Paula Dittrick
OGJ Online
HOUSTON, May 17 -- Economist Philip Verleger called the White House energy policy "timid" Thursday, while two other energy consultants said President George W. Bush was "realistic" with his long-term approach.
Petroleum Industry Research Foundation Pres. Larry Goldstein told OGJ Online, "There are no political magic wands that they can wave and fix this overnight. ... They are going to deal with structural issues longer term."
Goldstein said he saw both "balance and diversity" reflected in the proposals, adding, "We need to continue to see improvement in energy efficiency."
He predicted "pieces" of the energy crunch, such as advancements in clean coal technology, could be resolved in 3-5 years while many problems will take a generation to resolve.
"It's at least 10 years before we see any measurable contribution from alternative fuels," Goldstein said.
Emphasis on power
Dan Pickering, head of research for Simmons & Co. International, Houston, was encouraged that most of the initiatives were longer term, adding he saw a "surprisingly strong emphasis on nuclear and coal. ... I think we saw a fairly significant emphasis on power."
"Out of 105 recommendations, only 12 can be directly implemented by the office of the president. The rest are going to have to go through Congress and committees," Pickering said.
Pickering agreed there are no short-term solutions. "It took a long time for these problems to develop and it's going to take a relatively long time for conservation and initiatives to have an impact."
Bush demonstrated the seriousness of his near-term concerns by instructing the Federal Emergency Management Agency to initiate emergency planning for any energy-related shortage, Pickering said.
But Verleger, of PKVerleger LLC and the Brattle Group, said, "It's such a timid policy," adding he believed Bush should have more directly addressed electricity decontrol.
"If he wants free trade in everything else, he is going to have to accept free trade in energy," Verleger said.
Verleger said he reviewed the energy-related records of former presidents Jimmy Carter, Gerald Ford, and Richard Nixon in anticipation of Bush's announcement.
"It's not much of an energy crisis," Verleger said, comparing the situation to 1973 and 1979.
ANWR
Pickering said the White House has tried to link opening of the Arctic National Wildlife Refuge coastal plain to green policies by proposing ANWR bonuses and royalties be used to fund land conservation efforts.
"That was new. I had not expected that," Pickering said. "I think ANWR is very visible in Bush's comments. "I think it's a tough sell. It's definitely several years down the road."
Goldstein said Bush has set the stage for serious debate on issues such as ANWR and nuclear power.
"This year is the year for honest debate on ANWR," Goldstein said, adding a decision might come in 2002 or 2003. "That way, ANWR could still make a sizable contribution by 2010."
Regarding nuclear power, Goldstein said he believes the issue will not be new nuclear plants but rather whether to relicense existing nuclear plants with good safety and environmental records.
"The administration needs to put the issue of nuclear on the table," Goldstein said. "We need a portfolio approach," involving all types of energy to resolve both supply and demand issues, he said.
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