[Congressional Record (Bound Edition), Volume 150 (2004), Part 4]
[Senate]
[Pages 4809-4811]
[From the U.S. Government Publishing Office, www.gpo.gov]




                                 ENERGY

  Mr. STEVENS. Mr. President, the Energy Committee has introduced a 
revised energy bill. Swift passage of this bill is vital. We should not 
underestimate the widespread and important consequences that this 
comprehensive energy legislation will have for the future of our 
Nation.
  American citizens and businesses rely on our ability to stabilize 
energy prices and provide them with the energy resources they need. 
Now, in the post-9/11 world, our energy development and production has 
taken on an additional level of importance. Our national security is 
dependent upon our ability to decrease our reliance on foreign energy 
sources, particularly from unstable or unfriendly regimes.
  The comprehensive energy policy embodied by this new bill is also 
critical for ensuring our economic growth. High energy prices impact 
our economy in many ways, and our ability to stabilize energy prices 
will have far-reaching consequences for our overall economic health and 
growth.
  The United States is recovering from a recession, but this recovery 
is threatened by sustained high energy prices which will increase real 
interest rates, the rate of inflation, and reduce gross domestic 
product growth.
  This first chart shows that situation. I call it to the attention of 
the Senate. As crude oil prices go up, there are changes in our gross 
domestic product. We have seen these effects firsthand already. High 
energy prices, which rose 4.7 percent in January and another 1.7 
percent in February, greatly contributed to an increase in consumer 
prices. The Department of Labor recently announced that those prices 
jumped .3 percent in February and another .5 percent in March. 
Consumers are paying more for food, goods, and energy bills. High 
energy prices are essentially acting as a consumer tax, leaving 
Americans with less disposable income for travel, home buying, 
restaurants, retail establishments, and daily living.
  Record high gasoline prices only intensify this problem. Gasoline 
prices rose 8.1 percent in January and an additional 2.5 percent in 
March. Last week the average price at the gas pump reached $1.72 per 
gallon, with California leading at an average of $2.10 at the pump. 
These prices are an additional constraint on the consumer spending 
power. For every 1 cent increase at the pump, we see $1 billion lost in 
consumer spending capability.
  The rise in fuel prices also greatly impacts our aviation and 
trucking industry. Our airline industry has lost over $25 billion in 
the last 3 years. Sustained high jet fuel costs of $1 per gallon, which 
is double that of 1998-1999, continues to hamper the health of our 
critical transportation industry. High energy prices also prevent job 
creation for the transportation sector. The Air Transport Association 
estimates for every $1 increase in the price of fuel, they could fund 
5,300 airline jobs. The increase in these prices is staggering.
  Every homeowner in America feels the pressure of high energy prices. 
Home heating costs for the 2002-2003 season were up 12 percent for 
natural gas, 7 percent for propane, and 2 percent for electricity. This 
winter alone, natural gas prices were 60 percent higher than last 
year--60 percent higher than last year. Estimates show that consumers 
may pay more than $200 billion this year in energy costs. This is an 
enormous and unnecessary burden on our economy.
  Overall, it is estimated that since 2000 consumers paid $111 billion 
more than they did in the previous 3 years for natural gas alone. This 
increase cost industrial consumers $57 billion, commercial customers 
$21 billion, and residential consumers $33 billion.
  This second chart shows that situation. We have had job losses 
throughout the country because of this change in energy prices. Look at 
that: In California alone, 250,000 jobs. It has had an amazing impact. 
High energy prices have had a devastating impact on American jobs. 
Since 2000, when the energy crisis began, we have lost 2.9 million jobs 
related to the cost of energy. Sustained high energy prices have the 
potential to lower our gross domestic product, which could cost the 
U.S. an additional 770,000 to 2.7 million jobs. The jobs issue is an 
energy issue. If we want to deal with the jobs issue, we must pass the 
energy bill.
  The industrial energy consumers of America have stated that high 
energy

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prices, most in natural gas, contributed to the loss of almost 2.8 
million manufacturing jobs. Chart No. 3 deals with this problem. Since 
1982, jobs in the oil and gas industry have declined by one-half, from 
over 700,000 jobs to roughly 330,000 jobs.
  As chart No. 4 shows, the chemical industry lost jobs. As gas prices 
go up, the number of chemical industry jobs goes down. The price of 
energy is directly related to the loss of jobs in this country.
  Since 2000, our chemical industry has lost 85,000 jobs. This industry 
employs more than 1 million Americans, and 5 million Americans have 
jobs that depend upon the chemical industry. More of these jobs are 
threatened as major chemical companies across the United States are 
closing their factories and moving to countries which provide cheaper 
natural gas.
  This jeopardizes millions of well-paying American jobs that will not 
be replaced unless we have energy. Moving these industries offshore not 
only contributes to job losses but it increases our burgeoning trade 
deficit. Our chemical industry once was a major exporter, generating a 
$16 to $18 billion trade surplus. Last year the chemical industry 
generated a trade deficit of $9.6 billion, contributing to an overall 
U.S. trade deficit of over $530 billion. That deficit, too, is related 
to energy availability and the cost of energy.
  High energy prices are threatening our fertilizer industry. Up to 90 
percent of the cost of producing fertilizer is directly linked to the 
cost of natural gas. Between 2001 and 2003, eight U.S. nitrogen 
fertilizer manufacturers permanently closed. That is one-fifth--20 
percent--of all the United States fertilizer production. Additionally, 
our ammonia factories are operating at 60 to 65 percent capacity. Why? 
Because of the cost of natural gas.
  The impact of high energy prices is acutely felt by the agriculture 
community. The energy costs account for 6 percent of farm production 
costs. Farmers spent between $1 and $2 billion more this year to plant 
crops. In 2003, farmers paid $350 per ton for fertilizers, more than 
twice what they paid just 1 year previously. That is a 100-percent or 
more increase in the cost of fertilizer in 1 year.
  The good news is a worsening crisis is avoidable. The United States 
has the natural resources to increase our energy supply. But 
inconsistent Government policies discourage exploration, development, 
and the use of our own natural resources--our own energy resources.
  Over 95 percent of undiscovered oil and 40 percent of undiscovered 
natural gas is located on Federal land. These public resources can 
secure our energy needs. Today the Government encourages use of natural 
gas but discourages exploration and development of domestic natural 
gas. As a result, most major energy companies, including some which 
operate in my own State of Alaska, are abandoning the United States and 
investing in and developing energy resources in other countries.
  A recent article shows while the 4 major oil and gas companies 
realized $21 billion in cashflow from their U.S. oil and gas 
activities, they only reinvested $9.15 billion back into the United 
States. Less than half of the money they paid was invested here to 
increase the supply of gas.
  This lack of reinvestment makes us dependent on foreign sources of 
energy from unstable or unfriendly regimes. More and more we are 
dependent on foreign sources.
  This industry generates jobs and revenues in other countries at our 
own expense. These new jobs should be American jobs and that energy 
royalty income should be coming into our Government. The receipts 
generated by that economic activity would help reduce the deficit, 
provide new jobs, fund the war on terror, and support many of the 
domestic programs we cannot fully fund.
  Despite the obvious benefits of domestic energy exploration and 
development, today we rely on foreign imports for over 60 percent of 
our oil supply. Imagine that. It was about 33 percent at the time of 
the embargo on oil in the 1970s. Now it is over 60 percent. We are 60 
percent reliant on foreign oil, and more people oppose the development 
of the oil resources on the North Slope of my State. Currently, we also 
rely on 16 percent for foreign sources for our natural gas supply. 
Energy imports make up the largest portion of our foreign trade 
deficit.
  This is chart No. 5. It shows the natural gas consumption outlook. In 
the last 10 years, demand for natural gas has increased by 19 percent, 
and that number is projected to grow by 50 percent in the next 25 
years. Absent a new supply of natural gas, we will likely see a gap of 
15 billion cubic feet per day or 6 trillion cubic feet per year in the 
next 10 years.
  This chart shows the difference between our consumption and the 
projection into the future. We are growing more reliant on foreign 
sources for our natural gas. We are already 60 percent reliant for oil. 
This chart shows that as the years go by we are going to be more 
reliant on foreign sources for natural gas. It will be expensive 
natural gas. It has to be gasified, transported in cryogenic tankers, 
and then regasified when it gets here. Our own natural gas is pumped 
out of the ground and shipped in a pipeline. The costs associated with 
foreign reliance are going to be staggering. That means more American 
jobs lost.
  The Natural Petroleum Council found that to bridge this gap, $1.2 
trillion dollars must be invested in new exploration and production in 
the United States by 2025. Unless we pass an energy bill to bring 
certainty to American energy policy, that investment will not take 
place. I repeat: Unless this bill is passed, there will be no new 
investment in the production and development of oil and gas resources 
in the United States.
  The high impact of energy prices can be seen at all levels of our 
economy. High energy prices have produced job losses, trade deficits, 
and constraints on consumer spending and economic growth. But the most 
disturbing aspect of this problem is the fact that Congress has been 
debating comprehensive legislation since 2001. I don't think we have 
passed a real energy bill in 12 years. We are squabbling here in 
Congress while high energy prices burn our economy and destroy American 
jobs.
  In April of 2002, the Senate passed H.R. 4, the Energy Policy Act of 
2002, by a vote of 88-11. Then the bill died in conference.
  In July of 2003, after months of intensive debate, the Senate passed 
H.R. 6, the Energy Policy Act of 2003. However, in November of that 
year the Senate rejected cloture by a vote of 57-40, 3 votes short of 
having an energy bill.
  We were elected as public officials to improve the lives of American 
people, to enact laws and to formulate policies designed to ensure the 
strength and economic viability of our Nation. By failing to enact a 
comprehensive energy policy for our Nation, we have failed the American 
people. American businesses and citizens are struggling out of 
recession and meaningful and sustainable economic recovery. Job 
creation will only come with stable energy prices, and they will come 
only if we pass an energy bill and send it to the President.
  A comprehensive energy policy is necessary to secure domestic energy 
security and to support American jobs. Given the negative impact of 
high energy prices on our Nation, we should act quickly to address this 
situation.
  As I said, the Energy Committee has introduced a revised energy bill 
which encompasses a comprehensive and balanced natural energy policy. 
This bill will increase domestic energy supplies, encourage energy 
conservation, stabilize energy prices, bring certainty to American 
energy policy for our businesses and consumers, and ensure our energy 
security. It contains provisions designed to increase oil and gas 
exploration and development, while at the same time promoting energy 
conservation and alternative and renewable energy resources. This bill 
is a jobs bill. It will create more than 800,000 new jobs. Many of 
those jobs will be the result of a major component of this energy bill, 
which is authorization for the building of the Alaska natural gas 
pipeline.
  Our gas pipeline will create over 400,000 jobs in and of itself, 
including

[[Page 4811]]

7,000 construction jobs, thousands of manufacturing jobs necessary to 
create equipment, and thousands of infrastructure jobs. It will meet 
approximately 10 percent of our country's natural gas needs. Over 4 
billion cubic feet per day will come from Alaska to decrease our 
dependence on foreign gas and imports of liquefied natural gas. It will 
generate over $40 billion in revenue for the American Government, 
instead of sending that money overseas.
  Chart 7 shows the 800,000 energy bill jobs. The renewable fuel 
standard provision of this new bill will create in and of itself 
214,000 new jobs. It is estimated this provision will increase farm 
revenue by $51 billion over the next 10 years. This reduces the overall 
farm payments currently expended by the Federal Government by $5.9 
billion.
  In a time when the Federal budget deficit is increasing, it is 
incredibly important we find some cashflow to offset this spending.
  I am still convinced unless Congress acts to ensure greater domestic 
production of our oil resources, our energy security is jeopardized.
  Given the importance of Congress enacting a comprehensive energy 
policy this year, I urge the Senate to move swiftly to pass this Energy 
bill. I can think of not one thing the Senate can do to assist the 
American people more, that will restore American jobs, than acting 
quickly on the Energy bill that has just been reintroduced.
  The PRESIDING OFFICER. The Senator from Wyoming.
  Mr. THOMAS. Mr. President, I agree with the Senator from Alaska. 
Having worked for several years on this Energy bill, it seems to me 
there is nothing more timely than to move forward. This is a policy. We 
think it is for tomorrow, but it is looking forward. It is a balanced 
policy that has alternative fuels. It has clean air. It has 
conservation and efficiency, as well as domestic production. We need to 
do this. I hope we move forward.

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