Domestic Energy Production Act Would Significantly Reduce Energy Prices

Published May 7, 2008

(May 7, 2008 – Chicago, IL) On May 1, 20 U.S. Senators introduced the Domestic Energy Production Act, which would open up portions of the Arctic National Wildlife Refuge and the Outer Continental Shelf for resource recovery, remove oil shale prohibitions, streamline refinery permitting, encourage synthetic fuel production, and encourage production of cellulosic ethanol.

The measure would free Americans from unnecessary federal burdens that have been driving up energy prices and increasing the nation’s dependence on non-domestic energy sources.

Energy and environment experts from The Heartland Institute, American Enterprise Institute, and Competitive Enterprise Institute believe the proposed legislation would significantly reduce energy prices. Their statements below can be quoted directly, or each can be contacted for additional information at the telephone numbers and email addresses provided below.

“The proposed legislation is not perfect, but it would go a long way toward reducing energy supply-demand pressures that are taking such a tremendous toll on consumers’ budgets and the economy as a whole. The American people are tired of energy costs spiraling out of control while environmental special interest groups bully politicians into rendering America’s vast energy reserves off limits.

“The United States has the most plentiful energy resources in the world, but these resources do us absolutely no good when politicians cave in to special interest groups and prohibit tapping into America’s enormous oil, natural gas, and other energy deposits. It is time for politicians to assign human welfare a sensible priority.”

James M. Taylor
Senior Fellow, The Heartland Institute
[email protected]

“Economists and policy analysts have repeatedly warned the Green movement that their campaign of strangling fossil fuel production would lead to higher energy costs, which would translate into higher transport-related food costs. They were also warned that creating a market for biofuels through subsidies and mandates would lead to land being used for fuel rather than food, with inevitable impacts on food price and availability. After 40 years it has all come to a head, and the economic naiveté of Green policies has created a genuine disaster as energy prices soar, food prices soar, and ecosystems are put under the plow for biofuels.

“The Domestic Energy Production Act seeks to remove some of the hurdles that prevent the increased supply of oil, natural gas, and coal-based liquid fuel which is needed in order to get energy prices down, and most importantly, seeks to reverse the ultimate in perverse incentives: the subsidies and biofuel mandates that are literally taking food out of the mouths of the hungry and pricing billions of people into poverty around the world. If done swiftly, the act might shorten the duration of the energy and fuel crises brought to us by economically ignorant environmental policy.”

Kenneth Green
Resident Scholar, American Enterprise Institute
[email protected]

“In 1995 Congress passed legislation to open the coastal plain of ANWR to oil and gas exploration. President Clinton vetoed the bill, and one of the reasons he gave was that because the oil wouldn’t start flowing for several years it wouldn’t do anything to reduce current (1995) high gas prices. In 2005-6, the House and Senate both passed bills to open ANWR, but couldn’t agree on the same bill. And the House passed sweeping legislation to open most of the 85 percent of federal offshore waters that are currently closed to oil and gas exploration by congressional moratorium.

“Enacting legislation this year to open ANWR and OCS areas would not do anything to raise oil production immediately. However, it would lower crude oil prices immediately. With high demand and many potential threats to production, there is a significant risk premium in oil prices. Opening up potentially huge new fields in a secure country would burst the speculative bubble.

“Unfortunately, some of the other things in the bill resurrect or continue failed policies of the past. Even a little bit of government central planning can have disastrous unintended consequences, as the current corn ethanol mandate is showing.”

Myron Ebell
Senior Fellow, Competitive Enterprise Institute
[email protected]

For further information, contact Dan Miller, publisher, The Heartland Institute, Chicago, at 312/377-4000 ext. 130, or [email protected].