At least 50 percent of U.S. energy spending should be focused on developing renewable-fuel sources, according to a KPMG LLP survey of oil and gas executives.
The executives see declining oil reserves as an “irreversible and worsening'' situation, Bill Kimble, KPMG's leader for industrial markets, said in a statement. “Oil and gas companies are sending a clear signal to the government that intervention is needed.''
Falling reserves have led producers to spend more on exploration and to renew efforts to maximize production from aging fields. More than two-thirds of the executives surveyed said they expect their companies to boost production and exploration capital spending by more than 10 percent this year.
Of the 553 energy executives surveyed, 25 percent said at least 75 percent of the government's energy spending should go toward developing renewable energy. Forty-four percent said at least half of the funding should be spent the same way.
The Bush administration is pushing to increase U.S. ethanol consumption by raising the federal mandate for renewable-fuel use almost fivefold to 35 billion gallons a year by 2017. The U.S. Senate is debating legislation that would mandate the use of 36 billion gallons of biofuel by 2022.
Sixty-percent of the survey respondents said it's impossible to mass-produce renewable fuels by 2010. Only 18 percent of the executives said ethanol could be mass-produced in the U.S. by then. Thirteen percent said biodiesel was the likeliest prospect.
The KPMG survey also asked executives' opinions on global warming. Eleven percent said global warming is not occurring, 65 percent said it's occurring as part of a natural weather cycle, and about 25 percent said global warming is real and caused by carbon dioxide emissions.
