Department of Energy Organization Act (1977)

Joseph P. Tomain

Prior to the 1970s, the responsibility for energy regulation was spread among a variety of federal agencies, including such cabinet-level departments as the Department of Interior and the Department of Agriculture. Energy issues also were administered by independent regulatory agencies, such as the Federal Power Commission and the Atomic Energy Commission, which were renamed, respectively, the Federal Energy Regulatory Commission (FERC) and the Nuclear Regulatory Commission. Complicating energy regulation even further is the fact that individual states regulate the natural resources used for the production of energy through their own statutes, regulations, and case law.

The major impetus for efforts at energy planning and coordination was the "energy crisis" of the mid-1970s stimulated by the OPEC Oil Embargo of October 1973. Congressional concern focused on matters of energy reliability, environmental protection, reasonable prices, economic stability, and national security.

Presidents Nixon and Ford responded to the energy crisis with several initiatives centered predominantly on controlling oil supplies and prices. President Carter introduced his National Energy Act, consisting of five pieces of major legislation supported by the declaration that the energy crisis was the "moral equivalent of war." The National Energy Act addressed a wide range of energy regulation from traditional fossil fuels such as coal, oil, and natural gas to conservation and rate design. In an attempt to coordinate all of these activities, Congress passed the Department of Energy Organization Act in 1977 (P.L. 95-91, 91 Stat. 565). In 1980 Congress passed the Energy Security Act, which addressed alternative energy sources from solar power and geothermal to oil shale and tar sands.

The Department of Energy Organization Act was based upon Congressional findings that the United States faced an increasing shortage of nonrenewable energy resources, thus increasing its dependence on foreign energy supplies, particularly oil, and presenting a threat to national security; that a strong national energy program was needed; that energy policy was fragmented in the federal government; and that a national energy program needed to be integrated and coordinated.

ESTABLISHING THE DEPARTMENT OF ENERGY

The Department of Energy (DOE) was established as a cabinet-level agency with responsibility for information collection, policy planning, coordination, and program administration. To further those goals, the Economic Research and Development Administration and the Federal Energy Administration were abolished, and their powers were transferred to DOE. Also, the Federal Power Commission was renamed the Federal Energy Regulatory Commission and came under the umbrella of DOE, while retaining its status as an independent regulatory agency. DOE also had the responsibility for various energy regulations formerly administered by the Department of the Interior, the Department of Housing and Urban Development, the Interstate Commerce Commission, and Department of the Navy, and the Department of Commerce, among others. Established within the Department of Energy were an Energy Information Administration and an Economic Regulatory Administration along with an Office of Energy Research.

The DOE was charged with assisting in the development of a coordinated national energy policy. To that end, DOE is required to submit to Congress a biannual National Policy Plan containing energy production, utilization, and conservation objectives, as well as identifying strategies and recommendations for action.

ENERGY POLICY IN THE UNITED STATES

Historically, the United States has had neither a comprehensive nor a coordinated national energy policy. Several factors contribute to a lack of a national energy plan, including the fact that energy matters are spread throughout the federal government; that the preference for social ordering is the market; and that federalism inhibits coordination. In oil and gas matters, for example, state, statutory, and common law affect exploration and production; and for natural gas and electricity, state public utility commissions affect retail rates and sales.

Moreover, the Department of the Interior retains responsibility for the management of federal lands and resources. Its agencies include the Bureau of Mines which administers surface mining and reclamation regulations; the Bureau of Reclamation, which administers hydroelectric projects; the Bureau of Land Management, which is responsible for federal lands: and Minerals Management Service, which regulates the intercontinental shelf. The Department of Labor through its Mine Health and Safety Administration regulates health and safety standards for miners. To these federal agencies can be added the Environmental Protection Agency, the Council on Environmental Quality, and the Department of Transportation. Thus, even after the passage of the Department of Energy Organization Act, energy regulation and administration remains fragmented at the federal level.

It is still the case that FERC's administration of the Federal Power Act and the Natural Gas Act involves primary federal energy regulation. FERC has been very active in deregulating the natural gas and electric industries as well as revamping the hydroelectric licensing process.

At a general policy level, the United States has had a dominant model of energy policy throughout the twentieth century and continuing into the twenty-first. That dominant model largely relies on large, capital-intensive, fossil fuel industries such as coal, oil, and natural gas, and it centers on the production and distribution of those resources as well as electricity. Over recent years, energy policies and proposed energy legislation have recognized the importance of alternative energy sources, conservation, and sustainability. Nevertheless, the mainstay of national energy policy and planning remains fossil fuels.

Perhaps the most important function played by the Department of Energy has been to gather information, particularly through the Energy Information Administration. The energy information is thorough, extensive, and updated on a regularn some instances dailyasis. Information on production, consumption, and pricing is readily available at the DOE Web site through its biannual National Energy Policy Plan, which provides baseline information on energy industries and provides solid data for understanding the history and direction of energy policy and planning.

See also: FEDERAL POWER ACTS; NATIONAL ENERGY CONSERVATION POLICY ACT; NATURAL GAS ACT.