Exxon Head Criticizes Energy Bill

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Exxon Head Criticizes Energy Bill

IRVING, Texas -- The proposed reform of U.S. energy policies that have passed through the Senate and are now before the House of Representatives was heavily criticized by ExxonMobil CEO Rex Tillerson, in a recent interview with the Financial Times.

The bill "almost defies any sense of logical or rational thinking," he told the Times, adding that it plays on the emotions of the American people.

"For a lot of good reasons, [people] are upset with the high prices of energy," he said. "People are reacting to that, and in a not very rational way."

Items on the bill include increases in the use of biofuels, punishments for gas price gouging by gas retailers, an increase in the fuel economy standards and support for research into energy technologies. However, an amendment to create $32 billion worth of tax breaks and incentives for alternative energy, supplied by taxes on oil companies, failed to pass.

"There's really nothing in that energy bill that I can tell is going to in any way alter the current energy supply or demand pricing situation. In fact, it runs a risk of actually making it worse; certainly in the short term it doesn’t do anything," Tillerson said.

In addition, Tillerson expressed his skepticism on the potential development of biofuels in the U.S., the report stated. While the increase in ethanol production to 7.5 billion gallons a year set out in a previous bill was achievable, going further would probably prove impossible with current "first-generation" biofuels, such as ethanol made from corn, he told the Times. The passed energy bill maintains a goal of 36 billion gallons of biuofuel production a year by 2022.

While "second-generation" biofuels, such as cellulosic ethanol, are believed to be the solution to the problem of biofuels competing with food production for feedstocks, they also present another problem, according to Tillerson.

"Switch grass or whatever you want to use, you've got to collect a lot of material, take it to a central location to be processed and the amount of material that you have to move around is enormous, to generate anything of scale," he said.