Democratic Senate candidate Bruce Lunsford held a press conference this afternoon to unveil his eight-point energy independence plan. Lunsford says the plan will provide both short-term relief and long-term solutions.

Here’s Lunsford’s plan from his press release. Let’s discuss.

Opening Up the Strategic Reserve. The Lunsford Plan would take a two-fold approach to the Strategic Petroleum Reserve. It would continue the moratorium on putting new oil into the Reserve, as well as releasing barrels from the Reserve into the marketplace to lower gas prices. This could put up to 50 million barrels of oil back into supply, which would have an impact on prices. In the past, America has tapped the SPR which resulted in a dramatic decrease in price. [Energy Information Administration; New York Times, 9/23/00; Center For American Progress, “Sell Oil From The Strategic Petroleum Reserve To Lower Prices,” 6/13/08]

Fully Closing The “Enron Loophole.” The “Enron loophole” allows hedge funds, investment banks, and other Wall Street speculators to secretly buy and sell oil contracts. It is named after Enron, the notorious energy trading company, which pushed for a provision that kept energy trading off of regulated exchanges, evading speculation limits and accountability. Experts, including oil executives and economists, say that speculation trading has potentially increased oil prices by as much $40 per barrel, or $1 per gallon of gas. The Lunsford Plan would fully clamp down on Wall Street traders who are driving up oil prices in search of paper profits and bring more accountability to energy trading. [Congressional Quarterly Weekly, 4/12/08; Business Week Online, 5/14/08; Detroit Free Press, 10/31/07; Dr. Mark Cooper, Testimony Before Senate Commerce, Science, And Transportation Committee, 6/3/08]

Read the rest after the jump…

Providing A Gas Tax Holiday To Ease The Burden At The Pump. The Lunsford Plan would provide a gas tax holiday. The gas tax holiday concept, which is also supported by Sen. John McCain, would suspend the federal gas tax, which is currently $0.18 per gallon and $0.24 per gallon for diesel. For a car with a 15 gallon tank, this would mean saving about $2.70 with every fill up. For people who fill up twice a week, this would provide a savings of more than $280 a year. The gas tax holiday would remain as long as oilmen are running the White House, and Big Oil is writing America’s energy policy. Making oil companies pay their fair share of taxes through a windfall profits tax would offset the costs of lost revenue for vital infrastructure projects. [Associated Press, 7/8/08; Federal Highway Administration]

Protecting Consumers. The Lunsford Plan would provide stiffer penalties for companies caught price gouging to make sure Kentuckians are paying market price for gas. Similar to how Kentucky Attorney General Jack Conway is investigating gas prices in Louisville and Jefferson County, the Lunsford Plan would make sure that Kentuckians aren’t being victimized by businesses that are knowingly breaking the law. [Louisville Courier-Journal, 7/4/08]

Requiring Oil Companies To Drill On Currently Leased Land. Oil companies are currently sitting on more than 68 million acres of land, both onshore and offshore, that is leased for drilling. That figure is more than 2.5 times the size of Kentucky. Yet these areas are undeveloped because drilling there would not yield high enough profits to maintain oil companies’ record earnings. The Lunsford Plan would follow Congressman John Yarmuth’s lead and compel oil companies to drill on existing leased areas. [Mineral Management Service; Congressman John Yarmuth Press Release, 6/12/08; Associated Press, 7/23/08]

Tapping Into Oil Shale Supply. America is potentially sitting on a trillion barrels of oil underground in oil shale, mainly located in parts of Utah, Colorado, and Wyoming. Analysts estimate that of this trillion, approximately 800 billion barrels could be recovered for commercial use, or more than three times the amount of oil in Saudi Arabia. If these reserves are tapped, the 800 billion barrels would go a long way towards easing the energy crisis. Plus, by using domestic sources America would not only reduce its dependence on foreign oil, but also boost its economy. This really is a win-win. [RAND Oil Shale Development In The United States, 2005; Energy Information Administration]

Promoting Kentucky Clean Coal As A Vital Part Of America’s Energy Plan. Kentucky is a national leader in coal, and as one of the nation’s top producers, with the right technologies, coal could be the key to America’s energy future. Currently, about half the nation’s electricity comes from coal. The Bush Administration recently backed off a major program piloting new clean coal technology, but under the Lunsford Plan, the federal government would increase clean coal research and development. There is also great possibility with coal-to-liquid technologies. Coal-to-liquid technology could directly ease Kentuckians’ pain at the pump. By converting coal to liquid fuel, the demand for oil would lessen, lowering gas prices. Plus, increasing coal use would boost Kentucky’s economy. From the miners, to the technicians, to the communities that it would support, boosting the coal industry is vital to Kentucky’s economic future. The Lunsford Plan would devote vital resources to not only improving technology, but also finding new, innovative uses for coal. [Energy Information Administration; Department of Energy; New York Times, 1/31/08]

Moving Towards Alternative And Renewable Energies. The Lunsford Plan would help move Kentucky, and America, towards alternative and renewable energies. The plan would invest in new research, while helping businesses and individuals become more energy independent. The plan would take several steps including:

• Invest in government agencies, private businesses, and universities to research, develop, and commercialize alternative and renewable fuels.
• Provide tax incentives to businesses for making their facilities more energy efficient, and using fuel efficient transportation, as well as investing in job training programs to allow workers and industries to make a smooth transition to cleaner fuel technology.
• Encourage individuals to become more energy independent through incentives for hybrid vehicles and to make their homes energy efficient, as well as continuing to improve public transportation.