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Regulatory Robbery: Nat-Gas-consuming companies want to restrict gas exports

January 15, 2013 | 11:27 am
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A handful of companies have formed America’s Energy Advantage, which is lobbying to curb the export of natural gas. If you’ve been paying attention, you can probably guess who AEA is: U.S. corporations that buy natural gas and don’t want foreigners bidding up the price on gas.

Mark Perry, at AEI (where I am a visiting fellow) lays it out as a case of rent-seeking by these gas-consuming companies, like Dow and Alcoa:

 Energy-intensive US manufacturing companies like Dow Chemical, Nucor (the country’s largest steel producer) and Alcoa have benefited significantly from historically low natural gas prices, and want to restrict natural gas exports through the political process, to protect their lower energy prices and higher profits. They like the “unfettered” profits they enjoy because of lower energy costs, but they want to prevent the “unfettered” exports of natural gas by the companies that have produced that “wealth.”  In public choice terms, Dow, Nucor and Alcoa are now devoting resources to influence public opinion and the political process “in order to be given a share of wealth that has already been created” by oil and gas producers.

Scott Lincicome in the fall reported that Obama was on board with these restrictions, and Lincicome suspected political motives.

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