A House Energy and Commerce Committee hearing Thursday featured a helping of raw presidential politics as lawmakers battled over President Obama’s and Mitt Romney’s energy blueprints.
The presence of a top Romney energy adviser, the billionaire oil executive Harold Hamm, intensified the election-season thrust-and-parry even though Hamm insisted he wasn’t there representing the Romney campaign.
The topic of the hearing — achieving North American energy independence by 2020 — also happens to be the goal of Romney’s energy plan, which focuses heavily on expanding areas available for drilling and paring back regulations.
“It is ... a goal that can’t be achieved under the current policies of President Obama,” said Rep. Steve Scalise (R-La.).
Republicans also say the White House is imposing too many regulations on energy producers.
But Democrats returned fire, citing U.S. oil-and-gas production growth under President Obama, and casting the Romney plan as a gift for oil companies, noting it leaves intact billions of dollars in industry tax breaks.
“It is a backwards-looking plan that resurrects the Bush-Cheney policies,” said Rep. Henry Waxman (Calif.), the committee’s top Democrat.
He noted that oil import reliance has been falling under Obama and that new vehicle mileage standards will lead to more fuel savings. Obama's energy plan calls for expanded oil-and-gas development
Rep. Edward Markey (D-Mass.) panned Romney’s plan as an “oil above all” strategy.
He said Romney’s call for killing wind industry tax credits is “amazing” and a double standard given GOP support for oil industry tax incentives.
“Republicans are so tied to the oil industry that they cannot give up those tax breaks,” Markey said.
Hamm, the chairman of Romney’s energy policy advisory team, declined to say whether he agrees with the GOP White House nominee that the wind energy production tax credit should be allowed to lapse at the end of the year.
“I don’t know. My business is not wind,” he said in an exchange with Markey.
But Hamm offered a defense of tax incentives available to oil companies, such as the ability to write off certain drilling costs. Obama is campaigning on calls to repeal industry tax breaks.
“The repeal of these tax provisions would result in as much as a 40 percent decrease in drilling activity and stop this American energy renaissance,” Hamm said.
Hamm said the increase in U.S. oil-and-gas production has nothing to do with Obama, and is occurring “in spite” of federal policies.
“It has been brought on by the private sector entirely,” said Hamm, whose company, Continental Resources, is a major player in the booming Bakken oil formation that underlies North Dakota and Montana.
While overall U.S. oil-and-gas U.S. production is booming, Republicans have seized on a recent dip in total production from federally controlled lands and waters to allege that White House energy policies are too restrictive.
But administration officials say they are making ample areas available for drilling, and note that changes in oil-and-gas production patterns stem in part from the industry movement toward energy-rich shale formations.
Gulf of Mexico oil production was also affected by the temporary drilling freeze imposed after the 2010 BP spill, a disaster that led to tougher drilling safety rules and has slowed down permitting.
John Freeman, a top analyst with Raymond James & Associates, predicted at the hearing that the United States would become the world’s largest oil producer before the end of the decade.
He noted that net petroleum imports have already fallen from a high of 65 percent in 2005 to 52 percent in 2011, a reduction he said is caused in equal measure by rising production and declining consumption.
Between 2008 and 2011, the United States added more oil to global supplies than any other nation, said Freeman, the company’s managing director for equity research. He noted this is “especially impressive” given the reduced 2010 and 2011 output from the Gulf of Mexico.
Raymond James’s analysis predicts that over 80 percent of the country’s continued oil production growth through 2015 will come from the Bakken formation and two Texas formations: the Eagle Ford Shale and the Permian Basin.
The hearing also featured an argument between Whitfield and Markey following the Massachusetts Democrat's grilling of Hamm.
Whitfield took issue with Markey’s attacks against Romney’s position on the wind tax credit, which is slated to expire at the end of this year — before Romney would take office, should he win the White House.
“You could have extended longer,” Whitfield said, arguing that Democrats had the chance to provide a long-term extension when they controlled both chambers earlier in the Obama administration. “Romney has nothing to do with this.”
Whitfield also took aim at what he and other Republicans allege is a White House “war on coal.” Republicans are seeking to scuttle Environmental Protection Agency rules that impose new air pollution requirements on coal-fired power plants.
“You are not interested in coal jobs, are you?” Whitfield said.
Markey returned fire by noting that large natural gas supplies and low prices — not regulations — are what’s hurting coal.
“Natural gas is killing coal in the free market,” Markey said.