Obama wants research to wean vehicles off oil

By Matthew Daly and Nedra Pickler, Associated Press

Friday, March 15, 2013 | 11:10 a.m.

LEMONT, Ill. — President Barack Obama is pushing Congress to authorize $200 million a year for research into clean energy technologies that can wean automobiles off oil.

Obama proposed the idea of an energy security trust last month in his State of the Union address, but he was putting a price tag on the idea during a trip Friday to the Argonne National Laboratory outside Chicago — $2 billion over 10 years. The White House said the research would be paid for with revenue from federal oil and gas leases on offshore drilling and would not add to the deficit.

The money would fund research on "breakthrough" technologies such as batteries for electric cars and biofuels made from switch grass or other materials. Researchers also would look to improve use of natural gas as a fuel for cars and trucks.

Obama got a firsthand look at some of the cutting-edge vehicle research in a tour of an Argonne's lab, including a room that can go to extreme temperatures to test the impact on fuel efficiency. He talked to engineers working on electric car batteries and on an engine that runs on diesel and gasoline to reduce fuel costs.

"We want to keep on funding them," the president said as he looked at the engine, developed with public and private funding from Chrysler. "That's what I'm trying to tell Congress"

The proposal is modeled after a plan submitted by a group of business executives and former military leaders who are committed to reducing U.S. oil dependence. The group, called Securing America's Future Energy or SAFE, is headed by FedEx Corp. Chairman and CEO Frederick W. Smith and retired Marine Corps Gen. P.X. Kelley. The nonpartisan group says its goal is to "break oil's stranglehold on the transportation sector" through alternatives such as electric cars and heavy-duty trucks fueled by natural gas, but it had proposed a much larger $500 million annual investment.

Creation of the trust would require congressional approval at a time of partisan divide over energy issues. Republicans have pushed to expand oil and gas drilling on federal land and water, while Obama and many Democrats have worked to boost renewable energy sources such as wind and solar power.

Obama tried to appeal to both parties by pitching the trust plan not just as an environmental issue but as a job-creation plan that would help the United States remain a technology leader.

"If a nonpartisan coalition of CEOs and retired generals and admirals can get behind this idea, then so can we," Obama said in his State of the Union address. "Let's take their advice and free our families and businesses from the painful spikes in gas prices we've put up with for far too long."

There were signs agreement may be possible. Alaska Sen. Lisa Murkowski has called it "an idea I may agree with."

Murkowski, senior Republican on the Senate Energy Committee, did not fully endorse the plan, which is similar to one she has proposed to use revenue from drilling for oil and natural gas on public lands that previously were off-limits to energy production to pay for research on new energy technologies.

White House officials said the president's proposal would not require expansion of drilling to federal lands or water where it is now prohibited. Instead, they are counting on increased production from existing sites, along with efficiencies from an administration plan to streamline drilling permits. The government collects more than $6 billion a year in royalties from production on federal lands and waters.

Obama's push for the energy trust came as the Environmental Protection Agency released a new report Friday indicating that fuel economy standards rose last year by 1.4 miles per gallon — the largest annual increase since EPA started keeping track. The agency said the improvement was due to better availability of high-performing cars and more options for consumers.

The Alliance of Automobile Manufacturers suggested that rather than encouraging research on fuel-efficient cars, the government should focus on making diverse fuels more available and improving transportation infrastructure.

A spokesman for the energy security group SAFE welcomed Obama's plan, even though it does not call for expanded drilling. A plan released by the SAFE group in December recommended using revenues from expanded offshore drilling and increased production in Alaska in areas where it is now blocked.

"At the end of the day, we still think it's a proposal that can have bipartisan support and that can help reduce oil dependence," SAFE spokesman Brad Goehner said Friday.

Argonne is one of the Energy Department's largest national laboratories for scientific and engineering research, staffed by more than 1,250 scientists and engineers. White House officials said it was chosen as the site of the president's speech because of its tradition of research into vehicle technologies.