[Congressional Record Volume 153, Number 121 (Thursday, July 26, 2007)]
[House]
[Pages H8735-H8737]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                              {time}  2315
                                 ENERGY

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
January 18, 2007, the gentleman from Pennsylvania (Mr. Peterson) is 
recognized for 23 minutes, half the time until midnight, as the 
designee of the minority leader.
  Mr. PETERSON of Pennsylvania. Madam Speaker, it's a delight to come 
to the House tonight and talk about an issue that I believe is vital to 
America's economic future, vital to the strength of our families, of 
our communities: energy.
  I want to congratulate the leadership of the House. Next week is 
going to be energy week. We are going to be having bills coming from 
the Resources Committee, the Ways and Means Committee. I think, 
tonight, tomorrow, we will be dealing with some energy issues in the 
farm bill, because I personally believe available, affordable energy is 
the number one challenge facing America.
  Now, from what I have seen in the committee structure, and I am 
hoping when we get to the floor we will have amendments, and we will 
have more discussion, but there are some concerns. I know that the 
bills coming to the floor remove incentives to produce domestic energy. 
That's energy produced in America or offshore. I know there is 
increases in taxes on domestic energy production. That's extra taxes on 
those who will produce, process energy here in America. But I see no 
incentives to produce the basic fossil fuels, oil, gas, nuclear, coal, 
or some that I think are potentially helpful, coal to liquids and coal 
to gas.
  I have a chart on my left here that shows us the current use of 
energy, 23 percent clean, green natural gas; 23 percent coal, mostly 
for power generation. Down here, we have 40 percent petroleum, and a 
large portion of that is our transportation system, but it's used in 
other ways too. Then we have nuclear energy in the kind of a light, 
grayish blue color over here.
  Now, the ones we really have all the hope for are here in the 6 
percent; that's our renewables. Now you will hear everybody promoting 
renewables, and we should. But let's look at what amount we today have 
from renewables, and how we can grow them. We are going to have lots of 
incentives, and we have had lots of incentives. The 2005 bill had 
incentives for all renewables.
  Solar is .06 of a percent of our energy supply today; .06, that's not 
even 1/10 of 1 percent. Now the one that surprised a lot of people is 
biomass, 2.4 percent. A lot of that's woody waste, it's the pellet 
stove industry, it's waste being burned in boilers to heat factories, 
to dry wood. Lots of places where they have wood waste, they put in 
wood-burning boilers. It's also been used to top coal-burning boilers 
so they can meet air quality standards, because wood burns cleaner than 
coal.
  Then we have geothermal. We know geothermal is using ground heat, 
ground temperature, water temperature; but it's .36 of a percent. Then 
we have hydroelectric that's 2.7. That's a figure that's declining 
because we have actually taken dams out in this country.
  Then we have wind, which we hear a lot about today, but it's .12 of a 
percent of our energy portfolio.
  I guess my concern is that we have a growing need of energy in 
America, somewhere, 2, 2.5 percent a year; and we all know that we must 
conserve. We must use energy more wisely. This chart shows you that.
  But it appears to me that all the hope, and all the faith, and all 
the incentives are going to be out here. We should have them out there.
  But if we don't produce more natural gas, if we don't produce more 
oil, and if we don't at least develop coal to liquids or coal to gas, 
then the growth in the renewables will not even meet the demand in the 
growth in energy use in the country, so it's very concerning.
  Now, I believe the one that we really miss out on is natural gas. 
Natural gas heats 57 percent of our homes. It heats probably 70 percent 
of our businesses. It's used in huge amounts to make electricity. I 
think 20 percent of our natural gas is now used to make electricity, 
and natural gas is a major ingredient in making ethanol.
  We currently have 116 ethanol plants, and we have 78 under 
construction, and seven that are under expansion. Up to 95 percent of 
these plants, we use clean, green, natural gas to run their boilers to 
make ethanol. So that is very vital to us that we have adequate amounts 
of clean, green natural gas.
  It's interesting that hydrogen is one that's not a percentage, but 
it's one that we talked about in hydrogen vehicles, but the hydrogen we 
make today is made from what? Natural gas.
  Biodiesel, not on the chart, but another item that's starting to perk 
out there. We use, again, a lot of natural gas to make biodiesel.
  Now, the problem we have had in America is we use a lot of natural 
gas, and here's the reason why: about 12 years ago we took away the 
prohibition of making electricity with natural gas. When this happened, 
we started to have a shortage. As the use of natural gas goes up, and 
we are not supplying more natural gas, we are getting huge price 
increases. Just 6 years ago, natural gas was less than $2 a thousand. 
Last year the average price to homeowners was about $12.50 a thousand, 
huge increases.
  Now, this has been monumental to business. Dow Chemical, chemical 
companies use huge amounts of natural gas; 55 percent of the cost of 
making chemicals in America is natural gas. They use it as an 
ingredient; they use it as a fuel. Dow Chemical's gas bill in 2002 was 
$8 billion, a lot of money. In 2006, it was $22 billion, and today it's 
rising.
  The problem we have is we have continued to make ethanol, all our 
chemical plants, fertilizer plants, fertilizer, 50 to 70 percent of the 
cost of making nitrogen fertilizer, natural gas. Natural gas is an 
ingredient. All the ladies who like skin softeners, a major ingredient 
in skin softeners is natural gas.
  Natural gas is in our carpets. It's in our drapes. It's in many of 
our clothes. It's in plastic products; 45 to 50 percent of polymers in 
plastic cost is natural gas.
  All the good industries we have left in this country use huge amounts 
of natural gas. For the last 6 years, we have had the highest prices in 
the world on natural gas because we have refused to open up new fields. 
We have refused to reach offshore. We have made it difficult in many 
parts of the West to produce natural gas.
  We look at it as something evil to drill a 6-inch hole in the ground, 
put a steel pipe in and let gas out. Yet it's what fuels the country. 
America is great because we always had cheap affordable energy up until 
6 years ago.
  Another factor many Americans don't know, and too many Members of 
Congress don't know is that natural gas is not a world price, when, 
currently, oil is $75, $77 a barrel, pretty painful for our economy, 
but it's pretty painful for all our competitors around the world too. 
But for 6 years, America has had the highest natural gas prices in the 
world. That's something we need to do something about.
  We can see a chart here of what it's done to manufacturing. We have 
lost more jobs in America because of natural gas prices. As natural gas 
prices have risen, manufacturing price jobs have dropped because the 
fertilizer industry in the last 2 years, 40 percent of manufacturing 
went offshore. They are hanging on with a string. If we don't

[[Page H8736]]

bring natural gas prices down in the world average price, our farmers 
will be using foreign fertilizer to grow corn to make ethanol. Doesn't 
sound like a winner to me.

  But it's vital, because one more chart here on trade, that a huge 
percentage of the trade deficit in this country is because of energy. 
We're buying our energy, our oil, 66 percent of our oil today comes 
from foreign, unstable, unfriendly countries. I find that a worry.
  The bills we have coming up next week deal not with increasing 
domestic production, because when you decrease domestic production, you 
increase foreign imports. Now, everybody says we should be independent, 
energy independent. It's an impossibility on oil. I wish it wasn't.
  Natural gas, we have reserves offshore, we have reserves onshore. We 
could be total supplying all of our own natural gas. We currently 
supply 80 some percent of ours, about 16 percent from Canada and a 
couple of percent LNG. But on oil, we have been gaining 2 percent a 
year in the last 10 years, every year, of foreign dependence. That's 
because we are buying this huge amount of energy from foreign 
countries, not our friends, and currently OPEC is in charge.
  OPEC has been controlling prices the last year again. For a while, 
they didn't have control. They are back in control. As we look at where 
we buy our oil, Canada is one of our biggest suppliers, but they are 
really the only friendly one that we are really close friends with, and 
it's the one that we could be comfortable with.
  The rest of the countries aren't even stable governments and could 
topple tomorrow. We currently have $75, $76, $77, I am not sure where 
it is today, but it was bouncing around there, and that's with no 
storms in the gulf and with no country that's in trouble at the moment. 
If we have one of the big exporting countries in trouble, and a couple 
of storms in the gulf like we did 2 years ago, we could be at $85, $90 
and we could be approaching $3.50 and $4 gasoline. We all know the 
devastation that will have on us.
  I have legislation I want to brief you on before I run out of time, I 
know I am getting short, but I have legislation called the NEED Act. 
It's about opening up the Outer Continental Shelf. It's 3 miles to 200 
miles offshore where we have energy. Every country in the world 
produces on their Outer Continental Shelf but America, every country in 
the world, Canada, Norway, Sweden, all those green countries. They all 
produce energy offshore.
  We have chosen to lock our Outer Continental Shelf up. It's a 
terrible mistake. It's the last environmentally hazardous way to 
produce gas and oil. My bill is gas only. It gives States control of 
the first 50 miles. The first 25 are locked up; the second 25 are open, 
if they want them open. The second 50 miles is open unless they have 
legislation, and they can even close it; and the last 100 miles is open 
automatically.
  It would open up great reserves so we could have access to natural 
gas so we could stabilize prices in this country, so we could have 
energy to heat our homes, affordable energy to heat our business, 
energy to maintain the employment base in America that we are losing. 
If we don't stabilize natural gas prices, we are going to lose the 
petrochemical business. Dow Chemical just committed $32 billion to 
Saudi Arabia where gas is $1.25, where ours runs $10 or $12.
  Folks, we have to bring natural gas prices down so we can maintain 
what's left of the fertilizer industry, polymer and plastics industry. 
The steelmakers tell me they can't stand any more high prices, aluminum 
makers.
  My prediction, if we don't deal with the natural gas crisis in 
America, Americans will not be able to heat their homes affordably. 
Small businesses will not be able to stay in business if they use any 
amounts of energy, and we will be shipping all of these great jobs that 
made our country strong and to give our jobs to the working middle-
class people of America, we are just going to be giving those away to 
other countries.
  I predict the big bulky items, even like bricks and glass, will be 
made in nearby Trinidad, which is an island north of South America, 
only one day away in a ship where gas prices are only 90 cents.
  I believe it's vital that as we approach the energy issue next week, 
that we talk about production, that we talk about how we continue to 
have adequate energy in America, and how we specifically have adequate 
natural gas to maintain the industries we have left. If we have an 
energy bill that only makes it more difficult to produce domestic 
industry, if we have an energy bill that only makes it more expensive 
to produce and if you tax, the production of oil and gas, if you tax 
the production of any kind of energy, if you tax that, you raise the 
price, you raise the price to consumers, because they pay it, we end up 
paying it as consumers. So it's vital.
  In my view, it's vital that we have an energy bill next week and we 
have an open debate and we have lots of chance for amendments, we get 
to talk about it. What would coal liquids do?
  I think the President has proposed cellulosic ethanol. Now, it's a 
good idea. That's making ethanol out of cellulose instead of corn, but 
the problem is, it's still in the laboratory. It's close to being able 
to come out of the laboratory, and, therefore, is funding six plants, 
futuristic. I am for that.
  We ought to be doing the same to coal liquids. The Germans have made 
liquids and gas out of coal in World War II when they had embargoes and 
couldn't get oil. So we ought to be streamlining that process and 
having it ready. We ought to be juicing up our nuclear. We need all of 
the 35 nuclear plants that are under permit process today to be built 
by 2030 to just maintain 20 percent of our electric grid to remain 
nuclear, no growth.
  The growth in the need of oil and gas continues, as our economy 
continues, and the problem we have today that we didn't have a few 
years ago. Just 6 years ago, gas was $2 a thousand, oil was $10 a 
barrel, just 6 years ago.

                              {time}  2330

  And today there is a shortage of oil in the world, and we have 
competitors like China and India that are consuming energy at a much 
faster growth than we are. They are increasing their energy use 15 to 
20 percent a year. They are buying up reserves all over the world. They 
are building coal plants, coal-to-liquid plants. They are building 
nuclear plants. They are building the biggest hydro dams in the world. 
They are preparing for their economic future.
  In America, because we have never had an energy shortage like this, 
we have had little shortages for months and years or part of a year in 
the 1970s, 1980s, and 1990s when there were world crises, but the 
current prices, as high as they are, are a floor on which we are going 
to have spikes. When we have spikes and we have $100 oil, Americans are 
going to struggle. They are going to struggle to heat their homes, they 
are going to struggle to drive their cars, especially the poor 
Americans, and the companies that use a lot of energy are going to 
struggle to make products and compete in the global marketplace.
  I think it is vital next week that this Congress deals with energy 
openly. I want all the renewables to be promoted and incentivized and, 
yes, even subsidized. But when they are fractions of a percent, you can 
double them or triple them in 5 years, and they are still a fraction. 
They will not meet the needs of our society in the next couple decades.
  We have to have fossil fuels. Some people hate fossil fuels. We need 
to use them as clean as we can. We need to use them as wisely as we 
can. We are going to have to conserve, because I want to tell you, the 
next spike in energy crisis, the Americans are going to be conserving 
because they are not going to have the money to pay for it. They are 
going to have to cut down their travel, they are going to have to keep 
their houses cold, and that is not how Americans should live.
  This Congress should not be restricting access of the Outer 
Continental Shelf. We should not be restricting access to the vast 
reserves that are in this broad country. We know how to produce energy 
today. We ought to be forcing forward coal-to-liquids. We ought to open 
up the Outer Continental Shelf.
  And those who scream about the oil companies making huge profits, it 
is my opinion that the oil companies

[[Page H8737]]

have made huge profits because of Congress and the administration. When 
you restrict supply, then you increase price. And so when oil companies 
and gas companies invested in reserves and did that with the hopes that 
they would be worth $30 a barrel, and they became worth $75 a barrel, 
they are going to make a lot of money. If you had a monopoly on any 
issue or any item, and you expected to sell it for $10 a profit, and 
then the supply gets short and you can sell it for $30, you are going 
to make a lot more money. That is just basic economics.
  So the reason oil companies have made a lot of money is they invested 
in oil, they invested in gas reserves assuming that their prices were 
going to be far less. And when our government decided that we weren't 
going to produce it domestically, we were going to depend on foreign 
countries because foreign worked cheap; it didn't really matter even 6 
years ago. There was a lot of concern about our growing dependence on 
foreign energy, but it didn't matter. It was cheap, $2 for gas, $10 for 
oil. Nothing competes with that. There is no reason to go in any other 
direction.
  But that is all behind us, and it is all behind us because there is 
actually shortness of energy in this country and in the world. And so 
we are huge competitors. China will surpass us in energy use very soon. 
India is using huge amounts. All the developing countries, as they 
develop their auto fleets and their manufacturing bases, they are all 
using huge amounts that they didn't before. They lived very simple 
lives. So as the world progresses, the need for energy will grow.
  And America seems to me to be the country that is doing the least to 
prepare for its energy future. And its energy future is available, 
affordable energy, and we should have lots of gas, lots of coal, lots 
of oil, all the renewables we can get, expansion of nuclear. We need to 
be looking down every road, every new way of producing energy we can, 
and the cleanest and greenest we can have it. And we should be 
conserving it as much as we can and not wasting it.
  But, folks, we are in trouble. As a country, we are facing serious 
problems, because energy that is affordable and available may not be 
with us in just the short months and years ahead. Two storms in the 
gulf this summer, one or two of the sending countries that export oil 
have a problem in their government. It happens all the time.
  Eighty percent of the energy of gas and oil in the world is owned, 
controlled, marketed by countries that are not democracies, not our 
friends, and they own the oil company. Exxon is the 14th largest oil 
company in the world. The 13 larger are monopoly oil companies owned by 
the government, and those are who we are going to depend on.
  America needs to secure its energy future. It needs to produce 
adequate amounts of gas, oil, coal, and all the renewables we can. We 
need to have an energy policy. And I hope next week we can debate all 
these facts. Natural gas is the clean green fuel that can be the 
bridge, help us with ethanol, help us with hydrogen, help us with 
biodiesel, and even a third of our auto fleet can be fueled with 
natural gas. We would save 2\1/2\ million barrels of oil a day. America 
needs to prepare for its energy future.

                          ____________________