WASHINGTON DC — Last week President Obama announced his rejection of the Keystone XL pipeline permit, an act that IER President Tom Pyle called “unconscionable” given the economic consequences. Within the next 24 hours, President Obama’s decision will result in $5 billion eventually going overseas to purchase oil from unstable petroleum regimes, and the amount grows by $70 million per day.

“Since his original delay, President Obama has now ensured that American consumers to spend nearly $5 billion on overseas oil when we could be developing and utilizing our own vast resources in North America. With more than 1.7 trillion barrels of recoverable oil under our soil, we have enough oil to fuel our present needs for the next 250 years,” IER President Tom Pyle noted.

In its analysis, the Institute for Energy Research has scored the economic value of the President’s decision to kill Keystone XL. Consider the following:

• The Obama administration approved $6 billion last year in voluntary dues to the United Nations.
• The Obama administration continues to fund the International Clean Technology Fund, which will cost U.S. taxpayers upwards of $3.3 billion dollars to help China with their own energy research and development.
• The Obama administration has requested $1.4 billion to fund its global climate change agenda at the State Department, USAID, and the Treasury.
• The Obama administration funded the Office of Energy Efficiency and Renewable Energy with $9.1 billion in 2010. These funds went to provide for various solar power projects, to deploy wind and other “green” technologies, and to facilitate research on the conversion of plants into fuel.
• The Obama administration sought and received $3 billion dollars for ‘Cash for Clunkers,’ a one-month program that cost U.S. taxpayers approximately $20,000 per car.
• The Department of Interior is projected to spend more than $2.3 billion over the next ten years to purchase additional federal lands, despite the fact the federal government already owns approximately 650 million acres. Most of this land is blocked from energy development due to federal regulations and governmental indifference.

Last month, IER released a Keystone XL Pipeline Tracker that provides real time estimates of the dollars that U.S. consumers are forced to send overseas because of the President’s decision:

WASHINGTON D.C. — The Institute for Energy Research announced today its full support for immediate development of the Keystone XL pipeline, and has placed on the organization’s website a ticker representing the money that President Obama’s delay will send overseas so long as Americans cannot access Canadian oil through the proposed pipeline.

“At this point, the greatest obstacle to American jobs and energy security is President Barack Obama.  With oil at $100 a barrel — and the Keystone XL’s ability to deliver around 700,000 barrels a day from Canada — the President’s delay and indecision means that Americans will be sending approximately $70 million overseas every day that the pipeline isn’t active,” according to IER Senior Vice President for Policy, Dan Kish.

“IER believes the American people have a right to know how much money the Obama administration would rather spread around the world’s unstable oil regimes than spend with our closest trade partner, Canada.  The American economy runs on oil.  If we don’t buy it from Canada — or produce it right here at home — we are forced to import it from overseas and forego tens of thousands of American jobs that the pipeline will support.”

IER began calculating the dollars that will be sent overseas beginning two years from the day of President Obama’s first announced delay — November 10, 2011.  TransCanada has projected that pipeline construction would take two years from approval.  IER’s pipeline ticker will demonstrate exactly what the cost of the President’s delay will be, and precisely how much money American consumers will spend unnecessarily on overseas oil without Keystone XL.

To access the Keystone XL Cost widget for digital reproduction, click here.

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The President will undoubtedly receive a warm welcome at the company’s headquarters:  Johnson Controls received $316,537,977 from American taxpayers through President Obama’s stimulus plan.

Such preferential treatment for Johnson Controls is in line with President Obama’s view of how government should function:  subsidize politically-connected companies with taxpayer cash and establish regulations that force Americans to use that company’s products.

The enormous increase in subsidies and regulations under the Obama Administration is yet another step away from consumer-driven markets towards a government-controlled economy.

In response to the President’s trip, Daniel Kish, senior vice president for policy at the Institute for Energy Research, issued the following response:

“Instead of looking at Holland, Michigan’s green energy subsidies, the President should be learning from Holland – the Netherlands – where their government just became the first in the European Union to reject renewable energy mandates and cut subsidies for green power.  In that Holland, it was decided that neither the government nor the consumers could afford to pay the much higher costs of so-called green energy.

“As much as all of us would love for these technologies to be affordable and attractive to consumers, they are not panning out, here or abroad.  The President’s obsession with the fiction of green energy continues to play a cruel joke on working Americans by continuing to spend money the United States doesn’t have on products Americans won’t buy.

“President Obama likes to tout the jobs artificially created by subsidizing projects with borrowed money.  What he doesn’t seem to realize is that these jobs will exist only as long as money from Washington funds them.  Most Americans know that Washington money is running out, even if the President doesn’t.”

Obama Administration Taps Strategic Reserve to Lower Oil Prices Raise Approval Ratings

WASHINGTON – This morning, the Obama Administration announced that they would release 30 million barrels of oil from the Strategic Petroleum Reserve.

Less than a year ago, the Obama Administration was insisting that its moratorium on drilling in the Gulf of Mexico would do no harm to our nation’s economy because we could just buy more oil from OPEC. Now, instead of allowing more production in the Gulf of Mexico and offshore Alaska, the President is tapping our strategic reserve in the salt domes of Texas and Louisiana, which will only have to be refilled later at potentially higher prices.

Tapping the SPR will do nothing to bring down oil prices in the long term, but rather distort markets even further without bringing any significant new energy supplies to market. If allowed to drill in Alaska, we could produce an extra one million barrels a day for decades, rather than one month, as the president’s plan calls for.

America is home to over 150 billion barrels of conventional oil. By developing these domestic resources, tens of thousands of Americans could be employed with well-paying jobs and energy prices would fall immediately, just as they did when President Bush ended the executive moratorium.

In response, Thomas Pyle, president of the Institute for Energy Research, issued the following statement:

“President Obama’s energy plan is not just misguided – it is a national catastrophe. America is home to the largest fossil fuel resource base in the world. Instead of allowing Americans to go to work developing theses energy resources, President Obama continues to keep them unemployed to satisfy his anti-energy allies.

“There is at least one bright spot with this news from the White House: it seems that President Obama finally realizes that increased supply will bring down prices. But if President Obama really wants to see long-term energy prices decline, he must allow American energy workers to develop our billions of barrels of oil.

“The Strategic Petroleum Reserve is not an ATM for the President to withdraw from when he needs a boost in his bad approval ratings. The 30 million barrels of oil from the SPR are insignificant compared to America’s massive resource base. The President should save reserves in the SPR for times of war and legitimate crisis, not Washington-created disasters.”

The Obama Administration insisted that the rapid decline of oil production due to their anti-drilling policies would not affect the price of oil because we could just rely more on the dictators at OPEC to give us oil:

Unfortunately, OPEC’s meeting today shows why President Obama’s policies are so misguided.  The cartel’s meeting apparently turned into a fiasco, not surprising to hear about a gathering of some of the world’s most hostile regimes.  Despite growing global demand, the group decided that they will not raise oil production for the remainder of the year.

In response, Thomas Pyle, president of the Institute for Energy Research, issued the following response:

“When will President Obama finally admit that he is directly causing a national, Washington-created disaster?  Less than one year ago, the Obama Administration was telling the American people that their anti-drilling policies were no big deal – we can just get more oil from OPEC.  Until this Administration reverses its senseless energy agenda, which is deliberately leading to higher energy prices, we can expect more of the same in the future from OPEC.

“America is home to over 150 billion barrels of oil.  There is only one thing preventing the American people from accessing these resources: the Obama Administration.  Hopefully today will be a reality check for those in Washington who believe that American energy production can be replaced with a reliance on state-run energy companies in unstable region of the world.”

Ms. Merkel, typically viewed as a champion of fiscal austerity within the European Union, seems misguided in her quest to force German citizens to pay more for their energy by replacing reliable nuclear power plants with expensive, intermittent, unreliable technologies such as solar and wind.

A 2009 study commissioned by the Institute for Energy Research shows that Germany’s doubling-down on renewable energy subsidies have cost citizens there huge sums of money while providing very little economic or environmental benefit:

-Solar PV, Germany’s most heavily subsidized renewable energy, accounted for as little as 0.6% of Germany’s total electricity generation in 2008 at a net cost of about $12.4 billion US.

-Government aid for wind power is now three times the cost of conventional electricity.

-Government support for solar energy between 2000 and 2010 is estimated to have a total net cost of $73.2 billion US, and the cost of supporting wind power during those years is estimated to total $28.1 billion US.

In response to Merkel’s visit to the U.S., Thomas Pyle, president of the Institute for Energy Research, issued the following statement:

“Chancellor Merkel is ignoring the real world implication of her pie-in-the-sky policies: her citizens will be forced to foot the bill.  Germany has spent over $100 billion in taxpayer money over the past decade subsidizing the wind and solar industries, but they still produce less than seven percent of the nation’s energy.

“President Obama has shown a penchant for radical energy policies in the past.  After Stephen Chu publicly stated that ‘somehow we have to figure out how to boost the price of gasoline to the levels in Europe,’ Obama appointed him as Secretary of Energy.  We can only hope that President Obama abandons his quest to be more like Germany and other European countries with respect to energy policy.”

In his written testimony, Mr. Bromwich claims that shallow water drilling permits “have averaged 6 per month since October 2010, compared to an average of 8 per month in 2009.”  He is correct.  However, he forgets to mention that shallow water permits granted in 2008 averaged 16.8 per month.  Mr. Bromwich’s statement highlights the drastic decrease in shallow water permitting since President Obama came into office.  Meanwhile, shallow water energy producers have spilled only 15 barrels of oil in the past 15 years of production

But the administration’s shallow water permitting record is fantastic when compared to deepwater permits.  BOEMRE has only approved two permits to drill a new well in waters deeper than 500 feet since the end of the moratorium.

“The Energy Freeze that the Obama Administration is imposing on the Gulf coast is destroying businesses and causing families to lose their livelihood,” said Thomas Pyle, president of the Institute for Energy Research.  “And it doesn’t stop there:  the entire nation is paying higher gas prices, in part because the Obama Administration’s moratorium and permitorium in the Gulf of Mexico – where Americans get 1/3 of their domestic oil. Because of these policies oil production was reduced by 110,000 barrels per day in 2010 and 250,000 barrels per day in 2011 from Energy Information Administration expectations.”

“While the moratorium on drilling is over, the permitorium continues to keep Americans unemployed and keep our nation more reliant on state-owned energy companies in regions of the world that are inimical to American values.”

Mr. Cory Kief, the president of an oil rig transportation group that employs about 100 people, had the best summary of the Obama Administration’s actions in his testimony today:  “Mr. Bromwich claims to be offended by the term ‘permitorium’, but [he] doesn’t understand that MILLIONS of people are offended by the actions, or LACK of actions, by this administration… This government is so broken, and is beginning to virally infect the American people who deserve better.”

Over the past year, scientists, engineers, and a host of other specialists have worked diligently to make sure that a tragedy like the Deepwater Horizon accident never happens again.  A consortium of companies created the Marine Well Containment Company which designed a containment system to prevent liquids from escaping into the water in the case of another blowout.  Also, the Helix Energy Solutions Group developed a floating oil production facility, ready to deploy in the Gulf.  Both of these systems are capable of containing a blowout that is deeper and larger than the Macondo well.

These technological developments should be seen as a legacy of what we have learned from the Deepwater Horizon.  Unfortunately, the Obama Administration is instead making a domestic energy freeze its legacy of the Gulf oil spill. The administration decided to freeze most drilling in the Gulf while dismissing respected scientists and industry experts whose safety recommendations would have allowed for more robust production.  To this day, the Obama Administration continues to kill jobs in the Gulf and around the country by withholding the necessary permits to responsibly explore for domestic energy. 

IER, along with the Heritage Foundation, recently traveled to the Gulf coast to hear first-hand how the moratorium and ‘permitorium’ are affecting people.  Their stories show the economic destruction that the Obama Administration is imposing on these everyday Americans.  CLICK HERE to watch their stories