The United States is undergoing an energy revolution and Pennsylvania is at the forefront, industry experts said at an energy summit held Thursday by the Greater Reading Chamber Alliance.
“It’s an exciting time to be in energy in Pennsylvania,” Pam Witmer, vice president of government affairs, UGI Energy Services, based in Wyomissing, told the audience at the Crowne Plaza Reading in Wyomissing.
Pennsylvania is a leader in natural gas production, saving consumers in the state $30.5 billion between 2006 and 2016, Witmer said.
Hydraulic fracking in the Marcellus shale area Pennsylvania, which began about 10 years ago, has boosted the state to become the second-largest producer of natural gas in the country.
Keynote speaker Dan Byers, vice president of policy at the Global Energy Institute at the U.S. Chamber of Commerce, said oil and gas production in the U.S. has “skyrocketed” and will continue to grow over the next few years, particularly in natural gas.
“We are just getting started,” Byers said.
“Now we’re the world’s No. 1 oil producer. People don’t realize we have passed Saudi Arabia and Russia,” he said.
The U.S. is producing more than 10 million barrels a day, a figure projected to increase to 11 million by next year.
While everyone understands the economic benefits of the U.S. as a source of oil production, Byers said it has even wider geopolitical implications because of political instability in oil-producing countries such as Iran and Venezuela.
“When we’re at 11 million barrels a day versus 5 million barrels a day, there’s a lot less concern and it really changes the way this country responds,” he said.
Byers described how growing domestic energy production has made U.S. electricity costs the cheapest in the world. The rates in industrialized countries such as Germany and Japan are more than double those here, he said.
Pennsylvania’s electricity cost of about 10 cents per kilowatt puts it near the national average of about 10.5 cents per kilowatt. But it is the cheapest among northeast states, where prices range from 13 cents to 15 cents.
“That certainly makes a difference among lower-income households,” Byers said.
Pennsylvania’s natural gas production is fueling construction of natural gas power plants, driving down power prices and spurring demand for ethane used in the manufacture of plastics and petrochemicals. To meet some of the latter demand, Royal Dutch Shell is building a $6 billion ethane cracker plant in western Pennsylvania.
Two or three more shale cracker plants are expected to be built in the western Pennsylvania, Ohio and West Virginia region. Byers said they will be “an anchor for economic development that I assume will spread all the way throughout the state.”
Other countries, meanwhile, are interested in buying liquid natural gas from Pennsylvania, but some of the export terminals that need to be built are facing delays, including from environmental activists, Byers said.
Pennsylvania earned more than $200 million in gas-impact revenues last year that was distributed to state and local programs, including in counties that don’t have natural gas production, he added.
