Hearing of the Subcommittee on Energy and Resources: Energy Demand in the 21st Century: are Congress and the Executive Branch Meeting the Challenge?
HEARING OF THE SUBCOMMITTEE ON ENERGY AND RESOURCES: ENERGY DEMAND IN THE 21ST CENTURY: ARE CONGRESS AND THE EXECUTIVE BRANCH MEETING THE CHALLENGE?
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Ms. Watson. I appreciate your help. This is the beginning of several days of hearings on the energy policy, and I am sure
that was stated by our Chair.
Energy is almost like food and water in the American lifestyle. It keeps us warm in the winter. It gets us to and from work. It cooks our meals and it lights our way. We use it to record the memories of our children, to play our music, and to entertain us. In short, we have a desperate need for it.
It has become one of those commodities that we almost take for granted. Yet, we should not take it for granted, for many reasons. The generation and the delivery of energy is a serious challenge; a challenge of engineering, a challenge of planning,
and even a challenge that evokes the most serious aspects of our foreign policy.
Energy costs represent a large and growing household expense to all Americans, and energy is a key factor in the environmental challenges we face in modern America. These issues are important to the American people, and when they stare at the gas pump, amazed at the price of gasoline, that hits people in their pocketbooks.
When their lights go out, because of deferred maintenance or even market abuses, our constituents are deeply and rightfully unhappy. When they learn that the money that they send overseas for energy imports is popping up in some despotic regimes, believe me, Americans care. When they learn that the sea level is rising and the water supplies are threatened, people then become very, very worried.
This was really brought home to the people in the State of California a few years ago, when big energy companies were allowed to run amuck. By now, many of you have heard the tape recordings of the Enron power traders laughing at how they were taking advantage of the elderly in California.
Well, it is not just Enron, and it was not just the elderly. We still have not put all the pieces back together, and California may never be compensated for the billions of dollars in overcharges that we suffered. But we must try to make things right and make sure that it never happens again.
These issues are important to the American people. They are important to Californians. They expect us to find solutions to them, and that is our job. I am glad that Chairman Issa has convened a hearing to help us do just that.
In the past, we have seen an ideological approach to energy that has resulted in a stalemate. It produced a bill that did not address our Nation's challenges, but just gave away new and larger subsidies to the big energy companies.
So in opposing this approach, and fortunately, the Senate refused to pass it, I hope we can together find new approaches.
In this Congress, we have a chance to start again. We can build a bi-partisan consensus on energy policy, and steer our country through the challenges that we all face. We know it can be done.
The National Commission on Energy Policy brought together business, labor, Republicans, Democrats, and developed an approach that they agreed could work. We can do the same, and I truly hope we decide to do so. Again, Mr. Chairman, thank you for this opportunity.
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Ms. Watson. I want to thank all the panelists. I think you have described the issue quite well. I keep going back in my mind to climate change. We saw the effects of it in Los Angeles, where we had a record rainfall. We almost broke the record, 33 inches. That is more than we get in 6 years.
Our electricity went off. We had floods. We had potholes, and so on. It all goes back to energy. So I want to ask the three of you, and I think Dr. Portney has already touched on some of this. But what do you think we can do about taking climate change into consideration and its relativity to energy sources, and our need for energy in the future?
I understand that now we are competing with the Chinese for oil. Everyone is driving a car. When I first went there, they were on bicycles or walking. So how are you relating the climate change to the sources of fuel, and what can we do? I know that is a big question, but try your best.
Mr. Caruso. Well, the one thing I can say about the greenhouse gas emissions is, if you look out over the 20 year forecast that I have presented the highlights of this afternoon, a significant amount of the CO
So because so much of their electricity is generated by coal, whatever we choose to do on an international basis, because I do not think we can look at this just from our own domestic perspective, we do need to bring in a broader array of countries to deal with this.
So I think that is the thing that just jumps out at you, when you look at the projections in our model; that there is so much growth in greenhouse gas emissions coming from developing Asian countries, that we need to do this on as broad a collaborative basis as possible.
Mr. Wells. I think I would start and respond domestically to pick up a little bit on what Paul was saying. We, as an audit agency, have an opportunity to look at the actions that are being taken by Federal agencies. For instance, I will go to EPA. We have ongoing work and PASS work looking at, for instance, mercury emissions from the power plants.
What we are finding when we look at and ask questions about how EPA is designing and coming up with their rulemaking, we challenge some of their methodologies and some of their economic analysis that are being used as being missing items. One of the things that we tend to notice, it is not only in mercury emissions, but we have noticed it in the gasoline marketplace, where EPA has a responsibility to approve and grant the permission for localities to use special fuels.
What we are seeing is that the total analysis being done are missing things that involve energy impacts. So our recommendation to much of the Federal Government would be to, when you make these rules, you need to consider, from a climate change standpoint, all the factors and the consequences that are derived from those factors. For gasoline, they were missing factors in terms of the impact to the energy market, as well as mercury emissions.
Ms. Watson. Thank you; Dr. Portney.
Mr. Portney. Thank you very much; I guess, in my view, there are three pieces to dealing with this climate change problem. One is, as Guy Caruso said, I think we need to re-negotiate an international agreement that would eventually at least begin to bring the developing countries in. Because as he pointed out, it will not be too long before CO
I will also say though that I do think it makes sense for the United States and the other developed countries to go first in beginning to reduce greenhouse gas emissions, since the stock of carbon dioxide in the atmosphere is mostly ours. I do not think it is inappropriate that we take the first steps.
In terms of how we go about reducing greenhouse gas emissions, I think there are two parts to this puzzle. One is to invest in new technologies. The hydrogen initiative is one part of this, but I think we need to invest more in energy efficiency and in renewables. Hydrogen, as I say, is an important component to that.
The third leg of the stool is the one that is politically more unpalatable. But the way you get people to consume less carbon-intensive fuels is to increase the price. That means electricity that derives from coal. It means higher prices for petroleum and higher prices for natural gas. I think we have to do that very, very gradually, and that will not be politically popular. I understand that.
But if we do that in such a way, through a carbon tax, for instance, that is at least spending off revenues and reducing the deficit and dampening the trade deficit, then I think people will understand that we are at least getting something else for that sacrifice, in addition to investing in a better environment.
Ms. Watson. If I have another minute, Mr. Chairman, global warming is something that has been looked at most often. I think that we have not really put enough research into looking at the impact.
We can see the net results, and we have to really change them. You can comment on this statement I am making, or not. I think what we really have to do is do much more in depth research as to all the factors causing this and the results, and we have to chance the demand, and I think you alluded to it.
That means educating our people, starting in school, on how to conserve, and looking for alternative technologies and so on. Those that are politically unpopular are the ones that we really need to get on top of.
I am so sure that our Chair is going to look into it and have our committee hold additional hearings. You have already started. I want to commend you for that, because I see a really serious problem for the United States. But you did mention that we needed to look globally and have an alliance as we tackle the climate changes. I think that is the only way that our hearings are going to be meaningful, if we end up doing that. So if you would like to comment, fine; but I wanted to make that statement, Mr. Chair.
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