Ex-N.J. Gov.: Americans are in denial on energy
Christine Todd Whitman says too many options get ruled out, while T. Boone Pickens urges natural-gas legislation.
NEW YORK (Fortune) -- When politicians and businesspeople get together to discuss energy policy, it's usually the politicians who talk like dreamers and the private-sector folks trying to inject a little cold, hard realism into the conversation.
But the tables were somewhat turned today when former EPA administrator and New Jersey Gov. Christine Todd Whitman and oilman-turned-wind-investor T. Boone Pickens both argued that the U.S. needs to invest in renewables and expand domestic energy production. And it was Whitman who warned that the American public doesn't yet appreciate the costs involved. Their comments came at an economic discussion sponsored by Time Warner (TWX, Fortune 500), the parent company of Fortune and CNNMoney.com.
"If we get a cap on carbon, everything is going to be more expensive," said Whitman, who nevertheless supports the cap-and-trade legislation moving through Congress to cut greenhouse-gas emissions. She also urged policy makers to undertake an education campaign to overcome public opposition to new energy infrastructure like electric transmission lines, nuclear-power plants and even natural-gas pipelines: "Siting natural gas pipelines, getting the natural gas to the infrastructure, is a huge, huge problem."
Pickens, who spent millions last year promoting his "Pickens Plan" to reduce U.S. dependency on foreign oil by switching to wind and natural gas, seemed a bit taken aback. "But Christie, natural gas is the most widely distributed [energy] resource in America -- it's down every street and up every alley," Pickens said.
"I've been on the other side of that as a governor," replied Whitman, now co-chair of the nuclear-energy advocacy group Clean and Safe Energy Coalition. "They were trying to locate a pipeline, and if you want to see pushback... It's like nuclear. We transport nuclear [material] all over the country, and yet because people know about it from The Simpsons, they're scared to death."
Whitman says that when it comes to energy, Americans are "very good at saying no" to too many options. "We don't want to import foreign oil for a whole host of reasons. We don't want coal because it's dirty. Natural gas, we don't want a pipeline anywhere near us because it might explode or something. We won't talk about nuclear. Even the environmentalists get upset with wind power at times because it's visual pollution and because birds don't look the same coming out of a windmill as they do going into it."
"We have got to get over this no, no, no and say we are developing new technologies, we're getting smarter about how we're doing it, it's going to take a mix of energies, and we're all going to have to be part of it," Whitman said.
Asked about the cap-and-trade bill, Whitman expressed support but urged lawmakers to give special considerations to companies that have already been leaders in reducing CO2 emissions. "If they don't get credit for that," she said, "we're going to put ourselves at a huge disadvantage with some of the biggest Fortune 500 companies because they'll all of a sudden have to get to the new levels off their already vastly reduced base."
For his part, Pickens says he's optimistic that Congress will pass some version of what is now House Resolution 1835 after the summer recess. The bill would provide tax credits for natural gas-based transportation fuels and for the production of vehicles that run on natural gas. The legislation would also require that by 2014, 50% of all new vehicles purchased or leased by the U.S. government be capable of operating on compressed or liquefied natural gas.
"Natural gas is the only resource we have in America that can reduce our dependence on foreign oil," said Pickens. "I think we're going to get an energy bill this year that we've never seen in American history."
When asked where he thinks oil and natural gas prices -- now $70 a barrel and $4.20 per 1,000 cubic feet, respectively -- are headed, Pickens said higher. "I'm long oil. I'm long natural gas," he said. "The price has to go up."