Alternatives for Reducing Oil Imports by 1990; and Current Status of Recommendations in 1976 GAO Report

EMD-80-18: Published: Oct 26, 1979. Publicly Released: Oct 30, 1979.

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The United States should move to develop energy alternatives since it is both politically and economically vulnerable to imported oil disruptions. An analysis was requested of alternatives for reducing oil importing by 1990. These alternatives should constitute a balanced energy program including conservation, renewable energy sources, conventional oil and gas, coal, and synthetic fuels.

Conservation and renewables should take a very high priority in the Nation's effort to reduce oil imports. A way of stimulating conservation and renewable energy investment would be to subsidize them on a per-barrel-of-oil-saved basis up to the level of the subsidy for synthetic fuels. An issue deserving special attention in the continuing effort to achieve greater levels of energy conservation is the development of individual consumer habits and attitudes which would result in more efficient personal consumption of energy. In general, widespread use of renewable technologies now is limited by a number of constraints, such as high initial cost, long payback periods, and technical risk. A number of government programs in conventional oil and gas could displace oil imports. The administration is currently phasing out domestic oil price controls by 1981, which would reduce imports by about 1.6 million barrels per day by 1990. Actions aimed at developing unconventional natural gas sources are also taking place. Another energy option which should be pursued is oil import reduction through conversion to coal. Coal conversion action will reduce the quantity of oil and gas used under industry and utility boilers. Synthetic fuels are also an alternative to imported oil. Unfortunately, a synthetic fuels industry will, at least in the medium term, be expensive. However, since it will be complex, capital intensive, and technologically novel, significant sythetic fuels production should not be expected until the late 1980s.

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