Spencer Abraham

Excerpts from a Monitor breakfast on energy, an energy bill, and the recent blackout.

Energy Secretary Spencer Abraham is a graduate of Michigan State University and of Harvard Law School. Prior to becoming energy secretary, he taught law, was chairman of the Michigan Republican Party, served as deputy chief of staff to Vice President Quayle, practiced law, and was a US senator from Michigan. During his term in the Senate, Mr. Abraham twice proposed the abolition of the Energy Department, a position now outgrown. He is the father of twin daughters and a son.

The Energy Department describes itself as "principally a national security agency." It has a budget of $23 billion and includes 14,000 federal employees and 100,000 contract employees spanning 24 research labs and four power-marketing administrations.

Here is some of what the Secretary said at breakfast on Thursday:

On energy prices this winter:

"Our latest short term energy outlook was a little more positive with respect to natural gas projections than the one previously. One of the real challenges we have in a couple of these areas is that much of this is out of our control in terms of the impact of weather. And this winter's weather will have a very substantial impact especially on the home heating issues, on the natural gas issues....

If the winter is normal in terms of temperature, our most recent projections would have this year's home heating bills, at least in the northeast, projected as lower than last year. But if it is unusually cold, that changes the equation."

On the longer term energy outlook:

"We know that in the long term, the demand for electricity is slated to increase by 45 percent over the next 20 years, the demand for natural gas to double over the next 20 years. The overall demand for energy is going to increase even under the best case scenarios in terms of efficiency improvements and conservation, and that means we really have to move ahead with development of a more diverse source of fuels and maintain a diversity of fuels or we will face these kinds of fluctuations and price spikes that affect us all."

On whether deregulation contributed to August's electric blackout:

"We have had blackouts in this country in both areas that have gone through deregulation and areas that were stoutly regulated. We will wait to see what the conclusions of the task force [studying the blackout] are ."

On the need for legislation to improve operation of the electrical grid in the US:

"I can't rule out anything. What I would say though, and I stressed this at the [congressional] hearings, is that if we do not address these broader issues - that have nothing to do with this specific blackout - these broader issues of an inadequate and congested transmission grid, of a system that hasn't had enforceable reliability standards governing it - then the likelihood of a big blackout [or] other disruptions in the future, it seems to me, will continue. That is why we are stressing the need to get this energy legislation completed."

On whether Congress will pass a comprehensive energy bill:

"I am predicting passage. I think that all sides have a compelling interest in getting this work done. I can't imagine people want to go home from this congressional session having - leaving behind as unfinished business an energy bill against a backdrop of all of the challenges we have had. And again, that is why the need for a comprehensive bill is so vital."

On whether he worries about a repeat of a 1970s style oil price shock:

I have "confidence that we are not going to see that kind of a '73 style outcome in the days ahead."

On what caused recent gasoline price spike:

"Well, the Energy Information Administration, which is a really an independent arm of the department created by congress to provide objective analysis of a lot of these energy questions, is wrestling with that for us right now..."

On impact of nuclear weapons activities by Iran and North Korea:

"I would just say as a personal view that recent developments in Iran and what we are contending with in regard to the [North Korea] challenges the very fragile, always fragile, regime of the NPT [Non-Profileration Treaty] to the limit. And we simply can't allow the North Korea model to be employed by others in which people operating under the protections of [the] ... treaty can essentially develop all of the various components or many of the various components of the program that could have dual use and then at some late point in the process make a quick break, work quickly to perfect the components that allow them to have a weapons program, and then abandon the treaty. That can't be allowed to continue..."

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