Keeping synfuels on the back burner

THE United States synfuels program is hardly a ``pariah'' among all the hundreds of federal programs under way in Washington. Still, it's hard to find much support for the program, which has been barely hanging on in the increasingly stringent Washington budget climate. Waning commitment to synfuel development was underscored by last week's vote by a House subcommittee to shut down the Synthetic Fuels Corporation (SFC) and transfer a small part of its functions, primarily in research, to the US Department of Energy. By doing so, the House subcommittee argues, Congress could save at least $8 billion from the whole program.

Would such an action benefit the nation in the long run, through better use of scarce budget dollars? Or would eliminating synfuels make the US more energy dependent and more vulnerable to a possible interruption of energy supplies?

The synfuels program evolved from Carter administration efforts in the late 1970s, a time of perceived energy scarcity, to find alternative energy sources. The purpose of the SFC was clear-cut: to create an entire new industry that would eventually produce 500,000 barrels a day of synthetic fuel.

Unfortunately, after the expenditure of substantial sums of money and years later, the US is still a long way from having a viable synthetic fuels industry. Most major energy firms are out of synfuels. The industry's major ongoing project, the Great Plains Coal Gasification Project, in North Dakota, a joint venture involving several corporate sponsors, is directed at converting coal into synthetic natural gas. It still requires a hefty federal subsidy.

Granting that the synfuels program has fallen short of expectations, and that current energy market conditions lend little compelling weight to synfuels, the long-range impact of scuttling the program merits review by the full House and the Senate.

It can be tempting, and sometimes justifiable, to kill a federal program with as many question marks hovering over it as has this particular program. Yet, Congress should consider whether the nation would be better off dismantling the technical and administrative teams that run the program. Congress might also consider whether the nation's long-range energy policies should be based on momentary market and price considerations alone. This was how the US and the West became vulnerable to the oil producer price and supply shocks in the first place. Oil prices are currently low. And oil supplies plentiful. But that is not to say that such conditions will prevail through the remainder of the century. Such a highly technical and obviously costly effort as the synfuels program takes years of research and seedtime.

In one sense, the Carter administration energy approach -- seeking to identify promising and nonpromising energy alternatives -- has worked. Synfuels could not be currently considered one of the most immediately promising ventures. The biggest gains have come in energy conservation -- now also receiving scant reinforcement from Washington. Solar looks only modestly promising. But because synfuels will continue to play a small part in the nation's overall energy mix, it makes sense for Congress to keep a scaled-down federal program under way as part of a continuing responsible effort to prepare for evolving energy needs.

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