September 17, 2008

ACTION ON ENERGY--NOW

by Idaho Senator Mike Crapo

Since June, I've been submitting letters to the Congressional Record from Idahoans who have written to me about how energy prices are affecting their lives. I update my website with new submissions every day that the Senate is in session. Not surprisingly, the deleterious effects of increased fuel costs over the long run are challenging people in many ways as they adjust their daily priorities to accommodate budget constraints. And, with the complexity of the fuel supply chain from extraction, through production to delivery, the answers are not easy, nor are the problems quickly solved. This is no reason for inaction; in fact, we must take action so that we can see our way to the end of this energy crisis.

The complexity of the issue lends itself to a variety of innovative solutions. It's becoming increasingly cost effective for companies, large and small, to research and develop alternative energy that yields lower economic and environmental costs-and they are doing just that. The Idaho biofuel industry is growing and prospects for nuclear energy development are highly encouraging. The Idaho National Laboratory, building upon its historic role in U.S. nuclear energy research and development, is looking at ways to utilize emission free nuclear power beyond electricity production to provide alternative clean fuels. This session, Congress will likely extend tax breaks for alternative energy development, including wind, solar, geothermal, cellulosic ethanol, biodiesel and energy efficiency.

Innovations in traditional fossil fuels extraction, specifically oil and natural gas, demonstrate promising results. We will continue to use fossil fuels for many years as we adapt to using alternative energy resources on a massive scale. It makes sense to devote resources to exploration and development of fossil fuels. In an encouraging sign, the annual Congressional ban on Outer Continental Shelf (OCS) drilling may be lifted for the first time in 26 years. It's important to make full use of OCS resources. That means opening up the East and West coasts for exploration, developing potential resources in ANWR and the Gulf of Mexico, and giving States the opportunity to share in important revenues from these activities. OCS oil resources could yield from 14 to 18 billion barrels of recoverable oil and 76 trillion cubic feet of natural gas. And, Congress should lift the ban on oil shale development. Development of oil shale, sedimentary rock that, when heated, releases petroleum-like liquids, could result in at least 800 billion barrels of oil.

To understand how these numbers translate into our energy consumption, in 2006, Idahoans used 15.6 million barrels of gasoline for their vehicles and used 75.7 billion cubic feet of natural gas. Total U.S. consumption of gasoline for motor vehicles alone in 2006 was 3.4 billion barrels, and total natural gas consumption for the U.S. in 2006 was 21.6 trillion cubic feet. Today, the U.S. consumes 20.6 million barrels of oil daily.

Energy is a global commodity and the regulatory environment plays a role in the price of energy. No long-term legislative solution to energy challenges is complete without improving government oversight of energy markets. I have supported legislation that helps the government regulator that oversees energy trading, the Commodity Futures Trading Commission, better do its job in increasing market transparency.

Understandably, these aren't short term solutions, nor is any one single option the answer. Once the leasing process is complete on OCS development for example, production would be a few years out. However, starting the process sends positive signals to energy markets. We cannot afford to wait any longer. We know the stories and the facts are evident. The time for talking is past. The time for action is now.

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