Closing Keynote Speech by The Honorable C.H. "Bud" Albright, Under Secretary, U.S. Department of Energy

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I am happy to be here today participating in the discussion you have been having that tackles Three Grand Challenges of our Nation's energy use and the role that the electricity sector will have in this effort.  The growth and security demands of the 21st century are pushing our 20th century infrastructure, itself built on 19th century technology, to its limits.  To meet our demands, we must pursue new ways of generating and distributing our electricity, and do so as efficiently and responsibly as possible.

Energy is a critical component to nearly every public policy issue that will be decided over the next several years.  While the United States certainly faces a number of energy challenges, I am optimistic that America's ability to overcome our challenges will lead the world to a new, safe and reliable energy future.  We face an explosion in global demand for energy.  Over the next 25 years, the Department estimates that global energy consumption will increase by an additional 50 percent, with 70 percent of that growth coming from the world's emerging economies. 

Domestically, our own demand for electricity will almost double in the next 20 years.  Our production and distribution challenges are daunting enough alone, but now we face the challenge of also reducing greenhouse gas emissions.

When you put these together, it is obvious that we need to do something.  However, there is no silver bullet to overcome these issues; our solutions must be multi-faceted.  In the midst of all these energy challenges, I am very optimistic about our future, for two reasons.  First, throughout history, technology has never let us down.  We have always developed new technologies to address our greatest needs.  My confidence in what technology can do for us in the future stems from what it has done for us in the past.  From the invention of the printing press, to the light bulb, to the jet engine, to the internet, and the development of nuclear power, technology is always changing the way we approach problems.  I am confident that technology will again make it possible to address our energy needs in this new century. 

Secondly, I am optimistic about our future because President Bush has made technology development a key priority. Since 2001, the U.S. has spent $37 billion on clean energy technology and climate change science - more than any other country in the world.  At DOE, the President's Advanced Energy Initiative, launched in 2006, is providing significant increases in funding for clean energy technology research.  Through this effort, we are examining new ways to fuel our cars, homes, businesses and power plants– through avenues such as advanced hybrid vehicle technologies, hydrogen fuel cells, solar and wind energy, and cleaner coal technology.

The Administration is also supporting the creation of advanced technology through the President's American Competitiveness Initiative - an unprecedented increase in federal support for basic science research, particularly in the physical sciences.  Advancing basic and applied research will give us the energy technology we need and will ensure that the United States is on the right path toward greater energy security.  

As we move forward and look at ways to further develop our energy infrastructure and increase our energy supply, we do so knowing the important role that this technology investment will play. However, while we are working to improve the new technologies of tomorrow we cannot ignore the technology that already exists and that can make an immediate impact today.  That is why the Administration is committed to better utilizing the Nation's existing energy resources and improving our infrastructure.  Nowhere is that commitment more evident than in the U.S. electricity sector.

As all of you are well aware, concerns about carbon dioxide emissions are causing us to make large investments in generation capacity with reduced carbon dioxide emissions.  In altering our electricity infrastructure to reduce carbon dioxide emissions, we must ensure that we are not causing substantially higher electricity prices.  High prices can hinder the economic growth needed to fund both the R&D and capital necessary to improve electricity generation.  With these constraints in place, where do we go from here, and how do we get there? 

There is general agreement that the easiest and least expensive source of energy we have is that which we gain through increased energy efficiency.  About a year and a half ago, Secretary Bodman spoke at your summer meeting and applauded the new National Action Plan for Energy Efficiency that utilities, state regulators, NARUC and others had just published.  Today, I am pleased to note that the Action Plan has indeed led to real action in many States – new dockets on energy efficiency have been opened, new State legislation is being considered, and new State energy plans have been issued with strong energy efficiency components. 

This is a great start, but we must do more.  Accordingly, the Department is working to accelerate the rollout of a "smart grid" technology that will include meters to enable consumers to be more responsive to the real costs of producing electricity.  Some States are already supporting increased utility investment in smart meters.  I know that NARUC and FERC have recently announced their Smart Grid Collaborative dialogue -I commend you for doing so. 

Additionally, we at DOE are particularly aware of congestion in the bulk transmission grid, and the obstacles you face in constructing new transmission lines.  The fact of the matter is that the best renewable and alternative resources of electricity are often found in remote areas.  Therefore, any major expansion of renewable generation capacity in these areas must be paired with a substantial expansion of transmission capacity and potentially energy storage to bring the power to load centers.  

However even with greater emphasis on energy efficiency, "smart grid" programs, and the construction of renewable generation and new transmission, the Nation will still need additional new baseload capacity using resources available to us today.  This leads me to a subject about which I feel quite strongly:  the future of coal in this country.  As you know, we have immense coal resources – a 250 year domestic supply.  From the standpoint of energy security, it is in our best interest to continue to rely on coal to help satisfy our electricity needs.  For the long term, the United States must be able to take advantage of these vast reserves in an environmentally responsible manner.  And in the medium term, we must acknowledge that coal generation is the best means to provide adequate, reliable, and affordable electricity to consumers.  Meeting this challenge will be difficult if the current trend toward cancelling coal-powered generation projects continues.

It was with this in mind that the Department recently made the difficult, yet necessary, decision to restructure the FutureGen project.  This move was made to accelerate the commercialization of carbon capture and storage technologies in clear recognition of the need for new coal-fired capacity in this country. The restructured approach builds on the Administration's investment of more than $2.5 billion in clean coal technology since 2001.  This approach seeks to demonstrate cutting-edge CCS technology at multiple commercial-scale clean coal power plants, instead of a single research-oriented facility envisioned under the old FutureGen concept.  Deploying several commercially viable technologies immediately is a more responsible use of taxpayer dollars and a better investment for the Nation.

President Bush has been committed to advancing clean coal technology since the early days of this Administration – as demonstrated in the National Energy Policy in 2001.  This year the President's budget calls for a 25 percent increase in DOE's clean coal program, to nearly $650 million.  This is the largest amount requested for DOE's coal program in 25 years and is focused on further advancing critical technologies like CCS. 

Since we are talking about the need for new baseload capacity, I cannot discuss coal without also discussing nuclear energy.  Over the last half century, the United States has done a great job of developing nuclear technology – and a lousy job of deploying it.  As you probably know, a nuclear power plant has not been ordered in the United States in nearly thirty years.  This must change.  We are working to see that it will by, among other things, implementing federal risk insurance and loan guarantees to try to remove some of the roadblocks associated with getting the next generation of nuclear plants online.

Certainly, nuclear power has its challenges.  Most notably, waste.  But there are safe, workable and proven solutions to those challenges.  We only lack the will to pursue them.  We are allowing the past challenges of nuclear energy to prevent us from reaping its great benefits for today and tomorrow.  We can no longer afford this shortsighted view.  Nuclear energy is the only mature technology that can supply the large amounts of emissions-free power needed to meet our world's growing energy demands.  And nuclear waste is an issue that is being addressed.  We must remove the barriers that are preventing Yucca Mountain from opening.  We must also continue to develop groundbreaking technologies that will help us close the fuel cycle and recycle the valuable components that exist in spent fuel. 

Since day one, this Administration has been committed to promoting nuclear energy and reducing the barriers that have prevented the construction of new nuclear power plants.  And already, we are seeing results: a number of companies have submitted licenses for nuclear plant construction to the Nuclear Regulatory Commission.  And 17 companies have signaled plans to build as many as 31 reactors in the years to come.  This is a great start, but much work remains if we hope to bring on line the 40-50 new reactors by 2030 that will be needed just to maintain nuclear energy's 20% share of U.S. electricity generation.

But wherever the Nation's electricity comes from, be it nuclear or coal or renewable energy resources, the electricity sector itself is crucial to sustaining our energy security and powering our continued economic growth.  Your efforts to ensure that security and that growth are sincerely appreciated.

I would like to leave you with this final thought:  Despite our energy challenges, we should not apologize for using energy.  Too often, we allow questions about energy supply, energy demand and energy conservation to cloud our view of the big picture.  We begin to think that energy itself is bad.  However, the fact is – energy use is both good, and vital to our economic growth and security.  In developing countries, energy usage means that new jobs, new homes, and new opportunities are being created.  Ask people in an underdeveloped country if they would rather wash clothes in a river, or have the electricity for a washing machine!  It is the use of energy that powers our economy and ensures the Nation remains productive.  At the same time, we must recognize that our energy must come from somewhere.  Nevertheless, using current resources and development of new sources, new science and new technology, we will ensure that our Nation and our world has the energy it needs – both for now, and in the decades to come.

Thank you.