The state of the electrical grid has dominated conversations, especially with historical winter storms wreaking havoc in past years. That concern continued to grow with oil and gas activity during the Biden presidency, but now, as President Trump pushes for increased production, those grid concerns have been illuminated. Already taxed, the domestic power grid has failed to muster confidence with the oil and gas industry increasing the already high demand. In an attempt to solve sustainability issues, American Petroleum Institute (API) and CEO Mike Sommers announced a multi policy solution.
Sommers recently addressed the Economic Club of Pittsburgh and focused on rising electricity demand due largely to the artificial intelligence (AI) boom of technology and development. Partnered with oil and gas demand as well as other high-end users, AI has put a serious strain on the nation’s electrical grid. In response, Sommers offered key points for the Trump administration and Congress to shore up the future of domestic energy.
“The scale of America’s energy need is breathtaking, and we have the opportunity to power that future,” said Summers at the club gathering. “The electricity AI will need is unprecedented. By one estimate, if we want to keep the bulk of AI on American soil, we’ll need to dedicate about 51 gigawatts just to data centers. That’s equal to 103 percent of all the generation capacity in Pennsylvania.”
After almost 20 years of the country’s power grid receiving little improvement, its reliability is questioned as power consumption is inevitable. Sommers pointed to an expected increase of 25 percent just over the next seven years. This points to the need for approximately 1,000 terawatt hours of additional power in less than ten years. While this additional power calculation equals the total power consumption made by Japan annually, the US produced less electricity in 2023 than in the five years prior.
“We have the opportunity to write the next chapter,” said Sommers. “To rebuild our failing infrastructure, we need sensible permitting reform. We need to greenlight LNG exports and process pending applications. We need to open up leasing, onshore and offshore, and ensure the American people’s federal lands and waters are working for them.”
Sommers drew upon his conclusions and emphasized President Trump’s energy strategy. To serve as a roadmap to success, he presented API’s Five Point Policy, which includes protecting consumer choice, bolstering geopolitical strengths, leveraging the country’s domestic resources, reforming the permitting process, and advancing a sensible tax policy. He added that while API’s plan could fortify domestic energy dominance, it added value with the ability to reduce inflation, another concerning fear held by many Americans.
According to API’s policy, increasing the consumer’s choice instead of forcing specific mandates like EV use offers a viable solution. Geopolitical strength can be achieved by approving pending permits and export applications while releasing American energy to the global market. Instead of impeding development, API indicates utilizing domestic resources will strengthen the industry.
A revitalization of the offshore industry offers a route to success. While reforming the offshore permitting process can jump-start activity, API points to an additional debottlenecking in the areas of the National Environmental Protection and Clean Water Acts. Sommers added that tax reform would catalyze the process. Retaining the 21 percent corporate tax rate would ensure global competitiveness while extending tax provisions could fortify investments in domestic infrastructure.
“Americans want our leaders to channel proactive, pioneer spirit that made us the greatest nation and economy in world history,” said Sommers. “A new American century needs American power. Let’s seize this moment, face our destiny, and unleash the energy America needs.”
Nick Vaccaro is a freelance writer and photographer. In addition to providing technical writing services, he is an HSE consultant in the oil and gas industry with twelve years of experience. Vaccaro also contributes to SHALE Oil and Gas Business Magazine, American Oil and Gas Investor, Oil and Gas Investor, Energies Magazine and Louisiana Sportsman Magazine. He has a BA in photojournalism from Loyola University and resides in the New Orleans area. Vaccaro can be reached at 985-966-0957 or [email protected].
