Amy Klobuchar

Energy Freedom & Opportunity: A Call to Action - Nov. 14, 2005

Amy Klobuchar
November 14, 2005— Minneapolis, Minnesota
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I'm honored to be with all of you here this morning at the University of Minnesota to discuss some solutions for people, for a change. And I'm especially excited to share my thoughts about creating a home-grown energy economy, with Minnesota leading the way. I believe in my heart that these ideas will create jobs, make us more free, and preserve our country's pre-eminent role as the world's leader in ideas and innovation.

This University is a world-class institution. It has a strong commitment to education ... research ... and service. And it's a magnet for top scholars and students from around the world.

The University's importance and influence is strong -- and it will grow stronger. Minnesota's greatest need in the years ahead -- meeting the challenges of a global and knowledge-based economy -- happens to be this University's greatest strength. And that's why the future of Minnesota and the future of the University of Minnesota are really one and the same.

You can see this future every day right here, right now, in the research that's taking place at the University.

For example: The Initiative for Renewable Energy and the Environment has brought together experts from across the University to develop renewable resources for clean energy and environmentally-sound products. The Initiative is currently involved in nearly 40 pioneering research projects -- ranging from basic research on hydrogen fuel cells to technology for converting biomass plant material into fuel and products like plastics and fibers. They've also helped put a good-sized wind turbine on the University of Minnesota Morris campus as part of a unique wind-to-hydrogen demonstration project.

As the work of this Initiative shows, the University is at the center of an emerging transformation in how our society produces and uses energy. There is tremendous potential to transform our economy based on renewable energy development.

You know: For decades, Minnesotans and Americans have been presented with either-or choices in our energy policy:

If you were an environmentalist, they said you were against jobs.
If you wanted to reduce our dependence on oil from Saudi Arabia, they said you were attacking an important ally. If you thought the federal government should promote more fuel efficiency, they said you were against the free market.

We've always known that we needed to get beyond these false choices -- and the work that is being done here at the University makes me confident that we have many good choices ahead.

But these ideas will become reality only if we have forward-looking policies and the visionary, determined leaders to make it happen.

And that's why I'm here today. We need national leaders who will be passionate advocates for the future we know we can build, leaders who will work for solutions for people, for a change.

In my remarks this morning, I will lay out what I see as the short- and long-term problems with our current national energy policies and our economy's dependence on foreign oil. Then I will discuss a series of energy policy initiatives that will -- if we have the passion and leadership and sustained vision -- transform our economy, reform our foreign policy, protect our natural resources and renew and restore our rural communities -- with Minnesota know-how leading the way. And what an exciting future this will be.

I see this as nothing less than an urgent call to action -- to make the oil companies use their exorbitant profits to help invest in our energy future and to provide relief for Americans who are already struggling with high energy prices. I call on Washington to push the kind of investment in homegrown renewable energy that will free us from foreign oil and create millions of new jobs.

In the next few months, I'll continue to deliver this call to action as I visit towns in Minnesota, both big and small, to talk about my "Energy Freedom and Opportunity" solutions for Minnesota. As I've traveled the state in recent months, many Minnesotans have shared with me their concerns about the rising costs of energy. And, of course, I experienced it myself every time this summer when I went to fill up my own car with gas and saw the price approach three dollars a gallon. While prices have dipped in recent weeks, experts say we should get used to elevated gas price levels, and not be surprised if they go higher again.

In fact, it's estimated that Americans will spend over 200 billion dollars more on energy this year than we did last year. That's an increase of nearly 25 percent. Our country currently must buy about 60 percent of our oil from foreign countries. A decade ago, it was less than 45 percent.

This growing dependence on foreign oil threatens both our prosperity and our national security. It makes us less well-off and less free.

Today, we're suffering from the failed energy choices of our political leaders in Washington and their friends in the giant oil companies. Their failed choices have drained our pocketbooks ... inflated our trade deficits ... limited our economic competitiveness... threatened our environment ... and put our national security at risk.

If we needed any reminder of our vulnerability, Hurricanes Katrina and Rita provided it.

We can't continue down the same energy path that's got us here.

But I'm not here this morning to dwell on the past. Instead, my aim is to put a spotlight on our historic opportunity -- the opportunity to secure our energy future and our prosperity for the 21st century. I believe we're on the threshold of a far-reaching energy revolution that can transform our national economy and our world.

As a nation, we can go there willingly -- seizing the initiative and taking our destiny into our own hands.

Or we can hold back, allow inertia to control us and wait until crisis or catastrophe forces us to change.

As Americans, we've always believed it's better to take bold action and lead the way to create a new world. In this case, not only will we secure our energy future, we'll also secure our economic future.

There is, I believe, a parallel between what's happened over the past 30 years in the advanced development of computers and communications and the opportunities available to us in the coming decades for new development in the energy sector.

Thanks to advances in computers and communications, we've seen the rise of whole new industries ... the birth of thousands of new companies ...the creation of millions of high-tech jobs ... and sweeping advances in productivity across virtually every sector of our economy.

That same potential to grow our economy and break the grip of imported oil on our way of life is available to us as we develop the resources and technologies for homegrown renewable energy. We are now only at the dawn of this renewable energy revolution, but it already promises to be as momentous as the industrial revolution of the 19th century and the information revolution of the 20th century.

If we can have a Silicone Valley for computers, we can have a Red River Valley for energy. Like the high-tech companies of California, we will have high-energy companies here in Minnesota. Instead of talking about research at Stanford, it will be research in Morris and Duluth.

To move forward, though, we need to face up to some serious challenges.

Our challenge in the short term is to help people pay their bills and keep our economy growing in the face of dramatically higher energy costs.

Our families and businesses have already contended with high prices at the gas pump this year. It's estimated that the average American family of four will spend nearly 3,000 dollars on gas this year.

As if that weren't enough, we now face the prospect of record-high heating costs this winter.

In Minnesota, it's estimated that home heating bills could rise as much as 50 to 75 percent over last winter. And my friends in Embarrass, Minnesota, have already seen temperatures get well below freezing on many days and nights this fall.

The Arrowhead Economic Opportunity Agency, serving Duluth and the Iron Range, expects that its federal heating assistance money won't even last through February. Meanwhile, the Republican-controlled Senate has voted three times to reject more funding for this important federal program, which has been chronically underfunded and now has a budget that is actually below what it was 20 years ago.

These skyrocketing energy costs are hurting our families ...they're hurting our businesses ... they're hurting our farmers ... they're even hurting our schools, which must choose between hiring teachers or paying higher heating and transportation costs.

These are among the terrible consequences of our over-dependence on fossil fuel, especially foreign imported oil.

That's why our long-term challenge is to move toward energy independence.

As the growing economies of China and India and the rest of the world, demand ever more oil, prices will be driven higher for these finite resources. America now spends over 200,000 dollars a minute on foreign oil imports -- and these imports alone account for about one-third of our total trade deficit.

A one dollar price increase for a barrel of oil translates into seven billion dollars a year that America sends overseas to pay for it. Just a few years ago, we were paying only 25 dollars for a barrel of oil. Today, we're paying around 60 dollars. Just imagine the hundreds of billions of dollars that the American economy has lost -- that we, the American people -- have lost as a result.

Over 25 billion dollars a year for oil imports goes to Persian Gulf states. To help secure the flow of oil from the Middle East, we spend 50 billion dollars each year to deploy our military forces in the Persian Gulf and to supply military assistance to countries in the region. And that doesn't include the lives and dollars we're spending in Iraq.

Finally, there is also the threat posed by global warming and climate change.

Yes, these challenges are of historic dimensions -- but so are the opportunities. Above all, the opportunity to free ourselves from a fossil fuel economy and embrace a renewable energy economy that will sustain us for years to come.

The resources and technologies that we need to transform our energy future are already well within our reach. And it's time to change course. So let's talk about solutions, solutions that will improve our economy and make us more free, solutions for people, for a change.

As the TV commercials tell us, the initials "B.P." no longer stand for British Petroleum, but for Beyond Petroleum. In fact, it's something that all of our oil companies should now aspire to.

And what, exactly, is "beyond" petroleum?

Well, the answer is as close as the nearest corn or soybean field in our Minnesota countryside --- where we've already started to transform America's agricultural abundance into clean ... renewable ... affordable energy.

Here in Minnesota, we have the ability to produce a wide variety of homegrown energy, including ethanol, biodiesel, wind, solar, hydrogen and biomass. This will be a huge source of jobs in Minnesota for decades to come.

I'm proud that our state is already leading the way to energy freedom and opportunity.

Most notably, we've been a pioneer in turning corn into ethanol for gasoline. During the past 25 years, ethanol has proven to be one of the great success stories in the Minnesota economy -- especially our rural economy. In Minnesota, the ethanol industry already generates nearly 600 million dollars in annual economic output and is responsible for over 2,500 jobs -- and some estimates are even higher.

A few months ago I had the opportunity to visit the ethanol plant in Benson about 150 miles west of here. It's one of Minnesota's 14 ethanol plants, with one biodiesel plant up and running and two more opening soon. Workers at the Benson plant take the corn grown in Minnesota fields and turn it into energy to power our cars. These workers are so proud of what they have done -- combining Minnesota corn and Minnesota homegrown renewable energy.

One of the good things in the federal energy bill passed this year was a requirement that refiners nationwide double the use of ethanol in gas -- to 7.5 billion gallons a year by 2012. This will lead to six billion dollars in new investment in ethanol plants across the country, generating some 300,000 new jobs. A good share of this economic benefit will flow to Minnesota farmers and rural communities. But we can do even more.

Minnesota has helped to lead the way with our 10 percent ethanol content standards for gasoline. The new Minnesota standard, which I applaud, is 20 percent ethanol blend in gasoline by 2013 unless ethanol has already replaced 20 percent of the state's motor vehicle fuel by 2010 percent. Unfortunately, the federal standards are lagging far behind. I will fight to have the federal government adopt the same standards as Minnesota. This will be good for farmers and good for the environment.

Biodiesel fuels are another important development. Minnesota was the first state to mandate its use. Biodiesel capacity is increasing in Minnesota and will become a more and more important part of our home-grown energy portfolio.

Corn-based ethanol and soybean-based biodiesel fuel are just the first steps in our renewable energy revolution. The science and technology that's driving this revolution is changing and advancing very rapidly.

As Robert Elde, dean of the U's College of Biological Sciences, has pointed out: "This is the first application -- corn from the field and into the fuel tank... The next generation of ethanol production won't use corn kernels, it'll use corn stalks and biorefining."

In fact, the next generation of research in bio-fuels is now starting to come out of the lab and into commercial applications, as our innovative scientists find ways to make fuel from crop wastes, wood wastes and mill residues, food processing residues and other plant (or biomass) material.

Think about the start of the information age revolution: The first computers were the size of large rooms and could accomplish only elementary calculations. But we had to start there to get to where we are now -- with powerful computer devices that now fit in the palm of a hand and the enormous computing power that's found everywhere in our daily lives.

Yet another renewable energy source to be found in abundance in Minnesota is wind power. Aaron Peterson -- a state legislator from Madison, Minnesota, who is with us today -- tells me that the energy potential of the winds that blow across Minnesota promise to make us the "new Saudi Arabia."

Here's what else Aaron's told me:

Minnesota currently produces 600 megawatts of wind power from 750 turbines. This equals the energy used by a quarter of a million homes during an entire year.

Wind power also replaces electricity produced from expensive natural gas. At the current and increasing natural gas prices, the fuel cost of gas already exceeds the cost of wind power. One thousand megawatts of wind power translates into 3,000 manufacturing jobs ...700 installation jobs ... and 600 ongoing operations and maintenance jobs.

Denmark already gets nearly 20 percent of their total electricity from wind power. I've biked around those windmills, and I can tell you there's a lot of wind in Denmark!

Renewable homegrown energy resources like ethanol, biodiesel, solar and wind power are good for our farmers ... better for our environment ... and cheaper for our consumers. The only ones who don't like it are the oil lobbyists in Washington.

National Renewable Portfolio Standards for Electricity

Minnesota's early success with wind power demonstrates the value of establishing national renewable portfolio standards. These standards would require utilities to supply a minimum percentage of their electricity from renewable sources in order to reduce dependence on fossil fuels and to minimize pollution and the heat-trapping gases that cause global warming.

Minnesota already has a 10-percent standard for renewable energy in electricity production. It's been a key support for the growth of our wind power industry. We should take this Minnesota standard to the national level -- and extend it so we aim for 20 percent of our electricity to come from renewable sources by the year 2020.

A 20-percent renewable electricity standard by 2020 would create 5,000 new jobs in Minnesota alone.

As we develop these renewable energy resources, we must continue to do more to strengthen our energy efficiency and conservation efforts.

Benjamin Franklin said, "A penny saved is a penny earned." In the case of oil, a barrel saved is a barrel that we don't have to import.

Our homes and businesses just aren't as energy efficient as they could or should be. Conservation -- consuming less energy -- is important. But being more energy efficient -- getting more while consuming less energy -- is even better. Energy efficiency measures offer tremendous cost savings potential for both consumers and businesses -- and they must be an essential part of any comprehensive energy policy. This is especially true when it comes to promoting greater energy efficiency with our vehicles on the road.

Transportation accounts for 70 percent of America's oil consumption -- and it's responsible for 79 percent of the growth in oil consumption over the past two decades. No wonder: The fuel efficiency of the American car and light truck fleet is at its lowest level in 20 years.

If we're going to reduce our oil dependence, we need our cars and trucks to go much farther on a tank of gas -- and, better yet, they should run on something other than oil.

Hybrid cars are becoming more popular and more efficient. The old version required you to plug in the car or carry around extra batteries. Because we invested in research and provided federal incentives, we've not only seen a much better product brought to market -- we've also seen an explosion in consumer demand that would have been unthinkable just a few years ago.

The waiting lists for hybrid vehicles show that consumers welcome efficient designs. Ford recently announced an increase in their flexible fuel vehicle production to 250,000 next year.

Fuel-efficient vehicles are now speeding fast into the mainstream. But we can still do more in the way of incentives for both the manufacture and purchase of hybrid and "flexible fuel" vehicles.

The federal government should also lead by example.

In April 2000, President Clinton signed an Executive Order to reduce the federal government's oil consumption by 20 percent by 2005 -- using a combination of alternative fuel and vehicle efficiency technologies. When President Bush was elected, that order languished. In fact, the federal government has reduced its oil consumption by less than one percent since 1999. We can do a lot better than that.

The federal government should lead the way in buying energy-efficient vehicles. I agree with those who have called for a goal that by 2010, the federal government should be replacing (through attrition) our existing fleet with fuel efficient cars and trucks.

We must also use our public policies to help jump-start and support private-sector research and development focused on renewable energy resources and technology. The industries of the future will come from these developments -- and we should be at the forefront. Europe and Japan have gotten a head start on us.

The federal government invests in research in a variety of new energy technologies. But we need to coordinate the many different energy research and development programs buried within many different government agencies, whether it's the Energy Department, the Defense Department or the various agencies that make science grants.
Right here in Minnesota, the University's Initiative for Renewable Energy and the Environment and the Energy Alley Research Workgroup are good examples of the public-private partnerships that will make a difference.

We can put technology to use not just with new energy sources but to help make existing energy sources like coal cleaner and more efficient. The building blocks for innovative energy solutions are coming forward from research labs here in Minnesota and around the world. Entrepreneurs as well as academic researchers are working to bring these discoveries out of the laboratories and into our daily lives. These innovators need our help and support. We need a more urgent commitment to make their ideas reality.

Holding Oil Companies Accountable

Finally, we must demand greater accountability and positive change from the big oil companies that profit from maintaining the status quo. These companies -- and the Washington politicians beholden to them -- must move forward to embrace the challenges we know are ahead of us.

In early September, I called for a "gas price gouging penalty" against oil companies that were exploiting American consumers at the gas pump even before Hurricane Katrina. It violates our basic principle of fair play when major oil companies can gouge consumers -- not only hurting ordinary families, but also harming other businesses that see their own costs go up dramatically.

Just consider: The Big Five oil companies brought in a staggering 33 billion dollars in profits during the three months ending September 30th. Exxon Mobil alone raked in nearly 10 billion dollars. This level of profit is greater than the whole economies of entire nations.

If you saw or read about the recent Senate hearings with oil company top executives, they were unapologetic and unrepentant. They acted offended that they were even asked to explain the conduct of their companies. They seem perfectly satisfied to remain part of the problem rather than become part of the solution.

I'm for free enterprise and the free market. But I'm not for price gouging and market manipulation. There should be more transparency and accountability in oil and gas markets -- and we should demand that oil companies use their exorbitant profits to help invest in our energy future and provide relief for Americans who are contending with high energy prices.

In addition to using gas gouging profits to help pay for renewable energy research, I have proposed using these dollars to strengthen the federal heating assistance fund -- which is so important in cold areas of the country like Minnesota. The leadership in Congress has repeatedly blocked additional heating assistance for the millions of Americans families -- including hundreds of thousands of Minnesotans -- who will need it this winter.

At a time when heating costs are out of control, this program deserves to be fully funded -- and I believe we need to extend coverage and eligibility to help more middle-class families who struggle with these skyrocketing heating costs.

But we also need to look beyond the here-and-now.

Another proposal that's worthy of consideration is asking oil companies to invest a portion of their enormous profits in renewable energy. And if they refuse, they must pay out of their profits into a strategic fund dedicated to supporting further research and development of renewable energy resources and technologies.

Now that's the kind of investment we need to build a better energy future for America.

Energy freedom -- and the transformation of our economy -- are within our grasp. All we need is the determined, visionary leadership to insist that we relentlessly pursue the policies that will get us there.

As the chief prosecutor for Minnesota's largest county, I've always focused on getting real results and getting things done. That's the kind of leader I am.

In Washington, our leaders have not been getting the job done. This year's energy bill contained some important provisions in support of renewable energy, particularly ethanol, but incentives for bold innovation were very modest. Politics-as-usual dominated. And so the incentives for real innovation continue to be very modest compared to the generous subsidies for business-as-usual by the big energy companies. We should expect our leaders in Washington to do better -- much better.

So I'm asking the people of Minnesota to send a message to Washington.

It's time that we demand new energy priorities -- so we can hold the big oil companies accountable ... so we can get much-needed relief to families and businesses who are overwhelmed by high energy prices ... so we can invest in a truly comprehensive energy strategy to promote the homegrown renewable resources needed to secure our energy independence, so we can be spending our energy resources on the farms and businesses in the Midwest, instead of the cartels and the royal families of the Mideast.

The stakes could not be higher.

When it comes to a future of energy independence, what we're really talking about is our freedom:the freedom to grow our economy and jobs without the burden of high oil prices; the freedom to conduct a foreign policy consistent with our American values; the freedom to preserve our lakes, rivers and air without the burden of greenhouse gases and other pollutants; the freedom to preserve and enhance our rural way of life.

As Americans, we're not the kind of people who shrink from a tough challenge -- or who pass up a great opportunity.

And that's what we have here: The challenge to secure our freedom and the opportunity to ensure our prosperity.

With our American "can-do" spirit and a national commitment, I believe we can turn our current energy challenges from a looming crisis into a great success story. And I believe that, as Americans, we can be united in our pursuit of this goal.

We in Minnesota can help lead the way. And we already are. We're at the heart -- the heartland -- of this energy revolution. It's an incredible economic opportunity for the people of Minnesota. We must be prepared to make the most of it.

So let's make sure Washington hears our call to action ... hears our demand for change ... so we get the new energy priorities that will lead to a better and brighter future for all of us, solutions for people, for a change.

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