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about doing anything that would implement the Kyoto treaty. We're not supposed to think in any way, shape or manner about having any meetings to elicit more information so that we can make intelligent decisions in the future. So I would hope all of you would as individuals and as professionals would be unalterably opposed to that approach.

Mr. Chairman, if Mr. Geller could response to my original question, I would appreciate it. I thank you for your indulgence.

Chairman SENSENBRENNER. The gentleman from New York is getting something that no other member of the Committee has. But because he is so special, he can go ahead.

Mr. BOEHLERT. Thank you, Mr. Chairman. I appreciate that indulgence.

Mr. GELLER. Thank you. In response to your question I would support a comprehensive approach be taken in terms of policies, including reasonable efficiency standards, but certainly not limited to energy efficiency standards. I think that the strategy ought to include additional funding for research and development on these innovative clean technologies. I note in my testimony the PCAST report from a year ago. I just want to read one sentence that I quote: "R&D investments in energy efficiency are the most cost effective way to simultaneously reduce the risks of climate change, oil import interruption, and local air pollution, and to improve the productivity of the economy." That is the President's Committee of Advisors on Science and Technology, November 1997. They recommend doubling federal support for R&D on energy efficiency over about a 5-year period.

I think that the kinds of tax incentives that the Administration has put forward, very targeted tax incentives on advanced technologies, cars that are twice as efficient or three times as efficient as currently produced vehicles, super efficient new homes, appliances, and so forth. Those kinds of incentives make a lot of sense to help stimulate the introduction of these advanced technologies, to move them from the laboratory into the marketplace and help reduce the risk for being innovative and trying out these technologies.

I also support market incentives for consumers so that they are given incentives. It can be a price, energy price incentive. But there's also fees and rebates that one can envision. We do have gas guzzler taxes in place today on very inefficient vehicles. That kind of policy can be expanded to fees and rebates that's revenue neutral for all vehicles that give consumers an incentive through the price signal and last but not least, reasonable cost effective efficiency standards that can be good for consumers, can have net economic benefits, and reduce pollution of all types, not just global warming emissions.

Chairman SENSENBRENNER. The gentlewoman from Texas, Ms. Jackson Lee.

Ms. JACKSON LEE. Thank you, Mr. Chairman. Thank you for holding this hearing today. I appreciate the witnesses appearance. This is a timely hearing in light of the fact that we have seen over the past weeks American businesses and industry groups have launched a media campaign urging us not to implement the provisions of the Protocol. So the study is important. I thank the EIA

for looking at this issue and analyzing the different impacts that it may have or how the approaches may have different impacts on the industry.

I would like to simply say that in spite of all that we are now doing, it certainly is important that the Protocol was both discussed and presented. I would venture to say that we all could at least come to one consensus, that there are problems in the environment. I would like to pose my question to Mr. Geller.

THE KYOTO PROTOCOL AND ENVIRONMENTAL PROBLEMS THAT NEED IMPROVEMENT

Ms. JACKSON-LEE. Would you concede the point that we have problems with the environment, environmental qualities that need improving?

Mr. GELLER. Certainly.

Ms. JACKSON-LEE. With this Protocol as a backdrop, and obviously to have an international protocol, it has to respond to the concerns of many nations and not just one nation, which happens to be the United States. I think you have answered some of my concerns by your comments to my good friend from New York, and I want to associate myself with his remarks, but give us some next steps. Would you suggest that we take the Protocol and throw it immediately to the wind or the trash, or can we find some common ground that reemphasizes the value of a good environment, a clean environment, along with the needs of our small businesses and our American industries?

Mr. GELLER. I think we can by implementing the Protocol, approving the Protocol, and complying with it, I think we can take actions that make sense for a whole host of reasons in this country that will improve the energy efficiency of our appliances, our homes, our office buildings, our factories and our vehicles, plus the introduction of cleaner solar energy, wind energy, bio energy sources, some shifting from carbon intensive energy sources like coal, to less carbon intensive sources like natural gas. I think we can do this and comply with the Protocol in this initial period of 2008 to 2012, and do it in ways that address the whole host of environmental problems that we have, that can make our cities, the air in our cities cleaner, the acid rain problem less of a problem, reduce toxic emissions that some cases result from production and use of energy. We can do this in ways that benefit consumers and businesses. There is an investment cost, but as Dr. Hakes has noted and I have noted, there is energy savings from the more efficient products.

I think that by doing this in ways that benefit the United States, we will also set the example to bring in the developing countries in a meaningful way, that they see us as the richest nation in the world with a lot of inefficiency and waste. I think if we're not going to set the example, then it's really pretty hopeless for getting them to come in in a meaningful way.

I have actually lived for 5 years in developing countries, mostly in India and Brazil, and for a limited period of time in Africa. I have lived in villages in India under a Fulbright Fellowship about 20 years ago and I think that to ask these countries and the major

terns of energy use and inefficiency that we have here, is simply ludicrous. So we get our own house in order and benefit the United States. Then we can bring in these other countries.

Ms. JACKSON LEE. Mr. Chairman, I have and I thank you for your answer. I have a statement that I would like to ask unanimous consent to put in the record.

Chairman SENSENBRENNER. Without objection.

Ms. JACKSON LEE. And simply say to Mr. Geller that with my constituents that I represent in the energy industry, I know years ago in the Clean Air Act we asked for some scientific and technological research to be done or implementation to make the product cleaner. It was done, and I don't think that we have lost a sizeable amount in terms of the value of that industry. So you see that it could be compatible if we do this right with a thriving economy and thriving industries that we have?

Mr. GELLER. Certainly.

Ms. JACKSON LEE. Thank you.

Chairman SENSENBRENNER. The gentlewoman's time has expired.

The gentleman from California.

Mr. BROWN of California. Along the same line, Mr. Chairman, I ask unanimous consent to have the record include the charts to which I referred in my questions to Dr. Hakes.

Chairman SENSENBRENNER. Without objection, they will be included in the proper part of the record.

If there is no further business to come before the Committee, this hearing is adjourned.

[Whereupon, at 12:30 p.m., the hearing was adjourned.]

APPENDIX 1: Answers to Post-Hearing Questions Submitted by Members

COMMITTEE ON SCIENCE

U.S. HOUSE OF REPRESENTATIVES

Hearing

on

The Road from Kyoto-Part 4:

The Kyoto Protocol's Impacts on U.S. Energy Markets and Economic Activity

October 9, 1998

Post-Hearing Questions Submitted to

The Honorable Jay E. Hakes
Administrator

Energy Information Administration
U.S. Department of Energy

Questions Submitted by Chairman F. James Sensenbrenner, Jr.

Impact on GDP in 2010

Q1.

Al.

At the bottom of page 6 of your testimony, you say that “In 2010, EIA estimates that the Gross Domestic Product will be $13 to $397 billion (in $1992) smaller than in the reference case depending on the severity of the carbon target costs and amount of transaction costs”. Isn't it true that in terms of actual GDP impact, as shown in Table ES5 of the main document, it will be $60 billion to $397 billion?

Yes, in terms of actual GDP the projected range is $60 billion to $397 billion (1992 dollars). The range of impacts for potential GDP is from $13 billion to $72 billion. The actual GDP is better at capturing the near-term transitional effects of implementing a particular policy, while the potential GDP is generally considered a more appropriate measure of the effect on the long-term position of the economy. Dr. Hakes, in his testimony, reported the range of potential and actual GDP.

Reasons for Differences Between EIA's and Administration's Analyses of the Kyoto Protocol

Q2. What are the reasons for the significant differences between the EIA's and the Administration's analyses of the Kyoto Protocol?

A2

The Administration's estimate provided by the Council of Economic Advisers (CEA) of the costs of implementing the Kyoto Protocol was based, to a large extent, on an analysis of the results of the Second Generation Model developed by the Pacific Northwest

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