Former Texas Governor Rick Perry appeared before the Senate Energy and Natural Resources (SENR) Committee today in the first step towards confirmation as Secretary of Energy.
Perry was introduced by two senators—one from each party—who emphasized Perry’s long tenure (14 years) as chief executive of the State of Texas. Sen. John Cornyn (R-Texas) noted that Perry, “is not a status quo kind of guy… he is a leader, an innovator, and [a problem-solver].” Sen. Joe Manchin (D-West Virginia) said that he got to know Perry when they were both governors and that during the aftermath of the 2005 Gulf hurricanes Perry, “had thousands of people depending upon him… and ‘he never missed a beat.’ During those challenging times his resourcefulness and managerial skills were on full display.”
In his introductory remarks, Perry also emphasized his executive experience in managing “the twelfth largest economy in the world” (meaning Texas, of course). He also touched upon the various missions of the Department of Energy (DOE), from maintaining the U.S. nuclear weapons stockpile, cleaning up Cold War-era nuclear waste, maintaining America’s national laboratories, and “advancing U.S. energy in all forms.”
Responses to Questions
Perry fielded questions from SENR members on a range of parochial and broader issues. The committee hearing was webcast live and is also available in archive form. A quick recap of the questions related to natural gas and liquefied natural gas (LNG) issues.
In response to a query from Sen. John Hoeven (R-North Dakota), Perry noted that both Texas and North Dakota were altered “in a life-changing way by hydraulic fracturing… a technology that had its genesis at the Department of Energy” and “I will continue to support a [robust DOE R&D program] that will benefit people around the world.”
The first question about LNG came from Sen. John Barrasso (R-Wyoming): “I want to turn to [LNG]. There’s certainly a lot of [natural gas] in Wyoming and Texas, and since 2010, the department’s permitting process for LNG exports has been ‘unpredictable.’ Last Congress, some of us on this committee worked in a bipartisan way… to expedite the department’s permitting process… and both the Senate and House passed our legislation with strong bipartisan support… If confirmed will you commit to acting on the pending LNG export applications—because they are all piled up there—and do it in a timely manner?”
Perry replied: “Senator, I will follow the laws and I will follow the clear instruction that I see as Congress goes forward, obviously working with the administration. My understanding from having conversations with president-elect Trump is that he truly is an ‘all-of-the-above’ supporter of American energy and that he will support, develop, and promote our energy resources, with liquefied natural gas being one of those.”
Barrasso followed up by saying, “we are going to reintroduce the legislation and I would hope that you would work with us in a bipartisan way to ensure that not just you, but your successors, act on LNG applications in a timely manner. We have such an abundance of natural gas in this country [and other nations] use energy as a geopolitical weapon… We are an energy force in this country and I believe we should be acting as the international energy force that we are, and I would like to ask for your help with legislation so that your successors also follow the law.” A smiling Perry responded, “I will be available to work with you on any given day.”
Sen. Debbie Stabenow (D-Michigan) asked Perry about an article in The Hill (Jan. 19) saying that the incoming administration is considering major DOE budget cuts and possible elimination of certain DOE offices, including the Offices of Renewable Energy and Fossil Energy. Perry responding by saying, “I can’t answer whether that’s true or not, but what I can tell you is that I know that—from my perspective—moving America forward on [energy R&D], is vital for the country’s security and I have no concerns about whether the Trump administration will be supportive of keeping America strong and free and the technologies that come out of DOE will play a very important role… I will be an advocate for that and I will be in the room advocating for these types of things. I’m not going to tell you that I’m going to be 1,000 percent successful, but I can assure you that I [will continue to try to bring science and economics together.]”
Several other senators also asked Perry about The Hill story concerning rumored DOE budget cuts and office eliminations. Sen. Angus King (I-Maine), for example, asked Perry if he would be “lion-hearted in this endeavor to protect your agency?” Perry responded saying, “Senator, I have a rather interesting background—not unlike yours—of defending budgets, both from those who are ‘in the know’ and sometimes people who don’t know . . . Sen. King gently interrupted, saying, “It’s hard for me to believe that the people who are recommending these cuts are in any kind of ‘know.’ Perry nodded his head “yes” and said, “I will allow your statement to stand.”
King then turned to LNG exports, saying: “Here’s what’s of concern to me . . . The total production of natural gas in the country is about 75 [billion cubic feet] bcf per day. We’ve already approved 14 bcf (which is about 20 percent of the total production) for export. And, in the ‘queue’ is 71 percent of the production for export. If that happens, there is no way in the world that this Congress can repeal the law of supply and demand and there is no way in the world that will not drastically and significantly effect domestic prices, which has been one of our advantages vis-a-vis the rest of the world in terms of bringing manufacturing back and sustaining our economy. The Natural Gas Act back in 1938 says that if the Department of Energy is to issue a permit, it has to ‘be in the public interest.’ My request of you is to be sure that the ‘public interest’ definition includes effect on domestic prices. Will you give me that commitment?
Perry responded: “Senator, what I will commit to is finding ways to make sure that we don’t artificially affect supply and demand. What I will suggest to you is that there are decisions that have been made in Washington, DC, that have artificially affected supply and demand and it has been on the supply side. I would ask the EPA [Environmental Protection Agency] and the Department of Interior and the Congress—when it is on the tax and regulatory side that they can affect—to make sure that we have the ability to fill the supply, because the demand is going to be there. And, if we produce it in America, it makes abundant good sense to me for us to sell it to the world.”
King replied: “Unless doing so significantly increases domestic prices, which is exactly what happened in Australia where they are now exporting almost all of their natural gas and their [domestic prices] nearly tripled. That would be a disaster for the economy of this country.” Perry: “I totally understand that, but my point is that when we look at this entire issue globally, we need to make sure that we’re not making decisions here that affect the ability to supply so that you can keep the demand addressed in a thoughtful and fair way that does not drive up cost to where a manufacturing base—for instance, where we are trying to bring America back in a strong and powerful way—would be affected in a negative way.” King then said, “Low priced natural gas is an advantage that I would hesitate to lose.”