what virtually every other industrialized nation in the world does, except ours. In Britain, in the industrialized nations of Europe, utilities burn higher sulfur coal than we are permitted to burn in this country. They say that they cannot yet take the sulfur out of stack gases. They are working on ways to do that, but until they are successful, they will permit utilities and other industries to utilize the higher sulfur coal. The condition is that those users build a tall stack, 400 or 500 feet tall, and emit the effluent gases at approximately 80 miles an hour. The sulfur dioxide comes back to the earth eventually, but when it does, it is so diluted that it is not considered to be harmful. Our EPA does not give us any credit for tall stacks. Therefore, we must burn only low-sulfur coal. The result is to put pressure on the price and supply of our lowsulfur coal, of low-sulfur oil that we have to import, and of our natural gas. While tall stacks are not a permanent solution, you could get some credit for this use, pressure would be removed from the fuel market. But the EPA will give us almost no audience to this position. Mr. D'AMICO. Mr. Crawford, we have heard that along the eastern coast, perhaps 93 percent of the energy used by the electric utilities is dependent upon imported fuel. Is there that great a reliance on imported fuel across the Nation? Mr. CRAWFORD. No, I would not say that is true. It is true along the east coast, because the companies there have had no choice but to go to low sulfur oil. Most of them formerly burned coal. But you can't buy 0.3 percent or 0.4 percent sulfur coal, or at least, it is available in very limited quantities. Therefore, as the States and cities along the east coast have gone to lower sulfur requirements the companies have had to go to low sulfur oil. There is very little low sulfur oil in this country. Companies with access to deep water could bring it in from Libya and Algeria. That is why you have this great preponderance along the east coast. To be able to benefit from these imports, you have to have access to the oil. A few hundred miles inland, in the American Electric Power System area, for example, or in Duke Power Company's service area in western North Carolina, to build an oil pipeline from the Atlantic Ocean up there would be a very expensive thing to do. Such companies continue to burn coal. If you reach the point where low sulfur coal is not available and oil cannot be brought in, the companies are in an untenable position. That is the kind of acute problem we will be facing in a few years. Mr. D'AMICO. Is it true to a lesser extent on the west coast? Mr. CRAWFORD. Yes. As I understand it, Southern California Edison brings in nearly all of their oil from Indonesia. Again, it is very low sulfur oil. Mr. D'AMICO. Are they working on any desulfurization plants? Mr. CRAWFORD. From the standpoint of the oil companies or the utilities? Mr. D'AMICO. The utility. Mr. CRAWFORD. The utilities certainly are, because there is no such process that works yet on a reliable basis. There is no practicable way to take sulfur out of the stack gases; despite EPA's conclusion that there is. We maintain steadfastly that there is not. 83-450 O 72-41 Mr. D'AMICO. If the need for imported oil on the east coast is as great as we have reason to believe it is, assume that it were to be cut off tomorrow, do you have any idea what kind of reserves the utilities on the east coast would have to make up for that period of suspension? Mr. CRAWFORD. Yes. Of course, it would vary by company. I would think that about a 60-day supply of oil would be somewhat characteristic. Mr. D'AMICO. I understand that Con Ed also maintains a coalburning facility. Mr. CRAWFORD. I believe they have just phased out the last one, because they could not meet the environmental requirements. Mr. D'AMICO. I didn't mean facility in the sense of a plant that burns coal, but in the sense that in the event of an emergency, they can revert to the use of coal. Mr. CRAWFORD. Yes. Mr. D'AMICO. Can they do that in light of the environmental restrictions? Mr. CRAWFORD. I believe the answer to your question is that the coal burning would not meet the environmental requirements of New York City. Mr. D'AMICO. You indicate in your statement, Mr. Crawford, that: There can be no question but that the precipitous rush to solve environmental problems through sometimes hasty legislative action, and the ensuing process of interpretation by the courts, has brought us near the edge of a real crisis in electric power supply in a number of areas of the Nation. Would you give us more detail on that? Mr. CRAWFORD. The problems this summer have been in several areas, particularly in the Midwest around Chicago and Wisconsin, and in the Southeast section of the country, the Virginias, Carolinas, and Florida, and also in New York City. Those are the three specific examples that I had in mind for this summer. Mr. D'AMICO. I see. Mr. CRAWFORD. Fortunately, in the case of Chicago, Commonwealth Edison was able to work out an arrangement for bringing the QuadCities nuclear plant on the line, thus accelerating the problem there. You heard about Con Ed's problem for Mr. Lehrman earlier today. The Southeastern section of the country has been quite thin on reserves. Fortunately, in the first part of the summer the weather was cool, so that major problems did not develop. I would say the reserves are much thinner than is comfortable in that area. The reason is that the Turkey Point nuclear plant and the Oconee plant of the Duke Power Co. have been late in coming in. Mr. D'AMICO. You state in your statement: The proportions of each basic fuel, and in fact the availability of each, will depend upon multiple factors, such as environmental requirements, technological developments, costs and the extent of competition within and between the submarkets for each basic fuel. I am interested in the last clause, "costs and the extent of competition within and between the submarkets for each basic fuel." Could you expand on that a little bit, please? Mr. CRAWFORD. The point here is that government policy is going to have a direct effect on the various factors that have been mentioned. For example, to go back to the earlier reference of coal versus oil, coal has, in effect, been legislated out of business by government regulation along the east coast, because of the low sulfur content allowable. Therefore, coal is really not a competitor to oil, regardless of the price. Formerly, these two fuels were in strong competition for utility boiler fuel. Mr. D'AMICO. Your use of the term "submarkets" was in what context? Mr. CRAWFORD. When I say "submarkets", I mean the different way that you could use oil, for example. Utilities are not the only market for oil. Transportation and heating and others. Mr. D'AMICO. Were you suggesting that control and production of oil, gas, coal, uranium, and perhaps even the means of transporting these items, by one or a small group of particular interests would have an effect? Mr. CRAWFORD. I was not directly referring to that. Of course, this is a subject in which we are quite interested, and our position is very straight forward, an energy company should not have a degree of control over energy resources that would lessen competition. We believe there should be strong competition between the various fuels. Mr. D'AMICO. The kind of competition which exists today, do you think it is satisfactory? Mr. CRAWFORD. That's a very difficult question to answer from our point of view. On the surface it would appear so. If it's not, we believe that the Justice Department has adequate resources available to it to remedy the situation. Mr. D'AMICO. With your background, experience and knowledge in this area, do you think there is reason for the Justice Department to take a close look in this particular area? Mr. CRAWFORD. Mr. D'Amico, I do not see overt instances of this kind. But I would hasten to add that I do not consider myself to have a great amount of access to this kind of information. Mr. D'AMICO. Thank you, sir. Mr. HOWARD. Thank you, Mr. Crawford. In the hearings we have held thus far, and speaking to the problems of availability of fuel, two things have been mentioned among othersby almost everyone. First, the low price at the wellhead for gas seemed to be the biggest obstacle, and the excuse for why we are going backward in well exploration. The second point was the holdup on the sale of lands or the leasing of lands by the Government off-shore in the Gulf of Mexico. As you know, late last week the Federal Power Commission eased restrictions on the price of the new gas sources, and yesterday the Secretary of the Interior announced the date for leasing or selling of 600-and-some-thousand acres, I believe, of offshore land, to be held September 12, in New Orleans. Do you feel these two things will have a beneficial impact on the problem that we have? How much time will it take before anything is really felt, as a result because of those decisions? Mr. CRAWFORD. I think they certainly are decisions in the right direction. We are very much in favor of those steps being taken by the Government which would provide additional supplies of oil and gas. It would appear these two steps would accomplish that objective, at least they would tend to accomplish it. As to the timing, it is my understanding that this is not the type of development that would provide relief very soon. After the lands are opened up, exploration and development would have to take place. It is probably a matter of 2 or 3 years, at least. Mr. HOWARD. It has been said that when someone does get the rights to this offshore acreage, that it is not used or utilized. Many of the big companies that do get this right just hold on to it. Wouldn't you say this is somewhat against the whole idea of having these sales? If the people who purchase it aren't going to use it, then what's the sense of Interior letting them have it? Mr. CRAWFORD. If that is true, then I would say it certainly is not the purpose of the sales. I do not know if it is true or not. Mr. HOWARD. It has been claimed. If it were true, do you think it might be proper that reasonable time limits be set for investigation into this acreage, and if something is productive in that area, that another reasonable mandate of time would be in order for the development and production of this resource? The whole idea of doing these sales is to provide more fuel for the Nation's needs. Mr. CRAWFORD. Yes, Mr. Howard. I am not an expert on oil and gas matters, but, as a general conclusion, what you have said makes good sense. When areas are bid in, they should be developed over some reasonable period of time. Mr. HOWARD. On a smaller level-and I don't know whether you can answer this or not-but this is something that has been on my mind: We talk about saving fuel and avoiding waste, and having people be sure to turn out their lights when they are not really needed, so that we can save a great deal of energy. The fact and the figure that I get, which I presume is accurate, is that the normal electric bulb is 10-percent efficient for light, 90 percent going in conduction and heat. It is extremely inefficient for its main purpose that of producing light. How much research is being done on this basic thing to get a little more light and a little less waste from the vast number of electric light bulbs? Mr. CRAWFORD. It may be an inefficient use of energy, but it is the most efficient way we know of to light a space. Mr. HOWARD. Are we doing as much research, to find something better, because they have been pretty much the same, I guess, for years and years and years. Mr. CRAWFORD. Research is continually going on in these areas by the bulb manufacturers. Fluorescent lights are more efficient than the normal incandescent lights. That's something of fairly recent vintage. If you take the usage of electricity by all the small appliances in this country, it only amounts to about 4 percent of the total kilowatt hours. Kilowatt hours are used basically in keeping industry and commerce running and creating jobs, and in operating labor-saving devices. I think, as I indicated earlier, that we should avoid wasting energy and we should use it wisely, but I do not believe we will save a large percentage of our consumption this way. Mr. HOWARD. That's only a part of the 4 percent of the total energy Mr. CRAWFORD. The 4 percent includes radios, vacuum cleaners, irons, and clocks, for instance, and all the rest, which are really not frivolous uses at all. Mr. HOWARD. What would you say, then, has the greatest impact on waste? Can you think of one single kind of waste in this country which is then not in the normal residential consumer area, because those consume only 4 percent, you say. Mr. CRAWFORD. You're talking about electricity now, or other uses of energy? Mr. HOWARD. Let's consider all uses of energy that have the biggest waste which has the greatest impact on our resource availability? Mr. CRAWFORD. Individual automobiles. If you compare the efficiency of an automobile driven by gasoline, it is about 10 percent. If it were electrically driven, if you had a suitable kind of electric vehicle, and you count up all the losses-the generation, the transmission and all the rest-it is 20 percent efficiency. This is twice as efficient as the individual automobile. Mr. HOWARD. That's an area where they think it is going to be half by 1980. With the demands for a less-polluting engine, it appears that, as far as the gasoline consumption is concerned, you're going to get half the mileage that you do today, which would mean you would need twice the fuel to go the same number of miles. Mr. CRAWFORD. That will aggrevate the problem. Mr. HOWARD. How about the wasteful uses of electricity, which really have an impact on the total amount of use? Mr. CRAWFORD. In electrically heating a house, inferior insulation would be a source of wasted energy. Also, the point that was made earlier this morning that buildings could be designed without windows, unlike some modern structures. These are opportunities for savings. Mr. HOWARD. Is there much loss in transmission? Mr. CRAWFORD. It's on the order of 5 to 6 percent of the total. Mr. HOWARD. Thank you very much, Mr. Crawford. We certainly appreciate your coming here, and your testimony. We hope that as we develop our hearings, if we find specific areas of interest where we may be able to call upon you for information Mr. CRAWFORD. Please do so. Mr. HOWARD. Thank you very much. The next witness this afternoon is Mr. Charles A. Robinson, Jr., staff counsel to the general manager, National Rural Electric Cooperative Association. STATEMENT OF CHARLES A. ROBINSON, STAFF COUNSEL, NATIONAL RURAL ELECTRIC COOPERATIVE ASSOCIATION; ACCOMPANIED BY DONALD SMITH, STAFF ECONOMIST, AND BRADLEY KOCH, STAFF ELECTRICAL ENGINEER Mr. HOWARD. Welcome to the subcommittee, Mr. Robinson. We do have your prepared statement and, without objection, it will be made a part of the record. |