Yet another advisory board was launched in Washington last week, this one to advise Energy Sec. James Watkins on all aspects of energy development.
At first the 28 member Secretary of Energy Advisory Board will review DOE's interim National Energy Strategy and examine ways to sustain DOE's national laboratories.
Thomas Everhart, president of the California Institute of Technology, chairs the board, which includes Richard Stegemeier, chairman, CEO, and president of Unocal Corp., and Kenneth Lay, chairman and CEO of Enron Corp.
HOT ISSUES
At the board's first meeting, a subgroup examining future energy supplies offered Watkins some political hot potatoes such as limiting oil imports and increasing gasoline taxes.
John Landis, a senior vice-president of Stone & Webster Engineering Corp., Boston, said the subgroup agrees the government must act or the nation may not have enough energy supply in the future, but whatever it does, the price of energy is certain to rise.
The subgroup reported there is no reasonable way to separate energy supplies and environmental protection and recommended the government establish an aggressive program to educate the public about energy supplies and environmental protection.
It said, "The price of energy today is too low in the U.S. It does not reflect real costs. The nation's dependence on foreign sources of oil must be kept below a threshold level determined by a balance among cost, national security, and international relations issues."
The subgroup said the U.S. should focus on exploiting domestically abundant fuels-coal, natural gas, and uranium, for example-and immediately improve conservation.
In follow up discussions, Stegemeier said the U.S. needs higher gasoline prices to encourage conservation, reduce pollution, and lower oil imports.
He said, "Gasoline is the cheapest liquid we can buy in America today, at 65/gal before taxes. It's a commodity that is so cheap people won't conserve it."
He said people may pay lip service to conservation and environmental protection, but price is the one mechanism people understand. Alcohol fuels are no solution because all the grain production in the country, if converted to alcohol, would equal only 10% of gasoline consumption.
Bill Fisher, director of the University of Texas' bureau of economic geology, argued the U.S. should set a cap on oil imports. Without such a threshold, he said, the nation will continue to put off action on tough energy issues.
A SELF-INFLICTED WOUND
Watkins voiced his frustration with those who block energy projects on environmental grounds yet demand adequate supplies.
In particular, he noted the New England states have not allowed construction of a refinery that would ensure a local supply of petroleum products but have asked DOE to establish a regional strategic products reserve there.
If the Northeast has a products supply problem during shortfalls, Watkins said, "it is the result of a self-inflicted wound."
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