I thank my colleague, and it's great to be here tonight. We did a press conference last week addressing some of these concerns, and it's good to follow up with a Special Order tonight. At the press conference, we really highlighted the…
I thank my colleague, and it's great to be here tonight. We did a press conference last week addressing some of these concerns, and it's good to follow up with a Special Order tonight.
At the press conference, we really highlighted the issue of when our friends on the Democratic side took over the majority, crude oil prices were at $58.31 per barrel of crude oil. And when we did the press conference of last week, the crude oil price was at $96.65, the price of a barrel of crude oil.
Our issue was that when you have no energy plan, you have, when you can't plan, you have, this is the default energy policy of this country. The price escalations, as my friend from Texas, the difference about the price escalations now is that many times when we saw the run- up of these, the costs for a barrel of crude oil in the past, it was based upon some national emergency, Katrina, pipeline disruptions, maybe a refinery fire. What's different about the price escalations today is that it's all demand related. So if you, as many of us have, have taken Economics 101 in college, maybe in an MBA program, the simple law of supply and demand. If you have high prices, and we'd say we have high crude oil prices and we're quoted today at $91 a barrel, you would think that that would then encourage people to go into the business to explore new means of recovery of crude oil so that they would bring more supply into the market so that you would lower the prices.
But the policies here in Washington not only prohibit that, but they discourage any investment, because when people bring capital to the market, they assume risk. And when you assume risk, you assume the opportunity of losing it all. And most people in the investor community and the business community, all they want to do is if they're going to assume risk, they want to try to get a return on that investment.
So last week we had close to $100 a barrel of crude oil, in California $5 a gallon of gas. Now, this is before we even talk about a global warming debate and a 50 cent per-gallon tax.
And as I said last week, so what you now have is we have European prices for liquid fuel, but we don't have European distances. I always remind my friends, those that want to, well, why shouldn't we have as high gas prices as they have in Europe? Well, that's because you can put all of Europe on the eastern seaboard. We don't have the distances that our European friends do where they can drive across their country in 2\1/2\ hours. I can't drive across my district in 2\1/2\ hours from one point to another from the far west to the far east. So that's a problem that we have in this debate.
So what we would like to see, we've already moved some energy bills on the floor. They're mostly efficiency oriented, the light bulb and the light car tires. But what we need to do is we need to focus on bringing on more supply, and that should be an energy policy.
When you have no energy policy, the energy policy of this country is $96 a barrel crude oil. That's the default energy policy of this country if you do not bring on significant amounts of increased supply.
So what kinds of supplies? All my friends here on the Republican side, one thing we have in common, although we will talk about different types of supply, is that we're all supply people. We all know that you if want to lower costs, you've got to bring more supply on board. And so that's kind of the commonality of the focus, because when you have more supply, you have lower cost. When you have lower cost, that's lower out-of-pocket cost to the individual consumer.
And the consumers are going to start complaining when they're at $3 a gallon of gas, $3.50, especially around Christmastime because they're going to be spending that extra money at the pump versus going to the store. Then you have an oversupply of toys at the store. We all know about the focus on, you know, the Christmas shopping period. High energy costs will diminish and dampen the ability of our consumers to have a good Christmas shopping season. So that affects the manufacturers of all the things that we would like to buy for our loved ones at Christmas.
So how do we address the supply concerns? And again, all of us are going to be involved with that. One thing that I've always pushed for and always encouraged us to take, look after, is an alternative fuel standard.
When the President was here for the State of the Union address he said he would sign an alternative fuel standard. An alternative fuel standard would talk about things like corn-based ethanol. It also would address stuff like
soy diesel, soybeans crushed and mixed with petroleum diesel, which is obviously the soybean portion, or the beef tallow or the reformulated cooking oil or all things that are renewable.
And then, obviously, we have coal. And now in Illinois alone and in parts all over this country, we have a 250-year supply of coal in the Illinois coal basin.
Now, coal can be used for a lot of things. Coal can be used to generate electricity. When we have this energy debate, we focus, sometimes we all lump it together, and sometimes I like to split it apart: part of it would be electricity generation; the other would be liquid fuel.
It would surprise people if they knew that 50 percent of the electricity generated in this country comes from coal. In fact, the lights in this building and the lights at the Pentagon and all the electricity that we use here in the Capitol complex we can point to not only our own power plant, which uses coal, but one right across the river that also provides electricity.
Now in this country, we're pretty much independent on electricity generation. Fifty percent coal, 20 percent hydro, 20 percent nuclear, 10 percent the other one. The concern we have is the liquid fuel debate where we are highly dependent on imported crude oil. And hence, because demand goes up, we have $96.65 a barrel crude oil.
A no energy plan is a plan to fail and a plan to increase crude oil prices. So while we're trying to work with our friends across the aisle and the leadership of this House, I mean, there's a lot of my friends who I call fossil fuel Democrats who understand the importance of fossil fuels in this country and understand the importance of making sure that we bring more supply in the fossil fuel arena to this debate. They have been tampered down by the leadership.
But we hope in this Special Order, we hope from the press conference of last week, and we hope from the anger and angst that the driving public's going to see by escalating prices, that we'll start at least start making the point of you can't always say no if you want to have an energy policy. You can't always close up supply. You've got to make sure that where you know you have available resources, you then take the opportunity to go in those arenas. Like we want to exploit the Illinois coal basin for electricity generation and for liquid fuel. We do not want to shut off areas by which we can bring in more natural gas reserves or other type of fossil fuel research.
So for my colleague from Texas, for planning to execute this Special Order, I appreciate the time that he has allotted me and want to let him know that I'm going to continue to be on the watch trying to drive home to the American public the importance and the need for a sound energy policy that, yes, talks about some efficiency issues, but as important, in fact, I think more important, talks about really bringing more supply to the debate so that we can at least maybe hold prices steady.
I'd like to see us move to start lowering prices so that the consumers of this country have more spending power, the manufacturers in this country will have that as a net plus in their competitive advantage, which is low-cost power. And I feel that the inability of the Democrat leadership of this House to move effectively on the supply end will cause great distrust, dissatisfaction, and danger for the energy security position of this country.
I want to ask my friend from Pennsylvania a couple of aspects on the chart. The first one, when we talked about the tax, under this current Congress, how many times have the Democrats gone to that same pot of money for PAYGO issues of other bills that have come to this floor?
I know there is at least three times, and I'm being told four, using this same pot of money to justify the PAYGO, the new spending that they brought on.
The other thing that we really need to have here and talk to the American public about is that the Energy Information Service, what we don't have depicted is, what is going to be the future demand? And the future demand is going to double. So with your great chart of all the portfolio there, it's kind of confusing because the public might think, well, as we look at that, that everything is going to stay pretty much the same. But the reality is demand is going to go up exponentially. And if you have the same amount of supply and the demand goes up, then you see $100 a barrel crude oil, $120 barrel crude oil. And that's why, as we have come here to talk about supply, we want to bring more supply to the table. And we know we have friends on the other side of the aisle that believe the same thing.
I'm working with Rick Boucher. And you mentioned coal-to-liquid. Just imagine this, we have 250 years' worth of coal in the only coal basin. So you have the coal underneath the ground, you build a coal mine, right on top of it you build a coal-to-liquid refinery somewhere in the Midwest or somewhere in Pennsylvania where there is a coal field, and then you connect it to pipelines that we have today. Then you limit the risk. The risk we have now is, if we're not going to build new refineries, we're going to build refineries and expand existing refineries, and we have so many down on the gulf coast, we have them in Louisiana, we have them in Corpus Christi, we have them in Houston, we have them in all these areas where they are really at risk, and we dodged a bullet this year, of major storms that take these refineries offline, depending upon the severity of the storm. So for national security sake, to have a diversified energy portfolio, John, you said it numerous times, diversification. When you have an investment portfolio, you want diversity for security.
We've got to have a diversified energy portfolio. And for our friends on the other side to say no to coal, no to oil, no to nuclear, yes to solar, yes to wind, and it's such a small portion of what can really affect the cost, it's really sending a terrible signal to our constituents that the salvation is in renewables when we all agree we want a diversified portfolio. We want to bring them on. But if you do it at the risk of the other major sources of supply, you do great harm to this country.
I mean, you bring up a good point. And I would like to focus on that for a minute. Because now you're going from 12 coal fire plants or electricity generation plants to three. And one of the reasons why the building trade and many in organized labor are in support of a new supply provision, because look at what you've done, look at all the jobs to build these plants, and then look at all the good-paying jobs to operate these plants.
I don't know what Texas plans are, but I can see them very well, governments south of the great State of Texas citing a power plant and selling power across the border into Texas. And then who gets the jobs? It's like the same, my friend from Pennsylvania, we talk about natural gas all the time; if we're not willing to have a liquefied natural gas port built inside this country, where are they going to go?
Where are they going to go? To the Bahamas. Or they are going to go to other places where when they build the port facility, they build the liquefied natural gas, and then they pipe it in to this country. Who loses the jobs? We lose the jobs. So that is one of the frustrating things of this debate.
There are two main issues. We always talk about energy security because we address it in the national security component of how do we keep our Nation safe, how do we stop from being extorted by foreign rogue countries, and how do we keep our economy from falling in disruption should there be a strike in the sea lanes.
But there is also another security debate that we have talked about, and that is financial security, financial security for this country, and what really strikes individual families is financial security for the families. When you have these types of price escalations, when you don't bring new major supply to the economy and you put all your promises on a small portion of renewables that won't even meet the future demand increase, then what you are doing is, you are going back to $96 a barrel of crude oil. And that is the no energy plan that we are talking about. And all we are saying to our friends, and again, I have many of them. I work with them on the committee all the time. My fossil fuel Democrats, now is the time to make sure that fossil fuel
is a huge, is a part of this debate. And my friend from Pennsylvania is right. We are not saying it has to be the whole thing. We are all comers here. I have got my corn here. I have got my soybeans. I have my coal. I have got marginal oil wells in southern Illinois, marginal oil that we can use and recover, and we are still recovering oil from southern Illinois. Bring on the wind, bring on the solar, but we want to bring everything in. The more supply we have, the lower the cost, the Nation will be better off
I know that the public, sometimes they don't understand that carbon dioxide is a commodity that is bought and sold, that people want, and we want it in the soda business to give the fizz in your Coke or your Pepsi, or as my friend from Texas knows, advanced oil recovery. You shove that CO2 back in the ground, it helps recover that margin of oil that has been harder to recover in the past.