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Statement About the Federal Energy Administration Act of 1974

May 07, 1974

TODAY MARKS another important step in our journey toward independence in energy.

Five months ago, when the Nation was still in the grips of the energy crisis, I set up the Federal Energy Office on a temporary basis to deal with our most immediate problems. I also proposed legislation to create an agency to carry on the activities of the FEO on a continuing basis.

The FEO, under the leadership of William Simon and John Sawhill, has been highly effective in allocating scarce fuel supplies, in encouraging consumer conservation, and in initiating a new look at our energy demands in the future.

It has become increasingly apparent during the short lifespan of the Federal Energy Office that its activities should be placed on firmer footing. I therefore take special pleasure today in signing into law the Federal Energy Administration Act of 1974, creating a new, independent agency, the Federal Energy Administration, which will replace the Federal Energy Office. I congratulate the Congress on the passage of this measure and particularly the leaders who were responsible for managing the bill.

The new energy agency--FEA, as it will be called--will provide a more firmly based organization to carry out the responsibilities of the FEO through June 30, 1976, including:

--Fuel allocation and pricing regulation;

--energy data collection and analysis; and

--broad energy planning with particular emphasis on energy conservation and expansion of energy supplies.

As a first priority, I have directed FEA to work with other Government agencies to prepare a comprehensive plan for achieving the goals of Project Independence-the capacity for energy self-sufficiency by 1980.

The creation of the Federal Energy Administration is an important accomplishment, but we should recognize that by no stretch of the imagination have we yet overcome the energy challenge. There are now disturbing indications that with the passage of the immediate crisis---a crisis that we weathered much better than the critics ever expected--many Americans believe that good conservation habits can be forgotten.

We need continued conservation and major new initiatives to expand our energy supplies for the future. We must get on with the actions that are needed to meet the goals of Project Independence-to reduce the vulnerability of the United States to threats from other nations arising from our growing dependence upon foreign sources of energy.

The Nation is fortunate in having abundant energy resources. Now, with the help of the Congress, we must act to accelerate the development of those resources. Private industry is already moving ahead with investments to increase the production of coal, oil, and natural gas. The Government can assist by removing obstacles to efficient energy production.

The FEA, working with other Federal agencies, will make an important contribution to these efforts. Federal agencies are encouraging new methods of producing energy, such as the commercial use of geothermal energy and oil from our vast oil shale reserves. Further, we are supporting research and development to find new and better ways of using our abundant coal resources and to capture the benefits of solar energy and nuclear fusion. These efforts will be expanded if the Congress provides the greatly increased funding I have requested for fiscal year 1975.

But still more remains to be done by the Congress and the Nation if we are to bring energy supplies and demand into balance. There are now 16 key Administration proposals awaiting action on Capitol Hill, some of them for as long as 3 years. These measures are vital to both the conservation of energy and the expansion of supplies, and I urge once again that the Congress move forward more swiftly in acting on these bills.

As witnessed by the enactment of the Federal Energy Administration Act, we are making encouraging headway on the organizational front. I am also pleased to note that the Senate Government Operations Committee is .moving ahead with favorable action on the proposal I submitted last June, and which the House of Representatives passed in December, to create an Energy Research and Development Administration. This new organization, ERDA, would spearhead the Nation's extensive R&D efforts in energy.

I would urge similar speed on bills that would greatly expand our domestic supplies.

One proposal of particular importance is the Natural Gas Supply Act which I sent to the Congress in April of 1973. This act would replace the current, outmoded system of Federal price regulation with the competitive pricing of new natural gas. The existing system encourages inefficient use and waste of natural gas and destroys the incentive for the exploration and development which would make new natural gas supplies available.

I have also proposed legislation, the Mined Area Protection Act, which would allow mining of coal and other minerals to proceed with reasonable environmental protection and reclamation requirements. This legislation has been awaiting action since 1971. Legislation is needed which does not restrict coal production in unnecessary and arbitrary ways, but instead permits development in a manner which balances environmental considerations with our energy requirements. The legislation presently active in Congress in this area does not meet these needs.

This Administration has also made important proposals regarding the construction of deepwater ports, labeling of appliances and automobiles for energy efficiency, the revision of nuclear power plant licensing procedures, and other actions which would relieve our Nation's energy problems in the years ahead.

We have also proposed a series of changes in the tax laws which would recapture the windfall profits that are possible in a period of energy shortage and would give incentives to search for new energy sources at home rather than abroad.

All of these measures are important. The American people this winter showed that they had the spirit to face the energy challenge. Now it is up to the Government to show that it can provide leadership in the same spirit. I welcome the Federal Energy Administration Act as a major step in the right direction.

Note: On the same day, the White House released a fact sheet on provisions of the act and the transcript of a news briefing on topics relating to the energy situation by John C. Sawhill, Administrator of the Federal Energy Office.

Richard Nixon, Statement About the Federal Energy Administration Act of 1974 Online by Gerhard Peters and John T. Woolley, The American Presidency Project https://www.presidency.ucsb.edu/node/256528

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