Will African Americans Participate In Energy Production?

President Bush has signed two energy bills in the space of two years. This unprecedented accomplishment will help America to produce the energy it needs and use the energy produced more efficiently. Our questions is: How will Blacks participate in America's energy future? Unfortunately, Blacks do not currently own energy production companies (except for CAMAC International), are not in decision-making management positions and largely are not included on the boards of directors of these companies. The designated position at most companies is government relations and although this is a very important job, more opportunities should be made available for signififcant participation and equity. AAEA sees three areas that are addressed by the energy bills, which can be avenues for greater opportunities, particularly considering governmental support in these areas: 1) nuclear power, 2) ethanol, and 3) automobiles.

Nuclear power has Price Anderson liability protection ($9.5 billion) through 2025, $2 billion standby support (federal loan guarantee) against regulatory or judicial delays for six reactors, $20.5 billion in loan guarantees, production tax credit of up to $125 million per year for 8 years for first 6,000 MW of capacity, among other supports. There should be opportunities in hauling nuclear waste containers because these supports will be threatened if Yucca Mountain is not brought online. There could also be significant opportunites if nuclear is ever accepted as a carbon dioxide offset. AAEA is promoting a private offset strategy (Green Carbon Bank).

Ethanol use was mandated for an increase in use from 7.5 billion gallons per year by 2012 (2005 energy bill) to 36 billion gallons per year by 2022 (2007 energy bill). There should be many opportunities in this area because new pipelines will be needed to get ethanol from the Midwest to the East and West where the cars are located. Current pipelines cannot carry ethanol because they would corrode the seals and truck and train hauling are impractical and cost inefficient. There should also be good opportunities in hauling the corn for regular ethanol and stalks for cellulosic ethanol.

The Corporate Average Fuel Economy Standard (CAFE) was incresed from the current level of 27.5 mpg to 35 mpg by 2020. This history making increase has great implications for global climate change mitigation. In addition to new methods for gasoline fuel economy, AAEA is promoting plug-in fuel cell hybrid electric vehicles and we believe there are great opportunities for early entry entrepreneurship in this area.

Of course, none of these industries are going to go out of their way to include African Americans in employment, management and ownership upgrades. However, due to the federal government supports for these sectors, the Congressional Black Caucus should exercise some oversight to monitor minority participation. If it is found that African Americans are being excluded from participation, then the CBC should do something about it. The entire CBC voted for the 2007 energy bill (Al Hastings & Eddie Bernice Johnson did not vote). If you have specific questions or concerns contact AAEA and feel free to express your opinion in Comments below.