ENERGY secretary sees no gas tax cut or price controls

Tuesday, May 8th 2001, 12:00 am
By: News On 6

WASHINGTON (AP) _ Energy Secretary Spencer Abraham discounted any rollback in gasoline taxes or price controls on electricity Wednesday despite soaring prices at the pump and blackouts in California.

Abraham noted that as a senator last year he proposed suspending the federal gasoline tax when prices spiked and said ``I couldn't get 40 votes'' in support of the proposal.

``I'm not likely to recommend that course to anybody. I've learned from my own experience,'' Abraham told reporters during a break in a congressional hearing.

Abraham reiterated the Bush administration's strong opposition to price controls on wholesale electricity sales in the West. Congressional Democrats and a small number of Republicans have called for such price caps to rein in power prices across the West.

``Price caps will create more blackouts and the blackouts will last longer,'' Abraham said, arguing that price controls will discourage electricity generation.

Abraham said he was disturbed by published reports that gasoline in California and possibly elsewhere might soar to as much as $3 a gallon this summer. He called such predictions unsubstantiated and said they, in themselves, could lead to price increases.

Abraham said that refineries have been operating at high capacity and that gasoline inventories are, in fact, growing. That ``should bring a little bit of decreases in prices,'' he said.

On another matter, Abraham welcomed reports that the Organization of Petroleum Exporting Countries may increase oil production later this year. But he greeted the reports with caution and said no conclusions should be drawn at this time.

Abraham, who testified before a Senate Appropriations subcommittee on his department's budget, defended administration decisions to cut money for energy research and development, particularly renewable energy programs.

The Bush budget calls for cutting such research by about 30 percent, with some programs involving solar and wind energy slashed in half.

``These cuts are unacceptable,'' Sen. Conrad Burns, R-Mont., told Abraham.

Sen. Robert Byrd of West Virginia, the Appropriations Committee's senior Democrat, said he was ``dumbfounded'' by the proposed budget cuts in energy research, saying it would harm the search for new energy supply.

``The oil and gas is not going to rise from the ground all by itself,'' Byrd said.