Although the U.S. Department of Energy is much more industry friendly than it was in its early years, when its mission partly was to enforce petroleum price and allocation rules, it now is a candidate for extinction.
The new Republican majority in Congress is mulling proposals to reduce the number of cabinet departments and shift their functions to other agencies.
Separately, the Clinton White House has its program to downsize and streamline the government. It is considering splitting DOE's functions among the Defense, Commerce, and Interior departments.
The Reagan administration considered the same option in 1981 but dropped it after the Congressional Budget Office said little money would be saved.
The majority of DOE's activities always have been the manufacture or disposal of nuclear waste, a defense industry function.
The Transportation Department and Department of Housing and Urban Development also are candidates for dismemberment.
OPPOSING VIEWS
Industry leaders are split on their views of the value of DOE.
Charles DiBona, American Petroleum Institute president, would not be sorry to see the department go.
He said, "This is my personal view, not the association's. But when you look at issues most important to the petroleum industry, they are issues controlled by the Environmental Protection Agency, access to lands issues controlled by the Interior Department, and tax actions controlled by Treasury.
"I assume that the Federal Energy Regulatory Commission, which is an independent DOE agency, would remain.
"But all DOE has been doing lately, it seems to me, is focusing on nuclear issues and promoting a very foolish thing, alternative fuels."
American Gas Association Chairman Robert Catell, who also is chairman and CEO of Brooklyn Union Gas Co., New York, argued against breaking up DOE.
He said the department has been stressing natural gas use and is needed as long as the U.S. imports the bulk of its oil consumption.
"It's very important for there to be a policy position somewhere in government that is focusing on energy," Catell said. "We won't want to lose that focus."
Copyright 1994 Oil & Gas Journal. All Rights Reserved.
