John Kerry Talks Energy

The leading Democratic presidential contender, U.S. Sen. John Kerry, discusses why natural gas plays a central role in his energy plan.

"Within a decade, America will no longer have to rely on Middle East oil." So promises U.S. Sen. John Kerry's proposed energy plan, released to the nation earlier this year while Kerry was campaigning for the Democratic presidential nomination. Now that his nomination is all but final, Massachusetts' senator is going on record in an exclusive interview with American Gas, talking about the energy policies he hopes to put in place and why natural gas is so vital to the nation's energy future.

"Reducing our dependence on oil and building a future of clean and abundant energy are urgent national priorities," Kerry states on his campaign's website. "Americans spend more than $20 billion each year on oil from the Persian Gulf—often from nations that are unstable and hostile to our interests and our values."

Kerry says that by ending this dependence, the United States' security and economy both will be boosted. His plan reportedly would reduce oil dependence by 2 million barrels of oil a day and create 500,000 new jobs over the next decade.

Kerry first served his nation as a Swift Boat officer in the Navy, working on a gunboat in the Mekong Delta in Vietnam. He received a Silver Star, Bronze Star with Combat V and three awards of the Purple Heart for his service. More than a decade later, he was elected lieutenant governor of Massachusetts, and two years later, in 1984, he was elected a U.S. senator. He is now serving his fourth term in the Senate.

American Gas: Because of its environmental attributes, efficiency of use and large, domestic resource base, natural gas is generally considered the ideal primary fuel. Do you support its increased use, and if so, what steps would a Kerry administration take to increase the use of natural gas?

Sen. Kerry: For the reasons you have cited—the positive air emissions profile and domestic availability—natural gas is an important component of my energy proposal. Until recently, it has been available in sufficient quantities at generally reasonable cost. The cost of natural gas has risen recently, and its high price places an undue burden on the households that rely on it for heat, the sectors of the economy that rely on it as a feedstock or fuel, and the economy as a whole. I will support measures to increase efficiency, improve infrastructure and encourage balanced development so that natural gas can maintain and expand its clean and cost-effective role in the American energy economy.

American Gas: Today, in every market—whether it's homeowners, businesses, industries, even electricity generation—natural gas is the preferred fuel. Yet, as we have seen recently, the growth in natural gas demand is not being matched by available supply, which has put upward pressure on natural gas prices. What would you do to increase domestic natural gas supply and relieve this pressure on prices?

Sen. Kerry: As outlined in my energy plan, I would take a number of steps to ensure that this important fuel is available in sufficient quantities at a reasonable cost. First, I would enter into a new North American Energy Partnership with our neighbors to the north in Canada and to the south in Mexico to expand the supply of natural gas. Second, I would move as quickly as possible to construct a pipeline to bring the 35 trillion cubic feet of known natural gas reserves on the North Slope of Alaska to the lower 48 states. Third, I would support enhancement of the domestic natural gas pipeline infrastructure to provide sufficient transportation networks for this fuel. Fourth, I would support development of advanced technologies that can allow us to use natural gas more efficiently. Fifth, I would support environmentally responsible exploration in the lower 48 and in already-approved areas in the western Gulf of Mexico, including deep water. And finally I would ensure appropriate and adequate enforcement of the market so that it operates in a lawful, transparent and fair manner.

American Gas: Your platform calls for a "Conservation Covenant," in which you would "tread lightly" on public lands. The natural gas industry says it already does tread lightly on public lands. It points to its exemplary record of drilling without harming the environment, and it notes that new technological breakthroughs in drilling equipment—3-D and 4-D seismic image drilling, for example—allow producers to drill fewer wells in smaller places, with much greater precision. Given that, would your covenant allow for drilling in new areas in the lower 48 states? Would you also consider allowing drilling on the Outer Continental Shelf under certain conditions, and if so, what would they be?

Sen. Kerry: I agree that the U.S. gas industry has made impressive strides in improving drilling techniques and in protecting the environment. I believe that additional oil and gas development should be prioritized around lands that are already open to drilling, but which have not yet been developed. I would encourage production from already-leased lands first, before opening up new areas to leasing. This approach applies to offshore drilling as well. I will continue to support oil and gas development in the western Gulf of Mexico off of Texas and Louisiana. I support the moratorium on oil and gas drilling offshore of California and on the eastern seaboard, and I will not open up new areas off the coast of Florida to oil and gas production.

American Gas: Turning specifically to electricity generation, because of natural gas's environmental benefits, current law ensures that the vast majority of new power plants will be gas-fired. Yet this only exacerbates the current demand-supply imbalance and puts upward pressure on natural gas prices for homeowners and businesses. That is why many experts favor a more balanced approach, using more clean coal and nuclear energy to generate electricity. Would you support increasing the use of clean coal and nuclear energy to achieve this more balanced approach?

Sen. Kerry: Over-reliance on a single fuel or energy source is not in the best interest of the American people. For a national energy plan to be a success, it must be diversified and balanced—that includes recognition of the importance of nuclear power. I support nuclear energy, but I believe that we need to make new progress in solving the challenges of disposal and must remain vigilant in ensuring safety and security.

Coal has been and will remain a central part of our energy mix and an important engine for the economy of key parts of this country. I reject the old thinking that the use of coal is an environmental problem. I believe that it can be part of the solution. For that reason, my energy plan calls for an unprecedented investment in and commitment to clean coal technologies. Truly advanced technologies like gasification can ensure that coal remains a central part of both our energy future and a cleaner America.

American Gas: Outsourcing American jobs overseas is a high-profile issue, yet a primary reason U.S. firms have shut down and moved overseas is the high cost of energy, including natural gas. You support increased conservation and the use of renewables as two ways of alleviating energy costs, but conservation can go only so far, and alternative energy sources such as solar, wind and hydrogen won't be a significant contributor to the energy mix for 10 to 20 years. Meanwhile those jobs are being lost today. What other steps would you take to make energy more affordable in the near term?

Sen. Kerry: The affordability of energy in this nation must be addressed since it fundamentally affects our economy. There are specific mechanisms that can provide short-term price relief, but I believe the best solution is in long-term policies that will move us toward a more balanced and less dependent energy future. I firmly believe that conservation, increased energy efficiency and renewable energy all must be considered as part of a total energy plan. A Kerry administration will support immediate steps to increase natural gas supplies and improve natural gas infrastructure and will seek near-term commercialization of advanced clean coal and other alternative energy sources that will relieve energy costs on American business. This energy plan is an important part of my overall economic policy that will ensure high-paying jobs stay in America.

American Gas: Speaking of affordability, there is a lot of support for importing more liquefied natural gas (LNG) as one solution to the supply and price crunch. Others worry about a growing reliance on LNG imports, with all of the attendant concerns about energy security, jobs lost in the domestic natural gas industry and dollars shipped out of the country to pay for foreign imports. How do you view LNG, and if you support its increased use, how would you expedite the siting of new LNG plants?

Sen. Kerry: LNG is a part of the global solution for increased energy demand. We must work to find technology applications that make LNG more readily available and protect surrounding communities from unnecessary risks. This source of potential new natural gas supply presents challenges—both as to source, since it must be imported, and its required infrastructure. If done properly, however, LNG can be part of a balanced energy portfolio for the United States' energy future.

American Gas: Americans are rightly complaining about the high costs of energy, yet polls repeatedly show that Americans have little or no idea of where energy actually comes from, what risks and roadblocks energy companies face in exploring for and developing new sources of energy, and the many operational challenges they must meet to deliver it to the consumer safely, securely and reliably—all of which factor into the price of energy. Do you agree that a national energy education program would be beneficial in bridging this knowledge gap, and if so, how would you implement it?

Sen. Kerry: Consumer education and awareness are important in any context. I believe that an energy education program would be beneficial. But the duty to inform the American people about the implications of our energy use lies first and foremost with the President. We need a President who is honest with the American people about how we develop energy policy and about the costs and tradeoffs that are part of our current approach.

American Gas: The Low-Income Home Energy Assistance Program (LIHEAP) provides heating and cooling bill payment assistance to low- and fixed-income energy consumers, most of whom have annual incomes of $10,000 or less. Every year, due to federal budget pressures, LIHEAP comes under heavy scrutiny by Congress, yet the recent colder-than-normal winters in much of the country have significantly increased the number of Americans in need of help. In Massachusetts, for example, from the winter of 2002 to this past winter, the number of people receiving LIHEAP jumped nearly 9 percent. Do you believe LIHEAP is an effective program, and would a Kerry administration continue to support this program at current levels or higher?

Sen. Kerry: LIHEAP is an effective program that not only helps our low-income citizens pay their heating and cooling bills, but also ensures that our most vulnerable citizens-our children and the elderly—remain healthy and safe in their homes. The LIHEAP program served 5 million families last year, but the caseload increased by 660,000 families in the past two years. A Kerry administration would recognize how critical the LIHEAP program is to our low- and fixed-income citizens and would support an increase in funding.

American Gas Association