[Congressional Record Volume 146, Number 115 (Monday, September 25, 2000)]
[Senate]
[Pages S9128-S9131]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                                 ENERGY

  Mr. DOMENICI. Mr. President, I would like to talk about two things 
today. The first is energy policy--or America without an energy policy.
  Let me say with as much certainty as I can muster that we have no 
energy policy because the Interior Department of the United States, the 
Environmental Protection Agency of the United States, and the Energy 
Department all have priorities, and they are ideological priorities 
that put the production of energy for the American people last. There 
is some other objective, motive, or goal that is superior to the 
production of oil and gas and the development of an energy policy that 
uses coal.
  Do you think Americans know today that we have not built a coal-
burning powerplant in America in 12 years? Do you think Americans know 
that the only thing we are doing to increase our electric capacity so 
they can have light, electricity, and everything else in their homes is 
to build a powerplant

[[Page S9129]]

with natural gas? We have built five--all with natural gas. And we sit 
back and wonder why natural gas has gone from $2 to $5.63 in 9 months.
  Let me be the first to predict that the next crisis will be when 
natural gas goes even higher, because we have made it the only fuel we 
can use--under what? Under the policies of the Environmental Protection 
Agency, which has their own rules, their own regulations, and their own 
ideologies. I have not heard them say once we have adjusted an 
environmental concern because we are worried about America's energy 
policy.
  I wonder if the occupant of the chair has ever heard the 
Environmental Protection Agency say we must be doing something wrong 
because there are no new refineries being built in America--none, zero, 
zip. The greatest nation on Earth has not built a new refinery to 
convert crude oil into the products of everyday use for years. We have, 
in fact, closed 38 refineries to environmental concerns--albeit they 
are small.
  We own millions of acres of land. That is why I say the Interior 
Department is part of our energy policy. But they have different 
concerns. They never consult on energy issues. So what do they do? They 
lock up millions of acres of land that could produce oil or natural gas 
and say, We are not going to touch them.
  Why don't you ask Americans? Why don't you ask Americans whether they 
want to be more beholden to the cartel or whether they would like to 
use a little bit of their property to go in and drill an oil well? Do 
it with whatever protection you want for the environment.
  Let's have a serious debate about ANWR, an American piece of real 
estate that is beautiful and something we should protect. It has many 
millions and millions of barrels of American oil that could be produced 
by American companies for American use. And every time it is brought up 
on the floor of the Senate, the environmentalists in America consider 
that even to take a little, tiny piece of that huge refuge and go see 
how many millions of barrels of oil are there would be the biggest 
environmental disaster ever.
  But who is worrying about Americans who want to use oil and have it 
refined so they can drive their automobiles? Who would like to use the 
coal we have in abundance and make sure we use it as cleanly as 
possible, and build powerplants so we don't run out of electricity and 
so we don't have brownouts in California?--Brownouts which some are 
predicting today because the policies that could have affected the 
production of electricity for California have not been judged on the 
basis of our energy needs, they have been based only upon environmental 
purity.
  That is why the United States of America is the most difficult piece 
of geography occupied by humans in the world in terms of establishing 
in America a powerplant. It is the most difficult and expensive place 
in the world to build a powerplant with the greatest engineers and 
scientists around. We can't build one because there is no agreement 
between the Environmental Protection Agency and the public holders of 
land to work together. The question is never asked: What would be good 
for American energy policy?

  Let me move on. Let me make sure we understand. We don't have someone 
making energy policy, or setting the rules, or saying to the American 
private sector: Here are the rules; go work under them. We have none 
because Interior, EPA, and Energy all have priorities, and none of 
their priorities makes the production of oil and gas and the 
development of our coal high priorities.
  The Interior Department is making the drilling for oil and natural 
gas as difficult as possible. EPA, rather than devising good 
environmental policy based on sound science, it has become the enemy. 
This is due to an ideological, pure environmental policy at the expense 
of providing energy we need. This is not understood by most Americans. 
Yet we have an Energy Department. Sometimes I feel sorry for the 
Secretary of Energy because there is no authority for them to do much 
about anything. But we do have a strange oxymoron. We have an Energy 
Department that is anti-nuclear power and pro-windmills to produce 
electricity and sources of electrical power for America.
  I might repeat, we have an Energy Department that is pro-windmill and 
anti-nuclear. I give Secretary Richardson credit for moving slightly 
under the prodding of Congress to do a little bit of research in future 
years on the use of nuclear power, which may end up falling on America 
as being the only thing we can do in 15 or 20 years that is 
environmentally clean by the time we get around to explaining it as 
safer than most any other source of energy. Yet only recently do we 
have an energy policy that would consider anything that has to do with 
nuclear power now or for the future.
  Treasury Secretary Summers warned the President that the 
administration's proposal--now a decision--to drive down energy prices 
by opening the Government's emergency oil reserves--and I quote--
``would be a major and substantial policy mistake.'' Summers wrote the 
President--and Greenspan agreed--that using the Strategic Petroleum 
Reserve to ``manipulate prices rather than adhering to its original 
purpose of responding to a supply disruption is a dangerous 
precedent.''
  You see, fellow Senators, we have established a Strategic Petroleum 
Reserve in the afterglow of some foreign country saying, ``We are 
cutting off your oil supply.'' And, even though it was a small amount, 
they said, We are cutting it off--and we were dependent on it. Lines 
were forming at our gasoline stations. Do you recall? In the State of 
New York, the lines were forming at 5:30 in the morning, to my 
recollection. People were so mad at each other that, if they thought 
somebody went ahead of them in line--in one case in eastern America, 
they even shot the person who went ahead of them in the line.
  We said we ought to find a place to put crude oil so that if anybody 
stops the flow of crude oil to America, or engages in some kind of war, 
or mischief that denies us our energy, we will have a certain number of 
days of supply in the ground for use. Mr. President, that is a lot 
different than an America which is now without any energy policy.

  We say the prices have gone too high, even though everything I have 
said contributed to it: An Interior Department that won't let you 
produce oil, an Environmental Protection Agency that has no reason to 
consider whether their rules and regulations are so stringent, too 
stringent, beyond reasonable, whether in the area of refineries, in the 
area of building a powerplant, in the area of producing more energy 
through wells that we drill, their policies have nothing whatever to do 
with energy needs of our country.
  With all that piled on America, we have an election coming up and the 
oil prices are a little too high. We would like to take a little bit of 
that oil out of the reserve and put it on the market and use it. 
Secretary Summers added that the move ``would expose us to valid 
charges of naivete, a very blunt tool to address heating oil prices.'' 
That is from the Secretary of the Treasury a couple of weeks ago.
  Of course, over the weekend, a spokesman for this administration and 
for the Gore campaign got on the national networks and said: The 
Secretary is with us. Of course, he works for the President.
  They all sat down and said: What is the worse thing that can happen 
to the Gore campaign? Clearly, they all said if these oil prices keep 
going up. It is not a question of, can we produce heating oil; our 
refineries are at the maximum production already. This release of 
additional barrels from the reserve can do nothing for that. It is just 
that the price is so high that a lot of poor people in northeastern 
America who still use heating oil, and those in the West are not aware 
how many, but there are millions; they are not going to be very happy. 
That is the issue. That is why the petroleum reserve is being used.
  The truth is, in our country it behooves people like myself and many 
others to at least make sure the public understands why we are in the 
mess we are, who got us there, what was done to make it so that it 
wouldn't happen the way it has. All the answers come down to the fact 
that nobody was worried so long as the prices were cheap, so long as 
those OPEC countries were producing more than was needed in the world, 
keeping the prices down at $10 or $11 or $12 a barrel.

[[Page S9130]]

  While we lived happily and merrily, month by month, with that 
situation, firing up our great economic recovery, at the same time we 
were destroying millions of little stripper wells that were producing 
three and four barrels per well. They closed down because the price was 
too cheap. Even today, we are producing less oil than we were 3 or 4 
years ago because we destroyed oil production capacity when we let it 
go too low, while we were exhilarated with the fact that the cartel was 
cheating on itself and the price of oil was coming down. We didn't 
bother to find out how much that was affecting New Mexico in an adverse 
manner. When it went up in price, we went to them and said: Now it 
ought to come down; it is too high. I don't imagine for the first few 
months they greeted us with too much joy or willingness to help us 
after we sat by and watched it go so low without any concern for what 
happened to them.
  Refineries were running at 95 percent last week. To take a supply out 
of SPR, it would still need to be refined into heating oil. Obviously, 
I have explained that isn't the issue. The issue will be the price. We 
don't have enough refining capacity to take the SPR and add to the 
supply of heating oil.
  What else does this using the reserve as it was not intended by 
Congress do? It sends the wrong signal to the private industry in 
America. If I am in the business of storing heating oil, and the 
Federal Government starts stockpiling, I cut my reserve and I assume 
somebody will come in here asking us to prohibit them from cutting 
their own reserves. Clearly, they cannot keep their storage to maximum 
capacity while the government is building its own capacity to compete--
something we won't figure out until it is too late. Then somebody will 
say: Why did this happen? They should not have cut back on their 
reserves.

  I indicated natural gas prices were going up, up, and away. This 
fantastic fuel is $5.35 per 1,000 cubic feet; 6 months ago it was 
$2.16. We are talking about oil and derivatives of oil because of the 
cartel. From $2.16 to $5.35 is not because of any cartel; it is because 
of the huge demand for natural gas. When the demand gets so big the 
production can't go up so fast, what happens? The price goes up. That 
is a big signal and a sign to us.
  No one seems to be concerned in this administration that we haven't 
built a powerplant to generate electricity for the growing demand, such 
as in California. We haven't built a new powerplant of any significance 
because the only thing we can build it with is natural gas. We cannot 
build it with coal, even though they were being built around the world. 
America's environmental laws are out of tune with America's energy 
needs. They haven't been tuned to be concerned about America's energy 
future. It is just ideological--as pure as you can get it in terms of 
environmental cleanliness. That is it for America.
  Inventories are 15 percent below last winter's level and 50 percent 
of America's homes are heated with natural gas. They are beginning to 
see it in their bills. Clearly, America has almost no competitor for 
that. We don't have an abundance of electricity to take its place. In 
fact, brownouts are expected in many parts of the country because we 
are underproducing what we need by way of electricity.
  Natural gas fires 18 percent of the electric power. I am sure there 
are many sitting back saying: Isn't that neat? We haven't had to worry 
about nuclear. We don't have to clean up coal to the maximum and use 
some of it to produce electricity in America. We just build natural gas 
powerplants. We used to forbid it. I think the occupant of the Chair 
remembers that during the crisis we said don't use natural gas for 
powerplants. We took that out.
  Here goes America. Next crisis, will there be enough natural gas or 
will the price be so high? It will not be just to those who are burning 
it for powerplants. It will be in 50 percent of the homes in America. 
They will start asking: Where is an energy policy with some balance 
between energy sources instead of moving all in one direction because 
all we were concerned about was the environment?
  Compared to 1983, 60 percent more Federal land is now off limits to 
drilling. I spoke generally of that. Now I will be specific. As 
compared with 1983, there is 60 percent more Federal land that is off 
limits for drilling. On October 22, 1999, Vice President Gore said in 
Rye, NH: I will do everything in my power to make sure there is no new 
drilling.
  I guess what we ought to be working on is when will we no longer need 
any crude oil, which is refined into gasoline and all those wonderful 
products? Because, if you brag to America that you will do everything 
in your power to make sure there is no new drilling, we have to ask the 
question: Where are we going to get the oil?
  I will move to another item that I spoke of generally a while ago, a 
great American reserve of crude oil called ANWR, up in Alaska. I 
believe any neutral body of scientists--geologists, engineers--could go 
up there and take a look and report to the Congress and the people of 
this country that ANWR could produce oil for America without harming 
that great natural wilderness. I am absolutely convinced that is the 
case. Yet you cannot believe the furor that attends even a mild 
suggestion that we ought to do something such as that. Perhaps somebody 
will even quote what I just said, saying that I am for destroying the 
ANWR, that I am for destroying that wilderness area, that natural 
beauty.
  No, I am not. I am for trying to put together a policy that increases 
our production of crude oil so we can at least send a signal to the 
world that we do not want to increase our dependence. We want to do 
something for ourselves, and wouldn't it be nice if there were a stable 
oil market so Americans could get involved in production here at home, 
hiring Americans? It would be owned by Americans if that happened in 
ANWR. What a stimulus for American growth in oil-patch-type activities.
  OCS, offshore drilling--off limits. There is no question we could 
double our domestic supply if we could open up some of the offshore 
drilling areas. Clearly, the more we have to import crude oil, the more 
the environmental risk in getting it here in tankers where something 
could happen to them. The amount keeps going up. Yet right in various 
of our bays and ocean fronts, there is natural gas in abundance. And 
there exist wells where we have proved we know how to do it. But 
somebody says: Oh, my, no more of that. That's environmentally 
degrading.
  What are we going to talk about when Americans say we cannot afford 
the natural gas because the only thing we are fueling powerplants with 
and using in America is natural gas? We have it out there in the oceans 
and in some bays--yet we would not dare touch it? There are 43 million 
acres of forest land that are off limits for roadbuilding, thereby 
making exploration and production impossible.
  The Kyoto agreement would envision doubling the use of natural gas, 
thus doubling electricity costs. No policies address either 
consequence. Multiple use, which we used to think was a great thing for 
our public lands, is only words today. Multiple use means if there are 
natural resources that can help Americans and can help prosperity and 
help us grow, that ought to be used along with recreation and other 
things. That has almost left the vocabularies of those in high places 
who manage our public lands. There are 15 sets of new EPA regulations 
that affect the areas we are talking about. Not one new refinery has 
been built since 1976. This administration's energy policy has, in my 
opinion, been in deliberate disregard of the consequences on the 
consumers' checkbook and their standard of living and the way people 
will be living in the United States.
  This summer we had soaring gasoline prices and that left motorists in 
America--as prices soared they got more and more sore, but they didn't 
know who to get sore at. The prices are still pretty high.
  Other consequences that have been deliberately disregarded are the 
electricity price spikes California experienced this summer. 
Californians usually spend about $7 billion a year in electricity. This 
spike was so dramatic they spent $3.6 billion in the month of July, 
only half of what they spent annually before that. That is a great 
question to be asked--why? California is a big electricity importer. 
They have ever-growing demands because of Silicon Valley. These 
companies use a lot of electricity and a lot of energy. Demand was up 
20 percent in the San

[[Page S9131]]

Francisco area last year, but there is no new capacity. Environmental 
regulations make building a new powerplant in California impossible. 
That may be what they want. But I wonder where they are going to get 
the energy? Where are they going to get the electricity when nobody 
else has any to spare?

  I predict in a very precise way that home heating bills this coming 
winter will be exorbitant, even while we are experiencing the gasoline 
spikes in the Midwest. It used to be one type of gasoline was suitable 
for the entire country. You remember those days. There are now 62 
different products--one eastern pipeline handles 38 different grades of 
gasoline, 7 grades of kerosene, 16 grades of home heating oil and 
diesel, 4 different gasoline mixtures are required between Chicago and 
St. Louis, just a 300-mile distance.
  As a result of these Federal and local requirements, industry has 
less flexibility to respond to local and regional shortages. There are 
15 sets of environmental regulations--tier II gasoline sulfur, 
California MTBE phaseout, blue-ribbon panel regulations, and regional 
haze regulations--on-road diesel, off-road diesel, gasoline air toxics, 
refinery MACK II, section 126 petitions, and there are 6 more.
  S. 2962 includes a wide array of new gasoline requirements that are 
both irrelevant and detrimental to tens of millions of American 
motorists. Legislation mandates the use of ethanol in motor vehicles 
that would cut revenues to the highway trust fund by $2 billion a year 
as one side effect. The U.S. Department of Energy has projected this 
one bill would increase the consumption of ethanol in the Northeast 
from zero to approximately 565 million gallons annually.
  I have taken a long time. I have given a lot of specifics and some 
generalities. But I conclude that it is not difficult to make a case 
that we do not have an energy policy; that the U.S. Government has not 
been concerned enough about the future need for energy of our country, 
be it in natural gas, in the products of crude oil, how do we use coal, 
how do we make electricity.
  Frankly, things were very good. They were good because the cartel was 
selling oil in abundance. While America was enjoying its economic 
success story, a big part of that was because the cartel was having 
difficulty controlling its own producers. We lived happy and merrily on 
cheap oil as our production went down and we sought no other 
alternatives, and our demand grew as did our use of natural gas. 
Americans and American consumers are left where, in many cases, they 
are going to be put in a position where they can't afford the energy 
that will permit them to live the natural lifestyle that is typically 
American--living in a home and having in it electric appliances and 
whatever else makes for a good life, with an automobile, or maybe two, 
in the driveway. It will not be long that the voices from those 
situations, those events in America, those kinds of living conditions 
will be heard loud and clear. There will not be enough of a Strategic 
Petroleum Reserve to solve their problems because we have not cared 
enough to do something about it.
  I yield the floor.

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