OPINION:
We often take a rather insular view of public policies at the state level — the notion that what happens in the state stays in the state, to paraphrase the famous marketing line.
Unfortunately, that is not always the case. Sometimes a policy implemented in one state or another involves an issue with national implications; other times it is simply a matter of certain ideas (good or bad) gaining ideological traction and being exported to other states. In Colorado this year, both scenarios apply.
The Colorado General Assembly is again debating the future of energy production in the state. Several legislative proposals have been introduced that would, to varying degrees, serve to curtail oil and natural gas development or wrap that development in so much superfluous regulation and red tape that it could never get off the ground.
At least one of these — and the most radical and egregious — is a bad idea imported from California, which last year imposed a near-halt on new oil and gas permits. Senate Bill 159 in Colorado would have done virtually the same thing, instituting a complete ban on all new oil and gas permits over the next five years.
Fortunately, this extreme measure proved a bridge too far even for Colorado’s Democratic supermajority Legislature and was narrowly voted down in committee. But a mirror-image ballot initiative is in the works to try again, and several other bills have been introduced that would do just as much damage to the state’s energy sector over time.
Such measures are being considered now. They would impose restrictions such as periodic “seasonal” bans on oil and gas development and shift the regulatory goal posts, leading to new layers of red tape and ultimately grinding the state’s domestic energy industry further into the ground.
It goes without saying that should these bills pass, the impact on Colorado’s economy would be devastating. Previous attacks on the industry by the state government have had profound consequences for the mostly rural counties that suffered job losses and sharp declines in economic activity in the aftermath. Even so, the oil and gas industry in Colorado remains a major job creator, supporting 153,000 jobs in the state in 2022. It is not difficult to guess what the effects would be if these efforts to virtually eliminate the industry ultimately succeed.
But we don’t need to guess. We simply need to look west to California to see what has happened there. In the wake of that state’s ban on oil and gas permitting, California’s electricity sector has suffered rolling blackouts, and the state — once among the top U.S. energy producers — increasingly relies on imports of energy from other, less myopic places. Colorado risks having the same thing happen here.
The impact of similar policies in Colorado would also not be confined solely to the Centennial State. Domestic energy production is necessarily a national matter. In 2021, Colorado was the eighth-largest natural gas producer in the nation and one of the top 10 states for total energy production. This is a significant amount of energy resources that, if taken off the table by demagogic regulatory fervor, will have an equally significant impact on America’s energy industry and security.
National energy policy has always been of central importance, and that is only becoming clearer as we watch what is happening in the world beyond our borders. Russia’s aggression in Ukraine and the renewed threat to European security have, more than anything, highlighted the importance of a sound energy policy. Unfortunately, America’s response has been underwhelming, to say the least.
The Biden administration’s ban on liquefied natural gas exports, in particular, is an especially shortsighted strategic error. The United States, with our vast reserves of natural resources and inherent entrepreneurial ability to develop them safely, efficiently and responsibly, should be well placed to help meet not only our own but also the world’s energy challenges. But in order to do so, both the federal and state governments need to do their part to implement sound energy policy based on reality, not dogmatic extremism.
The individual states in our system of government are indeed the laboratories of democracy, and California’s misguided experiments in energy policy have failed. It is not too late to turn things around in Colorado, which is headed down a similar path, but legislators and voters must act quickly and vote wisely. Other states should also be cautious about joining California’s “race to the bottom” on energy, as there is simply too much at stake.
• Scott Tipton represented Colorado’s 3rd Congressional District from 2011 to 2021, serving on the House Agriculture, Natural Resources and Small Business committees and the Financial Services Commission.
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