VI. SocietalImpacts

SocietalImpacts

SocietalImpactsOverviewand Findings

In addition to influencing energy supplyand demand, the National Energy Plan willaffect, directly or indirectly, immediately oreventually, most aspects of l ife in theUnited States. Although some of the in-dividual impacts are clear, the net effect ofthe Plan on particular regions or incomegroups or sectors of the economy cannot bepredicted with certainty. Moreover, all theelements of the impact equation are notpresent: some measures for mitigating ad-verse impacts are not discussed in the Plan,e.g., in the case of regional impacts. As inany major policy shift, risk and uncertaintyexist and this must be recognized, althoughalternative policies to deal with these riskscould be formulated.

The indicated effects of the Plan on theoverall economy and employment arelikely to be minor but adverse, but thesecosts appear small compared to the cost ofincreasing reliance on foreign energysources.— The basic energy choice to bemade is between a series of immediate ac-tions that may result in an economicslowdown which the Nation can endure,and a failure to act at all, which would leadto a major economic disruption in thefuture.

Even though the effects of the Plan on theoverall economy are likely to be small, cer-tain regions, sectors of the economy, and in-come groups could be more seriouslyaffected, either by the provisions of the Planitself, or by the failure of the Plan to redressadverse impacts resulting from the general

energy situation as has developed since1973. The Plan may not fully cushion lower-income persons from the effects of risingenergy prices, although the general effecto n i n c o m e d i s t r i b u t i o n s h o u I d b eprogressive. Although no plan should be ex-pected to foresee and offset all inequities,the National Energy Plan could usefully in-clude a program to monitor its equityeffects and those of the general energysituation, and a mechanism for proposingprograms to redress inequities.

A number of participants in the analysisfelt that a discussion of energy-relatedmarket structure, in particular horizontaldivestiture, would be useful. However,OTA, in review, concluded that it did nothave the materials in hand to do an analysisin enough detail to be a useful contributionto the debate in Congress.

it is unlikely that the strong measuresnecessary to meet the environmental goalsof the Plan are compatible with a substan-tial increase in the use of coal on theschedule proposed in the Plan.— Adeliberate choice between increased use ofcoal and air-quality goals will probablyhave to be made in the short run, at least insome regions. Moreover, emphasis on im-mediate, accelerated use of coal mayforeclose some more acceptable, longer-range coal uses and other energy tech-nologies. Even if air quality could be pro-tected during the coal-conversion program,there are a number of other adverse en-vironmental and social impacts of increasedcoal production and use that are not ad-dressed in the Plan. These range from waterpollution, to mining safety, to transporta-tion impacts.

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The Plan does not provide enoughemphasis on health research.— Health im-pacts are especially uncertain for coal andother fossil-fuel technologies becausehealth research in these areas has been morelimited than the research on the effects ofionizing radiation. Questions of thresholdsand synergisms are of especial importanceto a thorough understanding of healtheffects from all energy technologies. Possi-ble long-term health effects from coalgasification and liquefaction are of particu-lar concern. There is an urgent need for acomprehensive and comparative assess-ment of the health effects of energy supplysystems and for an environmental monitor-ing system to provide an early warning ofunanticipated environmental problems.Research also is needed on the possible ad-verse effects of tight insulation on the in-door environment, and on outdoor emis-sions from diesel automobile engines.

For a variety of reasons, the role ofnuclear electricity generation is subject tocontroversy.— There is no public consen-sus on the questions of safety, standardiza-tion, waste disposal, the environmentaleffects of normal operating conditions, andthe probability of sabotage. It may beespecialIy important to undertake asystematic comparison of nuclear powerwith other energy alternatives, with fullpublic participation, so that a broader con-sensus about the relative desirability ofnuclear power can be developed.

More encouragement should be givento less polluting technologies, especiallysolar energy systems.— The solar tax creditis limited to solar cooling and heating inprincipal residences, and fails to encouragea wide variety of applications solar couldhave now or in the near future. The en-couragement a tax credit would give to

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solar photovoltaic devices, for example,might have a very small immediate effect onenergy use, but it could serve to acceleratethe eventual economic competitiveness of awider range of solar photovoltaic applica-tions.

ThementsEnergyseriousof how

roles of State and local govern-in implementing the NationalPlan are not clear.— There is a

question, not addressed in the Plan,to identify and respond to regional

differences in economies, environment,resources, and social conditions. Nationalenergy policy will have to not only takesuch differences into account, but reconcilethem through continuous interaction withand participation by the governmentsaffected.

By emphasizing the leadership role of theFederal Government to the neglect of Stateand local ro les, the Plan appears todowngrade the importance of these levelsof government in energy decision making. Itis not clear from the proposal what informa-tion from the Plan’s proposed three-partenergy information program would beavailable to the States, although their needfor accurate, up-to-date information is asgreat as that of the Federal Government.

The chances for success of a nationalenergy policy will be enhanced by adeliberate effort to involve large numbersof citizens in the technicalities of shapingthat policy.— participation in shapingenergy policy by the large numbers oforganized and unorganized parties with avital interest in that policy requires involve-ment from the earliest planning stages

through every phase of the process. To beeffective, such participants should be wellinformed. Since much energy information ishighly technical, citizens’ groups will needaccess to expertise which, in turn, requiressustained financial support. The Plan alsoshould include a program to provide finan-cial and technical support to help linkcitizens’ groups to energy policy develop-ment.

Implementation of the National EnergyPlan will have serious and inequitable im-pacts on some regions of the country, butthe Plan contains no provisions for givingregions that will be particularly hard hiteither time or money to adjust.— Someregions of the United States will be able toadjust to the Plan’s goals for conservinggasoline more easily than others. Someareas have particularly great energy needsfor heating and cooling. It is not possible,given existing technologies, to burn coal insome regions without risking severe healthproblems. Some rural areas, particularly inthe West, are likely to experience severecommunity impacts as a result of acceler-ated fossil-fuel development. There are alsoregional differences in the potential for con-servation in the industrial sector. Many ofthese differential impacts would occur withor without the Plan. All of them are in-creased by the PIan, which aside from astatement that recognizes regional diversitytakes no general account of it.

The acceleration of domestic energydevelopment mandated by the Plan willdepend significantly on increased produc-tion from resources on Federal lands.— Ifthe Plan’s production goals are to be met,problems and controversies associated withmanaging the development of federally

owned energy resources will have to be ad-dressed more directly, particularly thoseproblems relating to the role of States indetermining which resources are to bedeveloped, which laws and regulations areto be applied, and whether accelerateddevelopment can occur without com-promising important economic, environ-mental, and social values.

The Plan does not adequately link itsshort-term proposals to a long-rangeenergy picture and examine the conse-quences of its strategies and tactics fromthe perspective of post-1985 energydevelopment.— The Plan proposes funda-mental changes during a relatively shortperiod of time in the patterns of energy sup-ply and demand. It does not address thequestion of whether those changes will pro-vide a stronger or weaker base for planningand development after 1985. For example,the Plan assumes business-as-usual produc-tion of automobiles and trucks betweennow and 1985, but does not relate thatassumption to the fact that domestic sup-plies of oil will almost certainly continue todecline after 1985. This raises the questionof whether more emphasis should be placedon developing new sources of fluid energyimmediately in the hope that supplies willbe available in the future to power the stockof motor vehicles.

The Plan also does not propose specificprograms that could make a start towardachieving new land-use patterns that are in-herently more energy efficient than existingpatterns. Nor does the Plan recognize that

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continued population growth, including im-migration, could jeopardize the goals of anyenergy plan. Finally, the Plan does not ex-amine the basic philosophical questions ofcontinued economic growth and what en-vironmental amenities are to be absolutelyprotected, no matter how severe the energysituation may become.

Issue 1

MacroeconomicImpacts

What are the likely effects of the Na-tional Energy Plan on the growth rateof real GNP, the rate of unemploy-ment, and the rate of inflation?

Summary

The indicated effects of the Plan on theeconomy and employment are likely to bem i nor but adverse. Moreover, themacroeconomic costs of the Plan appearsmall in comparison to costs of increasingreliance on foreign energy sources.

Prices of energy products as well as otherproducts which use energy in their manufac-ture or distribution will rise as a result of thePlan. It should be noted that present lawwould increase domestic oil prices to theworld market level in 1979 in any case,because cu r rent p r ice cont ro l s a rescheduled to expire at that time. Theseprice increases will add to existing inflation-ary pressure and may reduce consumerpurchasing power (aggregate demand),thereby slowing economic growth and in-creasing unemployment. The extent of sucheffects, however, will depend on the effec-tiveness of proposed rebates of energy taxrevenues in offsetting reduced purchasingpower and the ability of the economy torespond to changes in relative prices asenergy costs rise. The latter issue relates tothe ability of the economy to institute morelabor-intensive processes as the relative

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prices of energy, capital, and labor divergefrom their historic relationship, and to thedegree to which public policy can bedesigned to encourage labor-intensive proc-esses.

The near-term (1 977-79) macroeconomiceffects of the Plan appear to be relativelysmall. However, the mid-term (1 980-85)effects will probably be larger and of greaterconcern. The Plan does not address thechanging influence on the economy it willhave over time, nor does it recognize orplan for the use of monetary and fiscal toolsin addition to rebates to reduce the adverseeffects of increased prices and taxes.

Forecasts of future macroeconomic im-pacts are far from reliable. Economicforecasting models are an important sourceof information for policy makers. Because ofthe fundamental limitations of models assimplified representations of the world,even the best model cannot ensure that thefuture will match its projection. Efforts toascertain and bound the risks that are im-plicit in forecasts of macroeconomic im-pacts would appear productive, as wouldthe design of alternative policies to dealwith such risk.

Questions

1.

2.

What is the estimated cost to the con-sumer of higher prices and taxes foreach year of the Plan, compared withthose that would result without thePlan? How are these costs dividedamong the several tax and price pro-posals?

Are there measures that can mitigatethe inflationaryposed price and

impact of the pro-tax increases?

3.

4.

5,

To what extent will the various pro-posed rebates offset the loss in con-sumer purchasing power caused byhigher prices, taxes, and inflation?

How will the income redistributionfeatures of the tax-rebate system affectconsumption, savings, and wage de-mands ?

What impacts will a net loss of realconsumer purchasing power have onthe rates of economic growth andunemployment ?

Background

For the past two decades, the consump-tion of energy and the production of realGNP have grown together, both at some-what over 3 percent per year. The energyplan proposes the growth of energy con-sumption be reduced to an average of 2 per-cent per year by 1985, This proposal raisesthe possibility that GNP growth will beslowed correspondingly and that the rate ofunemployment will increase during theperiod covered by the Plan.

Virtually all forecasts agree that the effectof the Plan on GNP growth and employmentopportunities will probably be quite moder-ate. Industrial use of energy, the source ofmost of the GNP output and job oppor-tunities, is expected to grow at a slightlyhigher rate than heretofore, with energy sav-ings coming largely from reductions intransportation and residential-commercialenergy use. As a result, a GNP that mightamount to $2 tri l l ion in 1985 (in 1972prices) would be reduced as a consequenceof the Plan by perhaps $1s billion, or lessthan 1 percent. Clearly, such estimatesmake no pretense of precision; they merelyindicate the general degree of impact. In

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this instance, the estimated effect can be in-terpreted as almost negligible from thestandpoint of the overall economy, but it ismore likely to be adverse than favorable.

The likely impact on overall unemploy-ment also is very small. A fairly reliablehistorical relationship is that a l-percentdecline in real output corresponds to a 0.3-percent increase in the unemployment rate.The anticipated reduction in 1985 outputthe re fo re t rans la tes in to an overa l lunemployment rate that is higher by 0.2 to0.3 percentage points. Again, this is a verytentative estimate, but indicative of thesmall macroeconomic impact of the Plan.Public policy initiatives which would en-courage a transition from energy-intensiveto labor-intensive processes would assist inmitigating any impacts on employment.

An important feature of the Plan is to in-duce energy conservation and a shift tomore abundant fuels by encouraging theprices of oil and natural gas to rise. Thedirect impact of these price increases aremore likely to be felt by industry than bythe consumer because petroleum productsare already being priced on a marginal costbasis. New taxes will be imposed on oil andnatural gas used by industries in 1979 andutilities in 1983 to encourage the use of coaland the adoption of energy-conservingtechnologies. These taxes are likely to bepassed on to the consumer indirectlythrough the prices of purchased goods. Thecrude oi l equal izat ion tax would bereflected in higher gasoline prices. The onlydirect increase in consumer prices forenergy products would result from a pro-posed standby gasoline tax.

increases in wages, with further inflationaryconsequences. This is a slow process, andthe magnitudes of the effects are hard toforesee. Econometric estimates suggest thatduring the first 5 years of the Plan thecumulative inflationary impetus will be ofthe order of 2 percent (i.e., 0.4 percent peryear).

Although the inflationary impact dis-cussed above is not negligible and could beregarded as a necessary cost of reducing de-pendence on imported oil, its full impactmay be avoidable. Coordinated monetaryand fiscal policy could be used to moderatethe Plan’s adverse effects on inflation, justas the Plan’s rebate system is aimed atreducing the impacts on real purchasingpower and the associated growth-employ-ment impacts.

As indicated, however, increases in theprice of energy to the industrial sector willlead to greater or lesser increases in theprices of all commodities, and indirectly to

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Issue 2

DistributionalImpacts

The National Energy Plan will im-pinge on many explicit and implicitsocial goals. The economic impactwill vary by income class, region, andsector, posing equity questions thatmay require mitigating policies.

Summary

It appears that the Plan will affect variousgroups in American society in differentways, Some groups could be economicallyadvantaged by the Plan while others willmost certainly be harmed. If the Plan is to besuccessful, all Americans will need tochange consumption patterns with respectto energy and possibly, to some extent,Iifestyles. Income classes, regions andeconomic sectors all will feel these impacts,often in conflicting and inconsistent ways.

The question is whether any one group isdisadvantaged so adversely as to requireFederal assistance. The Plan deals with thisproblem on only one level—that of incomeequity. Socially and politically, other dis-tributional classifications will also be impor-tant. Moreover, it is even unclear whetherthe measures designed to mitigate the Plan’simpact on the poor will be adequate.

Since distributional impacts of substantialpolicy changes are often widespread,diffuse, and uneven, there is probably noway to foresee the total ramifications, muchless design mechanisms at the start to offsetall inequities. What the Plan could include,however, and what is lacking, is a program

to monitor its own equity impacts and thoseof the general energy situation plus amechanism for effect ively proposingprograms of redress.

Questions

1.

2.

3

4.

5.

The Plan attempts to minimize adverseimpacts on lower-income persons.How likely are these attempts to suc-ceed ?

What mechanisms should be designedto identify important adverse distribu-tional impacts which might result fromPlan implementation?

Can industries and regions be iden-tified which will be directly affectedby the Plan in a substantial way—either advantageously or disadvan-tageousl y?

Have potential secondary equity im-pacts of the Plan been identified?

Can differential equity impacts withand without the Plan or with alterna-tive policies be ascertained?

Background

U.S. equity goals have never been statedas clearly as many other goals but generalagreement might be reached on the follow-ing principles: (1) No industry, area, or in-dividual, should be importantly affected bya public policy unless these impacts havebeen weighed carefully; and (2) The adverseimpacts o f po l icy shou ld be borneprogressively, i.e., the greater impact shouldbe borne more than proportionately bythose better able to bear it.

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SocietalImpacts

There is no nat ional consensus onwhether the mitigation of inequitable situa-tions should occur as an organic part of theprograms or policies that create them or beleft to the operation of more generalameliorative measures. In the present in-stance, the former choice has been madesince the Plan contains mitigating orameliorative measures along with its directenergy proposals. As a result, it can beevaluated as an equity-preserving orenhancing plan.

There is, however, a complication. Theenergy situation of the United States will becreating its own impacts on social goals.The Plan can therefore be evaluated in twoways, First, it can be judged to see if its pro-visions minimize its own adverse impacts onequity goals. Secondly, it can be judged tosee if its provisions effectively offset the ad-verse impacts on equity goals stemmingfrom the Nation’s overall energy situation asit would exist without the Plan, Both stand-ards of judgment are relevant.

Industrial Sector Effects—it is reasona-ble to expect that uneven effects of theoverall energy situation will be felt in indus-try, with the largest effects on those whosedirect energy consumption is greatest. Thetwo largest energy-consuming industries arechemicals and allied products, and primarymetals. Another obvious target for large im-pacts is the automobile industry.

Areas and individuals dependent onthese industries are likely to bear a relativelyheavier burden of adjustment to the generalenergy situation as the industry productprices rise at an above-average rate, as de-mand for their product changes, and as theyalter their techniques and rates of produc-tion to adjust to changes in input prices andoutput demands. These impacts of the over-

all energy situation are likely to be exacer-bated by the Plan, which makes no pro-posals to mitigate these general effects orthe extra adversity the plan may impose.

Moreover, the Plan creates price differen-tials which are likely to create additionaldifferential impacts. If all tax and rebate pro-posals are implemented, oil will cost con-sumers quite different prices for differentuses. By 1988, a barrel of oil at today’sprices will cost a utility $14, an industrialuser and commercial aviation $17, and auser of gasoline $36.68. The Plan containsno explicit recognition of these newly cre-ated differentials nor of the effects they mayhave on different industrial sectors.

The Plan clearly contains no estimation ofthe relative ability of industries to bear thedifferentials created either by the generalenergy situation or by the Plan. It seemsunlikely, therefore, that impacts will beequitably borne. No mitigating proposalsare made.

Regions—Since regions are not uniformwith respect to industrial mix (see above) orrelative income distribution, differential im-pacts on areas are to be expected fromthese two sources. There are other reasonsfor expecting differential area impacts aswell. Some areas are more rural and will bemost affected by the particular emphasis thePlan places on curbing gasoline consump-tion. Some areas have extraordinary energyneeds for heating and cooling because ofclimate extremes. Some areas are likely toexperience greater environmental impactfrom fuel production and conversion thanothers. Community facilities and services insome areas will be strained by expandedenergy production projects.

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The most prominent example is coal min-ing. The Plan calls for a 100-percent increasein U.S. coal production by 1985—more than600 million tons per year of new produc-tion, and possibly as much as 700 milliontons when replacement of depleted mines isconsidered. The primary areas for increasedproduction will be Appalachian States andStates in the northern Great Plains and theSouthwest. Areas where production takesplace wil l experience an expansion inregional employment, total income, and de-mand for community services and housing.(See Issue #14.)

Additional examples include families inrural areas that spend more of their incomefor gasoline than urban families, andfamilies in the South and West that spendmore on this energy product than those inthe North and East. Similarly, an increase inthe cost of home heating and cooling willmore strongly affect areas with more ex-treme winter or summer climates, depend-ing on the regional mix of fuel oil, naturalgas, and electricity as sources of energy forhome space conditioning. There are alsoregional differences in the potential for con-servation. Because South-Central States usemore fuel per manufacturing employee thanWestern or New England States, they maybe more heavily affected by the Plan.

Many of these differential impacts wouldoccur without the Plan. All of them are in-creased by the Plan, which in general takesno account of them.

Individuals—The Plan was drawn upwith particular awareness of differentialeffects on individuals in different incomeclasses and consequently cannot be faultedfor overlooking these impacts. Though thereare differences of opinion (to be discussedbelow), some commentators (the Congres-sional Budget Office, for example) conclude

that the overall effect of the Plan’s taxes andrebates would be modestly progressive. (Itshould be noted that this conclusion wasbased upon the Plan as a whole. Modifica-tions to the Plan could change that conclu-sion.) That analysis, however, relates only tochanges that would result from implement-ing the Plan and does not cover differentialeffects by income class of the overall energysituation.

The data confirm what would be ex-pected—the share of income devoted toenergy-related expenditures falls sharply asincome rises. One estimate is that thelowest-income quartile spends more than30 percent of its income directly or in-directly on energy, while the highest quar-tile spends about 10 percent. The Plan doesnot address this issue in a substantive way.It promises “a reformed welfare system”and a “redesigned emergency assistanceprogram” to help (p. 90), but these pro-posals may not go far enough to protectlow-income families, Even the Plan’s pro-posed per capita rebate of wellhead taxeswill not necessarily assure equity becausenot all of the tax will be rebated to in-dividuals (some will go to offset revenuelosses from investment tax credits) and thetax will not be rebated progressively (Sec.1403). The proposed welfare and emergen-

cy assistance programs may aid the poorestgroups but those just above that level arelikely to have the largest burden imposedupon them by the overall energy situation.

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SocietalImpacts

If there should be an added increment toinflation, as seems likely, or if the Planshould prove to adversely affect economicgrowth, lower-income groups will bear thebrunt of this. The young may be affected bya further slackening in job opportunities,coupled with added inflation. The situationof the young, as affected by the Plan, is notaddressed.

The poor, and particularly the rural poorwho probably comprise most of the half ofthe lower-income group who own cars, willbe hit most heavily by the increases ingasoline prices the Plan proposes. Not onlydo they spend a relatively larger proportionof their income on gasoline, they suffer fromtwo other handicaps that would make itdifficult to adjust to higher transportationcosts. First, mass transit is not available forall essential travel, such as to work. Sec-ondly, the poor generally cannot affordnew, gas-economizing cars. They will be thepurchasers in the second-hand market of“gas guzzlers” whose relative prices will fallas gas prices rise, bringing them withinreach of lower-income groups. Thus, thosewho can afford new, fuel-efficient cars willbe saving money on gasoline while the poorwill be spending more on gasoline. No ele-ment in the Plan recognizes or offsets thesepossible inequities.

A comparable lack of capital wi l lpreclude lower-income homeowners fromtaking advantage of the tax-credit programsfor residential insulation or solar energyunits. They may not be able to meet “frontend” costs and they may not be payingenough taxes to get the full tax credits pro-posed by the Plan.

One group of Americans who will not beable to benefit from residential energy con-servation programs are tenants who pay fortheir fuel but who cannot be reimbursed forinsulation expenses. Tenants who do notpay for the added cost of heating oil directlywill do so indirectly through higher rents,but they are not likely to benefit from re-bates on home-heating oil. The Plan’s pro-posed increase in the federally financedweatherization program will help in shelter-ing the poor against higher fuel costs.However, the current program does not ex-tend such help to renters. In addition, thelevel of funds available for insulation assist-ance may be too small. At present, there areapproximately 9 million substandard homesin the United States, homes which for themost part are inhabited by the poor. Theweatherization programs will handle only asmall fraction of these structures.

Probably no plan could foresee and offsetall inequities. What the Plan could include,however, and what is lacking, is a programto monitor its equity effects and those ofthe general energy situation and a mecha-nism for effectively proposing programs toredress inequities.

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lssue 3

Air QualityImpacts ofIncreasedCombustionof Coal

Strict enforcement of strong environ-mental regulations will be necessaryto protect air quality while coal pro-duction and use increase under theNational Energy Plan; such environ-mental policies may, in turn, slow thepace of growth in coal utilization.

Summary

A major shift from petroleum fuels to coalis a central element of the National EnergyPlan. Under the Plan, coal would provide 29percent of U.S. energy requirements in1985, compared with 18 percent in 1976,reducing demand for oil by the equivalentof 2.4 million barrels a day. As the Plan’scoal proposals are implemented, strict en-vironmental protection policies will be re-quired to avoid adverse impacts on airquality. The Plan requires installation of bestavailable pollution control technology onall new coal-burning facil it ies. Pendingamendments to the Clean Air Act alsowould cancel credits for tall stacks, requirecontrol equipment to be installed on allfacilities that do not meet emission stand-ards, and set penalties for noncompliancewith standards and failure to maintain con-trol equipment in good working order. It isnot likely that such strong environmentalmeasures are compatible with a substantial

increase in the use of coal on the scheduleproposed in the Plan. A deliberate choicebetween increased use of coal and airquality goals may have to be made at somepoint in the future.

Questions

1. Under what, if any, circumstanceswould a coal-burning facility be issueda variance from Clean Air Act emissionstandards ?

2. Under what condit ions would apowerplant or industrial facility beallowed to continue to use oil ornatural gas rather than coal ?

3. If all new coal-burning facilities are re-quired to install flue-gas desulfurizers(FGD), currently considered the bestavailable technology, would develop-ment of other technologies such asfluidized-bed combustors be delayed?

4. What level of funding is contemplatedin fiscal year 1978 for developing moreeffective control and combustion tech-nologies ?

5. To meet the goals of the NationalEnergy Plan, how many new FGDs orscrubbers must be manufactured andinstalled between now and 1985 ? Cansupp l ie r s meet that p roduct ionschedule?

6. Will efforts to make coal combustionenvironmentally acceptable delaydevelopment of alternative tech-nologies such as solar which are en-vironmentally cleaner?

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Background

The National Energy Plan states thatenergy goals are to be achieved “withoutendangering the public health or degradingthe environment” and “without sacrifice ofair quality standards . . .“ A Presidentialreview panel would evaluate the healtheffects of expanded coal use (pp. 67-68).These are commendable goals, but it ispossible that they cannot be achieved with-out sacrificing the Plan’s goals for coalutiIization.

For coal combustion, the Plan proposesthat the best available control technology(BACT) be required on all new coal-burningfacilities. If the Plan’s proposals and thestrongest features of pending amendmentsto the Clean Air Act are implemented onschedule and without exceptions, the sulfurdioxide, particulate, and nitrogen oxidelevels in the air will ‘not change significantlyas a result of the Plan, assuming the conser-vation goals of the Plan are also met.

However, combustion of coal releasesmore carbon dioxide into the atmospherethan either oil or natural gas and there areother inherent conflicts between the Na-tion’s air quality goals and the Plan’s coalutilization goals. For example:

1. In certain regions of the United Statesthat do not yet meet ambient airquality standards, no new coal com-bustion can occur unless pollutionfrom other sources is reduced at afaster rate than is now scheduled. Thiscannot be accomplished either easilyor immediately.

2. Compliance with Federal air qualityregulations depends on State imple-mentation plans and State monitoringand enforcement mechanisms, whichwould delay the effect of new Federalprograms. Some States have adoptedmore stringent standards than theFederal Government, in some casesrestricting or forbidding coal utilizationeven where Federal regulations wouldallow it.

3. Rapid implementation of air pollutionabatement policies using stack-gascleaning is opposed by most publicutilities on the grounds that it is notreliable, that scrubbers that use lime orlimestone produce unacceptableamounts of sludge, and that betterpollution control technology will beavailable by the 1980’s.

4. It may not be possible to manufacturescrubbers or other pollution controlequipment fast enough to meet the1985 goals of the Plan. Delays of com-pliance may result.

5. The Plan’s emphasis on rapid conver-sion to coal, coupled with its require-ment that the best available controltechnology be installed, may divertcapital from research and commer-cialization of alternative technologies,such as solar energy units, and conser-vation technologies.

6. Delays in expanding coal production atthe pace proposed by the Plan may benecessary or desirable because of en-vironmental, social, and institutionalproblems associated with increasedcoal production. (See Issue #1 4.)

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7. Uncertainties exist as to which pollut-ants need to be regulated and whatlevels are tolerable. To the extent thatthese uncertainties reflect inadequatecorrelations between environmentalcauses and health effects, the uncer-tainties eventually can be solved byexpanded hea l th re search andmonitoring. (See Issue #5.)

For these reasons, it is likely that Federaland State regulatory agencies will be askedto issue variances from air quality standardsfor new powerplants and industrial facilitiesand for existing industries to enable a shiftfrom oil or gas to coal. Arguments forvariances may be compelling: Some coal-burning facilities could not be operatedwithout violating air standards. Better con-trol technology may be available within afew years. A firm’s economic analysis mayindicate that it makes more sense to shutdown operations than to convert to coaland comply with air quality regulations. Pastexperience indicates that some regions willprefer deter iorat ion of envi ronmentalquality to losing a major employer. If deci-sions in such cases are to stress conversionto coal, granting of variances that delay airquality compliance schedules probably willbecome so common that air quality willdecline in some regions. To a limited extent,the pressure for variances can be eased bysiting facilities outside metropolitan areas.

One consequence of limited conversionof oil- and gas-burning facilities to coalcombustion will be continued reliance onoil as a fuel source. In that case, it would beimportant for refineries to retrofit to pro-duce low sulfur oil. An increased supply of

low sulfur oil will result in decreased sulfurdioxide pollution from oil-burning sourcesand hence permit more coal conversionswithout degrading a region’s ambient airquality.

Emphasis on immediate, acceleratedutilization of coal may foreclose some moreacceptable, longer-range coal uses. Addi-tional research is warranted on post- andpre-combustion cleaning techniques. Newcombustion techniques using nonconven-tional boilers show promise of reducingemissions, especially nitrogen oxides. Forexample, fluidized-bed combustion offershigher combustion efficiency and cleanerburning than traditional boilers. Investmentcredits or other market incentives could ad-vance these and other cleaner technologies.

Achievement of air quality standards isalso dependent on meeting NEP conserva-tion targets. However, conservation savingstend to reduce national emission levels (asin the case of more fuel-efficient autos) andthese savings will normally have far less sig-nificance in particular local situations wherecoal conversion is at issue.

Environmental Protection Agency Photo

1 5 9

SocietalImpacts

Issue 4

OtherEnvironmentalImpacts ofCoal Utilization

Even if air quality could be protected,meeting the coal production andutilization goals of the NationalEnergy Plan may result in other ad-verse environmental and social im-pacts.

Summary

Although the Plan “intends to achieve itsenergy goals without endangering thepublic health or degrading the environ-ment” (page 67), its only specific environ-mental protection proposals concern airqual i ty and st r ip mining reclamation.However, both combustion of coal and con-version of coal to synthetic gaseous andliquid fuels may result in a much widerrange of environmental and social impacts,some of which are not presently regulated.The magnitude of those effects couldjeopardize the realization of the coal utiliza-tion goals of the Plan, even if air qualitystandards were met.

Questions

1.

160

The Plan supports amendments thatwould strengthen the Clean Air Act.What policies and procedures pres-ently addressed by the Federal WaterPollution Control Act wil l protectwater from pollutants such as acid andwater runoff from coal mines, disposalof water used in precombustion wash-ing of coal, and in coal transportation?

2.

3.

What are the environmental impactsassociated with disposal of wasteproducts (e.g., sludge) from scrubbersin the quantity envisioned by the Plan?

What assumptions underlie the Plan’sconclusion “ that “it appears thatrailroads could transport the additionalcoal” (p. 65) ?

Background

The National Energy Plan, in outlining itsenvironmental policy regarding coal (pages67-68), emphasizes the protection of airquality and the need for national strip minelegislation. Mitigation of other specific en-vironmental impacts is omitted from thePlan except for impacts on public services inlocal communities (p. 89). (See Issue #14.)

The potential impacts of a major expan-sion of coal production and utilization areextensive. Impacts other than those men-tioned in the Plan include the following:

1. Environmental and social impacts ofcoal mining. In the West, potentialproblems include water consumptionfor surface reclamation, contaminationor loss of ground water aquifers,drainage of highly alkaline waters fromWestern mines, and rapid populationincreases and boomtown developmentin rural areas. In the East, potentialproblems include acid-water runofffrom mines (especially after mineabandonment, or reactivation of oldmines, and in mines above valleyfloors), and land surface subsidence.

2.

,

Safety in underground mines, Coal ex-traction and processing pose healthand safety hazards to miners, othercoal workers, and local populations.The health and safety record in coalmining has been among the worst inthe United States, with fatal and dis-abling injuries most prevalent amongnewly employed miners.

3.

4.

5.

Federal Energy Administration Photo

Currently uncontrolled air emissionsfrom coal combustion. Although sub-ject to some regulation, emissions ofnitrogen oxides are not adequatelycontrolled by best available controltechnology. Radioactive materials, hy-drocarbons, carbon monoxide, andheavy metals in gaseous, liquid, orsolid states are not regulated at all.

Climatic and weather effects. Coal,like other fossil fuels, releases carbondioxide and particulate into the airduring combustion, both of which maycontribute to global climatic changes.Conversion to coal would increase car-bon dioxide emissions because-perunit of energy delivered-coal yields11 percent more carbon dioxide thanoil and 67 percent more than naturalgas. An accelerated use of coal wouldtherefore aggravate any long-term ad-verse effects on climate that resultfrom carbon dioxide.

Waste products from pollution controldevices. The harmful emissions fromcoal combustion do not disappearwhen control technologies are in-troduced. Rather, the technologiesconvert them f rom one form toanother-gaseous to dissolved solid,for example. Consequently stack-gascleaning produces waste as sludge.Some scrubbers produce about 3,000tons of solid suspended in severalthousand tons of water per day foreach Gigawatt of power generated.Because of the large quantities ofsludge produced, disposal may causeland-use problems. The moisture con-tent of the sludge, for example, mustbe contained to avoid contaminationof ground and surface water.

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6.

7

Emissions from coal gasification andliquefaction pIants. Even if air pollut-ants from these facilities are controlledunder provisions of the Clean Air Actas amended, waste water and solidwastes could present problems. For in-stance, gasification waste water mayhave a concentration of inorganicmaterials that is as high as that in seawater, plus organic substances includ-ing cyanide, thiocyanate, ammoniasulfide, phenols, and oils. Waste-watertreatment in the Lurgi gasificationsystem requires tar-oil-water separa-tion (three stages), filtration, phenolrecovery, ammonia recovery (in an am-monia still), and activated carbontreatment. Several components in thesystem are new techniques, and anintegrated system has never beenoperated at commercial scale. Totalquantities of solid wastes will dependon the ash content of the coal,generally ranging from 2,000 to 3,300tons per day from a 250 million cubicfeet per day gasification plant; thesesolid wastes will contain most of theheavy metals from the coal.

Transportation system requirements,Although the Plan asserts that the Na-tion’s railroad network is adequate todeliver anticipated amounts of coal (p.65), the railroad industry’s capacity tohandle this increased traffic will de-pend on investment in rolling stock,and in some areas, improved track andsignal systems. Even where the presentrail network is adequate, increasedcoal transportation could result inlonger trains and more frequent trips.

8.

This, in turn, could lead to more acci-dents, railroad congestion, more fre-quent delays at automobile crossings,greater sustained noise levels, andmore dust and air pollution alongrailroad rights-of-way. These effectswill be especially noticeable in smallrural towns.

Other transportation and conversionalternatives, including slurry pipelines,minemouth power generation, andliquefaction or gasification of coalprior to transportation should be con-sidered, especially in the West.

Other long-term impacts. Some scien-tists believe that coal burning releasesnot only relatively well-known andharmful emissions, but other com-pounds whose health impacts are pres-ently unknown. These compoundsmay have long-term carcinogenic ormutagenic effects or they may con-tribute low-level radiation to the en-vironment.

The inescapable conclusion is that coal isa “dirty” energy source. The sulfur, ash,heavy metals, radioactive substances, andcarbon usually found in coal are all present,in altered states, after combustion. Addi-tionally, coal must be extracted andtransported, which requires extensive use ofland, people, and equipment and creates arange of environmental and health hazards.Managing these processes so as to avoid theadverse effects is a challenge which the Na-tional Energy Plan does not fully address.

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lssue 5

HealthImpacts

The long-term health effects of theenergy priorities established by theNational Energy Plan are uncertain.

Summary

Even where standards have been definedfor emission levels and environmentalquality, the following energy-related ad-ministrative or information gaps exist: (a)scientific evidence to document the healthimpact of different levels of pollutants; (b)an effective system to monitor pollutantlevels and maintain health impact statistics;and (c) a consistently applied approach tocorrelating pollution levels and humanhealth. The uncertainties are especiallygreat for coal and other fossil fuels, becausehealth impact research has been sparsecompared to research on ionizing radiation.Consequently, there is an urgent need for amore comprehensive and comparativeassessment of health effects of energy sup-ply systems and for an environmentalmonitoring system to provide an early warn-ing of unanticipated environmentalproblems.

Questions

1. Have the human health impacts of theNational Energy Plan been estimated(e.g., morbidities and mortalities in1985 with and without the Plan) ?

2.

3.

4.

5.

IS the threshold concept of pollutionregulation compatible with the protec-tion of human health? Do presentpollution regulations include the syn-ergistic effect of some pollutants? Howfrequent ly should envi ronmentalstandards be reevaluated?

As a result of the energy plan, how willthe level of radiation in the environ-ment (nationally and regionally) beaffected by (a) coal utilization, (b)nuclear power generation, and (c)geothermal energy development? Areradiation effects of coal and geother-mal facilities monitored?

How will human health be protectedfrom carcinogenic substances in theprocess stream of coal gasification orliquefaction facilities?

What is the present status of researchon the Iong-term genetic effects ofcompounds produced by the conver-sion of coal to a liquid or gas?

Background

Although environmental protection andhuman health and safety are prominent con-cerns of the National Energy Plan, too littleis known about the health effects of theenergy technologies, processes, andresources included in the Plan to be certainof their impact on human health.

Health effects are relatively well under-stood in at least two areas: (a) physiologicalimpacts of relatively high radiation levelsand certain radioactive isotopes, and (b)physiological impacts of relatively highlevels of other possible energy byproducts(such as heavy metals, cyanide, and someair pollutants) which have been identifiedby searching for the major causes of specific

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human deaths and illnesses. But even inthose well-studied areas, there is disagree-ment on the level below which there is nohazard to human health-or even whethersuch a threshold exists.

The energy plan embraces present en-vironmental legislation which regulatessulfur dioxide, particulate, and nitrogen ox-ide emissions from fossil fuel combustion,but the Plan fails to address other possibleenvironmental contaminants, some ofwhich may pose greater long-term threats tohuman health. Current regulations fail toprovide for synergistic or long-term healtheffects. Regulation or precursors, such assulfur dioxide, may be insufficient whenreaction products, such as sulfuric acid,cause the significant health effects. The Plansupports present protections against con-taminat ion f rom h igh ly rad ioact i vematerials, but it does not consider thepossibility that a general rise in low-levelradiation may be a health hazard. Otherkinds of possible effects that are overlookedinclude long-term global climate modifica-tion as a result of carbon dioxide build-upand long-term genertic damage from chemi-cal byproducts of coal gasi f icat ionor liquefaction.

In addition to the general lack of informa-tion on environmental health, it is still un-certain whether current environmental pro-tection standards are appropriate. Monitor-ing of air quality and correlation of airquality changes and human health effectsare needed. Interagency and interofficecoordination of research on pollutants,overall air quality, and human healthstatistics would help ensure that emissionstandards are neither too lenient, allowingtoo many adverse impacts on health, nortoo strict.

Scientif ic and environmental healthresearch is necessary in areas beyond “bestavailable control technologies, ” includingthose health effects and pollutants whichhave not yet been identified. A process forreviewing and assessing the adequacy of na-tional systems for protecting human healthmay help accumulate environmental healthdata. The mechanism and process need tohave at least three elements:

1. A continuing assessment of the healthimpacts of energy supply technologies,including (a) an accelerated assess-ment of the long-term impacts of solidfossil fuels (coal and oil shale); (b)special attention to the human healthsignificance of any chemical com-pounds and radioactive materials thatare produced by energy supply proc-esses; (c) identification and analysis ofkey morbidity and mortality indicatorsin the U.S. population, as they relate topollution levels; and (d) an increasedemphasis on environmental health inthe training of personnel in healthprofessions, together with special sup-port for training in understaffed fieldssuch as environmental toxicology.

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2. Improvements in monitoring the quan-tities and characteristics of byproductsof energy supply facil it ies, with aspecial emphasis on improving the in-s t r u m e n t a t i o n f o r i d e n t i f y i n gbyproducts of facilities burning or con-verting coal (a recent joint study by theNational Academy of Sciences and theNuclear Regulatory Commission foundthe Environmental Protection Agency’scurrent monitoring programs seriouslydeficient).

3. A review of the requirements formeasuring byproducts of energy sup-ply facilities other than light-waterreactors, to see if additional monitor-ing requirements are needed.

Issue 6

Impacts ofNuclearPower

The National Energy Plan’s proposalto increase nuclear electricity genera-tion raises environmental and socialquestions.

Summary

Although the Nat ional Energy Planemphasizes the increased use of coal togenerate electricity in the United States, italso calls for light-water nuclear reactors toplay a major role in reducing the Nation’sdomestic energy deficit. “By 1985 . . .nuclear power could provide as much as 20percent of electricity supply” (p. 71), twiceits current share. “There is no practicablealternative” (p. 70). But questions remainabout the safety of nuclear reactors, the im-pacts of fuel cycle activities necessary tomeet the needs of expanded nuclear powergeneration, the potential for sabotage, andthe social desirabil ity of concentratingelectricity generation in the kinds of largecentral-station plants implied by nuclearenergy options.

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Questions

1. In what ways might the protection ofnuclear reactors from sabotage abridgethe civil liberties of the American peo-ple?

2. What is the potential for nuclearpower generation on a small scale(e.g., the “nonproliferating reactor”design concept recently investigatedby the Energy Research and Develop-ment Administration) ?

3. Are there plans to undertake asystematic comparison of nuclearpower generation with other supplyalternates? To what extent and howclosely would representatives of thepublic participate in this comparativeassessment ?

Background (See also Supply Issues#9, #10 and #11 )

According to the National Energy Plan, asmany as 75 additional light-water nuclearreactors could be in operation by 1985,joining the 63 presently operating plants (p.71). The Plan calls for increased attention toreactor safety, waste management,proliferation, and other impact issues; butdisagreement continues to exist aboutwhether the risk of serious environmentaland social impacts is acceptable.

In addit ion to concerns about thereliability of light-water reactors, the impactissues include:

1. The safety of nuclear reactors. The Plannotes that “the safety record of light-water reactors has been good, ” butmany people and groups in the UnitedStates believe that even a small risk ofa serious accident is unacceptable,especially as the number of operatingreactors increases. Although con-siderable attention has been given tothe prevention of major accidents suchas a core melt-down, much less isknown about design alternatives thatimprove containment of radioactivematerials in case of an accident.Evacuation plans for population in thevicinity of nuclear plants may be in-adequate. If a major accident were tooccur despite the low probability, notonly could the immediate conse-quences be devastating, but the publicoutcry could force the shutdown of allother reactors. If a major commitmentto nuclear power had been made, thedisruption to the energy economywould be severe,

166

2. Other impacts of fuel cycle activities.A doubling of the number of nuclearplants will require additional mining,milling, enrichment, and transportationof nuclear fuel; and it adds to theeconomic and* energy-efficiency argu-ments for fuel reprocessing and recyc-ling, especially if uranium resourcesturn out to be no higher than the morepessimistic assumptions. Each of thesekinds of activities has environmental,economic, and social impacts; for ex-ample, mining, milling, and enrichmentfacilities produce tailings that add toradiation background. In addition, thenuclear reactors themselves may affectthe local ecology by discharges fromcooling towers to receiving waters orthe atmosphere (dispersing heat,moisture, salts, other chemicals, andlow-level radioactive products).

3. The potential for sabotage. There is noagreement on how difficult it would beto sabotage a reactor so as to causeserious damage in an area near a plant.It should also be noted that seizureand occupation of a reactor with athreat of sabotage could causew i d e s p r e a d d i s r u p t i o n , e v e n i fsabotage efforts were unsuccessful orthe threat was not carr ied out.Although NRC has recently upgradedsecurity at nuclear reactors, questionsabout reactor safeguards remain.

4 Social impacts of centralized energysupply. An element in the social pro-tests against nuclear plants is the opi-nion that nuclear power furthers thecentralization of the U.S. energy supplysystem, favoring capital-intensive in-frastructure and requiring technocraticelites. There are also civil liberty con-cerns about security and safeguards re-quirements at nuclear facilities.

For these principal reasons, even a sup-plementary role for nuclear electricitygeneration is open to controversy, and theissues need to be addressed more clearlyand specifically than in the Plan. It may beespecially important in the next few years toundertake a systematic comparison ofnuclear power with coal and other energysupply alternatives. This comparison shouldinvolve extensive public participation, sothat a broader consensus about the relativedesi rabi l i ty of nuclear power can bedeveloped.

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Issue 7

AlternativeTechnology-Solar

The National Energy Plan underesti-mates the variety of contributions toenergy production, conservation andenvironmentalmade by solar

Summary

quality that can betechnology.

Solar technologies can play an in-creasingly significant role in meeting the Na-tion’s energy needs in the near future. Thesetechnologies protect the environment,create jobs, employ an inexhaust iblerenewable energy source, and provide analternative to dependence on large-scalecentral electrification. To fully realize its po-tential for meeting a variety of the Nation’senergy needs, solar technology requires in-centives beyond the measures of the Plan.

Questions

1. Why does the solar tax credit apply toonly the taxpayer’s principal residence,(National Energy Act, Sec. 1101 (a)) andnot to vacation homes, rental property,light industry, or commercial build-ings ?

2.

3.

4.

Why does the solar tax credit applyonly to equipment used to heat andcool buildings and heat water and notto other applications, which may be aseconomical and practical (e.g. photo-voltaic power generation for certainremote-sensing applications) ?

What incentives, other than fundingfor research and development, are ap-plicable to alternate energy tech-nologies such as biomass technology,wind energy, and solid waste?

Some of the most useful applicationsof solar technologies may be indeveloping countries, especially inrural and remote areas. What are theplans for international cooperation indeveloping solar systems compatiblewith the energy and social needs ofdeveloping countries?

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Federal Energy Administration Photo

Background

The National Energy Plan provides a taxcredit for installation of qualifying solarequipment, funding for installation of solarequipment in Federal buildings, and in-creased funding of various aspects of solarresearch and development (pp. 75-76).Also, the industrial tax credit for conversionfrom oil and gas may encourage use of solarenergy as well as coal. Solar technology isthe only available energy technology whichcan claim a neutral environmental impact inoperation, which becomes a positive impactwhen one factors in the environmentaldegradation avoided by the replacement offossil-fuel sources, as well as beneficialsocial impacts including job creation andreduction of total dependence on external,centralized electric power. The tax incen-tives specified by the Plan may be ineffec-tive in realizing the variety of contributionssolar energy can make.

Solar energy is a renewable energy sourcewhich has undeniable long-term applica-tions. Additionally, solar technologies havesome immediate applications. On a life-cy-cle costing basis, solar space and waterheating is competitive with electric spaceand water heating in many parts of thecountry. Use of solar equipment to produceair-conditioning, mechanical power (forpumps and other appl icat ions) , andelectricity is technically feasible now buttoo expensive to compete with conven-tional energy sources in any but a fewspecialized applications. The market for allsolar equipment may grow rapidly evenwithout Federal support as the price of non-solar energy sources increases. The policywhich keeps the cost of residential energylow is a great disincentive to solar energy.

169

Additional incentives for solar tech-nology may be needed to achieve even thelimited solar goals of the Plan. Specifically,solar incentives, along with energy conser-vation measures, are needed for new-starthousing. Some States have mandated in-stallation of extremely inexpensive equip-ment which will permit the installation of,or retrofit to, solar water heating. Because ofthe overriding public policy considerations,mandating solar installation, where ap-propriate, or at least evaluating solar waterand space heating has been considered. in-creased loans for small businesses wouldhelp develop the solar market in the smallindustry-commercial sectors. Making non-profit organizations eligible for guaranteesunder the amendments to the Energy Policyand Conservation Act would also increasemarketability. Mandating consideration ofsolar technologies where appropriate forFederal and State building programs wouldencourage public acceptance. Further,public acceptance can be heightened byrewarding States and localities for planswh ich emphas i ze renewab le energysources, through matching grants, revenuesharing systems, or various other Federalprograms.

Additionally, the Plan mentions threespecific legal and regulatory impacts of im-plementation of solar technology-+ quip-ment certification and installation, legalprotection of incident sunlight, and utilityrate regulation which affects solar userswhen backup power is required, The Planomits specific recommendations in theseareas, but encourages State and local action,The imprecision of these recommendationsfurther diminishes the l ikelihood of ex-peditious implementation of solar tech-nologies. (See Issue #1 O, on State-Federalrelations. )

Finally, in the general area of alternativetechnologies, the Plan fails to address theissues of economies of scale, respectivecapital and labor requirements of thevar ious energy sources , and soc ia l ,demographic, and environmental impacts.For example, biomass conversion for porta-ble fuels, and medium- and small-scaleenergy production systems, except for dis-trict heating, are not discussed. A growingnumber of energy specialists believe thatthe long-range implications of the social,environmental, and demographic impactsfavor the careful matching of energy qualityto end-use requirements and the use of de-centralized, renewable energy sources.Because of the variety of solar technologies,its applicability to a variety of applicationsmust be considered.

The Plan limits institutional attention ofsmall-scale alternative technologies to crea-tion of an Office of Small-Scale Technology(p. 80). The Energy Research and Develop-ment Administration’s Office of Small-ScaleTechnology is currently authorized at $5million for 1977-78. To have a sufficient im-pact on policy-program design, the ad-ministrative structure for alternative tech-nologies should be prominent and wellfunded. Compared to the funding level ofconventional energy sources, the currentfunding of the Office of Small-Scale Tech-nology may be insufficient,

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Issue 8

IndoorEnvironments

Energy conservation in buildings mayaggravate some existing healthproblems and create new ones.

Summary

Tight insulation in buildings and in-creased recirculation of indoor air in air-con-ditioning systems are effective tactics ofenergy conservation. However, these tacticsmay substantially increase concentration ofpollution indoors. Further, recommendedindoor temperatures need to take into ac-count in a systematic manner factors ofhealth, behavior, and efficiency.

Questions

1. How much is known about the effectsof tight insulation and recirculating air-ventilation systems in concentratingpollutants indoors?

2. How much work has been done onways to ensure that energy-conservingbuilding designs and energy-conserv-ing modifications to existing buildingsare compatible with clean indoor air?

3. What are the projected increases in in-door environmental contaminationfrom the increased use of potentiallyor demonstrably hazardous insulationmaterials (e. g., asbestos, rockwool,fiberglas) ?

4 Does the range of indoor temperaturesrecommended for summer and wintertake into account the temperature sen-sitivity of special population groups(e.g., the elderly, the chronically ill),the possible effects on susceptibilityto infectious diseases, and the effectson performance efficiency?

Background

Although Americans spend about 75 per-cent of their time indoors, it was not untilrecently that studies of indoor pollutionwere commissioned; present information onthe health aspects of indoor environments isvery limited. In promoting conservationmeasures in buildings, such as insulation (in-cluding weatherstripping, caulking, andother measures for thermal isolation), use ofrecirculated air, and restraint in heating andcooling, energy policy should fully take intoaccount the poss ible effects of suchmeasures on health.

Indoor air quality can be worse than thatoutdoors especially for particulate, includ-ing toxic substances like asbestos. Asbestosreaches air in rooms mostly from indoorsources, such as use of asbestos-containingtalcum powders and the blowing ofasbestos fibers into rooms from asbestos-Iined ventilation ducts and wall interiors. Inaddition, gases such as carbon monoxideand nitrogen oxides can build up indoorsfrom the burning of natural gas or oil forhome heating and cooking. Lead is some-times present in higher concentrations innonindustrial buildings than outdoors. Toxicorganic vapors arise indoors from cleaningfluids and aerosol sprays. Tobacco smokingfurther deteriorates indoor air quality.

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Improved insulation of buildings pro-posed by the Plan will tend to seal in airpollutants and toxic substances in thecourse of achieving its primary purpose,which is to retain heated and cooled air. In-creased recirculation in forced ventilationsystems also will concentrate pollutants.

Although improved insulation is stronglyencouraged only for residential buildings,rising fuel costs and tax incentives for fuelconservation could result in increased in-sulation for all types of buildings, and adecrease in fresh air in forced ventilationsystems, This could, for example, affect thetransmission of bacteria and viruses inhospitals, and schools, and other publicbuildings.

A preliminary study at Lawrence BerkeleyLaboratory under cont ract to ERDA(LBL-5918) suggests that some indoorpollutants in the home may rise to levelsseveral times those in peak polluted out-door urban areas when the air-change rateapproaches that being considered forenergy conservation purposes. A moreimaginative approach to energy conserva-tion could take advantage of buildingdesign features which promote both energyconservation and good indoor air quality.

The effects of temperature on perform-ance, health, and disease transmission havenot received the attention they deserve, ex-cept for the extremes of heat and cold. Per-sons with heart disease, for example, arevery sensitive to heat’ and their chances ofsurviving a heat wave are smaller withoutair-conditioning. Because daily mortalityrates in cities change significantly withslight changes of temperature and humidity,there is reason to suspect that there aremore subtle effects as well.

Issue 9

HealthEffects ofDiesel-PoweredAutomobiles

The National Energy Plan indirectlyencourages the use of diesel-powered automobiles but little con-sideration has been given to theunregulated harmful emissions ofdiesel engines.

Summary

The automobi le gasol ine eff ic iencystandards of both present Federal legislationand of the energy plan indirectly encouragethe use of fuel-efficient, diesel-poweredautomobiles. Although diesels produce lesscarbon monoxide and hydrocarbons thando gasoline engines, they may also producegreater amounts of harmful sulfates and fineparticulate.

Questions

1.

2.

What diesel market penetration hasthe Admin i s t ra t ion as sumed fo rpassenger cars and light and intermedi-a te t rucks fo r i t s p ro ject ions o fautomotive energy demand to 1985?To 1990? To 2000?

Have studies been undertaken of theunregulated emissions from dieseltechnology? What are the potentialhealth effects of diesel automobiles,especially in dense urban areas?

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3. What studies have been undertaken toassess the real fuel savings related to alarge-scale adoption of diesel tech-nology for passenger car service? Whatare the results?

Background

Federally mandated fuel economy stand-ards in effect for 1978-85 model year cars(27.5 MPG fleet average for 1985) have pro-duced considerable interest on the part oflegislators, automakers, and agencies suchas the Transportation Department in dieseltechnology for passenger cars. GeneralMotors Corp. will introduce a diesel enginein one of its lines in 1978. Others mayfollow its lead; foreign diesel-poweredautomobiles are already available. Somesources have assumed a 25-percent dieselmarket penetration, especially in large cars,by the 1985 model year.

Diesels are inherently fuel efficient andproduce relatively low carbon monoxideand hydrocarbon emissions, although emis-sions of nitrogen oxides with present tech-nology exceed current statutory standard of0.4 grams per mile. However, diesels alsoproduce a number of unregulated emissionsthat could, under heavily congested condi-tions, become a serious public healthhazard.

Like conventional spark-ignition internalcombustion engines, diesels emit a varietyof air pollutants, odors, and noises, but ofdifferent degrees and kinds. The importantemissions from diesel engines include visi-ble smoke and fine carbon particles, sulfatesand sulfur dioxide, aldehydes, and selectednonreactive hydrocarbons, as well as theconventional gasoline engine emissions.

What little is known about diesel emissionssuggests the need for considerable caution.This is particularly true for a group of com-pounds known as polycyclic organic matter(POM).

The partial combustion of organic matterproduces POM, which contains two classesof carcinogens: 1 ) polycyclic aromatic hy-drocarbons, and 2) aza-arene heterocycliccompounds. Numerous types of POM havebeen measured in soot: pyrene, anthacene,benz(a)anthracene, benzofIuoranthenes,chrysene, coronene, fluoranthene andbenzo(a)pyrene. A number of these havebeen found to be carcinogenic in animal-ex-posure studies.

The internal combustion engine also is asource of POM, but current efforts to reduceother emissions from such engines have alsoreduced POM emissions. Anticipated futuremeasures point toward continued reduc-tions as a result of catalytic controls.However, careful attention should be paidto the misuse of diesel-powered vehiclessuch as overloaded operation or poor main-tenance. Idle operation typical of congestedurban centers results in high POM emissionsfrom diesels.

The bulk of POM from diesels is thoughtto be associated with fine particulate aero-sols. As a result, POM longevity depends onboth the rate of its chemical alteration andthe lifetime of its carrier aerosol. Estimatesof the lifetimes of fine aerosols exceed 100hours and range up to 40 days. POM mayundergo chemical reactionhours or up to a few days,

within a fewdepending on

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SocietalImpacts

degree of exposure to sunlight. in addition,some of the products of POM reaction withoxygen may also be carcinogenic.

Recent studies have shown that 90 per-cent of the particles in diesel exhaust areless than 1 micrometer and that 50 percentare about 0.3 micrometers or smaller. Thesesizes are precisely within the range which isrespirable and which is deposited withinpulmonary air spaces. There is significant re-tention within the lung of aerosols of thissize. In addition, retention is increased byhydroscopic sulfate which is present indiesel emissions.

There presently are several active proj-ects under EPA sponsorship to determinewhether diesel engines emit nitrosamines orany of their potential precursors (in additionto nitrogen oxides). However, it is notknown if any studies are underway that ad-dress the retention of fine diesel particles inanimal lung tissue. Such experiments shouldbe carried out before any large changeoverto diesel-powered autos or light-duty trucksoccurs.

Issue 10

The Roleof Stateand LocalGovernments

Unless State and local governmentshave substantial responsibility for na-tional and regional energy policy, thegoals of the National Energy Plan maybe jeopardized.

Summary

The Plan calls for a “foundation ofpartnership and understanding” in the im-plementation of a va r ie ty o f energyprograms, built upon “active roles” and“major responsibilities” for State and localgovernments. W i t h f e w e x c e p t i o n s ,however, it is not clear what these roles andrespons ibi l i t ies are to be. In fact, b y

emphasizing the leadership role of theFederal Government and largely ignoringproblems of intergovernmental coopera-tion, the plan appears to downgrade the im-portance of other levels of government inenergy decisionmaking. This is partly anissue of the nature of federalism in theUnited States, but it is also a question ofhow to identify and respond to regionaldifferences in economies, environment,resources, and social conditions. Nationalenergy policy will not only have to takesuch differences into account, but reconcilethem in a cooperative manner with con-tinuous interaction and participation of thegovernments and peoples affected. Failureto do so could jeopardize success of thePlan.

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Questions

1. To what extent does the Plan set thestage for a major change in planningand regulatory functions now exer-cised by the States?

2. To what extent has national energyplanning anticipated the great degreeof cooperation that will be required bythe States to implement the strategiesof the Plan?

3. What will be the role of State and localgovernments in: (a) returning rebatesfrom energy price increases and taxesto the consumer? (b) developing andenforcing energy efficiency standards?(c) facilitating the development ofalternative energy sources?

4. Could State governments be given arole in the classification of oil and gasproduction as “new” or “old?”

Background

The Plan emphasizes the importance ofState and local government participation inthe process for making energy resourcedevelopment decisions. And, in some areas,the Plan defines future State and local im-plementation roles. For example, attentionis given to State enforcement of the 55miles per hour speed limit, State respon-sibiIities in public utiIity reforms and conser-vation services, and State review of pro-posals to expedite the movement ofAlaskan oil from the West Coast. In mostcases, however, the Plan only mentions apossible State or local responsibility or im-plies some future intergovernmental re-quirement.

The only specific reference to an activepositive role for State or local governmentsinvolves State utility commissions, whichare directed to reform rate structures in ac-cordance with Federal guidelines. There is ageneral reference to an unspecified role forStates in the development of geothermalresources (p. 78) and in the proposedenergy information system (p. 89). Other-wise, States are essentially treated by thePlan as enforcers of Federal laws and stand-ards (pp. 40, 63, etc. ) or allocators of Federalfunds (pp. 42, 77, etc.). In some cases theylose powers that they now have (e.g., overthe pricing of new gas for intrastate marketsand over cogenerated electricity). The dis-cussion of nuclear facility siting and licens-ing (p. 72) does not mention State govern-ments at all, even though the NuclearRegulatory Commission has recognized thatthe positive involvement of States is essen-tial to effective nuclear facility regulation.

This appears to represent a reduction ofthe present role of State governments inenergy policymaking. State governmentsnow play a central role in the regulation ofresource extract ion, surface mining,reclamation, energy faciIity siting, electricitypricing and transmission, and in enforcingmineral rights laws on other than Federallands. In addition, many States are active inenergy conservation efforts, energy demandestimation, and comprehensive energyplanning. Local governments engage inland-use planning, enforcement of buildingcodes, and a variety of other activities thatinfluence energy supply and demand. It haseven been suggested that a “new federal-ism” has been formed in recent years, inwhich the States have been restored to a fullpolicymaking partnership with the FederalGovernment.

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Without significant roles and respon-sibilities for State and local governments,and a reconciliation of Federal policies withState policies, a National Energy Plan runsthe risk of failing to reach its goals. Althoughthe Plan does not exclude a strong Staterole, it does not assure it. Examples of caseswhere State and local responsibilities needto be clarified or conflicts resolved include:

1.

2.

3.

4.

5.

6.

In

The implementation of the policy ofconversion to coal;

The role of the States and localities inresidential/commercial weatherizationprograms;

The requirement that State energyoffices “encourage” fuel suppliers toundertake conservation services similarto those offered by State utilities;

State responsibilities in the siting ofnuclear energy facilities;

The exemption from State ut i l i tyregulations for cogeneration facilities;

The role of the States in alternativeenergy resou rce deve lopment—specifically the need to encouragewaste heat utilization, to overcomethe barriers to using solid waste as afuel , to faci l i tate the leas ing ofgeothermal resources, to modify prop-erty taxes to encourage the use of solarenergy, and to develop criteria andstandards for solar equipment.

addition to these areas requiringfurther explanation, almost nothing is said inthe Plan about the roles of State and localgovernment in channeling tax rebates to theconsumer. Nor is there an adequate ex-amination of the role of the States andlocalities in determining and enforcing man-datory energy-efficiency standards for newbuildings and certain home appliances.

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Finally, the Plan does not adequatelyidentify and explain the role of State andlocal governments in its proposed energyinformation program, (See Issue #1 2.)

In part, this raises serious questions aboutthe implementation of the Plan as a truly na-tional plan-not just a Federal Governmentplan. In a broader sense, the Plan’s pro-posals are insensitive to regional differencesin the economic, environmental, and socialimpacts of energy programs, For example,new coal production will be limited to afew regions, which makes the Plan an instru-ment of economic growth and a regionalallocator of undesirable effects. Althoughthe Plan shows a clear concern with equity,it overlooks the likelihood that some in-equit ies in benef i ts and costs wi l l beregional. The process for dealing with theseeffects (and the regional concerns thatanticipate them) will need to incorporateState and local governments as full partners.In particular, they might help on “fine-tun-ing” energy programs to adjust to local cir-cumstances,

The details of Federal-State relationshipsare as important as the policy conflictsthemselves. For example, Outer ContinentalShelf oil development, strategic and tacticalplanning for Alaskan North Slope oil, andWestern Federal coal and geothermal leas-ing could be facilitated by new planning ar-rangements, New policy proposals such asthat of conversion to coal will also have totake into account a series of complex factorsincluding local preferences for diversity andr isk avers ion, ai r qual i ty constraints ,logistics, and potential land- and water-useconflicts. For example, if conversion to coal

becomes national policy, the States shouldshare in setting federally supervised exemp-tion provisions and/or alternative technicalcompliance schedules.

Finally, in many cases the States are bestable to determine the most appropriate in-ternal agency or agencies to administerdelegated Federal programs. State-to-Statevariations in institutions and infrastructuremay require delegation of responsibility tothe States for efficient administration ofsuch programs.

Issue 11

The Impactof UtilityRate Reformon Federal-StateRelations

The National Energy Plan does notfully address the consequences ofsome of its proposals for the tradi-tional relationship between State andFederal utility regulatory agencies.

Summary

The traditional relationship betweenState and Federal regulatory agencies hasbeen formulated over a long period and pro-vides a forum for the development ofdiverse and innovative approaches. Severalaspects of the National Energy Plan wouldsignificantly increase the authority ofFederal regulatory agencies (particularly thatof the proposed Department of Energy) byproviding mandatory requirements inseveral areas where State commissions nowhave exclusive jurisdiction. Thus, the Plancould lead to changes or modifications inthe historical roles of Government or ad-ministrative agencies in energy-relatedareas. The long-range consequences ofthese changes should be fully explored anddebated.

Questions

1, To what extent could the Plan’s pro-posals disrupt well-established rela-tionships between Federal and Stateregulatory bodies ?

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SocietalImpacts

2. Are there alternative approaches thatmight be less disruptive and equallyeffective ?

Background

Several aspects of the Plan would sub-stantially increase the authority of Federalregulatory agencies in matters now theprovince of State commissions. Federalauthority in mandatory weather-proofingprograms, conversion strategies, and na-tional utility rate standards are examples offundamental changes proposed by the Plan.The proposals for national rate designstandards are a good case in point.

The Plan’s approach is similar to those ofthe Clean Air Act and the Federal WaterPollution Control Act. States are given aperiod within which to demonstrate thatthey can enforce national standards; if theyfa i l to meet nat iona l l y dete rm ineddeadl ines, responsibi l i ty shi f ts to theFederal level. One major difference is that atthe time the clean air and water pollutionacts were adopted, States did not have theexperience and competence in environmen-tal law that they have in utility regulation.

While there is general agreement thatpeak-load pricing for electric utilities canlead to energy savings, for example, thereare situations in which the problems ofoffering such rates might outweigh the ad-vantages. Mandatory national standardsmight override such atypical situations andcreate conflicts with State regulatorypolicies. A national standard should be usedonly where national interests cannot other-wise be protected. One possible alternativeapproach would be to offer Federal funds tosupport State regulatory activities on thecondition that a State undertake research

leading toward programs to implement thePlan’s broad goals. In rate design, for exam-ple, a State might be obligated to imple-ment rates that would advance the conser-vation of oil and natural gas in order toqual i fy for Federal funds. Th is wouldpreserve the concept that the Nation’senergy situation is serious enough to war-rant national policies which State regulatorsmust follow.

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Issue 12

InformationSystems

The National Energy Plan may notmeet the needs of State and localgovernments for reliable and credibleinformation to use in their energyplanning and programs.

Summary

The Plan proposes a three-part energy in-formation program designed to inform theFederal Government on petroleum produc-tion and reserves, possible anticompetitivebehavior of major oil companies, and localenergy supplies and consumption patternsfor use in supply emergencies. Except forcollecting and maintaining data on localsupplies and consumption patterns, the roleof State and local governments is notspecified in the Plan. For example, it is notclear what information on petroleum pro-duction and reserves and petroleum com-pany finances will be made available to theStates, although data of this type is impor-tant in State energy planning and policydevelopment. In general, detailed and relia-ble information is needed by all levels ofgovernment if the overall objectives of thePlan are to be met.

Questions

1. What specific Information will Statesbe charged with collecting and will theFederal Government provide fundingand technical assistance to the Statesfor this endeavor?

2.

3.

4.

Will oil and gas reserve data and theinformation about company financesbe available to State and local govern-ments or will the data be treated asproprietary and withheld?

State and local governments need in-formation in connection with energyfacility siting and licensing proposals.How will this need be met?

Will data be made available to theStates in a quickly accessible manner,for example, through computer ter-minal links?

Background

The National Energy Plan proposes a three-part energy information program:

1. A petroleum production and reserveinformation system.

2. A petroleum company financial datasystem.

3. An emergency management informa-tion system.

These three systems meet a number ofhigh-priority information needs of theFederal Government. However, except forcollecting and maintaining data on localsupplies and consumption patterns, theroles of State and local governments in theenergy information program are not dis-cussed. This seems to overlook the substan-tial requirements for reliable information ofgovernments outside of Washington, D. C.,on which to base energy planning andpolicies, including allocation and con-tingency programs. For example, it is notclear whether State governments wouldhave access to the petroleum productionand reserve information system or thepetroleum company financial data system.

SocietalImpacts

Information shortages are a generalproblem in energy policymaking, and havemade it difficult for all levels of governmentto deal effectively with energy problems. Amajor consequence has been that manypublic officials and private citizens are notconvinced that a serious energy problem ex-ists.

Information shortages are particularlyacute at the State and local levels. What ap-pears to be reasonably adequate data on anational scale often turns out to be inade-quate when put to the test of providing sup-port for State or local programs. Theproblems include: (1) the aggregation ofdata on a national or large regional scale,when State/ local concerns are moredetailed; (2) the selection of factors to bemeasured, which may omit items of localconcern; (3) a lack of timely access, eitherbecause Federal data are not made availableor because States and localities find itdifficult to determine what is available; and(4) a question of credibility, when Federaldata have not been subject to verificationby State or local representatives.

Involving State and local governments inan extended energy information programwould improve the information base andenhance its credibility. In addition, it wouldassist State and local governments to dotheir part in implementing the energy planmore quickly and effectively. One alterna-tive, for example, would be to expand theproposed emergency management informa-tion system to a more comprehensiveenergy management information system,exchanging information about demand pro-jections and baseline environmental charac-teristics (collected locally) for informationabout technology characteristics and sitingprojections (collected nationally).

Issue 13

PublicParticipationin EnergyDecisionmaking

Failure to develop mechanisms forcontinuing participation by thepublic in energy decisions will makesuccessful implementation of the Na-tional Energy Plan more difficult.

Summary

As presently formulated, the Plan doesnot provide any formal mechanism forpublic participation in the formulation andimplementation of energy policy. Such par-ticipation is a prerequisite for successful im-plementation of the Plan. Public involve-ment provides a way for citizens to com-municate their concerns to decisionmakersat all levels and a framework for com-municating governmental proposals andtechnical information to the public. With-out a well-defined role, citizens may becautious about-or even oppose-Govern-ment policy. Because effective participationrequires technical expertise and full-time at-tention, financial support could be ex-tended to groups with limited resourcesthat desire a role in the shaping and imple-mentation of the Plan.

Questions

1. Is there a Federal commitment toestablishing programs for public par-ticipation in policy decisions thatwould broaden public understandingand open channels for citizen responseto policy proposals?

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2.

3.

4.

Will procedures be established to pro-vide citizen groups with reliable andcredible energy information ?

Because effective public participationrequires technical expertise and, attimes, legal representation, can publicfunds be provided to ensure thatgroups with limited resources can helpset policy proposals?

Can administrative details of the Na-tional Energy Plan be effectively coor-dinated through existing agencies toavoid proliferation of bureaucracieswith which citizens must deal ?

Background

During the past decade, public insistenceon participating in policy decisions has in-creased. Requirements for public participa-tion programs have been written into manyFederal laws, in recognition of the fact thatindividuals and groups who are not part ofdecisionmaking institutions are affected byGovernment decisions and frequently cancontribute information and judgments thatimprove public policy. There also is recogni-tion that in a republic, public policy requirespublic support if it is to succeed. An in-formed and supportive public consensus iscrucial to policies as basic as energy policieswhich will require some sacrifice, or at leastsome change of habits, by all Americans.

Public consensus on energy policy is par-ticularly difficult, because awareness that anenergy problem actually exists still is grow-ing and there is no majority opinion aboutits causes or its consequences. The willing-ness of people to support new energypolicies will depend entirely on their under-standing of the problem in detail.

The National Energy Plan acknowledges aneed for comment on energy-related legisla-tive proposals as they are considered byCongress and on administrative proceduresas they are implemented. The Plan also indi-cates that the Administration wilI encouragebroad national discussion of its proposals.However, the Plan does not describe aprogram for achieving structured public in-volvement.

Several steps must be taken to involvethe public in energy policy. Access to thedecisionmaking process must be available.A national energy data center should beestablished to provide reliable and credibleinformation about energy resources andreserves, the characteristics of energy tech-nologies, and proposed energy faciIity sitingschedules, Information will best meet thetests of reliability and credibility if it is: (1)responsive to the concerns of interestedparties, (2) produced by people or institu-tions who are perceived as being profes-sionally competent, and (3) produced bypeople or institutions without a vested in-terest in the decisions to be based on the in-formation. Information also must flow inboth directions. Public involvement, for ex-ample, could facilitate the identification ofimportant secondary design goals i nresearch and development programs andthe evaluation of prototype demonstrationsof technologies prior to a commercializationdecision.

The l inkage of citizens with energypolicymaking may require that Federal fundssupport broad participation. Participantswith limited financial or technical resources

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SocietalImpacts

often find it difficult to enter into discus-sions of energy technologies with industryor Federal agents because technical detailsare not available to them. Financial supportfor these parties would ensure that they candevelop professional staff representation.

The particular aims of a program forpublic participation must be: (1) to involvethe public early in the policymaking proc-ess; and (2) to make public participation astandard part of policymaking. Manycitizens (and some local and State govern-ments as well) do not have a clear picture ofhow energy policy decisions are made.When avenues for public participation areblocked, citizens often use legal and politi-cal means to delay proposed actions. Earlyand regular involvement is one way to in-crease public understanding of energyproblems and policies and to permit publicsharing of responsibil ity for the conse-quences of policy.

Issue 14

RegionalImpacts

Implementation of the NationalEnergy Plan will have serious and in-equitable impacts on some regions ofthe country.

Summary

Energy-use patterns, the presence and ex-tent of energy resources, and environmen-tal, economic, and social conditions varyconsiderably among the regions of thecountry. As an overall approach, the Plandoes not give these problems sufficientweight or recognition. As a consequence,social, economic, health, and environmentalimpacts that will occur when the Plan is im-plemented will be distributed inequitablyamong various regions of the country. Forexample, regions that produce and exportenergy will absorb most of the impacts ofenergy resource development; regions thatalready have air quality problems will sufferfrom the Plan’s emphasis on coal conver-sion; regions whose industries wil l beaffected by conservation and higher energyprices wil l disproportionately bear theeconomic costs of the Plan.

Whi le the P lan notes that regionaldifferences exist, it does not indicate howthey are to be identified, what equalizing ormitigating actions will be taken, or what therole of State governments and other in-terested regional parties are to be. It maynot be possible in setting national policy to

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meet the needs of all regions of the country,particularly when some regional needs con-flict with national needs. However, it ispossible to seek equitable regional distribu-tion of impacts. Failure to do so, and failureto involve States and regional organizationsin the process, may mobilize opposition tothe Plan.

There is a need for review and evaluationof existing regional intergovernmentalorganizations and agreements to determinetheir adequacy. Organizations and regionalcompacts may have to be restructured andrewritten in order to deal coherently withenergy problems.

Questions

1.

2.

3.

4.

5.

H o w a r e s i g n i f i c a n t r e g i o n a ldifferences that will affect the equita-ble distribution of impacts to be iden-tified ?

What mitigating actions are to betaken with regard to the regional dis-tribution of impacts?

Can policies be developed to accom-modate regional diversity through flex-ibility in the application of regulations,rules, timetables, and tax rates?

Could the regional impacts of the Planbe addressed by establishing regionalgroups of States to work out ways ofdeal ing with envi ronmental andeconomic impacts?

What can be done to protect airquality and human health in areas suchas Southern California, where coalburning would aggravate alreadyserious air quality problems?

Background

The National Energy Plan will cause awide range of impacts, some of which willbe peculiar to, or more serious in, someregions of the country. Impacts on com-munities in coal-producing regions, par-ticularly in the West, could be particularlysevere, as could impacts of increased use ofcoal in areas which already have serious airquality problems.

Increased Coal Production.—To achievethe objectives of the Plan, coal productionin the East, Midwest, and West must in-crease significantly. Increased mining in theEast and Midwest will take some pressureoff of the environment and establishedcommunities in the West. All three regions,however, may be asked to bear burdens inthe national interest. In many cases,development can result in s ignif icantchanges in land- and water-use patterns, airand water quality, and lifestyle.

I n t h e W e s t , for example, energydevelopment will occur for the most part ins p a r s e l y p o p u l a t e d , p r e d o m i n a n t l yagricultural areas. Farmers will be displacedand some of their water supplies will bediverted to coal producers.

Some of the most severe impacts in theWes t w i l l re su l t f rom energy - re la tedpopulation increases. In small localities, ex-isting schools, medical services, and waterand sewer facilities could not cope with asudden influx of population, and in manycases could not be expanded fast enough tomeet the needs of growing communities.Capital to expand needed public servicesand facilities will not be available to mostlocal governments in the short term. Overthe long term, revenues from energy pro-duction usually will go to counties, whilethe greatest demand for services and

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SocietalImpacts

facilities will occur in towns. Lending in-stitutions often hesitate to make loans forhomes or other private facilities in com-munities which are in a boom and bust cy-cle.

The mismatch between the demand forservices and the capacity of local govern-ments to deal with boomtown situationscan result in a wholesale degradation of thequality of life in some communities, Statehelp would be available in such situations,but the Federal Government also has a roleto play, since national policies often willtr igger projects that cause boomtownproblems. The Plan should specifically ad-dress creating a system for evaluating suchimpacts and for providing Federal assist-ance.

Few Federal housing, water and sewer,and transportation programs were designedto respond to the needs of communitieswhich are disrupted by major new energyproduction projects, Some Federal programsare being modified but assistance programstailored to the needs of such communitiesare needed,

Conversion to Coal.—The NationalEnergy Plan proposals to increase the use ofcoal wi l l have considerably di f ferentregional impacts than the coal productiongoals discussed above. By shifting industryand utilities from oil and gas to coal, airquality problems almost certainly will beexacerbated in regions that already have airquality problems, even when the bestavailable control technology is required,.

Some areas such as Southern Californiawill not be able to burn coal without creat-ing se r ious health hazards. Oi l - f i redpowerplants were not originally designed toburn both oil and coal and must bereplaced. There is no transportation systemto deliver coal. In addition, most SouthernCalifornia powerplants are in denselypopulated air basins where air quality isalready bad. Conventional coal plants, evenwith the best available control technology,are likely to emit more particulate andsulfur than State law allows. Clean burningsys tems such as low-B tu gas i f ie r s o rfluidized-bed coal combustion may resolvethese problems, but these technologies arenot likely to be commercially available untilthe late 1980’s.

If coal is to be used in California, moreeffective air quality control than that pro-posed by the Plan will be required. TheFederal Government already has a substan-tial coal conversion R&D program, but itsfocus has been primarily on basic processtechnology and economics. Reorienting theprogram to accelerate development of cleancoal technologies could help. In addition,the coal conversion schedule in the Plancould be adjusted to select a more realisticclean-coal commercialization timetable. Forexample, combined cycle powerplantscould be exempted from taxes on oil useuntil 1990, especially where coal conver-sion and new coal-burning capacity arelimited by special regional economic andenvironmental characteristics. Oil and gastaxes could be deferred in cases whereStates produced a long-range coal conver-sion schedule consistent with nationalgoals. in such cases, States could administerconvers ion programs with occasionalFederal monitoring.

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Issue 15

EnergyResourceDevelopmenton FederalLands

The National Energy Plan does notidentify and define the role that Stateand local governments are to play inenergy resource development onFederal lands.

Summary

The acceleration of domestic energydevelopment mandated by the Plan will de-pend significantly on increased productionfrom resources on Federal lands. The pro-duction goals of the Plan are not likely to bemet unless controversies and problems con-cerning the management of Federal landsare resolved.

Much of the accelerated developmentcalled for by the Plan will probably occur onFederal lands in the West. State govern-ments in the West have expressed concernthat the current Federal land-managementsystem does not adequately provide forState participation in decisions about whichresources are to be developed and whichrules and regulations are to apply todevelopment. Specifically, some Stateofficials object to current procedures whichallow developers to nominate areas fordevelopment, al low States and otherregional interests to object to the nomina-tions, but leave the final judgment toFederal officials. States also are concernedabout long delays between nominationsand development which characterize the

present system. In addition, they are con-cerned about whether effective controls canbe appl ied when producers act ivatehundreds of dormant coal leases that weresigned years ago.

The Administration has acknowledgedthat problems exist in current Federal landmanagement programs. However, if thePlan’s production goals are to be met,problems and controversies associated withmanaging the development of federallyowned energy resources will have to be ad-dressed more directly, particularly thoseproblems relating to the role of the States indetermining which resources are to bedeveloped, which laws and regulations areto be applied, and whether accelerateddevelopment can occur without com-promising important economic, environ-mental, and social values.

Questions

1.

2.

3.

What role will State governments playin managing and contro l l ing thedevelopment of federal ly ownedenergy resources ?

Can a land management system beestablished which will protect environ-mental, social, and economic valuesand sti l l allow for acceleration ofp u b l i c r e s o u r c e d e v e l o p m e n t ?Specifically, can the present mineralleasing system for federally ownedresources be streamlined without com-promising environmental standards?

What can be done to control produc-tion of coal on land that was leasedyears ago?

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SocietalImpacts

Background

Historically, public lands have beenprime candidates for development becausethey are under direct Federal control. TheFederal Government owns or controls vastholdings of coal, oil, natural gas, oil shale,and uranium, particularly in the West. Anyattempt to greatly accelerate the develop-ment of domestic energy supplies will de-pend upon the expeditious development ofthe resources located on these public lands.

In the Rocky Mountain-Great Plainsregion, the Federal Government owns about43 percent of the land and controls morethan 60 percent of recoverable coalreserves, 80 percent of the estimated oilshale potential, and more than 90 percent ofrecoverable uranium.

At the present time the West is produc-ing approximately 11 percent of the Na-tion’s crude oil. It is estimated that 10 per-cent of the Nation’s natural gas reserve is lo-cated in the region, as well as 42 percent ofthe coal, and 94 percent of the uranium. Allof the Nation’s high-quality oil shale is inthe West. It is estimated that 80 percent offuture coal development in the West willoccur on Federal land or will involvefederally owned resources.

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The production potential implicit in theabove data is obvious. However, there are anumber of significant problems that must beresolved if this production potential is to berealized. For example, several WesternStates are concerned that they will not beable to influence development on Federallands. Some States have more stringent lawsand regulations governing developmentthan does the Federal Government. This hasled officials in these States to argue thattheir responsibility to protect the health,welfare, and safety of their citizens will becompromised if State laws and regulationsare not applied, first, in designating areas asunsuitable for development, and second, tocontrol resource developments on Federallands. These issues are beginning to beresolved. Recently, the Secretary of the In-terior negotiated agreements with Wyo-ming which permit more stringent Statecontrols to apply to development. TheDepartment is also reviewing State reclama-tion statutes. When State requirements areas stringent or more stringent than Federalrequirements, States will be given as muchcontrol on Federal lands as is constitu-tionally possible. Federal strip mine legisla-tion pending before Congress contains aprovision for the application of Statereclamation laws. An issue which is stillunresolved is whether States should be ableto apply broad energy facility-siting laws todevelopment on Federal land, Becausemany Federal projects are planned for loca-tion on public lands, the States’ roles withrespect to siting criteria must be resolved inthe near future.

set of procedures that allow for the nomina-tion of lease sites by potential developersfollowed by “disnomination” suggestionsby State governments and other interestedparties. A particular lease could be disnomi -nated on the grounds of its general un-suitability, the unusual nature of an area, orthe expected acute adverse effects of thedevelopment, Under the present system,the Federal Government asserts a right tomake preemptive decisions, a position thatthe States are challenging. Unless thischallenge is dealt with, development onFederal land will be likely to proceed evenmore slowly than it does now.

The leasing system itself is only one of anumber of steps that must be taken todevelop Federal resources. The environmen-tal impact statement process must be com-pleted and numerous State and Federal en-vironmental requirements, such as air- andwater- quality standards, must be met.Therefore, while the decision to issue alease is usually based upon very few criteria,a potential developer, after he has obtainedthe lease, must go to a number of State andFederal agencies seeking various permits.Since these processes (i.e., leasing, environ-mental impact statement, and acquiringvarious permits) are generally independent,it can take us as long as 10 years to open acoal mine after a developer expresses in-terest in a given site. A new leasing systemthat would allow for the early considerationof a variety of important environmental,social, and economic values put forth byFederal, State and local governments could

A second issue which has significantlydelayed the development of Federal coalreserves is the present mineral leasingsystem, The leasing system is a complicated

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SocietalImpacts

greatly speed up the process. If these valueswere established as criteria for a lease, notonly would there be more competition forlease sites, but the lease would be im-mediately consistent with the requirementsof State and Federal environmental stand-ards. In all, the processes of environmentalimpact statements, the review and issuanceof the lease, and the application of environ-mental standards through various permitscould be compressed into a unified process.

The final major problem which existsconcerning the development of Federalresources is the fact that more than 400 in-active or undeveloped lease sites now existthroughout the West. For years, developersbid on, and received, coal leases that theydid not intend to develop immediately. In-stead they held these in an inactive statusawaiting a rise in the price of coal. Theseleases were made at a time when little at-tention was given to environmental values.Consequently, public interest groups andGovernment officials alike are now greatlyconcerned that if these sites are developed,a high degree of environmental degradationwill result. As improvements are made inthe leasing system generally, these non-producing sites must be examined for theirpotential as well as their social and environ-mental impacts.

Issue 16

Coordination ofEnergy-RelatedPrograms

Some Federal policies and programsmay be incompatible with the goalsof the National Energy Plan.

Summary

Many Federal programs were establishedlong before it was clear that the UnitedStates faced a major energy problem. Someprograms, for example in transportation,may not be compatible with the goals of thePlan and may, in fact, require actions thatwould work at cross-purposes with energypolicies. In some cases, the conflicts can beresolved by Executive Order. In others, Con-gress may have to choose between energygoals and goals in other programs andamend laws to reflect that choice, Althoughadoption of the Plan need not await anidentification and resolution of Federalprogram inconsistencies, effective manage-ment of the Plan will require such a review.

Questions

1. What process should be used to iden-tify Federal programs that are not com-patible with the goals of the Plan?

2. When a program supporting an EnergyPlan goal and a program in support ofsome other national goal are found tobe incompatible, how should the con-flict be resolved?

3. To what extent can (and should) Ex-ecutive Orders be used to establishpriorities among national goals?

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4 IS there a mechanism for ensuring thatnational energy goals are compatiblewith State and local plans in energyand in other program areas?

Background

The Energy Plan represents a major step inthe direction of improved planning forenergy conservation and use. Questions willarise, however, as to how the goals of thePlan are to be made compatible with othergoals such as those for transportation, en-vironmental protection, water conservation,land use, and housing.

The coordination of Federal programswith respect to particular policy goals is awell-known problem. The Plan—for under-standable reasons-does not identify andassess the dozens of Federal programs thataffect energy supply, conservation, and con-version. Although the significance of anysingle case cannot be evaluated without ex-tensive review, examples of possible incon-s i s t e n c i e s i n c l u d e : home mortgageprograms that give preference to single-family housing; antitrust policies that mayjeopardize the proposed petroleum com-pany financial data system if the informa-tion sharing is interpreted as affecting com-petition; and the extensive investment ofFederal agencies in energy-consumptive, in-tercity employee travel.

Two problems arise: (1) how to identifyinconsistencies, and (2) how to resolve anyinconsistencies that are identified. Neither iseasily settled, and the Plan should not bedelayed as a result. However, effectivemanagement of the Plan will require an earlystart on the process.

In addition to close interagency coor-dination, possible alternatives for identify-ing incompatible programs include requiringan energy-impact section in all environmen-tal impact assessments and requiring, on aone-time basis, a broad-brush energy im-pact assessment of each program for whichFederal funding is sought.

Possible options for resolving inconsist-encies ‘ include (1) Presidential ExecutiveOrder, (2) interagency coordination, and (3)congressional action. Because many of thesedecis ions wi l l amount to establ ish ingpriorities among national goals, it is impor-tant that resolution strategies be consideredas soon as possible, so that future action isnot unduly delayed.

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SocietalImpacts

Issue 17

Adequacyof the Plan’sOil ImportGoals

Will the Plan’s oil import goals sig-nificantly reduce the danger of an oilshortage in the mid-1980’s and thevulnerability of the United States toanother oil embargo?

Summary

One major concern that motivated theplan was a fear that world oil exportingcountries would not be willing or able toproduce as much oil as the importing coun-tries would want to import (at the presentreal price) by the mid-1980’s. The Plan alsois designed to respond to the danger ofanother politically motivated embargo.

The PIan proposes to hold oil imports in1985 to between 6 million and 7 millionbarrels a day, about 4.5 million below theestimated amount that would be importedwithout changes in U.S. energy policy. Ifthat import goal is met and if the strategicoil reserve is developed on schedule, theability of OPEC to impose another embargoor further steep price increases should besharply limited.

Questions

1. Is a reduction of 4.5 million barrels aday sufficient to avoid a strain on pro-duction capacity and a consequentsharp rise in oil prices?

2. Could the United States adjust to anylikely oil embargo without unaccepta-ble economic strain?

Background

The most pessimistic published forecastof future world energy demand estimatesthat by 1985 the members of OPEC willhave to export between 43 million and 47million barrels of oil daily to meet demandin the oil-importing countries. World de-mand, under that circumstance, could onlybe met if Saudi Arabia produced between19 million and 23 million barrels a day.

Saudi Arabia may not be either able orwilling to expand its capacity to that level,more than twice its 1976 production. Thereare a number of reasons for adopting a moreoptimistic view of world oil supply and de-mand. For example, the Organization forEconomic Cooperation and Development(OECD) projects world oil import require-ments in 1985 (OECD reference case) atabout 35 million barrels a day, some 8million to 12 million barrels below the mostpessimistic case. Under the OECD assump-tion, Saudi Arabian production could be aslow as 7 million barrels a day with a max-imum of 15 million barrels.

The embargo problem is somewhatdifferent. The key questions involve thedepth and duration of any curtailment offoreign oil supplies. The Arab embargo andsupply restrictions of 1973-74 did not, infact, cut very deep; at its worst point, onlyabout 3.4 mi l l ion barrels a day wereremoved from the world market. Also, theembargo lasted only about 5 months.

For purposes of this analysis, it will beassumed that any future embargo would cutArab oil exports by half. It will further beassumed that by 1985, those countries will

be supplying two-thirds of the total oil im-port market. Cutting their exports in halfwouId therefore reduce o i I i reportava i lab i l i t ie s by one- th i rd . Impor t s ,however, will represent only about two-thirds of total oil requirements of the in-dustrialized countries in 1985, so the cut intotal oil supplies would be roughly 20 per-cent. If the International Energy Agency

(IEA) emergency plan were to spread thiscut evenly among industrial countries, theUnited States would lose about 4 millionbarrels a day in total oil supplies, and couldadjust to that loss even over a prolongedperiod,

A somewhat more difficult problemwould arise if the IEA plan were not put intoeffect and if Arab producers simply cut offall oil exports to the United States. In 1976,nearly half of U.S. oil imports came fromArab countries, By 1985, dependence on

Arab imports could exceed 60 percent.Without the Plan, this would mean a reduc-tion of U.S. oil supplies of about 7 millionbarrels a day, or nearly one-third of totalconsumption. If the Plan’s import goalswere achieved, the United States wouldlose about 4 million barrels a day, or about22 percent of supply.

It appears unlikely, even without the IEAplan, that the Arabs could prevent any oftheir oil from reaching the United States.Even if they did, the United States could ad-just for some time to a loss of 4 million bar-rels a day. The emergency oil reserve of abillion barrels called for in the Plan wouldprovide half of that amount for a year and ahalf. The other half could be made up by ad-ditional conservation measures. The situa-tion would be much more serious if the losswere 7 million barrels a day. In that event,either the emergency oil reserve would bedrawn down much more rap id ly , o rrelatively drastic measures would be takento cut oil consumption.

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Issue 18

The Questionof Growth

The National Energy Plan assumesthat economic growth can andshould continue indefinitely anddoes not discuss the desirability oreven the possibility of achieving suchgrowth in a wor ld wi th f in i teresources.

Summary

The National Energy Plan presents a long-run objective of sustained economic growthwithout questioning the appropriateness ofthis objective. It is widely recognized thatgrowth of the gross national product (GNP)is not an adequate measure of social well-being, part icular ly when GNP wouldmeasure wasted and valuable energyresources but would not reflect savings inenergy. Furthermore, continued growth ofGNP may not be necessary to achieve basicsocial objectives; for example, it may bepossible to maintain high levels of employ-ment while reducing the rates of growth ofGNP and of energy consumption bysubstituting labor for energy. Such a shift inthe structure of the economy, and the long-term changes in capital stock that would berequired, are not addressed in the Plan.

In any case, resource availability and ulti-mate environmental constraints may makesustained economic growth unattainable.

Questions

1.

2.

3.

4.

Is per capita GNP a sat is factorymeasure of national economic wellbeing? is a more than 4-percent annualgrowth in GNP necessary to achievesocial goals?

What changes in capital, technology,and population distribution will benecessary to sustain agriculture as oiland gas become more scarce?

Will future energy sources and deliverysystems require decentralization of thestructural and spatial patterns of oursociety?

Will extensive additional sources offuture energy like nuclear fusion bewisely used to increase human well-

being? Can and should these sourcesbe applied to indefinite growth?

Background

The National Energy Plan encouragesconservation and solar energy develop-ment, and plans to replace energy-wastefulcapital stocks, both of which actions areneeded over the long term. While the planis significantly more farsighted than existingenergy policies, it still does not fully reflectthe long-term problem.

The president’s Plan is based on thepremise that economic growth, measuredby the gross national product, can andshould continue. It is generally accepted(even among economists) that humanbenefit does not derive from annual-averagerates of flow (GNP) but from the stock,quality, and distribution of the goods availa-ble to the population and from other in-tangible but important values such as accessto cultural amenities or to wilderness.Furthermore, there is wide agreement now

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that recent growth in GNP to a large extenthas in fact been growth in resource-wastingactivities. If waste is to be reduced andhuman well-being increased, it wil l benecessary to abandon the practice of equat-ing “progress” with “economic growth” or“growth in GNP, ” and to develop more ade-quate indicators.

The extent to which a 4.2-percent annualgrowth figure for GNP, which the Plan con-templates, is designed to provide “full”employment does underscore the need forsociety to alleviate unemployment. But itassumes that there are no other ways toachieve employment goals. Substitution oflabor for capital and energy, shortening theworkweek, and lowering artificial barriers toentry in the labor market are among availa-ble approaches.

In the long run, the United States canadapt to an economy which uses lessenergy with greater employment and higherincome levels. Some European countriessuch as Sweden and West Germany haveliving standards equivalent to or higher thanthe United States but use less energy.Capital and energy have displaced labor inU.S. manufacturing in the past, and energy-intensive goals have been substituted forlabor-intensive goals and services. Labor in-tensity in the future will differ from labor in-tensity in the past. However, future growthis likely in activities which employ morelabor and have fewer requirements for oiland natural gas. In the long run there will begrowth in rail transportation, urban housing,solar power, and energy-saving tech-nologies and appliances. There will also begrowth in agricultural and forestry fibers andmaterials, coal production, and towns and

cit ies i n regions w i th these natu ra lresources. Each of these activities wouldemploy more persons and use less energythan the activities they would displace.

A long-term deficiency in the Plan isassociated with the need it acknowledgesfor replacing energy-wasteful capital stocks.The Plan suggests ways to begin changingsome of the capital stocks, but focuses onones that can be changed relatively quickly(e.g., boilers, engines, buildings, etc.) whileignoring several that can be changed onlyover much longer periods and that wasteeven more energy.

Agricultural capital is a case in point. Thenational energy policy of the last severaldecades has been to replace human labor asrapidly as possible with petroleum energy,and no sector has applied this policy withmore vigor than has agriculture. Machinesand chemicals used in agriculture now con-sume 5 or more calories of oil and gas forevery calorie of grain produced. Additionalhuman labor will be required to reduce theenergy intensiveness of AmericanagricuIture.

Even if continued economic growth weredes i rab le i t m ight not be poss ib le .Prolonged growth will require increasedcombustion of fossil fuels in the next fewdecades and new sources of energy fromthermonuclear fusion or solar power in thenext century. Expansion of the processes we

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generally associate with growth may belimited by the availability of other resourcesand may not be perceived as desirable froma social or environmental point of view.Two specific problems involve the uncer-tain impacts of introducing additionalvolumes of carbon dioxide into the at-mosphere through increased combustion offossil fuels, and the consequences of wasteheat generation. While the Plan proposes astudy of the carbon dioxide problem, thequestion of waste heat is not addressed atall.

Issue 19

The PopulationFactor andEnergy Planning

Continued population growth, in-cluding natural increase and im-migration, makes the goals of the Na-tional Energy Plan harder to attain. Inthe long run, no plan to curb thegrowth in energy demand can suc-ceed without a parallel policy to curbpopulation growth.

Summary

U.S. energy demand is the product ofpopulation size and per capita consump-tion. Thus population growth, of which im-migration is an important component, is afactor that must be considered in thedevelopment of an energy plan.

The slowdown in the U.S. fertility rate hasalready had a marked effect on projectedenergy demand. This trend, however, isbeing partly offset by an increasing growthin the rate of immigration, including illegalimmigrants, which affects both energy de-mand and unemployment.

Questions

1. What is the optimum population levelfor the United States, both as to thenumber of people who can be sup-por ted, g iven avaiIable energyresources, and maintenance of an ac-ceptable quality of life? If it is desira-ble to stabilize population growth atsuch a level , what pol ic ies andprograms would best achieve this?u

2. What effect will an influx of illegalaliens have upon the achievement ofenergy plan goals?

Background

There is a widespread, but erroneous,belief that the United States has solved itspopulation problem. The source of this in-correct impression is as follows: the present(momentary) birth rate in the United Statesis at replacement level, which in about 50years would produce zero populationgrowth (ZPC), leveling off at about 270mi l l ion (compared w i th today’ s 217million).

population growth, however, proceeds ata faster pace than these statistics imply. Infact, the U.S. population is now growing atabout 1.2 percent per year, and if this ratecontinues, the population will double in 58years. There are two reasons for this.

First, there is a bulge in the compositionof the population in the younger, more fer-tile years. Even at the replacement rate—one child born for each adult—an increasein population results because parents re-main alive for many years after children areborn.

The second factor is immigration. Esti-mates indicate that immigration produces ayearly population increase at least equal tothe rate of natural increase of U.S. citizens,and the rate of immigration seems to be in-creasing.

Of particular concern is illegal immigra-tion. By present estimates there are 6 millionto 8 mill ion i l legal aliens in the UnitedStates, with as many as 1.2 million new il-legal aliens arriving yearly. If current ratescontinue, immigration will add 38 millionpersons to the U.S. population by the year2000, of whom at least 25 million will be il-legal aliens.

It has been estimated that illegal aliensalready living in the United States consumemore than 1 million barrels of oil equivalentper day, between 2 and 3 percent of totalU.S. energy demand. This and other aspectsof the immutable relationship betweenpopulation and energy demands suggestthat U.S. population policies merit carefulstudy and debate as an integral part of anyfuture U.S. energy planning.

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Issue 20

Impact of aPetroleum-ScarceFuture on theAutomobile Industry

The National Energy Plan does notaddress itself to the need for an ac-celerated search for a substitute foroil, the energy resource that is likelyto be exhausted first.

Summary

By the end of the century, the fleet ofautomobiles and trucks in the United Statescould total 200 million. Unless adequateliquid fuels are in good supply by that time,the alternatives might well be limited tosimply abandoning large parts of that fleetor trying to convert cars to electricity. Theloss of mobility that would occur withprolonged sharp reductions in liquid fuelsupplies and an enforced shutdown of theU.S. automobile industry and its relatedbusinesses would have unprecedented im-pacts on the U.S. economy.

Questions

1,

2.

3.

Should alternative fluid-fuel sourcessuch as alcohols and hydrogen begiven higher research and develop-ment priorities?

How can a full range of transportationservices be maintained without fluidfuels?

Has the possibility that U.S. transporta-tion could be immobilized by highcosts or scarcity of petroleum within20 years been squarely addressed byindustry or the executive branch?

4. What Federal agency has been chargedwith looking at the long-range implica-tions of and alternatives to our presentlarge petroleum-based transportationfleet? Will this become a function ofthe Department of Energy?

Background

Oil and gas are now burned in applica-tions where coal is available as a substitute.in other appl icat ions, part icular ly int ransportat ion, f lu id fuels cannot bereplaced on a large scale either by coal or byelectricity. There is no evidence to suggestthat coal liquefaction can provide enoughliquid fuel to provide power for more than afraction of the Nation’s automobile andtruck fleet within the next 20 years.

The Plan states that “Government policyhas subsidized and protected energy-ineffi-cient . . . transportation. The interstate high-way system has encouraged automobileuse. Local highways have drawn people,businesses and industry out of central citiesinto suburbia” (NEP, p. 4). In this process,the United States has become almost totallydependent on the automobile for work,recreation, and the daily tasks of life. Con-sumers presently pay approximately one-th i rd o f the i r d i sposab le income fo rmobility, divided roughly 50-50 betweenpersonal mobility and the freight costs ofconsumer products.

As energy becomes more expensive, theUnited States will have an increasing incen-tive to shift to public transit and efficientland-use arrangements (Issue #21), This,

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however, is a slow process. In the mean-time, U.S. society and economy wouldsuffer severe disruptions if prolonged andsharp reductions in liquid fuel supplies oc-curred.

The U.S. dependence on transportationwith the vulnerability it conveys under-scores the necessity for additional emphasison development of other liquid fuel tech-nologies, including alcohol. Alcohol can beobtained by fermentation from dispersedbiomass and can be used in modern inter-nal-combustion engines.

At a minimum, the National Energy Planshould make provision for a full-scaleanalysis of the potential for disruption ofU.S. transportation as a result of rising oilcosts and dwindling oil supplies.

Issue 21

Land-UsePatterns

T h e N a t i o n a l E n e r g y P l a nacknowledges the opportunities forlong-range energy conservation thatare inherent in new land-use patternsbut offers no proposals to startachieving them.

Summary

Existing patterns of land development,particularly in suburban areas, often put toomuch distance between homes and officesor factories, between homes and shops, andbetween homes and schools. The develop-ment pattern in most areas of the UnitedStates makes suburban Americans almosttotally dependent on the automobile. It alsoinhibits installation of the kinds of districtheating systems that are common in Europe.Changes in land-use patterns could promotethe use of district heating and eventuallymake it possible to make many trips thatnow require an automobile by publictransportation or by foot. But these changesare long range and fundamental and willtake more than one generation to complete.They also will require national guidelines,leadership, and incentives. An example ofthe kind of first step that could be taken atonce is to require a long-range “energy im-pact statement” for all proposed newtransportation programs and for all new ur-ban and suburban construction that in-volves the use of Federal funds.

SocietalImpacts

Questions

1,

2.

3.

4.

What steps are being taken to plan fora more energy-efficient distribution ofpopulation and industry in the nextfew decades?

What kinds of incentives could en-courage people to accept moreenergy-efficient living and workingspatial arrangements ? How can the dis-incentives which frequently exist atpresent (e.g., lack of privacy, noise) beeliminated ?

What consideration has been given toincorporating a policy-level, land-useoff ice with in the Department ofEnergy?

What consideration has been given toc oo rd i n a t i n g the land-use andtransportation functions of the Depart-ments of Housing and Urban Develop-ment and Transportation with those ofthe Department of Energy?

Background

During the post-World War II decades ofcheap energy, industrial production wascentralized and products were shipped tostores throughout large regions and, in somecases, throughout the Nation. Cheap energypermitted a scattering of jobs, homes,schools, and shops, linked in large part bythe automobile. Ninety percent of personaltransportat ion i n t h i s c o u n t r y i s b ypassenger car and truck. Nearly 75 percentof all automobile trips cover distances ofless than 10 miles. public transportation canprovide a substitute for automobile tripsonly in cases where population densitiesand geographical relationships are such thatrelatively large numbers of people arebound for the same destination at about the

Environmental Protection Agency - Documerica Photo

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same time. These time and space relation-ships do not exist in most suburbs today.But as fuels for automobiles become scarceand costly, shoppers and workers will needother means of travel than the car.

One way to reduce dependence on thecar is to rearrange urban and suburbandevelopment so that work and home orhome and shop are more easily linked bypublic transportation or are close enoughtogether that walking or bicycle riding cansubstitute for the car. Rearranging land-usepatterns is not a short-term solution. it willtake over a generation to provide clusters ofhomes, workplaces, and parks that willreduce the need for transportation as suchand still put many amenities within reach ofthe home. But the new land-use patternsmust begin somewhere. Any long-rangeplan for energy policy should include pro-posals for beginning such a rearrangementof living and working patterns in the UnitedStates.

Department of Transportation“ Photo

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Issue 22

In Defenseof Amenities

Can cost-benefit analysis justify thesacrifice of irreplaceable nationaltreasures to meet the need for moreenergy?

Summary

If the American people believe that thereare some national treasures that must beregarded as exempt from sacrifice to meetenergy or economic goals, then the princi-ple should be explicitly recognized. In addi-tion, such national treasures should be iden-tified so that, if a crisis should occur, panicwill not lead the Nation to actions it willlater regret.

Although the National Park system was astart in this direction, it is highly selective,focusing on the most popular and obvioustypes of landscape for preservation. There isa danger that anything not already pro-tected, and perhaps a few things which are,will be destroyed as demands for energy in-crease.

Questions

1.

2.

Can Americans collectively agree thatthere are national treasures (other thanhistorical shrines) that should be savedfor posterity despite energy demandsin this generation?

Can explicit criteria be worked out,and agreed upon, for identifying na-tional treasures?

3 Can education in the broadest sense,including movies and television, con-vey a vicarious experience of thesetreasures to the majority of the peoplewho cannot have the actual ex-perience? Can such vicarious ex-perience be sufficiently keen to elicitsuppor t fo r the p rese rvat ion o ftreasures from people who will neverenjoy the direct experience ?

Background

In most hard-nosed energy analyses,there is an implied threat that what arecalled amenities may have to be sacrificedto meet national energy demands. It is im-plied that the benefits of amenities are softand cannot be quantified at a high-enoughlevel to justify retaining them in the face oflarge and easily quantifiable energy needs.This issue should be met head on.

Mount Vernon is generally accepted as anational treasure. The buildings are madelargely of wood; their value as fuel, in bar-rels of oil equivalent, could easily be calcu-lated. As other fuels increase in price willthere not finally arrive the time when the in-creasing value of Mount Vernon as anenergy source (which is objectively deter-minable) must exceed its constant value asan esthetic and historic monument (whichcannot be objectively determined)? Whenthis time arrives, do not the principles ofcost-benefit analysis dictate that MountVernon be converted into firewood?

If the answer to this question is yes, thereis no further problem: the pursuit of energybecomes clear sailing—the United Statesmust simply determine the Btu value of allartifacts, treasures or not, and then burn asneeded.

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But if the answer to this question is no,then the Nation should say so explicitly,because the answer can be, and should be,generalized. If the American people believethat there are some treasures that must beregarded as standing above energy con-siderations, then these should be explicitlyidentified in advance of either a crisis or ac-tions taken in panic.

The question of sacrificing a nationaltreasure will not, of course, first be raisedwith a historic amenity like Mount Vernon:burning this would be unthinkable. But thepossibility of sacrifice has already beenraised for natural amenities—redwoodforests, pristine valleys, and vulnerablespecies of plants and animals in danger ofextinction. Can the Nation—should the Na-tion-protect these treasures against de-mands for more energy? Should workmentear up a beautiful valley to get coal? Shoulda forest be demolished to get buildingmaterials?

The issue of replaceability is relevant. Inthe case of a landscape which is merelypretty, it is possible to restore its limitedbeauty after strip mining, if the extractiveprocedure is properly planned from the out-set. The cost of restoration added to theother costs will increase the price of fuel toconsumers, but it is generally conceded thatjustice towards succeeding generations de-mands that we bear these costs of energyextraction.

There are, however, many works ofnature that once lost cannot be restored.The minority who have ever had close con-tact with a climax hardwood forest or avirgin prairie can speak for the almost in-describable beauty of these complexsuperorganisms. Once destroyed, neitherwill be regenerated in a human lifetime: theforest is replaced by a temperate junglecalled second growth, and the prairie isfollowed by an ugly miscellany of weeds. Ifno further disturbance occurs, ecologicalsuccession may eventually restore theoriginal mixture of species, together withthe beauty; but in no case will the succes-sion be complete in less than 500 years-aperiod longer than the lifetime of most na-tions. For all practical purposes, as far as na-tional policy is concerned, destruction of abeautiful ecological community and thevital information it contains is irreversible.

Can people defend aesthetic goodsagainst utilitarian demands? Those whohave experienced the aesthetic delight ofthem are more likely to rise to their defense,but fortunately it is possible for those whohave not had the experience to join in thedefense. What percentage of the U.S.population has ever seen, or ever contem-plates seeing, Mount Vernon? It surely isless than 10 percent (25 million); yet anyproposal to cut up Mount Vernon for fire-wood would undoubtedly be rejected bythe great majority of the electorate. Themere knowledge that this historic shrine isthere is an amenity for most Americans-anamenity they will defend against the quan-titative onslaught of cost-benefit analysis ofthe conventional kind.

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