WASHINGTON – The American Exploration and Production Council submitted a letter for the record for the US Senate Energy and Natural Resources Hearing today examining the causes, outlook, and implications of domestic and international energy price trends.
“Congress can help alleviate Americans’ rising energy prices by championing policies that support domestic production and by opposing policies like the new natural gas tax that would increase Americans’ energy costs on top of soaring inflation costs,” said AXPC CEO Anne Bradbury.
In the letter, AXPC CEO Anne Bradbury explained that Congress can help alleviate Americans’ rising energy prices by championing policies that support domestic production and how AXPC hopes the hearing will highlight how flawed policies like the proposed methane fee and the numerous punitive federal leasing policies in the reconciliation bill will cause Americans’ energy prices to rise (among other negative consequences). In summary:
New Natural Gas Tax:
- Higher energy costs act as a regressive tax on American families and businesses. The most vulnerable Americans will suffer the largest burden of this policy. One-third of Americans already have trouble paying their energy bills, adding a new tax on natural gas would only make those burdens larger. An analysis by the American Gas Association (AGA) shows that this proposed tax would increase natural gas bills at least 12 percent – maybe even up to 34 percent. This could be on top of the double-digit increase predicted by EIA.
- This punitive methane fee amounts to a production tax on America’s oil and natural gas industry that would hurt supply of natural gas and could cost the American people over $9 billion and about 90,000 jobs across the country.
- A new natural gas tax will add additional increased costs to Americans’ energy bills, layered on top of inflation and the $13 billion in compliance costs from EPA’s new methane regulations.
- Rather than incentivizing investments in emerging technologies to accelerate emissions reductions, the proposed methane tax would have the reverse effect of hampering investment in breakthrough technologies.
- The legislation is constructed in a way that penalizes the industry. Because the legislation relies on flawed, biased formulas, many operators who operate nationally below a 0.2 percent methane intensity will pay this punitive tax.
Production on Federal Lands
- Energy produced on federal lands and waters is critical to America’s energy security, accounting for 20 percent of all oil and natural gas produced here. The myriad of punitive federal leasing policies in the reconciliation bill will lead to less production on federal lands (less supply), which will hurt our energy security and be yet another upward pressure on Americans’ energy prices.
- The federal lands provisions in reconciliation negatively impact existing leases and dramatically increases the cost, risk and business uncertainty associated with developing federal minerals.
- By increasing the cost and risk associated with developing on federal land, reconciliation will result in significantly less development on federal lands – which will result in significantly less revenue for local and state economies, especially in the west, which is highly dependent upon responsible federal development.
The full letter can be found here.
About the American Exploration and Production Council:
AXPC is a national trade association representing the largest independent oil and natural gas exploration and production companies in the United States. We lead the world in the cleanest and safest onshore production of oil and gas, while supporting millions of Americans in high-paying jobs and investing a wealth of resources in our communities. Learn more at https://axpc.org/