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Published By: Peoria Journal Star
October 19, 2008

 
By Dave Conover

Energy has been a critical political and economic issue throughout American history. The steamboat, coal-powered railroads, steel production, electrification, Standard Oil Trust, the Model T, the Teapot Dome scandal, commercial nuclear power, the Arab oil embargo - each of these developments has helped define entire eras.
 

And yet today, by any objective measure, the energy challenges facing America and the world are more formidable - and more consequential - than ever before.

At the most basic level, a world population of nearly 7 billion is driving huge growth in global energy demand. Oil prices, which are set on the international market, closed above $100 a barrel for the first time in February, and coal and natural gas prices are rising rapidly as well. Global demand will keep growing as nations such as China and India develop, with projections for a doubling of global energy demand by 2050.

Meanwhile, threats from global warming have become increasingly acute. Efforts to reduce greenhouse gas emissions will necessitate politically ambitious policy approaches to cutting emissions, both here and abroad, while meeting rising energy demands.

Failing to cut global emissions risks massive impacts, including widespread drought, rising sea levels, declines in regional agriculture, displacement of large populations and scarcity of fresh water.

At the same time, the geopolitics of oil and natural gas continue to be complex and potentially dangerous. More than three-quarters of the world's known oil reserves, for example, are owned not by private corporations but by state-owned, nationalized companies like Saudi Arabia's Aramco, who are not accountable to shareholders or Western governments. The United States, of course, has only 3 percent of world petroleum reserves, while consuming about a quarter of global oil.

All of these concerns have moved energy to the very top of American political and policy priorities. For the first time in decades, both major party presidential nominees are addressing energy policy as a key part of their stump speeches and campaign platforms. Congress has produced important energy bills in 2005 and 2007, but lawmakers only tangentially address the most difficult issues, which threaten to become polarized along party and regional lines.

In an attempt to help Congress sort out these issues, the National Commission on Energy Policy - a bipartisan, not-for-profit group of 20 leading energy experts - has issued a series of major recommendations to Congress and the president in recent years. The commission is made up of business, labor, consumer, environmental and former government leaders - a mix of interests similar to those needed to implement major revisions in U.S. energy policy.

NCEP's latest recommendations include:

- Increase fuel economy of new U.S. autos by about 1 mile per gallon per year.

- Promote a new generation of biofuels by reevaluating existing ethanol subsidies and tariffs and directing public resources toward more promising options such as cellulosic ethanol, biobutanol, and diesel fuel from organic waste.

- Limit U.S. greenhouse gas emissions through a mandatory, market-based program to cut economy-wide emissions by 15 percent below 2006 levels by 2030; and cap the price of permits under such a system to prevent undue costs to the economy.

- Create incentives for comparable climate mitigation action on the part of key U.S. trading partners, including developing countries, by providing resources for transfer of low-carbon energy technology.

- Enhance and extend tax incentives for energy efficiency enacted under the 2005 Energy Policy Act, and ensure that the Department of Energy issues increased standards for appliances and equipment to capture cost-effective savings.

- Double direct federal expenditures on U.S. energy-technology research and development, especially regarding technology directed at oil security and climate change objectives.

- Direct more resources toward accelerating the commercialization of carbon capture and storage technology, especially regarding coal-fired production of electricity.

- Provide more investment certainty for key renewable energy resources such as wind and solar by extending federal production tax credits in five-year increments.

Adoption of these and other policies would represent a substantial down payment, but hardly a full solution. Right now, several key issues - of long-term, sustainable energy supply, of technology development and of greenhouse gas reductions - remain unaccomplished. These measures would put us on track to do so.

No matter who is the next president or which party controls Congress, fundamental issues like energy policy will require bipartisan approaches to make lasting progress. The National Commission on Energy Policy is just one project of the Bipartisan Policy Center (BPC), founded by former Senate majority leaders Howard Baker, Bob Dole, Tom Daschle and George Mitchell, to foster bipartisan solutions to key national issues.

And we are glad to participate in Peoria's upcoming Midwest Energy Solutions symposium to discuss what public policy changes are needed to have a more thoughtful, comprehensive national energy strategy.

The implications of energy for our nation and the globe are too important to stay locked in a political stalemate. Agreement on urgent policy solutions can be achieved. Americans will be voting for that anyway in November.

Dave Conover is the former assistant secretary for policy at the U.S. Department of Energy. He is a member of the Washington, D.C.-based Bipartisan Policy Center and will be among the presenters at the Oct. 28 "Midwest Energy Solutions" conference at the Peoria Civic Center.