Needed: A bold policy on gas consumption

Enjoy the recent dip in gas prices, because it isn’t here to stay. The roller-coaster ride we’ve been on at the gas pump will continue until the U.S. develops a comprehensive energy plan that includes alternatives to gasoline, energy conservation, vehicle fuel efficiency, and more transparency in the oil markets.

Consumers paid on average around 63 cents more per gallon--about $23 billion more--this past summer compared with the summer before. The high prices reflect our vulnerability to a growing number of influences, including natural disasters, disruptions in supply, higher demand for oil worldwide, and mergers within the petroleum industry.

Yet after a year of soaring gas prices and increasing awareness of the need to reduce carbon emissions, the major piece of energy legislation voted on by Congress called for oil and gas production off our nation’s shores but did not address energy efficiency.

Lack of industry action. Some carmakers have been less than innovative in developing fuel-efficient, alternative-energy technology. Cars and light trucks are the single largest users of oil in the U.S., but their average fuel economy is lower today than it was 20 years ago.

Instead of using technology to gain fuel efficiency, vehicles are designed mainly for fast acceleration and style. Better crash protection has also increased weight. But if automakers designed for fuel economy rather than higher performance, autos could achieve better gas mileage without sacrificing vehicle weight and safety.

Legislative efforts. Two proposals in the U.S. Senate set high but achievable goals. Democratic Senators Dianne Feinstein of California and Richard Durbin of Illinois, and Republican Sen. Olympia Snowe of Maine have called for reforms to Corporate Average Fuel Economy (miles per gallon) standards, and have proposed requiring real-world fuel-economy data to appear on window stickers of new vehicles.

Republican Sen. Richard Lugar of Indiana and Democratic Sen. Barack Obama of Illinois aim to establish a 4 percent annual improvement in fuel efficiency for cars and light trucks. After the 10th year, they estimate we would save 20 billion gallons of gas a year.

Congress should also push alternative fuels to be competitive with gasoline and fund the use of alternative-energy technologies, such as hydrogen, natural gas, and electricity, reducing demand for oil and harmful air pollutants.

A comprehensive policy. This year, oil companies reported record quarterly profits. It’s estimated that they will earn more in 2006 than they did from 1995 to 1999. Clearly, U.S. consumers must make a greater effort to conserve. And U.S. energy policy must consider the fundamental structure of the domestic oil industry and the underlying market forces. Consumers Union recommends:

• Taxing excessive oil-industry profits to fund research, refining capacity, and alternative energy sources.
  
  
• Setting requirements that guarantee an increase in refining and storage capacity to keep adequate stocks on hand.
  
  
• Instituting mechanisms to prevent pricing abuse in the energy markets by monitoring the structure, conduct, and performance of gasoline markets.

The U.S. needs bold legislative and industry action to cut our oil dependence. Anything less means another costly ride on the gas-price roller coaster.