Republican News

Republican News

DASCHLE, MURKOWSKI URGE SENATE TO HELP DEVELOP AMERICAN NATURAL GAS ON HEELS OF NEW FINDINGS WASHINGTON, D.C. – Majority Leader Tom Daschle (D-SD) and Senator Frank H. Murkowski (R-AK) today called on the Senate to redouble their commitment to developing Alaska’s natural gas after a new report by Charles River Associates Inc., widely respected as a national leader in independent, non-partisan energy analysis. The new report finds the increased supply of natural gas made possible by the Alaska gas pipeline will help guard against price spikes associated with future demand increases. The report also shows the pipeline will contribute $65 billion to American and Canadian economies by 2020. Further, the proposed ‘safety net’ plan to help development is likely to have no cost to taxpayers. Majority Leader Tom Daschle said that, “there is broad bi-partisan support in the Senate for the Alaska gas pipeline project. The Charles River analysis is further confirmation that this project will make a significant, long-term contribution to America’s energy position. It will also create jobs, reduce energy costs and spur economic development in Alaska.” “More and more, natural gas is the fuel of choice to help meet America’s future energy needs,” said Senator Murkowski. “In this new age of awareness of external threats to our nation, safe and secure North American sources must be encouraged. We must make certain that the energy behind our power plants is American made so we can further guarantee our energy security.” “This report shows the wide scope of the positive economic benefits of developing Alaskan gas,” added Murkowski. “The development of such a massive project is always a risky proposition – that’s why the ‘safety net’ was developed to help reduce the risk and establish some degree of economic certainty. “The study confirms our belief that the ‘safety net’ will have minimal impact to the markets and to the taxpayers,” said Murkowski. “That is why the provision received a zero revenue score from the Joint Committee on Taxation. Without the net, it’s clear that it would be very difficult for this pipeline to ever move off the drawing board.” A complete copy of the report is available at www.crai.com Executive Summary Natural gas is a clean fuel, of which there are large resources in the U.S. and Canada. Use of natural gas tends to reduce dependence on imported energy from outside NAFTA and decrease emissions of carbon dioxide, a greenhouse gas believed to contribute to global warming. The Alaska Gas Pipeline (AGP) will enable a major new source of domestic energy to be brought to market at a time when new sources of clean natural gas will likely be needed. · The AGP will strengthen the North American natural gas supply portfolio by increasing the proportion of long- lived supplies. · The additional supplies will moderate future natural gas price increases and will reduce the risk of price spikes in the future. · It will benefit the U.S. and Canadian economies, providing regional economic benefits in the form of jobs and investment during construction, and durable benefits of lower cost energy to all consumers. North American nominal GDP will increase by about $35 billion in 2015, $65 billion in 2020, and more in later years. · Tax credits will likely cost the government nothing. Any payments will be temporary, due to unusual market conditions, and very small relative to benefits to consumers. · The new source of supply will quickly be absorbed. Markets will have ample time to adjust. The tax mechanism is not a price floor and will not create market distortions or prevent market prices from moving to keep supply and demand in balance. · The U.S. and Canadian natural gas exploration and production industries will remain buoyant. · Government support fo r the ANS pipeline would not violate the WTO subsidy code. · The ANS gas pipeline tax mechanism is clearly within the spirit of existing, effective governmental incentives provided by the U.S. and Canada. ###