News Analysis

 

 

But offers no relief for summer-giving Democrats a bone to pick.

President Bush's national energy policy, released May 17, takes a comprehensive long-term approach, by mixing conservation and green power incentives with plans to expand fossil fuel production and construction of new power plants. In spite of that mix, however, the proposal promises to have its critics-from both inside and outside Washington.

Dwight Allen, communications and utilities director, at Deloitte Research, suggests that in some ways the Bush proposal may be on target, but warns that the President faces an uphill battle to turn some of them into reality.

"I think Bush has a tremendous challenge ahead of him in getting his package approved," says Allen. Thomas E. Capps, chairman and CEO of Dominion, offered comments in the same vein: "The administration is saying the right things. Now we've got to see if it has the political will."

The Bush plan talks of a "national grid," calling on the secretary of energy to examine the benefits of such a concept by Dec. 31, and to identify transmission bottlenecks and the measures needed to remove them. The plan also calls for legislation to develop such a national transmission grid, in part by granting authority to the government under the doctrine of eminent domain to gain rights-of-way for transmission lines, similar to current rights-of-way authority for the construction of natural gas pipelines. According to Allen, some of those initiatives go against the grain of the Republican ideal of decentralized government, a factor that may play to Bush's disadvantage within his own party. State governments, for instance, used to having control over many of these issues, might question such policies.

"His case doesn't have a clear focus to it," said Allen.

The free-market CATO Institute, meanwhile, has come out criticizing the proposal's emphasis on building new power plants. CATO Institute director of natural resource studies Jerry Taylor points out that the United States already "is currently experiencing a power plant construction boom," without any Bush Administration push for new plants. Let supply and demand dynamics solve the problems, says Taylor.

"It would certainly seem to be the case that there is a considerable amount of new construction that's going to be completed in the next 18 months or two years," agreed Allen. "But it's not the case that if you just sit back and let nature take its course and let that capacity come online, then it will necessarily cure the whole problem. I think it will reduce the urgency to some extent. But there are a number of other issues [such as] gaps and capacity constraints in transmission networks."

Public perceptions create another potential political hurdle, says Allen. As he puts it, the extent to which Americans are aware of any "energy crisis" stems largely from their familiarity with power problems out West. Those are near-term problems, while the proposal addresses long-term problems. And that plays perfectly into the hands of Democrats, he warns.

"I think what Bush is trying to do is come up with a program for improving