Gordon MacDonald, "Testimony to Congress" (July 17, 1979)

51million or two barrels to the supply side will have more than $3 abarrel dampening effect on the world price of oil.As I said earlier, the drop in Iran production, affected the worldsupply of oil by only something like 4 or 5 percent and it increasedthe price by 50 percent. As that New York Times editorial said, itis that last barrel of oil on the demand side, when you are missingthe one on the supply side, that is a $ 100 barrel of oil. That is thebasic economics of this problem .Senator PERCY. Thank you. I appreciate your testimony verymuch.Chairman RIBICOFF. Thank you very much. I hope you will takea few minutes from your labors, Mr. Cutler, that you and yourassociates can assist us in putting this together.Mr. CUTLER . If I had only this panel to worry about, I would feelmore comfortable.Chairman RIBICOFF. I know. Also keep in mind this is one opportunity to really put regulatory reform into action.Mr. CUTLER . Yes, sir.Chairman RIBICOFF. Just put that in the back of your mind. Youmight ask some of your friends to get to work on it now .Mr. CUTLER . Thank you, Mr. Chairman.Chairman RIBICOFF . Thank you very much. Our next witness isGordon MacDonald. Mr. MacDonald, an essential ingredient here isthe protection of the environment. Additional carbon dioxide emission is an alarming prospect. Water pollution is another hazard.So is the solid waste problem. Yet energy self-sufficiency is absolutely essential for the good of this Nation and the future of thisNation. Are the goals of producing synthetic energy and environmental protection contradictory ?TESTIMONY OF GORDON T. MacDONALD, DARTMOUTH COLLEGE, FORMER MEMBER OF PRESIDENT'S COUNCIL FOR ENVIRONMENTAL QUALITYMr. MacDONALD. That is precisely the problem I would like toaddress this morning. First I really applaud the attention that theCommittee on Governmental Affairs has given this problem .It is particularly important I think that a committee with a newperspective examine not only the energy but also the environmental aspects of the various suggested solutions to the energy problem. But I want to first describe the most important environmentalissue associated with the major commitment to synthetic fuels. Theworldwide change of climate resulting from the loading of theatmosphere with carbon dioxide.Next I will touch on the instrument the Government has now todeal with this environmental problem and briefly discuss alternative approaches to alleviating the energy shortage which has givenrise to the proposals that we have heard about this morning for amassive use synthetic fuels program .My thesis is simply that before we commit ourselves to theconstruction of a major synthetic fuel infrastructure involving investment of tens or hundreds of billions of dollars, we should makeevery effort to understand not only the short term benefits andcosts, but the longer term consequences to the generations thatmust live with the decisions taken today. Proponents of synthetic52fuels recall the success of the synthetic rubber industry in WorldWar II.They fail to remind us of the disastrous long -term impact of thatsynthetic industry on the natural rubber economies of SoutheastAsia and the consequent flow of events in Vietnam , Malaysia,Cambodia , and Laos.Man , through the burning of carbon -based fuels, is setting inmotion a series of events that seem certain to cause a significantwarming of world climates over the next decades. The use of synthetic fuels will accelerate and intensify these climatic changes.Such changes will have far reaching implications for human welfare in an ever more crowded world, will threaten the stability offood supplies and will present a set of intractable problems toorganized societies.The basic scientific problem is easily understood. Carbon basedfuels, when burned, produce carbon dioxide. Incidentally, this isone of the reasons why the cost of synthetic fuels keeps going upand up. It is because you have to use energy to make the fuels andas the cost of energy increases the cost of the synthetic productalso increases.That use of energy produces carbon dioxide as does the burningof the final synthetic product. The net result is that synthetic fuelsproduce two to three times as much carbon dioxide as do thenatural fuels.Carbon dioxide, in contrast to oxygen and nitrogen , the majoratmospheric components, absorbs the heat that the Earth wouldotherwise radiate back into space . Carbon dioxide acts as a blanketkeeping the Earth warm . Increasing the carbon dioxide content ofthe atmosphere will increase the number of blankets and raise thetemperature at the surface of the Earth .The consequences of the resulting change in climate are difficultto predict in detail, but it is highly improbable that the changes onthe whole would be beneficial.After 80 years of study on this problem by scientists throughoutthe world, the present day consensus is that doubling the carbondioxide content of the atmosphere will increase the average surfacetemperature by 2 to 3 degrees Celsius and that the temperaturechange will be amplified by a factor of 2 to 5 degrees in higherlatitudes. Put simply, a doubling of carbon dioxide would raise theaverage maximum temperatures in Washington , D.C. in the summertime from the low 90's to the high 90's or into the low 100's.The significant scientific advance of the past few years is thatthe uncertainty of what will happen to world climate as carbondioxide increases, has been substantially reduced . We can now ,with confidence, predict that the Earth will warm and the warming will be greater at high latitudes and less in the tropics. Whatremains uncertain are the important details of weather, such aschanges in the amount of precipitation and its distribution over theyears.Also uncertain are the impacts on society of a warming Earth .For example, warmer temperatures in the higher latitudes willshift to the north the geographic regions that can support wheatproduction , but that shift would place the optimal climatic condi53tion for wheat in areas where the soils have been depleted ofnutrients by ancient glaciations.The net impact of a warming trend may also lead to a melting oftheice sheets flooding the coastal regions of the world.When will the doubling of the carbon dioxide content of theatmosphere take place ? If the world continues along the lines ofthe past 30 -year period, increasing carbon fuel usage by 4.3 percentper year, and if the current mix of fuels is maintained , the carbondioxide content of the atmosphere will double in 2030. If we movefrom the present fuel economy to one based upon coal and synthetics, the date could be 30 years from now, 2010. This is becausesynthetic fuels, in their production and use, generate two to threetimes more carbon dioxide than do the natural fuels.With high year to year variations in weather, we may not beable to detect with absolute certainty these long-term changes before the year 1990-95 . By that time, if the synthetic fuel investment and infrastructure are in place, it will be extraordinarilycostly in economic and social terms to move away from a syntheticfuel economy.I will now discuss certain of the policy and institutional aspectsof the carbon dioxide issue. Despite congressional mandates , thisand previous administrations have failed in developing energy policy, to consider the long-term impacts on the environment ofburning coal or synthetic fuels.The National Environmental Policy Act of 1969 requires environmental_impact statements for proposals for legislation and othermajor Federal actions significantly affecting the quality of thehuman environment. I have studied dozens of the EIS's from numerous agencies on subjects such as coal leasing from the Department of the Interior, and synthetic fuel demonstration plants fromthe Department of Energy, and nowhere have I found an analysison the environmental impacts of carbon dioxide.The Environmental Protection Agency, under the Clean Air ActAmendments of 1972 is required to comment on the environmentalimpact statements as to their adequacy in meeting the requirements of the National Environmental Policy Act and nowherehaveI found EPA raising the point that the EIS's fail to analyze thecarbon dioxide issue.While the environmental impact statement process may havedeficiencies, it can alert Government officials to potential problems. The responsible agencies have clearly failed to do this in thecase of carbon dioxide.The Clean Air Act Amendments of 1972 and 1978 require thatthe Environmental Protection Agency set standards for pollutantswhich may not have direct health effects but, still, adversely affectthe environment. EPA has not considered the carbon dioxide issue,nor does EPA have a program of research to quantify the longterm consequences of increasing carbon dioxide.In view of the neglect of the carbon dioxide problem by theresponsible agencies, it is not surprising to learn that in the administration's consideration of energy policy, it has completely neglected the carbon dioxide problem .The National Energy Plan II issued this year contains only oneparagraph discussingcarbon dioxide and its impacts. The Presi