June 01, 2007
More Diverse, More Domestic, More Efficient
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A Vision for America’s Energy Future
During the 1970s, two global energy crises challenged the federal government and American businesses to diversify their energy portfolios and develop new technologies to increase efficiency and promote conservation. After these crises passed, the United States enjoyed a long period of affordable energy and stable markets. However, new supply constraints and geopolitical uncertainties coupled with surging global demand have again created a challenging energy environment for U.S. consumers and businesses.
Although the U.S. economy has proven resilient in the face of higher energy costs, concerns about energy security remain a top priority for businesses, policymakers and the public. Business Roundtable members, 160 CEOs of leading U.S. companies with more than $4.5 trillion in annual revenues and more than 10 million employees, share these concerns. We recognize that domestic and worldwide energy trends not only affect consumers but also have important implications for economic growth, capital investment and U.S. competitiveness in the global economy.
Today’s energy challenges are not insurmountable, but there are no silver bullets. Long-term progress requires balanced and integrated approaches that take advantage of all promising energy improvement pathways. Despite its superficial appeal, energy independence (the elimination of energy imports) is an unrealistic goal for the foreseeable future. But there is much we can do to enhance our energy security. Policies that promote new technologies, conservation, efficiency, greater diversity of supply, lower energy intensity, and greater access to domestic and global energy resources will over time reduce the nation’s vulnerability to upheavals in global energy markets.
To develop a vision of America’s energy future, Business Roundtable conducted a unique “bottom up” process in which CEOs representing several major economic sectors developed technology roadmaps describing pathways the sector could take to improve conservation, efficiency and domestic energy production between now and 2025. These roadmaps were vetted at a brainstorming workshop attended by industry energy experts and senior executives. This process resulted in a strong consensus that the United States, using technological innovation, sound government policies and proactive voluntary efforts, must:
- Significantly enhance energy security in the transportation sector by improving the fuel efficiency of vehicles, diversifying our mix of transportation fuels, increasing access to energy resources, reducing vehicle miles traveled and promoting greater implementation of advanced technologies.
- Bring supply and demand for natural gas into better balance by expanding access to domestic natural gas sources, making timely investments in new infrastructure (e.g., pipelines and liquefied natural gas terminals) and using natural gas more efficiently.
- Maintain a viable and growing nuclear power sector, both to relieve demand pressure on fossil fuels and to reduce the U.S. greenhouse gas footprint.
- Significantly accelerate improvements in energy efficiency in our commercial, residential and industrial sectors.
- Support and fortify free markets and global energy trade and investment.
- Promote fundamental research to develop advanced technological solutions to long-term energy and environmental challenges.
How We Get There
In each of these areas, Business Roundtable developed ambitious goals for the next 20 years, which are detailed in the body of this report.
Roundtable members strongly support an aggressive national initiative to promote increased energy efficiency. We advocate a national goal of reducing energy intensity (energy consumed per unit of economic output) by at least 25 percent more than the anticipated business-asusual rate of improvement. This would mean a reduction of at least 2.2 percent per year, for an overall reduction in energy intensity of more than 40 percent by 2025. Achieving this goal will require a concerted effort to deploy energy efficiency technologies across the economy, emphasizing opportunities in multiple sectors such as:
- Improving building efficiency w Increasing the energy efficiency of appliances
- Increasing efficiencies in the transmission and distribution system
- Using more efficient motors, drives and transformers
- Expanding demand-side management in the retail power distribution sector
- Upgrading the existing gas and steam turbine fleet
- Investing in advanced coal generation technologies
- Accelerating wind and solar generation w Increasing combined heat and power units
Capturing these opportunities will require leadership and commitment by the business community, and Business Roundtable will be strongly encouraging its members to champion energy efficiency.
Business Roundtable recognizes that our energy future is increasingly linked to our environmental goals — most notably progress in reducing greenhouse gas emissions and addressing concerns about global climate change. Our proposals for improving energy efficiency, investing in alternative fuels, expanding the U.S. nuclear fleet and pursuing new technologies, such as gasification with carbon capture and sequestration potential, will not only strengthen our energy security but also contribute to reducing the U.S. carbon footprint.
Business Roundtable would like to express its appreciation to Cambridge Energy Research Associates for its review of the Business Roundtable’s policy statement on energy.
To see the full report please view the PDF.