Elk Hills Naval Petroleum Reserve Circa 1920s
The Office of Fossil Energy has the longest directly-traceable history of any organization in the Department of Energy. While the nuclear energy program can look back to the Manhattan Project of World War II for its origins, the Federal Government's involvement in fossil fuel resources began several decades earlier, in the early 1900s.
Oil Dominates Early Concerns
Much as today, petroleum was a major concern for the Federal Government at the start of the 20th century. Barely 50 years after the birth of the nation's oil industry the Nation's leaders were already worried about an impending oil shortage. By 1909, a half century after Edwin Drake drilled the U.S.'s first oil well, the Navy had converted from sails and coal to "black oil," powering their ships with unrefined crude oil. But the long-term future of oil supplies in the United States was by no means certain. Many of the nation's largest oil fields - in Texas and Oklahoma, for example - had not yet been discovered.
To ensure sufficient fuel for the fleet, the Government began withdrawing probable oil-bearing lands from the public domain. Between 1909 and 1924, tracts in California, Utah, and Wyoming were set aside that became the Naval Petroleum and Oil Shale Reserves - the oldest component of today's Fossil Energy organization.
Drake drilled his first well in 1859 near Titusville, Pennsylvania, but by 1916 the center of the nation's oil activity had shifted westward. The U.S. Bureau of Mines - established in 1910 in the Department of the Interior - recognized the need to learn more about the extraction of oil and began looking for a place to locate a petroleum experiment station.
In 1916, the Bureau selected Bartlesville, Oklahoma. A year later large oil discoveries in the Osage Indian Nation just west of Bartlesville confirmed that the hub of the nation's oil industry was now indeed firmly implanted in the Midwest. When the Bartlesville experiment station opened in 1918, the Federal Government's petroleum research program had begun.
Oil again was on the nation's mind during World War II. Prospects of huge oil finds in Indonesia had been one motivation for Japan's attempted conquest of Southeast Asia. Similarly, lack of indigenous oil supplies had led Germany's war machine to develop synthetic substitutes for petroleum. German scientists developed ways to change the country's abundant coal supplies into liquid fuels, typically using high-pressure 'brute-force' processes.
Coal Enters the Federal Energy Program
When German scientists and technical documents were captured in the latter stages of the War, U.S. interest in these coal-to-oil methods was sparked. Because the United States also possessed massive quantities of coal, the Federal Government began investigating possible coal-based synthetic alternatives should America's natural oil supplies begin to decline. Passage of the Synthetic Liquid Fuels Act of 1944 began the first concentrated effort to study future ways to use the Nation's abundant coal supplies.
Coal's potential was also on the mind of West Virginia Senator Robert Byrd in 1961 when he successfully urged Congress to establish the Office of Coal Research in the U.S. Department of the Interior. With a modest first year budget of $1 million, the Office started small but over time began to study a wide range of coal technologies, including the conversion of coal to gas and liquid fuels and new ways to combust coal more cleanly.
Oil Cutoff Brings Energy to the Forefront
The oil embargo of 1973 again brought energy and the security of oil to the forefront of the nation's attention. When several Persian Gulf nations of the Organization for Petroleum Exporting Countries temporarily ceased oil shipments to the United States and sent world oil prices skyrocketing, U.S. policymakers recognized that energy was no longer something American citizens could take for granted.
The Energy Reorganization Act of 1974 created two new agencies: the Energy Research and Development Administration (ERDA) to carry out a more aggressive energy development program, as well as oversee the Nation's nuclear weapons and naval reactor programs; and the Nuclear Regulatory Commission to regulate the nuclear power industry.
The Office of Coal Research, shifted from the Interior Department to the newly-created ERDA, would become the core organization for the Fossil Energy program. Along with coal research, the new Fossil Energy office also became the home for the Government's petroleum research program and a small synthetic fuels research program transferred from the Bureau of Mines.
The oil embargo of 1973 not only led to a reorganization of federal energy functions, it also called attention to the need for an emergency stockpile of crude oil. Unlike the federal oil tracts set aside in the early part of the century, the Government needed a reserve that could pump emergency oil into the market much faster than any oil field. Such a stockpile of crude oil had been discussed in the Eisenhower Administration but never implemented. On December 22, 1975, however, with the economy reeling from the first shock of oil shortages, President Ford signed the Energy Policy and Conservation Act, extending oil price controls, mandating automobile fuel economy standards, and authorizing creation of an emergency oil reserve. The final major piece of today's Fossil Energy organization, the U.S. Strategic Petroleum Reserve, began forming.
The Department of Energy is Created
America would experience more energy shocks, however, in the next several years. In 1977, with the Nation facing its most severe winter in decades, natural gas shortages caused thousands of factory and school closings and threatened cutoffs to residential customers. More unrest was also taking place in the Middle East, now the world's dominant supplier of crude oil. Islamic fundamentalism was on the rise in Iran and elsewhere, and within two years, the Shah of Iran, one of the world's most prolific exporters of crude oil, would be overthrown.
The rapidly escalating global energy issues convinced the U.S. Government that a sharper focus should be applied to federal energy programs. On August 4, 1977, President Carter signed the Department of Energy Organization Act, consolidating more than 30 separate energy functions carried out by various government agencies, including ERDA. On October 1, 1977, the U.S. Department of Energy activated.
In the original Energy Department organization, Fossil Energy programs were managed as a division under the Assistant Secretary for Energy Technology. On October 1, 1979, many of the Department's energy research functions were recognized, and the Fossil Energy program was elevated to its current Assistant Secretary-level status.