Volume 147, No. 86 covering the 1st Session of the 107th Congress (2001 - 2002) was published by the Congressional Record.
The Congressional Record is a unique source of public documentation. It started in 1873, documenting nearly all the major and minor policies being discussed and debated.
“AMERICA'S ENERGY POLICY” mentioning the Environmental Protection Agency was published in the House of Representatives section on pages H3349-H3354 on June 20, 2001.
The publication is reproduced in full below:
AMERICA'S ENERGY POLICY
The SPEAKER pro tempore. Under the Speaker's announced policy of January 3, 2001, the gentleman from Michigan (Mr. Ehlers) is recognized for 60 minutes as the designee of the majority leader.
Mr. EHLERS. Mr. Speaker, this evening, several of us want to address an extremely important topic, and that topic is energy. Energy is normally not a high-priority issue for most members of the public, and, in fact, for many Members of this Congress.
Nevertheless, it is one of the most important issues that we deal with, and that becomes apparent every time we have a shortage of energy. Prices rise and then we have a major economic impact.
Mr. Speaker, in fact, energy is so important that the last three recessions that this country has experienced have followed immediately upon shortages of energy and an increase in energy prices, and there is some concern that that might happen if we do not correct the current energy shortage.
There are many aspects to discuss regarding energy, and tonight we will be joined by the gentlewoman from West Virginia (Mrs. Capito) and the gentlewoman from New Mexico (Mrs. Wilson).
Mr. Speaker, I yield to the gentlewoman from West Virginia (Mrs. Capito).
Mrs. CAPITO. Mr. Speaker, I want to thank the gentleman from Michigan
(Mr. Ehlers) for yielding to me.
Mr. Speaker, tonight we are going to talk about the energy problem across America, and we are going to talk about some solutions and some ways that I think we can look to the future to try to solve some of the problems.
Mr. Speaker, the energy crisis in California has been devastating communities across the western United States, and its effects are being felt across many industries. Our Nation has been blessed with an abundance of natural resources from which our energy can be produced.
Mr. Speaker, I feel that this unfortunate situation in California is one that need not be repeated, and we must work to ensure this.
At a time when we have the technology to produce energy in a much cleaner, more efficient way, we should be devising the long-term solutions to help prevent situations like the one in California from occurring again.
We are seeing the prices of services rise as the funds to pay for these services are depleting. Today, it costs more to operate businesses, drive our cars; and in West Virginia, the cost of cooling and heating our homes is rising.
Unfortunately, the demand for more energy is not decreasing, and companies are being forced to close, vital members of our Nation's workforce are losing their jobs.
With California's economy representing 13 percent of the total U.S. Gross Domestic Product, it cannot survive under these conditions; and unfortunately, a poorly thought out deregulation plan has severely damaged the world's sixth largest economy.
Mr. Speaker, in my home State of West Virginia, we have an abundance of coal and natural gas; but many of these resources have lain asleep, untapped, due partly in effect of the overly restrictive regulations that have prevented the extraction, the production and transportation of these sources of energy.
Today, many of these resources could serve as a lifeboat to our friends in the West if only we had recognized these sources' potential contributions and had been wise stewards of them.
But a decade of ignoring our domestic sources of energy and stifling energy production has unfortunately left some classrooms in the dark, some businesses offline, and some local infrastructures paralyzed. But this is not a hopeless situation, and that is why we are talking about it tonight.
This country can chart a new course for the history books, one that includes a natural energy policy that utilizes our domestic resources and promotes speedy, efficient, and environmentally-sound production of energy. We can do this at the same time by instituting meaningful means of conservation of our precious energy resources.
I look forward to working with the rest of Congress in developing the smart plan for our future, and I thank the gentleman from Michigan for engaging in this conversation.
Mr. Speaker, I look forward to the role that West Virginia will play in the development of a comprehensive energy plan for our Nation. I think West Virginia's abundant resources can be used effectively, can be burned environmentally in a cleaner fashion; and it can give us, I think, a good baseline of the energy production that we desperately need in this country. I look forward to working with the gentleman to try to solve this problem.
Mr. EHLERS. Mr. Speaker, I thank the gentlewoman from West Virginia
(Mrs. Capito) for her comments; and obviously, she is referring principally to the sources of coal in West Virginia I assume, and one of the big problems, of course, is clean coal technology.
We have to recognize, although coal has some drawbacks, it also is the largest supply of fossil fuels we have in this country by far; and in fact, that is true worldwide as well.
If we do not do the research and develop clean methods of burning coal or using it in other ways, we are going to be behind the 8-ball fairly soon, because the supplies of oil and natural gas are much shorter; and, furthermore, natural gas is useful for so many other purposes, particularly as a feedstock in the petrochemical industry; and coal is, by far, the better source of energy than natural gas.
Mr. Speaker, I appreciate the comments of the gentlewoman and thank her for taking the time to join us in this Special Order.
Mr. Speaker, I yield to the gentlewoman from New Mexico (Mrs. Wilson).
Mrs. WILSON. Mr. Speaker, I thank the gentleman from Michigan, and I was very pleased to be asked by the gentleman from Michigan to join him tonight to talk about America's energy policy and where we need to go and what should be the priorities of this Congress.
I was very pleased that the Federal Energy Regulatory Commission earlier this week put out a new order to a new rule about the way they regulate companies that had a price mitigation strategy in it. And for the West I think it will provide some immediate relief in California and also other western States without putting on price caps which have been called for by some in the House and, before this order came out, some in the Senate.
I think that that order will also help move this Congress away from a discussion of short-term Band-Aid solutions in California, to the long-
term issues and solutions and strategies that we need to address our energy future.
Mr. Speaker, I would like to take some time this evening to talk about the current energy crunch and our solutions for the long term for a very broad and balanced approach to energy policy.
Mr. Speaker, the electric bills that all of us have been receiving in the mail for electricity and also for natural gas have been hurting everyone. We need that electricity and that gas to heat our homes, to cook our food; and it is especially hurting folks on low incomes.
I was very pleased also that this House passed additional assistance for the Low-Income Home Energy Assistance Program and cooling needs for those on low incomes. Most of us do not think about energy until it becomes a problem.
We have not had a natural energy policy in this country for over a decade and arguably for 2 decades. We are more dependent on foreign oil today than we were at the height of the energy crisis in the 1970s.
Fifty-five percent of our oil is imported primarily from the Middle East, making us dependent on foreign governments, many of whom are not our friends.
California expanded its consumption of electricity over the last decade by some 10,000 megawatts of power while it only built 800 megawatts of power plants. Now, I do not understand megawatts very well, but think about it this way: if your kids become teenagers and they start drinking 10,000 gallons more milk a year, which is probably about right, and you only bought 800 more gallons to put in the fridge, you would have a problem.
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California created for itself a problem. They did not plan. They ignored the growth of California's economy and its population, and Californians are paying a very heavy price.
America needs reliable, affordable, clean energy to support our expanding economy, our growing population, and our rising standard of living. When we flick the switch, the light should go on. When we go to work, we should have the energy to produce the goods and services for our growing economy. When we fill up at the gas station, the price should be reasonable, and it should not be set by a foreign dictator. And when we come home, we should be able to enjoy clean water, clean air, and clean land with our families.
The energy crunch we face today is one made yesterday, and it will not be solved today or even tomorrow. We are not going to be able to fix this in a day. And while there are some things that we can and should do to give ourselves some immediate short-term relief, it is more important to get the long-term policies right so that we never get into this situation again. I do not believe that Band-Aids are answers, and some of the quick fixes that we have heard bandied about in Washington do more harm than good. It is long past time to have a balanced, long-term approach to make sure that we have a safe and stable supply of energy for the long term.
Now, I come from New Mexico. New Mexico is an energy producing State. We produce oil and natural gas, we have some of the country's largest reserves of uranium, and we have coal fields. Last year oil and gas alone produced about $2.6 billion worth of products to light our homes and run our industries. Living in New Mexico, and I know there are some folks in this body that would disagree with me, but I come from the most beautiful State in the Nation. I believe that we can meet America's energy needs in a way that preserves the beauty of the home that I love and the homes that all of my colleagues love.
We have made tremendous progress in the last decade on cleaning up the air and cleaning the water and finding ways of exploring for energy that do less damage to the environment. There is no turning back, and nobody wants to. The good news is that from what I have seen, serving on the Committee on Energy and Commerce, over the last half year of holding hearings and testimony and doing inquiries and gathering evidence, I do not think we have to turn back. I think we can have a balanced energy policy where we have the safe, clean, healthy environment we want and we also have the energy we need for our country. But if we are going to do that, we need to act and we need to act now. If we do not act, we need look no further than California to see the consequences for our futures: rolling blackouts, skyrocketing prices, $2 or even $3 a gallon for gasoline.
So where do we go and what do we do? How can we address this energy need in a way that is comprehensive, that does not look to Band-Aids for solutions? I think that legislation that the House should pass before the August break will have several pieces that are important. We will have conservation, we will have measures to increase the supply of energy, we must address problems with the infrastructure in this country, and we need government reform. We will also pay some special attention to the problem of gasoline prices, and I would like to talk about these things a little bit tonight.
Conservation has to be a pillar of our energy strategy, there is no doubt about that, and I do not think we have any differences in our House about that. Conservation allows us to use less energy to live the lives that we want, to live and do the things that we want to do. Refrigerators today, and I had to buy a new one recently, thank goodness my husband was home to take care of that, the one that we bought just recently uses about a third less energy than one built in 1972. Cars get more miles to the gallon today than they did back in the 1970s, and we are on the verge of breakthroughs in technology that might even double gas mileage without reducing the power and range on our cars.
Contrary to what we sometimes hear, Republicans do want to reduce the use of energy and the waste of precious resources. After all, we are conservative by our very nature. We do not like to waste things. I do not like to waste the half-eaten burrito in my refrigerator that my kids left from Taco Bell, let alone something as precious as our energy. We have home builders, like Artistic Homes in Albuquerque, that are making their businesses strong by making homes more energy efficient. Artistic Homes is unique because it is a first-time buyer home builder. They build homes at the low end of the scale and they are part of the Department of Energy's Building America program, a program that the President strongly supported in his energy plan.
I think we should look here in the Congress at changing the Federal Mortgage Home Loan programs to make it easier for first-time buyers to get an energy efficient home. If they get an energy efficient home, it not only reduces the use of energy, it reduces the monthly utility bills, and that is good for consumers as well as being good for the environment.
We have new possibilities with renewable fuels, like ethanol that is made from corn, cogeneration of electricity and heat, advances in solar power, that all hold potential for reducing our energy use and they have to be part of our national energy policy. But we cannot conserve our way out of this energy crunch any more than I can feed my family with half-eaten burritos. We also cannot drill our way out of this energy crunch. We have to have a balanced approach that addresses both conservation and increasing energy supply.
We have to diverse and increase energy supply while protecting the environment, and that is the second prong, the second strategy we will pursue here in the House. The first is conservation; the second is increased supply. As my colleague from Michigan mentioned, coal generates a little over 50 percent of our electricity in this country. Nuclear is about 20 percent. But the only plants now on the drawing board are for natural gas, and we may create a shortage of natural gas and start having to rely on imported natural gas. I think it would be a real mistake to rely only on one source of electricity generation. We need to have nuclear, hydro, clean coal, natural gas, distributed generation and renewable energy as components of our supply.
I would like to emphasize the need for nuclear energy. For 20 years, nuclear energy has been in the too hard column, almost impossible to get a nuclear plant approved in America, and yet nuclear power is cleaner than other sources of fuel. It is also safer. And the safety record has improved even further over the last 10 years. Research on new designs can change the economics of nuclear power generation.
The energy bills that we are going to work on here in the House I hope will streamline the licensing of hydropower. Most people do not know it in this country, but it takes up to 10 years to get a dam licensed with a turbine, even if the dam is already built and all you are doing is putting a turbine on water that is flowing down the spillway. That does not make any sense when there is a shortage of power in the West and we could have more hydropower without even building any more new dams. I think we will find a way to better balance and allow exploration on public lands and balance the needs of conservation environmental protection and production of new sources. So we need conservation.
We need to produce more energy and get it to the market, but to get it to the market we have got to fix our infrastructure. Now, California's problem was not just that they did not build power plants, but they did not build power lines to get the power to the people who needed it.
We also have a shortage of refineries in this country. We have not built a refinery in over 20 years. Our refineries are working at 95, 97 percent of capacity. Any safety problem or fire at a refinery immediately creates a shortage of supply. We have only one port in our country that can accept liquefied natural gas, so that we are very dependent on that port. And in an age of sophisticated remote sensing, many of our pipelines are still inspected by people who walk the line and look for discoloration in the soil.
We have to modernize and expand the infrastructure, including safe pipelines, adequate transmission and refining capacity, and enough redundancy so that we can reduce the consequences of single point failure. So we will pass conservation measures, we will pass increased production, we will pass bills to make infrastructure stronger in this country, but we also need government reform.
The Federal Government does not integrate well its energy policy, environmental and economic and foreign policy-making so that we can avert energy problems. I am sure it is probably no surprise to anyone in this body that the Federal Government is not exactly one large well-
oiled machine that gets everything done efficiently. Right now the Environmental Protection Agency or the State Department or Transportation or Agriculture or Interior can make policy decisions that affect our Nation's energy supply without ever having to think about our energy supply. They can make those decisions based solely on their department's view of what the right thing to do is; their constituency. They do not have to worry about what it does to the price of gas in Belen, New Mexico or how much it costs to heat our homes.
Now in a crunch time, like today, those agencies are forced to consider energy as part of their policy-making; suspend some rules, accelerate some procedures. But when public attention subsides, goes back to business as usual, and bureaucrats do not have to think about energy, I think that we have to integrate Federal policy when it comes to energy so that we can prevent this situation from ever happening again.
We have a national security policy-making apparatus that seems to work. We have had it in place since 1948. We cannot have the Defense Department doing one thing and the State Department doing something else and the intelligence agencies doing something completely different. They must work together toward a common national security end. It is long past time that we do the same for energy and that we have a policy-making process that takes into account America's energy security.
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So those are the strategies that will define how this House and how the Republican majority in this House will address the challenges of energy for this country.
We will focus on conservation. We will take measures to increase supply. We will address our crumbling infrastructure, and we will engage in government reform. We will also pay some special attention to gas prices.
Mr. Speaker, I filled up over the weekend in Albuquerque, and it cost me $1.57.9 for a gallon of gas, and that was lower than the last time I filled up which was after a price spike. In May, the Federal Trade Commission completed an investigation into gas prices last summer, and found there was no price gouging, but there were some other problems. For instance, we have 20 different formulas for what gasoline should be and State and local government can set different standards at different times of the year.
When Milwaukee's formula is different from Chicago's, and they change their formula in different weeks of the year with different requirements on whether the gas station has to drain its tanks first and so on, you can easily see where there are local shortages of supply of some kinds of gasoline. In any free market, a shortage of supply means an increase in price.
Mr. Speaker, one of the helpful things that we can do at the Federal level to keep gas prices down is to establish regional formulas for gasoline. It does not mean that we are going to change the result of the standard and the desire for clean air, but just to say that instead of 20 formulas, let us go to some regional formulas and get our formulas aligned so we do not create problems for ourselves and for consumers.
I also mention that we have a problem with refining in this country and that we have not built a new refinery. As I understand it, refining has about a 4 percent profit, and they have a lot of hassle and risk with safety and permitting problems. We need to explore ways, changes to Federal rules or tax policy so we can see an increase in refining capacity so we are not so tight on refining all of the time.
Third, with respect to gas, a third of the oil that we import is for our cars. Making our cars more efficient with more miles to the gallon, alternative fuels and research into hybrid vehicles like combined electric and gasoline motors will reduce the demand in the price of gasoline and reduce our dependence on foreign oil.
We also need to look abroad. We know that much of the known reserves of oil are in the Middle East, but there are also some potential sources of oil in the states of the former Soviet Union. We are going to have to work with those states, looking at the Caspian and in Central and South America and offshore so we can look at developing alternative sources of supplies. It is when the cartel holds all of the cards that we are at the whim of the world's dictators.
I appreciate the gentleman from Michigan's inviting me here. I think the comprehensive energy legislation that we plan to pass in the House this summer is based on some sound thought. It will include conservation, increased production and strengthen our crumbling infrastructure, and it will include government reform.
I think with this comprehensive energy legislation, this broad-based, long-term approach to the challenges we face in America we can have energy security. We can have a safer, cleaner, healthier place to live and meet the growing needs of our prosperous Nation.
Mr. Speaker, I thank the gentleman from Michigan for sharing his time with me.
Mr. EHLERS. Mr. Speaker, it is a delight to yield the gentlewoman the time. I appreciate her very well-said comments.
Picking up on a few items that the gentlewoman mentioned, she mentioned that price caps would not be a good answer. I would like to emphasize that. If we impose a cap on the price of energy, we are simply encouraging people to buy more energy and waste it because the price is so low they can afford to waste it. That furthermore discourages the production of more energy because if the price is capped, a company cannot make money producing more energy. So price caps are doubly a bad idea. They discourage production and encourage waste and make the problem worse.
I also appreciate the gentlewoman's comments about efficiency, and the comment about the refrigerator reminds me of an incident. I remember when my wife and I first married and we lived in apartments, and then we moved into an unfurnished house and had to buy a refrigerator. We shopped around and looked at many models and narrowed it down to two different models, one for $250 and one which cost $500. Remember this was roughly 1962.
So then I did an analysis of the energy use of the two refrigerators, and I said we have to buy the $500 one. That seems strange, why should you buy the $500 one when you can get an identical one for $250. The difference was efficiency of operation. I calculated if we kept the refrigerator 12 years, we would more than pay for the extra $250 we bought and anything beyond that would be an added benefit. In fact, we kept the refrigerator over 23 years. So we essentially got it free compared to the other one given the purchase price and the energy use of the other one.
That is a calculation that not too many Americans are able to make because not all Americans are physicists, as I am, but it was easy to do and that illustrates the importance of labeling energy efficiency. And I think it would be important to have labels which indicate what the pay-back period is for buying a particular model.
Another item which the gentlewoman mentioned is the issue of foreign oil.
I remember the so-called energy crisis of 1973 when we had long gasoline lines, cars lined up for blocks waiting to get gasoline. I remember those days very, very well. At that time we were horrified when the Nation realized that roughly 35 to 40 percent of our oil consumption was imported from abroad, and that these foreign companies were able to Shanghai us literally by saying we are going to cut production in order to raise our prices, and we ran out of oil.
We thought that was terrible. We went into energy conservation mode. We did a lot of good things. We did greater production of energy and so forth. But we have short memories. It was not too many years when we forgot that, and now we are at a situation where we are importing a minimum of 55 percent of our oil from other countries, and it continues to climb.
Furthermore, it is no longer an option really to increase our production the way we did in 1973 because we have used so much of our own resources. At this point only 2 or 3 percent of the known reserves of the world are in our country, and the rest is all foreign oil. So we cannot simply rush out and increase our production because we have used most of the cheap oil in this country. It would be a great cost to produce a good share of our oil from within this country, barring other technical developments. Therefore, we will continue to be at the mercy of foreign oil unless we develop alternative sources of energy, unless we improve the efficiency of using our energy.
Mr. Speaker, I want to thank the gentlewoman for her comments and emphasize those few points because I think they are really extremely important.
Getting back to what I said at the very beginning of this hour, energy is far more important than most people think it is. Part of that I believe is that energy is intangible to us. We cannot see it. We cannot touch it. We cannot feel it. We cannot taste it. The only tangible evidence is the price at the gas pump or the utility bill at the end of the month. That is when we get concerned.
But if energy were only purple, if only we could see energy and we could see what happens in our house where energy would be oozing through the walls and the walls of the house would look purplish, and we could see it streaming out around the windows that are not sealed and we would have this copious amount of purple coming at us. Or we would see the small car with a small amount of purple, and the SUV would go by with a purple cloud so bad we could not even see the vehicle.
If we could see the intrinsic qualities of energy and see when it was being wasted, I think we would change our habits considerably. Unfortunately, we do not have that advantage, so we have to try to educate ourselves about energy and try to make the best possible uses of energy.
There are a lot of ways that we save energy, in terms of buildings, insulation, reducing infiltration of outside air. Improved lighting has a surprising large effect. Light bulbs are only a hundred watts, that is not very much, but in 1974 when I decided to change the lighting in our house and I put fluorescent lights and fluorescent bulbs in every fixture that was used frequently, and I was surprised by the energy saved.
When I sealed the house with insulation, we saved over a third in our energy bills for our house, our natural gas bills. So there is a lot that can be done.
In industry, improving efficiency of electric motors. New electric motors are much more efficient. Also, by using appropriate controls adjusted to the load, we can improve our efficiency and use of electrical energy.
We can also, with automobiles, consider making better use of the diesel engine. I owned two diesel vehicles in the 1980s, and I found them wonderful. The most wonderful part was driving 800 miles between gasoline stops. They are very efficient and operate well.
There are fuel cells on the horizon, and this relates to the whole hydrogen economy. If we can manage to produce hydrogen cheaply enough and transport it, and we develop fuel cells, that will be an advantage.
Hybrid automobiles are also a good answer. So there are many things that we can do to improve energy efficiency and use less energy.
We also have to worry about the pollution effects of energy use as well, and we have tried very hard in this country to clean up our air. We have succeeded to a great extent. We have far less pollution from automobiles than we did in my youth. And a few years back when my daughter was a missionary in Costa Rico with her husband, we were amazed by the pollution there. It made me appreciate more what we have done in this country.
Even so, we still have problem with nitrogen oxides of various sorts getting into the air. And as long as we have sulfur in the fuel, we are going to continue to have problems with sulfur dioxide getting into the air, which of course when it combines with water vapor makes sulfuric acid and leads to what is commonly called acid rain.
Those are pollutants we must clean up and will eventually clean up, either through other means of propulsion, such as fuel cells, or some other way.
In addition to that, we have copious production of carbon dioxide, a greenhouse gas. In addition to that, because we are using a lot of natural gas and we continue to drill wells, there is leakage of methane which is 100 times more of a greenhouse gas than carbon dioxide. That is leading to potential major changes in our global climate.
Mr. Speaker, I do not like to talk about global warming because the real issue is global climate change. That means much more than just warming. It means dramatic changes in rainfall. Some areas that have much rainfall now might become deserts, deserts might become fertile areas, depending on changing patterns. And it also has an effect on violent weather.
These are issues we have to consider. With our copious use of fossil fuels, these are going to become major effects.
I think we have only begun to see the effects of improved means of producing energy. We are so used to our current model we think that is the only way. But I predict because of the difficulties in California, we are going to see a boom in what is called micropower, where small power units are purchased, perhaps sometimes in homes, more frequently perhaps in businesses, especially in manufacturing plants.
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The Silicon Valley, which is famous for the work they have done in semiconductor chips, has had some disastrous occurrences of power outages in California. Just shutting the power off for 1 minute at a major plant like that costs them $1 million. If the electricity is off much longer than that, of course, the cost increases. So I suspect many of them will turn to smaller power units, which are kept right in the factory and are totally dependable. If they ever do fail, generally the power lines would still be operating and you could use them as a backup.
We have to also develop many different alternative forms of energy. I could name many that are available. I expect that within a few years, with increases of electricity prices, we will be putting solar shingles on houses, photovoltaic shingles that will provide electricity, perhaps initially crude electricity that would be good only for heating the water and providing heat for the home, perhaps air conditioning; but eventually with proper electronics, it can be sophisticated power and supply all the energy needs of the house.
Everyone, of course, says, What happens when the sun goes away? Well, then you need energy storage devices. Batteries are one form of that; but if you want to, you can get a little more sophisticated. You could electrolyze water into hydrogen and oxygen; when you need energy, you combine them again in a fuel cell, and that would provide electricity for the house, so you could be totally independent of the power grid. These are all things that might be considered in the future.
I always like to, when looking at our energy sources, characterize them in terms of personal finances, because I think you can look at it that way. When we consider our personal finances, first of all we have income from a job, a profession, whatever we have. In addition to that, many of us have savings accounts, where we keep some money for emergencies. And some are fortunate enough to have an inheritance. We have exactly the same situation with energy. We have income, the solar energy which streams onto our planet. The amount that streams on the earth is so immense that the amount contained in all the fossil fuels of the earth is less than a couple of weeks of solar radiation. The problem is that it is so diffuse, it is hard to use. But nevertheless we can develop means of using that. That is our only income, of energy, solar energy. That is the only energy coming into our planet.
In addition to that, we have a savings account. That is the fossil fuels, the oil, natural gas, coal. Those are stored fossil fuels, stored solar energy. They were created from solar energy that came into the earth for a very long time. It formed in plants. The plants then eventually decayed and formed the organic by-products that give us oil, natural gas, and coal. So we have a savings account. That is the fossil fuel that is in the earth.
And then we have what you might call an inheritance. Geothermal energy, for example, the heat that is in the earth and has been there since its creation gradually radiating into space, but there is an immense amount there yet. The core of our planet is molten iron, obviously very warm. So geothermal energy, we can consider an inheritance. We acquired it when we were placed on this planet. Another inheritance is nuclear energy, because that also was present at the creation of the earth, continues to release heat constantly, in fact contributes much of the heat of geothermal. So nuclear energy we can also consider an inheritance.
I think the rule of thumb that we have in our life, as far as our finances are concerned, that we try to live within our income, when necessary we will dip into our savings or our inheritance, is also a good rule to follow in energy use. I think it would be absolutely criminal if we were in a generation or two to burn up all the fossil fuels on this planet without thinking about what our children and grandchildren are going to do.
Now, I do think it is permissible to use a good share of the fossil fuels if we use that energy to develop new sources of energy, to make better use of nuclear energy, of geothermal energy and other sources that we might develop or invent. That is fine, because we are leaving our children and our grandchildren another way of using energy. But we have to always keep that in mind and be very careful of the use of the resources we have.
Two very important factors to remember about energy: number one, energy is a unique resource. It is our only nonrecyclable resource on this planet. Once you use it, it is gone. It is not like iron, copper, other materials that can be recycled over and over. Once you use energy, it is gone. Energy is our only nonrecyclable resource. The other major factor is energy is our most basic natural resource because without it you cannot use any of the other resources. You cannot use iron if you do not have energy because to use iron, you have to first dig the ore out of the ground, that takes energy; you have to transport it to a mill, that takes energy; you have to smelt it, that takes energy; you have to roll it, that takes energy; then transport it to a factory which takes energy; and then fabricate it, which takes energy. And then use more energy to transport the finished product to the consumer. Every step of the way requires energy. If you do not have sufficient energy, you cannot use any of the other resources on the earth.
I think we have spent a lot of time talking about some of the basic nature of energy here and some of the problems we have to face. But I think it is very important to keep all of these factors in mind as we attempt to solve the energy shortages we have. I think the energy resource problem we have is not one that we can solve with a magic stroke of legislation or we can solve through new development; but it is something that is going to involve millions of individual efforts by millions, and in fact billions, of people on this planet to make it come true. The government cannot conserve energy for everyone. We all have to do it. We have to use energy resources wisely. It is not just up to the government. It is up to the people of this planet to do it.
I yield to the gentlewoman from New Mexico for additional comments.
Mrs. WILSON. I thank the gentleman for yielding. I really wanted to emphasize something the gentleman from Michigan said early on in his remarks about price caps. There was some discussion about it here on the floor today. It is amazing to me that even after the Federal Energy Regulatory Commission made its decision on Monday to go after a market-
based solution, they call it a price mitigation solution, it takes into account changes in the market day to day, that there are still folks who want to say, Well, prices are too high, so let's have the government set what the price is. That did not work in the 1970s. It has not worked for any kind of commodity. And it would really make things so much worse, would make the pain much longer and much more intense than it is today.
The reasons for that are really pretty simple. First, if something does not cost as much as it really costs, then people are not as careful about not wasting it. I know that is true of me. When you are paying $1.57.9 for a gallon of gas, you start planning the way you are going to do your errands on Saturday so you do one trip instead of two. You tell the kids to turn the lights off. You get smart about the way you use energy and think about things and whether we really need to turn the air conditioner on as much as we do or whether we turn it off when we are going to leave for the weekend.
The second thing that it does is, the real problem in California is they just did not build enough power plants. They grew their economy, they grew the population considerably and figured that they would import the power from other places. If you put on price caps and you create huge uncertainty in the industry, nobody is going to go in and say, Yeah, I'm going to take my savings; I'm going to invest in a new power plant, if you do not know whether you are going to be able to recover your investment. So it does not solve the real problem, which is supply. A price cap does not produce one more kilowatt of electricity.
Then the other thing I think it would cause is the reality now that California is dependent on importing electricity from much of the West, including the State of New Mexico. If you put on price caps, you will not be able to buy some power, because people will not sell it to you if they have to sell it to you at a loss. We could make this so much worse. I do not understand why there are still some in the Congress who think the right answer is for us to legislate the price of power. It would be a disaster for California, for the West.
I am glad the Federal Energy Regulatory Commission took the steps that it did, and in fact I was one of the 17 Members of this House that signed a letter asking them to pursue this strategy, a market-based strategy of price mitigation. But really we need to shift and focus on the long-term policies that we need. I do believe that we need a balanced and long-term policy. It has got to include conservation, both conservation by individuals but also the government in systemic efforts that we need. If I go to Baillio's, which is our appliance store, if I do not have a choice of an energy-efficient refrigerator, then I really cannot conserve in that way. There are some things that government must do to make sure that conservation works and that it is not just my decision to turn on or off my lights, but a decision and an encouragement to invest in efficient lighting systems by industries or, for example, the Building America program I mentioned.
The interesting thing about the Building America program and the way that it has changed the building of homes is it is not just adding another layer of insulation in the attic, which we have done that, too. It is the changing the design of the home, starting from the ground up, on making it energy efficient. The savings are just incredible. That is really important for first-time buyers who are looking at how much can they cover on their mortgage, how much house can they get for their money. If the cost of maintaining that house is maybe 10 or 15 or $20 lower, that can go to a mortgage payment rather than to the electric bill. So building from the ground up is very important.
Those are things that we can encourage and do through government. We have got to increase supply, no question about that, in order to reduce our dependence on foreign oil. The gentleman mentioned it, and I think it is worth repeating, 55 percent of America's oil comes from outside the United States. The fastest growing supplier of oil to America, and the number six supplier to America, is Iraq.
Most folks do not know that Saddam Hussein probably has more impact on American gas prices than any of us would wish to admit. I noticed an article in the paper on Monday, they are reconsidering sanctions on Iraq. And not a surprise, every time they do that at the United Nations, Iraq decides that it is going to turn off its spigot and tell the rest of the world that they have us by the short hairs. I do not want to be by the short hairs with Saddam Hussein, which means we need to reduce our foreign dependence on single sources of supply so that when one individual dictator says, Well, I'm turning off the spigot, we have other sources, we are not over a barrel, that our energy policy is not just going on bended knee to other governments and begging for oil. That is not a policy. That is a plea. We should not put ourselves in that situation.
So we have got to have conservation, we have got to have exploration, we have got to build our infrastructure and take care of some of the infrastructure problems that we have, and we need real government reform. I think that that is the recipe for a stable, long-term policy for energy independence in this country. I appreciate the gentleman's efforts to bring this session to the House.
Mr. EHLERS. That was an excellent summary of what we have been trying to convey this evening. I thank the gentlewoman from New Mexico for her comments.
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