Copyright © 2001 The International Herald Tribune | www.iht.com
U.S. Needs Reality Check on Energy
Reginald Dale
International Herald Tribune
Tuesday, May 8, 2001

WASHINGTON - With gasoline costing over $2 a gallon in Chicago, and California bracing for waves of rolling blackouts this summer, the polls show that energy policy has shot to the top of Americans' concerns. It is also a high priority for the Bush administration, which is due to publish a comprehensive, long-term energy plan, drawn up by a task force headed by Vice President Dick Cheney, in the coming days.

But while administration officials constantly stress the need to tackle the country's "energy crisis," Mr. Cheney's plan will not provide instant relief. "Our short-term energy problems are likely to get worse before they get better," says Lawrence Lindsey, President George W. Bush's chief economic adviser.

What many government and private energy specialists hope is that the plan will start a lengthy process of educating the American public in the stark realities of energy supply that have been forgotten or ignored during the policy vacuum of recent years.

Too many Americans seem to think that electricity "comes out of a plug in the wall," with no need for power stations or transmission cables, Mr. Lindsey says. Changing public attitudes will be a slow and hugely difficult task. Mr. Bush's critics are already attacking him for seeking to destroy a vast, pristine wilderness by drilling in the Arctic National Wildife Refuge and for favoring increased fuel supplies over conservation.

These attacks are often ideological. In fact, the administration says, drilling operations in the Arctic reserve would leave a minute "footprint" in a huge area. Ideological divisions are likely to grow even greater as the administration's longer-term plans become clearer. Many Democrats and environmentalists want to increase the government's role in setting energy policy through regulation, mandatory conservation and higher public spending to promote energy efficiency.

Mr. Bush's advisers, on the contrary, believe in markets. They argue that economic growth will lead to technological advance and thus to more energy efficiency and innovative ways of curbing pollution. If people are made to pay the full economic cost of fuel, they will want to conserve energy voluntarily - which is already happening as high gasoline prices prompt many Americans to drive less.

The coming clashes will be even more virulent in that a more assertive energy policy will inevitably lead to a head-on confrontation with environmentalists, who have largely succeeded in blocking the expansion of the U.S. energy infrastructure over the past decade and more - in itself one of the main causes of the energy crisis.

Without necessarily spelling out all the implications, the Cheney report will mark the beginning of the most radical changes in U.S. energy policy since the oil shocks of the 1970s, according to people both inside and outside the administration.

A prime objective will be to help relieve supply bottlenecks by building power stations at a rate of more than one a week for the next 20 years, as well as thousands of miles of pipelines and high-tension wires.

But, with the United States now dependent on imported oil for well over 50 percent of its needs, the aim is also to enhance energy independence by increasing domestic production and ensuring that imports come from friendly countries.

One probable outcome, says Paul Michael Wihbey of the Institute for Advanced Strategic and Political Studies, is the creation of a North American energy grid including Canada and Mexico, to be followed by greater energy integration with South America and more imports from western Africa.

"We may be seeing a restructuring of the global oil market as a result of which, for the foreseeable future, the United States could rely for foreign sources of oil on friendly suppliers with no history of anti-Americanism or terrorism," Mr. Wihbey said.

Behind all this lies an even more controversial "sleeper," the revival of nuclear power, according to Daniel Yergin of Cambridge Energy Research Associates. "If you are serious about global warming you have to look at nuclear power, even if nobody has said so very loudly in the United States," he said.

That view is shared by Mr. Bush's advisers. It makes obvious sense. Funnily enough, by helping to push up energy prices with their demands for excessive regulation, environmentalists may have paved the way for nuclear power's return.
 


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