[Congressional Record (Bound Edition), Volume 147 (2001), Part 2]
[Senate]
[Pages 2209-2223]
[From the U.S. Government Publishing Office, www.gpo.gov]



                        NATIONAL ENERGY SECURITY

  Mr. MURKOWSKI. Mr. President, I am going to be introducing today 
legislation which has been forthcoming for some time. The legislation 
is the specific energy bill that has been worked on by a number of my 
colleagues and professional staff on the Energy and Natural Resources 
Committee. As a consequence, what we have here is a comprehensive bill 
that will be introduced twice because one version will go to the Energy 
and Natural Resources Committee and that will be titles 1-8; and 
another version with the entire text, titles 1-9, will be referred to 
the Finance Committee.
  Mr. President, this legislation is sponsored by myself and Senator 
Breaux. It is bipartisan legislation. Included as original cosponsors 
are Senator Lott, Senator Voinovich, Senator Domenici, Senator Craig, 
Senator Campbell, Senator Thomas, Senator Shelby, Senator Burns, and 
Senator Hagel.
  The purpose of the bill specifically is to protect the energy 
security of the United States and to decrease America's dependence on 
foreign oil sources to 50 percent by the year 2001 by enhancing the use 
of renewable energy resources, conserving energy resources, improving 
energy efficiency, increasing domestic energy supplies, improving 
environmental air quality by the reduction of emissions from air 
pollutants and greenhouse gases, and decreasing the effects of 
increases in energy prices on the American consumers as well.
  I would like to talk at some length this afternoon on what comprises 
this particular legislation. I am going to be referring specifically to 
the items in the comprehensive energy bill which is the National Energy 
Security Act of 2001.
  I think it is fair to say we all have taken energy for granted for 
far too long. Yet now, with a weakening economy, increasing energy 
costs, and regional shortages, we are much more aware of the reality 
that we have really not had a real energy policy for most of the last 
decade--something we just took for granted--and suddenly we are seeing 
the spirals, we are seeing the shortages, and we are becoming 
concerned.
  I think it is also fair in most cases to understand that energy is 
one of those nebulous things that is really so important that it is 
often overlooked. It grows our food, heats and cools our homes, and 
powers our electronic world. It is really what keeps us alive.
  We have fought over energy. We just came back from the Persian Gulf 
war. Wars have been fought over energy. Billions of dollars are spent 
just to ensure that we have access to energy in various forms.
  Our continued economic prosperity depends on a clean, secure, and 
affordable energy supply. It is for this reason that I rise today to 
introduce the National Energy Security Act of 2001.
  What we put before the Senate today is a balanced portfolio of energy 
options, and to begin debate on these important issues.
  Let me advise the President that by no means is this intended to be 
the package necessarily of comprehensive energy legislation that will 
ultimately come out of the committees of jurisdiction--the Energy and 
Natural Resources Committee and the Finance Committee--and onto the 
floor.
  The purpose of the legislation is so that we can begin the debate on 
the important issues to determine just what kind of energy policy we 
should have in this country.
  I should also mention that this particular legislation as proposed 
does not have the input of the new administration. They have only been 
in office for about 5 weeks. It is my understanding that an energy task 
force has been put together, by the order of the President, with the 
responsibility given to Vice President Cheney. They anticipate having 
an energy policy developed within 45 or 60 days. Undoubtedly, the input 
from the administration is going to be a necessary additive to the 
ultimate debate, and legislation will be forthcoming.
  During the last decade, the United States has lost control of its 
energy future. At no time in our history have we relied upon others for 
more of our energy supplies while producing a smaller percentage of the 
energy we consume.
  Ten years ago, the U.S. imported less than half of the oil it 
consumed; today, that has increased to nearly 60 percent. Meanwhile, 
other types of energy have been made more difficult to produce, more 
difficult to deliver, and more difficult to use.
  The rapid growth of the Internet and the ``dot-com'' economy during 
the 1990s led to significant increase in demand for energy. Yet, 
despite this increase in demand, domestic production of all forms of 
energy has remained flat over the last four years.
  The impacts on the American consumer have been clear: higher energy

[[Page 2210]]

prices, less economic growth, and less prosperity for all.
  We can take a lesson from history. The lack of a coherent energy 
policy has led to the greatest energy price volatility since the energy 
crises of the 1970's.
  For much of the past two years, global supply of crude oil has been 
nearly equal to global demand. As a result, crude oil prices have 
increased from $8.50 two years ago to near $30 today. We have seen the 
domestic development of oil in the United States drop proportionately. 
It is rather interesting to note, however, the development of the OPEC 
cartel and the discipline that has been evidenced by that group in the 
last several months as they have dropped the supply from time to time 
to ensure that the price remains between that ceiling and floor of $22 
to $28, and by controlling production they can keep that price range.
  Last summer, consumers faced gasoline price spikes in the Midwest as 
refineries were unable to keep up with demand. Gas prices over $2 per 
gallon were the norm.
  As refineries were operating at capacity to produce gasoline, they 
were unable to produce the heating oil we needed for the winter. We 
faced a heating oil shortage, particularly in the Northeast.
  Many consumers turned to natural gas to meet their winter heating 
needs, but expansion in gas-fired power plants has strained supply. 
We've seen natural gas prices increase from $1.80 per 1,000 cubic feet 
two years ago to over $10.00 in recent weeks.
  And most recently, we've seen the consequences of inadequate 
electricity supply in California--no new power plants in 10 years--
blackouts, elevators stuck, traffic lights off; and schools, fertilizer 
plants, plastic and computer chip makers were all affected.
  Fertilizer plants refuse to make urea. They are now selling it. Urea 
is a by-product of gas. We are seeing aluminum companies, rather than 
produce aluminum, sell their electricity.
  All of these energy ``crises'' have a common cause: Supply of energy 
simply isn't keeping pace with demand in spite of our efforts at 
conservation.
  With the economy on its longest joyride in history, policy makers 
chose not to check the fuel gauge. Our tank now almost empty, and our 
economic engine is sputtering. It is time to make tough choices. Add 
fuel to the tank.
  The time has come for a sound national energy policy--one that uses 
the fuels of today to yield the technologies of tomorrow.
  Our national energy plan--the National Energy Security Act of 2001--
has at its core three fundamental goals:
  Increased supply of conventional fuels--oil, coal, gas, nuclear.
  We do it more efficiently and with the latest technology that 
provides cleaner utilization of these sources of energy.
  Second, improve energy efficiency and conservation. We have the 
technology for clean coal. We have the utilization of nuclear. We just 
need to address what to do with the waste.
  Third, expand the use of alternative fuels and renewable energy. We 
have this capability. Unfortunately, renewables and alternatives take a 
very small percentage of our energy mix--less than 4 percent. We have 
spent some $6 billion in research. We are going to have to spend more. 
But we simply cannot rely on alternatives and renewables. We have to go 
back to the basic sources of our energy--our oil, our coal, our gas, 
and our nuclear.
  What does this legislation do? Some have called this an ANWR bill, 
but it is far more than that. I will talk about that a little later. 
But I hope my colleagues will look closely at this legislation and see 
that it is an attempt to have a balanced approach to meet our energy 
needs.
  These new programs and incentives will help us to find, develop, 
deliver, and conserve all our domestic energy resources. In doing so, 
we will reduce our reliance on foreign oil to less than 50 percent by 
the year 2010 to protect our energy security. That is a goal of this 
legislation. It will not eliminate our dependence, but it will simply 
reduce it.
  How do we do that? We do that by an expansion of our conventional 
sources of energy--our coal, our oil, our natural gas, and our nuclear, 
and using our technology to achieve it. Our objective is to provide the 
energy our economy requires for continued growth.
  Again, we can improve the environmental quality of these fuels by 
investing in advanced research and development programs and providing 
tax incentives for developing new, cleaner, more efficient 
technologies. We encourage new investment in energy infrastructure, 
transmission lines, natural gas pipelines, and drilling equipment. By 
doing so, we get the best technology out of the market. We have that 
technological capability, and we take steps to ensure the reliability 
of the Nation's electric power supply so critical for today's new 
economy.
  We also provide new programs and incentives to expand the supply of 
renewable energy at home and alternative fuels in our automobiles.
  A robust domestic energy industry--both fossil and renewables--helps 
to keep energy prices stable and affordable. I think you would agree, 
Mr. President, that is good business. And it is good for the consumer. 
But it is more than just supply.
  Our legislation is not only about supply, as some would have you 
think. We also focus on using energy more efficiently.
  Our legislation expands funding for the weatherization and LIHEAP 
energy assistance programs. It provides assistance to lower monthly 
energy bills and protects consumers and low-income families. We 
encourage State and regional energy conservation programs to minimize 
the effects of regional shortages in energy supply like the kinds we 
have recently seen in California.
  This legislation includes several new incentives for energy-efficient 
homes, appliances, and vehicles to conserve energy resources and 
improve efficiency.
  Finally, we provide new incentives for emerging distributed energy 
technologies that can provide reliable energy for business needs and 
combined heat and power technology to use waste energy more efficiently 
as space heating.
  This new national energy strategy makes good economic sense. It 
protects consumers and low-income families against higher monthly 
energy bills. It reduces the likelihood of price spikes that can wipe 
out a company's profits or a family's savings overnight. It keeps the 
heat and lights on for the Nation's factories, homes, and businesses, 
and maintains economic growth.
  It is also good from the standpoint of the environment. It makes good 
environmental sense, with cleaner, more efficient use of energy using 
new technologies and fewer air pollutants and greenhouse gases.
  The ``wild ride'' in energy markets over the past 2 years has made 
our energy challenge very clear: We need to establish a sound national 
energy policy to ensure clean, secure, and affordable energy supplies. 
This policy must use all our fuels--fossil and renewables--to meet 
those needs, as well as conservation and alternatives.
  The legislation we have introduced today is the first attempt to 
articulate the elements of a sound national energy strategy. Other 
elements we must also address separately are access issues, regulatory 
reform, nuclear waste, and climate change. But we must start now. I 
look forward to working with the President and my Republican and 
Democratic colleagues to enact this legislation into law.
  This morning we opened this effort with a press conference. It was 
rather interesting to note some of the questions that were posed 
relative to the legislation Senator Breaux and I, along with Senator 
Lott and others, have introduced.
  There was the question of, how much is this bill going to cost? 
Unfortunately, the Joint Tax Committee has not given us a figure. We 
expect that within 10 days. But it is a lot cheaper than not doing 
anything, if you will. And that is where we have been for far too long.

[[Page 2211]]

  Another question was about, how important is the ANWR, the Arctic 
National Wildlife Refuge? Developing a national energy strategy is 
really a team effort. ANWR is one of the best players on that team 
because it is the one area where the geologists have said there is 
likely to be a major oilfield of gigantic proportions, somewhere in the 
area of 10 billion barrels and perhaps as much as 16 billion barrels. 
What does that mean? Well, 16 billion barrels would be what we would 
import from Saudi Arabia for a 30-year period of time. We do not 
believe we can afford to leave that source on the sidelines. We believe 
we have the technology to do it safely. Some have asked, how will this 
bill provide relief in California? There is certainly no immediate 
solutions to the California situation. California, unfortunately, 
became dependent on outside sources. I think there is a bit of a 
parallel there. I understand California is currently importing about 25 
percent of its energy from outside the State. As a consequence, 
California has become vulnerable because they have not developed their 
own sources of energy. They prefer to buy it from other States that 
have surpluses.
  Without going into the inefficiencies of deregulation--which was 
really not a true deregulation when you maintain a cap on retail 
prices--it is fair to say there is a situation where, in the sense of 
our increased dependence on imported oil, we are too dependent on 
outside sources. As a consequence of that, I think we are certainly 
vulnerable to price hikes for oil as well.
  So I think that as we look at the California situation, we should 
recognize the exposure we have here in the United States on our 
increased dependence on oil, which is about 56 percent.
  The question came up: What comments have we gotten from the 
administration? President Bush recognizes the need for a national 
strategy. Vice President Cheney has been leading a task force to 
develop their own initiatives. It is my understanding that effort is 
going to be completed in about 45 days. So we look forward to 
incorporating their comments into our ongoing work at the appropriate 
time.
  We have had meetings with our colleagues over in the House, 
Congressman Tauzin and Congressman Barton. And we have had a very 
positive response relative to the manner in which we hope to bring this 
legislation through the House and Senate.
  Now, when will we have a vote on this? Obviously, it is going to the 
committees of jurisdiction for hearings--the Energy Committee and the 
Finance Committee. But what we wanted to do is get the debate started 
on the entire bill so we can move through the committee process and, 
hopefully, to the floor at a later date.
  Some have said this bill calls for more nuclear power, and will this 
require an accelerated program for nuclear waste storage? We need to 
use all our domestic resources. Inasmuch as nuclear contributes about 
20 percent of the total electric energy in this country, it is 
important that we continue our efforts to try to resolve what to do 
with the nuclear waste.
  As you know, Mr. President, we were one vote short in the last 
Congress of overriding a Presidential veto. The difficulty with the 
nuclear waste issue is no one wants the waste. As a consequence, as we 
pursue our efforts in Nevada to develop the Yucca Mountain site, there 
is a noted lack of support from the Nevadans.
  That is understandable, yet that waste has to go somewhere. As we 
look at some of the technology that has developed over the years, we 
find the French have addressed, through the vitrification process, the 
recovery of plutonium, putting it back in reactors, burning it, and 
basically getting rid of that proliferation. We don't seem to be able 
to do that in this country. Maybe we should give more thought to it.
  There has been a question brought up about providing some short-term 
changes such as increasing CAFE standards in the legislation. We think 
we have addressed this because we have, as far as CAFE standards, put 
the burden on the Federal Government to have its vehicles pick up about 
3 additional miles to the gallon, and that is a good place to start 
before we dictate to the American public any mandates with regard to 
this. It is fair to say that if it works for the Government, then the 
Government ought to lead the way.
  There are some other points I will bring to the attention of the 
Senate at this time relative to the state we are in. This came about as 
a release last week from the Center for Strategic and International 
Studies, a well-renowned defense and foreign policy think tank here in 
Washington. It includes scholars, both moderates and conservatives, 
from both parties, and their conclusion in a three-volume, 3-year 
effort entitled ``Geopolitics of Energy into the 21st Century.''
  The new study predicts that the U.S. and other industrial nations 
will become increasingly dependent on oil from the Middle East in the 
next 20 years and will need the region's most unstable countries--Iran, 
Iraq, and Libya--to raise their output. I wonder, at what price to the 
U.S.
  Furthermore, I refer to a Wall Street Journal article on February 15 
and an AP article of February 14 on the same subject, indicating that 
global demand will grow sharply over the next two decades. The oil will 
come from areas with increased risk of supply interruptions. Further, 
it states, by 2020, half of all petroleum used by the world will be met 
from countries that impose a high risk of internal stability. World 
energy demand will increase by 50 percent, and at some point developing 
countries, led by China, will begin to consume more energy than the 
developed countries.
  Mr. LOTT. Mr. President, if the Senator from Alaska will yield, I 
came to the floor to commend and congratulate the distinguished 
chairman of the Energy and Natural Resources Committee for his work on 
this very important legislation. It is overdue. It is very broad, 
comprehensive legislation that is designed to address this problem. I 
think he should be recognized for the effort he has put into it.
  This is a bill that has been developed in a bipartisan way with all 
different views and regions of the country reflected in various 
components of the bill. I acknowledge that.
  I ask the Senator, when does he expect there will be some input from 
the administration, and how does he plan to proceed in terms of 
committee hearings and when he might actually get legislation ready for 
the Senate to consider?
  Mr. MURKOWSKI. I appreciate that inquiry. As I believe the leader 
recalls, the President has appointed Vice President Cheney to form a 
task force developing an energy policy for the administration. That 
task force has been at work for some time. My understanding is they 
should have this ready in about 45 days.
  I am most appreciative of the Senator's cosponsorship, along with 
that of Senator Breaux. This is a bipartisan package. It will go to the 
two committees of jurisdiction--the one I chair, the Energy and Natural 
Resources Committee, and the other is the Finance Committee. We will 
begin hearings as soon as I have had an opportunity to sit down with 
Senator Bingaman and find some mutually compatible dates. We intend to 
move on this and get the debate started because, as the Senator knows, 
it is a very comprehensive piece of legislation. There is going to be a 
lot of input into it. There are certain things we have to get done, and 
we need an estimate from Joint Tax.
  This legislation is meant to stimulate new technology, to provide 
incentives for the small independents, the stripper wells, so we can 
keep those people going when the prices decline. It is not addressed to 
the large oil companies that can fend very well for themselves.
  Mr. LOTT. I thank the Senator for his response. I asked so I could 
have some plan as to when we might bring it to the Senate. I hope that 
certainly in June or July of this year we would be able to get to it.
  Let me ask the Senator another question. I don't want to take up all 
of his time. I would like to have some brief time to make some remarks 
of my own. I believe we are importing now 56 percent of the oil needs 
of this country.

[[Page 2212]]


  Mr. MURKOWSKI. That is correct. The largest increase is now coming 
from Iraq, from Saddam Hussein. Remember, we fought a war over there in 
1991.
  Mr. LOTT. That is right. When I go around the country, I find there 
are a number of States with additional oil that could be used if we 
could get it out of the ground. It is not being used. There are a lot 
of areas of the country, such as my own, where we have a substantial 
supply of natural gas but there has not been an incentive or incentives 
for us to convert to natural gas, which is clean burning and has been a 
cheaper source of energy, even though, because of all the demand, it 
has been going up.
  I found, when I was in Kentucky last week, there is substantial 
progress being made in clean coal technology that we could make better 
use of coal. In my own State, we have a nuclear plant but no place to 
put the nuclear waste. When I go out west, I see other sources being 
used. Wind is one example. The list is endless of the potential we have 
in this country. Yet we are not using it.
  I wonder if the American people think we have a shortage of energy 
supply. I ask the distinguished chairman of the Energy and Natural 
Resources Committee, do we have a shortage? If we don't, why are we 
importing 56 percent of our energy needs from the OPEC countries of the 
world? I think this is totally indefensible.
  Mr. MURKOWSKI. I think our national energy security interest is at 
risk. We fought a war over there to keep Saddam Hussein from invading 
Kuwait or going into Saudi Arabia. At what point do we compromise our 
national security? I think if we see fit to fight a war over it, it is 
pretty important. As the Department of Energy predicts, in the year 
2006 or 2007, we will be in the high 60s, 60-some-odd-percent dependent 
on imports.
  We have tremendous reserves in the Gulf of Mexico. We have reserves 
in the overthrust belt in my State of Alaska and tremendous resources 
of natural gas in Mississippi and Alabama, Texas, Louisiana. We have 
these resources. We have the technology to develop them safely. We have 
had a difficult time, perhaps, convincing the environmental community 
that we can make a smaller footprint. We can do a better job. And we 
have the American ingenuity and commitment to do it, if given the 
opportunity.
  Many of these areas have been closed for exploration and development.
  Mr. LOTT. Mr. President, as I go around the country and around my own 
State, more and more people are bringing this subject up to me. People 
are complaining about gasoline prices. They are complaining about their 
electricity bills or their natural gas bills. Out in the real world 
people seem to be concerned about it and mad about it, but when I come 
back here, I don't get the sense of urgency. In fact, there are a lot 
of people who seem to think all we need to do with our energy problem 
is provide more incentives to weatherize our houses, which is fine, and 
provide more money for the Low Income Home Energy Assistance Program, 
money that we give to low-income individuals to meet their heating and 
air-conditioning costs.
  Now, I emphasize that while those are both fine in this bill, they 
are not an energy policy. The answer to the energy shortage is not for 
the Federal Government to pay the additional cost of not having an 
adequate supply.
  So I commend the Senator for including those provisions in his bill. 
It is comprehensive. He has more incentives for exploration and 
conservation, for alternative sources, and for low-income needs. I look 
forward to us actually getting to the floor and having a full debate 
and amendments.
  If we complete this year not having passed a major national energy 
policy bill, it is going to be a big mistake, a tragedy. I think it is 
the biggest threat to our future economic prosperity. If we don't do 
this now, we could be in danger because there won't be the power to run 
Silicon Valley or new automobile manufacturing plants or anything else. 
There will be shortages, and that will be a mistake for our future 
economy.
  I thank the Senator for yielding. I wanted to engage in a little bit 
of a discussion about when we are going to take this up.
  Mr. MURKOWSKI. Mr. President, I appreciate the remarks of the 
majority leader. I thank him for his commitment and enthusiasm to make 
sure this legislation is of the importance that it obviously is as we 
look at the situation in California. We just recognize, for example, we 
have huge resources of coal in this country--huge resources. We have 
the technology to clean that coal and reduce emissions. We haven't 
built a new coal-fired plant since the mid-1990s. Why? We could not get 
a permit, for all practical purposes. All the emphasis has been on 
natural gas.
  If you are going to generate electricity, you get natural gas. It is 
becoming short in the sense that our reserves that are attainable are 
being pulled down very rapidly. So we are going to have to find, if you 
will, new reserves. We have the Gulf of Mexico, with the technology, 
drilling in 3,000 to 6,000 feet of water. While there is a risk 
associated with that, they have new technology virtually reducing that 
risk to a large degree, so it is manageable. I think we have to 
convince our environmental friends we do have the technology to make 
the footprint smaller, to do a better job, and to get on with the 
reality that we can't conserve our way out of this energy crisis. We 
have to simply produce more energy and sustain ourselves with new 
technologies, renewables, alternatives, and we have to conserve.
  Nevertheless, when you talk about solar panels, in Alaska, sometimes 
it gets dark in the winter for a long time. The wind doesn't always 
blow like it does in Washington, DC, or sometimes in this Chamber. 
Nevertheless, when you and I leave here, we have to have jet fuel in 
that airplane, not hot air. I think it affords us the responsibility 
that we have to come up with some meaningful legislation.
  If the majority leader would care to speak at this time, I am happy 
to yield the floor on this matter. I would appreciate being recognized 
upon the conclusion of his remarks.
  Mr. LOTT. Mr. President, today's fuel prices are a daily reminder 
that America is now at the mercy of foreign oil producing nations. 
America's dependence on foreign oil directly threatens our national 
security and our freedom. However, before you blame your neighbor's 
SUV, your local fuel distributors, the oil companies, the automakers, 
or any of the other usual scapegoats, consider this fact--America is 
one of the leading energy producing countries in the world. This 
country has the technology, alternative resources and enough oil and 
natural gas to be much more self-sufficient. America does not have to 
revert back to the practices of the 1970s.
  This country is faced with a very serious problem. Our nation's's 
farmers are being hit hard--due to the cost of home heating bills, farm 
fuel costs, gasoline, and the impact of the crisis on the fertilizer 
industry. For obvious reasons, the transportation industry is also 
seeing a significant hit in air cargo and passenger transportation, 
intercity bus, trucking, and rail transportation. This in turn affects 
the tourism industry. Rising oil prices impact more than just energy 
costs. They are absorbed into a wide variety of goods causing a general 
increase in consumer prices. This cost increase threatens the engine of 
the nation's economy, our nation's small businesses.
  All of this is simply because of the lack of an energy policy. As a 
result, U.S. crude oil production is down significantly, as consumption 
continues to rise. America now imports over 56 percent of the oil it 
consumes--compared to 36 percent at the time of the 1973 Arab oil 
embargo. At this rate the Department of Energy predicts America will be 
at least 65 percent dependent on foreign oil by 2020.
  The National Energy Security Act of 2001, which we are introducing 
today, seeks an overall goal: To enhance national security by reducing 
dependence on foreign energy sources while protecting consumers by 
providing stable supplies at affordable prices. It provides incentives 
for the use of natural

[[Page 2213]]

gas--a fuel which can burn cleanly in internal combustion engines, and 
which is abundant within our own borders--especially in the Gulf of 
Mexico. It also calls on America to utilize other domestic resources 
through incentives which encourage the use of marginal oil wells, and 
the billions of barrels of oil we have in Alaska. Likewise, this 
measure does not ignore the use of renewable energy resources such as 
solar power, hydro-power, or wind power. However, Congress must 
acknowledge that America cannot realistically run only on renewable 
energy resources. Coal, oil, and natural gas remain our most abundant 
and affordable fuels, and they can be used in environmentally sound 
ways.
  Some 55% of the electricity generated in the United States comes from 
coal-fired steam generating plants. Coal can make a significant 
contribution to U.S. energy security, if the environmental challenges 
of coal-fired plants can be met. This legislation will provide credits 
for emissions reductions and efficiency improvements. It will also 
provide a tax credit on investments in qualifying system of continuous 
emission control installed on existing coal-based units.
  Congress must provide incentives for independent producers to keep 
their wells pumping, as well. Tax credits for marginal wells will 
restore our link to existing oil resources, including many in my home 
state of Mississippi. These wells are responsible for 50% of U.S. 
production.
  We also need to increase the availability of domestic natural gas, 
which is the clean alternative for coal in electric power plants. 
Federal land out West may contain as much as 137 trillion cubic feet of 
natural gas. Similarly there is Federal land in Alaska which is 
estimated to contain 16 billion barrels of domestic crude oil None of 
these facts should be surprising.
  There has to be a solution to this problem. Some would say that all 
we need to do is improve energy efficiency and reduce energy 
consumption. While there is a place for energy efficiency incentives in 
developing a natural energy policy, we must not starve our economy of 
the energy it needs to maintain and improve our standard of living. In 
the long run, a national energy policy that looks at all realistic 
sources of energy must be developed.
  This is not the 1970s, America has better technology, more efficient 
and cleaner automobiles as well as more energy options. The question 
is: How long will we forgo these options and be held hostage to nations 
abroad or extremists at home? Millions of Americans are enduring 
mandated power outages because of lack of power infrastructure or are 
stuck with bigger heating bills due to increased demand and limited 
production of energy. America must tap the vast resources we have. If 
not, those bills are just going to get bigger, and those outages will 
occur more frequently. America can solve its energy problems but 
Congress must act in the interests of the entire nation, rather than a 
select few. America badly needs a comprehensive, but realistic, 
national energy policy, and we need it now.
  Mr. President, again, as we have been discussing, today's fuel prices 
are a daily reminder that America is now at the mercy of foreign oil-
producing nations. America's dependence on foreign oil directly 
threatens our national security and our freedom. We need to think about 
that and recognize it.
  The situation we have seen in California is not going to be unique, 
and it is not just going to apply to the Midwest or the Northeast. This 
is going to be a national problem. It is going to affect our economy 
and our future security.
  When we have the possibility that Iraq can cut off part of our oil 
supply, and maybe involve other Arab OPEC countries, that is extremely 
dangerous. Yes, we have SPR, the Strategic Petroleum Reserve, but only 
enough for a few days--perhaps a few weeks--at which point we would be 
on our economic knees and in danger from a security standpoint.
  A lot of people want to blame something else: Oh, it is your 
neighbor's SUV; it is your local fuel distributors who are gouging you; 
or the oil companies are doing it because they want to make more money; 
or the automobile manufacturers can produce automobiles more fuel 
efficient. Perhaps they can, and I hope they will continue to make our 
automobiles better and more fuel efficient all the time, and they have 
been doing that.
  There are any number of scapegoats. Before we do that, we should stop 
and realize America has plenty of energy sources. It is just that we 
are not using them or getting them out of the ground, and we are not 
taking advantage of the alternative fuels the way we should. We have 
the technology. That is why I specifically mention this clean coal 
technology. I am sure the distinguished Senator from West Virginia 
could tell you about it. There is a plant over here in Maryland that is 
using, I guess, a forward-leaning experimental basis--clean coal 
technology. We should explore that to the greatest extent possible. 
That is a resource of which we have a large supply. It is all across 
the board. Yet there are many in this country who say let's just revert 
back to the 1970s; let's just go with conservation; let's not worry 
about supply. I think that is a problem.
  Our Nation's farmers are being hit hard. They are paying higher 
prices for farm fuel costs, heating bills, gasoline. That is affecting 
the fertilizer industry. For obvious reasons, the transportation 
industry is seeing a significant hit in air cargo and passenger 
transportation, intercity buses, trucking, and rail transportation. It 
has affected the entire economy already. Indications are--and perhaps 
the Senator from Alaska has already noted this--that the current oil 
price situation has already spiked up the CPI by four-tenths of a 
point. That is huge. But you don't have to be a rocket scientist to 
figure out how that would be happening because of the rising oil prices 
and the impact they have on energy costs across the board.
  It is affecting consumer prices, and small businesses are also being 
hit. All this is simply because of the lack of a national energy 
policy. We thought we confronted this problem back in the 1970s when we 
had the long lines at gasoline stations. Remember, I think they had 
marathon sessions here in the Senate. We took action and we thought 
that would not happen again. We didn't do enough. America now imports 
about 56 percent of the oil we consume compared to 36 percent at the 
time of the 1973 Arab oil embargo. At this rate, the Department of 
Energy predicts America will be at least 65-percent dependent on 
foreign oil by 2020. That is extremely dangerous.
  The National Energy Security Act of 2001, which we are introducing 
today, seeks an overall goal: To enhance national security by reducing 
dependence on foreign energy sources while protecting consumers by 
providing stable supplies at affordable prices. It provides incentives 
for the use of natural gas--a fuel that certainly burns cleaner than 
some of the types that we have now--where we have an abundance of it 
within our own borders, especially in my own area of the Gulf of 
Mexico. It calls on America to utilize other domestic resources through 
incentives which encourage the use of marginal oil wells.
  We have billions of barrels of oil that are available in these 
marginal wells and certainly up in the Alaska area. There are those who 
say: No, we can't open up ANWR or some areas on the west coast, areas 
on the east coast.
  We could have everything environmentally pure, but we may not be able 
to have the energy supplies we need to run this country or to heat our 
homes or fuel our farmers or our economy generally.
  We should also look at alternative sources such as solar power and 
hydropower, which is something we rely on in this country. We see a 
problem up in the Northeast, and because it has been a light year for 
rain and snow in the Northwest and in States such as Idaho, Oregon, and 
Washington, they have a potential problem there.
  Some 55 percent of the electricity generated in the United States 
comes from these coal-fired, steam-generating plants, as I have 
indicated. Coal is something we have an abundance of,

[[Page 2214]]

and with some more tax incentives, we can continue to make progress in 
coming up with new systems that will provide tremendous rewards for us.
  I understand the natural gas area we have in the West is as much as 
137 trillion cubic feet. It is estimated that we have 16 billion 
barrels of domestic crude oil in Alaska. None of these facts really 
should be surprising. We have known it, but we have not been serious 
about taking advantage of what we have there. We can do all this while 
protecting the environment.
  I realize this is something you can't apply to every situation, but 
in the Gulf of Mexico, an area I am familiar with regarding oil and gas 
exploration--I live right on the gulf. I look out on the Gulf of 
Mexico. It is a wonderful sight and one of the most peaceful things I 
do. I sit on my front porch in a rocking chair and look at those gulf 
waters to my left toward the Alabama State line.
  Not long ago, there was a natural gas well pumping away and doing 
fine. A couple of times they had to flare it, and at night it was a 
beautiful sight. They have done what they wanted to do with that well 
and have moved on.
  As Senator Murkowski has said, more and more of these oil and gas 
rigs are moving to deeper and deeper water. They drill now in such a 
way that they know what they are going to hit. They know where it is, 
and they can do it in 2,000, 3,000 feet of water. It is amazing 
technology.
  Have we ever had an incident in my home area? No, never have we had 
an incident with an oilspill at a rig or with natural gas. The most 
dangerous thing we have is a Chevron refinery. Big ships come in and 
have to offload on to smaller ships. They bring those smaller ships 
into the harbor and port and offload them at the refinery. They, too, 
have been successful in not having incidents that have caused 
environmental problems, but there is more of a risk bringing in foreign 
oil from big boats to smaller boats to the dock than there is to drill 
for oil and gas.
  Also, the best fishing in the gulf is around the rigs. Ask the people 
who live there. They will tell you it has been a tremendous boon to 
fishing. You catch the biggest fish right around the oil rigs off the 
coast of Louisiana and off the coast of Mississippi. This is a personal 
example.
  We can have oil and gas exploration, protect the fish and wildlife, 
and do it in an environmentally safe way. I hope we will develop this 
overall policy. We can pick it apart. Some people are going to say: Oh, 
no, we can't open up ANWR. It is always interesting to me that the 
people who say we cannot do it are the people who do not live there. 
The people who live there think we can do it and do it in an 
environmentally sound way.
  There will be those who object to that and maybe try to defeat it. 
Others will say we shouldn't give incentives to get these margin wells 
in operation. Others will say the Federal Government should not be 
involved in paying people's utility bills.
  If we pick it apart piece by piece, we will wind up with nothing or a 
skeleton, and we will not have a national energy policy. If we do that, 
I predict, today on this floor, within the next 5 years we are going to 
have a disastrous energy supply situation in this country. We have an 
opportunity to do something about it this year in a bipartisan way that 
will be good for every region of the country and every group that might 
have an interest in energy policy.
  I implore my colleagues in the Senate, and I call on this new 
administration: Let's step up to this. Let's not shrink from our own 
problems, desires, concerns, or knowledge. One thing that has always 
bothered me is if you know anything about a subject, if you know 
anything about energy, in this city you are disqualified; you have to 
be ignorant to decide what you need to do about the future energy needs 
of this country. That is a big mistake.
  We have an opportunity with regard to our children's economic future. 
From a security and freedom standpoint, we must do this bill. I look 
forward to bringing it to the floor of the Senate for consideration by 
all Senators.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER. The Senator from Alaska.
  Mr. MURKOWSKI. Mr. President, I yield 10 minutes to Senator Hagel.
  Mr. HAGEL. Mr. President, energy touches every facet of our lives. 
Energy is serious business. America must have a national energy policy 
that ensures we have a reliable, stable, and affordable source of 
energy. This cannot be neglected. To do so leaves our Nation vulnerable 
on all fronts.
  Energy policy ties together America's economy, our standard of 
living, our national security, and our geopolitical strategic interests 
around the world, and, of course, this Nation's future.
  We have entered a period where low energy supply has met high energy 
demand. Oil prices have tripled over the last 2 years, hitting a high 
last fall of nearly $40 a barrel--the highest price since the buildup 
to the Persian Gulf war in November 1990.
  Last Friday, the price of a barrel of oil was $29. This winter, 
California has endured severe disruptions in the supply of energy as a 
result of many factors, mostly a wrong-headed deregulation effort that 
left the market incapable of adapting to the imbalances between high 
demand and low supply.
  We are also seeing the impact of a combination of record high natural 
gas prices and a harsh winter. Consumers all across the country are 
being hit with double and sometimes triple the energy bills they had 
last winter. It is very difficult for many families to absorb this 
shock to their budgets, and they cannot go without heat. We have 
increased the Federal funding for the Low-Income Home Energy Assistance 
Program, LIHEAP, to assist families in the short term. But the real 
answer is a long-term change in policy.
  High energy costs ripple through the economy. Price spikes send a 
shock through the economy, increasing prices for everything that uses 
energy, and that is everything. They drive up inflation.
  An analysis last year by the Heritage Foundation found that high oil 
prices would cost the average American family of four more than $1,300, 
decrease consumer spending by nearly $80 million, and cost our economy 
almost 500,000 jobs over the next 2 years.
  In the United States, a slowdown in economic growth due to higher 
energy prices will have a negative impact on our Federal budget. The 
assumptions for projected Federal budget surpluses over the next 10 
years do not take into account what would happen if high energy prices, 
energy shortages, or energy rationing stalled our economy. Where then 
would be our proposals to finance new prescription drug plans for 
Medicare recipients, provide more funding for education, grapple with 
the restructuring of our entitlement programs, and much needed funds to 
improve our Nation's military? The money needed to fund these areas of 
our Federal budget and pay down our national debt would have gone up in 
smoke--literally gone up in smoke.
  Energy policy has broad national security implications for the United 
States because we are so reliant on foreign sources for our supply of 
crude oil.
  During 1973, at the peak of the energy crisis, we relied on foreign 
sources of oil for 35 percent of our domestic supply. Since that time, 
we have become more, not less, dependent on foreign oil. Today we 
import about 57 percent of the oil used in the United States. Petroleum 
accounts for one-third of the U.S. total trade deficit. Who are we 
kidding?
  Our reliance on foreign oil leaves the United States vulnerable to 
the whims of foreign oil cartels. Should something happen to threaten 
this supply, we cannot turn on the spigots in the United States 
overnight; we are literally blackmailed; we are literally captive to 
outside energy sources.
  A tight oil market gives additional leverage to individual oil-
exporting nations and tyrants. Half the world's spare production 
capacity right now is in Saudi Arabia. Iraq, whom we bomb by night and 
who imports oil by day, is now one of the fastest growing sources of 
U.S. oil imports.
  Our allies would be more vulnerable to threats from oil-producing 
nations

[[Page 2215]]

because they are even more dependent on foreign oil. America and its 
allies must never allow themselves to become political hostages of 
energy supplier nations. This could lead to international blackmail and 
dangerous, unpredictable world instability.
  We drifted through the last 8 years without an energy policy, content 
to sit back and enjoy a good economy and take credit for that economy, 
but unwilling to prepare our Nation for the difficult challenges ahead 
and make the hard choices necessary for energy independence.
  When this crisis arose last year, the Clinton administration had no 
solution or strategy for how to deal with the problem. The policies of 
the last administration served to discourage and at some points 
actually completely shut off domestic oil and natural gas production. 
Over the last 8 years, we have seen millions of acres of possible 
exploration areas for oil and natural gas completely taken off the 
table. While oil consumption in the United States has risen by 14 
percent since 1992, U.S. crude oil production has declined by 17 
percent. Over the last 4 years, 58,000 wells were shut down.
  What do we do about this? What can we do to address this problem? We 
must pursue a comprehensive energy policy that decreases our reliance 
on foreign oil by increasing the safe and environmentally sound 
production of our domestic oil and gas resources and by developing a 
more diversified supply of energy sources.
  We cannot wait for the next crisis to decide what we will do. Natural 
gas demand is estimated to grow by 30 percent over the next decade. 
Shutting off the lights and increasing efficiency won't begin to make 
up for the increased demand. We need a greater supply of energy.
  We must develop a national energy policy that meets the present and 
future needs of our country. I am pleased today to join Chairman 
Murkowski and my colleagues in introducing the National Energy Security 
Act. We must increase our production of energy.
  This legislation will help ensure an affordable, reliable, and 
diversified domestic supply of energy. We must also focus on becoming 
more efficient in our use of energy. Conservation is important. This 
bill will help make energy prices less volatile and alleviate the 
impacts that the wild price swings have on the national economy. It 
will reduce our reliance on foreign oil.
  The United States must seek to further diversify its energy resources 
portfolio. We must all learn the lessons of history and recognize that 
we should not be focusing our energy needs in one area but must have a 
diversity of sources of energy to meet those needs. The bill we are 
introducing today promotes alternative fuels for vehicles, it 
encourages the production of traditional sources of energy, and 
advances cleaner technologies for the future. It encourages the 
development of biofuels, geothermal, hydropower, clean coal, and other 
energy options. For the United States to protect itself from the whims 
of international oil cartels and tyrants, we must harness and develop 
as many of our renewable energy resources as possible. This bill also 
increases funding for LIHEAP by $1 billion to ensure that low-income 
families will not have to choose between heating their homes and 
feeding their families.
  And, yes, part of the solution includes opening the Arctic National 
Wildlife Refuge to exploration. Drilling in ANWR has been used to 
portray the Bush administration, and those who support opening ANWR to 
drilling, as anti-environment. What strikes me odd about that line of 
argument is that it is faulty. It is faulty for many reasons. One of 
the most important among them is that most countries from which we 
import our oil now have very little regard for the environment. You 
look at some of these foreign oilfields around the world and you see 
total destruction of the environment, no regulation, no laws, no 
respect for the wildlife and the land on which they drill.
  A study done by the Interstate Oil and Gas Compact Commission found 
that U.S. producers spend almost $3 billion annually, or roughly $2 a 
barrel, to comply with environmental regulation in the United States. I 
doubt that one-tenth of this is spent on environmental regulations in 
all the other oil- and gas-producing countries combined. Who is taking 
care of the environment and who is not taking care of the environment?
  So if environmentalists are truly concerned about the worldwide 
environment, it would seem to me they would want every possible drop of 
that oil and natural gas to be found in the United States to be pumped 
and drilled under safe environmental regulations imposed by State and 
local governments, the EPA, the Federal Government, the U.S. Fish and 
Wildlife Service.
  We are all concerned about the environment. We have led our Nation 
far too long without a comprehensive energy strategy. The President and 
Congress must immediately address America's need for a strong, defined 
national energy policy. It underpins our national independence. Energy 
independence underpins our national security, it underpins our economy, 
our standard of living, our trade, our role in the world, and the 
future for our children. Our Nation's future is directly connected to 
energy capacity. If we fail this great challenge, we will leave the 
world more dangerous than we found it. That is not our heritage. This 
will require bold, forceful, and intelligent leadership. We can do 
this. We will do this. This is America's heritage.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Alaska.
  Mr. MURKOWSKI. Mr. President, I thank my colleague from Nebraska for 
his candid statement, particularly when he focused on the lack of 
sensitivity in the oilfields of much of the world. Yet we depend on the 
oil coming from there. We don't seem to have any regard for how it is 
produced or the sense at this time of the environment. We take it for 
granted and somehow just ignore that we have the responsibility because 
we are addicted to foreign oil and yet we accept no responsibility for 
the environment. I commend him for that observation. I thought it was 
very pertinent.
  Mr. President, I ask unanimous consent that a list of the 
participants in the press conference on the National Energy Security 
Act of 2001, including the Campaign to Keep America Warm, Interstate 
Oil and Gas Compact, National Association of Regulatory Utility 
Commissioners, Small Business Survival Committee, National Association 
of Manufacturers, Association of Home Appliance Manufacturers, National 
Association of Neighborhoods, Fertilizer Institute, Edison Electric 
Institute, Printing Association, United States Combined Heating, 
American Gas, Washington Gas, Nuclear Institute, American Forestry 
Society, American Forests, American Institution of Architects, National 
Association of Home Builders, Air Transport Associates, Society of 
Independent Gasoline Manufacturers, National Association of Realtors, 
the Coalition for Affordable Renewable Energy, National Pumping and 
Heating, American Highway Users, National Restaurant Association, U.S. 
Oil and Gas Association, National Association of Convenience Stores, 
the National Refiners Association, the Independent Driver's 
Association, all who were in attendance and represented at the press 
conference where we discussed the introduction of this legislation this 
morning, be printed in the Record following my remarks relative to the 
introduction of this legislation. I also ask unanimous consent that a 
letter of support from the Teamsters be printed in the Record following 
my remarks.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (See Exhibit 1.)
  Mr. MURKOWSKI. Much has been mentioned of one facet of this 
legislation. I refer to the ANWR area. I also want to add that while we 
have not sought cosponsors, there have been many who have come to the 
floor today or have contacted me. As a consequence, I think it is 
important to add my senior colleague, Senator Stevens, even though I 
have not been able to contact him, so I condition that. But I don't 
want him to think we haven't thought of him. I add his name.

[[Page 2216]]

  I will identify on the first map, to get a feeling for ANWR and what 
it is all about, I will demonstrate what part of Alaska comprises ANWR. 
It is 2\1/2\ times the size of Texas. Nevertheless, it is a big, big 
piece of real estate. This area on top is called ANWR. It in itself is 
about the size of South Carolina. It is 19 million acres. Notable on 
this map are the colored areas which are Federal lands.
  The reason it is appropriate to reflect a little bit, I hear the 
quotation, why can't we have some area of wilderness that is as it 
always was, with no footprint of any kind? And the justification of 
ANWR, indeed, is it fits that description.
  That is hardly accurate. If we look at another map shown in the scope 
of reality, we see the small portion of Alaska that is known as ANWR is 
19 million acres, and we have set aside 8 million acres in wilderness 
and 9\1/2\ million acres in refuge, leaving 1\1/2\ million as a coastal 
point, which is the only area disturbed if drilling is authorized by 
the Congress of the United States.
  These land designations were made in about 1980. They are permanent. 
The wilderness will remain the wilderness, 8 million acres, the 9.5 
million acres will remain in the refuge, leaving the small area open 
for exploration.
  The difference is the geologists say this is the most likely area 
where a major oil discovery might be made in North America, and they 
indicate 10 to 16 billion barrels, equal to what we import from Saudi 
Arabia.
  The other fallacy not noted is there is a footprint there already.
  There is a village. There are about 227 Eskimo people who live there. 
This is their airstrip, hangars, schools. This is a picture of the 
children going to school, happy, Eskimo children. It is a pretty bleak 
outlook because it is winter there about 10 months out of the year.
  I want to show this major map again. When we talk about this area the 
size of the State of South Carolina, 19 million acres, and take it down 
to 1.5 million acres here--here is Kaktovik. The picture just appeared. 
To suggest there is nothing there is misleading. This is the radar 
site. This is the village. The airstrip is over here. The footprint is 
really there. That is what is in this area of ANWR. The rest of it, as 
I indicated, is a refuge or wilderness. I might add, we have about 118 
refuge or wilderness areas where we are producing oil or gas. To 
suggest this is unique begs the issue. It is unique, but you have to 
keep it in perspective.
  For those who say, why don't we have some area of wilderness that has 
not had any footprint, let me show a couple. In our State of Alaska, we 
have 59 million acres of wilderness. This is the Gates of the Arctic 
here, which is a little over 8 million acres. That is it. You can 
wander through it. It is designated ``wilderness.'' You can view it for 
its beauty or its harshness.
  We have another area here in the Wrangell-St. Elias area. We have 
some almost 11 million acres of wilderness in this area. To suggest 
this is the last wilderness is hardly respecting reality. I want the 
record to note that because many of my colleagues are under the opinion 
this is the only area left.
  Let me conclude with a couple of other items that I think are 
relevant to this particular issue. To give some idea, Wrangell-St. 
Elias is much bigger in wilderness than is ANWR. The Gates of the 
Arctic, as I indicated, are about 8 million acres.
  To give some idea of the extent of the efforts to accommodate the 
wildlife, this is an article entitled ``Bruins Brewing? Polar bears 
apparently booming on stretch along Beaufort Sea.''
  It further states:

       Beaufort Sea area's polar [bear] population could be in 
     excess of 2,500.

  Some will suggest the polar bear den in ANWR. The polar bear don't 
den in ANWR, they den on the ice. There are a few that do winter there, 
but the most significant thing about what we do with the polar bear is 
we don't allow hunting of the polar bear. If you are a Caucasian, you 
cannot take a polar bear. You can in Russia or Canada, but you cannot 
take it in the United States because it is a marine mammal and is 
protected. The Native people take a few for subsistence. To suggest 
somehow we are going to decimate the polar bear is again mythical, a 
story, not made up of any scientific fact.
  The idea of spills in the area--let me show the Prudhoe Bay area, 
because it represents the old technology. The oilfield is here with the 
caribou. There is the pipeline. There are the caribou. You have seen it 
before, Mr. President. Those are not stuffed animals. They are browsing 
around because there is nothing that will harm them.
  If you spill a pint of oil from your transmission, it has to be 
reported. If you spill water, it has to be reported. We have very 
stringent environmental laws and regulations to ensure we reduce to a 
minimum the exposure.
  I also want to show another picture of the wintertime and what some 
of the animals are acclimated to. Because it is easier to walk there, 
they walk on the pipeline. They are walking on the pipeline because it 
is easier to do that than it is to walk on the snow. These are actual 
photographs. It is not anything that was put together.
  Let me also show pictures of what it looks like building the area in 
the wintertime where we have the rough and rugged tundra. In the 
winter, it is very bleak. There are about 10 months of winter a year. 
Here is the technology used to develop the oilfields. We use winter 
roads made of ice.
  Again, it is new technology. Here is the same picture in the summer. 
It is about a 2-month summer. You can see the footprint is very 
manageable.
  My point going into this detail is that those who criticize give very 
little credit to the advanced technology that we have, the ability to 
find oil and make a very small footprint.
  The justification for going into ANWR is that geologists tell us that 
is where a major find is more likely to be made than any other area. 
They suggest somewhere in the area of 16 billion barrels.
  As we look at what I think are some of our inconsistencies, let me 
remind you that we are now importing 750,000 barrels from Iraq. We 
fought a war over there in 1991. We lost 147 lives. The significance of 
depending on that source, I think, suggests we are compromising our 
national security. I say that realistically because the other day we 
noted we took a very aggressive posture, bombing some of the radar 
sites in Iraq up near Musel to take them out because we thought they 
were hindering our efforts to enforce a no-fly zone. What they did not 
tell you was there have been about 20,000 sorties since 1991-1992, at 
great cost to our Government, enforcing the no-fly zone.
  Just what are we doing? If I can simplify our policy, we are 
importing 750,000 barrels of oil from Saddam Hussein. We give him 
payment for that oil. We take the oil, put it in our planes, and go 
bomb him. Maybe I am missing something. What does he do with our money? 
He takes our money and, in effect, takes care of his Republican Guard, 
which keeps him alive. He also develops a missile capability and a 
delivery capability and biological capability. At what is it aimed? At 
our greatest ally, Israel. Maybe I am being overly simplistic, but if 
you think about it, that is about what happens.
  At what point do we sacrifice our national energy security interests? 
What we have done in this legislation which we have introduced today--I 
see Senator Craig on the floor--we are attempting to reduce our 
dependence to 50 percent or less, instead of increasing it. As the 
Department of Energy says, by the year 2005 or 2006, we will be close 
to 60 percent. At what point do we compromise totally? At what point 
are we becoming so dependent on the Mideast nations that we no longer 
have any leverage left? They can control the supply. They can control 
the price.
  We are not going to eliminate our dependence, but we can reduce it. I 
see the U.S. Coast Guard reducing its mission capability for rescue and 
fishery patrol because of the increasing costs of fuel, which limits 
their mission capability. I ask unanimous consent this document be 
printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

[[Page 2217]]



             Coast Guard Cuts Back on Patrols To Save Money

       Kodiak (AP).--In an effort to save money, the Coast Guard 
     has shaved five days off the cutter Storis next patrol of 
     fishing grounds.
       The Storis was due to leave Friday to patrol Alaska's 
     domestic fishing grounds, including the Aleutians and the 
     Bering Sea, and make routine boardings of U.S. fishing 
     vessels. But the 230-foot cutter will not get under way until 
     Wednesday morning, said Cmdr. Ray Massey.
       ``Our Pacific Area Command decided to go ahead and keep 
     them at the dock as a cost-saving measure,'' Massey said. 
     ``We're concerned that they get under way. They've missed 
     several days of domestic boardings.''
       The Coast Guard has taken similar measures in the past, 
     Massey said. This time the Alaska command is trying to close 
     a 10 percent cut in the operational budget.
       ``This budget struggle is based on the high cost of fuel 
     and the mandated increases in salaries,'' Massey said.
       The Department of Defense raised military wages 3.7 percent 
     Jan. 1, but did not adjust the Coast Guard budget.
       Cutters spend 45 days at sea when they are on standard 
     patrol duty. It costs roughly $3,500 an hour when cutters are 
     under way, Massey said. Multiplied by 24 hours, a few days 
     tied to the dock results in savings of about $84,000 a day.
       ``We need a supplemental budget increase,'' Massey said.
       The delay does not affect Coast Guard search-and-rescue 
     operations, with helicopters and the 378-foot cutter Mellon 
     on the grounds in the Bering Sea, he said.
       The delay also did not disappoint most of the crew on-board 
     the Storis, according to seaman Frances Jiannalone.
       ``It was like a total surprise. We were just about to get 
     under way, I'm talking 10 minutes, and I answered a call. 
     They asked if we were about to get under way. I said yes, and 
     they said, `Well, that's all about to change,' '' Jiannalone 
     said.
       He said the captain announced the delay 10 minutes later.

  Mr. MURKOWSKI. When that happens, it affects all of our capability as 
well.
  When we look at the dreaded situation in this country relative to 
what has happened in California, we realize that some of our aluminum 
companies are not making aluminum because they have long-term contracts 
for energy and they are selling the energy. Urea fertilizer factories 
are no longer selling urea because they can sell the gas for a higher 
price than if they sold the product. These are inconsistencies that 
affect the very backbone of our Nation.
  As we begin the debate on the energy bill, I encourage my colleagues 
who have heard from the environmental community that somehow this can't 
be done safely to recognize the responsibility on the national security 
interests of this Nation and to recognize the technological advances 
that we have made. For heaven's sake, come up and see for yourself. We 
have extended an invitation to Members of this body to come up to ANWR 
on the 30th or the 31st of March and the 1st of April. We extended that 
to spouses as well. Get an appreciation. Keep your mind open until you 
see it. Many of the Members, of course, tell me: Frank, we understand 
you did open it. We really know that. But you know how it is with the 
environmental community if you argue against them.
  What responsibility does the environmental community have relative to 
their responsibility to come up with some alternatives and recognize 
that we have an energy crisis? They simply say we can conserve our way 
out. You simply can't do it. We can do a better job of it. But we are 
an electronic society. We send e-mail and use our computers. The 
reality is we have to do better. We have to use alternatives. But you 
can't conserve your way out of this.
  The reason I am going into this at some length is ANWR becomes 
somewhat of a lightning rod because it is a cause, if you will, for the 
environmental community. They need a cause. They need a cause that is 
far away where the American people can't really see it for themselves 
and that the press really can't afford to go see. As a consequence, it 
generates great membership, great dollars, and the fear that somehow we 
can't do this. Yet in Prudhoe Bay, we have had 30 years of experience 
and 30 years of technology. The footprint now is estimated--as you move 
from this technology 30 years ago over to this area on the map of 
ANWR--out of this million and a half acres up here in the Coastal 
Plain, which is the only thing we are talking about --we are not 
talking about this because this is a refuge--we are talking a footprint 
of roughly 2,000 acres. That would be the footprint if the oil is there 
in the volume.
  I encourage my colleagues to keep the discussion and the debate 
within the parameters of facts as opposed to emotions. To suggest that 
somehow we do not have the technology to take care of the Porcupine 
caribou herd is ridiculous. We only allow drilling in the wintertime as 
a consequence of the caribou calving. We have improved the central 
Arctic herd.
  People ask, Is this energy bill going to be compromised by ANWR? Is 
that the backbreaker? I hope my friends in this body and in the 
environmental community recognize that we have a responsibility to 
address an energy crisis, and by passing this legislation including 
ANWR, we are going to be able to reduce our dependence on imported oil 
to less than 50 percent within a reasonable period of time.
  Some people say it is going to take you 10 years, if the oil is 
there. That is absolutely ridiculous. We have a pipeline 45 miles from 
Prudhoe Bay. It only needs another 25 miles, and we could have this 
area open in less than 3 years to have oil flowing, if indeed the oil 
is there.
  Some people say, Senator, it is only a 6-month supply. That is a 
bogus argument. That assumes there is not going to be any other oil 
produced in this country for 6 months; all of it will stop.
  You can turn that thing around, and say, well, if we don't develop 
it, then the United States is shortchanging itself with a 6-month 
supply for all the trains, airplanes, and all the boats. It is a 
ridiculous argument, if the oil is there.
  Remember Prudhoe Bay. This area has been producing 20 percent of the 
total crude oil produced in the United States for the last 27 years. At 
one time it was 25 percent. That is the factual record.
  Please keep this in mind. If you want wilderness, we have 59 million 
acres of wilderness in our State, and more than all the States put 
together. We are proud of it. But to suggest that somehow you are going 
to jeopardize this 19 million acres by initiating some drilling in 1\1/
2\ million acres just doesn't fly with reality.
  We must have an opportunity to debate some of these environmental 
groups that put fear in some of my Native people. These people who live 
in this area, whether they be the Eskimos on the North Slope or the 
Gwich'in people, are proud people and look for a better way of life and 
opportunities.
  In Barrow, I always recall one friend of mine who said: Senator, I 
used to come to school to keep warm.
  I said: What do you mean?
  He said: The first thing I did when I got up and left our sod home 
was to go out and pick up driftwood. There were no trees. That would be 
driftwood floating down the McKenzie River and lying around on the 
beach. He said: I came to the Bureau of Indian Affairs school to keep 
warm.
  Then we look at Barrow today. They have the most beautiful school in 
the United States. They have an indoor recess area because they have 
the taxing ability to improve their lives, to give them an alternative 
lifestyle where every child has an opportunity for a full paid college 
education, if they wish it. There is no where else in the country with 
that.
  Then we have the Gwich'in people in Old Crow and other areas in 
Alaska down near the Fort Yukon Arctic village. I have been in the area 
and have met the people. But there is the group that the Gwich'in 
Steering Committee has put the fear into that somehow these people will 
lose the Porcupine caribou herd if, indeed, there is development in 
this Coastal Plain.
  This is kind of interesting. This is the U.S. This is Alaska. This is 
Canada. This is the migration route of the caribou. They have a wide 
range. They come up here and calf sometimes in the Coastal Plain, and 
sometimes not. But, in any event, they cross a highway, the Dempster 
Highway. All these little marks are wells that were drilled in

[[Page 2218]]

their path. They did not find any oil so they made a park out of it. 
That is fine. But somehow we have seen the environmental groups--the 
Sierra Club, Friends of the Earth, the Wilderness Society--fund this 
effort to basically suggest to the Gwich'in people that their lifestyle 
and their traditions will be lost, and their dependence on the 
Porcupine caribou herd will be lost if indeed, this development takes 
place.
  There is another group of Gwich'ins who are looking forward to having 
job opportunities and so forth. Time and time again, they have been 
invited up to Barrow to meet with the Eskimos to see what the ability 
to tax oil and oil facilities has meant to their lifestyle. Each time 
the journey is cut short by the pressure of the Gwich'in Steering 
Committee. You have to be careful who you are talking to when you talk 
of the Gwich'ins because there are two different people. One of the 
groups--the Gwich'in Steering Committee--is funded by a significant 
portion of America's environmental community. And one more time: For 
what reason? Because they need a cause. Their cause generates 
membership, dollars, and is so far away that it can't be evaluated on 
its own merits.
  That basically concludes my remarks on this particular aspect of the 
energy bill, which I think deserves some special attention since it has 
been identified time and time again.
  I encourage my colleagues to give me a call if they have any further 
questions. I hope they will accept the invitation of Senator Stevens 
and I to come up and visit the area. If not, we would be happy to meet 
their staffs.
  I remind them that all of us have an obligation to meet our 
legitimate environmental concerns. We also have an obligation to 
address the national security interests of our Nation as far as our 
growing dependence on imported oil is concerned. This is an opportunity 
to relieve that in a very positive and meaningful manner.
  I yield the floor.

                               Exhibit 1

  National Energy Security Act of 2001--Press Conference Participants

       Campaign to Keep America Warm: Jim Benfield.
       IOGCC: Christine Hansen, Executive Director.
       NARUC President and PA PUC Commissioner: Nora Mead 
     Brownell.
       KY Public Service Commissioner and Chair NARUC Gas 
     Committee: Edward J Holmes.--``As Chairman of Naruc's 
     Committee on Gas, my committee members and state public 
     utility commissioners across the U.S. work with energy 
     matters on a daily basis. I commend Sen. Murkowski's efforts 
     in recognizing the need for federal legislation that 
     institutes a comprehensive national energy policy including 
     balanced reliance on all energy resources.''
       Small Business Survival Committee: Karen Kerrigan.--``This 
     legislation, by increasing access to critical energy supplies 
     and improving the infrastructure to move those supplies to 
     consumers, will make for more reliable and affordable 
     electric power and transportation fuel, which is essential to 
     small business's economic well-being. Affordable energy is 
     particularly important to small businesses which are 
     extremely sensitive to price fluctuations and supply 
     disruptions. For many small businesses, energy costs and 
     reliable supplies are the difference between profits and 
     losses.''
       Aluminum Association: Robin King.
       The Fertilizer Institute: Ford West.
       American Forestry and Paper Association: Hansen Moore.
       U.S. Chamber of Commerce: Sally Jefferson.
       National Association of Manufacturers: Mark Whittenton, 
     Vice-President, Resources, Environment, and Regulation.--
     ``With NAM calculations indicating that the rising price of 
     oil and gas cost our economy more than $115 billion between 
     1999 and 2000, it is clear that energy problems will have 
     ripple effects throughout the economy. Congress and the 
     Administration must develop a strategic national energy plan 
     to increase energy supply, improve energy efficiency and 
     optimize all energy resources, including natural gas, oil and 
     coal.''
       American Farm Bureau: Jon Doggett, Senior Director, Natural 
     Resources and Energy.
       Business Council on Sustainable Energy: Michael Marvin, 
     President.
       Plug Power Inc.: Jennifer A. Schafer, Director of Federal 
     Governmental Affairs.--``Senator Murkowski is to be commended 
     for his foresight in addressing the America's dire energy 
     situation. We look forward to working with the Chairman and 
     his staff to expand his distributed generation provisions to 
     include residential fuel cell systems.''
       American Methanol Institute: Bailey Condrey, Jr., Director 
     of Communications.--``The current energy situation 
     underscores the need for a comprehensive energy policy that 
     will encourage the use of alternative fuels and alternative 
     fuel vehicles and technologies.''
       National Association of Neighborhoods: Ricardo Byrd.--
     ``Energy is the lifeblood of America's neighborhoods: it 
     heats, lights and powers our homes, providing for our most 
     basic needs. We are witnessing this winter the devastating 
     impact on our neighborhoods--particularly on seniors, poor 
     and hardworking families--of the failure to have a 
     comprehensive national energy policy.''
       Edison Electric Institute: Lynn LeMaster, Senior Vice 
     President.--``U.S. energy policy should focus on assuring 
     adequate domestic energy supplies, renewing and expanding our 
     energy transportation infrastructure, assuring adequate 
     electricity generation and a diverse fuel generation mix, 
     improving energy efficiency, encouraging investment in new 
     technology and providing energy assistance to low-income 
     households. The Murkowski bill addresses all these 
     concerns.''
       Printing Industries Association: Wendy Lechner, Senior 
     Director, Federal Employment Policy.
       ASAP Printing, Alexandria, VA.: Joe Brocato, Owner.--``In 
     representing the 14,000 members of the Printing Industries of 
     America (PIA) here today, I strongly support improving and 
     increasing domestic energy sources and encouraging energy 
     conservation. Printing companies like mine are fairly 
     significant users of energy resources. As energy prices 
     continue to increase, I worry about the effects. Do I raise 
     prices and harm my relationship with my customers or will I 
     be forced to let go long-time, loyal employees? Neither 
     choice is a good one. A well thought out national energy 
     policy is needed and needed soon.''
       United States Combined Heat and Power Association: John 
     Jimison, Executive Director.--``We believe that this is a 
     critical time for Congress to confront comprehensively the 
     nation's energy imperatives--the need for adequate supplies 
     of electric and thermal energy at competitive costs with 
     short lead-times, maximum fuel efficiency, high reliability, 
     and minimal environmental impact, in a market open to all 
     participants.''
       American Petroleum Institute: Red Cavaney, President.
       American Public Gas Association: Burt Kalish.
       American Gas Association: Dave Parker, President and CEO.--
     ``To meet consumers' strong demand for natural gas in coming 
     years, we commend Senator Murkowski for sponsoring this 
     important legislation, which calls for a comprehensive review 
     of natural gas resources, expansion of the pipeline delivery 
     system and development of energy-efficient technologies.''
       Questar Gas: Nick Rose, CEO, Chairman, American Gas 
     Association.
       Washington Gas: James H. DeGraffenreidt, Jr., Chairman & 
     CEO.--``Authorization of significant, long-term LIHEAP funds 
     and incentives to improve energy efficiency are clear 
     benefits for our customers. Additionally, a national energy 
     policy will benefit everyone by addressing the supply/demand 
     relationship in a balanced and economically-efficient 
     manner.''
       Nuclear Energy Institute: Joe Colvin, President.--``The 
     energy policy proposed by Senator Murkowski is a well-crafted 
     framework to build a brighter, better future for the American 
     people. It recognizes the valuable role that nuclear energy 
     plays in our country's diverse mix of energy sources, and it 
     takes positive, practical steps to ensure a broad base of 
     energy sources are available in the decades to come.''
       Association of Home Appliance Manufactures (AHAM): Joseph 
     McGuire, President.--``The Association of Home Appliance 
     Manufacturers applauds Sen. Murkowski for his leadership in 
     helping develop a national energy policy. We support efforts 
     to establish such a policy through measures aimed at energy 
     supply, conservation and energy efficiency.''
       Natural Gas Vehicle Coalition: Paul Kirkhoven.--``We 
     commend Senator Murkowski on his leadership by introducing 
     the National Energy Security Policy Act. This bill, when 
     enacted, will meet the energy needs of today's consumers and 
     will promote the increased use of natural gas as a motor 
     vehicle fuel.''
       American Propane Gas Association: Lisa Bontempo.
       American Institute of Architects: Dan Wilson, Senior 
     Director, Federal Affairs.
       Association of Home Appliance Manufacturers: Joseph M. 
     McGuire, President.
       American Gas Cooling Center: Tony Occhionero, Executive 
     Director.--``We commend the Chairman for his leadership in 
     moving quickly to address the reliability and adequacy of our 
     nation's energy system. As the legislation makes its way 
     through Congress, we will work to ensure further peak demand 
     reduction measures through inclusion of gas-fired cooling and 
     additional on-site power generation.''
       Process Gas Consumers: Dena Wiggins.
       Building Owners & Managers Association: Gerald Lederer, VP 
     Government & Industry Affairs; Karen Penefiel.--``The federal 
     government needs to enact a national energy

[[Page 2219]]

     policy which ensures all consumers have access to adequate 
     supplies of reasonably priced energy. A building owner's 
     ``commodity'' is a productive office environment, which is 
     not an ``interruptible service.'' Even a temporary (energy) 
     shutdown can lead to major problems.''
       National Association of Home Builders: William P. Killmer, 
     SR Staff VP, Government Affairs.
       American Chemistry Council: Jim D. McIntire, Vice 
     President.
       Society of Independent Gasoline Marketers of America: Greg 
     Scott, Counsel.--``SIGMA represents independent petroleum 
     marketers who are deeply concerned about balkanization of the 
     nation's motor fuels markets, retail price volatility, and 
     the decreased overall supplies of gasoline and diesel fuel. 
     SIGMA members are convinced the country can have clean fuels, 
     environmental protection, and a sound national energy policy 
     that increases overall supplies and competition.''
       National Association of Realtors: Doug Miller, Commercial 
     Policy Rep, Gov. Affairs.
       Competitive Enterprise Institute: Myron Ebel.--``Senator 
     Murkowski's bill if enacted will re-establish the conditions 
     necessary for the energy industries once again to be able to 
     provide Americans with cheap and abundant, reliable energy, 
     upon which our prosperity is based. For example, it will 
     encourage environmentally-responsible oil and gas exploration 
     and production on federal lands closed by Clinton and make it 
     possible to build needed new pipelines and refineries.''
       National Association of Convenience Stores: John 
     Eichberger, Director of Motor Fuels.--``NACS members sell 
     approximately 60 percent of the motor fuels in the United 
     States every year. NACS members are strongly supportive of a 
     national energy policy that increases motor fuel production, 
     provides clean motor fuels to our customers, and recognizes 
     the important role that motor fuels play in driving our 
     nation's economy.
       The Coalition for Affordable and Reliable Energy (CARE): 
     Paul Oakely.--``Senator Murkowski has taken the first step in 
     the process of developing a much needed national energy 
     policy. We support the development of a sound energy policy 
     for America which takes full advantage of diverse domestic 
     energy resources, including its abundant coal reserves, while 
     striking a sensible balance among social, economic, national 
     security, environmental and energy goals.''
       National Restaurant Association: Lee R. Culpepper, SRVP 
     Government Affairs.
       The National Petrochemical and Refiners Association: Bob 
     Slaughter, General Counsel.--``The National Energy Security 
     Act will strengthen America's refining infrastructure by 
     refocusing public policy on the need to maintain and expand 
     the nation's refinery capacity. This will help provide 
     individual consumers with a stable supply of petroleum 
     products at reasonable prices and petrochemical producers 
     with predictable amounts of competitively-priced 
     feedstocks.''
       Americn Highway Users Alliance: Bill Fay, Executive 
     Director.
       National Plumbing, Heating, and Cooling Contractors: Lake 
     Coulson.--``PHCC is composed of almost 4,000 contracting 
     business, many of whom are small businesses and are affected 
     by the current energy situation. PHCC believes that the 
     country needs an energy policy that will provide reliable 
     energy and affordable prices for American families and 
     businesses. PHCC-National Association supports efforts 
     designed to improve energy efficiency and conservation. PHCC-
     National Association supports the installation and use of 
     water conserving methods and products.''
       Owner Operator Independent Drivers Association: Paul 
     Cullen, Government Affairs Representative.
       Air Transport Association: Ed Merlis.--``Senior Vice 
     President, Legislative and International Affairs. With jet 
     fuel being our second highest expense item, airlines have 
     felt the serious consequences of escalating energy prices, 
     which raise airfares, particularly on leisure travelers. It 
     is imperative that we develop a comprehensive national energy 
     policy. Senator Murkowski's legislation is a strong, positive 
     step in that direction.''

  Mr. CAMPBELL. Mr. President, today I am pleased to join my friend and 
colleague Senator Murkowski as an original cosponsor of the National 
Security Act of 2001. This bill represents a significant effort to 
define our national energy policy and it will be considered shortly.
  For years many Senate Republicans called on the previous 
administration to define our national energy policy. It is apparent 
that they never answered our calls. We all know that this bill must now 
be discussed and specific concerns need to be addressed. But, this is 
an important step to lay the foundation for our future energy plans.
  We are a Nation that uses coal, oil, hydro power, natural gas and 
nuclear power. This cannot be disputed. But, the previous 
administration would not accept this reality. And, unfortunately, they 
tried to stand in the way of domestic oil production by locking up 
public lands. Now we are in a very good position with the current 
administration to build a secure energy policy which is long lasting, 
environmentally friendly and will decrease our dependence on foreign 
oil.
  I am hopeful that this is just the starting point. Some organizations 
will have concerns with this bill, and I have some as well. For 
instance, Rural Electric Associations, commonly referred to as Co-ops, 
have concerns that I would like to see addressed, especially since such 
a big portion of my home state of Colorado is covered by Co-ops. I am 
confident, however that we can all come together, resolve our 
differences and construct a national energy policy that will ensure our 
future needs.
  The National Security Act of 2001 is an important step forward to 
define our national energy policy, provide relief from our energy 
problems and promote domestic production so that our Nation can become 
more self sufficient for our energy needs. I urge my colleagues to come 
together to build our energy future.
  The PRESIDING OFFICER (Mr. Nelson of Florida). The Senator from Idaho 
is recognized.
  Mr. CRAIG. Thank you, Mr. President.
  Before I speak to the two pieces of legislation that Senator Frank 
Murkowski has introduced today, let me thank the chairman of the Energy 
and Natural Resources Committee for the leadership that he is 
demonstrating with the introduction of S. 388 and S. 389.
  This country cries out for a clear, well developed policy for both 
the production and the transmission and/or shipment of energy that we 
clearly have found ourselves now lacking and in need of.
  Every American is finally beginning to feel the pinch of energy; in 
this case, the lack thereof--whether it is at the gas pump, or whether 
it is in the power bill they receive monthly, or their space heating 
bill, or the cost of the goods that have a major component of energy in 
them.
  The Senator has just concluded speaking about the potential of 
producing upwards of 16-plus billion barrels of oil domestically in our 
country in addition to what we already have. I will say--and I am sure 
I will say it more than once over the course of the next several months 
of debate--the ANWR issue is not an environmental issue. It never has 
been, and it never will be. It is a political issue.
  The technology of today will protect that environment. When the oil 
is extracted and the wellheads are gone, it will hardly be noticeable 
that man, in the form of his modern technology, was there. This is a 
political issue by interest groups who need a cause. The Senator from 
Alaska has spelled that out well in the last few moments.
  But I rise today in support of national energy and a National Energy 
Policy Act of the kind that the Senator has introduced today and of 
which I am a cosponsor. Clearly, this is the year when I hope Americans 
will insist and that we will respond with the development of a 
comprehensive energy policy.
  We began to look at this anew in 1999. Back then, OPEC cut crude oil 
production to force up oil prices. We then had the luxury of very 
inexpensive crude oil. It worked. As you know, we saw our Secretary of 
Energy rushing off to the Middle East to beg them to turn their valves 
back on. While they did a little bit, they were destined to move crude 
oil from $12 a barrel to, at one point, a high of $32 a barrel last 
spring.
  Our motorists--all of us--were worried about the increasing cost of 
gasoline, and truckers were concerned about rising fuel oil costs. 
Also, residential consumers in the Northeast watched as their home 
heating oil bills skyrocketed last year and remained extremely high 
through this winter.
  In the past dozen months, the situation has worsened. Gasoline, fuel 
oil, and home heating oil have remained at a high premium. Natural gas 
prices have tripled to $6 per million Btu's from under $2 only a year 
ago. That is a tremendous increase in price. Natural

[[Page 2220]]

gas production has remained static, even though the number of drilling 
rigs looking for gas has now tripled in the last year, as finally these 
unbelievable but very market-driven prices have resulted.
  Further, natural gas in storage is just about a billion cubic feet--
about half of what is usually in storage for this time of year. In 
other words, in that arena we are only half prepared. We simply cannot 
build the balance of the storage.
  Further, natural gas is clearly costing the residential consumer an 
astronomical price--but beyond where the gas line goes, where you have 
to use bottled gas out in rural America for cooking, heat, and some 
space heat, there, once again, it has tripled; and even for the poorest 
of Americans, it is a cost they are finding very difficult to bear. 
Wholesale electric prices too have risen significantly.
  Of course, we have all watched and been a part of--at least by action 
or by debate--the episode in California and the experimental, but very 
flawed, electricity deregulation effort that has produced an 
unbelievable high of nearly $300 for a megawatt hour in the spot 
market--$300 for a megawatt hour in the spot market--compared with just 
a few dollars at some points in an Idaho market a few years ago. That 
is a tremendous drive-up in cost. That is about 30 cents per kilowatt 
hour, or five times what the investor-owned utilities in California are 
allowed to charge their consumers.
  To bring it into perspective, my consumers in Idaho, right now, are 
paying about 3.6 cents per kilowatt hour against a California market 
that has peaked at 30 cents per kilowatt. Some folks would say Idahoans 
are not paying enough. Let me tell you, Californians are not paying 
what the market would teach them to pay if their policies were 
different. Then they would dramatically change the politics of their 
State because, once again, ANWR is a political issue and the energy 
crisis in California is a political issue--and a political crisis.
  Southern California Edison and Pacific Gas and Electric Company are 
struggling with a $10 billion unpaid bill for power. They were simply 
not able to go out and collect the money because California law would 
not let them collect the money for the very energy they bought to 
supply Californians. Californians have already consumed the 
electricity, but they have not paid the full price for it.
  California, due to a shortage in the State of power-generating 
facilities, has been forced to import electricity from as far away as 
Texas. And up in my State of Idaho, we now produce power for 
California. Power supplies in the Northwest--my region of the country--
have grown increasingly scarce. Competition for supplies and the fear 
that California utilities will be unable to pay their bills have forced 
up retail prices in Oregon, Washington, and my State of Idaho.
  When the previous administration arrived in 1993, it announced its 
intent to drastically alter the way the Nation used energy, especially 
fossil fuels--gas and oil and coal. President Clinton argued that a 
broad-based Btu tax would force us away from coal and oil and natural 
gas to renewable energy forms, such as solar, wind, and biomass. That 
objective has remained a hallmark of that administration's energy 
policy.
  Oh, yes, some of us have argued that the Clinton administration had 
no policy. Well, they came to town with one. And that one was rapidly 
rejected by the American consumer when the President said that the 
taxes he wanted to raise--nearly $72 billion out of the consuming 
public over a 5-year period--would help the market and help the 
environment. What it ultimately did--because it was rejected--was it 
caused even greater dependence on foreign oil and, of course, had 
phenomenal impacts, as we now see, on the consuming public. In fact, it 
would have unfairly punished energy-intensive States and industries.
  Estimates by the American Petroleum Institute and the National 
Association of Manufacturers, at that time, predicted that the Btu tax, 
which was the hallmark of the Clinton policy, would reduce the gross 
domestic product of this country by $38 billion and that it would 
destroy nearly 700,000 jobs.
  Just in the last 2 quarters, this runup in energy price--which would 
have been equivalent to raising that kind of a tax, only it is now 
greater--has cost the gross domestic product almost a half a percentage 
point. Studies now show at least four-tenths of a percent loss, or 
nearly half a percentage point, and several hundreds of thousands of 
jobs. So those estimates way back in 1994 were not very far off.
  The administration claimed that the tax was needed to balance the 
budget and fund large new spending programs to offset the negative 
impacts of the tax. They also claimed that crude oil imports would 
decline by 400,000 barrels a day.
  At the same time, DOE's own projections predicted the tax would shave 
oil import growth by less than one-tenth a percent after nearly 10 
years under that program. DOE predicted by the year 2000 Americans 
still would depend on foreign oil for three-fifths of their total crude 
oil requirements.
  DOE was not far off. With or without the tax, obviously with growth 
in the American economy and the tremendous wealth and advantages to the 
American consumer that the economy of the last decade has produced, we 
have grown dramatically more dependent upon foreign oil because we 
failed to produce our own. The American Petroleum Institute testified 
at that time that even if imports were to fall by the full 400,000 
barrels a day claimed by the administration, the cost of a $34 billion 
in lost GDP is excessive relative to the alternatives of improving 
energy security. The story went on and on, and no energy policy got 
developed. In fact, quite the opposite occurred. A more restrictive 
approach to the production of domestic energy began to fill in behind 
the inability of our past President to force a huge tax increase on the 
American consumer.
  In the end, Congress refused to accept the Clinton administration's 
efforts to tax our relatively inexpensive energy sources to finance 
their grandiose tax-and-spend social agenda that Congress rejected. 
Congress did agree to raise taxes on transportation fuels. We did that 
by 4.3 cents per gallon, a move I opposed and believed was wrong at the 
time. It is wrong now.
  The past administration's obsession to reduce fossil fuel use as much 
as possible has put us in the position we find ourselves today. 
President Clinton said, on March 7, 2000, at the White House:

       . . . Americans should not want them [oil prices] to drop 
     to $12 or $10 a barrel because that . . . takes our minds off 
     our business, which should be alternative fuels, energy 
     conservation, reducing the impact of all this on global 
     warming.

  Here are the facts: Since 1993, domestic oil production has dropped 
by 17 percent. Domestic crude oil consumption, though, has gone up by 
14 percent. Dependence on foreign sources of crude oil has risen to 56 
percent in total crude oil requirements.
  The PRESIDING OFFICER. The time allotted to the Senator has expired.
  Mr. CRAIG. I ask unanimous consent to continue for no more than 10 
minutes.
  The PRESIDING OFFICER. Is there objection?
  Mr. KYL. Mr. President, might I ask the Senator, did he ask for 1 
minute or 10 minutes?
  Mr. CRAIG. I asked for 10.
  Mr. KYL. Mr. President, I will certainly not object, although that 
will wipe out my opportunity to speak, as I understand it.
  Mr. CRAIG. Reclaiming my time, let me ask for no more than 3 minutes. 
Would that accommodate the Senator from Arizona?
  Mr. KYL. I am sure it would. I know there are other Senators who are 
to follow beginning at a particular time. That would be very helpful. I 
certainly don't want to interrupt the Senator from Idaho because I know 
he has very important comments to make.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. CRAIG. As I said, I am pleased to rise today to support 
introduction of the National Energy Security Act of

[[Page 2221]]

2001. At the request of the Majority Leader during the last Congress, 
Senator Murkowski and other Senators began the process of developing a 
solution to the energy ``fix'' in which we found ourselves beginning in 
late 1999.
  Back then, OPEC cut crude oil production to force up world oil 
prices. It worked--oil prices rose quickly from about $12 per barrel 
and hit a high of about $32 per barrel last spring.
  Our motorists were worried about the increasing cost of gasoline and 
truckers were concerned about rising fuel oil prices. Also, residential 
customers in the Northeast watched as their home heating oil bills 
skyrocketed.
  In the past dozen months the situation has worsened. Gasoline, fuel 
oil, and home heating oil prices remain high. Natural gas prices have 
tripled to about $6.00 per million Btu's (British Thermal Units). 
Natural gas production has remained static even though the number of 
drilling rigs looking for gas has tripled over the last year. Further, 
natural gas in storage is just above 1 billion cubic feet, about half 
of what is usually in storage this time of year. Residential gas 
customers in some parts of the Nation have seen their winter heating 
bills triple.
  Wholesale electricity prices have risen significantly. In California, 
which is experimenting with a flawed electricity deregulation effort, 
electricity prices have been as high as $300 per megawatt hour (MwH) on 
the spot market.
  That's about 30 cents per kilowatt hour or about 5 times what 
investor owned utilities in California are allowed to charge their 
customers.
  Southern California Edison and Pacific Gas and Electric Company are 
staggering under more than $10 billion in unpaid bills for power.
  California, due to a shortage of in-state power generating facilities 
has been forced to import power from as far away as Texas and the 
Pacific Northwest. Power supplies in the Northwest are scarce and 
competition for supplies and fear that the California Utilities will be 
unable to pay their bills has forced up retail electricity prices in 
Oregon, Washington and my home state of Idaho.
  When the previous administration arrived in 1993 it announced its 
intent to drastically alter the way the Nation used energy, especially 
fossil fuels.
  President Clinton argued that a broad based Btu tax would force us 
away from coal, oil and natural gas to renewable energy from solar, 
wind and biomass--that objective has remained a hallmark of that 
administration's ``energy policy.''
  The President promised the tax would raise nearly $72 billion over 
five years (1994-1998) and marketed it as fair, helpful to the 
environment, that it would force down our dependence on foreign oil, 
and would have trivial impacts on consumers.
  In fact, it would have unfairly punished energy intensive states and 
industries. Estimates by the American Petroleum Institute and National 
Association of Manufacturers at the time predicted the tax would hurt 
exports, reduce GDP by $38 billion, and destroy as many as 700,000 
American jobs.
  The administration claimed the tax was needed to balance the budget 
and fund large new spending programs to offset the negative impacts of 
the tax.
  They also claimed that crude oil imports would decline by 400,000 
barrels per day.
  At the same time, DOE's own projections predicted the tax would shave 
oil import growth by less than one-tenth after 10 years. DOE predicted 
that by the year 2000, Americans still would depend on foreign oil for 
three-fifths of their total crude oil requirements.
  API testified: ``. . . even if imports were to fall by the full 
400,000 barrels a day claimed by the administration, the cost of $34 
billion in lost GDP is excessive relative to other alternatives for 
improving energy security. Using the administration's optimistic 
predictions, the cost of the Btu tax works out to about $230 per 
barrel.''
  In the end, Congress refused to accept the Clinton administration's 
efforts to tax our relatively inexpensive energy sources to finance 
their grandiose tax and spend social agenda. Congress did agree to 
raise taxes on transportation fuels by 4.3 cents per gallon, a move 
Republicans tried to reverse during the 106th Congress.
  The past administration's obsession to reduce fossil fuel use as much 
as possible has put us in the position we find ourselves today. 
President Clinton said on March 7, 2000 at the White House:

       . . . Americans should not want them [oil prices] to drop 
     to $12 or $10 a barrel again because that . . . takes our 
     mind off our business, which should be alternative fuels, 
     energy conservation, reducing the impact of all this on 
     global warming.

  Since they came to office in 1993: Domestic oil production is down 17 
percent; domestic crude oil consumption is up 14 percent; and 
dependence on foreign sources of crude oil has risen to 56 percent of 
total crude requirements.
  By comparison, in 1973, during the Arab oil embargo, our dependence 
on foreign crude was 36 percent of our total crude oil requirements.
  The past administration's failure to encourage domestic oil 
production and production of coal and natural gas has lead us to this 
point. That administration refused to acknowledge that vast reserves of 
oil and gas offshore, in Alaska and in the Rocky Mountain overthrust 
area should play a role in reducing our dependence on imported oil.
  The Clinton administration in 2000 announced a ban on future 
exploration on most of the federal outer continental shelf until 2012.
  In 1996 the Administration resorted used the Antiquities Act to 
create the Grant Staircase/Escalante Monument thereby dening access to 
about 23 billion tons of mineable coal reserves in Utah.
  The U.S. Forest Service has issued road construction policies that 
are designed to restrict the energy industry's ability to explore for 
oil and gas on Forest Service lands.
  Former President Clinton vetoed legislation in 1995 that would have 
opened the Coastal Plain of the remote Alaska National Wildlife Reserve 
denying the nation access to an estimated 16 billion barrels of 
domestic crude oil--which could amount to production of 1.5 million 
barrels per day over the next 20 years--about 10 percent of daily U.S. 
consumption.
  The Clinton administration ignored a report prepared by the National 
Petroleum Council, requested by the Energy Secretary, explaining how 
the nation can increase production and use of domestic natural gas 
resources from about 22 trillion cubic feet per year to more than 30 
trillion cubic feet per year over the next 10 to 12 years.
  The past administration showed little interest in solving our 
domestic energy problems even as foreign oil producers have forced 
crude oil prices to over $30 per barrel and gasoline prices to almost 
$2.00 per gallon--double prices of only little more than a year ago.
  Mr. President, the past administration has acted in other ways 
designed to force us away from the use of readily available, relatively 
inexpensive fossil fuels, nuclear energy and hydropower. It chose 
especially to vilify and deny the use of our most abundant national 
energy resource--coal.
  The U.S. has the world's largest demonstrated coal reserve base and 
accounts for more than 90 percent of our total fossil energy reserves.
  At present rates of recovery and use, U.S. reserves will last more 
than 270 years.
  Coal is used to generate over 56 percent of our electricity supply--
and about 88 percent of the Midwest's electricity needs.
  Electricity from hydro represents about 10 to 12 percent of our 
electricity needs.
  Nuclear powerplants meet about 20 percent of our total electricity 
demand. Yet the past administration had a dim view of these sources and 
took steps to reduce their use.
  For example, former Interior Secretary Bruce Babbitt talked openly 
about ``tearing down dams'' in the West to restore habitat for fish, 
ignoring the power and transportation benefits they provide. And, the 
past administration imposed new, often impossible criteria that must be 
met before federal licenses can be reissued. Many existing hydro 
projects will seek relicensing over the next several decades.

[[Page 2222]]

  The past administration also vetoed legislation designed to create a 
permanent nuclear waste storage facility and which fulfills a 
longstanding promise by the federal government to create such a 
facility. Without a federal storage facility, U.S. nuclear generating 
stations, which are running out of on-site storage capacity may be 
forced to begin shutting down some operations.
  There are too many more examples of the past administration's failure 
to produce a coherent, balanced national energy plan. The result of 
this failure is tight energy supplies and high prices.
  Solving these problems requires tough choices and I suggest that we 
begin now by pursuing a number of short and long term objectives. I 
think the bill we are introducing today addresses these challenges.
  Mr. President, I want to touch briefly on two aspects that are of 
great concern to me and my fellow Idahoans. Chairman Murkowski has 
already gone through it in some detail.
  The bill contains provisions of great importance to the future of 
nuclear energy, which currently accounts for about twenty percent of 
U.S. electricity demand. Nuclear energy is a clean, safe, reliable 
technology which provides baseload power at low cost. The increase in 
natural gas prices has shown us the danger of relying on natural gas 
for all of our new electricity generation.
  Other countries have adopted the advanced nuclear technologies 
developed in this country and are putting them to use. In fact there is 
much excitement in the energy industry over plans to build a new type 
of nuclear plant--called ``pebble bed reactor''--in South Africa. I 
believe at some point in the future we will once again appreciate the 
value of non-emitting energy such as nuclear, and choose to construct 
additional nuclear generating facilities in the U.S. For this reason, I 
am working with my colleague, Senator Domenici, to develop other 
proposals regarding the nuclear energy option and we hope to have 
additional legislation soon for the Senate to consider.
  The legislation also provides important tax incentives to encourage 
the use of geothermal energy. I have personal experience with what a 
wonderful role geothermal can play in our energy mix because the Idaho 
Statehouse in Boise and other buildings in the downtown area are heated 
with geothermal energy.
  In the right applications, geothermal is a clean, efficient energy 
source available for our use and because there are no ongoing fuel 
costs and relatively inexpensive maintenance costs, after the initial 
capital investment, it is a very low cost energy option.
  Finally, Mr. President, I want to address the matter of power from 
hydroelectric facilities, upon which the Pacific Northwest is highly 
dependent. The relicensing process for hydroelectric facilities is 
becoming increasingly costly and time-consuming. It now takes more than 
five years to relicense a facility--up from only 9 months in 1980 
according to the Federal Energy Regulatory Commission.
  Hydropower currently accounts for about 12 percent of the electricity 
generated in the United States and it produces that power without air 
pollution or the greenhouse gas emissions.
  Under current law, several federal agencies are required to set 
conditions for licenses without regard to the effects those conditions 
have on project economics, energy benefits, impacts on greenhouse gas 
emissions and values protected by other statutes and regulations. Far 
too often the relicensing process is plagued with agency disagreements 
and inconsistent demands.
  A very large number of public and privately owned hydro facilities 
will be up for relicensing over the next ten years. Some may be 
abandoned if the relicensing process becomes prohibitively expensive 
and time-consuming. The legislation being introduced today will help 
streamline the process and make the involved agencies more fully 
accountable for their decisions.
  The legislation does not change or modify any existing environmental 
laws, nor does it remove regulatory authority from various agencies. It 
does not call for the repeal of mandatory conditions on a FERC issued 
license.
  It is clear to me and many of my colleagues that hydropower is at 
risk and one of our most important tasks here in the Senate is to 
develop policies that lead to an energy strategy that will ensure an 
adequate supply of reasonably priced, reliable energy to all Americans 
in an environmentally responsible manner. The relicensing of non-
federal hydropower can and should continue to be an important strategy.
  In addition, we should work with our Western Hemisphere neighbors to 
help them increase their crude oil and natural gas production.
  We should provide relief to consumers by eliminating the 4.3 cents a 
gallon tax on motor gasoline enacted in 1993.
  We need to step away from punitive, command and control environmental 
regulations and move toward performance based regulatory concepts that 
offer the regulated community opportunities to find flexible approaches 
to reducing emissions of legally regulated contaminants.
  We must carefully assess the capabilities of our energy production 
and delivery systems to find opportunities to improve system 
productivity, efficiency and reliability.
  We must ensure that sufficient funds are available to help those with 
lower incomes to weatherize their homes and pay their energy bills.
  While renewable energy sources provide only about 3 percent of total 
U.S. demand for energy, we should continue to provide incentives for 
our citizens to use wind, solar, and other renewables.
  We should encourage motor vehicle manufacturers to ensure that 
consumers have access to safe and highly efficient cars and trucks.
  We must realize that we are part of the problem. Our unwillingness to 
develop our own abundant oil, gas and coal resources dooms us to 
greater dependence on foreign sources, especially for crude oil. We 
must make the conscious choice to carefully find and develop our 
resources while protecting our environment.
  I conclude by drawing attention to a portion of this bill that is 
increasingly valuable; that is the area of new technology. Some who 
will argue against this bill would suggest that it is merely a reason 
to fall back to our habits of old. That is not true. We want to and 
will continue to fund the new technology, much of it started in the 
decade of the 1990s. It is clearly important. We are not always going 
to have hydrocarbons around, and we should not be that dependent upon 
them. But in the short term, in the next several decades, as we are 
using our resources and fueling our economy, we need to look at nuclear 
technology and new clean coal technology so we can use the abundance of 
these resources and in an environmentally sound way.
  In my State of Idaho, we are dependent on hydropower. There are many, 
including the past administration and many of their devotees, who would 
suggest the dams on those rivers that produce that clean source of 
energy, nonpolluting, nongreenhouse gas-emitting, that those dams ought 
to be breached. They insist that if the dams are not removed then they 
ought to be regulated in a much more stringent way. In fact, the 
licensing process the Federal Energy Regulatory Commission has as a 
part of its responsibility to renew these hydro facilities is one that 
I am working on. And within this legislation is a reform of the 
licensing process, not to change it and take stakeholders or interested 
parties away from it, but to ask them to perform their responsibilities 
in a timely fashion and in a responsible fashion.
  Why should it take 10 years to relicense a hydro facility and cost 
millions upon millions of dollars that ultimately the consumer has to 
pay? If it needs retrofitting, if it needs improvement of technology 
for environmental reasons, those are conclusions that can be drawn in a 
reasonably quick way, and managed responsibly, so that we can balance 
out our energy needs.
  The legislation the Senate now has before us will be coupled with the 
work the Bush administration is doing now through their Cabinet level 
working group. This administration wants an

[[Page 2223]]

energy policy, too, and it is their goal to produce one for the 
American people.
  Our economy depends on an abundant supply of environmentally sound, 
relatively low-cost energy. It is the wealth of our country. It is what 
drives this marvelous economic engine of ours. And it does something 
very simple--it puts money in the pocketbook of the worker. It turns 
the lights on in his or her home. It helps educate our children. It 
does all of the wonderful things we in America have grown to expect.
  Why should we suggest that we ought to have anything less if we can 
do it with the environment in mind and at a relatively low cost. That 
can be accomplished in a policy in which the Federal Government 
promotes the concept of energy production instead of setting up one 
trip wire after another to disallow it from happening.
  I look forward to the coming debate. I think it is critical that all 
of us get ourselves involved and educated in the issues at hand.
  These two pieces of legislation go a long way toward allowing that to 
happen.
  The PRESIDING OFFICER. The Senator from Arizona is recognized.
  Mr. KYL. Mr. President, I compliment the Senator from Idaho on the 
points he was making. I look forward to joining him in tackling this 
very difficult problem of making some sense out of our national energy 
policy. Senator Craig has the expertise to lead us, along with Senator 
Murkowski. I will be looking forward to joining them in that effort.
  The PRESIDING OFFICER. The Senator from New Mexico is recognized.

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