Our federal government has historically allowed oil and gas companies to lease America’s public lands across the West for exploration and drilling. One reason for doing this has been to spur economic activity; the other is to generate revenue to the U.S. Treasury on behalf of the landowners…you, me, and the rest of the taxpaying public. In recent years this oil and gas leasing program, which is run by the Bureau of Land Management (BLM), has fallen short on both counts. The process is supposed to work like this: Leases are offered at auction for lands that have been nominated by interested parties. The idea being that these interested parties, ostensibly oil and gas companies, will bid against each other for these leases and drive up the price. That only works if the parcels being offered up for lease have a strong potential to produce lots of oil. However, too often that is not the case. One problem is that BLM allows our public lands to be nominated for leasing anonymously, and pretty much accepts any nomination without scrutiny. This has allowed oil companies and other speculators to nominate huge swaths of land for leasing, often in an attempt to hide which parcels they are actually interested in from potential competition. That brings us to another big problem, price. When the competitive bidding process is thwarted, BLM offers leases on the nominated land for a paltry minimum bid of $2 per acre—which is essentially a big government handout. In addition to shortchanging the American taxpayer to the tune of $12.4 billion between 2012, these practices are also shortchanging the...
As conservatives, we firmly believe in capitalism and the free market. The mantra “follow the market” instinctively makes sense to us. However, to do that, we must understand and accept what the market is telling us. The energy market has always changed over time. When our country was founded, the primary energy source used was wood. Water mills also played a role for a while. Then the use of coal began to dominate starting in the late 19th century. Oil has played a big role as well, but mostly in the transportation sector. The widespread use of electricity changed the energy picture dramatically. Instead of being burned in homes, coal was used to fuel power plants. Midway through the twentieth century, nuclear power emerged as another option for generating electricity. Over the past two decades, natural gas gradually gained the upper hand over coal and nuclear as the primary fuel stock for electric power plants. Gas burns cleaner and has logistical advantages over coal, while nuclear has been hampered by cost and safety concerns. Today, advances in solar and wind energy, along with similar advances in energy storage technology have vaulted those energy options over those more traditional sources in both cost and reliability. Part of the reason this is happening is that coal and gas fired power plants have become more expensive to operate and maintain as they age. This is a big deal, because 88% of our nation’s coal-fired power plants, which have a 40-year life expectancy, were built between 1950 and 1990. The average age of our nation’s natural gas plants is 22 years old—and they...
