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Almost everyone will agree on the
need for energy efficiency. Whether a Democrat or
a Republican, a captain of industry or a staunch environmentalist;
the benefits of forming national energy policies based on efficiencies
are clear—or are they?
Now in its 12th year, the Energy Efficiency Forum sponsored by the
U.S. Energy Association (USEA) and Johnson Controls, Inc., Milwaukee,
WI, sought to bring together divergent views on energy efficiency,
environmental impacts and economic growth within the context of
the Bush administration’s redefined energy plan. With a speakers
list drawing from both sides of the aisle—and the issues—numerous
positions were presented and everyone found something to cheer
or renounce.
The featured speaker of the event was Vice President Dick Cheney.
Although not universally applauded—yes, there was a heckler—as
chair of the White House National Energy Policy Development Group,
no other speaker could have been more appropriate to address the
standing-room-only crowd. He began by characterizing the current
energy challenges as a “potential storm cloud on the nation’s
economy” and frequently referenced his committee’s recently
released report that contains more than 100 recommendations aimed
at addressing specific areas of concern. It proposes, he said, a
balanced approach in dealing with our aging power grid by increasing
energy supplies from diverse sources and by promoting good stewardship
of the air, water and land, using recent advances in technology
that allow the production of more energy
and, at the same time, promote a cleaner environment.
Contradicting his earlier assertions of a bleak energy record, the
vice president noted the nation’s remarkable progress in energy
efficiency, citing advances in refrigerators, fluorescent lighting
and automobiles. “Since the Nixon administration, the economy
has grown by 126 percent while our use of energy has grown by only
26 percent,” he reported. He also touted government programs
such as Energy Star, and he complimented the federal government
on efficiencies achieved throughout the 1990s in its buildings,
vehicles and agencies, vowing to continue to improve on this excellent
past performance.
Cheney did not shy away from addressing controversial issues such
as global warming and the Kyoto Protocol when they were raised during
the Q&A session. Obviously well prepared to debate the science
of the case, he impressed the audience with statistics on the temperature
of the planet’s surface over the last 100 years. He also reiterated
the administration’s interest in promoting renewed reliance
on nuclear power as a solution to reducing our dependence on fossil
fuels and the problems associated with their carbon dioxide emissions.
Earlier in the program, Democratic Congressman Ed Markey of Massachusetts
presented a completely different view of energy efficiency. To illustrate
his opinion of the Bush administration’s energy policies, Markey
used the example of the “way back machine” from “The
Rocky and Bullwinkle Show,” a favorite of his as a young boy.
He accused the president of trying to implement an issue agenda
of 25 years ago to deal with a non-existent energy crisis. Despite
the recent California electricity problems, Markey insists that
the “crisis” is very localized and is the result of some
bad laws, some bad weather and not a shortage of energy supplies.
He feels that the solutions will be found in “working smarter,
not harder.” This means improving automobile gasoline efficiency,
not drilling in the National Artic Wildlife Refuge so that we can
build pipelines to bring oil to California to put it into SUVs that
get 14 miles to a gallon.
Markey chided the administration, often sarcastically, for many
of its actions. For example, a short time ago the Clinton administration
promulgated the final set of regulations pursuant to the Markey
Appliance Efficiency Act of 1987, which called for a 30 percent
increase in the efficiency of air conditioners. Despite the fact
that the second largest producer of air conditioners in the U.S.
is already meeting the proposed standard, the Bush administration
decided that it would be too onerous a burden on the industry at
large to impose a standard in the middle of a “national energy
crisis.”
Markey questioned the moral and ethical consequences of despoiling
pristine lands that should be preserved for future generations because
we don’t want SUVs to average 25 miles-per-gallon or air conditioners
to improve their efficiency by 30 percent. He believes that working
smarter means a heavier reliance on our technological achievements,
as well as the creation of tax incentives and credits to provide
incentive for energy efficiency.
Although Markey’s remarks were interrupted often by laughter
from a highly like-minded crowd, other speakers were well, if not
as jovially, received. Senator Jeff Bingaman, a Democrat from New
Mexico and the new chairman of the Senate Energy and Natural Resources
Committee, started things rolling by agreeing with President Bush
that this is, or certainly should be, a bipartisan issue. However,
he chided the administration for its non-inclusive process in putting
together its energy plan. His committee, he indicated, would work
closely with its Republican members in fashioning a two-tier solution:
address the short-term issues to the extent they can be through
legislation—issues like the low income home energy assistance
program and the state energy conservation programs—and
then would go to work, in earnest, on long-term legislation.
Bingaman concedes that there are a large number of complex issues
requiring attention, and he is anxious to hear the administration’s
plans in more detail than were presented in the report. At the top
of his list is how to improve fuel efficiency in vehicles, a highly-charged
political matter, but one the senator believes is crucial given
the extent of our dependence on foreign oil and the roughly 60 percent
of it that goes into vehicle transportation. Part of the solution,
he believes, is increasing federal funding support for new technologies
rather than cutting back, as proposed by the administration. He
thinks Congress should deal with energy-related tax incentives even
though the recent large tax cut has committed the funding elsewhere.
To conclude, Bingaman strongly advised that our nation’s energy
plan and any legislation must be put together with an eye toward
global climate change. He ended on a hopeful note by professing
that he believes that the “stars are correctly aligned”
for Congress and the administration to actually do something significant
this year.
Representing the automobile industry was Dennis Minano, General
Motors’ (GM) vice president of energy and environment and chief
environmental officer. He acknowledged both the importance of the
White House National Energy Plan to GM and its support, noting that
it takes “a comprehensive and balanced approach to the demand
for and supply of energy; one that makes sense.” The report,
he said, presents a number of fundamental premises with which GM
concurs: a belief in environmental stewardship; an integrated approach
to environmental, economic and energy issues; support for the idea
that technology will ultimately solve many of the problems we face;
and the importance of partnerships between private industry and
the government.
Minano was critical of the government’s fuel economy legislation
since 1975, emphasizing that the U.S.’s reliance on imported
oil has grown even though the fuel economy of cars and trucks has
more than doubled. In his opinion, it is clear that mandates like
CAFE (Corporate Average Fuel Economy) have not solved the petroleum
conservation problems.
GM has outlined a list of other solutions, beginning with the belief
that they can eventually build commercially viable fuel cell vehicles
powered by hydrogen. There are major challenges that need to be
overcome and, until then, some interim solutions include hybrid
vehicles, modern diesel engines, continuously variable transmissions,
displacement on demand technology and mass transit. GM has already
begun producing hybrid buses and will soon begin introducing hybrid
pick-up trucks and SUVs. GM is obviously relying heavily on innovative
technology and, as Minano says, is applying it across the board—to
manufacturing, land use, energy development, emissions, fuels, power
trains, vehicle design, conservation and infrastructure.
In closing, Minano reiterated an oft-repeated theme—the importance
of cooperation and collaboration between industry and government.
“We must all,” he said, “stretch to achieve the best
rather than impose limits on the possibilities.”
The remaining speakers addressed similar themes. Curt Hébert,
Jr., chairman of the Federal Energy Regulatory Commission and enjoying
support from both the Clinton and Bush administrations, was temperate
in his remarks, admitting to the complexity of the issues and using
poll results to support his views and the actions of his agency.
His price mitigation plan, he explained, is based on market solutions
and market mechanisms; and it is working, at least thus far, to
control the cost of energy.
Andrew Natsios, administrator for the U.S. Agency for International
Development (USAID), approached the issues from a different perspective.
The world economy, he said, is trying to deal with twin trends going
on simultaneously. One is globalization, which is tying the whole
international economy together. At the same time, there is a huge
increase in the number of failed states and collapsed governments.
Economic growth is the key to stabilizing these fragile nations;
yet such growth is impossible without energy—to light homes
and classrooms, pump water, make bread, listen to radios, learn
on computers, refrigerate medicines and, of course, enable transportation.
The USAID is therefore putting programs into place to provide developing
countries access to world-class commercial technology and management
practices, while at the same time helping U.S. industry become more
competitive in the international marketplace.
Llewellyn King, publisher of Energy Daily, moderated a panel representing
many divergent views that were most clearly expressed in response
to the question, “What did you like and dislike in the vice
president’s energy plan?”
Branko Terzic, the director of Public Utilities Services for Deloitte
& Touche, approved of the proposals for more drilling, using
technology to achieve better efficiencies and mitigating environmental
concerns. David Nemtzow, with the Alliance to Save Energy, liked
the focus of national attention on tax credits for hybrid cars as
well as expansion of the Energy Star program. He criticized the
plan, though, for its failure to reverse two key mistakes of this
administration—the budget cuts and the air-conditioning rollback,
as well as its insufficient attention to
fuel economy. Mark Whitenton, vice president for resources, environment
and regulation with the National Association of Manufacturers, agreed
with Nemtzow on many issues, but overall liked the plan a great
deal.
These individuals, as well as many of the speakers, openly discussed
the government’s CAFE standards, debating whether they have
served the public well or have imposed undue hardships on industry.
As was the case with almost all the issues raised at this forum,
there was strong, yet respectful disagreement, making it very clear
that open discussions such as this one need to be available.
USEA and Johnson Controls, Inc. are to be commended for their willingness
to continue to present this annual bipartisan event. One can only
wonder what the next year holds for this complex and crucial debate.
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