despite the higher monthly NAI, the three-month moving average edged lower, from +0.28 in January to +0.09. Nonetheless, this value still indicates an economy that is growing above its historical average, even if it is not growing strongly.

This data is consistent with the Leading Economic Index report issued last week from the Conference Board. Overall, the U.S. economy is experiencing moderate growth, with manufacturers cautiously optimistic about increased activity moving forward. Still, there continue to be headwinds, and it will be interesting to see how the across-the-board federal spending cuts impact growth moving forward, particularly as we move into the second quarter of 2013.

Chad Moutray is chief economist, National Association of Manufacturers.

Today President Obama urged Congress to establish an “energy security trust” which would take a portion of federal revenues from oil and gas production on federal lands and earmark them for research in advanced vehicle technology which would include cars fueled by electricity, bio cells, natural gas and biofuels.  The goal would be to earmark $2 billion over the next 10 years for research in these areas. Initially the President spoke about his plan during the State of the Union speech in February.

The President visited the Argonne National Laboratory in Chicago for his speech today. This federal lab has been working on advanced vehicle technology since the 1990s with a focus on advanced car batteries. During his visit he again spoke about an “energy security trust.” While much of what he said was positive and good we can’t afford to focus on just a few fuels. We need to continue basic research on all types of fuels. Advance vehicle technology research is critical if we are to continue to increase the efficiency of our cars and trucks. The research of today will reduce vehicle fuel consumption and the impact of vehicles on our environment in the future.

As part of his plan the President said he is looking for a pilot program to remove the “bottle necks” from the permitting process in North Dakota’s Bakken Shale Formation. This is great news,  the White House finally understands that the permitting process is taking far too much time and is the “bottle neck” in the production process.  This should not be a surprise. The energy sector has been talking about these permitting bottle necks for years! We hope the Administration and the President understand that it has been the federal government that has created barriers to production and slowed our exploration efforts.

Second, I found it interesting that the President would pick the Bakkens for a pilot project given that most of the production in the Bakken Shale Formation is taking place on private lands where the federal permitting process is not an issue. The fact is that for the last 6 years most all of the new production has taken place on private lands. Most of the shale gas development is on private lands. If we had to rely solely on federal lands for oil and gas development we would still be building import facilities for LNG! (continue reading…)

The past two days we have seen strong bipartisan efforts from both chambers of Congress to move forward with approval of the Keystone XL pipeline. In a time when you don’t seen much partisan agreement, members from both sides agree that Keystone XL would be good for our economy and energy security.

Just today Congressman Lee Terry introduced legislation in the House that would approve Keystone XL. The legislation has support from House Democrats John Barrow and Jim Matheson who both attended a press conference this morning urging passage. House Energy and Commerce Committee Chairman Fred Upton said he was aiming to get the bill to the floor of the House by Memorial Day.

Yesterday, Senators Baucus and Hoeven unveiled bi-partisan legislation that would approve the Keystone XL pipeline without any further action required by the President, or the Department of State. Baucus and Hoeven were joined by 12 other Senators in support of their legislation and these Senators were evenly divided between democrats and republicans (Sens. Mark Begich (D-Alaska), Lisa Murkowski (R-Alaska), Pat Roberts (R-Kan.), John Cornyn (R-Texas), Joe Manchin (D-W.Va.), Mary Landrieu (D-La.), David Vitter (R-La.), Heidi Heitkamp (D-N.D.), Mark Pryor (D-Ark.), James Risch (R-Idaho), Jon Tester (D-Mont.) and John Barrasso (R-Wyo.).

Most people will tell you that Washington is broken and that they can’t get anything done. Despite the current state of the Senate and House there are issues and areas where Democrats and Republicans want to work together and are reaching across the aisle to do so. This is a good example of members of the House and Senate understanding the importance of this energy project and what it will mean in terms of energy security, economic growth and a better relationship with our Canadian neighbors.

The Canadian oil sands will continue to be mined, refined and exported regardless of what happens to the Keystone XL project. The question has never been if oil will be exported, it has been where will be exported. Keystone XL is about economic growth and having the energy to power the economic growth.

Manufacturers use one-third of the energy consumed in this country and in many instances lower energy costs are allowing us to complete in a global market place in ways that we have not been able to do for years. Oil from Canada allows us to rely less on countries throughout the world that are hostile to America and our way of life.

These members of Congress understand the importance of this project in terms of economics, national security and energy. They are willing to put partisanship aside to do what is best for our country and our economy.

Chip Yost is assistant vice president of energy and resources policy, National Association of Manufacturers.

This morning Senator Vitter (R-LA) and Congressman Bishop (R-UT) will introduce the Energy Production and Project Delivery Act of 2013. This legislation focuses on increased access to resources on federal lands and streamlining the regulatory process. The NAM supports this legislation and applauds its objectives. Manufacturers, which use one -third of our nation’s energy, need access to competitively priced energy in order for us to compete in the global economy and preserves high paying jobs in the United States.

Increasing access to domestic sources of reliable energy, both onshore and offshore, is essential to the long-term health of American manufacturing. For the first time in decades we have an advantage in energy costs and it is vital that we maintain that advantage if we are to remain competitive. While investments in new energy sources and efforts to boost efficiency gains play critical roles in meeting our nation’s future energy demands we cannot ignore the vital need to develop and utilize our domestic sources of energy.

Further, we can ill afford to place critical resources off limits and it is important that we open up additional areas in the Outer Continental Shelf (OCS) and the Alaska National Wildlife Reserve (ANWR). This would allow for greater exploration and responsible development of promising areas offshore and in the Arctic – all of which could substantially lower our nation’s energy vulnerability with minimal environmental impact. A study by Wood Mackenzie Energy Consulting concludes that policies encouraging domestic oil/gas exploration could add 1.1 million jobs by 2020 and 4 million barrels’ of oil and natural gas per day.

The revenue sharing provisions in this legislation will provide the offshore producing states would provide states with an additional $3 billion a year in revenues. All of this paid for by increased production and additional leases.

Regulatory streamlining continues to be a top priority for manufacturers. The National Environmental Policy Act (NEPA) is in desperate need of streamlining as it environmental and judicial review process can take years to complete. There are hundreds of projects from pipelines to power plants to manufacturing facilities that are being held up by an overly burdensome federal regulatory process. For example, this legislation would require EPA to do a complete economic analysis of the impact of regulations on employment under the Clean Air Act. It also would expedite the permitting of the Keystone XL Pipeline which has been under regulatory review since 2008.

We hope that the Senate will seriously consider this legislation and begin the legislative process quickly. Manufacturers are a vital part of our nation’s economy and affordable domestic energy supplies are vital to manufactures.

Chip Yost is assistant vice president of energy and resources policy, National Association of Manufacturers.

The U.S. House of Representatives voted overwhelmingly, 422-0, in favor of a bi-partisan piece of legislation, H.R. 267, would streamline the process for approving certain hydroelectric development and thus allow the use of smaller hydro projects and conduit hydro projects.  The legislation also directs Department of Energy (DOE) to conduct a study on pumped storage project opportunities and to study potential hydropower from existing conduits.

There are two things that strike me about this legislation. First, it appears sensible and straight forward. It has a goal of increasing electricity generated from a renewable source. Second, it is a bi-partisan piece of legislation with members like Reps Rogers, Terry, Walden and Latta supporting it from one side of the isle and Reps. DeGette, Dingell, Markey, Matheson and Lujan on the other side. This is exactly the kind of legislating that we should be doing more of where we find areas that we can agree and we then go out and get it done!

The NAM supports the streamlining of the regulatory process for hydroelectric power development through the elimination of redundant or contradictory regulatory steps and avoiding the imposition of conflicting clauses in other legislative initiatives.

The NAM embraces an “all of the above” energy strategy and hydroelectric power certainly fall into that category. Hydropower is a renewable resource that is clean, efficient and is responsible for more of the Nation’s renewable energy supply than any other source of renewable energy. Hydro provides 67% of the domestic renewable energy and 7% of the total electricity generation. As we streamline the regulatory process and build more hydroelectricity capacity there are job opportunities. (continue reading…)