Preparing the way for the Administration’s energy policyexpected in the next couple weeks, Energy Department SecretarySpencer Abraham warned a meeting of the U.S. Chamber of Commerce”the nation faces a major energy supply crisis over the next twodecades.”

Abraham blamed the Clinton Administration’s do-nothing energypolicy for the situation today of surging demand, which at the sametime expansion of the infrastructure for energy production andtransportation is frustrated by regulatory structures and policies.

Abraham defended opening the Alaska National Wildlife Refuge,noting development would affect only 2,000 acres out of more than19 million, and it would add between 5.7 and 16 billion bbl of oil.

But it’s not just in Alaska that access to resources areblocked. “Right now, an estimated 40% of potential gas resources inthe United States are on federal lands that are either closed toexploration or covered by severe restrictions,” Abraham said. Thegas transportation system “will require an additional 38,000 milesof transmission pipeline and 255,000 miles of distribution lines— at an estimated cost of $120-$150 billion.”

Meanwhile, California’s power crisis “is not isolated, it is nottemporary, and it will not fix itself.” More power generation unitsand massive replacement and expansion of the electric transmissionsystem will be required to keep the lights on across the country,he said. The energy secretary noted the huge cost to Californiabusiness of the power shortages over the last year and the threatto the national economy of short supply, which engenders highprices.

“This nation’s past three recessions have all been tied torising energy prices — and there is strong evidence that thelatest crisis is already having a negative effect.” The DOEsecretary pointed to a $2.3 billion loss in wages, sales andproductivity for Californians over a two-week period in Januarywhen power shortages led to industrial shutdowns and black-outs(which are recurring today, see separate report).

Abraham promised “Our national energy policy will becomprehensive. It will reach across every department that touchesthe energy marketplace — from the Interior Department and the EPAto the Transportation Department and the DOE.” And it will do allof the above without price controls. “Let me be clear: the BushAdministration does not support price controls.”

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