New study: Development of Shale has Saved Consumers $250 Billion Since ’09
Tuesday, May 29th, 2012 | 4 Comments
Whether we’re talking about the creation of 600,000 new jobs, the lowering of carbon emissions, the lessening of our dependence on foreign energy, or the nearly $250 billion in savings for natural gas customers—the development of natural gas from shale is reinvigorating our nation, and giving a boost to our economy while it’s at it.
And with development occurring right now in more than two dozen U.S. states — from Ohio’s Utica shale to south Texas’s Eagle Ford play — it’s no surprise that the benefits of responsible production are being felt across the nation. But according to a new report by the American Gas Association (AGA), the impact of natural gas development on the pocketbooks of American consumers may be a lot more remarkable than even we had previously thought.
As AGA highlights in its new report, states actively developing their own natural gas resources have seen record-breaking production while creating thousands of jobs and economic benefits in their wake. And as a result of this increased production, America’s economy is back on its feet, creating savings, revenues, and jobs along the assembly line. According to AGA, production has led to:
- Savings of almost $250 billion for end-use natural gas customers over the past three years,
- $175 in savings for an average residential customer in 2010,
- $1,100 to the average commercial customer in 2010,
- And the creation of 334,000 jobs in industries reliant on natural gas over the past two years.
The tremendous efforts of producers, combined with the supply-demand dynamics of the market place, have driven down the average price of natural gas. And since natural gas utilities are not able to profit from the price of natural gas, any decrease in price of goes directly into the pocketbook of the consumers. Good news for the general public (which relies on natural gas for 25 percent of its electricity needs), the environment (as natural gas is the cleanest burning fossil fuel), and for American manufacturing (QED).
As AGA points out: “Not only do these savings benefit the gas customers, but there is a ripple effect on the economy when consumers spend some of these savings.” While savings increase at home, Americas manufacturing base has rebounded, capitalizing on an inexpensive, abundant, and clean-burning resources, while putting people back to work and keeping industries in the U.S.
According to the report:
“Lower natural gas prices have also helped create jobs during one of the worst recessions on record. Job creation directly tied to energy extraction and delivery accounted for about 150,000 new jobs in 2011; and expansion of natural gas-dependent industries could lead to an additional one million manufacturing jobs by 2025.”
“Jobs that provide goods and services to the shale industry totaled 194,000 in 2011 with expectations to grow to 283,000 by 2015. Jobs induced by the multiplier effect numbered 260,000 and may reach 870,000 by 2015.”
The combination of hydraulic fracturing and horizontal drilling has unlocked immense natural gas reserves, and a result of this technological breakthrough, natural gas producers are able to safely and responsibly provide an abundant supply of energy for America’s natural gas users – from families to schools, steel plants to CNG powered trucks – while generating substantial benefits for consumers and job-seekers alike.
With shale development placing prosperity on our nation’s doorstep once more, communities across the country – from the Marcellus to the Eagle Ford – are finding new opportunities to benefit from natural gas production. As studies from IHS CERA, Pricewaterhouse Coopers, Penn State, MIT, IEA and others have highlighted before, the nation sits upon a “golden” age of natural gas, with countless opportunities surrounding development at every turn.