America needs a comprehensive strategy that provides American families with relief from rising energy costs, makes us more competitive, and strengthens this nation's long-term energy security. Real energy security requires that the United States:

• Reduce dependence on foreign oil and natural gas by raising fuel efficiency standards and setting a goal of producing 25% of the liquid fuel consumed from renewable sources by 2025;
• Confront the threat of climate change by providing the leadership needed to reach a global, binding climate agreement;
• Eliminate key proliferation threats posed by nuclear energy technologies so that they can be used as a viable and safe alternative to coal;
• Protect and modernize domestic and global energy infrastructure and distribution channels so they are not vulnerable to terrorists attacks, natural disasters or accidents; and
• Maximize energy security by coordinating policies with traditional allies and potential partners most importantly China and India.

The Bush administration energy policy has failed to address the major challenges facing our country. Under their watch:

• America has become more dependent on foreign oil and less safe;
• The threat posed by climate change has grown, while the administration has blocked domestic and international efforts to fight it;
• Fuel efficiency has gotten worse, not better. The average miles per gallon of a 2004 vehicle is 6% lower than the 1987-88 average; and
• A golden opportunity for American innovation and job creation has been squandered.

POLICY PRESCRIPTIONS

A real energy security strategy would reduce U.S. dependence on foreign oil, provide American families with relief from rising energy costs, tackle climate change, eliminate the threats posed by nuclear energy, protect energy infrastructure, and foster an open, rules-based global energy market.

Reduce dependence on foreign oil and natural gas. In the years to come, countries in the Middle East and other unstable regions will control an increasing share of the world's oil. The United States must meet this challenge by diversifying its energy mix away from oil, maximizing domestic production of fossil fuels in an environmentally friendly fashion, curtailing energy demand, and diversifying sources of supply for itself and its allies. America must set a goal of producing at least 25 percent of the liquid fuel consumed in the United States from renewable sources by 2025. To achieve this goal, government and industry must boost their investments in biofuels, particularly cellulosic ethanol. The government must also reduce overall demand for transportation fuel and natural gas by raising the Corporate Average Fuel Economy (CAFE) standards, and offering incentives for the U.S. automotive industry to increase average fuel efficiency in all vehicle categories.

Confront the threat posed by climate change both abroad and at home. The United States must immediately re-engage in international climate change negotiations and provide the leadership needed to reach a global, binding climate agreement. The U.S. must also take steps to reduce its own greenhouse gas emissions by developing a national trading system, similar to those in Northeastern states and the European Union, that uses free market incentives to reduce pollution. By limiting greenhouse gas emissions and creating an emission credit market, the system would reduce global warming pollution and encourage investment in technologies that reduce emissions.

Eliminate key proliferation threats posed by nuclear energy technologies. The existing global nonproliferation regime and its safeguards must be updated and expanded for nuclear energy to become a viable alternative to coal. The international community must close loopholes in Nuclear Nonproliferation Treaty (NPT), which allow countries to acquire facilities that can be used to produce weapons-usable fissile materials under the guise of a peaceful nuclear energy program, and also increase and strengthen inspections of suspected illegal nuclear facilities and expand the responsibilities and authority of the International Atomic Energy Agency.

Protect and modernize domestic and global energy infrastructure and distribution channels. In an increasingly global energy market, a disruption at a single strategic point in the distribution system can have dramatic economic consequences around the world. The United States should defend the unrestricted flow of oil and gas, strengthen and diversify the networks of pipelines, transmission lines, and terminals that transport oil and gas and maintain a strong emergency response system to prevent, and respond to, disruptions and embargoes. The United States should develop a "smart grid" electrical system that minimizes the impact of energy disruptions, whether caused by natural, manmade, or terrorist events. A "smarter" electrical grid would minimize the chances of a massive failure like the one that affected the northeastern United States and Canada in August 2003. Strategic gasoline and jet fuel reserves that are positioned throughout the United States should be developed.

Maximize energy security by coordinating policies with traditional allies and potential partners. In order to develop opportunities for strategic cooperation on energy security issues, the United States must promote the development of a global rules-based energy market. The politicization of energy resources, whether through a supply embargo or unnecessary restrictions on foreign investment, only generates higher energy prices and creates competition where there could be cooperation. Given India and China's growing demand for energy it is important that we establish a formal partnership between them and the International Energy Agency (IEA). This will help facilitate information sharing on energy markets and technologies, ensure that oil importing member countries build and maintain strategic reserves, and act as a useful forum for coordinating emergency responses. Given India and China's soaring energy demands they must be part of this organization.

THE BUSH RECORD

Rather than develop a strategy to ensure America's long-term energy security, the Bush administration has put forward lofty goals with no strategy or funding to achieve them. Under this administration the U.S. has become more, not less, dependent on foreign oil. The threat of global climate change has continued to grow, and a great opportunity to create new jobs and move our economy into the 21st century has been squandered. At the current rate, 20 years from now the U.S. will be more, not less, dependent on oil supplies from countries like Saudi Arabia.

America has become more dependent on foreign oil and less safe because of current energy policy. President Bush has provided empty rhetoric rather than a viable strategy or adequate funding to reduce U.S. dependence on oil. The day after President Bush pledged in his State of the Union Address to "replace more than 75% of oil imports from the Middle East by 2025," Secretary of Energy Samuel Bodman quickly backed away from pledge, saying it "was purely an example: and should not be taken literally." Moreover, in a recent bipartisan survey of more than 100 security experts, nearly two-thirds said the Bush administration's energy policy makes the U.S. more vulnerable to terrorist attacks, while some 82% agreed that reducing dependence on foreign oil should be a higher priority.

The threat posed by climate change is growing, yet the Bush administration is blocking domestic and international efforts to fight it. Today the potential catastrophic effects of climate change are readily apparent. Hurricanes, for instance, feed off the energy in warming waters, and scientists have linked a rise in hurricane intensity to global warming. Nevertheless, the U.S. remains the largest part of the climate change problem rather than a leader in finding a solution.

The Bush Administration has ignored fuel for cars and airplanes. Two-thirds of our nation's oil is consumed by transportation fuels, yet the Bush Administration has not supported initiatives to increase significantly automobile fuel efficiency. The average miles per gallon of a 2004 vehicle is 6% lower than the 1987-88 average.

A golden opportunity for American innovation and job creation is being squandered. The failure to support research and development is undercutting American firms who should be positioned to take advantage of global opportunities for new energy technologies, while creating high-paying jobs at home. A 20 % increase in spending on energy research and development is grossly inadequate to solve our technology roadblocks and it is targeted at the wrong problems. At the same time, competitors like China are exploring new technologies.

The current administration is failing to modernize our energy infrastructure and diversify distribution channels. The August 2003 blackouts served as a stark reminder of how vulnerable and antiquated our energy infrastructure is, yet no steps have been taken to modernize it. Also, Hurricanes Katrina and Rita exposed the vulnerability of storing all our strategic petroleum reserves in the Gulf Coast area, but no steps have been taken to diversify away from this region.

The recommendations in this brief are based primarily on a task force report by the Center for American Progress. Energy Security in the 21st Century: A New National Strategy.