14
Barriers and Potential

Senator Jeff Bingaman challenged the participants at the summit to identify which American President said the following words:

I am inaugurating a program to marshal both government and private research with the goal of producing an unconventionally powered, virtually pollution-free automobile within five years.

It was President Nixon, in a February 10, 1970, special message to the Congress on environmental quality. In fact, as early as 1958, President Eisenhower proposed limits on the importation of foreign oil, James Schlesinger noted. These calls have led to a succession of federal programs addressing various aspects of energy policy (Figure 14.1). Yet they have not had the impact on energy supplies or uses that their proponents envisioned.

One reason for the limited success of these programs is that the United States does a good job of developing technologies but is less adept at commercializing those technologies, Bingaman said. For example, the Clinton-era Partnership for a New Generation of Vehicles spent about $300 million a year in research and development on such technologies as hybrid engines. But many of the resulting technologies were brought to market by Japanese rather than U.S. firms.

Successive administrations have an incentive to show that a new initiative is a significant improvement over the program of a predecessor, Bingaman said. In doing so, the progress made by a predecessor is sometimes abandoned. New programs also tend to be marked by excessively optimistic assumptions



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14 Barriers and Potential S enator Jeff Bingaman challenged the participants at the summit to identify which American President said the following words: I am inaugurating a program to marshal both government and private research with the goal of producing an unconventionally powered, virtually pollution- free automobile within five years. It was President Nixon, in a February 10, 1970, special message to the Con- gress on environmental quality. In fact, as early as 1958, President Eisenhower proposed limits on the importation of foreign oil, James Schlesinger noted. These calls have led to a succession of federal programs addressing various aspects of energy policy (Figure 14.1). Yet they have not had the impact on energy supplies or uses that their proponents envisioned. One reason for the limited success of these programs is that the United States does a good job of developing technologies but is less adept at com- mercializing those technologies, Bingaman said. For example, the Clinton-era Partnership for a New Generation of Vehicles spent about $300 million a year in research and development on such technologies as hybrid engines. But many of the resulting technologies were brought to market by Japanese rather than U.S. firms. Successive administrations have an incentive to show that a new initiative is a significant improvement over the program of a predecessor, Bingaman said. In doing so, the progress made by a predecessor is sometimes abandoned. New programs also tend to be marked by excessively optimistic assumptions 

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 THE NATIONAL ACADEMIES SUMMIT ON AMERICA’S ENERGY FUTURE Coal Utilization Vehicle Technology Synthetic Fuels Corporation (1979- Virtually pollution-free car 1985) (Nixon 1970) Clean Coal T echnology Program Reinventing the Car (1987) (Carter 1977-1980) Clean Coal Power Initiative (2001) Partnership for a New Generation of Vehicles (Clinton 1993-2000) FutureGen (2003) FreedomCar (Bush 2003) Biofuels Nuclear Technology Alcohol fuels Clinch River Breeder Reactor (Energy Security Act 1980) (1970-1983) Oxygenated fuels Advanced Liquid Metal Reactor (Clean Air Act Amendments 1990) Program (1989-1994) Biofuels Global Nuclear Energy (EPAct 2005; EISA 2007) Partnership (2006) FIGURE 14.1 Starts and stops in energy technology policy. NOTE: EPAct 2005, Energy Policy Act of 2005; EISAFigure 14-1.eps 2007, Energy Independence and Security Act of 2007. SOURCE: Senator Jeff Bingaman, U.S. Senate Energy and Natural Resources Committee. about the costs and capabilities of particular technologies, while not enough consideration is given to the interplay of such programs with other policy areas. And such programs often demonstrate an underappreciation of the scale of the energy enterprise, especially given the difficulties of introducing new technolo- gies on a large scale. A president has to be thoroughly engaged in the energy problem and will- ing to put political capital behind it, said Schlesinger. Few presidents are that engaged in energy issues. The one possible exception was President Carter, who unsuccessfully proposed substantial taxation on the use of hydrocarbons, “and so far as I’ve been able to see,” Schlesinger said, “most politicians have not wanted to emulate him.” The success of governmental policies depends on how well the political process works, Schlesinger observed. But the U.S. government is characterized by a separation of powers, which was designed to avoid a concentration of power that might be dangerous to individual liberties. One consequence of this arrangement is continuous disputation among the three branches of govern- ment. “Blame it on King George III,” said Schlesinger. Politicians also are loath to bring bad news to the public. Schlesinger quoted Russell Long, chair of the Energy Committee, to the effect that the first rule of a politician is to get elected and the second rule is to get re-elected.

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 BARRIERS AND POTENTIAL “That does not lead to a great deal of courage,” said Schlesinger. Politicians tend to engage in tokenism and symbolism. They “put forward something that seems to be moving toward the goal that people are concerned about, but it does very little since it involves very little sacrifice.” For example, various governors have pledged that they will reduce greenhouse gases by 90 percent by the year 2080. “They will not be in office when that day comes around,” observed Schlesinger. Also, politicians tend not to think quantitatively, Schlesinger said. They do not consider the vast amounts of effort required to reduce the more than 7 billion barrels of oil that the United States uses each year or the amounts of greenhouse gases released. And bureaucracies change very slowly, Schlesinger observed. “How high is the Department of Homeland Security on the pecking order amongst government departments at the moment?” he asked. “Home- land security is a very important issue, but [DHS] doesn’t have as much clout as some of the older departments.” Holdren pointed out that the status quo is supported by powerful and wealthy interests. For that reason, those interests tend to be preserved in the policy process. Breaking the hold of the status quo will require several major changes, he said. Partnerships that keep businesses viable can be an agent of change. For example, carbon capture and sequestration will be needed to keep the coal-powered generation business viable. Coal companies recognize that fact and now support approaches that include regulations on carbon dioxide so long as they also include support for technology development and incentives to deploy those technologies. Energy companies also have lots of experience in removing liquids and gases from the ground and know how to put liquids and gases back in place. “They see this as a big emerging business,” said Holdren. Another example is the interest of oil companies in biofuels, and especially advanced biofuels, that use some of the capabilities those companies have in chemical engineering. Public education also is critical, Holdren said. Al Gore’s documentary An Inconenient Truth focused public attention on climate issues. Similarly, articu- late spokespeople will increasingly point out that there are jobs to be created, money to be made, and competitive advantage to be grasped by figuring out how to deliver goods and services that people want in energy-saving ways. Finally, campaign finance reform is essential to loosen the grip of entrenched interests. “Without campaign finance reform, we’re not going to get as much done as we need to, because there are going to be elements of the status quo that are extremely well-funded and are going to continue to be able to buy enough votes to avoid change,” Holdren said. The structure of the federal government is another impediment to change, according to Portney. “I don’t think that the U.S. government is organized in a way that suggests that we take energy as seriously as I think we should or that the government itself thinks [energy] should be taken.” The Department of

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 THE NATIONAL ACADEMIES SUMMIT ON AMERICA’S ENERGY FUTURE Energy’s budget—about $24 billion—may look impressive, Portney said. But much of that funding is devoted to the National Nuclear Security Administra- tion and the cleanup of chemical and nuclear contamination at former and current defense weapons plants, leaving a relatively small percentage for energy issues. In other parts of the federal bureaucracy, the National Highway Traffic Safety Administration in the Transportation Department oversees CAFE stan- dards. The Minerals Management Service in the Interior Department is respon- sible for about a quarter of the oil that is produced in the United States on the outer continental shelf and for about 15 percent of the natural gas produced in the United States. The Minerals Management Service is also responsible for permitting offshore wind turbines. The Federal Energy Regulatory Commis- sion, an independent regulatory body, is responsible for siting hydroelectric facilities and other important facilities in the United States, regulates pricing of interstate and wholesale electricity, oversees interstate shipments of natural gas and petroleum through pipelines, and has a number of other important respon- sibilities. The Nuclear Regulatory Commission, which is another independent regulatory agency, has responsibility for permitting and inspecting new and established nuclear reactors in the United States. The Internal Revenue Service in the Department of the Treasury is in the process of writing regulations about who is qualified to receive subsidies for ethanol and other renewables produc- tion under the recent energy bill. And the Environmental Protection Agency writes national ambient air quality standards, national emissions standards for hazardous air pollutants, and new source performance standards for new indus- trial facilities, including petroleum refineries; rates vehicle emissions standards; promulgates fuel recipes for different parts of the country at different times of the year; and establishes effluent standards for ethanol and other biofuel plants in the United States. “This is clearly the agency that has the biggest impact on energy in the United States,” said Portney. “I want to be very clear in saying that I’m not criticizing any of these agen- cies,” Portney said. “They do—and do well—exactly what it is that Congress has told them to do under the laws that Congress has passed that give them their mandate. I am saying that if we are to treat energy in the United States as seriously as it deserves to be treated, we have to do better organizationally than the mishmash of agencies that we have attending to this critical problem now. And this will require changes in legislation, not just executive orders.” REASONS FOR OPTIMISM Why should the potential for progress be different today than it has been in the past? Several speakers cited possible reasons for optimism. First, tech- nologies that could make a difference in energy production and consumption are closer to the marketplace than they have been previously. Hybrids have

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 BARRIERS AND POTENTIAL entered the market, and plug-in automobiles are on the horizon. Technology development is getting a big boost from high gas prices, which have “stirred a lot of entrepreneurial juices,” Schlesinger said. And discussions of carbon taxes or other means of internalizing the costs of greenhouse gas emissions raise the prospect that policy changes could give a substantial boost to clean technologies. Also, the public and politicians may be more engaged in the problem today than in the past. “The public has to be hit over the head by a two by four” to focus on energy problems, Schlesinger observed. While he doubted that the public was as engaged today as it was during the 1973 and 1979 oil crises, he and other speakers pointed to a growing level of interest in the issue in the United States and other countries—sparked in part by rapid recent increases in energy prices. Also, some speakers observed that the public and policymakers are more aware of the need to move forward on many fronts simultaneously. “The pri- mary solution to the challenges of energy security and environmental preserva- tion is energy diversification,” said Reuben Jeffery. “Greater diversity of energy types, sources, and distribution networks can help improve the security and reliability of energy supplies, mitigate the economic consequences of high oil prices, and promote responsible environmental stewardship.” As Samuel Bodman described the situation, “The bottom line is this: We are seeing a convergence of forces that tells me that our nation is on a path to a cleaner, affordable, and more diverse energy future. The rigorous debate and analyses that the Academies are fostering—and to which all of you are lending your extensive expertise—will help ensure that we continue on the right path- way toward a more secure energy future.” CONTRIBUTIONS FROM SCIENTISTS AND ENGINEERS To reduce energy intensity, the contributions of scientists and engineers will be essential, Bingaman said. Ray Orbach reminded summit participants of President Bush’s words in his 2008 State of the Union address: “To keep America competitive into the future, you must trust in the skill of our scientists and engineers and empower them to pursue the breakthroughs of tomorrow.” Scientists and engineers also need to participate in the shaping of public policies, Bingaman observed. Congress is continually bombarded with informa- tion, much of which has a significant bias. Furthermore, Congress does not have the luxury of waiting to act until it has perfect information. Legislation has to accommodate uncertainty and then be monitored to track the effects of laws. Along with both the crafting of legislation and oversight of implementa- tion, strong and balanced technical input is critical. In that regard, reports from the National Academies and other organizations provide critical input into poli- cymaking, Bingaman said. Reports from these organizations offer balanced and

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 THE NATIONAL ACADEMIES SUMMIT ON AMERICA’S ENERGY FUTURE complete analyses of difficult questions, add technical realism to energy policy, and avoid simplistic views, which helps Congress figure out which technolo- gies will have the greatest benefit at the least cost. Recent controversies over the energy-saving potential of biofuels or of changes in daylight saving time are good examples of the need for reliable information, Bingaman observed. “I would feel much more comfortable knowing that we were basing policy deci- sions about energy and climate on the best information available.” Policymakers also can use the information in these reports to push for more aggressive action by the federal government. COMMUNICATING WITH THE PUBLIC Another essential need is to communicate the urgency of the situation to the public. “Not enough of us spend enough time talking to the public,” said John Holdren. “I suggested in my AAAS presidential address last year that everybody in the science and technology community who cares about the future of the world should be tithing 10 percent of his or her time to interacting with the public in the policy process on these issues, and a lot of that is just giving talks. Wherever I go and give talks about these issues, the reaction is: ‘I didn’t know that. I had no idea how big this problem was. What are the opportunities for addressing it?’ If all of us just got out there and talked to the public more and talked to policymakers more, we would get some of this done.” Dan Reicher emphasized that a focus on solutions is often more produc- tive than a focus on problems. “The public has, to some extent, become numb about the problems,” he said. People realize that the challenge is immense, but they do not realize how straightforward and cost-effective many of the solu- tions are. For example, many people can be motivated to take action, Reicher said, by providing them with information about the energy used in their homes and businesses and laying out a plan for no-cost, low-cost, and medium-cost initiatives. However, it is also important to emphasize that the problems will not be easy to solve, several speakers said. “We always have to communicate that we can do it, but it’s not going to be easy, . . . and it’s going to cost,” said Steven Specker. Also, all options need to be considered. “We need everything,” said Specker. “Each country, each state, each community may decide to deploy or not deploy certain technologies, but as technologists, our message has to be that we need to be working on everything.” In an uncertain world, no single approach is guaranteed to work. Some currently promising technologies will not work, and others will arise that are not currently anticipated. “As many people have observed, there is no single magic bullet,” said Harold Shapiro.