On Wednesday, the Ohio Senate passed Senate Resolution 176 which urges Congress to protect the natural gas and oil industry from disproportionate tax increases and other punitive measures. This resolution comes in direct response to the Biden Administration’s proposed $3.5 trillion budget reconciliation bill that seeks to dramatically increase taxes on the oil and natural gas industry.
Ohio’s abundant shale gas and oil resources have been transforming the domestic energy scene for the past several years. Not only is Ohio’s shale industry the fourth largest in the United States, but the Buckeye State is also home to major oil and natural gas company headquarters.
According to the U.S. Chamber of Commerce’s Global Energy Institute, natural gas makes up 43% of Ohio’s electricity mix, which allows our state to enjoy residential retail prices for 12.2 cents per kilowatt hour. This is roughly 6.7% below the national average. Federal policymakers must realize that by hampering our country’s domestic energy development, they are not only inflicting economic hardship at the national level; they are also obstructing Ohio’s energy renaissance.
The United States cannot afford to relinquish its hard-earned spot as the world’s largest producer of oil and natural gas, but this is exactly what is at risk with actions such as disproportionately increasing the tax burden on the industry or revoking energy infrastructure projects such as the Keystone XL’s pipeline. As a state particularly well-situated to benefit from several shale plays, Ohio is in a position to fuel a post-pandemic economic resurgence powered by affordable and reliable domestic sources of energy, with many of these benefits already flowing to Ohio’s communities and workforce. Ohio would be particularly devastated by any federal efforts to reduce or stop oil and gas extraction and transportation activities.
Over the past decade, the shale revolution has transformed the economy and reduced emissions. The Ohio Chamber will continue to ensure that state and federal tax policies on the oil and natural gas industry are sensible to promote future investment in our state.