Winter officially begins next week and New England finds itself disturbingly ill‐prepared with limited supplies of fuel oil and restricted access to domestic natural gas. That an area of the country known for its bone‐ chilling temperatures finds itself in this predicament is due to a range of factors including sanctions on Russian energy, refinery closures, and insufficient pipeline capacity. None of that is likely to change anytime soon, and even if new refineries or pipelines were greenlighted their construction would come far too late to alleviate New England’s energy woes in the coming months. But that doesn’t mean policymakers are bereft of options. To encourage the transport of fuel to the region and reduce the possibility of a wintertime calamity Congress should act to exempt energy shipments from the outdated Jones Act. Passed in 1920, the Jones Act restricts domestic shipping to vessels that are U.S.-flagged, built, owned, and crewed. But such ships are significantly more costly to build and operate than their international counterparts. They’re few in number too. Of the thousands of tanker ships that ply the high seas the U.S. Maritime Administration lists just 56 that comply with the law, only a subset of which can move fuel to New England (eleven of the 56 are large tankers designed for the transportation of Alaskan crude oil, one is dedicated to transporting molten sulfur, one was recently chartered by the U.S. military making it unavailable for commercial use, and another has been scrapped). The added expense and difficulty of utilizing such vessels has such distorting effects that it can make more sense to ship U.S. fuels abroad than to other parts of the United States.
Click for Full Text!
