Thank you, Dan, for that kind introduction.

While many of us in this room aspire to greatness in perhaps only one field, Dan has achieved it in many - a leading historian in our industry; a Pulitzer Prize winning author; a leading global energy consultant; and of course, the chief host of the famous “CERA week,” now in its 25^th year.

There are few events like this that bring together so many distinguished leaders in the energy field for frank discussions and a worthwhile exchange of ideas, so I’m thankful for the opportunity to address this illustrious crowd.

The theme of this week’s conference is, “The New Prize: Energy’s Next Era.”

I will focus my remarks this morning on what the Bush Administration believes the role government should play in shaping energy’s next era.

Our policy is based on two fundamental ideas: a commitment to free and well-functioning markets; and a belief in the great enabling power of technology and innovation.

We find ourselves at an important time for crafting sound energy policy.

Normally, people don’t give too much thought to energy issues, they simply flip a switch with the expectation that the lights will come on, and they fill their cars expecting gasoline to be cheap and available.

However, recent events such as the hurricanes last summer and their disruption to our fuel supply, have made American consumers more sensitive to changes in the energy market and more aware of the challenges that face the energy sector.

It is under this intense spotlight and heightened awareness that we must address these challenges – both in the near- and long term – by establishing new priorities and promoting bold initiatives that are consistent with our core principles.

Some say the best way to meet our energy challenges is by imposing new taxes, increasing existing taxes, or developing proscriptive regulations and unwise mandates.

These are not solutions; in fact, if implemented, these proposals would only make matters worse.  History has taught us that lesson many times.

Instead, I think we must recalibrate our focus on what I earlier stated as the fundamentals of a strong energy strategy.  

Once again, we must reaffirm our commitment to a fair and well-functioning marketplace, and we must increase our investment in the one resource of which we are certain to have an infinite supply:  human ingenuity.

The unveiling of the President’s budget priorities this week and the announcement of new initiatives in the area of science and advanced energy in last week’s State of the Union address do just that.

However, before I delve into specific policies, I think it’s important to put this discussion into proper perspective.

The challenges we face in providing for increasing energy demands are great. 

The Department of Energy estimates that the global demand for energy may increase by as much as 50 percent by 2025, with more than half of that growth coming from the world’s emerging economies.

Specifically regarding electricity, the growth is projected to be particularly steep; increasing nearly 75 percent over the next two decades.

Growth forecasts of this magnitude cannot be ignored – and we must put policies in place today to address the energy needs of tomorrow.

Throughout the ages, from the first decades after the discovery of “rock oil” in Pennsylvania, and recurring predictably thereafter, experts have predicted dwindling supplies of oil and other energy resources.

Such predictions came into vogue again in the 1970’s, and similar concerns are gathering today.

What the prophets of doom and gloom underestimated in their static view of the world, is the dynamic nature of the economy and the power of technology and innovation resident in the human mind.

History has proven that innovation and technological advancement can overcome almost any obstacle and serve as the driving engine of economic growth and prosperity.

To compete in the increasingly global economy, we know what we must do – and that begins, first and foremost, with the building blocks of technical innovation: math and science.

Craig Barrett, the Chairman of Intel, has said, “U.S. technological leadership, innovation, and the jobs of tomorrow require a commitment to basic research funding today.”

It is with this in mind that the President recently proposed bold, visionary initiatives and established new priorities that will serve as the cornerstone of a sound energy policy.

While broadly called the American Competitiveness Initiative, it is through this program that the President seeks to reinvigorate our math and science base to lead the discoveries of tomorrow.  Because energy policy is so closely tied to economic prosperity, the Department of Energy and our great national laboratories are taking a leading role in this effort.

In the past, federally funded research has helped to spawn vital technologies such as personal computers, medical imaging devices, hearing aids, global positioning devices, and countless innovations in the energy sector that have turned yesterday’s wild idea into today’s producing asset.

Over the next ten years, the combined budgets of the National Science Foundation, the Department of Energy’s Office of Science, and the Department of Commerce’s National Institute of Standards and Technology will exceed $50 billion in new research funding, a doubling of those budgets over the next ten years.

This investment will allow us to build world class research facilities and encourage the next generation of great scientific talent, but more importantly, it will allow us to unleash discoveries that we cannot imagine today.

Because the availability and price of energy - be it in our cars, homes, or businesses - is so closely tied to global economic growth and security, America will use our investments in science to develop the next generation of energy technologies.

This investment ties directly into the President’s Advanced Energy Initiative which will harness R&D and apply it to the development of new, more efficient solar and biofuel technologies, hydrogen-powered vehicles, and coal fired power plants with zero emissions.

This is not a future based on fantasy, but rather on vision and sound science.

Another key component of the Advanced Energy Initiative is the expansion of nuclear power. 

In the United States, the Energy Bill signed by the President last summer has jump-started a nuclear renaissance.  Already we are seeing positive activity in the industry and in fact, a number of companies have begun the process to site and build the first new nuclear plants in decades.

This domestic resurgence is key to a larger initiative known as the Global Nuclear Energy Partnership (GNEP).

The idea is simple: GNEP is based on the principle that energy and security go hand in hand.

GNEP will develop and demonstrate new proliferation resistant technologies to recycle nuclear fuel and reduce waste. The U.S. will also work with other advanced nuclear nations to develop a fuel services program that would provide nuclear fuel and recycling services to nations in return for their commitment to refrain from developing enrichment and recycling technologies. GNEP is designed to allow developing nations to reliably access clean nuclear energy as an electricity source for their people in a safe and cost effective manner, and in a manner that enhances the world’s nonproliferation objectives.

These ideas are interconnected.  We believe these investments in research and education will yield advances in scientific discovery and new energy technologies, including those that enhance the development of clean, safe nuclear power.

Everywhere we look there are new challenges on the horizon.  If we choose to meet them head-on, if we elect to put our best minds to work, to find the best ways to meet those challenges before they arrive, and if we commit the resources necessary to make that a reality outside the lab, boardroom, and classroom, then I think history will record that our Administration had the policy right for Energy’s next era.

As the late Warren Brookes said, “the real energy of our society arose not from the raw materials in the ground, but from the brain-matter in our heads.”

I believe that.

And I believe that through the cooperative leadership of government and industry, we can continue to pursue the promise of free markets and ingenuity to keep our economy healthy and growing, to continue creating jobs, and to build a safer, cleaner, better world for future generations.

Thank you.

Location:
Houston, Texas