Comments on the Administration's Proposed Synthetic Fuels Commercialization Program

RED-76-82: Published: Mar 19, 1976. Publicly Released: Mar 19, 1976.

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A proposal not enacted by Congress, but which would have authorized a loan guarantee program for commercial synthetic fuel demonstration facilities, is evaluated by GAO. This review: describes the current status and goals of coal gasification, coal liquefaction, and oil shale conversion technologies; analyzes House Resolution 3474, section 103, that was introduced, but not enacted, in the first session of the 94th Congress; and discusses the desirability of providing Government incentives to the private sector under the synthetic fuels program. An Interagency Task Force on Synthetic Fuels Commercialization was established in 1975 under the Energy Resources Council to determine and develop various measures associated with the commercialization of synthetic fuels. The Task Force recommended a two-phase program aimed at: developing information on, and demonstrating the technical, economic, and environmental feasibility of commercial-scale plants using available technologies; and providing Government incentives, such as loan guarantees, construction grants, and price supports, to encourage industry to participate in the production of synthetic fuels.

In anticipation of legislation authorizing phase one, the Energy Research and Development Administration plans to augment the Task Force Report by completing various studies. These studies are planned to be completed by July 1976 and are generally aimed at: undertaking strategy and policy analyses necessary for program implementation; initiating long lead-time activities related to program implementation, such as environmental impact statement finalization, program regulations; and informing the public, Congress, States, and other groups about the proposed program and respond to requests as needed.

Matter for Congressional Consideration

  1. Status: Closed

    Comments: Please call 202/512-6100 for additional information.

    Matter: Congress should consider awaiting the completion of the studies to be made by the Energy Research and Development Administration before considering legislation authorizing a commercial demonstration program. The studies should provide Congress with better information for determining whether, and to what extent, Federal assistance should be authorized to carry out phase one of the program. In this regard, Congress should consider requiring the Energy Research and Development Administration to: delineate and justify the scope and magnitude of Federal assistance it feels will be needed to carry out phase one of the program; and justify the type and number of plants it will need to accomplish the objectives of phase one of the program.


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