National Security Advisor Tom Donilon spoke at the launch of Columbia University's Center on Global Energy Policy on April 24, 2013. He discussed the effects of U.S energy policy on the economy, environment, international relations, and national security.
Excerpt from Donilon's remarks:
"First, the new U.S. energy posture and outlook will directly strengthen the nation's economy. There are not a lot of iron laws of history. But one is that, as the President has said, a country's political and military primacy depends on its economic vitality. Our strength at home is critical to our strength in the world, and our energy boom has proven to be an important driver for our economic recovery—boosting jobs, economic activity, and government revenues. Take the example of North Dakota, where unemployment has dropped to near 3 percent, the lowest in the country, and the state has a $3.8 billion budget surplus, largely due to increased unconventional gas and oil production in the state. IHS CERA estimates that shale gas supported direct and indirect employment for 600,000 Americans in 2010, a number that could double by 2020.
America's natural gas boom is helping to spark a domestic manufacturing revival. Manufacturers in energy-intensive sectors have announced up to $95 billion investments across the U.S. to take advantage of low-cost natural gas. The largest investments announced have been in the chemicals sector which uses natural gas as a feedstock, but there have also been major announcements in other industries like steel, plastics, and glass. For the first time in over sixty years, the United States is exporting more refined petroleum than it is importing. The reduction in energy imports has a positive impact on our trade balance, helps lower domestic and global energy prices, and allows a greater share of the money Americans spend on energy to remain within the U.S. economy.
Furthermore, as a result of the Administration's historic investments in clean energy, tens of thousands of Americans have jobs and America is now home to some of the largest wind and solar farms in the world.
Domestic economic developments like these improve U.S. standing and send a powerful message that the United States has the resources, as well as the resolve, to remain the world's preeminent power for years to come.
Second, America's new energy posture allows us to engage from a position of greater strength. Increasing U.S. energy supplies act as a cushion that helps reduce our vulnerability to global supply disruptions and price shocks. It also affords us a stronger hand in pursuing and implementing our international security goals.
For example, the United States is engaged in a dual-track strategy that marshals pressure on Iran in pursuit of constructive engagement to address the world's concerns about Iran's nuclear program. As part of the pressure track, the United States engaged in tireless diplomacy to persuade consuming nations to end or significantly reduce their consumption of Iranian oil while emphasizing to suppliers the importance of keeping the world oil market stable and well supplied. The substantial increase in oil production in the United States and elsewhere meant that international sanctions and U.S. and allied efforts could remove over 1 million barrels per day of Iranian oil while minimizing the burdens on the rest of the world. And the same dynamic was at work in Libya in 2011 and in Syria today.
Third, the development of a more global natural gas market benefits the U.S. and our allies. We have a strong interest in a world natural gas market that is well supplied, diverse, and efficiently priced. Increased U.S. and global natural gas production can enhance diversity of supply, help delink gas prices from expensive oil indexed contracts, weaken control by traditional dominant natural gas suppliers, and encourage fuel switching from oil and coal to natural gas.
A decade ago, market analysts forecast that the U.S. would need to import large volumes of natural gas by pipeline and LNG. Since then, domestic production has reached historic highs and domestic natural gas reserves have almost doubled. Gas supplies originally destined for the United States are being redirected to other countries.
Many of our allies have expressed interest in the potential of the United States as a global natural gas supplier. The Department of Energy is currently reviewing at least seventeen applications to export U.S. LNG to non-Free Trade Agreement countries. It will conduct a comprehensive review of all relevant factors to determine whether each non-FTA LNG export project is deemed to be consistent with the public interest.
Global demand for natural gas is projected to rise by one-fifth over the coming decade. Burning natural gas is about one-half as carbon-intensive as coal—which makes it a critical "bridge fuel" as the world transitions to even cleaner sources of energy.
Fourth, reduced energy imports do not mean the United States can or should disengage from the Middle East or the world. Global energy markets are part of a deeply interdependent world economy. The United States continues to have an enduring interest in stable supplies of energy and the free flow of commerce everywhere.
We have a set of enduring national security interests in the Middle East, including our unshakeable commitment to Israel's security; our global nonproliferation objectives, including our commitment to prevent Iran from acquiring a nuclear weapon; our ongoing national interest in fighting terrorism that threatens our personnel, interests and our homeland; our strong national interest in pursuit of Middle East peace; our historic stabilizing role in protecting regional allies and partners and deterring aggression; and our interest in ensuring the democratic transitions in Yemen, North Africa and ultimately in Syria succeed.
Which brings me to my fifth point: though it is typically discussed in terms of its energy, environmental or economic implications, the changes to our climate that we are seeing are also a national security challenge.
The national security impacts of climate change stem from the increasingly severe environmental impacts it is having on countries and people around the world. Last year, the lower 48 U.S. states endured the warmest year on record. At one point, two-thirds of the contiguous United States was in a state of drought, and almost 10 million acres of the West were charred from wildfires. And while no single weather event can be directly attributed to climate change, we know that climate change is fueling more frequent extreme weather events. Last year alone, we endured 11 weather-related disasters that inflicted a $1 billion or more in damages – including Hurricane Sandy."