Cheaper oil: the raise you didn’t get
Marketwatch, featuring John DeCicco
Despite steady job growth in 2015, wage growth remained relatively stagnant for many Americans last year. Two-car households could save an average of $1,000 a year on what they would normally spend on gas, McBride estimates, calling the extra cash “the pay raise most people haven’t gotten.” For the average consumer, the additional income may translate into increased spending on discretionary items like restaurants and tourism that was originally expected when prices first dropped in 2015.
Low-income households will feel the most relief and see more flexibility in their budgets, says John DeCicco, a research professor at the University of Michigan Energy Institute. “We expect people are going to be more relaxed and consume more,” he says.
What’s more, the “raise” from cheap oil tends is often frittered away—much like real raises from an employer—unless consumers make a conscious effort to sock it away. From May 2014 to May 2015, about 40% of consumers ended up spending their gas savings on necessities rather than saving or spending it on recreational activities, according to a Bankrate survey of 1,000 Americans. Since lower gas prices can sneak up on people, only the most well-budgeted households may see a bump in their savings accounts.
Now Is The Time To Raise The Gas Tax, Engineer Says
Mark Barteau Says Some Of The Savings From Low Gas Prices Should Be Reinvested In Infrastructure, Energy Research
Wisconsin Public Radio, featuring Mark Barteau
With the national gas price average now below $2 per gallon, American consumers are finding substantial relief at the pump. With those savings, one environmental engineer is proposing an increased gas tax to reinvest money to roads, energy research and new clean technologies.
Mark Barteau, the director of the University of Michigan’s Energy Institute, basically thinks it would be wise if instead of living it up, Americans instead curb their energy appetite and consider the possibility of long-term low energy prices.
Barteau said gas retail sales in the U.S. were up 28 percent for the first nine months of 2015. And as for longer-term consequences, the average gas mileage of cars sold in the country have decreased from 25.8 in the summer of 2014, to 25 in November of 2015. In other words, said Barteau, the country is producing less efficient cars and failing to scale back greenhouse emissions.
“There’s a double whammy here, because not only are we buying less efficient cars, but the amount of travel tends to go up when gasoline is cheap as well,” he said.
Aliso Canyon: How bad is the California gas leak disaster?
In Los Angeles, an invisible environmental disaster is unfolding.
Since 23 October, natural gas has been leaking from a ruptured storage well in Aliso Canyon owned by the Southern California Gas Company (SoCalGas), spreading into the suburban neighbourhood of Porter Ranch.
The volumes of gas involved are enormous.
The most recent official estimate from California’s Air Resources Board (CARB) is that 66,000 tonnes of methane had spilled out from the well, as of 22 December.
A real-time counter maintained by the US-based campaign group Environmental Defense Fund estimates the total leakage on a second-by-second basis.
Administration pushes $220M electric grid upgrade program
The Department of Energy is looking to pump $220 million into a program to upgrade the American electric grid.
Energy Secretary Ernest Moniz announced the push Thursday, saying the funding would help advance grid research at the agency’s national laboratories and private-sector partners.
“This public-private partnership … will help us further strengthen our ongoing efforts to improve our electrical infrastructure so that it is prepared to respond to the nation’s energy needs for decades to come,” Moniz said in a statement.
Updating the energy grid has been a major priority for the Obama administration, and it was a key plank of the first “Quadrennial Energy Review” the Energy Department released in April.
At the time, the Obama administration said it would seek nearly $4 billion to modernize the electric grid. Republicans broadly agreed with many of the policy ideas presented in the energy policy review, and both chambers are pushing energy overhaul bills with grid modernization provisions in them.