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COMMUNICATIONS

Davis, Hilton, general manager, legislative action, Chamber of Commerce
of the United States, letter to Senator Hansen dated November 8, 1973__
Statement

Oswald, Hon. Robert L., Secretary, Interstate Commerce Commission,
letter to Hon. Paul N. McCloskey, Jr., dated September 7, 1973---
Stafford, Hon. George M., Chairman, Interstate Commerce Commission,
letter to Hon. Warren G. Magnuson dated October 1, 1973----
Train, Hon. Russell E., Administrator, Environmental Protection Agency,
letter to Governor of Florida, Reubin Askew, with enclosures, dated
October 15, 1973_

ADDITIONAL INFORMATION

Fannin, Hon. Paul J., a U.S. Senator from the State of Arizona, "Representative Examples of the Problems in Achieving National Goals Caused by Delay in Implementation of Necessary Projects Because of Problems With Environmental Impact Statements and Other NEPA Requirements"

Kenna, E. Douglas, president, National Association of Manufacturers: "A National Energy Policy”.

"Instruction Manual for Survey of Industrial Energy Consumers”. Nassikas, Hon. John N., Chairman, Federal Power Commission, staff report on "The Potential for Conversion of Oil-Fired and Gas-Fired Electric Generating Units to Use of Coal," September 1973_-.

News release___.

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ENERGY EMERGENCY LEGISLATION

THURSDAY, NOVEMBER 8, 1973

U.S. SENATE,

COMMITTEE ON INTERIOR AND INSULAR AFFAIRS,
Washington, D.C.

The committee met, pursuant to notice, at 9:30 a.m. in room 1202, Dirksen Senate Office Building, Hon. Henry M. Jackson [chairman] presiding.

Present: Senators Jackson, Church, Johnston Abourezk, Fannin, Hansen, Hatfield, Buckley, McClure, Bartlett, Moss, Kennedy, Gravel, Stevens, and Domenici.

Also present: Jerry T. Verkler, staff director; William J. Van Ness, chief counsel; Grenville Garside, special counsel; Richard D. Grundy, F. J. Barnes, Lucille Langlois, professional staff members for the majority; Harrison Loesch, minority counsel; David P. Stang, deputy minority counsel; and W. O. Craft, Jr., professional staff member for the minority.

OPENING STATEMENT OF HON. HENRY M. JACKSON, A U.S. SENATOR FROM THE STATE OF WASHINGTON

The CHAIRMAN. The committee will come to order.

During the last 2 weeks the Committee on Interior and Insular Affairs has been meeting with administration spokesmen to discuss possible legislation to deal with an energy supply shortage of possibly 3 million barrels of oil per day.

The bill under consideration is S. 2589, the National Emergency Petroleum Act of 1973, which was introduced on October 18, 1973.

The bill would establish an emergency program of rationing and contingency planning to deal with critical shortage conditions that cannot be adequately dealt with under existing law. This measure would mandate a program of energy conservation, contingency planning, rationing if necessary, and new initiatives to increase domestic energy supplies.

The bill also authorizes the President to declare fuel shortage emergencies when requirements for energy or petroleum exceed available supply by 5 percent or more.

State and local governments are required to develop emergency fuel shortage contingency programs to be implemented in the event such an emergency is declared.

These contingency programs must devise a priority system for fuel rationing, if necessary, and must provide the capability of reducing energy consumption by 10 percent within 10 days from the date of pro

gram implementation, and by 25 percent within 4 weeks of implementation.

Discretion is left to the State or local government to determine suitable measures for attaining this goal. However, in the event that a State or local government fails to maintain or implement a program, the Federal Government is directed to implement a mandatory energy conservation and contingency program.

Notwithstanding any other State or Federal action, the bill requires the President to expand available supplies of petroleum by

One, requiring oil- and gas-burning powerplants with coalburning capabilities to reconvert to burning coal, and granting temporary variances from air quality emission standards to allow such conversions, if necessary;

Two, authorizing the CAB to grant variances in the schedule of airplane flights, and the ICC in scheduling and routing of trucks and other interstate vehicles, to increase load factors or decrease distances traveled, in order to conserve fuel; and

Three, implementing Federal incentives and subsidies to largely increase the use of public transportation.

Additional domestic supplies are required to be produced from certain designated oil fields technologically capable of producing above their assigned "maximum efficient rate" for sustained periods of time, between 90 and 180 days.

The President is authorized to initiate is authorized to initiate mandatory allocation of crude oil supplies to refineries to assure maximum production capacity and is also required to project future product requirements and to mandate adjustments in refinery product runs accordingly.

The final major provision of the bill provides for the expansion of useful domestic energy supplies by allowing production on the naval petroleum reserves, providing Federal incentives to further expand domestic production and refinery capacity, and, in the longer run, requiring all new stationary powerplants to be equipped for burning coal as well as oil and gas.

It is estimated that this program, when implemented, will save the equivalent of about 3 million barrels of oil a day. These savings would be more than adequate to counter the loss of all imports from Mideast and Arab countries.

Our witnesses this morning are from the administration, and may I point out we have had extended executive sessions on this subject. so the public understands this is not the first meeting.

Based upon previous discussion, it is anticipated that we can arrive at a consensus on a final bill here today. For the purpose of discussion, testimony will be received on S. 2589, the National Emergency Petroleum Act of 1973, as well as S. 2652, the National Coal Conversion Act of 1973, and the President's proposals of last night. We will also include in the record testimony from other interested and affected parties.

[The material referred to above follows:]

93D CONGRESS 1ST SESSION

S. 2589

IN THE SENATE OF THE UNITED STATES

OCTOBER 18, 1973

Mr. JACKSON (for himself, Mr. MAGNUSON, and Mr. RANDOLPH) introduced the following bill; which was read twice and referred to the Committee on Interior and Insular Affairs

A BILL

To authorize and direct the President and State and local governments to develop contingency plans for reducing petroleum consumption, and assuring the continuation of vital public services in the event of emergency fuel shortages or severe dislocations in the Nation's fuel distribution system, and for other purposes.

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Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 3 That this Act may be cited as the "National Emergency

4 Petroleum Act of 1973".

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TITLE I-STATEMENT OF FINDINGS AND

PURPOSES

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SEC. 101. FINDINGS.-The Congress hereby determines

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(a) shortages of crude oil, residual fuel oil, and refined petroleum products caused by inadequate domestic production, environmental constraints, and the unavailability of imports sufficient to satisfy domestic demand, now exist or are imminent;

(b) such shortages have created or will create severe economic dislocations and hardships, including loss of jobs, closing of factories and businesses, reduction of crop plantings and harvesting, and curtailment of vital public services, including the transportation of food and other essential goods;

(c) such hardships and dislocations jeopardize the normal flow of commerce and constitute a critical na

tional energy crisis which is a threat to the public health,

safety, and welfare and can be averted or minimized most

efficiently and effectively through prompt action by the executive branch of Government;

(d) political disruptions in the world petroleum supply and distribution system can be expected to cause supply interruptions of imports from foreign sources;

(e) such supply interruptions will result in shortages far greater than any previously anticipated, and could create extremely critical shortage conditions as a

result of unduly cold weather, reductions in refinery op

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