A Department of Energy study showing substantial national economic benefits from a quick lifting of natural gas price controls will be sent shortly to the cabinet group considering the issue, DOE officials said yesterday.
Full decontrol in 1982 would cause the average price of gas to residential consumers to jump 54 percent, while prices received by gas producers would more than double, the study said. Separately, the Council of Economic Advisers has estimated immediate decontrol would raise gas producer revenues by about $40 billion, sources said.
Reagan administration officials, while generally in favor of decontrol, are worried about a possible political backlash if they try to push through Congress any program that would raise consumers' gas bills by that much. Energy Secretary James Edwards, who could become a candidate for governor of South Carolina next year, is particularly wary of what decontrol could do to his political future, according to other administration officials.
Officials who are backing quick decontrol fear the political calendar may be against them even if President Reagan proposes it. No legislation would be sent to Capitol Hill until after Congress has finished with the budget and the tax cut bill, which would leave little time for action this year. And 1982 is an election year in which Congress may have little stomach for hitting consumers -- that is, voters -- in the pocketbook that way.
The DOE study, a copy of a draft of which was published by the newsletter Inside DOE, was prepared by Catherine Abbott of DOE's office of policy, planning and analysis. It makes no specific recommendation for speeding decontrol but it declares, "The efficiency and energy security effects argue for accelerated decontrol."
Oil imports would be cut by 680,000 barrels a day in 1983 if all price controls were dropped next year, the study concluded, compared to what would occur under the present phasing out of controls under the Natural Gas Policy Act. NGPA calls for the price of all newly discovered gas to end in 1985, but with controls continuing on about 40 percent of gas supplies that was found earlier.
Estimates by the CEA show a drop in oil imports of only 300,000 to 400,000 barrels a day with immediate decontrol, sources said. Other analysts suggest that since there are excess supplies of gas available today and oil prices are falling, a large increase in natural gas prices might even lead to higher oil imports as customers switch fuel.
In the long run, the study indicates decontrol of gas prices would have little impact on oil imports. By 1990 imports would be 110,000 barrels higher each day if all controls were ended next year than if NGPA runs its course, according to the study.
Economic efficiency would be improved by quick decontrol, the study maintains, through "increasing conservation, encouraging conversion to less costly energy sources, allocating available gas supplies to those who value it most, and allowing the least-cost mix of gas production (and possibly reducing the border price for gas imports)."