Project Realism

Richard Nixon's Project Independence goal of making the U.S. self-sufficient in energy by 1980 has always seemed impossibly visionary. Still, planning for the project has gone ahead, only now in an atmosphere of far greater realism. Last week Federal Energy Administrator John Sawhill opened four days of Project Independence hearings in Manhattan by acknowledging candidly that the U.S. will always need to import some oil.

Businessmen and prominent public figures who spoke at the hearings were equally frank. One of the most optimistic predictions came from Thornton Bradshaw, president of Atlantic Richfield, who thought that the U.S. could reduce its dependence on foreign oil from 18% of total energy consumption now "to perhaps as low as 15% by 1980 and possibly 10% to 13% by 1985." Most other speakers, including Sawhill, guessed that the U.S. would be importing 25% of its oil eleven years from now, v. about one third early this year.

Achieving even that degree of self-sufficiency will be staggeringly expensive. Participants in the New York conference estimated that a full-scale effort to spur development of alternate sources of energy, such as nuclear power and oil from shale, and reduce energy demand could cost an astounding $500 billion to $1 trillion over the next ten years. The money would be spent on federal outlays for research and development, subsidies to energy producers and the building of storage tanks to stockpile oil and natural gas. But the dangers of not proceeding are also high. Though U.S. energy supplies and demand are temporarily in balance, Sawhill warned last week that a shortage of natural gas in the Northeast next winter might well force some factories to shut down. The unreliability of foreign petroleum supplies was underlined last week by announcements from Kuwait and Venezuela that they will cut oil production in order to keep prices way, way up.

The Federal Energy Administration has promised to have a "blueprint" for Project Independence on President Ford's desk by Nov. 1, and to introduce a preliminary report by Sept. 30. Actually, the blueprint will not be an action program, but rather a listing of options for debate within Government and eventual White House decision. To facilitate such action, the FEA will spell out in exhaustive detail the economic, environmental and diplomatic consequences of the various options, which it has tentatively grouped into four categories:

> A minimum program consisting of little more than a stand-by allocation and stockpiling plan and efforts to import more oil from the countries least likely to join in an Arab-type embargo.

>-A moderate program of stepped-up but relatively conventional federal action: heavy spending to develop alternate sources of fuel and energy-saving devices, such as low-consumption engines, and formulation of conservation plans for consumers and industry.

> A drastic program of Government action to increase energy supplies, reduce demand or both. Possibilities: production subsidies to energy firms, easing of environmental restraints on offshore drilling and strip mining, price guarantees to the developers of new energy technology, and high taxes on energy consumption.

> An ecologically sensitive program aiming at tough restrictions on such activities as offshore drilling and coal mining, combined with massive efforts to cut energy demand and develop environmentally harmless solar power.

In whatever form such choices are presented to the White House, they will surely touch off a furious national debate. Final decisions may be a long time coming. But at least Project Independence has begun to turn from a mere slogan into a set of proposals.

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