Action Item: The buzz has gone national about the Philadelphia Region becoming the next energy and feedstock hub, with the recent Energy Summit that hosted top business, government and labor leaders, investors, and thought leader attendees. The Region is blessed by its confluence of resources and powerful markets, as well as its strong transportation infrastructure, education, workforce, healthcare, capital and market resources, and land resources. Together, the Philadelphia Region offers a recipe for a juggernaut of job growth in the energy sector.
The buzz has gone national about the Philadelphia Region becoming the next energy and feedstock hub. On December 5, a landmark event in the history of the Philadelphia Region took place when Drexel University hosted the first top-level "Energy Summit": "Greater Philadelphia: The Next Energy Hub." Top business, government and labor leaders, investors, and thought leaders from our area and all over the nation and the world were here to discuss the embarrassment of riches our Region offers to become an energy and feedstock jobs juggernaut.
The event was conceived and designed by the Greater Philadelphia Energy Action Team ("GPEAT"), which was started by a group of us over one year ago as a catalyst for creating a national and global buzz about the opportunities our Region offers for responsible economic growth—opportunities of a magnitude never before seen in this area in our lifetime—and executing on them.
Pulitzer prize winning author and world-renowned energy expert and historian, Daniel Yergin, came to tip his hat to our Region's potential by being the keynote speaker. Mr. Yergin agrees that the Philadelphia Region has tremendous opportunity to be a new energy hub. Never before has the source of the energy resource stood in the same proximity as the demand centers, as we see now in our area. The unprecedented rich and productive resources are located a mere 100 miles away to the north and a few hundred miles away to the west. The Philadelphia area is located smack in the middle of the demand-rich Northeast corridor between New England and Washington, D.C.
Pennsylvania and the Northeast is not only no longer receiving its natural gas energy supplies from the Gulf Coast, but soon it will also no longer make any sense to ship those homegrown resources to the Gulf Coast for valorization and further processing into inputs for manufacturers. And that's where the real job growth potential is—in the valorization and processing of those resources into inputs for other businesses and manufacturing.
Add to that equation the other factors in play that make this Region blessed with an embarrassment of riches for economic development: (1) transportation; (2) education; (3) workforce; (4) health care; (5) capital and market resources; and (6) land resources.
The Philadelphia Region has an advanced transportation network of rail, interstate highways, and a deep-water port to receive and transport the energy and feedstock from the source to consumers. We have a tremendous network of institutions of higher learning, such as Drexel University and the University of Pennsylvania, among others. Drexel has long been renowned for its top-notch School of Engineering and its Co-op Program that provides ready and proven workforce experience to both students as well as local and global employers. Pat Eiding, the President of the Philadelphia Council, AFL-CIO, chimed in at the event with his take that the workforce in our Region is ready, willing, trained, and able. That evaluation was seconded by many present, including Phil Rinaldi, head of Philadelphia Energy Solutions, and Jeff Warmann, head of the Delta Airlines Monroe Refinery in Delaware County. Our Region also boasts a life science and healthcare network that is second to none in the nation, consisting of more than 15 major health care systems, 197 hospitals, four children's hospitals, six medical schools, and four National Cancer Institute-designated cancer treatment centers.
Our Region is already a major capital market center and has room to grow. Dan Fitzpatrick of Citizens Bank and Nalin Gupta, Vice President of Morgan Stanley, gave attendees a flavor for the Region's current capabilities and capacity for growth in that area.
The event attendees also heard about the Region's community and policy perspectives from a wide variety of speakers. Of note were the bipartisan and citizens' voices that are critical because building community and political support, as well as will, is key. On the federal side, Republican U.S. Congressman Pat Meehan from Delaware County, Pennsylvania, and Democratic U.S. Congressman-elect David Norcross from New Jersey, showed us how both sides of the aisle can work together for the workers and businesses of the Region. Of course, it was elected officials like Congressman Meehan and Philadelphia Congressman Bob Brady, along with numerous other federal, state, and local elected officials, who provided an example to the nation and the world with their cooperative efforts to bring new life to the Region's petrochemical refineries when, in 2012, all three announced that they were closing. On the municipal side, Blank Rome Partner Chris Lewis, who also serves as Chairman of the Philadelphia Energy Authority, emphasized the tremendous opportunity afforded to Philadelphians, particularly because 30 percent of the city's population is presently at or below the poverty level. The message: that number drops dramatically if the Region progresses on its current trajectory of being the next energy hub. Carol Collier, Senior Advisor for Watershed Management and Policy, Academy of Natural Sciences of Drexel University (and former Executive Director of the Delaware River Basin Commission), provided important insights as well.
John Grady, President of the Philadelphia Industrial Development Corporation ("PIDC"), headed a panel discussing the rich land resources of the Region. PIDC is the Region's public-private economic development engine. The bottom line is that our Region has a host of available ready sites for responsible development, including the Philadelphia Navy Yard and dozens of other shovel-ready sites. In addition, on the legal side, we have Pennsylvania's Act 2 Program, also known as the Land Recycling Program. That program, one of the first of its kind in the nation, and the model that other states aspire to emulate, is built on four pillars aimed at breaking down obstacles to redevelopment of former industrial sites: (1) a uniform environmental cleanup standard providing certainty up front to developers; (2) liability relief and protection to future owners; (3) timeline certainty by providing standard reviews and timelines for reviews; and (4) financial assistance in the form of grants and low-interest loans for new developers and owners who did not cause the environmental issues being addressed.
While some might think that development of an energy hub is contrary to a renewable or a "green" Philadelphia, that is an overly narrow and shortsighted view. In fact, the increased use of natural gas has allowed our country to substantially reduce its carbon footprint. Also, the energy hub opportunity is a broad tent that includes, for example, the opportunity for increased development of energy efficient and resilient commercial and even residential micro-grids via the increased use of Combined Heat and Power ("CHP"). Everyone present and who has an interest in the energy hub development acknowledges and is committed to its development in a responsible and environmentally sensitive fashion.
The fact is that the Philadelphia Region Energy Hub renaissance has already started and it's gaining traction. We have already written about the Sunoco Logistics Mariner East Project that will bring natural gas liquids, including much needed winter propane, to local markets. The former Marcus Hook Refinery, now the Marcus Hook Industrial Complex, is already providing new jobs and will provide many more as its development continues. Philadelphia Energy Solutions' Philadelphia Point Breeze and Girard Point refineries and Monroe Energy's Trainer, Delaware County refinery are humming and are providing thousands of jobs that just two years ago looked to be extinct and, along with them, a critical part of the nation's critical oil refining capability. Braskem, the Brazilian petrochemical company that located here in 2010, was also faced with extinction and had the refineries closed, but now is growing its supply chain here. There are many others involved in this collective venture. The smart business leaders behind those operations testified to the attributes of the Region. They are all parts of our community and they are very glad they came here. So too are the tens of thousands of supply chain workers who directly and indirectly service those operations.
The bottom line is that our Region's future is bright for generations to come, but only if we make the right decisions. We are uniquely poised here to have both environmentally responsible development and hundreds of thousands of new jobs for our citizens spanning generations. If Ben Franklin were asked whether we have an energy hub or is that opportunity going elsewhere he would undoubtedly say, "an energy hub, if you can keep it."
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