[Congressional Record Volume 153, Number 125 (Wednesday, August 1, 2007)]
[House]
[Pages H9538-H9541]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                                 ENERGY

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
January 18, 2007, the gentleman from Pennsylvania (Mr. Peterson) is 
recognized for 32 minutes, which is half the time until midnight, as 
the designee of the minority leader.
  Mr. PETERSON of Pennsylvania. Mr. Speaker, tonight I'd like to share 
with the House what I think is the most important issue facing this 
country. Later this week we will have an energy bill, or a so-called 
energy bill, because the number one issue facing America, in my view, 
is available, affordable energy.
  First, I'd like to look at my chart on my left here, and this is the 
energy as we utilized it in 2005. It has not changed much in 2006. It 
changed very little in 2007.
  The number one form of energy that we use is oil, 40 percent.
  The second item is natural gas, 23 percent. Now, natural gas is used 
to heat our homes, to heat our businesses. It's used by many people. 
Many people are not aware that it's used in making many goods. 
Petrochemicals use it as a fuel and use it as an ingredient. Fertilizer 
uses it as a fuel and as an ingredient and so does polymers and 
plastics. In fact, most of the man-made materials today have natural 
gas in them as an ingredient, and they also use natural gas as a fuel 
to make the product. Plus, we also now generate more than 20 percent of 
our electricity with natural gas. So natural gas is the one that's been 
growing in use but not in production.
  Coal is an equal amount which we use a lot to generate electricity 
mostly, 23 percent, heat a few factories. Nuclear, again to generate 
electricity. Hydroelectric, again to generate electricity.
  Biomass is the one that's been growing. Nobody talks much about it. 
But it's woody waste, it's used in the pellet industry for pellet 
stoves to heat our homes. It's one of the new uses of wood waste made 
out of saw dust. Also, biomass is used in power generation. It is used 
to top coal loads so that they bring the air standards down because it 
burns cleaner, and many factories are now using waste pallets and waste 
wood to heat their factories because it's a cheap fuel.
  Geothermal is one that's growing slowly. It's usually with new 
construction, not old, because of the underground work that's needed to 
use geothermal to heat your home or business.
  Wind and solar are the ones we hear a lot about. Hydrogen is not even 
on here, but hydrogen vehicles is another one I should mention.
  But this shows you, and I guess the part that is worrisome is that 
all of our energy bill deals with the last four: biomass, geothermal, 
wind and solar, or hydrogen.

                              {time}  2300

  The numbers in them are so small. We are all for them. The energy 
bill also does some good things. It does deal with conservation, wiser 
use of all of our forms of energy, better CAFE standards, although I am 
not sure that's in the bill, although there is talk about that being 
there, use, getting more fuel efficient cars.
  But there's a lot of things in this bill that are very alarming. I 
believe that our 66 percent dependence on foreign oil will increase 
under the proposed legislation, because this bill goes in the wrong 
direction. Today, oil reached $79 a barrel, closed at $78.77, record 
high. I talked to some energy people this evening at a dinner, and they 
would be surprised if it doesn't reach $100 this summer or this fall.
  Everything is in place. There is a world shortage of oil. We are not 
producing as much as we should be, and the tremendous consumption by 
countries like China and India and all the developing nations are now 
using huge amounts of oil. They are roaming around the world, signing 
up contracts, while we sort of sit along the sidelines dealing with the 
lower four.
  The Wall Street Journal yesterday reports that the Organization of 
Petroleum Exporting Countries posted record revenues of 650 billion 
last year on high crude prices and increased oil production, 650 
billion, many of those our dollars.
  Another move to use energy as a political weapon, Russia announced 
today that it's cutting off Belarus off from its natural gas supply. At 
the same time, Russia is trying to annex the North Pole in a very 
controversial move, contravention of international law, to feed its 
energy lust.

[[Page H9539]]

  Yesterday, it was announced that Venezuela has joined China, Norway, 
Canada and Spain to produce energy right off the Florida coast.
  The Iranians and the Chinese are inking new energy production 
agreements with Venezuela. Dow Chemical just announced that it's going 
to build a $22 billion chemical facility in Saudi Arabia because 
natural gas supplies in this country are too tight, energy prices are 
too high.
  What most people don't realize is that natural gas is not a world 
price. We had $78 oil today. The whole world does. We have had the 
highest natural gas prices in America of the whole world for 6 years, 
and that has endangered the financial stability of chemical companies 
and fertilizer companies and plastic and polymer companies and steel 
and aluminum and bricks and glass that use huge amounts of natural gas 
to make them.
  Recently, the Business Roundtable, which represents 160 CEOs of the 
leading companies in America that use energy, 4.5 trillion in annual 
revenues, with 10 million employees, wrote in a letter recently, ``None 
of the House [energy] bills addresses the critical need to increase 
domestic supplies of petroleum liquids and natural gas. Energy security 
means having well diversified sources of energy--not putting all of our 
eggs in one basket. Alternative fuels will not eliminate the need for 
traditional energy resources and, without additional supply, the tight 
market conditions that have put pressure on prices are likely to 
persist. The result may well be greater reliance on imports,'' and 
there are many who predict that we have been increasing our dependence, 
2 percent every year. Some think we will spurt up to 70 real quickly, 
because of the energy bill.
  The result, the unnecessary and counterproductive impediments to oil 
and gas leasing, on Federal lands, contained in this bill, report by 
the Natural Resources Committee, will have an immediate negative effect 
on domestic production and should not be adopted by the House.
  It will cut off 9 trillion cubic feet of natural gas from the 
Colorado Roan. It will cut off 2 trillion barrels of oil shale from oil 
shale resources. It will cut off 18 percent in Federal on-shore 
production, because it is removing the redundant NEPAs.
  Currently, we have off limits the Outer Continental Shelf, and this 
little spot in the middle here is the new Colorado Roan Plateau. It's a 
huge, clean natural gas field in Colorado that was set aside as the 
Naval Oil Shell Reserves in 1912 because of its rich energy resources. 
There is more natural gas there than was in the bill that was passed 
last year in the gulf.
  Cutting off the Roan Plateau was not the subject of any hearings, 
markups, and was done at the 11th hour. It also cuts off 2 trillion 
barrels of oil shale from oil reserves in some of the similar areas 
there, 2 trillion barrels. Now, that's the largest oil reserve known 
left. Like coal oil shale may prove to be our key to hundreds of years 
of energy security. This bill throws the key away by neutering the 
current oil shale program. Meanwhile, China is developing its oil 
shale.
  The NEPA program, NEPA studies, redundant NEPA study was legislation 
that I helped to get in the energy bill which says that redundant NEPAs 
are not necessary. Historically, groups who are trying to prevent 
drilling from happening would force producers into multiple NEPA 
studies, a NEPA study, an environmental impact statement. Many times 
before they were allowed to drill a well, they would have done three, 
four or five of them, each taking a year.
  I had talked to people who had leased land, and 7 years later had not 
produced any oil. That will not serve America well. The bill we are 
going to be considering cuts off 10 billion barrels from the National 
Petroleum Reserve in Alaska. This is an interesting one, cuts off 
interagency communication for oil and gas permitting.
  Historically, all of the agencies, when they were permitting oil and 
gas, like Bureau of Land Management, Forest Service, EPA, Fish and 
Wildlife Service, Army Corps of Engineers, would all work together in 
their permitting process and would all work together collectively in 
enforcing them. This legislation says they must all deal with the 
person separately, which makes it much more difficult to produce 
energy.
  I want to next bring up the next chart here. Total net U.S. petroleum 
imports. Prior to this energy bill, I believe it was called energy 
independence. Folks, the legislation we are going to consider this week 
will increase energy dependence. It will give us no independence.
  This shows you the study path of dependence. Many of us predict this 
bill put another spike here because it locks up good reserves, and it 
takes away what opportunities we have.
  It's vital to America that we produce fossil fuels.
  In my view, we ought to be opening up the Outer Continental Shelf, 
and I will talk about that in a minute, which is, for natural gas, I 
have a bill to do that, and I will talk about it in a few minutes. But 
we also ought to have a program promoting coal to liquids, because the 
Germans fought us in the war when we blockaded them and prevented them 
from buying energy, any oil. They made their energy out of coal. Their 
processes are still known.
  There are several processes that have been developed, but these 
processes need to be streamlined. We need to build some pilot plants. 
We need to make sure that in the future we are not growing our 
dependence to 70 and 80 percent on foreign countries.
  Interestingly enough, the Air Force is doing their own work. They 
have been experimenting with coal to liquid. They have been 
experimenting with natural gas to gas liquid, which would make natural 
gas prices even higher because there is not enough supply, because they 
don't want to be dependent in the Air Force. They use 2\1/2\ billion 
gallons of jet fuel a year, and they want at least at least 60 percent 
of that to be from American products. They can't do that today. They 
are dependent on foreign oil.

  The interesting thing we need to know, where does the foreign oil 
come from? Exxon is the 14th largest oil company in the world. The 13 
larger are government-run oil companies. Most of the companies like 
Iran, Iraq, Russia, Saudi Arabia, the government owns the oil company, 
owns the oil, opens the refineries, owns the marketing strategy, and 
even countries like nearby Mexico.
  We have all of these countries in the world. Most of the ones that 
are the big oil producers are not democracies. They are not 
particularly close friends of ours. There is much concern in the world 
today that 80 some percent of the known oil and gas reserves are opened 
by governments that are monopolies that own the whole shebang. They own 
it in the ground. They own the refineries. They own the marketing 
systems.
  Unfortunately, the fear is that Venezuela is going down the same road 
that Mexico went. Mexico has huge reserves, but they have always been a 
government monopoly. They don't put money back into the oil fields, and 
so today they can't produce enough of their own. We actually export oil 
and gas both to Mexico when they ought to be exporting to us and to the 
rest of the world because they have huge reserves.
  Because they are government run, they are corrupt. They steal from 
the oil reserves, money, and use it for other purposes and don't invest 
back. So their fields are so antiquated that they can't produce. There 
are many that are afraid today because in the last 3 or 4 years, three 
or four or five countries have taken over what were partly owned 
companies from the big oil companies, chased them out, taken over their 
equipment, taken over their refineries, taken over their operations, 
taken over their ownership, and they are now government-run monopolies.
  That's unfortunate, because they are doing the same thing that Mexico 
and other countries have done. They are not putting their money back. 
They have kicked out the smartest people in the country on how to 
produce oil, how to do refineries, how to produce the energy we need, 
and so there is great concern around the world that, as they continue 
to do this, their ability to produce will decrease and decrease, and 
the oil supply will be shorter and shorter.
  We sit here today with $78, $79 oil, $78.87, and we are storming the 
gulf away from probably $90 oil or any little blip in one of these big 
producing companies, and $100 oil. In fact, someone

[[Page H9540]]

was telling me today of a pipeline he was worried about that produces 2 
million barrels a day, and he said that pipeline is too long, in a very 
dangerous situation in the world. If it was blown up, we would have 
$100 oil in a couple of days.
  Should America be dependent on foreign, unstable countries, not 
democracies, not our friends, for the lifeblood of our country? I don't 
think so.
  Let's bring the chart back up on energy here. I am for all of these 
renewables. I want all the wind we can get, all the solar we can get, 
all the ethanol and biodiesel we can get, geothermal. Why we aren't 
putting more hydroelectric in because we have dams all over this 
country that have never had hydroelectric hooked up to them. We should 
be expanding nuclear.
  With the greatest coal reserves in the world, we should be force 
feeding coal to liquids and coal to gas mass. Now, some of the 
arguments I have had is, because of carbon sequestration, we can't do 
coal. Well, folks, we better do coal. We can work on the carbon 
sequestration as we refine the process of developing liquids and 
natural gas from coal.
  Now, natural gas, I believe, is our road to the future, for the 
immediate future. We have huge reserves of natural gas, Outer 
Continental Shelf. Let's bring that world map back up here or the 
United States map back up here again.
  We have huge reserves offshore. We only produce in the gulf, but we 
have huge reserves up and down the coast line.
  Now, I have legislation that will open up the Outer Continental 
Shelf, and it's vital that we do that. It's vital that we produce, 
because we, every electric generating plant we have built recently is 
natural gas. So if we continue to have a hot summer, we will use a 
tremendous amount of electricity. In hot weather, they turn on the gas 
plants, peaker plants. Before, 12 years ago, we only used natural gas 
for peaking plants. That was high use in the morning and high use at 
night, but where they were not allowed to run during the day, only in 
emergency.
  But then we took that restriction off, so now 98 percent of all the 
plants built in 12 years have been natural gas plants. They are 
cheaper, they are easier, but it's the most expensive electricity we 
are producing today. They are 22 percent of the volume, and they are 55 
percent of the cost of electricity, because natural gas is so much 
higher than it used to be, because we have not produced natural gas in 
adequate numbers. But if we produced our offshore, if we continued to 
produce more in the West, we could bring natural gas prices down so we 
are not the highest in the world.

                              {time}  2315

  When Dow Chemical moved its big plant to Saudi Arabia that they are 
building right now, they didn't want to do that, but their natural gas 
bill went from $8 billion per year to $22 billion per year and 
continues to rise; $8 billion to $22 billion. Nobody talks about that.
  Clean, green natural gas, it heats 50-some percent of our homes, 60-
some percent of our businesses. It is used to make ethanol, it is used 
to make biodiesel, it is used to make hydrogen, and it could be fueling 
one-third of our vehicles. And if we did that, because you can burn 
natural gas in a gasoline engine. You have to use a different fuel 
system, but it is just a change. We know how to do that. But it has to 
be affordable, there has to be financial incentives there, and so we 
need to do that.
  But the unfortunate part is America is just kind of going along like 
we have always had cheap energy. And I sometimes get angry at Congress 
and I get angry at the administration because energy has not been as 
high a priority as I think it should have been. But then 6 years ago, 
we had $2 natural gas and we had $10 oil; the world was awash in it. 
The only concern people had was we were importing too much of it from 
foreign countries and we weren't producing our own. But as cheap as it 
was, it didn't really matter.
  But we are a long way from $2 natural gas and $10 oil. The average 
price of natural gas to the home last year was $12.50 per thousand and 
the current price of oil is almost $79, and expected to go higher.
  So it seems to me that there would be a sense of urgency in this 
Congress and that legislation that we would be looking at this week 
would really deal with availability and affordability of energy. But, 
unfortunately, people keep saying that renewables must take over. Well, 
I wish they could. I am for them all, clean renewables. But clean, 
green natural gas can really bridge us until we have renewables playing 
a more significant role, until we have some new break-throughs.
  My legislation to open up the Outer Continental Shelf will allow the 
first 25 miles to be locked up by law. Today, we are locked up for 200 
miles. We are the only country in the world that I know of that has 
locked up the Outer Continental Shelf, and that is from 3 miles to 200 
miles; that is considered our territory to produce. Everybody, Canada, 
Norway, Sweden, Denmark, these are pretty green countries, New Zealand, 
Australia. They all produce there.
  Everybody talks about Brazil being energy independent. They are, 
because of ethanol. But it is not just ethanol. Ethanol was just a 
little piece of it. They also produced energy on their Outer 
Continental Shelf, and they don't now depend on anybody else for 
energy.
  Unfortunately, we can't ever get there. We will always be dependent 
on foreign countries for energy. There is no way America can be self-
sufficient, but we sure ought to be trying. We sure ought to be moving 
in the right direction instead of continuing to be more dependent. We 
are now 17 percent dependent on natural gas. Thank God for friendly 
Canada to the north. They produce about 15 percent, and we get about 2 
percent of LNG. That is liquefied natural gas. That is another whole 
issue. I am not opposed to it. It is very expensive. You have to build 
new sending ports, you have to build huge sending ports, you have to 
build huge receiving ports that nobody wants; and there has been great 
resistance to that. And you have to build the biggest ships known to 
man to bring that natural gas here.
  But, again, we are buying it from foreign, unstable, nondemocratic 
countries. Some say, it is okay for emergency, but don't we have enough 
of that? But clean, green natural gas, if we produced, opened up the 
Outer Continental Shelf, my bill, 25 miles remains closed; the second 
25 miles, States' rights. They can open it if they choose to. The next 
50 is open, but the States still have a say. If they don't want it 
produced, they can pass a law that their Governor signs that keeps them 
in the moratorium. And then the second 100 miles would be open.
  Now, I would like to open it for oil because I think we should, but 
we haven't been able to pass clean, green natural gas. A natural gas 
well has never polluted a beach. A natural gas well has never polluted 
anything. It is a simple six-inch hole drilled in the ground with a 
steel casing put in behind it and the pipe is rigged up to allow 
natural gas to flow into a system.
  Offshore, if you are past 25 miles, you will never see it. You only 
can see 11 to 12 miles. It will never be seen. You will never know it 
is there. And you can check with the people in the gulf, the best 
fishing in the gulf is where we produce gas and oil. The fish are 
attracted to the rigs. It helps make new reefs; it helps make barriers 
to protect them. It does not hurt aquatic life. In fact, it is probably 
the most environmentally friendly place to produce energy, and we as a 
country have said we are not going to do that. We are not going to 
produce energy there. In fact, we are not going to produce energy at 
all if we can help it.
  The bill before us this week will restrict the production of energy 
in a whole lot of ways. I have already listed them. And that is very 
unfortunate for America, because there is a lot of incentives for 
renewables. But if you double wind from one-sixteenth of a percent, you 
now have one-eighth of a percent for energy. That doesn't change much. 
That doesn't really change anything.
  And solar, we keep hoping for break-throughs, but it is even a 
smaller fraction. And geothermal is a big expense, and it is usually 
done with new construction. But in my country, I find out that when it 
gets below 10 degrees or 15 degrees into really hard, cold winter 
weather, it doesn't work well

[[Page H9541]]

enough and people start looking for other kinds of heat.
  Let's have the chart here on my bill. The NEED Act is the bill we 
hope we can amend into the energy bill. It would open up the Outer 
Continental Shelf for gas only. And we do some things here that we 
think are important. States will get 37.5 percent. That will be up to 
150 billion. That is with the known reserves. And we have never done 
modern seismographic out there, so most people who produce oil figure 
there is three times as much out there than we think because the old 
seismographic of 40 years ago wasn't very good and today we have much 
more sensitive seismic that will tell us exactly what's out there.
  We are going to give 100 billion to the government for the Treasury; 
$32 billion will go into a fund for renewable energy that will help us 
promote the renewables of the future; $32 billion will go into carbon 
capture and sequestration research, because there are those who 
determined that we must capture carbon. I am not sold totally on that; 
I am still somewhat skeptic, but let's provide the money so we can 
capture the carbon and we can produce energy without putting carbon in 
the atmosphere if that is what they believe to be correct.
  We put $20 billion to clean up the path of the Chesapeake Bay, the 
exact amount of money they say they need to clean up the Chesapeake 
Bay; $20 billion to restore the Great Lakes, exactly what they said 
they needed to restore the Great Lakes; $12 billion for the Everglade 
restoration; $12 billion for the Colorado River basin restoration; $12 
billion for the San Francisco Bay restoration; and $10 billion for 
LIHEAP and weatherization, which we have to fund because energy prices 
today are forcing people out of their homes.

  I come from rural America. We have big old farmhouses, and people 
hate to leave their original farmhouses. Some of them, their parents 
and their grandparents were raised there. They like it there, they are 
comfortable there, it is a nice location. But they are hard to heat. 
They are big old plank houses, they are not built like houses today, 
and it takes a lot of energy to heat them. And people, with today's oil 
prices and natural gas prices, are forced out of their homes. That 
shouldn't be in America.
  With the energy prices that are facing us this year, this winter, by 
the time Americans drive their vehicles with possibly $3.50, $4 
gasoline, and very high gas and fuel oil to heat their homes, they will 
be choosing between being warm, having adequate food, and other staples 
of life. I know last winter, which was a very mild winter in my area in 
Pennsylvania, up until January and then it was very, very cold from 
January 15 on for about 3 months; but overall, it was considered a mild 
winter because the first half was very mild. I know people that kept 
their homes at 58 degrees. Seniors in America shouldn't have to live in 
a 58-degree house. That is not how it ought to be. They ought to be 
able to afford to heat their homes.
  And the tragedy is if we were allowed to produce, if this Congress 
would stop locking up the Outer Continental Shelf, if they would open 
up the reserves in the Midwest which some of them are taking off in the 
energy bill, we could have adequate natural gas in this country; the 
price could be affordable; Americans could be warm; and, the very best 
jobs in America like petrochemical and polymers and plastic and 
fertilizer and glass and steel plants and bricks could be made in 
America, and middle-class working Americans could continue to have the 
jobs that have historically allowed them to live a quality of life and 
raise their families.
  Natural gas and energy prices overall are going to change the 
American economy. We are right on the verge of how much this economy 
can absorb. I was talking to someone who has worked on this all their 
life. They said they are astounded that $70 oil has not stalled our 
economy. They are just holding their breath because they know it can't 
get much higher without stalling our economy and putting our economy 
into a recession and possibly a world recession. These kind of energy 
prices.
  America has to get busy. China is building coal plants weekly, 
nuclear plants monthly, building the largest hydro dams in the world 
and cutting deals all over the world for gas and oil and coal. They are 
out there because they know, like so many other countries know, energy 
is scarce today, it is high priced, and they have to be about securing 
their future.
  This Congress has been negligent year after year in dealing with 
energy, and here we are now facing an energy bill that is actually 
going to move us backwards. The Pelosi energy plan has no energy in it. 
In fact, it takes energy out of the supply stream we have today and 
will force dependence up on foreign unstable parts of the world, with 
false hopes that we can conserve.
  And I am for conservation. I am for all of the better light bulbs and 
more efficient appliances and all the things and more efficient cars. 
All of those things. But they move the pendulum very slowly. New CAFE 
standards take 10 to 15 years for the new fleet to fully be here. All 
of these other appliance changes, it is only when a person buys a new 
appliance does it impact. And I know people who have refrigerators that 
are 15 and 20 years old, and until they replace that they are using an 
older, wasteful refrigerator.
  Folks, we need to have energy as the number one issue facing this 
Congress, energy availability and affordability. We became the 
strongest Nation in the world because we were the first to discover 
oil, harness oil, and give us an energy source that started the 
Industrial Revolution. The whole transportation revolution came from 
this country because we produced energy. We are choosing today to not 
produce energy, and we will fritter away, we will become a second rate 
nation in a very few years if we continue the wrong energy policy. And 
if we pass the energy bill that we are going to be facing on Friday, I 
believe we will increase dependence quickly, we will actually cause 
Americans to be forced to move out of their homes in the near future, 
not be able to live in the homestead because they can't afford to heat 
it.
  We will continue to force millions of jobs overseas as we have in the 
past. Chemical plants have been built overseas in the last few years; 
they will continue to be rebuilt overseas. They can't move quickly, or 
they would have already been gone. It is a $2 billion, $3 billion, and 
$4 billion investment to build a small chemical plant, and $10 billion 
and $20 billion to build a large one. Folks, they are in the process of 
doing that.
  We now make 50 percent of our fertilizer offshore. In fact, the 
ethanol issue is an interesting one, because we are taking food stock, 
corn. And to grow the corn, we have to have lots of fertilizer. It 
takes a lot of fertilizer to grow corn. And 50 percent of the 
fertilizer that we are using to grow corn is coming from foreign 
imports. Does that make any sense? I don't think so. Because clean 
green natural gas can solve all those problems.
  I look at natural gas as the clean fuel that bridges us to the 
future. No NOX, no SOX, a third of the 
CO2 if you are worried about CO2. And why the 
environmental groups are against clean green natural gas, I will never 
know, because some of the renewables are not nearly as clean as clean, 
green natural gas.

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