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Market News

 June 08, 2007
Consumers Want Energy Independence, Still Say 'NIMBY'

 New York, USA -- A new study by RBC Capital Markets finds that almost all Americans say the country needs to be self-reliant in its energy production, but don't want traditional energy plants in their hometowns.

In the annual survey, nine out of ten people said the U.S. needs to find ways to produce more of its own oil rather than rely so heavily on foreign sources and eight of ten said they were concerned about the country's energy self-sufficiency. Conflicting with that, 84 percent opposed the construction of an oil refinery in their hometown, 83 percent opposed the construction or re-commissioning of a nuclear power plant and three out of four opposed the construction of a liquefied natural gas facility in their city or town.

"We haven't built a new refinery in the U.S. in almost three decades," said RBC Capital Markets analyst Kurt Hallead. "Clearly the 'Not In My Backyard' phenomenon still prevails."

The survey also found that compared to a year ago, Americans are far more concerned about global warming and climate change, and are increasingly conscious of the harm carbon dioxide emissions are causing. The majority of those polled (68 percent) said they were in favor of carbon dioxide regulations, even if it meant higher energy costs, and 67 percent said they would also pay more for cleaner fuels than pay less for fuels that pollute. Still, only a third say they are spending more time learning about what they can do and two-thirds admit they need to do more.

"It's as if consumers are paralyzed by the magnitude of the problem, concerned about the price they will have to pay in their personal lives, and unsure that they can do anything about it," said Hallead. "To me, it's a clarion call for more public education. It's the only way for policy makers to address a situation where everyone wants energy self-sufficiency but no new traditional energy plants."

Moreover, while the vast majority of Americans support government activities to increase energy conservation programs, develop alternative energy incentives, and reduce the nation's reliance on foreign oil, there is still resistance to policies or initiatives that intrude on Americans' lifestyles or pocketbooks.

While the survey also found that Americans' number one concern was the quality of life for the next generation, concern for gas prices took precedence over "quality of the air I breathe" and climate change -- in large part because three quarters of respondents said it would be impossible to live their life as it is today without owning a car. Another concern voiced by 78 percent of respondents is about the price of gas and if they could afford to drive. In fact, sixty-seven percent felt that Americans are too concerned with how energy prices affect their wallets and are losing sight of protecting the environment.

"This crystallizes the dilemma faced by policy makers: the public clearly wants action, but not action that overly affects their way of life," said Marc Harris, RBC Capital Markets' Director of U.S. Equity Research. "One of the issues is getting people to practice what they preach. However, it was heartening to see that almost 70 percent said they would consider a hybrid car in their next purchase and 58 percent of SUV owners said they will try and buy a hybrid next time."

On the issue of alternative energy, a resounding 87 percent said the U.S. government needs to act immediately to encourage and reinforce the development of alternative energy sources with subsidies and incentives. Six in ten people said they would sanction the construction of a solar plant in their hometown and 57 percent would endorse the construction of wind turbines in their hometowns.

Among the other highlights of the survey are:
  • 74 percent of Americans said they would consider a candidate's stand on energy issues when voting in the 2008 presidential election, up from 49 percent who did so in 2004

  • When asked, "Will the United States find a solution to its energy problems in your lifetime?" 57 percent said no. Even the survey's youngest respondents (18 to 24 years old) did not believe the nation would find a solution to its energy problems in their lifetimes, with close to half (48 percent) expressing disbelief

  • Three-quarters said that companies who adopt and comply with environmentally friendly and energy efficient standards should receive a meaningful reduction in corporate taxes

  • One-third of SUV drivers said the publicity surrounding energy consumption and climate change has caused them to second-guess the benefits of owning an SUV.