WATCHING WASHINGTON BALANCING THE NES

With Patrick Crow This week the Bush administration is expected to release a remarkable National Energy Strategy-remarkable not for its contents but for its omissions. A draft of the NES legislative proposals was leaked last week in Washington. It called for leasing of the Arctic National Wildlife Refuge Coastal Plain and the Elk Hills, Calif., Naval Petroleum Reserve, oil pipeline decontrol, and relaxed gas pipeline regulation (see story, p. 36).

Feb. 18, 1991

3 min read

This week the Bush administration is expected to release a remarkable National Energy Strategy-remarkable not for its contents but for its omissions.

A draft of the NES legislative proposals was leaked last week in Washington. It called for leasing of the Arctic National Wildlife Refuge Coastal Plain and the Elk Hills, Calif., Naval Petroleum Reserve, oil pipeline decontrol, and relaxed gas pipeline regulation (see story, p. 36).

It contained no hint of a strategy. That may come in the rest of the NES with its analyses, projections, and recommendations for federal and state administrative actions.

LEGISLATION THE KEY

Legislation is the backbone of energy policy, and the Bush proposals are mostly legislative leftovers. Previous congresses declined to lease ANWR, sell Elk Hills, or decontrol oil lines.

Production oriented proposals may be commendable, but they are not enough. Congress is unlikely to approve them unless they are balanced against programs for conservation and alternative fuels and other steps to lower oil imports.

DOE had raised expectations that NES, the product of 18 months of work, would be more than retreaded bills. Energy Sec. James Watkins had pledged the NES wouldn't be just another set of lofty energy goals but a roadmap of how to reach them in a set period of time.

DOE's initial proposals may have balanced production and conservation better. But the White House was asked to make about 65 policy decisions and apparently rejected anything that was not free market oriented.

"That shows when you ask a politician to make a decision you get a political decision," said a Washington lobbyist.

What was left was a strategy that largely focuses on ANWR leasing and lacking the detail or innovation of competing Senate and House bills.

That's unfortunate. Sending an ineffectual proposal to Congress will deprive DOE of a rare opportunity to set in place an energy plan worthy of the name.

Now Congress has the initiative. It may well pass energy legislation this session, but it will be a hodgepodge, not a strategy. And it likely will contain more conservation and renewable energy provisions than preproduction measures.

"MISGUIDED PROVISIONS"

The Independent Petroleum Association of America complained even the preproduction provisions are misguided.

IPAA Pres. Denise Bode said, "The NES completely misses our surest, environmentally safest production opportunities. They say this plan focuses on production. But there is nothing meaningful in the plan to encourage domestic independent oil and gas production."

She said the strategy "forgets the basics to bet everything on exotics like offshore and ANWR," ignoring better opportunities to increase Lower 48 oil production. Bode said the NES should have worked to eliminate regulatory barriers to gas use and tax penalties on investment in domestic oil and gas production.

"Finally," she said, "it needs to recognize the need for a stable floor for oil prices in order to start building production and reserves. Domestic production will come back according to its profitability and the availability of investment capital."