Vote Yes for the Energy Bill, Then Start Working on the Real Issues

Gregg Easterbrook
Gregg Easterbrook Contributing Editor, The Atlantic, Visiting Fellow (2000-08), Brookings Institution, Author, Arrow of History (forthcoming, 2018)

July 28, 2005

If I were a member of Congress, I too would have voted for the energy bill that has just passed in the House today. However, having voted aye, I would start hearings on a new energy bill as soon as Congress returns in September — because the four-years-in-the-making legislation studiously avoids the most important questions of energy policy today.

What America needs is an Energy Future Act. But what we’re getting is the Energy Status Quo Act.

I’d vote for the current bill because the proposal contains many useful provisions. It will make it easier to construct new nuclear power plants, and the nation needs more atomic power, especially as the scientific case for artificial global warming grows ever-stronger. (Atomic generators produce electricity without greenhouse gas emissions.)

The bill will make it easier to build terminals for the import of liquid natural gas, and the country needs an increased supply of natural gas. Importing gas in its liquid form is safe and needn’t be feared, but no one wants the handling facilities nearby; the bill will make it possible to choose locations for new terminals.

The bill will slightly encourage use of green energy sources such as wind and solar for electricity generation, and a slight improvement is better than no improvement at all.

And it is choke with technical provisions that will favor increased production of fossil energy in the United States. No matter how much we may wish for the end of the fossil-fuel era, in the short term, at least, the country simply needs more of the stuff.

Yet while the energy bill helps in some areas, it does little to tackle essential challenges such as petroleum conservation and the specter of an artificial greenhouse effect. Utterly missing from the legislation, for example, is any provision to improve the fuel economy of cars, pickup trucks and SUVs. Higher gasoline mileage standards are the most-needed reform in U.S. energy policy today, since adding vehicles to the road without addressing fuel efficiency has become the primary reason our petroleum imports keep going up.

The National Academy of Sciences said in 2001 that a roughly one-third increase in the miles–per-gallon (MPG) of new cars, pickup trucks and SUVs could be achieved using current technology, and without sacrifice of safety or comfort. If all new cars, pickup trucks and SUVs had roughly one-third higher fuel economy, it would take less than 10 years’ worth of new-vehicle sales to displace petroleum consumption equal to the amount the United States currently imports from Persian Gulf dictatorships.

This would be fabulous for U.S. national security, while reducing total global greenhouse gas emissions and reducing the amount of dollars that flow to the oil sheiks who fund terrorism. Yet presidents of both parties have practically stood on their heads to avoid doing anything about gasoline waste, especially by SUVs and the misnamed “light” pickup trucks. The new energy bill follows this tradition, doing nothing about MPG.

In truth, there’s no reason the United States should not import lots of petroleum, especially if other nations can produce it more cheaply. Our leading oil suppliers are not Saudi Arabia and Kuwait but Canada and Mexico, with whom energy trade is reliable, even desirable. But the one-fifth or so of foreign oil that comes from Gulf State dictatorships entangles us militarily and politically with tyrants, costs us billions of dollars in military spending in the Gulf, funnels money to fanatic sheiks and undercuts our claims to favor broad global expansion of democracy.

All realistic scenarios for the next few decades show the United States importing most of its petroleum, and there is no reason the country should not. But a big reduction in the share of petroleum from the Gulf States would be a huge improvement in energy policy, and an increase in new-vehicle MPG could make this possible. Yet the energy bill does nothing about the gas guzzlers that increasingly proliferate on U.S. roads.

Also missing from the energy bill is the second-most-needed improvement to United States energy policy, assurance of a pipeline to carry natural gas from the Alaska North Slope fields to the lower 48 states — which has nothing to do with the more familiar (and controversial) question of whether to drill in the Arctic National Wildlife Refuge.

Natural gas wholesale prices have almost doubled since Congress began to work on the current energy bill, in 2001. But while the wholesale price of oil gets lots of media and political attention, the wholesale price of natural gas gets almost none — yet the increase has been sharper and more troubling in the gas sector. Supplies are also tight, which currently harms petrochemical manufacturers that rely on natural gas as a raw material, and which could harm homeowners as early as next winter.

Vast volumes of natural gas are now sitting in the North Slope oil fields, the part of Alaska that is already open to energy development. Yet the energy bill basically does nothing to insure that negotiations for a pipeline, now ongoing between Alaska state government and some energy-company consortiums will succeed. The bill only requires that the Department of Energy report every six months on how the Alaska pipeline negotiations are proceeding. That’s pretty weak tea.

Meanwhile critics are complaining that the energy bill contains too many tax breaks for the oil industry, a mature business that’s rolling in profits and has no claim on the federal taxpayer. This complaint carries weight. In the give and take over the shape of the final bill, these tax breaks were increased while a corporate favor that ought to be there, liability waivers for the petrochemical companies that made an antipollutant called MTBE, was dropped.

The history here is instructive. In 1990, Congress required refiners to add substances that would reduce the smog-forming effect of gasoline. Initially most refiners used MTBE for this purpose, and the substance was a success — smog levels declined in almost every American city in during the 1990s. Then it turned out that MTBE seeped into groundwater in some parts of the country, and though there’s no proof this imperils health, obviously we should not take chances with drinking water. (Public health studies might eventually find MTBE harmful, but this has not happened yet.) In recent years, MTBE has been replaced with other antipollution compounds.

This leaves the problem of groundwater, much of it California that shows traces of MTBE. Last summer’s version of the energy bill collapsed because it contained a provision forbidding tort suits against the companies that made the chemical. A similar provision was originally included in this year’s bill, and then dropped to help assure votes for final passage.

The common-sense solution — have MTBE manufacturers donate to a cleanup fund, so the money goes to cleanup rather than attorneys’ fees — is missing from the energy bill. In fact, a lot of common sense is missing from the energy bill. So members of Congress should vote for it, then start work on more courageous, forward-thinking legislation that tackles the issues this one dodges. Oh, and did I mention global warming? Totally dodged as well, and it may not be long until that question drives all energy-policy planning.