11.13.2007 World Energy Congress   Ministerial Forum
Remarks as  Prepared for Secretary  Bodman

Thank you. It's a pleasure to be here  with this  distinguished group of panelists. I want to thank Minister Bersani  for  convening this event and for inviting me to be a part of it.

I'm known for being direct, so let me get to   the point and submit that the challenges are quite clear to us all.  The bottom  line is this: the world needs a safe, reliable, clean,  affordable, and diverse  energy supply. This is a global challenge,  perhaps one of the most significant  of our time. And, as if we needed  more evidence of its scope, the  International Energy Agency's (IEA)  World Energy Outlook, released just last  week, provides it. It  estimates that the world's primary energy needs will  grow by 55% by  2030, with fossil fuels remaining the dominant source of  energy. Among  other things, it predicts a remarkable 73% increase in global  demand  for coal, driven largely by China and India.

We know that addressing this challenge in a   timely way will require literally billions of dollars annually over  many years  and the IEA estimates that $22 trillion of investment will  be needed between  now and 2030 to meet expected demand. We also know  that this investment must  occur around the world in developed and  developing nations alike and at all  stages of the energy cycle. At the  same time, we must recognize the realities  of global climate change  and develop cleaner sources of energy that at the  very least do not  worsen and hopefully can improve the health of our earth's   environment. And finally, we must continue to look for ways to enhance  energy  efficiency throughout our economies.

This set of global challenge demands   responsible action both from consuming nations and producing nations.  I don't  want to sound too alarmist, but in some ways, what we are  really talking about  is reducing the world's energy  insecurity.

For conventional fuels, the principal   challenges facing us are, will the necessary investments be made to  bring  sufficient hydrocarbons to market? Is the investment climate in  producing  countries conducive to inviting such capital flows? Are  large consuming  nations having the right type of discussions with  producing nations? If not,  why not? And are we adequately investing in  ways to produce fossil energy more  cleanly and  efficiently?

The world also needs new energy options in the   form of alternative fuels and advanced energy technologies.  Governments  certainly have a tremendously important role to play here.  But, governments  cannot do this job alone. We need a new way of  thinking about how we work with  the private sector. It is no longer  sufficient or wise for government to  direct the solutions alone. Even  our research priorities the R&D agenda  itself must be developed  with substantial input from corporations, utilities,  and universities.  And, research needs to be conducted in a coordinated   way.

I would also challenge governments around the   world to make a public commitment to increase your investment in the  R&D  necessary to achieve the technical breakthroughs we need, as  well as the right  balance between energy security and environmental  stewardship. The United  States and Japan still fund the vast majority  of all global R&D. And while  that is, in some ways, appropriate  given the size of our economies, it is not  a sufficient or efficient  solution going forward. The size of the problem we  face requires  massive global investment in the public and private spheres. Not   incidentally, increased investment in R&D would also help to  alleviate  another challenge that we share the shortage of qualified  engineers and  technical staff needed to meet the demand for rapid  innovation. We need to  invest in the next generation of leaders to  steer us through the energy  challenge. This is not receiving enough  attention or concerted  action.

I believe we also must find innovative   approaches to getting beneficial technologies out into the marketplace  and to  share the risk that the capital markets and private sector are  not yet ready  to take on. In the U.S. we are employing a range of  collaborative models to do  this including cost-sharing partnerships  and loan guarantees covering a  variety of technical areas, such as  solar technologies, nuclear power,  clean-coal and carbon sequestration  and advanced biofuels, a favorite topic of  mine. For example, we are  making cost-shared investments in three cutting edge  bioenergy  Research Centers (on the order of $375 million over five years) as   well as a series of small and large-scale biorefinery projects focused  on  producing ethanol from a wide variety of non-food plant materials.  These types  of projects will advance President Bush's plan to reduce  projected U.S.  gasoline consumption by 20% by 2017, which would  include the production of up  to 35 billion gallons of alternative  fuels.

I would also add that any global energy   strategy must include efforts to expand access to emissions-free  nuclear power  in a way that responsibly manages waste and dramatically  reduces proliferation  risks. To this end, last year President Bush  introduced the Global Nuclear  Energy Partnership (GNEP), which aims to  facilitate the worldwide expansion of  nuclear energy for peaceful  purposes in a safe and secure manner. And I'm  quite pleased that  earlier today, Italy became the 17th country to formally  join this  partnership, and in accordance with all members, signed the GNEP   Statement of Principals. This cornerstone document establishes, among  other  things, the common goal of creating reliable fuel services that  will provide a  viable and economic alternative to the spread of  sensitive nuclear  technologies. The partnership seeks to take  advantage of the best available  fuel cycle approaches to recycle spent  nuclear fuel to reduce the amount of  waste and tap its unused  energy.

In all these areas, the key to unlocking our   energy future is ensuring that the innovation cycle continues at a  rapid pace.  We must leverage the tremendous power of private equity,  while also making  smart public funding and regulatory decisions, to  unleash the world's best  scientists and engineers on this problem.  Without sustained global investment,  without a new global commitment  that will support, not discourage new sources  of energy and  breakthrough technologies, we will not solve this   problem.

And we must solve it. We cannot let energy   become a variable, a risk, a question mark in the world's economic and   security equation. The world has united around issues of common cause  before.  And I would argue that there are few more compelling global  concerns today  than the need for a safe, affordable and clean energy  supply.

Thank you,
Location: Rome, Italy