America's Energy Security

Samuel Bodman
Despite what you may have heard, President Bush has been a leader in addressing climate change. His administration has invested nearly $29 billion in climate- related science, technology, international assistance and incentive programs. In 2003, the President set a target of cutting our greenhouse gas intensity by 18 percent through the year 2012 and we are on track to meet that goal.

The proposals the President put forward last night in the State of the Union to reduce gasoline consumption by 20 percent by 2017 by establishing alternative fuel requirements and fuel efficiency standards are good for our energy security, but are also good for our environment thanks to the reduction in greenhouse gas emissions that will accompany the cuts in gasoline use. In fact, we believe these proposals could reduce projected emission in 2017 by roughly 175 million metric tons –equivalent to what 26 million automobiles produce in annual emissions.

The approach we are taking is both science and market-based. We believe that, by encouraging innovation and breakthroughs in science and technology, we can reduce emissions and sustain economic growth – something the inter-agency Climate Change Technology Program is developing strategies to do. It is vitally important that the economy continue to grow so that it will generate the capital necessary to finance private investment in cleaner, more efficient technologies.

Lastly, through the Energy Policy Act of 2005 and the President's Advanced Energy Initiative, we have proposed and enacted a series of tax credits that make it cheaper to purchase hybrid and flex fuel vehicles and to install the infrastructure needed to fuel them. These tax incentives have helped American consumers buy more than 250,000 fuel-efficient vehicles since January 2006. So we think we're making progress.

Matthew, from New York, New York writes:
If you are planning to use nuclear energy as an alternative to petroleum, what are you going to do with the extraordinarily dangerous waste product in the long term and in the quantities necessary to replace petroleum?

Samuel Bodman
There is an emerging consensus that nuclear power must be part of America's energy future. Thanks to improvements in technology, the newest generation of nuclear plants is safer than ever and still produce affordable power without producing carbon emissions.

But to bring about the nuclear renaissance America needs, we need a rational, safe and secure way to manage spent nuclear fuel. DOE is developing a permanent geologic repository for that waste in the middle of the Nevada desert at Yucca Mountain.

We're making progress on Yucca Mountain, but it has been delayed for a variety of reasons. And while Congress has approved the Yucca Mountain site before, we need the continued support of Congress to complete this project. The longer we wait, the longer spent nuclear fuel sits at numerous sites around the country.

Samuel Bodman
Coal is an important source of energy today and will be for centuries to come. But in addition to coal, we need to use more energy sources in order to diversify our nation's energy mix and strengthen our nation's energy security.

That's why the President's Advanced Energy Initiative, includes investments in a number of energy sources including clean coal, nuclear, wind, and solar power.

The concern with using coal is the environmental impact, and that's why we are researching new technologies that will allow us to use our vast resources of coal in an environmentally sensitive way. We are looking at techniques that will improve technologies in coal plants that are already producing power in order for them to reduce emissions. In addition, we're looking at new technologies that we can use in future plants – technologies like and also in carbon sequestration, where the carbon is actually pumped into the Earth instead of into the air. All of this work will culminate in one of our most exciting projects: FutureGen. This is a $1 billion project aimed at designing and building the world's first commercial scale, coal-fired power plant that produces no significant emissions of carbon or pollutants into the atmosphere. This is an international partnership that will allow the rapid deployment of these new emissions-free technologies around the globe so that the entire world can harness the power of clean coal in a way that environmentally sensitive.

Samuel Bodman
The President has a real and firm commitment to using alternative energy sources to reduce America's dependence on foreign oil. The President's 2008 budget request will include nearly $2.7 billion for the Advanced Energy Initiative to expand our national investment in alternative fuel and clean energy technologies.

As the President said last night during his State of the Union, it is vital that we diversify America's energy supply – and that the way forward is through technology.

Thanks to the Energy Policy Act of 2005, we have increased dramatically the number of available wind-generated power. The U.S. wind energy industry installed 2,454 megawatts of new generating capacity in 2006, an increase of 27 percent. To put this in perspective, one megawatt of wind power produces enough electricity to serve 250 to 300 homes on average each day.

Also, while I was with the President this morning in Delaware, he announced his new Executive Order directing all government agencies to effectively consider, manage, and work to mitigate their environmental and energy footprint.

We need to lead by example. The federal government is the single largest user of energy in the world, so we have the greatest potential for employing energy savings.

In addition, we are a large purchaser of energy, so we can drive innovation through our financial commitment. The Order instructs government agencies to purchase significant portions of their energy from renewable sources. By doing this we can spur capital investment in the renewable energy infrastructure that will have residual benefits to the public, by increasing and expanding the production, efficiency, and distribution of renewable energy to all consumers in the country.

Samuel Bodman
Things have improved greatly since the 2003 blackout. We identified the causes of the blackout and progress is being made to implement the recommendations made by the U.S.-Canada Power System Outage Task Force.

The first and most important recommendation of the Task Force was that the U.S. Congress should enact legislation to make compliance with reliability standards mandatory and legally enforceable, which the Congress did in the Energy Policy Act of 2005. These mandatory standards will do a great deal to improve reliable electric service.

In addition, we are looking at areas around the country where there may be areas of electricity congestion. As demand for electricity increases, we will need to strengthen our electricity delivery system.

So in August, the Department published the National Electric Transmission Congestion Study. The report identifies three groups of major or significant congestion in the electricity grid that merit further federal attention. Since the study was released, we have been receiving public comments and look forward to putting out a final report soon, which I hope will help alleviate the stress of our infrastructure and further protect all citizens against future blackouts.

Samuel Bodman
My view of the future is much more optimistic than yours. You see, I've spent my life betting that the future will be better because of the power of American science and innovation in addressing our challenges. And that view has served me well. So I am optimistic about the future as is the President.

That doesn't mean that we can sit back and let things happen. We need to continue to take action if we are to shape our future. Today, the President issued an Executive Order that directs the federal government to lead by example when facing the nation's energy and environmental security challenges.

Among the things this new Executive Order will do is require the federal government to work to reduce federal petroleum consumption in fleet vehicles by 2 percent per year through 2015 and increase use of non-petroleum-based fuels.

We are also taking action to reduce greenhouse gas emissions intensity in the United States. We have invested $29 billion in clean energy science and technology research.

We have seen that research in developing and ultimately deploying clean energy technology holds great promise here in the U.S. and in the growing industrial economies across the world. These clean alternative energy sources and components include solar, wind, ethanol made from grass, agricultural wastes and other materials, clean coal technologies, coal to liquid fuels, better batteries for hybrid and plug-in cars, photovoltaic solar cells, hydrogen fuel cells and flexible vehicle fuels.

This research is paying off handsomely. We're past the "Could we…" stage of our research in many of these areas and are well into the “What is necessary to get these to market efficiently and as cheaply as possible” stage. The future is bright. Technology, like what we are developing at the Department of Energy's national labs, is bringing us closer and closer to things few people ever thought would be possible. So I'm optimistic about the future – and I hope you will be too.

Samuel Bodman
The U.S. government is the world's single largest purchaser and user of energy. The energy goals the President laid out in last night's State of the Union will, even as we begin to meet them, contribute to greater American energy independence and a reduction in our dependence on foreign oil – especially the imports that come from areas of the world populated by regimes hostile to the United States.

We have a responsibility to increase America's energy security, and one way to do that is to ensure we have enough petroleum to mitigate any significant supply disruption.

We currently have about 690 million barrels of oil in the Reserve, which is the equivalent of all of the crude oil we would import over the course of 55 days. By expanding our Reserve to 1.5 billion barrels, we would have the equivalent of 97 days of net import protection.

Now I know, that doubling the Reserve sounds like a huge undertaking and it sounds like we'll be taking a lot of crude oil off of the market. However, by expanding the Reserve over 20 years we will have a negligible impact on a market that buys and sells 89 million barrels of crude oil a day.

And I want to ensure you and every other American that we will engage in this process that is deliberate, predictable, and transparent manner whenever we buy crude for the Reserve. In case you are interested, here is my statement on the Expansion of the Strategic Petroleum Reserve.

Samuel Bodman
We're almost there. Last year alone about 4 percent of our fuel came from corn-based ethanol. But we can't stop there. The President announced last night his goal to reduce America's use of gasoline by 20 percent in the next ten years. America is close to breakthroughs in technology that will further decrease our dependence on foreign oil. The proposals the President made last night build upon the advances made possible by our previous initiatives, including the Energy Policy Act of 2005, the Advanced Energy Initiative and the American Competitiveness Initiative.

The President's plan to increase the supply of renewable and alternative fuels by setting a mandatory fuels standard to require 35 billion gallons of those fuels be used is nearly five times the 2012 target now in law. It will reduce oil consumption by 2 million barrels per day, or ten percent, in 2017 and displace 15 percent of projected annual gasoline use.

The President's plan to reform and modernize CAFE standards for cars and extend the current light truck rule will reduce projected annual gasoline use by up to 8.5 billion gallons by 2017, an additional reduction of five percent.

So, taking these policies and turning them into practice, we can have a profound reduction in our use of imported oil.

Samuel Bodman
It is true that some critics claim the production of ethanol is not efficient, arguing it requires as much energy to produce as it generates. But nine major studies done since 1995 show that corn ethanol contains, on average, about 30 percent more energy than the fossil fuels needed to make it.

In 2005, the U.S. produced 4 billion gallons of ethanol--and we are on track to produce a lot more. This can help us meet the President's goal of significantly reducing the amount of oil we import and, by blending or using as a gasoline additive, extend the fuel supply.

Ethanol also significantly reduces tailpipe emissions and releases fewer greenhouse gases into the air. In 2005, use of ethanol reduced carbon dioxide greenhouse gas emissions by approximately 7.8 million tons, equivalent to removing the annual emissions of more than a million cars from the road.

Samuel Bodman
As I mentioned, the President and I went to Delaware earlier today to see examples of cellulosic energy research underway at the DuPont Experimental Station. After seeing what they are doing there I can say with even more confidence that technology is going to carry the day as we try to meet our future energy needs, securely and in an environmentally sensitive manner.

As always, it has been a pleasure to respond to your thoughtful and challenging questions. I hope I've been able to give you some additional perspective on how we are working to build a stronger, more diverse, and more environmentally friendly energy sector in the United States, and around the world. And again, you can find more details on all the programs I've mentioned -- as well as information on what else our Department is doing -- on our web site at www.energy.gov.

Thank you for participating.