Condoleezza Rice - Ensuring a Sound Energy Future

Ensuring a Sound Energy Future: Remarks With German Foreign Minister Frank-Walter Steinmeier and European Commissioner for External Relations and European Neighborhood Policy Benita Ferrero-Waldner

Secretary Condoleezza Rice
U.S.-EU Energy CEO Forum
Washington, DC
March 19, 2007

SECRETARY RICE: Good afternoon. Welcome to the State Department, everyone. I want to thank EU Commissioner Benita Ferrero-Waldner for being here with us. And of course, my good friend, Foreign Minister Frank-Walter Steinmeier. Thank you for co-hosting this event with me, Frank-Walter. This is an incredibly impressive group of energy leaders from both sides of the Atlantic and I want to thank all of you for joining us today and I know you had to take time out of busy schedules, so thank you very much.

Ensuring a sound energy future is one of the most critical challenges facing the world today. One of the most unexpected, indeed, disconcerting developments of recent years has been the warping effect that energy issues have had on the geopolitical landscape. Energy is truly a global challenge - making a decisive impact on issues as diverse as security, diplomacy, development, and climate change. No one nation can address the global energy crisis alone. We need to work together to seize new opportunities to develop cleaner and more efficient sources of energy and to prevent the global and rapidly growing demand for energy resources from generating unnecessary confrontation in the years ahead.

This is one of President Bush's highest priorities, and he has identified five key goals that will drive our policies at home and serve as the beginning of our consultations with allies abroad. We seek: to diversify world energy sources through free, open, competitive markets; to encourage a variety of energy sources, including renewable and alternate fuels; to use energy wisely through efficiency and conservation; to expand strategic energy reserves; and to protect the world's critical energy infrastructure.

With the President's guidance, I have taken several steps to reorganize here at the State Department and to integrate energy issues more fully and comprehensively into our foreign policy. I have appointed a new Special Advisor and International Energy Coordinator, and recast the responsibilities of one of our under secretaries and our assistant secretaries to focus on this issue with renewed intensity. We are looking for new opportunities, identifying new partners, and working in new ways to tackle the energy challenge more effectively.

We're off to a pretty good start. President Bush recently visited Brazil and launched a new partnership with the Brazilian Government in the area of biofuels. This agreement will transform the way we work together to promote a critical alternative energy source, deepening research and investment, helping developing countries in our hemisphere and beyond to fuel their growth, and working to enable more countries to supply energy for themselves and for others. The goal is to promote the democratization of energy - increasing the number of energy suppliers, which expands the market, boosts competition, and reduces the chance of supply disruption.

This kind of creative work is what we want to do in other parts of the world especially with our allies in Europe. I think we are approaching an inflection point in history when science, technology, policy and free markets are all converging on new approaches to supply affordable, reliable and clean sources of energy. To seize this opportunity fully, we need to change the shape of the table, ensuring a seat not just for policymakers, but for leading scientists and most especially for the private sector. That is exactly what we are doing today, Americans and Europeans together, to spur new and innovative approaches.

The United States and Europe are in a unique position to advance our common energy agenda both across the Atlantic and across the world. We share a common heritage which has generated many of the world's great entrepreneurs and many of its leading economies. We have the deepest and most innovative capital markets, seeding and growing many of the world's most innovative companies. We also have world-leading technical capacity to solve intractable challenges.

I would like to see the discussion over the next several hours change our governments and our -- challenge our governments and our private sectors to accelerate the innovation and deployment of new energy technology across the Atlantic. Our discussion today will target three key areas of transatlantic cooperation. First, we will canvass the most promising opportunities for increasing government-to-government collaboration. Second, we will explore how we can build better and more extensive public-private partnerships. And finally, surrounded by the leaders of many of the most prominent companies in the energy industry, we will discuss opportunities among the private sector participants to push the edge of the envelope of energy technology innovation.

I'm really looking forward to an open and lively discussion and to the follow-up on this most important challenge of our day. Thank you very much. Frank-Walter.

FOREIGN MINISTER STEINMEIER: (Via interpreter) Dear colleague, dear Condi, Dear Benito, ladies and gentlemen, this is almost a premier that we are celebrating today. We have politicians focused on -- meet with enterprises from the energy sector and with experts from the financial sector in order to attend to one of the really important questions of the 21st century. Therefore, dear Condi, a very warm word of gratitude for the facts of you making it possible for this high-powered CEO forum to meet here today. We have high-ranking and prominent representatives of the American and European business community attend today's forum. I think that that is a first positive signal that we are sending out here today. But I would also like to thank all those ladies and gentlemen from the research sector and from the business community who've come here. And I myself found out on the trip here, on the flight here when I talked to some of you that you support our initiative and that you give it your personal commitment. I can only subscribe to what you've just said, Condi, this forum once again bears out, or is going to bear out, that issues to do with climate policy have very much moved to the center of international politics. There is a link between energy policy -- in external energy policy, climate protection, that is indeed a central topic for us in Europe and not only for us in Europe really, but it's become a very important topic in the United States of America, too.

We touched on the overall context of this subject matter the weekend before last and when we met at the EU summit meeting. And the decisions that were then taken reflect this discussion. I think it's fair to say that as far as our positions are concerned on a future policy and energy and climate, we have indeed made major headway here.

For the very time, probably in the history of European integration, which was triggered off in the post-war period with the attempt -- or by the attempt of improving the situation of weak energy resources, so in a way we are continuing this 50 years later in a completely changed environment. One thing has become clear, Europe is indeed willing and ready to play a leading part or to continue to play a leading part -- a leading part. And I say this on purpose because even if we count 500 million inhabitants in Europe compared to the global threats, this is not going to be enough. And thus I'm very happy and pleased to see that we are pooling our efforts here and now. And the great hopes really that are placed on this transatlantic cooperation in this particular field have to be fulfilled.

Only last week when we met with our ASEAN counterparts in Nuremburg, we met with countries who based their hopes on the fact that in the end they will not only become objects of appeal but that they will be integrated and included in these joint efforts undertaken by the United States of America and the European Union to do more for climate protection to further develop energy technologies. And that then at a later point in time those technologies will also be made available to regions like Asia. I think that that is something that when we intensify the cooperation between the United States of America and Europe that is something that we can indeed attend to. I think it's going to be decisive for cooperation. We are the European Union, you are the United States of America, in the areas of global technologies we are leading and right now if my perceptions are correct, both sides of the Atlantic are very active when it comes to the public but also to the private funds. A lot of these funds go into these areas. We are doing much more than we used to do in order to promote research and development of new technologies.

When I look to the gentleman on my right, we've got our expert from (inaudible) with us and we notice that there is a growing interest of the financial markets to be involved here and the respective energy companies of automobile businesses who need those energy technologies for their cars are not going to consider this a threat but will consider it a confirmation of us having set out on the right path. I, indeed, believe we can do more. When it comes to cooperation between the United States and Europe, I think we can try to attend to reducing unnecessary red tape and bureaucracy, making tendering procedures easier so that the innovative potential can be tapped in a better way than has been the case so far and we can cooperate even more than we've done so far.

But I'd like to leave it at that, ladies and gentlemen, because politicians have every reason to listen to you and to let you enlighten us about where we stand and where we can go from here. And we look forward and express our hope that this kind of cooperation can lead to the solution for many of the upcoming questions of the future.

Thank you very much, indeed.

COMMISSIONER FERRERO-WALDNER: (Via interpreter) Secretary Rice, dear Condi, dear (inaudible) and ladies and gentlemen. I think it's really a very timely discussion and it's a subject that is absolutely center stage -- it's central stage in international politics and I think it's an excellent idea. And thank you very much, Condi, for having us here today. Because when we work together, the European Union and the United States, then I think we can also bring in other very important players. I was in China and India recently and I mentioned also, very high on my agenda, these questions. And as you said with ASEAN there is great interest also with other players.

I would like to make three points: one on technology, one on targets and one on the international cooperation. First on technology, I think we must bring to the markets new options for renewable energies and also for low emissions transport. And by the third quarter of this year, the commission indeed will table a very comprehensive directive -- you have heard about it already -- on the use of renewables, including on biofuels, heating and cooling, and also renewable electricity. And with our U.S. partners, we have recently also agreed to put second-generation biofuels at the top of our joint research agenda as already has been mentioned. And we are working on streamlining our respective procedures in order to cut off the red tape, very important.

We are on a track to a low-carbon economy and during this year, we shall complete specific legislative proposals to reduce CO-2 emissions, particularly in new vehicles. We shall further complete specific legislation on carbon captures and also storage. And we shall host an international conference on biofuels on the 5th and 6th of July in Brussels. President Barroso and also President Lula will attend and I'm very much looking forward also to a strong U.S. participation.

Second point on targets. Our experience shows that voluntary targets alone, unfortunately, cannot do the job. Hence, the landmarks decisions of 9th March, when we, the European Union, entered into binding commitments on CO-2 reductions and renewables. And these targets are ambitious, but we think they are doable. While setting caps and limits, we are also committed to market-based instruments, notably the emissions trading system or the version of cap-and-trade.

Market-based instruments help companies to channel investment to those areas where the impact is highest and costs are lowest. Before the summer, therefore, the commission will complete the ongoing review of the EU emissions trading system. And ETS, as we call it, will then enable the European Union to collectively meet our obligations under the Kyoto protocol. This system will provide companies with a long-term regulatory certainty, which is important for U.S., we know, to implement investments in the most efficient manner. And we would like to invite the U.S. Government to consider creating jointly with us a common carbon market and transparent and compatible rules. And may I remind you that it was indeed the U.S. that successfully pioneered the cap-and-trade in fighting acid rain.

And that brings me to my third and last point, international cooperation. If we join forces, as I said at the beginning, I think we have a great chance to bring the other international actors in there. And meanwhile, I think there is tremendous scope for our joint EU-U.S. cooperation, but we also can work together with countries like China, India, Ukraine, and Russia. And in our bilateral strategy, the energy dialogue -- I must say we can share information about complimentary approaches. We can go out to the Caspian Sea region, the Black Sea region, and we are very keen to do that together.

We as a commission -- and this is the end of my remarks -- will shortly present also a technical study on the Caspian-Black Sea energy corridor and also on the Nobuko project. And I think the United States here has provided very valuable inputs to the first study and we look also forward to cooperating very much with you on future ventures.

In conclusion, I think this is a very good beginning and I do hope that this forum already brings a lot of success to our common undertaking. Thank you very much, dear colleagues.

SECRETARY RICE: Thank you very much, Benita. I should mention that the United States, of course, has had now, for almost two years, the -- an Asia-Pacific partnership, which includes China and India, in an effort to marry concerns about economic development, environmental stewardship, and -- economic growth, environmental stewardship, and energy supply. That is a model that we think works very well because the point that China and India will have to somehow be a part of any effort is obviously a very important one.

And the President's efforts to make certain that we reduce gasoline usage in the United States by 20 percent over the next several years should also have a very major impact on our use of hydrocarbons. So there are a number of approaches that could be complimentary to one another and I think that we want to look to complimentary approaches.

So with that, let me turn to our CEO co-chairs for remarks. I'll turn first to the U.S. CEO co-chairs and I want to thank you very much, Mark Little of General Electric and Mr. Vinod Khosla of Khosla Ventures to lead us off in discussion.

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Released on March 19, 2007

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