Conservation Testimony on the Hill

With a compelling technology plan and a positive cost analysis in place, the next step was to hold congressional hearings to determine whether the program would be funded. Numerous high-level industrial, academic, and governmental executives with intimate knowledge of the airlines industry came to Washington, DC, to submit their personal statements as to the significance of the energy crisis and the importance of the NASA conser­vation plan. The Senate Committee on Aeronautical and Space Sciences led the hearings and planned to make its final conclusions known in early 1976.[66] [67] The testimony was important because it provided the opinions from a cross section of those invested in the success of the United States airlines industry. The executives used this opportunity to talk about the work of the Kramer Committee, the ACEE programs in general, and their concerns for the future of the airlines industry.

The hearings began September 10. 1975. One of the first to speak was Clifton F. von Kann, a senior vice president of the Air Transport Association of America (ATA). This was an organization that represented nearly all of the individual carriers in United States airlines industry. He said that aviation was more than just a transportation system, because it was one of the main sources of American power. It played a central role in military strength and was a key component of the domestic economy. But he warned that since “fuel is the life blood of the airlines… [and] the airline industry is a basic building block of the U. S. economy ” the energy crisis posed a serious threat to the Nation. If nothing were done to coun­teract it, this presented a danger for the entire United States airline system. Von Kann concluded by supporting the Kramer Committee and the NASA conservation program, saying,“The NASA program offers the prospect of major benefits to aviation economics as well as fuel conservation in itself. … We recommend approval."3*

The military also offered supportive testimony on Capitol Hill. Walter B. LaBerge, Assistant Secretary of the Air Force Research and Development, provided the perspective of the military branch in which fuel conservation proved most vital. The Air Force used 50 percent of the fuel allocated to the Department of Defense, and it had representatives who worked with NASA on the Kramer Committee. LaBerge said. “We are enthusiastic about NASA’s plan…. |It] w’ill directly benefit the nation and the Department of Defense.”3*

NASA’s leaders also provided testimony and made compelling argu­ments for approving the plan. George M. Low, Deputy Administrator, said that 78 percent of aircraft flying in the Western World were manufactured in the United States. Without a concentrated effort to develop fuel-efficient aircraft, this S4.7-billion export industry would evaporate. Low said, “Our world leadership in aviation is in serious danger today."[68] [69] [70] Alan Lovelace, NASA’s Associate Administrator, alluded to advances by the Soviet Union as an incentive to improve fuel efficiency. He indicated that the Russians had already developed a high-efficiency turboprop that could cruise at speeds near those of existing jets and that the United States should pro­vide the resources to keep pace.[71] Raymond Bisplinghoff. Chairman of the Kramer Committee’s Advisory Board, simply said that funds allocated to the development of aircraft conservation technology “was a better investment than the continued importation of middle-eastern oil.”[72]

A second day of testimony took place October 23. 1975. George H. Pedersen, a technical coordinator for the American Institute of Aeronautics and Astronautics (AIAA). presented the findings of the “AIAA technical hierarchy.” All of the members, he said, “strongly endorsed" and gave “universal approval” to all the proposals by the Kramer Committee. They agreed that industry alone could never achieve a program of this magni­tude by itself. Capital risk aversion in the airline industry prevented it from investing in long-term fuel conservation technology. Only NASA could achieve this, in their opinion. The AIAA’s only negative criticism was that alternative fuels were not a component of the conservation program.[73]’

Karl G. Harr, Jr., the president of the Aerospace Industries Association, added to the positive assessments made by the AIAA. He noted that while NASA would take the lead in the project, industry would also play a vital role in its successful outcome. The Kramer Committee envisioned the program as a joint effort between Government and industry’, and Harr agreed that while the research took place within NASA, the certification and production phases should be the responsibility of industry. This would be the best way to assure rapid technological development and technology transfer to industry.[74]

Industry representatives, including Boeing, Pratt & Whitney, and General Electric, all voiced enthusiasm for the program. A Boeing vice president stated in his testimony that “the NASA research program should, in the long run. result in major U. S. fuel saving [and) preservation of U. S.

technological leadership.”[75] [76] Likewise, a Pratt & Whitney vice president said that from his perspective as an aircraft engine manufacturer, “There is no doubt in my mind that the implementation of NASA’s plan can play a significant role in achieving the National fuel conservation goals for our air transport system ”4ft A General Electric vice president testified that his company “strongly endorse[d]” the NASA program: quite simply, he explained, it would help the United States reach “energy independence.”[77]

The Senate Committee held its final day of testimony November 4, 1975. Offering an international perspective was Yuji Sawa, a vice pres­ident from All Nippon Airways, which was the largest airline in Japan and the seventh largest in the world. According to Sawa, 80 percent of all Japan’s fuel was imported from the Middle East, and as a result, the embargo stemming from the October 1973 crisis threatened his coun­try and inspired drastic conservation measures. He concluded that if the United States developed a new generation of fuel-efficient aircraft, there would be a tremendous demand in Japan to start importing them to replace the existing fleet.[78]** After Sawa spoke, the president of United Airlines, Charles F. McErlean, presented his views of the NASA program. With 49.000 employees and a fleet consuming 1.5 billion gallons of fuel annu­ally. few other organizations had such a direct stake in the development of conservation technologies. He said that if the current energy trends con­tinued. it would “jeopardize our future,” explaining that. "This is not only a serious problem, it is a potentially crippling one.”[79] McErlean concluded by endorsing the NASA conservation plan as one important measure to bring the airlines out of their fuel crisis.

Not everyone who testified on Capitol Hill was as positive. From a technological perspective, the NASA fuel conservation program appeared sound and had tremendous industrial support. However, technologies are not developed in a vacuum. They are created and function within an environ­ment that can be as important as the technology itself to overall success. Of these external forces, the economics of aircraft fuel conservation technology was the most vital, and some criticized the Kramer Committee and NASA for ignoring these economic issues. Representatives from the Federal Energy Administration and the Energy Research and Development Administration (ERDA) raised these concerns when they spoke before the Senate Committee.

Roger W. Sant, an Assistant Administrator for the Federal Energy Administration, was the first to raise a red flag about the program and voice a concern that he thought was a significant oversight. The problem, from his perspective, was that external factors were not analyzed care­fully enough. “The report.” he explained, “does not address several impor­tant issues which are critical to an understanding of the ultimate worth or merit of the proposed NASA research efforts." Namely, even if the tech­nology were successfully developed, would economic factors be similar enough in 10 years to result in market demand for the new aircraft? Would the expense of building these energy-efficient planes be cost effective, and would the airlines be willing to make capital investments in them? “NASA apparently was not requested to undertake any such analysis of external variables,” Sant said, concluding that even if NASA achieved its technological goals, “it is not clear that this research program represents the most cost-effective use of limited Federal Energy Research funds.”[80]

Another voice of disapproval came from the Energy Research and Development Administration. Though it had a member on the Kramer Committee, during the testimony James S. Kane. Deputy Administrator, raised serious concerns. Although he stated that NASA had identified key areas of technological development that would be a positive force in air­line fuel conservation, he believed the project’s scope was too large. Kane said, “ERDA considers that NASA is asking for a disproportionate share of the money available for energy R&D.” Furthermore. Kane thought the United States should not put such a large emphasis on airline fuel to the neglect of automobile fuel conservation. I le presented compelling statistics to support his argument. The most recent consumption statistics showed that automobiles made up more than 50 percent of the total petroleum usage, followed by trucks and buses at 20 percent. Although the airlines were consuming 11-billion gallons of fuel per year, this only represented 7 to 10 percent of the total national petroleum consumption. With limited research and development funds available, Kane questioned the wisdom of NASA’s request of $670 million. He concluded. “The automobile should be supported as first priority with a much larger share of the budget.”[81]

A third, less-well-known organization. ECON, Inc., of Princeton. NJ, presented its economic assessment of the NASA program. Though it was more supportive than ERDA or the Federal Energy Administration, it did present some important economic warnings. The fuel savings costs were unquestioned. Based upon a З-month study, it concluded that the results of the new technologies would save 90.3 billion gallons of fuel or 2.15 billion barrels between 1976 and 2005. There were several economic factors that could potentially alter these savings. The most significant was whether the airlines would adopt the new technology, and how quickly the industry would render the old jets obsolete. Several factors dictated the replace­ment policy. These were the price and availability of fuel and the return on investment for the purchase and implementation of the new airplanes. If fuel constituted 20 to 35 percent of an airline’s operating costs. ECON warned “the most profitable price for aircraft may not embody the technol­ogy for minimum fuel consumption.”[82] Therefore, ECON recommended that the Government seriously consider offering economic incentives to encourage industry to adopt the new NASA technology when it is ready. Otherwise, its analysts feared, engineers might have successful technolo­gies sitting unused because future fuel costs might not make implementa­tion economically cost efficient.

After the final testimony, the hearings ended. NASA had completed the preliminary blueprint for the six conservation initiatives and could now only wait for Congress to decide what to do. Overall, one of the participants said, the hearings went well, and the “Senate audience was friendly.”[83]

The Senators seemed receptive to the proposals and understood the severity of the situation confronting the United States. But the question remained: Would the Government approve the program? The answer came 3 months later.