- The Washington Times - Thursday, April 5, 2001

Energy shortages loom like a cloud over the U.S. economy and should be addressed both with efforts to conserve and the development of new energy sources, Federal Reserve Chairman Alan Greenspan said yesterday.

"I can't say that we have a crisis," he said, but energy shortages have "emerged as a very significant question" that will "impact on our attention quite vividly for quite a good number of quarters in front of us and, perhaps, a number of years," he told the Senate Finance Committee.

The nation's shortage of natural gas to heat homes and fuel power plants is particularly acute, he said, and must be addressed primarily by drilling domestically.

The only alternative importing liquefied natural gas "is a very difficult thing to do and requires very major changes in the infrastructure for import facilities in the United States," he said.

Mr. Greenspan's remarks appeared to support the energy strategy of President Bush and Republicans in Congress, who put top priority on drilling in Alaska and elsewhere domestically to increase supplies of oil and gas. He made them in response to a question from Senate Energy Committee Chairman Frank H. Murkowski, Alaska Republican.

But the Fed chairman said that energy conservation "clearly must be on the table" because of the threat of immediate power shortages in California and New York. He suggested "metering electric use to a very much greater extent than we do" as one way to reduce consumption.

The country not only must build more power plants, he said, but it must decide how to fuel them with coal, nuclear or other energy sources.

The Fed chairman noted that the energy crunch emerged, despite a decreased reliance on energy in recent years, as a result of the economy's evolution toward high technology and away from its traditional industrial base.

"We still have very large energy requirements in this country," he said, with "obvious shortfalls on the supply side."


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