An Action Plan for America’s Energy Security

COMMENTARY Energy Economics

An Action Plan for America’s Energy Security

Apr 7th, 2022 3 min read

Commentary By

Drew Bond

Co-Founder of C3 Solutions

James Jay Carafano @JJCarafano

Vice President, Kathryn and Shelby Cullom Davis Institute

We must recognize the policy bottlenecks needlessly constraining energy production and remove them immediately. SimpleImages / Getty Images

Key Takeaways

National security is contingent on an uninterrupted supply of reliable, affordable energy.

It’s not a lack of supply that inhibits mining here; it’s an over-abundance of regulations.

It’s time for solutions. More importantly, it is time for action.

National security is contingent on an uninterrupted supply of reliable, affordable energy. Without it, factories close, transportation slows down, and the military is paralyzed. Just the threat of an energy cut-off can force governments to alter domestic and foreign policy.

Though Western European leaders knew that their “greening” of domestic energy production had left them undesirably dependent on Russian oil and gas, President Vladimir Putin’s invasion of Ukraine jolted them into realizing just how vulnerable they had become. Virtually overnight, Germany and other Western nations reversed long-held policies, determined to become more energy self-sufficient.

Will the U.S. follow suit? Will it unleash the full productive and innovative capacity of the American economy in a renewed drive for energy security?

To do this, we must recognize the policy bottlenecks needlessly constraining energy production and remove them immediately. The biggest problems right now are government regulations that impede domestic mining for rare earth minerals and the further development of every form of energy, from conventional fuels to nuclear power to renewables.

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Let’s start with rare earth elements, the 17 natural elements that are essential to energy technology innovation. These minerals are needed to manufacture almost all high-tech products, including cell phones, batteries, airplanes, solar panels, wind turbine blades, satellites and military technology.

Today, we import 80% of the rare earths we need from China. We must make sure the rare earth supply chain cannot be cut off, even temporarily. Such disruptions have happened before.

About a decade ago, China decided to use its control of rare earth mining as a tool against Japan. Rather than suffer in silence, the Japanese reacted by building a replacement supply chain independent of China. As a result of Tokyo’s action, China’s global market share dropped from 95% to today’s 70% and gave the Japanese much-needed breathing room.

The lesson is that markets work … if we let them. The United States must take a similar step. We must diversify our supply chains to include ensuring access to refining facilities. Beyond that, we must mine more of the rare earths right here in America.

Currently, the Mountain Pass facility located in California is the only rare earths mine operating in North America. It grosses $100 million annually, so there is no question that rare-earth mining in the U.S.is commercially viable.

It’s not a lack of supply that inhibits mining here; it’s an over-abundance of regulations. The current permitting process to commence mining operations takes between 7 and 10 years. No business will risk investing millions up front and not getting a timely permit.

The same holds true for other energy infrastructure. The company proposing to build the Keystone XL pipeline to bring a stable oil supply to American refineries first applied for a permit in 2008. One of the first acts of the Biden administration was to block the pipeline’s approval. If we can’t approve, let alone build, a single pipeline in 14 years, what signal does that send to prospective energy development investors?

Similarly, the success of wind and solar projects will hinge not on more subsidies but more efficient siting and permitting processes for things like the construction of new transmission lines.

There is plenty more red tape to cut as well. Lawmakers should also reform, if not completely repeal, the National Environmental Policy Act. This federal law requires every executive branch department to assess the environmental effects of major public works projects and other budgetary and regulatory actions with potentially significant effects. NEPA was intended to protect the environment. But, the way the executive branch interprets it today slows down progress and drives up costs for clean energy and infrastructure projects that would benefit the environment.

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Judicial review for NEPA projects takes at least two years and runs up burdensome court costs. Lawmakers should reform NEPA by resolving judicial reviews within 60-120 days. This would immediately drive free-market investment into new green energy projects.

When it comes to energy policy, the group on the “right” is calling for more domestic oil, gas and coal production now, while the group on the “left” is calling for more green energy production now. Somewhere in the middle, a group is calling for more “all of the above” energy production, including nuclear. Ironically, none of it will be possible until we get serious about cutting red tape.

If public policy leaders will once and for all come together around this issue and slash red tape, they will deliver a better present and a more prosperous—and secure—future for the American people.

It’s time for solutions. More importantly, it is time for action.

This piece originally appeared in The Washington Times