Things to be Thankful for this Holiday: Friends, Family and Savings from Fracking
There’s much to be thankful for this time of year: friends, family, good food and, of course, football. Just as importantly, we should all be thankful for improved U.S. energy security. Thanks to advancements in American energy production such as hydraulic fracturing and horizontal drilling, the United States is now awash with oil and natural gas, helping to bring families together, keep them warm and put money back in their pockets.
According to the American Automobile Association (AAA), this Thanksgiving week will see the largest number of travelers since 2004. Projecting that roughly 51 million Americans will trek at least 50 miles from home between Wednesday and Sunday – 89 percent of which will be driving – low prices at the pump will have an enormous impact this year. While AAA expects the average gasoline price to be slightly higher than 2016 at $2.54 per gallon, it’s still significantly less than the $2.79 average seen in 2014. Some back of the envelope math shows that with an average fuel efficiency of 25.2 miles per gallon, U.S. drivers will save over $22.5 million on gasoline this week alone compared to 2014.
But it’s not just at the pump where Americans will see savings this Thanksgiving. A report from the Business Council for Sustainable Energy and Bloomberg New Energy finds American consumers are now spending less of their incomes on energy than ever before in the modern era. Covering across-the-board benefits of the rise in natural gas use across the United States, the report finds that shale natural gas production has increased nearly 80 percent since 2011, while overall U.S. natural gas production jumped by 12 percent. Such a massive increase in natural gas supply, along with the addition of 39 gigawatts of natural gas fired generation capacity over the past five years, has helped lower average electricity prices by three percent nationally. Some states have experienced even larger decreases, with retail electricity prices dropping over 10 percent in Texas, New York and Florida during this same time.
In addition to lower electricity prices, the meteoric rise in American natural gas production is helping Americans save when heating their homes or cooking their turkeys. For example, a new study from University of Pennsylvania found that with Pennsylvania’s 2,800 percent increase in natural gas production between 2007 and 2016, gas bills in the state dropped 40 percent over that same period, while the price that utilities are charging customers declined by 75 percent. Nationwide, the report finds, average natural gas prices for the electric power sector declined by 65 percent, while residential gas customers saw a 34 percent decrease in their gas bills. These findings are in line with a A recent Harvard Business School analysis that found, because of shale development, American households have realized low-cost natural gas savings of $800 per household.
As far as overall household energy costs, a 2016 EIA analysis shows that since 2008, roughly the start of the energy renaissance, average annual energy costs per household in the United States have dropped by more than 14 percent.
Businesses are also feeling huge benefits from the significant growth in U.S. natural gas development. According to an American Gas Association report published at the beginning of this year, affordable natural gas from shale development has dropped commercial sector natural gas bills by nearly 50 percent. This reduction translates to a savings of roughly $76 billion since 2009.
These energy savings are currently being enjoyed across the United States despite record oil and natural exports, standing in direct contradiction to what opponents have claimed about exports increasing domestic prices. Total U.S. natural gas exports have more than doubled since 2010, growing by roughly 1.2 trillion cubic feet from 2010 to 2016, with the United States becoming a net exporter of natural gas for the first time in almost six decades. Further, crude oil and petroleum product export reached record levels in the first half of 2017, as crude oil exports grew by more than 300,000 barrels per day from the first half of 2016 to reach 0.9 million barrels per day in the first six months of 2017.
This year while watching the game on TV in your warm house, driving to your in-laws’ house, or pulling that delicious turkey out of your oven, give a little thanks to fracking for not only making these things possible, but saving you money while doing them.
Have a safe and happy Thanksgiving weekend!