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To fellow governors, Pawlenty was step ahead of energy crisis

  • Article by: KEVIN DIAZ
  • Star Tribune
  • July 13, 2008 - 8:26 PM

PHILADELPHIA - The price of oil has doubled since Gov. Tim Pawlenty became chairman of the National Governors Association a year ago and made energy his signature policy issue.

With Americans now reeling from $4-a-gallon gas, his fellow governors said Sunday that it turned out to be a pretty good pick, particularly in the run-up to an election in which the Minnesota Republican is often mentioned as a presidential running mate to Sen. John McCain of Arizona.

"He had great foresight to focus on this," said Pennsylvania Gov. Ed Rendell, a Democrat who will take over the association's gavel from Pawlenty today. "He was ahead of the curve."

As the governors hunkered down to tackle energy policy at their four-day annual meeting, Pawlenty acknowledged the prescience of his choice.

"In Minnesota we try to be modest. But at the risk of being a little immodest, I think we saw it coming," he said. "We're fortunate that we picked a topic that became explosively relevant to the national debate."

As host of the meeting, Pawlenty has tried forge an all-of-the-above consensus on energy policy, emphasizing the importance of conservation and alternative energy sources such as wind, solar and ethanol, an important Minnesota industry.

But Pawlenty's laundry list also includes a fresh look at the touchy subject of nuclear power -- the growth of which has been restricted in Minnesota -- and more offshore oil drilling, which has been met with skepticism among Democrats in Congress.

He also is likely to anger environmentalists by suggesting that the federal government reconsider opening Alaska's Arctic National Wildlife Refuge (ANWR) to oil exploration, though his support is contingent on developing technologies that can do it safely.

Among Democrats in the consensus-driven Governors Association, there is no dispute that the nation needs bold answers to its growing energy problems. But the oil-drilling agenda popular with Republicans governors and lawmakers has emerged as a major sticking point in the development of a national energy policy.

"No matter what we do, I don't think the supply on this planet will meet the demand, unless we reduce the demand," said Rendell, who is considered a possible running mate to Sen. Barack Obama of Illinois.

To critics who say that new offshore oil leases and nuclear power sound like a departure from Pawlenty's year-old Clean Energy Future initiative, the governor says: "We need it all."

Recent polls show increasing public support for both conservation and new energy development, and Pawlenty and other GOP governors say that traditional fossil fuels will continue to be indispensable.

"From day one, we never said we're never going to use another drop of traditional fuel," Pawlenty said. "We said we're going to have to transition as boldly and quickly as possible to new energy sources and supplies."

Addressing the governors, Robert Malone, president and chairman of the energy giant BP America Inc., said the writing has been on the wall since at least the 1970s, during the energy crisis brought on by the Arab oil embargo.

In the view of many at the governors' meeting, including Pawlenty, the nation has gone backward, enjoying decades of relatively cheap and plentiful oil supplies. "It's like the country went back to sleep after the last energy crisis," he said.

Malone noted that renewable fuel production has increased by 10 percent in the past two decades, while consumption in the United States has grown 30 percent. "Prices are at record levels because the cushion has been squeezed between supply and demand," he said.

While BP and other oil companies are investing in alternatives such as ethanol, Malone pressed hard at the meeting for more oil exploration in offshore areas now off-limits.

Democrats, including Maine Gov. John Baldacci, questioned why oil companies don't exhaust millions of acres of offshore leases that are already open to them.

A more popular Democratic proposal is to restrict oil market speculation, which some blame for surging gasoline prices.

Malone called such regulation "a very dangerous place to go."

Despite their partisan differences, the meeting's participants seemed to rally around the sense that the cost of energy production -- along with the problem of greenhouse gases that goes with it -- has captured enough of the public's attention to provide a groundswell for action.

"It's only a question of pace and scale," said Andy Karsner, assistant secretary for energy efficiency and renewable energy in the Bush administration. "Everyone agrees that the trajectory has got to move upward in an historic and unprecedented way."

But it is far from certain that the new momentum is enough to break the partisan gridlock in Washington, where leaders of both parties seem resigned to wait for a new administration in the White House -- one possibly including a former governor as a vice president.

Meanwhile, the governors were mostly unified in their demand that Congress extend renewable-energy tax credits that are scheduled to expire this year.

They are also banking on automotive technology improvements -- plug-in electric, hybrid, flex-fuel cars -- that promise dramatic fuel efficiency improvements in the foreseeable future.

"We have a huge opportunity, and I'm optimistic there will be a breakthrough," Pawlenty said. "You can see it starting to come now. ... If there's a silver lining in an otherwise awful situation, once inspired our country is very good at innovation."

Kevin Diaz •202-408-2753

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