www.komotv.com March 12, 2003 By KOMO Staff & News Services

OLYMPIA - With some gas prices topping $2 a gallon and no relief in sight, some state lawmakers want to give drivers more options at the pump.

The state House passed a package of bills on Tuesday that would give tax breaks to encourage the production and use of biodiesel, an environmentally friendly fuel that can be used in any diesel engine.

Now just a few places in Washington state sell biodiesel fuel, and it retails between $2.75 and $3.25 a gallon, compared to an average price of $2.03 per gallon for regular diesel. But lawmakers and biodiesel fans believe prices will drop if Washington can attract biodiesel manufacturers to the state.

"As the price of petroleum goes up, the price of this product will go down as we get into production," said Rep. Brian Sullivan, D-Mukilteo, who sponsored the biodiesel bills. He said in Minnesota, where some biodiesel production plants are located, the fuel costs $1.80 a gallon.

Biodiesel can be made from soybeans, oilseed crops such as mustard seed, recycled vegetable oil or even used restaurant grease. Using biodiesel instead of petroleum in cars reduces carbon monoxide by about 40 percent over regular diesel, according to the U.S. Department of Energy, and cuts air toxins by 60 percent to 90 percent.

Duane Heier runs his tractor on biodiesel at the Steamboat Island Nursery near Olympia. He likes the environmental benefits and the "much less noxious" smell of biodiesel fumes. When he starts up the tractor, he said, "it smells sort of like the back of McDonald's."

Heier can afford biodiesel because he only uses about 10 gallons a month. "Less expensive would be great," he said.

Heier buys his biodiesel from Neil Falkenburg, who sells it at the West Bay Marina in Olympia. Falkenburg has used the fuel in his 1998 Dodge Ram pickup, and said while 100 percent biodiesel seems to give him a little less power, the engine runs quieter and the exhaust smells "by far more pleasant." He usually uses a mix of biodiesel and petroleum diesel.

Falkenburg said his biodiesel business has grown steadily since he started a year ago; he has about 20 regular customers.

"Once they get started on it, they're hooked," he said. Some customers bought new diesel Volkswagens just so they could use the special fuel, he said. In a car that gets 40 or 50 miles to the gallon, biodiesel starts to make economic sense as well as appealing to environmentalists.

Beside the environmental benefit, Sullivan pushed the biodiesel bills as ways to stimulate the rural economy. Washington farmers can grow the ingredients for biodiesel, and attracting biodiesel manufacturers to the state could create much-needed jobs in depressed rural areas.

House Bills 1240, 1241, 1242 and 1243 would create tax breaks for biodiesel makers and sellers in Washington, encourage state agencies to use biodiesel fuel, and start a pilot project for using biodiesel in school buses. A handful of Republican lawmakers opposed the bills, saying state government shouldn't meddle with free market competition.

"If a product is good it will rise to the top," said Rep. Lois McMahan, R-Olalla.

Bill supporters said biodiesel can and will succeed on the free market - but the Legislature can make sure it happens in Washington by giving biodiesel manufacturers tax incentives to set up shop here. Sullivan mentioned Airway Heights, outside of Spokane, as one possible biodiesel plant site.

"Do we want to lay the groundwork to have this be the center of biodiesel production on the West Coast?" asked Rep. Jeff Morris, D-Anacortes, who supported the bill.

Petroleum diesel cost an average of $2.03 a gallon in Washington on Tuesday, according to AAA, while a gallon of regular unleaded gas cost $1.85 - up from an average of $1.18 a year ago and $1.52 a month ago.

A few hours before the House passed Sullivan's biodiesel bills, lawmakers were grilling oil industry representatives at a hearing on high gasoline prices.

"It seems to my constituents out there that you are taking advantage of increased war talk to increase your prices," said Rep. Laura Ruderman, D-Kirkland. "It doesn't seem reasonable."

Anita Mangels, a spokeswoman for the Western States Petroleum Association, said rising prices were driven by high crude oil prices, in turn driven by jitters about war in Iraq and political instability that virtually shut down oil production in Venezuela.

"Unfortunately, the petroleum industry is incredibly sensitive to global conditions," Mangels said. "It's the market. It's always the market. It's economics 101."

For More Information:

Look Up Bills' Text -- www.leg.wa.gov Dr. Dan's Alternative Fuel Werks, Seattle-based biodiesel retailer: www.fuelwerks.com

www.energypulse.net 3.13.03   David Marvin Regen Jr., Marketing Director, Energy Systems, Inc.

More Articles By This Author It is time, once again, to pit American ingenuity and resolve against outmoded ways of living which have left our shores vulnerable. We are rapidly reaching the limits of our energy supplies and more world conflict will surely revolve around this issue. We speak of funding terrorism through energy dependency, but here is the irony. We have had solutions in our midst for decades. Many a direct result of our historic investment in the space program. A larger understanding shows that public policy should reflect the connection between energy, environment, economics, and national security. Most importantly, we have a profound opportunity to shape a better future at the local level, by insisting on energy accountability in building contracts for public construction.

The United States has had the technology and engineering standards necessary to design and build super energy efficient buildings since the early days of the space program. If we had transferred what we learned then to the realm of building energy performance as an industry standard practice, our general state of affairs could be much different. There might be no energy crisis because twice as many homes and three times as many commercial buildings could be operating off the same electrical supply. Or conversely, each 10,000 square feet could reduce coal burning by 100 tons per year from the amount now burned to create the electricity to condition that same space. These may sound like outrageous claims, but all conclusions are based on commercial buildings that have existed for years and utility bills of record. But first lets look at a history of near misses in trying to bring energy accountability to the American people.

Apollo and the Oil Embargo were the first harbingers of modern self-sustainable architecture for all. During that time, President Jimmy Carter directed the Department of Energy to create better standards for energy performance in new buildings. These long forgotten programs could have been an ideal marriage of public policy with the needed supporting technology. But energy accountability as standard practice was never adopted in the private sector and we now are faced with all the same problems thirty years later but worse. After Carter was gone and with no oil crisis, later administrations failed to see the strategic importance of these programs. America missed an historic opportunity to bring energy accountability to this industry. As a result, commercial buildings erected in the last three decades use at least four times more energy to heat and cool because advanced energy performance initiatives were never implemented.

Once we embrace energy accountability, it returns billions of dollars to the economy and eliminates billions of tons of air pollution. The challenge is how to replace "prescriptive standards" used for specifications on insulating, heating and cooling of a building with "performance engineering standards" from the aerospace industry. Robert Southerlan, an aerospace engineer during the Apollo years, accomplished these decades ago. His engineering approach to energy efficient buildings was the model adopted by the TVA program known as “Watt Count” for Residential Homes. "Spin-Off" magazine, a NASA publication, recognized Watt Count for its achievements in energy accountability in 1981.

If TVA had ever instituted a Watt Count for Commercial Buildings, the Southeast might be a much different place. What if TVA had helped build several thousand super energy efficient commercial buildings during the 1980's? They would have come under intense scrutiny as the performance data generated by the accountants was shared with the executive decision-makers in the boardroom. Local Governments and School Boards would have seen that certain buildings and schools operated at half the cost. Commercial Real Estate executives would have seen that certain buildings generated twice the profit per square foot of other buildings in their portfolio. This information would have been there to bug these people year after year with each subsequent report. Any discussion of budget crunches or income taxes would serve as another painful reminder. This could have started a new mandate from the consumer.

The main market barrier to energy efficiency is how the low bid process works in the awarding of a building contract. The low bid system virtually guarantees higher operational costs and therefore a more expensive building to own over time. It is impossible to determine the true cost of owning a building unless capital cost for construction is combined with projected operating costs. This is something the industry is not accustomed to doing and those letting contracts are not accustomed to asking for, yet most states have laws encouraging them to do so. All future public-building contracts should be required by law to include an energy accountability specification in the bid. This is where self-sufficiency must start.

To gain market acceptance over doing something a little different, Bob Southerlan also saw the need to guarantee the energy use of a building to the owner before construction. If building energy use is more than 10% over the projected figures, a warranty bond pays the difference. His designs consistently exceed specifications, in part, because he is in control of both insulation and mechanical design. This holistic approach to building design was trademarked as the Synergy System by his company Energy Systems, Inc. It makes evaluating the thermodynamics of a building and accurately predicting its energy use much easier. This is the first step for super energy efficient building design. Quality control and oversight procedures used by general contractors and engineers ensure that mechanical & insulation subcontractors follow the architect’s specialized installation specifications. Other obstacles to energy efficiency are antiquated building codes, which are now decades behind the available technology. Codes stifle and prevent full utilization of products and methods that could dramatically lower energy use. Yet, there are still cases of significant gains in energy performance. These are two examples:

The 640 Spence Lane Office Building is a 20,000-sq./ft commercial building in Nashville, TN. It has used less than $100 of natural gas to heat the building each year for the last two decades. It was the focal point of a "comparative energy use study" by TVA with 13 other area office buildings of same approximate size and use in 1984. It received a National Award for Energy Innovation from the DOE. It also received a first place prize from ASHRAE, (American Society of Heating, Refrigeration & Air-conditioning Engineers), in their national energy awards competition as a commercial building entry. The property owner was initially attracted because an economy of scale was reached (20,000 sq./ft) where the extra cost of the thermal envelope insulation was offset by an equal savings in HVAC mechanical systems. Since first capital costs were the same as competing bids from conventional contractors, the property owner chose the Synergy System and enjoyed an immediate return on investment. The dollar value of energy savings turned out to be equal to his profits from leased office space. Because the heating cycle only activates when the outside temperature is below 18 degrees F, this building has rarely used its gas heat source since it went on line. Imagine how this type of construction would impact heating oil consumption in the Northeast winter.

Twenty years later we have Boles Hall, an administrative office building at Centre College in Danville, KY. Energy Systems, Inc. designed the insulation/mechanical systems. This building is more than twice as energy efficient as the Spence Lane Building. Boles Hall costs about seven cents per square foot per year to heat and cool. This may be the most energy efficient building on the planet that uses no renewable energy technology like solar or geothermal. The economic impact of these buildings is over a dollar per square foot per year. What would it mean if all the school buildings built in the last 20 years could operate in a similar manner? Most school buildings range between 80 cents to 2 dollars per square foot per year to heat and cool. DOE figures energy costs for schools at $6 billion per year. DOE estimates are 25% savings on retrofit programs. Through new construction $6 billion dollars in energy costs could be reduced to one.

If we wish to examine the effect of entire communities built exclusively with energy performance standards, we could compare two identical communities with identical power plants on separate grids. One could be built entirely with the above mentioned performance standards and the other not. If the conventional community saturates the electrical supply when 1,000,000 homes and 100,000 commercial buildings are on-line, the energy performance community could continue to build 1,000,000 additional homes and 200,000 more commercial buildings before an equal electrical demand would exhaust the same supply. With such a large customer base, the utility can raise the price of electricity and increase profits with minimal economic impact. If both are building at the same rate, the performance community will have a much flatter growth curve on the demand side which makes long range planning much easier. The utility in the other community must instead spend millions to upgrade capacity at a much faster rate.

Self-sustainable architecture is the only realistic across-the-board Risk Aversion Strategy for the ratepayer. There are so many things that can cause a sudden electrical price hike in any given service region at any time. Drought has doubled the price of electricity in Prairie states. This will be catastrophic for many small business owners. Southern ratepayers and not TVA, will soon be footing the bill for environmental clean up. Or maybe you just live in California. Shall we count the ways? In the brave new world of deregulation and energy trading, endemic problems can have a systemic ripple effect. We are only one major event away from finding out. The economic impact of this risk aversion grows in parallel to the price of energy. Therein lies the beauty, no one is immune, and therefore everyone can benefit.

Environmental impact can be defined in tons of coal per year per square footage. Coal burning steam plants represent the main energy source of electrical production in America. If every building erected over the last three decades had these energy standards, there would be an average reduction in coal burning of 100 tons per 10,000 square feet per year. Global warming can not be solved without a group effort at the user end and cooperation from energy suppliers. Here people of Western New York have an additional opportunity to change their world by adding a few extra dollars to their electric bill. The ratepayer can choose to help fund capitol improvements to various renewable energy programs. Now that sounds like a future. While in the Southeast, TVA must spend the same amount to clean up environmental damage from strip mining coal as they spent to build the coal fired steam plants in the first place. Now that sounds like irony.

Building a self sufficient America can’t be done overnight but it can be done in one generation. Lets call it a 100-year plan, because by then there won’t be any oil left in Iraq anyway. There is no other industrial sector that could create more immediate jobs, both skilled and unskilled, than a massive federal building program. The performance engineering that begins here would certainly become an industry standard practice. And this could lead to one of the greatest economic booms in American history. One that would bring lasting rewards to those (taxpayers and property owners) with a stake in the American dream. Self-sufficiency by design is fundamental to maintaining a high standard of living, if not our survival as a species. The technology exists. All you have to do is ask for it.

Contact The Author Email the author Phone: 615-292-9382

www.iht.com Erika Kinetz IHT Saturday, March 8, 2003   Two weeks ago, the price of oil flirted with $40 a barrel, a level not seen since Iraq invaded Kuwait in 1990. The surge in energy prices - driven by the promise of war in the Gulf, political upheaval in Venezuela and a cold winter in the United States - has taken a bite out of economic growth. Consumers, who are spending almost 50 percent more on gasoline now than they were a year ago, do not have extra cash on hand to spend on other goods and services, and companies have been postponing capital investment. Even the president of the United States - whose country consumes 25 percent of the world's oil - has started to question the high cost of oil dependency. "It jeopardizes our national security to be dependent on sources of energy from countries that don't care for America, what we stand for, what we love," George W. Bush said in a speech last month. The case for alternative energy seems stronger now than ever. "It is a question of when, not if," said Richard Stuebi, president of NextWave Energy Inc., a consulting firm in Denver, Colorado. When remains a big question. Rising oil prices and the pending war with Iraq are unlikely to provide a sustained boost to the battered alternative energy sector. "Oil price spikes in the past have increased attention on alternative energy stocks and driven them up temporarily, but it's never been a sustainable trend," said Eric Becker, a portfolio manager and alternative energy analyst at Trillium Investment Management Corp., a socially responsible investment firm in Boston. "It's something only short-term traders have taken advantage of. It hasn't been anything long-term investors can use to make money." Even as the price of oil has surged, the alternative energy sector has tanked. The price of oil has risen almost 60 percent in the last year, while Reed Global Research's Distributed Generation Index, which tracks fuel cell, microturbine and hydrogen fuel companies in North America, has fallen 56.5 percent, exceeding the Nasdaq's 26.6 percent plunge by an uncomfortably wide margin. Historically, alternative energy technologies have been subject to cycles of hype and disappointment, most recently in 2000, when the mania for promising technology stocks with no earnings reached a fever pitch and many expected the United States to be hobbled by a major energy crisis. "The California energy crisis was a huge catalyst for the energy technology companies," said Young Jin, the energy technology analyst at Reed Global Advisors LLC, a global merchant bank based in Bellevue, Washington. "This caused a huge hype for the sector, raising the valuations of fuel cell and other energy companies to levels unjustified by their operational performance and product commercialization timelines." Despite past disappointments, some maintain that this time around things will be different. Globally, government regulations have been getting greener. The European Union has set a goal of obtaining 22 percent of its electricity and 12 percent of all energy from renewable sources by 2010. Britain is even stricter, calling for 20 percent of power to come from renewable energy by 2020. Last month, the White House proposed dedicating $1.2 billion over the next five years to develop hydrogen-powered fuel cell technology and infrastructure. While the United States has no federal quotas, in the last three years 13 states have put renewable energy standards in place. Moreover, technological advances are driving down the cost of wind and solar power. "Conventional prices are at best flat and maybe rising upwards," Stuebi said. "Renewable energy sources are on a downward slope." The big question for investors is when alternative energy will become cost-competitive. "The world only buys a green idea if it is equal cost," said Simon Baker, who manages the Jupiter Ecology Fund and the Jupiter Environmental Opportunities Fund for Jupiter International Group PLC in London, a subsidiary of Commerzbank AG. "Subsidies are needed to get over that hump while the cost is higher." Wind power is the closest to parity. According to Stuebi, on average, it has cost about 2.5 cents a kilowatt hour to generate power from coal or gas for the last 30 years. Wind power, in contrast, now costs just under 4 cents a kilowatt hour, down from 10 cents in 1980. It cost a dollar to produce one kilowatt hour of solar power in 1980; now it costs 20 to 25 cents. The tipping point for alternative technologies depends on geography. The average retail price of power from conventional sources is 8 cents a kilowatt hour in the United States, far lower than retail prices in Europe. According to the U.S. Department of Energy, the average retail cost of electricity in 1999 in Germany was 15.2 cents a kilowatt hour, in Japan it was 21.2 cents, in Britain it was 11.7 cents, in Denmark it was 20.7 cents and in France in 1998 it was 12.9 cents. Not surprisingly, countries with high energy costs have been more eager to adopt alternative technologies. "The relative economics are more favorable to alternative energy," Stuebi said. While about 1 percent of energy in the United States comes from alternative sources, according to Stuebi, Denmark gets more than 10 percent of its electricity from wind power, and Germany gets about 5 percent of its electricity from renewable sources. That still leaves a lot of room for growth, and as the cost of wind and solar power has declined, demand has surged. According to Stuebi, while demand for traditional fossil fuels has grown less than 2 percent a year over the last decade, sales of wind turbines have grown more than 30 percent annually and sales of photovoltaic modules have grown 15 percent annually. "That's why I play in this space," he said. "It has got such long-term sustained growth opportunities. Sometime in the next 20 or 30 years, it is going to be a very big deal." Big companies have already jumped on board. In May 2001, General Electric Co. bought Enron Corp.'s wind power division out of bankruptcy for $285 million. BP PLC is one of the world's largest manufacturers of photovoltaic cells. Royal Dutch/Shell Groupestablished a hydrogen division in 1999 and last year announced it would build the first hydrogen refueling station in Tokyo. There are few pure plays in alternative energy. "You've got some big players, and you've got a million little guys," Stuebi said. "There are very few midsize businesses that are healthy, robust companies. The majority of renewable energy businesses are venture-capital backed or totally mom and pop." But there are options, which to some investors look appealingly cheap. "There has really been a shock to valuations in the last two years," said Roland Pfeuti, a fund manager at SAM Sustainable Asset Management in Zurich. "A lot of the stocks we look at are quite a bit below a reasonable valuation. The broad investor universe is not looking at this sector at the moment. Most institutions have stopped covering these little companies." Pfeuti said two of the world's largest wind turbine manufacturers, Vestas Wind Systems A/S and NEG Micon A/S, both in Denmark, were trading below fair value. "If you look at the medium- to long-term potential of these two major players, they could be attractive." He said he would buy REpower Systems AG, a German manufacturer of wind turbines, and Evergreen Solar Inc., a U.S. manufacturer of solar power products, at current valuations. He also likes Echelon Corp., an American company that makes metering equipment to maximize energy efficiency. Pfeuti also said investors have not been paying enough attention to emerging markets, especially China. "China will have an enormous demand for power over the next 10 years, in terms of demographics and population growth," Pfeuti said. The fastest-growing market for wind last year, he said, was Germany, where 3,300 megawatts of new wind power went online. In contrast, he said, China could have demand for 250,000 megawatts of wind power. Maxwell Technologies Inc. recently formed an alliance with Yeong-Long Technologies Co. to manufacture and market Maxwell's proprietary ultracapacitor products in China. Pfeuti said IMPCO Technologies Inc., an American company that makes fuel management systems for cars, and Westport Innovations Inc., a Canadian company that has a joint venture with Cummins Inc., a large diesel manufacturer, to convert diesel motors to natural gas and propane, also stand to benefit from growing demand in China. Andrew Preston, head of socially responsible investments at Aberdeen Asset Management PLC in Scotland, is less sanguine. "My outlook is a bit cautious," he said. He holds only one company in the sector, Gamesa Corporacion Tecnologica SA, a Spanish company that produces windmills and manages wind farms. He likes the modest multiple - right now Gamesa is trading at about nine times earnings - and its diversified revenue stream. In the solar arena, Becker likes Spire Corp., an American microcap that makes manufacturing equipment as well as solar panels and modules. He noted that the company has neither profit nor debt but does have a promising medical device business. The company, which has a market cap of $18 million, recently sold partial rights to its innovative dialysis catheter to C.R. Bard Inc., a medical device company, for up to $16 million. "That's the kicker on the story," Becker said. "It may prove to be the better investment within the business." Becker also owns AstroPower Inc., a U.S. company with a market cap of $140 million that makes solar cells, modules and systems. "The stock is quite attractive," he said. "They are in a turn around phase." Becker expects earnings per share to grow 20 percent to 25 percent over the next five years. "That's the difference between fuel cells and solar and wind," he added. "Solar and wind companies make money. AstroPower is a high-risk stock because it is a small company in a competitive market, but I think it is considerably lower-risk than any fuel cell stocks." Fuel cells are farther from commercialization than wind or solar power. "They have a lot of the aspects of early-stage technology companies," Becker said. None turns a profit. They are high-risk, require high capital investment and must keep pace with rapidly evolving technologies. "There are a number of players going for the same golden ring," Becker said. "It's not clear who is going to get there." Ballard Power Systems Inc., a Canadian manufacturer that focuses on building fuel cells for cars, is probably the best-known player, but Becker says the stock is too expensive. "Whenever people have been optimistic about fuel cells, they have bought Ballard," he said. "It is a big name, but I haven't liked it. More recently they've begun to cut costs and reduce their cash burn." Young Jin, the energy technology analyst at Reed Global Advisors LLC, has a "sell" recommendation on Ballard. "They have the ability to become the 500-pound gorilla of the industry, but in the past they've spent too much money," he said. "I'm skeptical." Becker prefers stationary fuel cells, which provide continuous, high-quality power in one location, because, he said, they face fewer technological hurdles and are closer to commercialization than the much-hyped hydrogen-powered prototypes coming out of Ford Motor Co., Toyota Motor Corp., General Motors Corp. and DaimlerChrysler AG. He invests in FuelCell Energy Inc., a U.S. company that specializes in stationary fuel cells. Last month, a Michelin tire plant in Karlsruhe, Germany, began operating on electricity and steam generated by fuel cells made by FuelCell Energy and its European partner, MTU CFC Solutions GmbH, a subsidiary of DaimlerChrysler. Jin has a hold recommendation on FuelCell Energy. "With the poor economic conditions and low capital expenditures, many companies are not willing to spend multimillion dollars on fuel cells to run a facility," he said. Becker likes Hydrogenics Corp., a fuel cell manufacturer that also produces fuel cell testing equipment. "Their idea is to fund their own development through this profitable equipment business instead of taking all the money from investors," said Becker, who does not own the stock. Even optimists sound a cautionary note when it comes to alternative energy. "They are either high risk or speculative - higher than high risk," Becker said. "Own a portfolio that has more stable companies in it before you dip your toe into this area."

www.thebatt.com BY JONNY HAVENS March 03, 2003 Opinion

Faced with a number of options, the Bush administration should choose wisely

Oil prices have hit a 29-month high, forcing gasoline prices to rise to an average of $1.66 and to as much as $2.00 per gallon, according to The New York Times.

This increase of more than 50 cents compared to the average price per gallon last year is being worsened by three foreign crises. A possible war with Iraq, civil unrest in Venezuela and an oil workers' strike in Nigeria threaten to further increase the price of oil as the summer travel season approaches. Such dependence on foreign oil comes at a precarious time as the United States is hoping to recover from the recent recession. Faced with these problems, President George W. Bush and Congress need to make the development of a reliable alternative fuel a top priority.

According to CNN, Bush proposed a $1.2 billion initiative spanning five years to develop hydrogen as an energy source. According to the Office of Management and Budget's Web site, www.whitehouse.gov/omb, "hydrogen-powered fuel-cell vehicles have the potential to provide energy diversity, fuel economy and environmental benefits."

However, Bush's proposal is flawed. According to the Washington Post, $500 million of the initiative is already allocated to an existing hydrogen fuel development program. In effect, Bush is increasing funding by hundreds of millions of dollars over five years to a program of questionable effectiveness.

The plants producing the hydrogen may even be fueled by oil, according to The Washington Post. The allocated sum is also too high considering America's current dependence on foreign sources of oil and the fact that the initiative makes no mention of how the hydrogen is being produced.

The Department of Energy classifies nine fuels as alternative fuels, so hydrogen represents only one of nine or more possible answers to the U.S. energy dependence crisis. Other options include biodiesel, electric, ethanol, methanol, natural gas and solar power. Some of these options deserve heavier consideration as they have most of the infrastructure in place to distribute a new fuel, such as cleaner burning natural gas.

In another example, the Electric Power Research Institute states that the infrastructure for electric fuel cells is already 98 percent complete. Bush and Congress must look at all possible energy options, and then commit to the most viable one.

As gas prices rise and the political motivations tied to fuel sources become apparent, there is a greater need for a cleaner, domestic alternative fuel source.

Bush and Congress should significantly increase funding for all alternative fuels, not just hydrogen. Bold leadership is needed if the United States is to become a more energy-independent country.

www.thebatt.com BY JONNY HAVENS March 03, 2003 Opinion

Faced with a number of options, the Bush administration should choose wisely

Oil prices have hit a 29-month high, forcing gasoline prices to rise to an average of $1.66 and to as much as $2.00 per gallon, according to The New York Times.

This increase of more than 50 cents compared to the average price per gallon last year is being worsened by three foreign crises. A possible war with Iraq, civil unrest in Venezuela and an oil workers' strike in Nigeria threaten to further increase the price of oil as the summer travel season approaches. Such dependence on foreign oil comes at a precarious time as the United States is hoping to recover from the recent recession. Faced with these problems, President George W. Bush and Congress need to make the development of a reliable alternative fuel a top priority.

According to CNN, Bush proposed a $1.2 billion initiative spanning five years to develop hydrogen as an energy source. According to the Office of Management and Budget's Web site, www.whitehouse.gov/omb, "hydrogen-powered fuel-cell vehicles have the potential to provide energy diversity, fuel economy and environmental benefits."

However, Bush's proposal is flawed. According to the Washington Post, $500 million of the initiative is already allocated to an existing hydrogen fuel development program. In effect, Bush is increasing funding by hundreds of millions of dollars over five years to a program of questionable effectiveness.

The plants producing the hydrogen may even be fueled by oil, according to The Washington Post. The allocated sum is also too high considering America's current dependence on foreign sources of oil and the fact that the initiative makes no mention of how the hydrogen is being produced.

The Department of Energy classifies nine fuels as alternative fuels, so hydrogen represents only one of nine or more possible answers to the U.S. energy dependence crisis. Other options include biodiesel, electric, ethanol, methanol, natural gas and solar power. Some of these options deserve heavier consideration as they have most of the infrastructure in place to distribute a new fuel, such as cleaner burning natural gas.

In another example, the Electric Power Research Institute states that the infrastructure for electric fuel cells is already 98 percent complete. Bush and Congress must look at all possible energy options, and then commit to the most viable one.

As gas prices rise and the political motivations tied to fuel sources become apparent, there is a greater need for a cleaner, domestic alternative fuel source.

Bush and Congress should significantly increase funding for all alternative fuels, not just hydrogen. Bold leadership is needed if the United States is to become a more energy-independent country.