Perhaps no issue demonstrates the danger that the Republican Party poses to America like that of energy. The GOP grasped the opportunity offered by record oil and gasoline prices to perpetrate another fiction on the American public: that prices are high because the Democrats won’t allow drilling on our own lands and waters, and that opening up areas currently off limits will cause prices to drop. Behind this claim is a simpler one: that drilling in more areas will lower prices. How do the Republicans know this? The answer is also simple: they don’t.

No one knows just how much oil lies under the unexplored parts of the U.S. Outer Continental Shelf (OCS) in the lower 48 states that have been under a moratorium. There are estimates from the Interior Department’s Minerals Management Service of 17.84 billion barrels of oil and 76.47 trillion cubic feet of natural gas to be technically recoverable in the areas currently off limits. For some context on these numbers, the U.S. consumes about 20 million barrels of oil and 60 billion cubic feet of natural gas per day. That works out to about 7 billion barrels of oil and 21.9 trillion cubic feet of natural gas consumed in the U.S. per year.

The U.S. Department of Energy’s Energy Information Administration (EIA) has stated that opening up the OCS areas or the Arctic National Wildlife Refuge (ANWR) will not significantly affect oil and gasoline prices. In regards to the OCS areas under moratorium, the EIA states that “access to the Pacific, Atlantic, and eastern Gulf regions would not have a significant impact on domestic crude oil and natural production or prices before 2030… Because oil prices are determined on the international market, however, any impact on average wellhead prices is expected to be insignificant…. the average field size in the Pacific and Atlantic regions tends to be smaller than the average in the Gulf of Mexico, implying that a significant portion of the additional resource would not be economically attractive to develop…”4 (emphasis added)

These uncertainties from the Bush administration’s own agencies have not prevented the GOP from launching yet another disinformation campaign to mislead the public about a complex issue. John McCain, who knows better, has adopted this sham policy, telling the public that if only more drilling occurs, prices will automatically go down. Democrats as a party are not opposed to all new drilling or to expanding domestic energy production (see the amendment to a recent Senate energy bill given below.) They are, however, committed to being honest with the public about the realities of the different energy options (see the numbers above.) The Democrats are following a responsible policy – which serves the public far better, but can sound less impressive, than the GOP’s dishonest sound bites.

A new proposal has come from Senator Mary Landrieu and 9 other Senators in a bipartisan compromise bill – the “New Energy Reform Act of 2008” – which would open some areas of the OCS now under moratorium and use resulting federal revenues to fund alternative energy development.

This proposal would:

• Open additional drilling areas in the eastern Gulf of Mexico, and allows Virginia, North Carolina, South Carolina and Georgia to elect to permit drilling in deep water sections off their coasts. Existing bans on drilling off the West Coast, and in the ANWR, would be preserved.
• Dedicate $20 billion to R&D on alternative fuels for motor vehicles.
• Extend a series of tax credits and incentives, such as for the purchase of hybrid vehicles.
• Fund the above — at total cost of about $84 billion — by closing tax loopholes for petroleum companies, in conjunction with licensing fees.