Senate Committee on Post Audit and Oversight releases report on rising energy costs; crisis looms in fuel assistance funding

July 2, 2008 ... The energy crisis continues to directly impact millions of citizens throughout the Commonwealth. In order to address this critical issue, the Senate Post Audit and Oversight Committee published a report with findings and recommendations for the Commonwealth to cope with and begin to seriously address the energy crisis. The report is released following a recent Committee hearing titled, Running On Empty: Massachusetts Faces Record Energy Costs, during which an esteemed panel of experts testified about today’s rising energy costs.

Sen. Richard T. Moore, D-Uxbridge, a member of the Senate Post Audit Committee who co-sponsored the Post Audit investigation of the rising energy costs said, "This report shines some important light on the causes of the energy crisis and the need for federal action. While state governments don't have the legal authority to solve the larger issues, our Committee has issued some key recommendations for state action that I will pursue in the coming months."

During the hearing on June 3, 2008, the Committee challenged oil industry representatives and exposed the fact that last year Exxon Mobil made $40 billion in profits, the largest profit in history and allotted only $10 million for renewable energy.

The soaring costs of fuel and oil is a complex global issue that requires a multi-tiered response. While this is mainly a federal issue, the Committee found that solutions to this complex problem require a collaborative effort from the local, state and federal government.

Giving voice to consumers across the Commonwealth, the Senate Post Audit and Oversight Committee recommends certain actions the state government can take to promote short and long-term solutions to the rising energy costs and fuel prices.

The report urges the Commonwealth to reduce its own energy demand, pass key legislation to limit carbon emissions and promote alternative energy sources, and approve sufficient FY09 funding to ensure that citizens are able to heat their homes during the winter. Implementing the Committee’s recommendations will be a vital part in helping Massachusetts citizens cope with and begin to address the energy crisis.

Findings from the Post Audit and Oversight Committee report include:

With heating oil prices estimated to hit $4.46 per gallon this winter, Massachusetts must reassess its supplemental budget funding for LIHEAP, given the current energy crisis. The Committee is recommending that the state budget writers and leaders prepare to fund as much as $50 million or more in additional funding for fuel assistance this winter.

Excessive speculation in the futures markets, which have gone unregulated since the end of 2000, contributes $25 to $50 per barrel to the price of oil.

While some think drilling will be a “quick fix” to the current energy crisis, it is far from the long-term solution necessary to tackle this problem.

In order to complete a comprehensive legislative package to address the energy crisis, Massachusetts must pass legislation that would provide legal authority for an economy-wide cap to reduce carbon emissions, as well as pass legislation on alternative fuels that would result in a net reduction of carbon emissions.

In regards to the first bullet point about oil prices this winter, Sen. Moore said, “As the Senate Health Care Finance Chair, I am especially concerned about the need to provide sufficient fuel assistance funding to help our senior citizens make it safely through the next winter heating season. That has to be a top priority for the Governor and Legislature."

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