Guest opinion: Energy development is good for us all
Recently, there has been much discussion related to oil and gas production in Colorado. In fact two initiatives that barely missed making this year’s ballot would have drastically curtailed development. One would have effectively banned 80 percent of future oil and gas production while the other would have led to an unworkable patchwork of local regulations. The passage of either could have proven very detrimental to not only the energy industry but our entire state.
Unfortunately, there is a perception by some that only the major oil and gas companies gain from energy development. This view could not be further from the truth. All of us, in one manner or another, benefit from the presence of this important industry and the jobs, economic development, and tax revenue that it generates.
Why is the energy industry so important? We only need harken back 15 years, when even a minor incident in the Middle East could trigger spikes in fuel prices due to our dependence on foreign oil. This roller coaster was bad for all business but particularly those, like ours, who are dependent on fuel. Since then with the advent of horizontal drilling and advances in the decades-old technique of fracture stimulation, the energy industry has been able to unlock key resources in the U.S., placing us on the cusp of energy independence.
This domestic development has been a boon for Colorado and the nation, generating billions of dollars in business activity and tax revenue while reducing our trade deficit.
One somewhat forgotten contribution to Colorado was the oil and gas industry’s role in the last economic recession. The old phrase “a rising tide lifts all boats” was an appropriate analogy during that time. While many industries were cutting operations, the “rising tide” of energy development in Colorado softened the blow to our economy. Energy development helped to keep afloat many businesses within our state as it invested heavily in our state’s economy. Without this important industry to bolster our economy we would have witnessed far more business failures and job losses.
In the trucking industry, we see the positive impact of the energy industry daily. While only 10 percent of our companies are directly involved in the oil and gas development, the remaining 90 percent benefit from the presence of this important industry. The annual infusion of $30 billion by this industry into our economy has a ripple effect that cuts across all sectors. This translates into more consumer purchases, additional equipment orders, greater food demand, and increased construction activity. For us, this translates into more freight, additional truck purchases, and ultimately more jobs.
All of us have also benefitted from the lower costs and stability associated with domestic energy production. While fuel prices may fluctuate, we no longer see wild swings and it has also led to lower fuel prices. The difference between diesel at $4 versus $2.50/gallon is an annual savings of $25,000 for one long-haul truck, which is passed along through lower costs to businesses and consumers.
There is an old phrase that says, “If you got it, a truck brought it.” It refers to the essential nature of our industry to our everyday lives. Almost everything in our homes, everything we eat, wear or use travels by truck to reach its destination. The energy industry is similar in how it touches our lives daily whether it is heating our homes, fueling our vehicles, or being used in agriculture or manufacturing. Rather than looking to curtail this industry, we should look at working as partners with the energy industry to increase responsible and safe production. If that occurs, we all win.
Jeff Cummings is the chairman of the board of the Colorado Motor Carriers Association, which represents more than 650 companies involved in trucking in Colorado. He is the president and CEO of Duffy Crane and Hauling, one of Colorado’s oldest companies.
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