Speeches & Floor Statements

Floor Remarks of U.S. Senator Lamar Alexander (R-TN) “Energy Issues in the Budget”

Posted on March 12, 2008

Mr. President, we are talking this week about the Federal budget. Senator Gregg, Senator Grassley, and others have pointed out, with appropriate response from the Senator from North Dakota, that in our belief we will wreck the Federal budget by raising taxes and increasing debt. At the same time we have an obligation on our side to say what our plan is, and we have a pro-growth Republican plan which we have been detailing this week which focuses on lower taxes, less government, lower energy costs, making health insurance affordable for every American, without the Government choosing your doctor, support for better schools, the support for the kind of investments it takes to increase science and technology. That has been our plan. That has been our pro-growth economic plan to help balance the family budget. So while they would wreck the Federal budget, we would help balance the family budget, and no part of that would be more important than dealing with energy costs. Energy costs to most American families worried about the family budget come down to $3.50 gasoline or electric bills that might be constantly rising. We have the goal of making sure that in this Nation, which consumes 25 percent of all the energy in the world, that we have a realistic policy for making sure we have a low-cost supply of clean electricity, dealing with the clean air issues -- nitrogen, sulfur, and mercury -- and with the climate change issue, carbon, that we have a low-cost supply of clean electricity and that we gradually begin to reduce our dependence on foreign oil so we can clean up our environment, No. 1, and so we can stop shipping billions of dollars to people who are not friends of the United States, and so we can lower the price of gasoline over time to help balance the family budget. We will have other opportunities during this year to offer proposals for keeping energy costs low, realistic proposals, not proposals that fit some desert island which uses electricity occasionally but for the United States which uses 25 percent of all the energy in the world and whose demand for energy is growing, not declining. For example, in my part of the country, in Tennessee, we have the Tennessee Valley Authority, which is the largest utility in the country. It covers several States. They operate at about 27,000 megawatts all the time. Sometimes they go as high as 33,000 megawatts. That is 33 big, new nuclear power plants and twice that many gas or coal plants. All that electricity for our local region as supplied by the Tennessee Valley Authority. So we have selected five different proposals which would create a deficit-neutral reserve fund to lower energy costs for families by encouraging energy efficiency on the one hand and increasing oil and natural gas supply on the other. There are only two ways we can reduce the price of gasoline or electricity. One is to increase the supply and the other is to reduce the demand. There are other ideas, but particularly in a big economy that is what we need to do. No. 1, the Senator from Maine, Ms. Collins, has suggested one way to increase the supply of clean electricity would be to allow the Finance Committee or the Energy Committee to encourage the use of biomass by enacting legislation that would encourage the replacement of old, pre-1920s wood stoves with new EPA-certified wood pellet or corn stoves, Environmental Protection Agency certified. These new EPA-certified stoves will help families save money on heating bills because the new stoves are up to 50 percent more fuel efficient than the old stoves. Given the rise of oil and natural gas prices, this idea would produce savings that would be much appreciated by families in Maine, all of New England, and in much of America. Secondly, the amendment allows the Finance Committee or the Energy Committee to encourage energy efficiency by enacting legislation that rewards the installation of smart electricity meters in homes and businesses. Let me give an example of what I mean by that. With this chart, we see how electricity is generated in America today. This is the reality. Half of it comes from coal, 19 percent from nuclear power, 7 from hydroelectric, 1.4 from biomass -- that is what Senator Collins is talking about -- and 20 percent from gas. We don't want the gas to go up because when it does, the price of natural gas goes up, and our chemical companies move to other parts of the world. Farmers pay four times as much for fertilizer. So we need look for another way to create clean electricity. The first way to do that is through conservation. Let me take the hometown example of Tennessee. The TVA is a big utility, maybe the biggest in the country, $10 billion of revenue a year. I saw an article in the newspaper that said if we have plug-in hybrid cars, we will create a lot more pollution because we will have to build new plants such as coal plants. That is dead wrong because the Tennessee Valley Authority, even though it operates at 27,000 megawatts on the average every day, that is between 3 and 7 o'clock when we are all turning on lights, coming home from work, using our electricity. The TVA has lots of spare electricity to use at night, 7 or 8,000 megawatts. That is 7 or 8 nuclear plants for the Tennessee Valley Authority. We could plug in our hybrid cars in the middle of the night without building another new nuclear plant, another new coal plant, another new any kind of plant because we have excess capacity in our region and so does virtually every other part of the country. We encourage consumers to use smart meters so they know that electricity is going to cost more between 4 and 7 o'clock and less at night. Then if the car companies wanted to develop a plug-in hybrid car with advanced battery technology, we can operate on that electricity and reduce our dependence on foreign oil without building any new plants for that purpose. So that is the second proposal we have. The same applies to water heaters. People have their water heaters on at all times. Any utility should be able to make an agreement with the Senator from New Jersey or the Senator from Tennessee or from Colorado to say: Turn your water heater over to me and some of your other appliances, and I will turn them off and on at peak hours so your electric bill will stay flat or go down. We could save enormous amounts of electricity and avoid building new plants. That is what this amendment would do. This would permit us to clean up existing coal plants. Here is how we would propose to do that. Forty-nine percent of our electricity is produced by coal. We are the Saudi Arabia of coal. Other countries in the world are building coal plants because it is the technology they know how to build. Some people are putting up large wind turbines. We are spending $11 billion of taxpayer money on wind turbines, but it is hard to find wind turbines on this list for the United States because it doesn't produce much energy. But coal does. What we need to do is clean up the coal production. This amendment would allow the relevant committees of Congress to give tax credits to recapture the carbon that comes from coal. A great many people are concerned about climate change and the use of carbon. This would help meet that demand in a realistic way in the near term. A fourth idea: I said earlier there are two ways to lower the price of $3.50 gasoline. One is more supply, and one is less demand. The advanced battery technology car, the plug-in hybrid car that runs more on electricity than it does on oil, will help reduce demand. We have a proposal for that direction. Another proposal -- and I am sure the Senator from New Mexico will want to say something about this -- is the idea of, in appropriate places, using our existing oil and gas that exists offshore. Two years ago, the Senator from New Mexico, then chairman of the Energy Committee, pushed through legislation that permitted us to expand drilling in lease 181 in the Gulf of Mexico for oil and gas. We took some of those revenues and helped mitigate some of the problems that exist on the coast; in other words, used it for conservation purposes. For the first time, we put some of those revenues into the land and water conservation fund on a permanent basis, which has been a 40-year goal of the conservation community. The Senator from Colorado, Mr. Salazar, was key to that effort. I am proud of that bipartisan effort. We could do more of that. This amendment doesn't specify exactly what we would do. That would be up to the authorizing committees. But an example of the next step might be to allow the State of Virginia, as it has asked Congress to permit it to do, to go 50 miles out and look for gas and then take half the revenue and put it in a trust fund for the State of Virginia to improve beach nourishment or to keep taxes down or to have a trust fund so the already excellent higher education system can be among the best in the world. If I were Governor of Virginia, I would want to do that. I was Governor of Tennessee, and we don't have an ocean. But many States do. If they asked for that and if they can produce more oil and gas, which will lower the price of $3.50 gasoline, then they ought to be allowed to do so. Finally, oil shale development -- the Senator from New Mexico will direct more of his attention to the oil shale development issue -- the amendment would allow the Energy Committee to enact legislation that would increase domestic oil supplies by allowing the development of oil shale deposits in green basins in Colorado, Utah, and Wyoming. So what we have suggested is an amendment that is sponsored by Republicans, but we hope it is compelling enough to attract a great many Democrats to support it. It is an amendment that will help balance the family budget by lowering the cost of energy. It would be the Collins amendment to help use biomass -- wood pellets, corn -- in more efficient stoves in New England and other parts of America. It would be to create incentives for electricity meters, smart meters which could make more effective use of hybrid cars or water heaters and avoid building dozens of new power plants. It would create room for the creation of incentives to allow existing coal plants to deal with carbon. If we want to deal with climate change in this generation, we have to deal realistically with the coal plants we have today which are producing one-half of the electricity we use in this country or 12.5 percent of all the electricity that is used in the world. To lower the cost of gasoline and natural gas or to stabilize it, we want to create new supply in two ways: By, in appropriate instances, allowing offshore drilling. We would suggest, not in this legislation but as the committee works on it, that it be offshore 30 or 50 miles and that the royalties go to conservation purposes or to the States. The final idea was to use our oil in shale. In conclusion, there is one glaring omission in this set of five recommendations that we have made, and we need to work on it. The Senator from New Mexico is the leading Senator on this subject, but we don't have anything in our amendment about nuclear energy. I believe it is important to repeat, every time we talk about electricity, if we want to talk about realism, the United States, in the next 10 years, having control of mercury, having control of sulfur and nitrogen so it doesn't create health problems, and dealing with climate change in this generation, that after conservation, nuclear power is the only real technology we have today for that purpose. We do want to recapture carbon from coal, but we cannot do that in a wholesale way yet. We will never be able to put up enough wind turbines to make much of a difference. Someday maybe solar thermal powerplants may make a difference. But if we are talking about the next 10 or 12 years, nuclear power will make the difference. Here is why I am saying that. As shown on this chart, this is the clean electricity generated in the United States of America last year. Sixty-six percent of the clean electricity -- meaning electricity with no sulfur, no nitrogen, no mercury, and no carbon -- came from nuclear power, a technology we invented in the United States in the 1950s, that our Navy has used without one single incident in submarines since the 1950s; nuclear power that has now been adopted by France: 80 percent of their electricity is nuclear power; nuclear power that has been adopted by Japan: They build a new nuclear plant every year or so. We appropriated $5 billion to lend to Westinghouse in this body to help China build nuclear powerplants. When are we going to get serious about cleaning up the air? So we have ideas about that -- not in this proposal. One would be to reprocess the waste, reduce it by 95 percent, so we can store it more safely. That is one idea. Another idea would be giving increased credits for the production of nuclear power. If we were to subsidize nuclear power by the kilowatt hour in a way proportional to how we subsidize wind, we would be subsidizing nuclear power with about $340 billion a year. So the Republican proposal to help balance the family budget on lower energy costs has five general areas as part of a reserve fund the appropriate committees can make a difference with. They have to do with conservation, and they have to do with increasing this supply. But what it means is, these are realistic ways to deal with the $3.50-a-gallon gas price and realistic ways to make sure we have large amounts of clean electricity, so we can deal with clean air as well as climate change in the near term instead of some later time. This is a real proposal and not a fairytale. This is for the country that produces 25 percent of all the energy in the world and not for some desert island. This will help balance the family budget. We hope it earns strong Democratic support as well as Republican support. Mr. President, I yield the floor.