By Mike Giles
WILMINGTON — Everyone can agree that becoming energy independent is critical for the United States and the need for well-paying jobs is dire, especially in North Carolina. A recent decision from the Obama administration on oil and gas exploration off the East Coast was a wake-up call for everyone who loves the coast. The latest developments around offshore energy prompted the need for a discussion and the first Coastal Energy Summit in Wilmington last week.
The first guest speaker to address the summit was Jack Gerard, president of the American Petroleum Institute. Gerard started the dialogue by sharing big figures from studies on oil and gas production and its potential that made the industry sound very attractive. The oil and gas industry currently supports $1.2 trillion to the country’s gross domestic product and contributes $85 million to the Federal treasury every day.
In North Carolina, according to the most recent vendor survey, the upstream sector of the oil and gas industry contributes $12 billion to the state’s economy and supports 146,000 jobs. A report from Woods Mackenzie forecasts that oil and gas production has the potential to increase employment in North Carolina from 4,800 in 2010 to 49,000 by 2025 with the right policies in place.
With numbers like those, how could North Carolina not take advantage of the potential resources off the coast? But at stake is a coastal environment that is second to none and which natural resources brings thousands of jobs and billions of dollars each year into our state. The potential for offshore energy must be balanced and weighed against the very real danger this poses for our coastal resources and the people who depend on them. That no one is discussing the need for an onshore energy policy to compliment any offshore project is troubling at best. The first steps moving forward on offshore energy production are to find out what resources exist off the coast of North Carolina and at what cost can they be recovered and utilized. The data currently available is dated and the federal government plans to start seismic testing next year to identify potential energy sources.
To emphasize the need for seismic testing Gerard noted, “Just as none of us would think about using a 30-year old cell phone or computers to help run our businesses, using data generated three decades ago to help shape today’s energy policy is equally absurd.”
Let’s not forget North Carolina is the state known for effectively “outlawing” planning for sea-level rise by passing legislation in 2012 that restricts all sea-level predictions used to guide state policies for the next four years to those based on “historical data.”
Seismic testing was a major topic of the day’s conversation. Jeff Vorberger of the National Ocean Industries Association undermined the potentially harmful effects by saying the process is basically an “ultrasound of the earth,” claiming there is no record of harm to marine life.
Answers to an audience question about offshore energy exploration on the West Coast, which has had no new production due to unpopularity, revealed that industries look for signals for community receptiveness when siting for energy development. The 4.8 billion gallons of oil predicted to lie off the coast of North Carolina is merely a fraction of the 134.51 billion gallons consumed by the United States in 2013, and seems hardly worth compromising the health and quality of our coast for such a limited resource.
Panelists leading the Coastal Energy Exploration discussion included Brian O’Hara of the Southeastern Coastal Wind Coalition; Craig Poff of Iberdrola Renewables; Andy Radford of the American Petroleum Institute; Lisa Schiavinato of the N.C. Coastal Resources Law, Planning and Policy Center at N.C. State University; and Vorberger. They talked about the vast potential for wind energy generation onshore and offshore in North Carolina and the large gap in wind energy generation in the southeastern part of the United States.
The supply chain for wind energy production in the Southeast is long, and coastal communities are poised to attract manufacturing industries for turbine parts production, many of which are too large to transport by land and will rely on the ports for distribution. The state is ready on the land based side, but North Carolina still faces several obstacles before offshore wind energy production becomes a reality.
Poff mentioned that the recent passing of House Bill 484, “The Permitting of Wind Energy Facilities Law,” sent a signal to the wind industry to “slow down, reconsider if you want to do business in North Carolina.”
Despite continuing advances in technology and projects in Europe with 20 years of operating history to look to for guidance, offshore wind energy development will still be challenged with creating good policy to balance conflicts of use and determining how infrastructure will play into development.
A Q&A session with Gov. Pat McCrory concluded the event, drawing nearly 100 protesters from film, education and environmental groups picketing outside. McCrory, vice chair of the Outer Continental Shelf Governors Coalition, is obviously ready to move forward with oil and gas exploration and production off North Carolina’s coast but recognizes that every energy source has its positives and negatives and energy sources all have short- and long-term ramifications. The two major challenges he identified to developing the best energy policy for the state is the lack of public education about energy and the how to execute the strategy — how to pay for, plan for, govern and oversee it.
An outburst from an audience member who was escorted from the room prompted McCrory to address environmental concerns associated with offshore energy. McCrory expressed a need for an “intellectual conversation” from representatives on both sides of the energy issues and stressed that we must be “clearly upfront” on the costs and benefits of all sources of energy production. When questioned about the state’s role in funding energy research and who is involved, McCrory says, “…with all due respect, the environmental groups, and frankly some of the industries, instead of spending money on political ads, I’d rather have the money spent on research and actual environmental clean-up.”
The first Coastal Energy Summit did start the conversation about offshore energy in North Carolina, but ultimately failed to go very far past what we already know about prospective energy sources for the state. It’s rather disappointing that there was no mention of conservation policy and little emphasis on the well-paying jobs that do not harm the environment that our Governor and elected officials have chased away with the change in incentives and an understandable all-out effort for fossil fuel research and development given their political support.