Obama Administration Supports Fracking and Natural Gas, Despite Environmental Opposition


By Steve Goreham

Originally published in The Washington Times.

Last Thursday, the US Department of the Interior released a draft proposal that would “establish common-sense safety standards for hydraulic fracturing on public and Indian lands.” Last Friday, the US Department of Energy (DOE) approved a Liquefied Natural Gas (LNG) terminal in Freeport, Texas. Despite opposition from environmental groups, the Obama administration apparently supports the expansion of the natural gas industry and the controversial technology of hydraulic fracturing. These events are welcome common sense from an administration that is typically deep in green ideology.

Good old Yankee ingenuity has produced a new hydrocarbon revolution. Vast quantities of oil and natural gas can now be recovered from shale rock formations, thanks to enabling technologies of hydraulic fracturing (or fracking) and horizontal drilling. US crude oil production in 2012 was up 30 percent since reaching a low in 2008. Natural gas production is up 33 percent since 2005. Bob Dudley, CEO of BP, forecasts that the United States will be “nearly self-sufficient in energy” by the year 2030.

Fracking is not new, but has been perfected over the last 20 years to allow cost-effective recovery of hydrocarbon fuels from shale. Water and sand, along with a small amount of chemicals, are injected under pressure to fracture the shale and create millions of tiny fissures, releasing the trapped gas or oil. To develop a large producing field, horizontal drilling is used to bore mile-long horizontal shafts into the shale. Fracking is typically used at depths greater than 5,000 feet.

But hydraulic fracturing is under assault from environmental organizations. According to the Sierra Club, “Fracking, a violent process that dislodges gas deposits from shale rock formations, is known to contaminate drinking water, pollute the air, and cause earthquakes.” A 2011 letter from Friends of the Earth, Greenpeace USA, Climate Protection Campaign, and other groups urged President Obama to “halt hydraulic fracturing…until and unless the environmental and health impacts of this process are well understood and the public is adequately protected.”

The draft rule released Thursday from the Department of the Interior acknowledges that hydraulic fracturing can be conducted in an environmentally safe manner. It calls for disclosure of chemicals used in fracking, assurances of well-bore integrity to prevent leakage of gas and fluid into ground water supplies, and confirmation of a water management plan for disposal of water and fluids used in the fracking process. Indeed, fracking has been used more than 500,000 times over the last 50 years without incidents of water contamination when proper safeguards were employed.

The hydrofracturing revolution has created a glut of natural gas in the US market. Prior to wide-scale use of fracking, natural gas prices reached $15 per million British thermal units (Btu), and port facilities were being constructed to import LNG. By 2011, prices had fallen to $4 per million Btu and import terminals sat idle.

Unlike crude oil, which is priced and sold in a global market, natural gas is priced and sold regionally. To date, the fracking revolution has been a US phenomenon, with other nations slow to join. While US gas prices have dropped to under $4 per million Btu, Europe’s prices remain above $10, and the price of imported LNG in Japan is above $15.


US producers now see an opportunity to liquefy the gas and ship it to Europe and Japan. Twenty applications have been filed with the Department of Energy (DOE). The approval last week of the Freeport export terminal in Texas is the first since 2011. The $10 billion terminal plans to export up to 1.4 billion cubic feet of natural gas per day, or about two percent of annual US consumption.

Environmental groups have criticized the approval. “Exporting LNG will lead to more drilling―and more drilling means more fracking, more air and water pollution, and more climate fueled weather disasters like last year’s record fires, droughts, and superstorms,” according to Deb Nardone of the Sierra Club. Nevertheless, it appears that the Obama administration will support hydraulic fracturing and the growth of the natural gas industry.

Shale gas booms in Texas, Louisiana, and Pennsylvania have created tens of thousands of jobs. Low natural gas prices are attracting global chemical firms to build plants in the US. Thousands of additional jobs and tax revenues can come from LNG exports. Sound energy policy demands that fracking and export of natural gas be allowed, if environmental safeguards are met.

Steve Goreham is Executive Director of the Climate Science Coalition of America and author of the new book The Mad, Mad, Mad World of Climatism: Mankind and Climate Change Mania.

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May 22, 2013 10:08 pm

let’s face it, the fat lady has sung:
Deutsche Bank’s CO2 offset portfolio for sale: sources
LONDON, May 22 (Reuters Point Carbon) – Deutsche Bank is hunting for a buyer for its U.N. carbon offset portfolio, once worth hundreds of millions of dollars, two sources said on Wednesday, as the German bank seeks to sell one of the last pieces of its shuttered global carbon trading business…

Aussie Luke of Australiastan
May 22, 2013 10:42 pm

Waddles Gillard goes “Laaaaaaaaa…..”

May 22, 2013 10:52 pm

“…more climate fueled weather disasters like last year’s record fires, droughts, and superstorms,”

Laughed. Out loud. Really.
Actually sounds more like a threat than a warning… however, stupid is as stupid says…

May 22, 2013 11:18 pm

Money for a third term.

Roger Knights
May 22, 2013 11:22 pm

By making exports easier, the price of domestic natural gas will rise, which will make it less competitive against “renewables” in competing for contracts for power plants. That’s the plan of Obama’s advisors, I believe.

May 23, 2013 12:43 am

in Australia it is a big issue the gas mob want to frack all over the country including under sydneys water supply dam the Gov’t is backing them and the average Australian have been told to get lost as we need the money so we can wast it on stupid things like carbon reduction

Grey Lensman
May 23, 2013 1:04 am

Morgo, as I am not Australian, I will say it for you. Ford now closes down production in Australia because of the carbon tax but they cannot say that, they have to say “cost base too high”. see latest BBC report. Price for everything.

Larry in Texas
May 23, 2013 1:50 am

Simply amazing. This sudden burst of common sense won’t last, especially if the Sierra Club and other environmental groups sue EPA over the new rules. EPA will find a way to fold like a canvas tent. But at least it is a start. If only the administration would now approve the exploration of the Outer Continental Shelves and the shale oil that lies underground in this country. We might actually have a real economic recovery.

Grey Lensman
May 23, 2013 2:47 am

Environmental groups have criticized the approval. “Exporting LNG will lead to more drilling―and more drilling means more fracking, more air and water pollution, and more climate fueled weather disasters like last year’s record fires, droughts, and superstorms,” according to Deb Nardone of the Sierra Club
Is that the same Sierra Club that took 25 million in contributions from Chesapeake Gas?
If tes, that needs to be widely distributed.

Bruce Cobb
May 23, 2013 3:53 am

Obama is faced with a tough choice: On the one hand is the economic prosperity and strength of a nation with an ample supply of its’ own cheap energy, and on the other is the rabid anti-American demagogy of Enviromania such as that displayed by the Sierra Club. Like a wayward child, he should be applauded when he makes the right choice.

Chuck Nolan
May 23, 2013 4:01 am

Actually it makes sense for Obama to approve fracking.
If the economy improves Democrats gain votes.
And they lose nothing because who else will the tree huggers vote for?

May 23, 2013 4:03 am

I hope the rules are “common sense”. I am suspicious. The Green River Shale formation in SW Wyoming, N Colorado and NE Utah lie mostly under land controlled by the Dept of the Interior (BLM). The hydrocarbon potential in the Green River Shale Formation is huge. More oil is trapped in it than the entire Middle East. If we could now start to explore and develop that resource the benefit to our people would be correspondingly big. We need to remember who really owns public land. Not the government, per se, but the governed. OurGovernment needs to manage the resources to our benefit.

May 23, 2013 4:29 am

But then there is this:
” Obama’s Energy Secretary Says Climate Change Not Debatable
by William Bigelow 23 May 2013, 3:40 AM PDT
Ernest Moniz, Barack Obama’s new Secretary of Energy, is making it clear there is no room for dissent regarding climate change. Speaking to his department’s employees after he was sworn in, Moniz said, “Let me make it very clear that there is no ambiguity in terms of the scientific basis calling for a prudent response on climate change. I am not interested in debating what is not debatable. There is plenty to debate as we try and move forward on our climate agenda.”


Tom G(ologist)
May 23, 2013 4:43 am

One comment from an insider in the industry.
It is spelled: F-R-A-C-I-N-G. There is no ‘K’ i the word fracturing. If you want to use our term, please use it correctly.

May 23, 2013 5:07 am

Regarding the new Energy Secretary’s pronouncement: Didn’t the Inquisition tell Galileo that “The Science is not Debatable”???

Matthew R. Epp, P.E.
May 23, 2013 5:10 am

@morgo says:
May 23, 2013 at 12:43 am
Although I am not familiar with your countries particular geography, I suspect that fracing below the water supply will result in no change to the water quality, but will enhance your countries economic prosperity. Fracing is necessary to release gas and oil trapped in rock formations typically more then 1 mile below the surface. In North Dakota’s Bakken field, the depths vary from 7500 ft to 11000 feet depending upon local topography.
The potable water table stops at roughly 2000 ft, which is a seriously deep well for domestic water. Thus the water is separated by 5000 to 9000 ft of various rock formations, several of them are barrier formations that further isolate the gas/ oil bearing formations from the upper water bearing formations.
Typical drilling sequence is to drill a surface hole, approx 13″ in diameter to a depth below the water bearing rock. The drilling stops, and a steel ling is installed and cemented into the rock formation, sealing off the water bearing rock.
After surface casing is complete and the water sealed off, then the next phase of drilling occurs using a smaller bit and smaller hole approx 9″ in diam, to the oil/ gas bearing formationi. Once this is achieved, then a steel sleeve is installed and cemented to the rock formations. This second laey of casing also overlaps the bottom of the surface casing to prevent any loss of oil/ gas or contaminationi of ground water.
After this casing is complete, then a smaller bit is used to drill horizontally making a 6″ diam lateral hole up to 12,000 ft depending on local conditions, through the oil/ gas bearing formation. Once this lateral is complete, a 4-1/2 ” steel sleeve is run into the lateral to maintain hole integrity and cemented to the formation. After this is complete they begin the proceedures for fracing.
Because of these procedures, over 500,000 wells have been drilled and fracked with no contamination of the water supply.
Don’t let your fears and politics rob you of the truth. Fracing is safe virtually every time.
Matthew R. Epp

May 23, 2013 5:14 am

Apparently the new energy secretary thinks he now has the power to end scientific debate.
Someone should ask this new fool in town (from MIT, home of fools) which of the twenty five different global warming models is not debatable. Don’t the Dems know ANYONE with a brain?

May 23, 2013 5:17 am

So how long before James Hansen erupts and pronounces Obama the enemy?

May 23, 2013 5:26 am

Environmentalists are learning : you don’t trust a crook.

May 23, 2013 5:33 am

“It is spelled: F-R-A-C-I-N-G. There is no ‘K’ i the word fracturing. If you want to use our term, please use it correctly.”
It is being used correctly, and the spelling you claim is bogus in our language – a hard “C”
cannot occur when followed by an “i”. If you want a K sound, you must use a K.

Mike jarosz
May 23, 2013 6:50 am

Obama is a politician. He will be on whatever side is winning . Liberals call it evolving.

Tim Clark
May 23, 2013 6:57 am

“Exporting LNG will lead to more drilling―and more drilling means more fracking, more air and water pollution, and more climate fueled weather disasters like last year’s record fires, droughts, and superstorms,” according to Deb Nardone of the Sierra Club.”
Typical self-loathing liberal , delusional, narcissist.

May 23, 2013 7:08 am

Matthew R.Epp,P.E. I hope you are right in what you are saying because there is a lot of experts saying the opposite to what your saying

May 23, 2013 7:34 am

Morgo–please provide a list of these “experts” that say the opposite regarding fracking; as a geologist and mining engineer, I’d like to evaluate their credentials, vested interests, political persuasion, and overall grasp of the subject. From what I know, Matthew is pretty much correct in his analysis.

May 23, 2013 8:01 am

The Sierra Club is spitting into the wind and Obama knows it.

May 23, 2013 8:07 am

These events are welcome common sense from an administration that is typically deep in green ideology.
I thought you were going to say the equally correct “…from an administration that is typically lacking common sense.”

May 23, 2013 8:38 am

@Matthew R. Epp
“Don’t let your fears and politics rob you of the truth. Fracing is safe virtually every time.”
Google auto corrects “fracing” to “fraking”. Its not the fracking at depth that’s the problem, but improper disposal of the hazardous waste water used in the process. It’s always the cheaters cutting corners to save a buck that require all the regulations/laws in an attempt to keep them in line with the threat of fines & punishment. Just imagine how efficient and inexpensive life would be without them. A primary example is the 2008 meltdown as the result of gradual dis-assembly of banking regulations (1933 Glass-Steagall Act). There are many other examples over the decades and it appears that industry suggestions as to which regulations should be removed/modified are almost always the ones that they are ready to take advantage of, many times in what would certainly be unethical but also criminal. Unfortunately (or maybe on purpose) legislators appear to have a historical loss of memory when considering regulation reduction, but I don’t suppose that political contributions have anything to do with it.

Tim Clark
May 23, 2013 8:49 am

Matthew R. Epp, P.E. says:
May 23, 2013 at 5:10 am
In the KS-OK area of the shale fracking, salt water disposal is of more concern than the actual fracking.

Tom G(ologist)
May 23, 2013 9:34 am

To Arthur 4563
“It is spelled: F-R-A-C-I-N-G. There is no ‘K’ i the word fracturing. If you want to use our term, please use it correctly.”
It is being used correctly, and the spelling you claim is bogus in our language – a hard “C”
cannot occur when followed by an “i”. If you want a K sound, you must use a K”.
Our language, as you note, icludes MANY examples of ‘words’ which derived from industry-specific technical terms. Does your rule occur in the grammar book following “i after e except after c”?
But I should thank you for establishing the new accepted norm that an industry which invents a term is not allowed to devise its spelling, but, rather must adhere to a set of orthographic guidelines which allow for words like through, to be substituted by thru – even in public signs.
Thank you Mr. Grammar for correcting an industry which has used its own term for 60 years

Tom G(ologist)
May 23, 2013 9:46 am

Morgo and rocky road
The ‘experts’ who might disagree about the safety of fracing do not matter. First, no-one who is actually an expert in oil and gas drilling concludes there is a risk to potable groundwater supplies, but we do not need to rely on expertise. We have 60 years of hard data that document the safety of the method. Please, let’s not take the route of AGW activists and ignore the actual data in favor of ‘expert’ opinions. And while I am here, the statement that there are a lot of experts who think fracing is dangerous sounds a lot like the beginnings of yet another consensus debacle.
Please stop it and educated youself. There are public records of every well drilled and performance tests and hydraulic communication tests and potable water supply tests, and micro-seismic mapping of each frac stage in thousands of wells, and ….. ad infinitum.
Have these ‘experts’ sift the data as the industry does and publish their findings to document that there has been a single impact to potable groundwater supplies as a result of hydraulic fracturing. They won’t be able to, because such data synthesis has been and continues to be done continuously and there has been no evidence of ANY comunication from deep reservoirs to potable groundwater.
What we see so far is a pathetic parody of AGW arm-waving with no substance behind it.

May 23, 2013 10:28 am

The Obama administration is still sitting on the Keystone XL pipeline. Which, if he had his druthers, our current President would never allow to be built.
I’ll believe the news about fracking and LNG exports when his administration actually allows each to happen.

May 23, 2013 10:48 am

You would think that people like Deb Nardone would be embarrased by such a display of their ignorance, delusion and mean-spiritedness, but then the greenies have no shame, and reason and facts simply don’t play with them.

May 23, 2013 11:01 am

If I remember correctly the correct industry term and spelling is frac’ing (a contraction of the word fracturing). That explains the spelling and the pronunciation

P Walker
May 23, 2013 11:02 am

The problem that nat gas producers face is that the current price is about at the break even point for conventional drilling . Hydraulic fracturing is more expensive , so producers are either losing money or just keeping their heads above water . In other words , gas is too cheap to be worth producing so production will fall and prices will rise .

May 23, 2013 11:41 am

P Walker says:
May 23, 2013 at 11:02 am
“The problem that nat gas producers face is that the current price is about at the break even point for conventional drilling . Hydraulic fracturing is more expensive , so producers are either losing money or just keeping their heads above water . In other words , gas is too cheap to be worth producing so production will fall and prices will rise .”
Not necessarily!
America is producing more natural gas today with fewer than 400 active rigs than in 2008 with more than 1,600 rigs
5. At the same time that the number of active gas rigs has declined by more than 75%, the amount of natural gas produced has continued to increase to record levels (see red line in middle chart). The bottom chart above shows the significant increase in the amount of natural gas produced per active rig over the last five years. In the first part of 2008, there was an average of about 1.4 billion cubic feet of natural gas being produced monthly for each rig, and now about 6 billion cubic feet of gas is being produced monthly per rig. In less than five years, there has been more than a four-fold increase in the amount of gas per rig.
In a previous CD post, a recent Forbes article was quoted that explained why we’re getting more gas from fewer rigs – because energy companies are “getting better over time at maximizing recoveries from each well” and those efficiency gains translate into the significant increases in gas output per active rig illustrated in the chart above. Increased gas output with fewer rigs also translates into lower production costs for domestic producers and helps to offset some of the loss of revenue from lower gas prices. The fact that we’re able to continue to produce record amounts of natural gas with only 389 active rigs (which is 25% of the active rigs that were in use at the peak in 2008, and 1,217 fewer) is another part of the amazing energy story in America, which came about because of the breakthrough drilling technologies and the many “petropreneurs” who used those revolutionary techniques to rejuvenate US oil and gas production”

P Walker
May 23, 2013 12:09 pm

Dave Wendt
@ 11:41 am
That’s not what my general partners and my royalty checks tell me . Check the comments at the end of your link .

May 23, 2013 12:27 pm

Finally something sensible out of the Obama administration.

James at 48
May 23, 2013 12:46 pm

Money talks / its the economy stupid / etc. People vote with their pocketbooks. No doubt the US energy boom has made the Great Recession less worse. Politicians are slimy but are normally also wily.

Tom G(ologist)
May 23, 2013 1:03 pm

To Dave Wendt: Quite right. In our production area, at each of our successive wells we get better yields than we did at the previous wells within the same uni -twe learn to maximize recovery at each locale. We are operating at the cutting edge of technology optimization. The technology has been proven safe, and we are now working to increase the yield per linear foot of well drilled – and the results are impressive.

May 23, 2013 1:26 pm

P Walker says:
May 23, 2013 at 12:09 pm
Dave Wendt
@ 11:41 am
That’s not what my general partners and my royalty checks tell me . Check the comments at the end of your link .
Well I did say “not necessarily”. That zerohedge post does seem to make a devastating case, but I find some rather glaring weaknesses in his analysis. Primarily because he bases most of it on a break-even price for gas production of over $8 from several years ago. More up to date numbers I’ve seen suggest somewhat different numbers
…”This new pipeline infrastructure means that Pennsylvania’s Marcellus shale is now the largest-producing formation in the country, pushing it past the Haynesville formation in Texas, according to a report from IHS (IHS). It’s also made Marcellus more profitable to operate in than Haynesville. According to calculations by Laurent Key, a natural gas analyst at Société Générale (GLE), the average break-even price for Marcellus dry gas (as opposed to wet, which contains ethane and propane) is $3.08, vs. $3.21 in Haynesville.”
It sounds like you definitely have a much better personal knowledge of what is going on in this area than I do, so I would certainly grant a strong possibility that you are correct. But I have been around for a while and although nothing in life is ever 100%(except death and that other thing) one thing that has been very consistent throughout my life is that doomsayers about energy production have almost always been wrong.
If, as this post suggests, The Bamster and his minions are actually going to get out of the way, even a little bit, it can’t help but improve the situation. Although I’ll believe that when I see it. Actually it will probably be quite some time after they really take action on this before I’ll truly be willing to grant any credence to this announcement.

William Abbott
Reply to  Dave Wendt
May 23, 2013 1:44 pm

Oil and gas production are marginal commodity businesses (most of the time). Once you have sunk the cost, it is really, really hard to shut your well off – at that point it doesn’t really matter if you are making money or not, you just about have to pump, unless the well barely marginal (stripper wells, etc). What a low price does is slow down drilling. You saw that last year with Chesapeake shifting drilling resources away from gas to oil when NG briefly to $2 a therm. What these LNG export terminals mean is the price should reflect world demand and stay high enough to keep the producers profitable. You want the oil companies to make money. They won’t be in business if they aren’t.

May 23, 2013 2:03 pm

Here’s another interesting column about drilling efficiency improvements
…”But the big reason is drilling efficiency. When I go to conferences, I tell the crowd—fracking isn’t improving every year. It’s not improving every quarter. It’s improving every month. That shows up in the reduced time it takes to drill a well now, thanks to improvements in horizontal drilling techniques, and in the amount of gas each well is able get out of the formation—thanks to improvements in hydraulic fracturing.”…
“In one of his blog posts last year, industry expert Rusty Braziel of RBN Energy published some statistics from Southwestern Energy, which provided in-depth numbers on its drilling operations in the Fayetteville shale in Arkansas and Oklahoma.
Over the course of five years, the company’s average drilling time per well plunged from 17 days in 2007 to only 8 days in 2011, falling by more than half. In just one year from 2010 to 2011, drilling time dropped more than 27 percent. Over the same five-year period, the later length of wells grew by 82 percent, and initial production more than doubled, rising from 1.65 million cubic feet per day in 2007 to 3.3 million cubic feet per day in 2011.
All the while, the cost per well hovered around the same level, dipping 4 percent from 2007 levels.
So for the same costs, drilling rigs were producing more than twice as many wells, with more than double the initial production. That means the initial production additions per rig grew by 338 percent in half a decade. If the rest of the energy industry saw the same kinds of improvement over the same period, even while cutting rig counts by three-quarters from their 2008 peak, we would expect to see a modest rise in production from simple efficiency.”

Luther Wu
May 23, 2013 2:49 pm

arthur4563 says:
May 23, 2013 at 5:33 am
“It is spelled: F-R-A-C-I-N-G. There is no ‘K’ i the word fracturing. If you want to use our term, please use it correctly.”
It is being used correctly, and the spelling you claim is bogus in our language – a hard “C”
cannot occur when followed by an “i”. If you want a K sound, you must use a K.
Let’s go ask Jean Luc what he thinks.
Come out to the oilpatch and see Tom and Bill’s Excellent Frac Service and Tiny’s Frac Tank Rentals, etc. Ouch, did that rib just fracture from laughing so hard?

P Walker
May 23, 2013 3:04 pm

Dave ,
The price I was referring to is about four bucks per mcf , so eight dollars is way high . Also , I believe that four dollars is the break even price for conventional drilling – coal bed methane is a little less . It is my understanding that hydraulic fracturing is more expensive , although it sounds like it’s coming down . Even so , over production leads to a glut with an attendant drop in price . Hence , production must eventually slow or demand must increase to insure that the boom doesn’t go bust .

D.J. Hawkins
May 23, 2013 3:40 pm

wws says:
May 23, 2013 at 5:07 am
Regarding the new Energy Secretary’s pronouncement: Didn’t the Inquisition tell Galileo that “The Science is not Debatable”???

Actually it was more like “Prove it or shut up”, but the result was much the same.

Roger Knights
May 23, 2013 7:19 pm

@Luther Wu: The argument wasn’t over “frac,” which would normally take a hard C sound, but over “fracking,” because “a hard “C” cannot occur when followed by an “i”.”

Roger Knights
May 23, 2013 7:20 pm

Oops–I meant “… over ‘fracing’ …”because “a hard “C” cannot occur when followed by an “i”.”

Roger Knights
May 23, 2013 9:35 pm

Here’s an article posted today that describes sharply rowing worldwide interest in natural gas for transportation and cites a recent official US report that projects a tremendous growth in LNG for heavy trucks in the US.

Gail Combs
May 24, 2013 7:28 am

The other shoe just dropped!

Remember Chris Horner’s articles??? Gore’s Inconvenient Enron and Lessons from the global warming industry

Enron, joined by BP, invented the global warming industry. I know because I was in the room. This was during my storied three-week or so stint as Director of Federal Government Relations for Enron in the spring of 1997, back when Enron was everyone’s darling in Washington. It proved to be an eye-opening experience that didn’t last much beyond my expressing concern about this agenda of using the state to rob Peter, paying Paul, drawing Paul’s enthusiastic support….
Buy me a beer and I will regale you with tales of reporters from Newsweek and the Washington Post desperately seeking assistance to spin, respectively, Enron as having urged Bush away from the Kyoto agenda as opposed to having crafted it, and Enron’s global warming activism as its one redeeming feature.
The basic truth is that Enron, joined by other “rent-seeking” industries — making one’s fortune from policy favors from buddies in government, the cultivation of whom was a key business strategy — cobbled their business plan around “global warming.” Enron bought, on the cheap of course, the world’s largest windmill company (now GE Wind) and the world’s second-largest solar panel interest (now BP) to join Enron’s natural gas pipeline network, which was the second largest in the world. The former two can only make money under a system of massive mandates and subsidies (and taxes to pay for them); the latter would prosper spectacularly if the war on coal succeeded.
Enron then engaged green groups to scare people toward accepting those policies. That is what is known as a Baptist and bootlegger coalition. I sat in on such meetings. Disgraceful….

Another article: Enron Sought Global Warming Regulation, Not Free Markets
So now that the EPA has shut down 10% or more of the electric generating capacity, the 2015 auction price has sky rocketed. The market-clearing price for new 2015 capacity – almost all natural gas – was $136 per megawatt. That’s eight times higher than the price for 2012, which was just $16 per megawatt… For the northern Ohio territory served by FirstEnergy, the price is a shocking $357 per megawatt….These are the actual prices that electric distributors have agreed to pay for new capacity
The actual plan was to put in place smart meters:

The Department of Energy Report 2009
A smart grid is needed at the distribution level to manage voltage levels, reactive power, potential reverse power flows, and power conditioning, all critical to running grid-connected DG systems, particularly with high penetrations of solar and wind power and PHEVs…. Designing and retrofitting household appliances, such as washers, dryers, and water heaters with technology to communicate and respond to market signals and user preferences via home automation technology will be a significant challenge. Substantial investment will be required….

And the Financiers were jumping for joy:

We see an attractive long-term secular trend for investors to capitalize on over the coming 20–30 years as today’s underinvested and technologically challenged power grid is modernized to a technology-enabled smart grid. In particular, we see an attractive opportunity over the next three to five years to invest in companies that are enabling this transformation of the power grid.

However the EPA and Department of Energy drastically underestimated the effects of the new EPA rulings. Many more plants are closing than anticipated.
To keep the grid stable (Wind and solar DESTABILIZE THE GRID) electric companies were going to use ‘smart meters’ to shut down residential and small business electricity with ‘rolling blackouts’ so Factories can have a constant supply of power.
ERCOT is in Texas where there is a lot of solar and wind power and is already using that type of system because of rolling blackouts.

Assessment of Demand Response and Advanced Metering
On April 17, 2006, ERCOT was forced to use 1,000 MW of involuntary demand response and 1,200 MW of voluntary demand response to successfully prevent a system-wide blackout. Unusually high and unexpected load due to unanticipated hot weather, coupled with 14,500 MW of generation that was unavailable due to planned spring maintenance, resulted in insufficient capacity to meet load. System frequency dropped to 59.73 Hz at one point. Rolling blackouts were required for about two hours, with individual customers curtailed between 10 and 45 minutes at a time. All of the load called upon to respond did so successfully (voluntary and involuntary), though there was a 15 minute delay with one block of involuntary load curtailment.

Demand Response is the code words for Smart Grid. What they neglect to say is the way this is Demand Response works is with Smart Meters This allows residential electricity to be turned off so the system can be balanced. However customers that figured out exactly what Smart Meters do have raised a big stink.

Don’t want smart meter? Power shut off
The rollout of smart electric meters across the country has run into a few snags: one woman doesn’t want one, and ended up in the dark as a result.
You might not think that would be an issue. But it is, because Duke Energy is now beginning to disconnect any homeowner who refuses a new electric meter.
Other electric companies are not pulling the plug…yet…..
Several states, including California, Michigan, Maryland, Nevada, Vermont and Maine have passed laws allowing customers to opt out of smart meters, usually by paying a small monthly fee….

It gets a bit rough for a politician trying to keep the necessary image that you “Represent the interests of the people” while passing laws that not only rip them of but then skewer them and roast them over a fire. Sooner or later people figure it out, and it is the politician that is in line for a introduction to Madame Guillotine not the guys pulling his strings.

May 24, 2013 10:24 am

@Tom G(ologist):
As I don’t want to offend “the industry”, yet find the clear visual of your spelling looks like it would be pronounced “frassing”, given normal English pronunciation rules, I shall start adopting the term:
as a less visually confusing alternative… that doesn’t have a “k” in it either …

May 24, 2013 11:28 am

In oil states like Texas and Oklahoma that have had hydraulic fracturing for years, the rules use the terms frac and hydraulic fracturing; F-R-A-C-I-N-G in the colloquial everyone here uses. So without a k is the legal, not the grammatical, usage. If you don’t believe me, search the rules yourself: http://www.occeweb.com/rules/Web%20Ready%20Ch10%20FY13%2007-01-12%20searchable.pdf

bob alou
May 24, 2013 1:35 pm

arthur4563 says:
May 23, 2013 at 5:33 am
No sir, you are the wrong one. As a petroleum engineer for over 35 years the correct spelling has no k. It has been bastardized by the press and other low-information individuals. It is an industry specific use as many other industries have there own words. There are many more examples of oil field terminology the J Q Public would not understand but that does not make them any less correct.

David A. Evans
May 24, 2013 4:47 pm

FrackingRegs says:
May 23, 2013 at 8:38 am
You talk of de-regulation causing the financial meltdown of 2008, particularly the removal of Glas-Steagal.
I note you don’t mention regulation, to ensure people incapable of repaying their debts would get loans.Wasn’t that some Clinton regulation?

Brian H
May 25, 2013 10:27 pm

Imagine the catastrophic enlightenment that would/will ensue when the Greens twig that they were sicced onto their targets by Enron, after it had prepositioned itself to profit from their unique combo of gullibility and political clout. I bet it’s quietly urging the O-sockpuppet to mandate Smart Gridding everyone next.
I am somehow reminded of a childhood viewing of a flic called (I believe) Mars Invades. Humans were seized and processed, thenceforth operating as remote controlled subversives. The tell-tale was a thick red + mark on the back of the neck, just under the hairline, where the device focussed to access the brain stem. Check your loved ones.

May 27, 2013 12:39 pm

@Brian H – Actually the movie was called “Invaders From Mars” but your point is well taken nonetheless.

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