August 8, 2005

Bush says new energy bill vital to U.S. economy

By Patricia Wilson

ALBUQUERQUE, N.M. (Reuters) - As oil and gasoline prices
hit new records, President Bush on Monday signed an energy bill
he called vital to the U.S. economy but conceded that it
offered consumers no short-term relief at the pump.

The $14.5 billion legislation, passed by Congress after a
four-year battle, boosts oil, natural gas and electricity
supplies and promotes alternative energy sources. Bush said it
was "a critical first step."

"We're not going to solve our energy challenges overnight,"
he said. "Most of the serious problems, such as high gasoline
costs and rising dependence on foreign oil, have developed over
decades. It's going to take years of focused effort to
alleviate those problems."

The price of a barrel of crude oil reached a high of more
than $63 on Monday and the national average price of a gallon
of gasoline rose to a record $2.37. The United States relies on
foreign oil to meet 60 percent of its daily demand of almost 21
million barrels. Gasoline use accounts for 2 out of every 5
barrels consumed.

"This economy of ours has been through a lot and that's why
it's important to get this energy bill done to help us continue
to grow," Bush said. "What this energy bill is going to do,
it's going to help keep momentum in the right direction."

Before his speech, Bush emphasized the environmentally
friendly aspects of the legislation by touring Sandia National
Laboratory's National Solar Thermal Test Facility.

Wearing stylish sunglasses in the bright sunshine, he and
Republican Sen. Pete Domenici of New Mexico were led through an
array of giant solar dishes with computer controlled mirrors
that reflect and concentrate sunlight.


Each parabolic dish can produce 25 kilowatts of electrical
power, enough to power about 10 homes.

Supporters of the energy bill say it will revive America's
nuclear power industry, boost oil drilling, convert coal into a
cleaner-burning fuel and use home-grown, corn-based ethanol to
stretch gasoline supplies.

But environmental groups and some Democrats criticize its
extensive tax breaks, subsidies and loan guarantees as a lavish
gift to energy companies already enjoying near-record profits.

"Big energy lobbyists may be cheering the bill's enactment,
but ordinary Americans had better hold fast to their wallets,"
said Anna Aurilio, legislative director of U.S. Public Interest
Research Group. "As gasoline prices careen out of control, the
bill keeps America speeding down the wrong road toward more oil
consumption, more drilling and more pollution."

Most Americans will feel the impact of new law in 2007 when
daylight-saving time is extended by one month to save energy.

Consumers will also be able to claim tax credits for
installing more energy-efficient windows and solar panels on
their homes and purchasing hybrid fueled vehicles.

The new law will not curb oil imports with stricter fuel
mileage requirements for gas-guzzling SUVs and other vehicles.

When Congress returns from its summer break in September,
lawmakers will turn to implementing the next -- and most
controversial -- phase of Bush's national energy plan --
allowing oil drilling in Alaska's Arctic National Wildlife

Bush's Republican allies in Congress plan to add ANWR
drilling language to legislation that funds the day-to-day
working of the federal government.

If Congress approves drilling in the Arctic refuge this
year, the first oil would not begin flowing until 2015 and
reach a peak output of almost 1 million barrels a day, assuming
the government leased the first exploration tracts in 2007,
according to the Energy Department.

(Additional reporting by Steve Holland and Tom Doggett)