Washington, DC –– The American Gas Association (AGA), which represents the natural gas utility industry, today said several tax provisions included in President Obama’s budget proposal could prove harmful to natural gas customers.
By changing the tax laws that address intangible drilling costs, geological and geophysical expenses, the depletion allowance and the manufacturing deduction, the budget would discourage independent energy producers from discovering and producing natural gas.
“When supply shrinks and can’t keep pace with demand, prices must rise— so the 171 million Americans who rely on natural gas to heat their homes and cook their food could see higher energy bills should these provisions pass,” said David Parker, president and CEO of AGA. “That would put an even greater financial burden on consumers.”
According to AGA, discouraging the production of America’s cleanest-burning, domestically abundant fossil fuel, which could tighten domestic supplies of natural gas, has broad implications, including the elimination of well-paying jobs and the serious potential for upward price swings.
“Right now, natural gas utilities are able to deliver clean, domestic natural gas to customers at reasonable prices,” Parker said. “With the economy in the doldrums, now is not the time to increase the price of natural gas to consumers.”
Because AGA’s members serve almost 93 percent of America’s natural gas customers, “AGA will oppose any provisions that ultimately result in higher monthly natural gas bills,” Parker said.