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AFRICAN AMERICAN ENVIRONMENTALIST ASSOCIATION

What A Good Energy Policy Means For Blacks

A good energy policy for blacks would guarantee abundant supplies and low prices. Of course, traditional environmentalists and oil companies want high energy prices, the former to promote conservation, the latter to increase profits and exploration. Unfortunately, blacks do not control any aspect of energy supply and have little control over establishing energy policy. Blacks, except for one company, do not own the oil, gas, coal, electricity, gas pipelines, electricity transmission lines, refineries, tankers, oil fields, outer continental shelf drilling platforms, power plants, or oil, gas and utility companies that distribute energy in the United States. Blacks, who make up 13% of the American population, also do not exert influence from the demand side of energy use. We do not own, distribute nor use energy to our advantage. Blacks must utilize energy policy to become owners and suppliers of energy.

In 1986 a black entrepreneur from Nigeria started a company that later entered the oil and gas exploration business. CAMAC, a multinational oil and gas exploration company led by CEO Kase Lawal, left, as its 2006 Company of the Year. This is the first black-owned company to significantly participate in the energy sector. CAMAC is the number two company on the BE 100 list with $1.5 billion in sales. CAMAC partners with Conoco and Chevron for big offshore projects. In 2005, CAMAC acquired a controlling interest in Unity National Bank, the only black-owned federally chartered bank in Texas. Mr. Lawal is Nigerian born and raised. He received a B.A. in chemical engineering from Texas Southern University and an M.B.A. in finance and marketing from Prairie View A&M. He worked at Shell, Halliburton, Suncrest Investment Corp and Baker Investments before forming his own company. In June 1999, he was appointed by the city of Houston to serve as a commissioner on the Port of Houston Authority Board. He also serves on the board of directors of the Houston Airport System Development Corporation.

America's energy policies are currently being formulated in national energy legislation pending in the U.S. Congress. Bills have passed in the U.S. House of Representatives and U.S. Senate in 2002 and 2003. Unfortunately, the bills have died in Conference Committees each year. Major impediments have included ethanol subsidies, MTBE (Methyl Tertiary Butyl Ether) liability waivers and procedural issues--Democrats were left out of drafting the final Conference Committee bill. Another controversial issue, drilling in the Arctic National Wildlife Reserve (ANWR), was taken out of the final bill by the Republicans because they knew the bill would not pass in the Senate with that provision. The House legislation approved drilling in the Arctic National Wildlife Refuge; the 2002 Senate bill did not. Ninety-two percent (92%) of the CBC opposed ANWR drilling.  Three members of the Congressional Black Caucus opposed the Markey Amendment to the energy bill and supported drilling in ANWR: 1) Bishop (Ga), 2) Clyburn (SC), & 3) Thompson (MS). Last year, four CBC members supported ANWR: 1) Clyburn (SC), 2) Earl F. Hilliard (AL), 3) Bennie Thompson (MS), & 4) Edolphus Towns (NY).

An energy bill passed both chambers in 2003 but died in Conference Committee. Senate leadership agreed to replace their 2003 energy bill (S 14) with the 2002 energy bill (H.R.6). Senator Pete Domenici, Chairman of the Senate Energy & Natural Resources Committee, openly stated that he and Billy Tauzin, Chairman of the House Energy & Commerce Committee, would rewrite the bill to their satisfaction. Democrat Conferees disliked the take it or leave it approach and they had one week to review and vote on the 1,700 page bill before the Thanksgiving Congressional adjournment. Interestingly, 28 members of the 39 member Congressional Black Caucus (CBC) signed a joint letter in support of final action on the energy bill in 2003.

But the CBC did not support the energy bill--84% of the Congressional Black Caucus voted against H.R. 6, the Energy Policy Act of 2003. Six members of the CBC voted for the Administration bill sponsored by Energy and Commerce Chairman Billy Tauzin in the initial floor vote: 1) Bishop GA), 2) Jackson-Lee (TX), 3) Jefferson (LA), 4) Bernice-Johnson (TX), 5) Rush (IL), & 6) Scott (GA). Only Bishop voted for the energy bill and for ANWR drilling (dropped in Conference Committee). The Congressional Black Caucus also opposed the Conference Report to the Energy Bill (H.R. 6) by a vote of 8 yeas and 29 Nays. Seventy-two (72) percent of the CBC opposed the report.  Voting for the bill: 1) Davis (IL), 2) Jefferson (LA), 3) Meek (FL), 4) Towns (NY), 5) Bishop (GA), 6) Thompson (MS),  7) Scott (GA) & 8) Wynn (MD).  Only Jefferson (LA) and Scott (GA) and Bishop (GA) voted Yea on both votes. The House vote on the Conference Report was 246 Yeas to 180 Nays. The Energy Conference Report died in the Senate because of the opposition filibuster. The U.S. Senate failed to "Invoke Cloture," which ends a filibuster and cuts off debate, so that members could vote on the energy bill. The vote was 58 to 40. It takes 60 votes to stop a filibuster.

An energy bill also passed both chambers in 2002 but died in Conference Committee. In 2002, the House bill was considered to be the Republican bill (House controlled by Republicans) and the Senate bill (Daschle/Bingaman) was considered to be the Democrat bill (Senate controlled by Democrats until Jeffords became an Independent tipping the balance to the Dems). In 2002, twenty-five percent (25%) [8 of 36 + J.C. Watts] of America's black Congressional representatives voted to approve the 2002 energy bill, HR 4-- the Bush/Cheney Securing America's Future Energy (SAFE) Act. Support dropped to 16% in 2003 [6 0f 39]. The CBC supporters in 2002 included: 1) Bishop (GA), 2) Brown (Fla), 3) Clyburn (SC), 4) Hilliard (Ala), 5) Jackson-Lee (TX), 6) Jefferson (LA), 7) Thompson (MS), 8) Towns (NY) and non-CBC black Republican Watts (OK). Clearly, African Americans have different viewpoints on energy policy. The CBC supporters in 2003 included: 1) Bishop (GA), 2) Jackson-Lee (TX), 3) Jefferson (LA), 4) Bernice-Johnson, 5) Rush (IL), & 6) Scott (GA).

Five members of the CBC broke ranks in 2002 to support drilling in the Arctic National Wildlife Refuge on the grounds that it would create thousands of jobs. The Democratic leadership, Dick Gephardt, (Missouri), minority leader and David E. Bonior (D-Mich), minority whip, joined the CBC members listed below in opposing increases in automobile fuel efficiency standards in the bill. Representatives Bennie Thompson of Mississippi, Edolphus Towns of New York, Earl F. Hilliard of Alabama and James E. Clyburn of South Carolina were among Mr. Bush's supporters for drilling and against increased car mileage standards.

How are the House and Senate energy bills advantageous to blacks? The bills are advantageous to the extent that they promote adequate supplies of energy, low energy prices, efficient use of our planet's natural resources, safety and environmental protection. The House bill had several provisions, subsidies and incentives for energy efficiency and automobile fuel economy standards. The Senate energy bill aggressively addressed exploration, production and supply. Both bills address conservation but Democrats were adamant about excluding the Alaskan Arctic National Wildlife Reserve from oil exploration and production. A compromise will probably produce a decent energy bill. Almost any coherent national energy policy will be beneficial to the nation and the black community.

The real action for African Americans in energy policy is not included in the national energy bills. Electricity deregulation has real opportunities for blacks to gain access to ownership and significant participation in the energy business. Although deregulation was botched in California -- they did not really deregulate and partial deregulation combined with an insufficient number of electricity generating plants, led to significant market imperfections and opportunistic price gouging by suppliers, appropriately implemented, it provides an avenue for increased participation in the energy sector for blacks.. African Americans should aggressively participate in the proposed regional transmission organizations (RTOs), which will ultimately control electricity power sharing all over the country. And even in states and regions that do not accept RTOs, deregulation will still provide unique opportunities. The U.S. Federal Energy Regulatory Commission is pressuring states and electric power companies to form RTOs.

Energy policy directly affects the environment, particularly our atmosphere. There is a general consensus in the scientific community that global warming and global climate change due to manmade influences are real. Moreover, it simply makes sense that we cannot continue to dump limitless emissions into our atmosphere without serious negative consequences. Asthma appears to be rising with these changes in our atmosphere. AAEA believes that summer smog is the single worst factor, behind cigarette smoking, in creating respiratory problems in the United States. Rush hour traffic creates these dirty air (nonattainment) days. You can see the air in every major American city during summer months. The 200 million cars and trucks we drive each day are creating unhealthy and even deadly conditions for about 150 million Americans. The great benefit to America is that rush hour literally drives our economy. We can't stop rush hour. We can, however, change the hydrocarbon-based pollution coming from the tailpipes of our vehicles.

America uses 18 million barrels of oil every single day. About half of that comes from imports. A significant portion of our imports comes from the Middle East. Although we have about 550 million barrels of oil in our Strategic Petroleum Reserve (underground in Texas and Louisiana), a supply disruption from OPEC and Arab nations would cripple America in a few months. We would use our military to secure the oil we need. This could lead to a global war over oil (World War II started for the same reason). America could be faced with nuclear strikes on its own soil in such a conflict. We are currently threatened with biological, chemical and other forms of attack.

Are there reasonable, profitable ways to clean the air, reduce our dependence on foreign oil and promote industrial development and entrepreneurial opportunities for blacks? The manufacture and comprehensive market penetration of electric vehicles, combined with nuclear-powered electricity supply, are the solutions. It is generally accepted in the scientific community that if America retrofitted to hybrid and all electric vehicles, pollution from hydrocarbon-fueled electric power plants would virtually neutralize the clean air benefits. Nuclear power has safely provided about 1/4th of our national electricity requirements for the past two decades. New, modular nuclear power plants can safely provide the electricity for the electric cars we need to clean the air and reduce our dependence on imported oil. Blacks should look to these new industries to become industrialists.

AAEA is aware of the extreme public fear and misconceptions about nuclear power. The biggest misconception is that these plants can blow up like nuclear warheads. They cannot and have not. The other misconception is that radiation releases pose an unacceptable risk to the public. We submit that this risk is no greater than the risk of transporting gasoline and other hazardous substances in trucks all over the U.S. every day to supply our vehicles, homes and businesses. Tons of hazardous materials ride the highways in 18-wheelers. An estimated 125,000 hazmat trucks roll every day, according to the National Tank Truck Carriers Inc. At least 45,000 of those are gasoline tanker trucks with an average 8,700 gallons on board.

We are in a new America and converting from a petroleum-based economy to an electricity-based economy will enhance our national security. Oil will remain crucial to our overall economy, but it will not be an Achilles Heel in terms of our health and national security. Such a conversion will provide numerous opportunities for African American entrepreneurship. After years of considering and studying nuclear power, it is our opinion that this technology can be operated safely and provides an almost inexhaustible source of power for America. New designs and streamlined procedures should be enacted immediately so that our nation can reap the benefits of this technology. Subsidies for promoting nuclear power should be linked directly to subsidies (dollar-for-dollar) for solar and wind power so that these other viable alternative technologies can also be utilized to maximum advantage. Such a policy would greatly increase opportunities for blacks to participate in energy sector ownership.

The sale, purchase and construction of long-distance electricity transmission lines are other important areas for black ownership and participation. America needs a new, national utility grid similar to our national highway systems that can effectively and efficiently distribute electricity where it is needed without the bottlenecks of the current, inadequate system. Blacks should participate in the construction, ownership, control and regulation of significant portions of these transmission lines.

States have required utilities to sell their generating plants in exchange for deregulation of the industry. These utilities have retained the administration and distribution at the local level in exchange for being allowed to invest in other commercial areas, such as telecommunications. This provides an excellent opportunity for blacks to gain market share. To the extent that smaller generating plants are competitive in a deregulated market, it provides an opportunity for smaller scale minority entrepreneurs to participate in the industry.

Many blacks working in the energy industry are represented by the American Association of Blacks in Energy (AABE). These blacks employed by the major energy companies, combined with blacks with significant investment dollars, can aggressively participate in energy delivery. Blacks are big consumers of energy. We should also be big producers of energy.

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