Energy policy that can deliver

As oil prices hit $55 per barrel and set records, and analysts forecast an even higher spike to $60 soon, the lack of an effective, long-term energy policy is an increasingly costly problem for the U.S. economy and national security. But this situation is equally an opportunity if we act responsibly, unleashing American ingenuity to set a new direction for our nation and the world.

We need a purposeful, strategic energy policy that will address three great challenges:

(1) The danger to political and economic security posed by the world’s dependence on oil.

(2) The risk to the global environment from climate change, caused primarily by fossil fuel combustion.

(3) Finally, the lack of access by the world’s poor to modern energy services, agricultural opportunities, and other basics needed for economic advancement.

By addressing these challenges, new energy industries will emerge, with an explosion of new jobs and economic growth.

Work must begin in the United States, the world’s largest energy consumer. Public and private leadership is needed to put together the technological innovation and political will to transform how we produce and use energy. Through our leadership, we can help the global community do the same.

Our energy policy must start by addressing our transportation sector’s reliance on oil: Two-thirds of the oil Americans consume goes into the tanks of their cars, trucks, and buses.

We can progress enormously by promoting development and manufacture of advanced vehicles. Hybrid cars that run on gasoline and electricity generated by braking are already in the marketplace. But, unfortunately, U.S. automakers are behind their Japanese counterparts in seizing this market, and 1 in 7 American jobs is tied to the auto industry. America needs to help its manufacturing plants retool to produce hybrid vehicles, and provide U.S. consumers a significant purchase incentive.

Clean alternative fuels, produced in the United States, must also be part of the solution. We can encourage increased development of farm-based fuels like ethanol and biodiesel. New technologies promise to cut their costs and increase production. This would reduce U.S. energy dependence, cut greenhouse gas emissions, give farmers new economic opportunities and stem the costly, counterproductive flow of agricultural subsidies.

Renewable fuels and wind power can create jobs and save consumers money. A recent study by the Union of Concerned Scientists found getting 20 percent of our power from renewable sources would reduce natural gas demand, cut natural gas and electricity prices and save consumers $49 billion by 2020. It also would create more than 355,000 jobs in manufacturing, construction, operations, maintenance and other fields, nearly double the number gained from generating the same amount of electricity from fossil fuels.

Coal will remain a major part of our energy diet for the foreseeable future because it is cheap and widely available. Unfortunately, it is very polluting. However, technologies that capture and sequester carbon dioxide emissions can transform the coal industry’s future. Hydrogen is a by-product of these technologies, and that could be used for fuel cells. An energy policy must embrace developing and using these technologies.

Modernizing the power grid that supplies electricity to homes and workplaces can save enormous amounts of energy. We saw how antiquated, fragile and inefficient this network is in the August 2003 power outage. Unfortunately, little has been done since. Introducing microprocessor technologies, rewiring the grid with advanced computer controls, and enabling the grid to heal itself in a disruption are additional, much-needed steps.

Finally, we must recognize success of our national energy policy is tied to global energy development. The advent of globalization, the growing gap between rich and poor, the war on terrorism and the need to safeguard the Earth’s environment are all intertwined with energy concerns. National security depends on energy security.

Worldwide energy use is projected to triple by 2050, as China, India and other developing nations sharply increase output. Innovative financing is needed to reduce the private sector risk and mobilize investment in energy development.

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