In May of 2007, I wrote Why are gas prices high, and what can we do about it? At the time, the national average price for a gallon of regular unleaded gasoline was $3.22.
The national average price is now 59 cents higher, at $3.81 per gallon. That’s down 30 cents from a high of $4.11 in early July.
In June of 2007, here’s what I wrote.
Q: So what can the government do about [high gas prices]?
A: In the short run, almost nothing. In the long run, the President has proposed to:
- lower demand by increasing fuel economy standards (“CAFE”), and also to reform the way those standards are measured, to encourage sound science, safety, and keep costs low
- increase our domestic oil supply by drilling for more oil, both in the Gulf of Mexico and off the Alaskan and Virginia coasts (these are already underway), and in Alaska (we need Congress to change the law)
- increase our supply of alternative fuels by expanding something called the Renewable Fuel Standard, mandating that more of our fuel come from ethanol (from corn and, eventually, other plant sources), and expanding it to include other alternatives like electric vehicles, plug-in hybrids, and coal-to-liquids
- increase our insurance policy by doubling the size of the Strategic Petroleum Reserve. The SPR is a few big holes in the ground where the nation stores oil, just in case there’s a severe supply disruption
- and, most importantly, encourage the development of new technologies on both the supply side and the demand side. The President has proposed increased federal R&D funding for cellulosic ethanol, batteries and plug-in hybrid vehicles, and even a “Hydrogen Fuel Initiative”in the long run.
#1, #3, and #4 are the President’s new “20 in 10” proposal that he rolled out in the State of the Union address this year. Together, they would reduce our gasoline usage by up to 20% within 10 years (by 2017). If you want to learn more about our “20 in 10” energy proposal, you can find a good description here.
The solutions take years to have a big effect. We’re urging the Congress to take those long-term actions now. It’s taken years to get to this point, and it’s going to take us years to work our way out of it. But that’s no excuse for not starting now.
What has happened since June of 2007?
- The higher fuel economy standards (#1) are now law. The President signed them into law in December of 2007.
- The expanded Renewable Fuel Standard (#3) is also now law. It was enacted in the same December 2007 bill.
- Congress has increased federal R&D funding for cellulosic ethanol, batteries, and hybrid vehicles (#5).
The two things the Congress has not done are:
- increase our domestic oil supply;
- increase our insurance policy by doubling the size of the Strategic Petroleum Reserve. In fact, they have moved in the opposite direction, by stopping the fill of the SPR.
On June 18th of this year the President proposed that Congress take four steps to expand American oil and gasoline production:
- Lift the legislative bans to drilling on the Outer Continental Shelf, off our coasts.
- Lift a legislative ban preventing firms from developing onshore oil shale resources.
- Lift a legislative ban preventing environmentally responsible drilling in 2000 acres of the Alaska National Wildlife Reserve (less than .01% of the ANWR area).
- Create an expedited process for resolving legal disputes around energy projects, and establish the Secretary of Energy as a “Federal Coordinator” with authority to establish deadlines and ensure the timely review of Federal, state and local permits needed to undertake refinery projects.
We released a policy memorandum at the time that described in more detail each of these four steps.
At the time, the President offered to lift an Executive Branch prohibition on drilling in the Outer Continental Shelf when Congress acted on #1. A month later, Congress still had not acted, so the President lifted the Executive Branch prohibition.
It’s now August recess for Congress, and they still have not acted. Some House Republicans have remained in Washington, however, and are protesting Congressional inaction by giving speeches on the House floor even though Speaker Pelosi has turned off the CSPAN cameras and the microphones. They’re bringing in constituents and tourists and speaking to them about the need for increased domestic energy production.
This past Tuesday, the President again called on Congress to lift the legislative ban on drilling on the Outer Continental Shelf:
Members have now had an opportunity to hear from their constituents, and if they listen carefully I think they’ll hear what I heard today, and that is a lot of Americans from all walks of life wonder why we can’t come together and get legislation necessary to end the ban on offshore drilling. And so today I join House Republicans in urging the Speaker of the House to schedule a vote on offshore oil exploration as soon as possible.
Now, the way ahead is this: The moratorium on offshore drilling is included in the provisions of the Interior appropriations bill. When Congress returns, they should immediately bring this bill to the House floor and schedule an up or down vote on whether to lift the moratorium on offshore drilling. Our goal should be to enact a law that reflects the will of the overwhelming majority of Americans who want to open up oil resources on the Outer Continental Shelf.