Yet the authors urge the federal government to inventory the resource potential and restrictions on all federal lands before pushing to open any particular area, such as the Arctic National Wildlife Refuge in Alaska. They also urge the federal government to impose passenger car gasoline mileage standards on sport utility vehicles, minivans and light trucks, which could save as much oil as Alaska produces. A critical part has to be demand management. Even more intriguing is the number of corporate managers who shared the report's findings on the shortcomings of market-based answers to energy supply and demand. The pathway to profits over the last decade has been to keep inventories as small as possible.
Energy markets are no exception.
Deregulation in electric power markets is eliminating the 20 percent capacity cushion regulators compelled utilities to keep available. So when the thermometer spikes in summer, so do electricity prices. Low inventories Gasoline inventories are so low they no longer give suppliers the opportunity to wheel extra product to pockets of shortage. Here, too, the result has been price spikes. Market-based solutions to energy supply worked well when there were large surpluses, whether they were OPEC's spare production capacity or an overhang of natural gas production.