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Virginia has been the center of quite a few controversies in the U.S. energy industry, stemming from the cancelled Atlantic Coast Pipeline and the oft-delayed Mountain Valley Pipeline. But quiet as it’s kept, for the past five or six years Virginia has been at the epicenter of the U.S. natural gas industry.
Despite being home to the longest landfill natural gas pipeline in North America, producers in Virginia are still facing what Brett Vassey, CEO of Virginia Manufacturers Association, feels is a major problem: the Virginia Clean Economy Act, which pledges that the state must achieve absolutely zero carbon emissions by 2050.
“Virginia has eliminated our opportunity by 2050 for any fossil fuel fired energy generation,” Vassey told the audience at Hart Energy’s America’s Natural Gas Conference on Sept. 27. “By 2050, by statute, we are supposed to have eliminated and be at not net zero, but zero carbon.”
Net zero carbon emissions, while a popular goal in the energy industry, serves as an economic detriment to many, said Vassey.
Outside of energy, businesses in Virginia thrive. According to the Virginia Manufacturers Assocation’s manufacturing competitiveness index, which measures Virginia’s competitive business environment against 49 other states, Virginia ranked seventh in overall competitiveness. But even with the state ranking high in competitiveness, Virginia placed 19th in the average price of industrial natural gas and 23rd in the average price of electricity for industrial consumers. The rankings for the price of natural gas and electricity scare off energy intensive businesses from working in the state, said Vassey.
“We're out of the business of being competitive in heavily energy intensive businesses because of just those two factors. We want to reverse that because we are a preferred location for reshoring,” Vassey told the crowd. “If we are able to maintain natural gas as a fuel for electricity, we will be more competitive. So getting energy policy right is the core of manufacturing competitiveness for us.”
But much to Vassey’s chagrin, the state of Virginia doesn’t seem too worried about competitiveness in the energy industry.
“Let's be clear, everywhere we work, it's not a matter of coexistence, it's a matter of eliminating [natural gas] from market,” he said.
In an effort to change the stigma around natural gas production, the Virginia Manufacturing Association rolled out campaigns such as the ‘Don’t Touch My Gas’ initiative. And while those campaigns made some traction, Vassey contends that these campaigns won’t “change the hearts and minds of people.”
He feels that non-governmental organizations have been able to influence the minds of the media and young people coming out of college to paint natural gas in a negative light. Simply telling voters the economic benefits of natural gas production no longer brings results. To turn public opinion towards the side of natural gas production, Vassey implores the industry to focus on the impact energy produced by natural gas has on day-to-day life.
“From a national security point of view, having access to plentiful, reliable, affordable fuel feedstock and the electricity that is developed from that, we see that as a national security issue. … From the point of view of quality of life, this is actually an existential threat to the nation,” Vassey said.
Although odds are stacked against manufacturers and other producers of natural gas, Vassey does see a real and achievable solution to all that ails him and other proponents of natural gas.
In Vassey’s eyes, the key to getting energy policy right is “the grassroots connection between the entire supply chain. From the folks that are doing the survey, through production, midstream, all the way to the plant for who are using these fuels and the employees that benefit from the products that are on the street. We have to connect all of that.”
Furthermore, he also calls for action on the state level, hoping for the establishment of governor’s coalitions that would help the power to streamline the permitting process for energy infrastructure, furthering the natural gas cause. The coalition would also view natural gas as a feedstock for energy and protect it in perpetuity.
“Governors can influence outcomes in ways that others can't... We've been putting some effort into [building a coalition] in the Consumer Energy Alliance and in Virginia Manufacturers,” Vassey said. “[The coalition] will protect these fuels and feed stocks in perpetuity under national security and competitive concern.”
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