President Carter is going to let prices of some newly discovered oil rise above the level of present controls without waiting for Congress to pass judgement on his national energy plan, the White House announced yesterday.
White House energy adviser James R. Schlesinger - at a breifing to fill in details has the authority to set the oil pricing portion in motion with without waiting for congressional approval.
A Federal Energy Administration source said Congress would still [WORD ILLEGIBLE] veto power, and could vote to stop [WORD ILLEGIBLE] presidential action within 15 legislative days after Carter formally [WORD ILLEGIBLE] it. But administration planning believe Congress is unlikely to do that.
Energy officials said that "within couple of weeks" the administration will issue regulations to establish a incentive price for newly discovered oil above the current maximum of $11.28 per 42-gallon barrel. This new price, intended to stimulate exploration, would be allowed to rise in monthly increments over the next three years to the uncontrolled world level, currently $13.50 a barrel.
The law under which Schlesinger said the President will act, the Energy Policy and Conversation Act of 1975, limits oil price increases to 10 per cent a year. He indicated that if world oil prices rise so rapidly that this 10 per cent limitation becomes restrictive, FEA will ask Congress to approve larger yearly increases.
Schlesinger also revealed, in a just completed 103-page book titled, "The National Energy Plan," that the administration may, if goals for conserving energy are not met, propose new conservation measures which it earlier considered and rejected.
hese could include a tax on commuter parking to spur increased use of mass transit and car pools, new laws tightening minimum gasoline mileage standards for new cars, mandatory insulation in new homes, and a tax on "waste heat" to prod industry into installing machinery to convert waste heat into electricity.
Schelesinger said the plan calls for sacrifices from" . . . those who are wasteful in the use of energy.
"The greatest sacrifice most people must take is to relinquish their cherished beliefs," he said. "American life has been built on the assumption that there will be free and unfettered us of cheap energy . . . . Those kinds of beliefs are changing."
For those who believe that a free market" . . . will solve all of our problems, there are some formidable adjustments to be made," he continued.
Taking note of criticism that the plan does not offer enough incentives for new oil production, Schlesinger said granting oil companies the world price, $13.50, for thei newly discovered oil is "a major incentive, and an impressive price."
It is about twice as much, he said, as oil companies get after British taxes from producing wells in the North Sea, where drilling and production are often much more difficult and costly.
The energy plan book said that total decontrol of oil prices, which many in the oil industry have been seeking for years, "would result in a massive transfer of income from the American public to the oil and gas producers amounting to $14 to $15 billion, nearly 1 per cent of the U.S. gross national product."
Stressing that "there is no alternative to make some use of nuclear power," Schlesinger also told reporters that the administration anticipates constructing 200 new nuclear power plants between now and 1990. Currently there are 63 nuclear reactors in operation, and 75 are in the words.
When asked about resistance from environmental groups, Schlesinger said that most environmentalists accept the administration's nuclear goals in exchange for Carter's commitment to energy conservation.
Schlesinger also said the total the government would collect between now and 1985 in new energy taxes under Carter's plan is $7 billion higher than the amount administration experts say would be paid back to the public in rebates and tax reductions of various kinds.