products around the world and both consumer and exporters would benefit in both countries if it's opened up. do you agree with that or disagree? >> obviously for iran -- >> it's a simple question, mr. secretary. it's not a trick question. >> if iran has sanctions lifted, it helps their economy. >> and it would help ours too. >> i said earlier the only issue on oil exports in the united states of large scale relevance is whether or not there is a is a significant increase in as a result. in the current oil market that might be a difficult case to make. >> you think no more supply will be lost. we've been through that.

in 18 months there will be a new president, maybe not a new secretary of energy. one never knows. your qer was prepared based on this president's vision of greenhouse gases, their impact around the world and america's role. the next president comes in and has a different view with respect to that. tell me what remains of the value of the qer work that you did. >> essentially all of it. the qer is really aimed clearly at facilitating more clean energy but it's about energy security, resilience of the infrastructure. it's about energy, north american energy. it's got huge -- for the energy

infrastructure independent of the climate issues. >> yeah, i just -- when i stare at it i see the analysis. we don't disagree there. but it seems to me that most of what was in the qer was aimed at the intervention in the marketplace. you have several reference to classic market failure. i think much of the conclusions in the qer about how that infrastructure will be ultimately billed out and who determines which infrastructure will be built out is -- i just think -- i think it was a wonderful exercise. i'm glad we did the work with respect to infrastructure. the conclusions of the qer will need to be visited immediately with the next amendment. >> the gentleman yields back. that concludes the questions. we have one additional member, mr. cramer of north dakota who is not on this particular subcommittee but we's been so focused on this issues that he sat with us and we're going to give him the opportunity to ask five minutes of questions. >> thank you mr. chairman.

you know what, it does only take one good north dakotan to represent the states. so i thank the members. and i also want to thank you, mr. secretary, not only for being here but for at least agreeing to if not joyfully, i think you're a joyful person to holding one of the listening sessions in north dakota. it was a late request and a late addition to the agenda for you and secretary fox and others. i thoroughly enjoyed the time you were out there. i notice in the qer, there's a lot of reference to things you learned last year in north dakota especially as pertains to the transportation sector and some of the challenges particularly reflected the challenges for the railroads that move multi. commodities adds you know. you heard quite clearly and i think again indicated in the report quite clearly that there were challenges. but at the same time, one of the things i want to do is bring the record up to date a little bit. last august we were following on two record winters and two

bumper crops, two seasons in a row that sfrand the infrastructure for agricultural commodities. one of the bigger challenges is the fact not om was it a record crop but it was a late harvest due to weather. it was also late and a very wet harvest. there was a consolidation of all of those commodities and the additional, you know, moisture creating other transportation problems, like the movement of propane for example for grain drying. that perfect storm created incredible stress on the infrastructure. and along with, of course, 700,000 or so barrels per day of oil being moved by rail. so there's a fair bit of -- there was a lot of criticism last august. there's a bit of that reflected in the report. but just in the last ten months the storm has shifteds. i want to stress those points

and encourage you and the team to continue to monitor it on a regular basis. some of the things that were identified worked. the stp's weekly, the requirement for the weekly reports for example by the class 1 railroads has been helpful in transparency, allowed better planning. a warmer winter with a more traditional harvest season and frankly lower commodity prices have created more normalcy. and during which time -- i can be the railroad's worst nightmare but i also want to acknowledge when they have done their part. and i have to say for bnsf, our largest railroad by far, they're invested mightily in locomotive cars, certainly double tracking much of the region and the midwest. i want to encourage you to remain flexible and update the report regularly to acknowledge that this robust infrastructure

does exist. it's my hope and expectation that that additional robust rail infrastructure enhances all commodities. i think it's worth noting because of the stp reports we've noticed that they are pretty well caught up, caught up to the point where there's extra capacity and much like the electrical grid, it doesn't hurt to have a little extra capacity. but it also creates opportunity for growth. so you know, i would only probably ask that you know if we comment on my comments if you would like to but again appreciate my appreciation for your attention to the issues. >> thank you. we certainly appreciate it, your participation in the hearing in north dakota along with your senate colleagues. first of all, i think you've put your finger on really what was

the main driver of our discussion on this subject in the qer and that was the need for more data. to be perfectly honest, the railroads have not always been the most transparent in terms of data availability. and that's been improved. the issues around coal have been relieved. there are other issues as we know in terms of oil by rail that are being addressed and i might say that the -- with the department of transportation we have now launched the next phase of the study of relevance to crude properties and rail. it will take about 18 months before we're ready with that. but anyway, i think you're absolutely right. we've had some progress on the data front and that allows an eia is playing a role in there as well.

>> yes, they are. >> it's great. >> thank you. thank you again, mr. chairman. >> thank you. and that concludes the first panel. secretary moniz, thank you very much for your testimony and answers to our questions. we look forward to continuing to work with you on many pressing issues as we move forward. thanks again for your leadership. more road to the white house coverage coming up later today and tomorrow. this afternoon at 5:30 eastern, lincoln chaffee becomes the fourth announced democratic presidential candidate in arlington, virginia. he's a former republican turned independent and now running for the democratic nomination.

live here on c-span 3. and live tomorrow at 12:30 p.m. former texas governor rick perry also announces his presidential bid making him the tenth republican to do so and his second run for the gop nomination. the event takes place in dallas and will be followed by your phone calls. back now to this house hearing on energy policy as the panel of energy analysts offer recommendations on cross border infrastructure projects and liquefyied natural gas exports.

and we have mr. gerald keps, vice president of stream research and consulting. we have ms. allison cassidy the director of the domestic energy policy for the center for american progress. i'm going to call on my colleague mr. pitts of pennsylvania to introduce one of our witnesses, as well. >> thank you, mr. chairman. i'm very pleased to introduce mr. scott martin. introduced but is mr. scott martin, a county commissioner of lancaster county, pennsylvania, thank you for being with us, and you're registered.

i'm sorry there was such a delay in your testifying. we had to reschedule a little bit. i think you were in the german parliament at a time. and you're a professor, also at the university of bond. and so we genuinely appreciate your making this effort. and i'm going to recognize you to start off with for five minutes. and then after everyone has concluded, we'll have some questions for some of you. so mr. dozer, you're recognized for five minutes. >> thank you, mr. chairman. members, thank you for having me here --

in germany, i became a law professor subsequently i was director general of the federal office of the chancellor and the chancellor code. this is where my gray hair come from. then i was appointed three times to the german parliament's commission of inquiry. we have that in germany, can be appointed two parliament without the right to vote in the planry. in the u.s., i studied in spokane, washington, at gonzaga university. then i stayed longer at the harvard law school. the last time in dallas and texas. in houston, i'm a member of the advisory board of the association of independent petroleum negotiators. a month ago, i published a larger study of international

cooperation in global energy affairs. mr. chairman the era of abundance, as you say, opens up new opportunities of leadership for the united states and the world is looking at the united states. this reminds us also at least me that energy's not just about energy, it's about foreign affairs. it's about national security, it's about finances. but, ultimately energy has its own characteristics and dynamics. and this is my first major point point. foreign affairs, national security and also issues such as trade must be folded into the fabrics of energy politics and not the other way around. this is also my view as regards climate change.

energy politics, energy politics also calls for arrangements of its own when it comes to international cooperation. title 3 of your bill, the present bill represents an innovative modern approach, also from an international point of view. this title may even be strengthened by a transatlantic trade and investment partnership. recent events, and this has been addressed this morning in russia and ukraine and europe in general have underlined that energy independence will require safe energy supplies and will require political foresight and a robust, long-term strategy. together, we must understand the nature of that issue. europe, and this is not well known. europe as a whole will in the coming decade become more

vulnerable as our resource dwindle. this is europe as a whole. the forums as proposed in your bill will serve to provide a common basis. but i propose that we go further and establish a more advanced concept which i call the transatlantic energy agenda. we need to update and broaden existing arrangements with the new involvement of politics and the private sector. we have long standing arrangements for cooperation in foreign affairs in national security, in agriculture, for example. for energy arrangements of this kinds are lacking at the moment. and i think that ought to change. we need more exchange, we need better exchange, we need to know what we're doing. and we need exchange about best practice. america's abundance also lends itself to strengthening of regional partnerships. in europe we have particular

experience in this respect. since 2009 the european union has the competence to deal with the establishment of a single market. but the member have retained their powers to determine the energy mix the french made sure that no one touches their right to work with atomic power. this is a very complex jurisdictional situation which we have in europe. we now have a set of rules promoting competition in europe with liberalization with unbundling. we have less progress. and i think this is of interest here. so far with regard to internal and crossborder connections to overcome isolated domestic markets. the key concept which has been worked out in the last 24 months has been the idea of project of common interests as it's called. the new rules call for and i think this is of interest here

for a much more rapid process of approving permits. so far, that time don't be astonished took about ten years or more to have a permit for a transport arrangement. this is not going down to 3 1/2 years at a maximum according to the new law. must introduce one step authorities instead of the multitude of institutional arrangements we've had so far. the funds needed will be considerable. but i think the advantage will justify the costs, costs in terms of secure supply. new infrastructure urgently needed. more options for the customers. more better position negotiating position on the

international level when you negotiate with russia or opec or venezuela, i think the larger your market, the better it is. in north america i think a new task force by the nafta country similar to the european commission might help to elaborate a unified energy strategy. mr. chairman i conclude. in the past, energy issues have at times been a bone of contention between the united states and europe. sometimes a bitter contention. i think your bill with title 3 has the promise and hall marts of a new era of cooperation with tangible benefits on both sides of the atlantic. thank you very much for your attention. i very much appreciate this opportunity to express my views before your important committee. thank you very much. >> well, thank you, dr. dozer. and our next witness who is the president of the bipartisan policy center and thank you very

much for being with us and you're recognized for five minutes. >> well, thank you very much, chairman. the resilient members of the committee. on behalf of the bipartisan policy center, it's a pleasure to join you in this important discussion on the economic policy architecture governing our nation's abundance. my testimony can be summarized in three main points. first, i want to applaud the committee to strengthen north american energy integration and collaboration. north american energy security and self-sufficiency are in fact realistic goals that must be vigorously pursued and not taken for granted. my second point mr. chairman, is that increased north american cooperation is a critical component of a larger effort to enhance north america's role in global energy trade and project power and interests. and my third point is that we must seize the opportunity to translate this strength of abundance in a long-term and sustainable energy strategy and not allow this strength to

result in unintended come complacency. the disorienting challenge of managing success. i think it creates real opportunities that we need to discuss. so let me begin by saying a little bit about the energy integration and collaboration. i believe the provisions that promote that equality and sharing, that coordinate planning and improve permitting and inciting are all essential to achieving the promise of north american energy security. the opportunities are particularly pronounced in the case of mexico. while u.s. companies have much to gain in increased trade with mexico, it is hard to overstate the importance of energy production to the mexican economy. and the broader u.s./mexican relationship. even as -- after years of decline, energy production remains a source of high-paying jobs and responsible for a third of mexican government's overall activities. if modernization efforts succeed, energy production could be a significant driver of mexican economic development and individual opportunity.

and the implications here are quite broad. the bipartisan policy center believes we must reform our nation's broken immigration system. and while this hearing is not the place to discuss the challenges and sbi kaintricacies, there's no question that improved economic opportunity in mexico is an international component of successful and lasting immigration reform. let me turn now to the issue of siting. while our technology has evolved dramatically over the last decades, our permitting policies date back to the 1950s and 1960s and are poorly matched to our rapidly evolveing needs. we commend the effort to make the cross border permitting process more transparent and predictable. also commends the political judgment in crafting this provision to exempt the still pending keystone decision. it is time to have a broad-based bipartisan energy debate that is explicitly beyond keystone and encouraging to see the committee working diligently to avoid a

focus in favor of producing an agenda that can secure support and become law. i'd like to now move to the second point, which is a focus on the component that north america plays in the larger global picture. our nation's made i think, very good progress of late supporting lng exports. but current restrictions on crude oil are undermining our commitment to efficient markets they diminish our ability to promote free trade and fair trade and empower our adversaries who seek to use energy as a weapon. ky not build upon the studies except to agree there have been recent analyses that all conclude that adding reliable supply of crude to the global market will continue to exert downward pressure and protect u.s. consumers. my final point is on the challenge of how we use this abundance to promote our long-term sustainability and security needs. there's a broad critique of the abundance agenda that must be grappled with if we're going to

secure an effective national energy policy. the concern is that stable supplies of oil and gas are undermining investment. in a diverse array of technologies, to meet global demand to protect our security interests and to confront the risks of climate change. this legitimate concern, however, leads to very different policy pathways. the bipartisan policy center believes that additional action must be taken to confront climate change. but we reject the idea that we should pursue a low carbon future by erecting and undermining barriers to the resurgence of oil and gas production. perpetuating markets and creating transportation and infrastructure bottlenecks and reducing reliance on fossil fuels is not an effective climate change strategy. if anything it'll result in increased emissions. instead, as we pursue the benefits of abundance, we must be equally determined in conducting the research and creating the incentives to develop and commercialize the next generation of energy

breakthroughs from carbon, capture and storage, to utility scale solar advanced nuclear energy storage and an array of energy saving technologies. we must find ways to encourage greater investment despite the current low price environment. america's hydrocarbon renaissance has given us the gift of time. in closing, the bipartisan policy center looks forward to continuing to work with the committee as you build an architecture of abundance that grows our economy and confronts global and domestic and environmental threats. thank you. >> thank you and our next witness who has been introduced but mr. scott martin who is a county commissioner lancaster county, pennsylvania, thanks for being with us. you're recognized for five minutes. >> thanks, mr. chairman. and for the record, it's lancaster. >> what did i say? >> like burt lancaster. it's an offense in lancaster county. >> well, i'm going to let you

and mr. pitz work that out. but thanks for letting me now. >> you're welcome. thank you, mr. chairman and members of the subcommittee, it's an honor to be here. i serve on the board of commissioners. the united states must work to develop a coherent logical and clear national energy strategy. i applaud for his legislative framework, hopefully stimulate a wide ranging and bipartisan debate on a long-term energy agenda. common sense regulations, a modern and safe energy infrastructure, greater efficiencies increased exports, especially with lng to support our foreign policy goals. environmental sensitivity, minimal government involvement and utilization of free economic market principles. there are many positive developments and trends in energy. however, there are also numerous challenges and issues that urgently need to be addressed. the longer we wait to solve these issues will make them more difficult, expensive, complicated and controversial.

one of the most pressing priorities is energy independence. of course, it can only be achieved through renewed and recoverable resources. the regulatory environment is not hostile. excuse me capital is available to finance the expansion in both domestic and international markets are functioning properly. thankfully due to fracturing known as fracking and the oil and gas reserves america is now the largest oil and natural gas producer. as they should energy prices have been decreasing. the united states is increasingly able to export large amounts of lng around the world and especially to european countries. the volatile and tense situation in ukraine demonstrates why we need to build the keystone pipeline greatly accelerate the permitting of lng export facilities and pipelines and compressor stations. as noted above, a technological improvement has been the use of fracking and extracting natural gas from shale. the use of fracking in pennsylvania and the construction of necessary

infrastructures had widespread and significant economic development impacts. some of these include 96% of new energy hires were from the appalachian area. 45,000 new building trade jobs in that same region. 243,000 new energy jobs in pennsylvania, over 1 billion invested by the shale industry and road and infrastructure improvements. and including energy industry grants to community college and trade schools to train the workers needed by extraction companies in the marcellus shale with an average core wage of $68,000 a year. this increase shale gas production in pennsylvania has also saved the average pennsylvania family between 1200 to $2,000 annually. businesses and other energy users have benefitted from the greatly increased availability of cheap natural gas. the pennsylvania national guard and army reserve components, the garden spot public school district, and the shady maple companies all in our area have

experienced significant savings in the energy bills after switching to natural gas. cheaper energy will further a developed -- will further a develop industrial and manufacturing renaissance in america. in brief, lower energy costs create greater aggregate demand, decreased transportation costs lead to lower prices and american products are more globally competitive. the domestic oil and gas revolution can only be successful long-term if the necessary pipelines are quickly built and brought online. the williams company proposed to build 180-mile interstate pipeline known as the atlantic sunrise project from northern pennsylvania and connect it to the main u.s. gas pipeline that travels from texas to the northeast. the actual connection point would be in southern lancaster county. 37 miles of the proposed pipeline would go through my county. and we're talking about a $2.6 billion economic impact throughout the construction of this project. williams has been very cooperative and easy to work with as various concerns have come up.

over 100 route changes which is more than half of the original route have been made based on stake holder input. williams also committed to making the pipeline open access so that potential customers in lancaster county could directly access the pipeline. as you can imagine the project does generate controversy and opposition. one was parallel to the susquehanna river. working with several local organizations went to williams and expressed strong concerns regarding this route. found a new route and completely moved away from the sensitive areas and did so with native american sites and water source areas. lancaster county has five significant pipelines running through our county. many property owners are not aware of the pipelines that crosses their land. based upon discussions with local farmers having existing pipelines on their property williams including with their major u.s. pipeline has been very responsive to their needs. lancaster county is one of the leaders in agricultural

production not only in pennsylvania but across the country. but we also preserve more farmland than any other county in the united states with over 100,000 acres preserved. needless to say, the county ordinances that govern the program have allowed pipelines since inception. since november of 2014 there have been two elections where the proposed pipeline was in a de facto manner on the ballot and the voters were very clear in rejecting efforts to stop the proposed pipeline including an effort to have two townships adopt a community-based ordinance that would declare federal and state laws do not apply in these municipalities. i believe that many of these voters clearly recognized that this pipeline represents the concept of a greater good being served. in closing, i want to again, emphasize how incredibly important the ongoing energy revolution is to the future of the united states and, indeed the world. while renewables, greater efficiencies, clean coal, secure and smart grid are vitally important.

it is really the virtually unlimited supply of clean, recoverable natural gas from shale that will lead america into the future. thank you. >> thank you mr. martin. and our next witness is mr. gerald keps who is vice president of upstream research and consulting. and mr. keps, thanks for being with us. you're recognized for five minutes. >> thank you, mr. chairman. members, thank you for having me here. >> did you turn your microphone on? >> i'll do that. how about that? does that come across? okay. mr. chairman, members, thank you very much. i'm actually very pleased to be in front of you here today. because in my world, which is -- >> forgive me for interrupting. would you mind taking ms. cassidy's microphone and try that one?

>> again, my apologies. i hope this doesn't eat into my five minutes here. mr. chairman, members, thank you. i'm pleased to be here today because the world i usually am in is the business world. world and the exploration and production business. i'm a geologist, been in the business for 30 years. you decide whether that makes me objective or not in the business, but i'm fairly knowledgeable and representing the work, analysis, and experience of my colleagues at my company. i want to talk about competitiveness of the sector, and more than the volumes that have been produced, supplies from shale, just as important for you to think about is the competitive of the energy industry here, and the reason is that it means costs and reaction to market conditions. for example, looking at this

period with many benefits for the economy, consumers, et cetera, at one point, clearly, perhaps the saudis, others, thought the u.s. oil industry was a phenomena of high oil prices. that is not the case. in other words, many thought that this industry, the shale oil and gas industry could survive only with high oil and gas prices. that is not the case. this is one of the points today. by the way, we had low natural gas prices for about six years right now, and shale gas production has sustained, in fact, grown. that's critically important. and why is that so important? because when if comes to thinking about energy diplomacy, the idea that we can export the volumes that we have because we will match or meet their internal requirements is not just about volumes. what we're really exporting is competitiveness. i want to make that point is

that anything you might consider in terms of the energy diplomacy objectives or goals, which are actually quite admirable, they will be sustainable and viable as long as this competitiveness exists because it's not just offering to send supplies somewhere. the market place is what is pulling them. whether it's ukraine or parts of europe or mexico as i'll talk about next year, a great example. they would not be doing this if these supplies were from u.s. shores were not competitive in a lower priced alternative to other factors. and this is particularly important because if we define very simply what energy security is, which is really we would argue reliable supply at affordable prices. let's take mexico. right now, there's a lot of

interest in mexico because of the opening of the enp sector, exploration production because of over 70 years of monopoly of the state oil company going to be reversed, but that's actually not the biggest issue going on. the bigger issue is that fact that mexico imports a lot more natural gas for the united states. the committee knows they import 2 billion cubic feet a day. that number could go up to 5 or 6 billion cubic feet a day within the next ten years. it's a bigger impact because two things. one, all this will drive much more gas fire power generation if reforms work in the midstream and downstream in mexico, and we hope they will. that should result in lower energy prices for the entire economy. we don't know yet if it's 10% lower, 30% lower, but the impact on that on the mexican economy competitiveness, this is the big picture. it's not so much the oil side is what i'm trying to say. it's the gas side and what we're about to do right there. that's an important factor. now, it is said, and it is quite

true, that mexico has substantial natural gas resources, but in this case, the decision they made was if they tried to develop their own natural gas resources right now, it's so expensive that it made far more sense to import less expensive u.s. natural gas. that's a choice for competition. it's a choice for competitiveness, and, again, if you want to look at it from an energy policy program for the u.s., a tremendous success because as this goes forward, that competitiveness, that lower price in efficiency is what is going to have a larger impact on the mexican economy in a huge contributor to what has already been troubled at times, but a very successful u.s.-mexican relationship, so that's the arguments i want to put in front of you, that, one, shale production is not a high priced phenomena. also intrinsic to the supply volumes we have is the competitiveness of that. one, if it's part of u.s. energy diplomacy initiative, then that competitiveness needs to

continue. that's going to undergird all of that in order to be successful. timely, u.s. infrastructure processes of regulations, naturally, have to be equally competitive in order to allow this to be sustained. thank you very much for giving me the time. >> thank you, and the next witness is alison cassidy, director of domestic energy policy for the center of american progress, and thank you very much for being with us, and you're recognized for five minutes. >> thank you, chairman whitfield, ranking member rush, and members of the subcommittee, thank you for the opportunity to testify today. i'm director of the domestic energy. this is a nonprofit organization dedicated to improving the lives of americans through progressive

ideas and action. before i jump into my more specific comments on the energy diplomacy section of the draft, i would like to highlight a topic that is not a subject of today's hearing, but i think should be, and that is climate change, which, to me, is thee most urgent and challenging energy diplomacy issue of our time. climate change has become a priority in international relations because the climate science is so clear. a failure to act on climate change risks severe irreversible impacts on a global scale. as the committee considers the nation's energy policy and its interaction with the rest of the world, cap urges you to put climate change front and center of any policy you development. we can no longer afford to separate energy policy from climate policy. so with that introduction context in mind, i'll jump into a few thoughts on section 3104 of discussion of the draft about cross border energy projects. as you know, under current law,

entities wanting to construct or operate cross borderlines are required to obtain a presidential permit. this section of the bill eliminates that requirement, and instead requires the relevant federal agency to issue a ser tiff cant of crossing, that is, unless the agency finds the cross border segment of the projects is not in the public interest of the united states, and i have a few concerns about this approach. first, the new process presumes that the project is in the public interest, placing the burden of proof on concerned stake holders to demonstrate it is not rather than asking the apply captain to make the affirmative case that it is. second, under the new process, the applicant needs federal approval for the portion of the project that physically crosses the u.s. border, even if the project itself spans hundreds of miles.

finally, it omits review to just the cross border section of the project. this makes little sense because we know these projects have environmental impacts well beyond the border. for a truly transcontinental project like a pipeline running through numerous states down to the gulf coast, the current permits process is the only venue for the public and stake holders to examine and understand the potential impacts of the whole project that's under consideration. under the process established by the bill, the review would be fragmented, state by state, and no one other than the project applicant would ever examine the project as a whole. i also have a few concerns about section 3106, the export section. this section sets a 30-day deadline upon completion of environmental review for the d.o.e. to issue a final decision for any organization to submit natural gas to a nonfree trade country.

the united states is well on track to become a net exporter of natural gas. to date, they issued final authorizations to six facilities to export up to 8.6 billion cubic feet per day of lng, more than 10 % of daily u.s. natural gas consumption on top of what we already export to free trade countries like mexico. the existing d.o.e. permitting system appears to be working. it puzzles me, therefore, why we need a bill that seeks to fast track new d.o.e. approvals. to be clear, cap does not oppose lng exports in principle, but we have concerns about placing an artificial deadline on agency review of permit applications. congress should not preclude d.o.e. from taking the time it needs to make a consider and well-informed decision, particularly on the most difficult projects.

the stakes are simply too high for natural gas consumers here in the united states. last year, the energy information administration concluded that increased lng exports lead to increased natural gas prices, and these higher natural gas prices create economic winners and losers. certainly natural gas producers and employees of natural gat producers are the clear winners, but, for example, manufacturers that use natural gas as a feed stock would face higher energy costs. in short, the decision to export significant volumes of natural gas, even to the allies, is a complex one that should not be made lightly given the potential consumer impacts here in the united states. this decision is made even more complicated given the growing demand here at home for natural

gas in both the electricity sector and transportation sector. so if the united states over commits to natural gas exports via long term 20-year contracts, consumers here could pay the price, and that's why the deliberative process is so important. with that, i will end my testimony and happy to answer any questions. >> thank you, ms. cassidy, and the next is ms. emily hammond, professor of law at northwestern university law school. thank you for joining us. you are recognized for five minutes. >> thank you, chairman, ranking member, and distinguished members of the subcommittee, i appreciate the opportunity to testify today. in my testimony, i would like to highlight several concerns that undermine the discussion drafts, important goal of aup mied energy policy. these concerns relate specifically to sections 30102, 30104, and 3106. in short, those provisions fail to properly account for the reliability, fuel diversity, and environmental implications of energy policy. they fail to undertake work in a deliberative and well reasoned

manner. starting with the interagency task force. despite the lines between energy and the environment no longer truly exist, the composition of the task force has significant gaps that will hinder rather than help the development of a comprehensive energy policy. most critical is absence of agencies within environmental expertise, but other key agencies like those whose missions relate to jobs, to the economy, and to transportation are also omitted from the task force. as demonstrated by the qer, which we heard about this morning, all of these agencies can successfully work together towards unified energy policies, and administrative law will show that when agencies collaborate in this way, they are more successful in that they tend to have broader stake holder support and the criteria's plan should include environmental issues and especially climate change. failing to do so will only deepen the current dysfunctions in our energy regulatory system and in the energy markets. sec, the authorization for cross border infrastructure projects does not make clear how d.o.e. implements authority differently

from how it currently does under the presidential permit framework. current procedures do account for environmental issues and those should be retained. i note as well that the provisions striking portions of the federal power act and in particular section 202f threaten to undermine important backstopped authority that the federal power act retains that allow it to ensure grid reliability for projects that cross international boundaries. i urge the subcommittee to carefully re-examine the striking provisions of this section. finally, the applications of are concern. even if they are able to act quickly in circumstances, it needs flexibility given the very complex issues at stake. opposing a rigid deadline threatens more delay. first deadline suits, which are contemplated by the discussion draft tend to impose additional delays, even if those suits are successful. and second, with stakes so high with such engaged stake holders, judicial challenges are inevitable, all right.

we can predict lawsuits no matter doe's decision, and if d.o.e. is rushed in making a determination, the record is less likely to be carefully developed. the agency's reasoning may not be clear, and, again, it's likely to be more vulnerable to remand and in position of further delays. to summarize, the relationship between energy and the environment must be considered as the united states seeks a policy. careful to administration procedure in role in promoting good government must accompany any new energy statutes. if we move forward with u.s. energy policy with these principles in mind, we can make substantial improvements for the future. thank you for the opportunity to testify today, and i look forward to your questions. >> thank you, and that concludes the opening statements. i just want to make an announcement that we're expecting some votes around 1: 30 or so. there's only six members here, so we each get five minutes,

that's 30 minutes. i think that we can make it through and give you all an opportunity to respond if we go efficiently and quickly, so i'm going to recognize myself for five minutes to get mine in, bobby, and then we'll go from there. ms. cassidy and ms. hammond both made comments about climate change, and that is something we are all concerned about, but in the federal government there's 68 initiatives on climate change. there's been a total of 36 or 37 billion dollars spent by the u.s. government alone each year just on climate change. so the difference is we have with president obama truthfully is that he views it as the most important issue facing mankind, and some of us have different views that a job, access to health care, clean water, affordable energy, economic growth are very important also.

i appreciate y'all's comments, and now mr. palone is coming, that's another person. i have to hurry. okay. i want to make that comment. now in france, there's a large percentage of electricity produced from nuclear, and germany made the decision, i guess, to stop all production of energy by nuclear. is that still the policy in germany? ms. cassidy and ms. hammond both made comments about climate change, and that is something we are all concerned about, but in the federal government there's 68 initiatives on climate change. there's been a total of 36 or 37 billion dollars spent by the u.s. government alone each year just on climate change.

so the difference is we have with president obama truthfully is that he views it as the most important issue facing mankind, and some of us have different views that a job, access to health care, clean water, affordable energy, economic growth are very important also. i appreciate y'all's comments, and now mr. palone is coming, that's another person. i have to hurry. okay. i want to make that comment. now in france, there's a large percentage of electricity produced from nuclear, and germany made the decision, i guess, to stop all production of energy by nuclear. is that still the policy in germany? >> that is the policy. we decided three days after the fukushima event in 2010 to phase out. we had an earlier change in 2000

with another change in 2009, and fukushima, the key event in germany, and at the moment, the current situation is that half of the nuclear plant as have we had an earlier change in 2000 then another change in fwn, and fukushima is still the key event in germany. at moment my prediction is the current situation is that half of the nuclear plants have already been phased out as of 2011 and the rest, eight of them are still in operation. they will be phased out by 2021. >> of course, you have been -- in germany they've been moving very quickly to renewable energy wind, solar, whatever. so what has the result been? i mean, has it affected your reliability? the retail prices of electricity or not? >> it's affected the price of the consumer considerably. i think the price went up by 30% for electricity for the private households.

perhaps one conclusion is, and i'm not here taking any particular position, if you change policies do it in a pragmatic manner without too much momentary intervention, i think the change in germany has forced us to react very quickly. it had some rather unintended consequences at the moment. we are the main importer of u.s. coal. now, of course, this is a little bit odd and awkward to have more coal. >> i was told that last year two-thirds of u.s. coal exports went to europe. >> correct. so we're supporting west virginia. a consequence of our decision to phase out nuclear was de facto to promote coal.

for the moment, my prediction is this policy will not change, none of the major political parties including the one to which i belong intends to change. however, i think if i listen to correctly to what my wife tells me, opposition among the people is growing to this policy. the question is is that affordable what we're doing at the moment in the long run? germany has many issues as most other states. we need more schools. we need better universities. we need more streets. and the question is can we focus our budget in the way we did on one issue alone which is -- >> in your testimony when you were talking about europe being more vulnerable, is that what you were referring to? >> that is correct. >> the policy about the renewables and the push -- >> policy about renewables

together with the policy of phasing out nuclear power means that we need more energy in the future as regards gas. we have a very special situation. we can get more gas from russia, from iran, from algeria, or at the moment from norway, but norway is about to peak. in other words, our choices are not considerable here. i would like to come back for a moment to u.s. policy. the u.s. has criticized us, of course, for being dependent too much on russian gas. correct, almost 40%. at the same time now, of course, in an era of abundance one would hope, the europeans would hope that the united states allows for more gas to be exported to europe in this situation where we need stronger support with

our alternatives, and i think even small additional imports from the united states would help in a symbolic manner. in other words, the position in europe that you hear quite often is on the one hand u.s. criticizes we are too dependent on russia or iraq or whoever, on the other hand the u.s. does not allow and facilitate exports to europe. i think this is a position that may be reconsidered. >> okay. at this time we're going to recognize mr. rush for five minutes. >> i want to thank you, mr. chairman. mr. chairman, i just want to take a moment to welcome back to the committee miss cassady. she served for many many years as an expert staffer under our former chairman henry waxman, and she was on this side of the table. and now she's on that side of the table. but i just wanted to welcome her back, so good to see you again, and you're continuing outstanding work.

thank you so very much. i want to ask you a question, and also ms. hammond. it's in response to comments from the chairman. in your opinion, and both of you can respond, are energy and environmental issues inherently related, and why is it so very, very important that any kind of comprehensive energy policy also integrate environmental concerns in that policy and anything specific with the -- [ inaudible ]

so i'll ask you either -- both of you the question, please. >> thank you, mr. rush. >> did you turn it on? >> i did turn it on. shall i project? >> yes. all right. >> you have a great voice. >> yes, it is true that energy decision-making inevitably impacts and is impacted by environmental concerns. the energy sector is where we see the greatest greenhouse gas emissions. that is pure fact, and the question is what to do about it. if we make energy decisions that do not consider environmental implications, we will see further market dysfunctions. we'll see the loss of fuel diversity, and we will see degradation of the environment.

my recommendations at the very minimum are that the task force include environmental agency and that environmental considerations are enumerated as the criteria for the consideration of the plan itself. thank you. >> thanks. >> i would just add to that, the energy infrastructure decisions we make today will last decades. so we decide to build a pipeline today and new energy production facility, we're locking in decades of new emissions or not. and that is why it's very important to consider whenever we consider energy policy we should consider climate policy as well and think through how will this energy project affect negatively or positively toward a zero-carbon future. >> the gentleman yields back. because we now have call votes i'm going to reduce the amount

of time to three minutes for everyone so that hopefully we can give everybody a chance. mr. olson, you are recognized for three minutes. >> thank you, mr. chairman, i'm with you. i apologize you got behind an energy superstar and now votes in the hearing, in this hearing room about 2:00. so i have one question for you mr. grumet. it's about mexico. they are on the verge of revolution for energy. changes, changes, changes. i moved to texas in 1972. i saw the stranglehold opec had on america firsthand. 1979 i just got my license. i was sent down to get in line for gasoline. gasoline depended upon -- a long line. get gas, depending on the last digit of your license plate. if it was an even date, go on an even day even number. long lines. gas prices doubled. they had a stranglehold on us.

i see a vision of opec going way replaced by napec. my question is sir, what's the one thing we in congress can do to help make that reality, make napec ahead of opec? >> thank you for that question. i will note that usually you put the warm-up before the rock stars. all right. i'm back. i think you make a very important point. we used to look at our headlines that opec was having a meeting and there would be a chill through the land. now they can meet or not meet. doesn't matter to us. if in fact we seize the opportunity of abundance. and i think our opportunities with mexico are profound. we have to give a lot of credit to president nieto for trying to reverse 60 years of investment policy that basically discouraged first world technologies. i think the opportunities to spend a lot of time working with mexico on something that is pedestrian but incredibly important and that is data

quality. the ability to have north american energy security depends on having good data shared analysts, shared understanding, and a transparency across our analytical platforms that's a very boring but incredibly difficult and important thing to do. our energy administration here is the gold standard. and i think we really should spend a lot of time. that's going to require some resources if we want mexico to join us. if we had that shared data foundation and we have thoughtful laws that as our colleagues have suggested provide time for environmental deliberation but then actually require a decision i think we can have an integrated energy system that will raise -- >> shared data, number one. in congress that's the best thing we can do right now. >> i think that's something you can actually get done right now. >> i like that. yield back, sir. >> the gentleman yields back. at this time the gentleman from new jersey for three minutes. mr. pallone. >> thank you, mr. chairman. i just wanted to follow up on a few statements made earlier

about section 3104. this makes and end run around the policy act eliminating meaningful review of the environmental impacts, narrowing the review to the cross border segment of the energy project. the tiny portion that physically crosses the national boundaries, so ms. castsady does limiting nepa review to just a small cross-border segment make sense to you. and what are some of the drawbacks of looking at just the cross-border segment of the pipeline or transmission line? >> thank you for the question. no, it does not make sense to me simply because if you look at the controversial pipeline and other projects that we've examined over the last few years the controversy has never been around the impacts at the border. we all know even the best constructed highest technology pipeline accidents can happen. it spans through hundreds of miles and aquifers over private and public lands and

an environmental review the purpose of an environmental review is to make sure that policy makers have all of the facts about the impacts of -- the potential impacts of the project over the entire course of the project, not just the small part at the border. in order to better understand how to mitigate those potential impacts. so in order to understand the potential consequences of a project we need to look at it in its entirety and not just at the border. >> how about the legislation's presumption that cross-border projects are in the public interest? how would looking at just the cross-border segment impact an agency's ability to determine whether or not a project's in the public interest? >> the presumption of approval stacks the deck against a stake holder who has legitimate concerns about whether or not a project is in the public interest. it forces the concerned stakeholder to make the case that it is not in the public interest rather than forcing the applicant to make the case that it is. and that's just a higher burden of proof. and the way the bill is written,

since it's so focused on a very narrow part of the proposal, it doesn't look at all the potential impacts. it's going to be much harder for a concerned stakeholder to make the case that this tiny little part of the project is not in the public interest. >> well, thank you. i think these energy infrastructure projects are more than just a border crossing. they're going to last for decades and fundamentally nepa requires us to look before we leap. that's just basic common sense. we should not be carelessly narrowing or creating loopholes in the law and i think we need to understand the impact of these projects before their construction so that we can protect public health and safety and the environment and i think ignoring the impacts is not going to make them disappear. so thank you again mr. chairman. >> at this time recognize the gentleman from pennsylvania mr. pitts for three minutes. >> thank you mr. chairman. commissioner martin, lancaster county doesn't have any wells of marcelus shale being drilled in

it. probably the nearest well is 100 miles away. but how is lancaster county benefiting from marcellus shale, the boom you mentioned even if there are no wells being drilled in the county? >> first and foremost, what we have seen is one pennsylvania putting forth an impact fee with monies that were distributed back not only to well counties but also to counties who end up having pipelines. those kinds of funds that are coming back are used to conserve open space, preserve ag preservation easements, and also really replace structurally deficient bridges. but we're also seeing the economic impact here. we have i.t. companies that do data mapping of pipelines and wells that have grown dramatically. engineering firms. one of the larger engineering firms in the marcellus shale region more than doubled in size. over a two-year period they bought an additional 75 vehicles. i used in my testimony examples of the pennsylvania national guard or shady maple.

shady maple saving over -- it's a smorgasbord. if anyone's never been to one i highly recommend it. $175,000 a year in energy costs which then garden spot school district saw which is in the same area and said we're going to tap in and they're going to realize those savings. now, we'd like to see more of it. unfortunately, about half of pennsylvanians done have access to that natural gas. but given the premise of the open access nature of pipelines you will start to see more of these entities like the pennsylvania national guard at ford town gap being able to tap in and realize the savings. where we expect to see most of it and where we hear from a lot of our constituents is especially in the area of manufacturing, especially those who are heavily reliant on energy to do that. we have companies that spend over $3 million a year in energy costs but they are nowhere near the nearest pipeline. i think we'll see further opportunities coming forth. i just want to add, congressman one of the -- two of the great things i see is you're now able

to get an education in pennsylvania in the petroleum and gas industry that you had to go to like texas tech to used to be able to get. they're investing in areas i think $2.5 million grant from the industry to lackawanna community college. two-year program. costs for that two years, about $22,000. when they're coming out of that program, their starting rate is like $68,000. so those are the types of things you are seeing. these are good middle-class jobs that not only use your head, but they also use your hands, and we're seeing that grow, and that's something we hopefully continue to see grow, not only in lancaster county, but throughout pennsylvania. >> thank you very much. my time has expired. >> at this time, i recognize the gentleman from texas, mr. green, for three minutes. >> thank you, mr. chairman, i appreciate hearing from the county commissioner. my accent gives me away, but obviously, every school in texas has energy courses from the community colleges all the way up to not only tech texas in

lubbock but u.t. and a&m and university of houston and everywhere else. ms. cassady, i want to welcome you back to the committee. i know you're familiar with the nepa regulations promulgated by the council on environmental quality. and agencies specifically prohibited from segments projects known as piecemealing. the code of federal regulations states proposals or parts of proposals related to each other closely enough to be in effect a single course of action are evaluated. the discussion draft requires the state department to promulgate rules on cross-border pipelines. and you heard secretary moniz say the agencies are required to do it. ms. cassady, wouldn't the federal agency in charge of the environmental review be charged with the nepa review that satisfies eceq regulations in looking at the whole project? >> my understanding of the bill is that the nepa review only applies to the cross-border

segment of the pipeline project or the transmission line, and so the federal approval only applies to that portion as well. therefore, nepa would only apply to that portion. there would be state by state reviews if it was passing through a state. in terms of federal review it just applies to the cross-border segment. that's my understanding of the legislation. >> well, shouldn't the cross-border -- so much of our nepa process is also done by other federal agencies and a party to it. for example, if you have a pipeline coming from texas and eagle ford to mexico, that cross-border pipeline, you know state law covers it on the property that's not federal but it may be crossing federal lands and the nepa process would come into play on that. granted, the cross-border which is international, we own that part of the border, then they would do it. but you don't think the bill calls for them to look at the whole project?

and it may not be one agency doing it, but there will be other agencies doing a nepa process on their -- on what they're required to do in that pipeline from whether it be at eagle ford of course into mexico. that's what worries me because i know, and my colleague from new jersey said that the nepa process is not covered. i think it is because if it's not department of energy, for example, for electricity transmission it would be another federal agency if they had the authority in there or in some cases state agencies. so the nepa process would be included. and mr. chairman i know i'm almost out of time and we're almost out of time -- >> mr. green that's our view as well, and we would love for our staff to sit down with ms. cassady in more detail. but it is our understanding this does not change the nepa process. >> i have to admit in my few seconds i have a problem with

the state department. we have a company in text terks a canada pipeline that was dormant. they wanted to change the name because they bought it and their goal was to not only bring crude oil from canada but it was also to attach into the united states from balkan and the state department aside they needed to review what was on u.s. property. now, i want a federal agency looking at it but the state department shouldn't be deciding whether the pipeline out of balkan is good or not because granted we're getting crude oil in trains into houston, texas because our refiners do that. it is so much safer and easier to put a pipeline in there than it is to bring those 100-mile trains to bring crude oil from canada. >> gentleman's time has expired. recognize the chairman from virginia mr. griffith for three minutes. >> thank you very much. i appreciate it. all right. i'll take anybody who can answer this. i suspect it will be mr. grumet or ms. cassady or ms. hammond.

are you all familiar with the regulations relating to production of electricity in mexico by coal? no is a fine answer. if you don't know, you don't know. nobody knows? because the reason i ask the question is that part of the proposal here, and one that i'm interested in has electric transmission facilities. it's not just pipelines. and one of my concerns is that we're putting coal miners out of work in appalachia. lancaster down our way. it's not app plachiaalachia. it's appalachia. and we are putting coal miners out of work in appalachia, but if we allow lines to cross over from mexico using not as good a goal with not as good a process, and not as clean of plants, what gain have we made environmentally? i think this is a case where,

while ms. cassady and i are not going to agree on much we might actually agree on that that that might be a concern. mr. grumet, do you have any thoughts on that at all? >> you have make a very important point and dr. dollser's testimony referred to it as well. electrons and molecules do not have concern about arbitrary political boundaries so that's why we have a shared solution that brings the technology of the united states to bear on the issues in mexico. we have to have shared agreements. i'm not going to try to get into a lengthy conversation about regional climate action in 60 seconds, but i think there's a real opportunity to actually lift the mexican system so that it actually has parity with the u.s. >> and i certainly don't mind lifting up the mexican system, but i am reminded of the old nasa study that shows it takes ten days for the air to get from the middle of the gobi desert to the eastern shore of virginia so if we're going to eliminate coal waiting another 30 or 40 years on asia just really means we're putting our people out of work and we're not really doing that much for the overall northern hemisphere air.

>> all i will say is we fundamentally have to find a way to burn coal in a way that meets our security interests and our environmental sxirnts there's one way we can do that if we invest the resources to get it done. we're not doing that right now. >> i agree with you completely we can do more and we should do more. i look forward to working with you on clean coal technologies. i yield back. >> and dlr nothere are no other questions. so thank all of you once again for your patience. and we look forward to maintaining contact with you and continuing to work with you as we try to bring this legislation to the committee. i'm also asking unanimous consent that a statement from the canadian electricity association be submitted for the record, and without objection so ordered. is this it? okay. we'll keep the record open for ten days for any additional material that needs to be submitted. once again, that'll conclude today's hearing. thank you all, for your interest

and mr. dolzer, thank you for coming all the way from germany. more road to the white house coverage coming up later today and tomorrow. this afternoon at 5:30 eastern former rhode island governor lincoln chaffee becomes the fourth announced democratic presidential candidate with his campaign announcement in arlington, virginia. he's a former republican turned independent and now running for the democratic nomination.

live here on c-span 3. and live tomorrow at 12:30 p.m., former texas governor rick perry also announces his presidential bid, making him the tenth republican to do so and his second run for the gop nomination. the event takes place in dallas and will be followed by your phone calls. a look at the changing landscape of television technology and the internet and what it means for consumers. with comcast ceo brian roberts. former news corp. president peter chernin aol president tim armstrong and former fcc chair michael powell, who now heads the national cable and telecommunications association. this was part of the internet and tv expo held in chicago last month. >> thank you. you may be wondering what these chairs are doing here. we decided to do something different with the association this year.

michael i know last year came out and put on a big old show. this year he thought maybe he would snapchat the whole thing or perhaps periscope it, although that would have been in bad taste. i know you all don't want another power point, as exciting as those can be for everybody. so what we decided to do was an actual interview with a real reporter. that would be me. and i also play one on television, on hbo. we're going to do an interview and later we're going to do a bunch of interviews. and throughout the show peter kafka, who also works for recode-s going to be interviewing some figures. but we wanted to start out by talking to michael. and i brought my own chairs. these are the red chairs of the code conference. before that it was all things d, and many, many people have sat in these chairs, including steve jobs and bill gates and president obama, and so we thought it was appropriate that we put michael on the hot seat to begin the show. michael? come on out. ♪

>> were you scared? president obama -- >> no, i wanted to be left of center or something. >> oh, no. i hope not. that's a horrible thought. no, we have them cleaned every -- >> that's good to know. >> some of those internet billionaires can be very messy. anyway, we're going to be talking about a range of things today and all kinds of things have happened in the cable industry. let's start off with the concepts of what you're trying to chain, because the industry is changing rather rapidly and suddenly even more than it seems, especially because of digital challenges you're facing? >> i think that's right. i think the central reason we rebranded this show and really changed its mission, if i were to put it in a sentence is to expand our peripheral vision. i think video has become so much more dimensional, much more

textural and there's really this fascinating intersection of television and technology all brought about by internet functionality, wired and wireless. it was time for our industry to look beyond its traditional bounds and its traditional players and invite them and include them in a show that attempts to be the seminal place to have a conversation about the trends that are taking place in this exciting and changing industry. >> sure. it can be said this internet thing has been a big deal with the kids for a while now. kids seem to like it. >> yeah, the kids seem to like it. >> people seem to be using these crazy technologies. when you talk about peripheral vision, is that enough? what's been happening has been happening for a while. it's happened in the music industry. all kinds of industries have been disrupted rather substantively. even in san francisco now the food industry, all kinds of things due to technology. has the cable industry responded quickly enough? because people are talking about millennials decoupling from

cable and watching in different ways. >> i think they've responded but i think it needs to be accelerated with a new kind of urgency because as you say i think we're really starting to see sort of really exponential leaps in transformation as those homo digitais, those children who've grown up only digital begin to move into the older generations and are consumers. they're setting the tone of a new kind of behavior that i think is non-traditional. when i look at kids today i think that they -- you can get fascinated by the technology, but you really should look at their behavior, i think teenagers are doing the same thing teenagers have always done. they're passionate about community. they're passionate about their friends. they're passionate about watching each other and building friendships around that, and i think what's really come into their world is the ability to have real life be entertainment. to have the video or moving

pictures of people doing things profound and people doing things idiotic. but they're able through the creation of new screens and devices and a connective tissue through the internet to really be continuously plugged in to their friends and their community. and so what's competing with traditional television is real life. the ability to document, share, and propagate that. >> what happens to an industry in that situation. it would seem that if people are not linking to cable, they're not having a relationship with cable in any way, they have bad feelings toward it, or don't even use it. i don't think it's bad feelings. i think my kids watch -- they have a different attitude toward things, when my son was four, for example, we bought a new large television. when it got home he started hitting it. i thought he had mental problems at this point. he kept hitting the television. i said, what are you doing? >> swiping it? >> and he said it doesn't move. it doesn't do what i want it to do. he was so used to a swiping situation. a different situation. my older son, almost lives on

vine. vine is entertainment to him. which is twitter's thing. now he's periscoping almost all the time. most of it inane, true. but -- well, not to him and his friends. i'm wondering, how do you meet that challenge when the behavior's change so rapidly. >> i think the first thing you have to really be thoughtful about, you have to go to the physical locations they're going. i mean, for the better part of the television history, there was one consumer electronic device that was central to you being able to consume content and it was the television set. recent studies have shown real declines in people watching on that particular vehicle, it's really just been in the last decade that we've handed our kids smartphones, tablets, laptops, and so there's really a proliferation of screens. i think what's missed is more intimate screens. meaning my kids can cuddle up and have a sphere unto themselves within that screen. you have to get to those screens. i think one of the things cable has tried to do as round 1 is to be able to port their content

off their systems into those devices. i think that's a first step that's really, really important. then i think you have to think about how do you exist as a companion to the self-published self-created kind of content? because that lives on the internet. and if you want to be part of that experience or companion to that experience, i don't think it's enough to ask the consumer to constantly completely change ecosystems to go from watching periscope or their friends doing something to watching "game of thrones." i think you'll see more integration. >> speaking of periscope and "game of thrones," a lot of people periscoping the first "game of thrones." a lot of piracy. the fight. and then the ceo of twitter seemingly talking about what a victory it was. do you look at that as a victory? the ability to live-steam anything you want. meaning you can put a camera in anybody's face at any time and reach -- the other day i periscoped my lunch by the san francisco bay and i got 5,000

viewers who were very interested in my lunch. >> exciting, i missed that one. >> it was. it was a gripping episode of shrimp salad. how do you imagine what happens? because it does create real problems for the industry. they sold this site for a lot of money and lots more people watched it because of that. >> yeah, i think -- the way i think about disruptions is, they tend to come with an enormous amount of good and an element of bad like all things. the good is an amazing experience in which you can have this dynamic, almost spontaneous experience with people from around the world who are documenting and cataloging events that you would never have had access to, but what comes with that is, you know, in the instance you're talking about, there are opportunities to violate intellectual property and copyright, there's opportunities to frustrate models that have been built and a lot of people have invested in. those fighters were paid hundreds of millions of dollars.

premised on the television rights that were associated with funding that fight. and i think the second thing i find to be worrisome is what privacy means in a space like that. i've been playing with periscope and some of the snapchat stuff and what i'm always intrigued by is not the people doing it but the people being caught while they're doing it. the people who didn't agree to be broadcast around the world who you're observing having a drink or doing something else in that confines. i think society's going to be working through the meaning of that for a long time. but i think that potentially has a negative side. >> onewhat of the things that companies are going to be most important -- you talked about bringing these digital companies in. is it google with an ability to do a lot of these things or amazon making shows or apple? who is the most powerful player right now from your perspective? >> i don't know if i'd say who's the most powerful. i think there are a number you that really should have to intensely follow. i think google you always have to intensely follow. not only because of their

extraordinarily dominant position in the search ecosystem. they are how we mostly find things. and they are always looking for ways to index tag, scrape, and identify anything in the digital space. through their algorithms. and i think that's a very very powerful function that will exist. i also think the youtube property is fascinating. >> yeah. >> and i think -- you know, the first time i ever saw youtube was my 12-year-old who showed it to me. and i remember being sort of amazed at that. and i think if you look at the soaring of video clips and miniseries and shows that are being produced i absolutely think it's something to watch. and i also think amazon for a similar reason what i'm intrigued by by both of those companies is the video isn't necessarily their primary business. >> no. >> they are using video to drive very, very profitable businesses that pull through. amazon wants me to be a prime consumer and buy my shaving cream as well as watch a television show. and so i think they can take

certain risks burn money in certain ways that would be harder for a traditional company. >> they're not actually very, very profitable. that's the whole point. >> true. >> for decades now. >> but the market lets them take the kinds of risks that if you were an incumbent company in a cable industry would be harder to get market permission to take kinds of rixz and i think that's challenging. then i think you have to watch just to finish your question, the real sort of ground-up digital disruptors. i think if you haven't seen the discovery functions on snapchat if you've never looked at a periscope or played with vine or meerkat, i think you owe it to yourself to look. there's an amazing amount of creativity going on there. i don't know how much of a business it is or it isn't. but i know that it is meaningfully differentiated conduct, content, and behavior that you would be foolish not to be a viewer of it. >> they're completely entertaining. you can spend hours. >> they sure are. >> watching people fall down. when you're in this environment,

though, what does the modern cable -- two things. what does the modern cable look like and what does the modern cable company look like? because at some point it will just be about a member of the dumb pipes that everybody was worried about. the connectivity is what's important and everything else rides on top of it. >> i think you've touched on it. the first thing that cable distribution is about is they are the country's unequivocal leader in the broadband infrastructure that makes all of this possible. and as the demands for video, disruptive applications soar, the necessity of that network being high quality increasing in capacity heavily invested in is going to be even at a higher premium. i think the greatest gift to the country the cable industry has as distributors is providing that infrastructure and continuing to grow it. currently at a rate of almost 50% increase of speeds per year. $16 billion last year alone in investment to continue to make that quality experience possible. i think that's going to be an increasingly important part of the cable business.

i also think that we shouldn't sort of declare its demise prematurely. there are 102 million cable multichannel subscriber households in this country. that's not going to drop down to five overnight. i still think there are high-quality premium-type programming and live events that continue to be driven by an infrastructure that has kind of the proprietary quality of service, service commitments that a cable infrastructure does. the internet's wonderful but you get what you get. as sling discovered when it had congestion problems when you get a huge demand. >> they have legal problems too. >> they have legal problems as well. but the internet is best efforts. and your bits are competing with all kinds of other bits. and there's not a lot of permission within the regulatory structure to manage those bits in any kind of priority. i still think there's going to be needs for highly engineered, high-quality proprietary networks that can take advantage

of those things. >> in that vein customer service issues customers liking the internet, the net neutrality, had a lot to do with that idea of customers -- they played that rather well, the difference sides. >> sure, they did. i'm a firm believer that words and messages don't work if you're not liked. when i was in the army people used to say oh, george s. patton said i don't have to be liked to lead. that's completely foolish. i think you have to be well regarded by your customer base. i think you have to have a trusted relationship with them. you have to build that. and if that is frayed you're just right for every public policy fight to be turned against you just based on reputational critique. so i think the good news is i think this industry is highly conscious of that problem. they're very self-aware. they're not delusional about it. and i think there are a number

of very important committed efforts under way to change that perception over time improve the quality of the product and improve the experience. and i think what they have to recognize or we do recognize is that even if you're improving at a rate of 3x the consumer acclimation and expectation is increasing even faster. one of the things the internet has done is really raise the expectation of consumers and the way they consume digital content. they want it here now on any device. they want it to be unfailingly reliable. they want to innovate every six months, not every 18 months. so if you're going to be in that game you have to be in an innovation cycle that's twice as fast. >> that's true. i was on the plane yelling about the internet activity. the old louis c.k. thing. you're in a tube of death and you're getting -- you're downloading different things and you're mad if it's not fast enough. >> that's right. >> but that said, it doesn't really matter because that's what people expect. so when you're looking outwards we just have a few more minutes, when you're looking outwards at

the industry, what is a cable -- is there a cable industry? should it be called the -- i know you put the x on the end and that's a nice looking letter. >> xs are good. >> it feels modern. >> we didn't capitalize anything. >> i see that. look at that. >> that's hip. >> we use a slash. it bothers people a great deal. punctuation is everything. what do you imagine? should it be called the cable industry anymore? because cable denotes -- it's sort of like saying we're having a motorized horse kind of thing. how do you -- >> motorized horse. there you go. driverless car. >> you're going to be watching. see, now, that's an opportunity for you. driverless car. you can text drink, and watch television. >> i was in las vegas at the ces show. they were bringing driverless cars in and i was turning on the local news and the only thing they were talking about was

whether open carry laws could be eliminated in a driverless car. >> leave it to vegas to be way ahead of things. >> i think it's a great question. i do think -- i hate the name. i do think it has a proud history but it needs to be retired in some way because i think your past can be part of your glory but it also can be a weight around your ankle when you're looking at a tumultuous future with new challenges. and i think that it also doesn't fairly capture what they do. you know this industry has successfully deployed the most sophisticated infrastructure in the history of the world in the fast nest amount of time of any technology in the history of the world and increases the that at exponential rates. it should be more centered around its future as it's associated with the internet and less in the minds of consumers just with the great disruptions it made when it revolutionized broadcast tv. and i think that's a cultural change. it matters what you call yourself. it matters what you look like.

it matters that i voted not to wear any tie this afternoon. >> i see that. it's a big move by you. >> it's a huge move for me. >> wow. >> larry page is quaking back in silicon valley. >> he is. >> he's not wearing shirts anymore. >> that's why i smelled the chair, to make sure. >> that was mark zumckerberg. my last question, because we have to wrap up. what do you think is the thing you'd like to see? is it vr? completely surround entertainment? give me a michael powell prediction of something -- >> the most eye-popping -- >> the most eye-popping. >> i think it's going to be holographic. i literally think there's going to be a day where "game of thrones" almost plays out in three dimensions in your room. >> and do you have to be dismembered as part of that experience? >> absolutely. what's "game of thrones" without a beheading or blood? >> or worse really on that show.

>> that will be more dangerous when you get to play in it with them. but i hope that's after me. >> michael, thank you so much. >> thank you all for coming. ♪ >> ladies and gentlemen please welcome the chairman and ceo of comcast corporation, brian roberts. >> it's great to be back. and hearing michael just talk about how not to wear a tie and we're at intx. oh, well, here we are. you are who you are. so timing is perfect. we had earnings yesterday at comcast. we had a terrific quarter. i want to thank our team.

we've got a lot of momentum. let me just address my friends at time warner cable and say thank you very much, you're completely gracious. same with charter, greatland. but we're moving on. so being here today allows us to show you what we've been cooking up in the labs. and i'm really excited to show you a few things and then invite you to come to the floor of the convention and see live firsthand a fabulous booth. so the cloud has really changed everything, and it allows us to keep innovateing at a pace that's really unprecedented for our industry. we won't call ourselves the cable industry anymore. so you know, here is the x-1 operating system. you've seen this before. it's clean. it's simple. it's elegant. you have the save features. all sorts of new enhancements there i'm not going to do today. on demand continues to grow and get better and better, and usage is incredible.

we have now had 38 billion orders since we really launched on demand. search is what i want to show you a little bit today. that's the key to everything as the content quantity keeps increasing. we're up to something like 2.4 million searches every day using x-1. and then we have apps. the xfinity apps section. and we keep expanding that. and that will be a big part of our future as well. so today i'm excited to say that we're officially finally launching the voice control remote. and let me explain what that means. it takes search to a whole new level. there's no extra charge to any x-1 customer to have a voice remote. we purchased 5 to 6 million devices for this year alone. and if you're a customer in the room at the convention, just come by our booth and we'll get you a voice remote and you can take it home and play with it

yourself and we'll send it to you. there's more than 3 million commands possible. it's just the beginning. and we've shown you before changing channels and searching by name. but we're now taking voice to a whole new level. so today you can tune to any movie, but what if you can't remember the name of the movie? so you could just say life is like a box of chocolates. and it will figure that out and automatically tune -- >> my mama always said life was like a box of chocolates. >> now, tom hanks looks a lot younger then. so you could say how old is tom hanks? and we built search functionality right into the remote. we call this x-1 answers. and people are using their smartphone to do things like this. we just thought we should put it all right into the remote control. the next thing you were working on is find the "forrest gump"

running scene. so this would obviously involve working with content companies. it could take you right to the section of the movie or the show or the sporting event you want to do. great song. you're watching. what is this song? ♪ 65 i was 17 ♪ ♪ i don't know where i'm run ♪ >> "running on empty." so the product continues to come up with new ways to allow you to enjoy one show searching, getting answers. and our folks in the labs have been really amazing. so show me the comcast time warner cable merger. >> get down!

[ applause ] >> that pretty much sums it up. so we really are moving on. so let me switch gears. let's show you something completely different available for parents and their children. if you say go to kids' mode, the automatically using your voice control, you're now in a zone that's completely safe for any children under 12 years old. then if you puck a show, here, i'll pick "icarly," we have a wonderful partnership with common sense media. we've shown that you can go in, have all the specifics of that show, see what age is truly appropriate, and here we are. now, from here i could say create an "icarly" playlist. and this is a new feature we've been working on. it shows you can just then set

for your children a whole series of shows that's their favorite and then you could say, okay, pick a different episode, let it play and the "icarly" episode begins to play. now, if you leave and your kids want to switch out a safe zone kids zone, you're going to need a password. so all really easy for customers, all within their control, and all using voice. now, you're happy with that, you now want to go back and say let's watch a movie, we'll pull up "jurassic park," and i want to continue watching and the movie begins and you get a notification that says someone's at the door. you click this is xfinity home. the camera comes right up. you can activate the door lock, and someone can come in. so we think that's really cool and we've now been saying, okay where do we take xfinity home as we've integrated it and begin to have more features there.

so today i'm pleased that we're announcing taking the platform to a whole new level and working with third parties because the system's open to try to help integrate it, make it easier for consumer, using voice or using your mobile app. so we've got a partnership we're announcing with lutron where all of the lutron lighting and home controls will be available on your xfinity app. the same with nest where your thermostat, which they've revolutionized that, and also with other devices, august lock who is doing the unthinkable and making locks cool. and so all of those partners are now -- you can use one app and it all will control any device including our devices or the third-party devices. now, we're also focused on customer experience. we've talked about x-1. we've talked about xfinity home. and what neil has been saying

and i think a number of us, we want to make the customer experience our number one priority and our best product pf we've taken a lot of the innovation and we're now putting it over here. let me show you some things we're announcing at the show and we're going to be doing a press event later this afternoon. the goal is to make it incredibly easy for customers to do business with us easier than ever before. so it starts right here with my account app. we've now added a feature called tech tracker that will let you know in real time that james is 15 minutes away, you know who is coming, you're comfortable, when you're done the job is complete we then can let you rate whether you were pleased with the service. if we don't get enough stars we know something wasn't right. rather than wait for something to go wrong and you have to call us we'd automatically call the customer. and we started this in boston. we completed a trial.

it was a huge success. we want to have this tech tracker across the entire footprint by the end of this year. another feature we call callback. now, 42% of our customers manage their accounts either online or via a mobile phone. so we want to make it easier for you to do that. and your time is valuable. that's the number one thing we hear from customers. so instead of you calling us we'll call you, you schedule an appointment in 15-minute increments, we now confirm that that's what's going to happen and your call is scheduled. we have that rolled out now. one last thing that you can't come to the show and for me to do a bit of a quick demo and not talk about broadband speed. so i want to preview our new future home gateway but let me take a quick look back at what the first generation, which may

be in people's houses still here is the second generation includes voice and broadband and that's our current modem. so we've hired a bunch of fabulous designers in house, working with third parties designing our own suite of future products. and let me show you what they're going to look like. they're really sleek and sexy. there's our team clapping. please come to the booth. you'll be the first ones to see it. this is something we developed in philadelphia and in silicon valley. they're capable of delivering nine gig abits of speed in wi-fi, 50% lower cost per megabit then today's routers, and what's cool is it's not only a next generation gateway but it combines incredible speed, but we're going to have i.p. video capability, phone, wi-fi and all the xfinity home control all in that device. and then so that you have

perfect reception throughout your house there's mini me over there, which is in the same suite, and all of this is trialing this year will be across and available across the footprint by the end of 2016. so as you can see we've got a lot of exciting things going on and we've sort of been working on customers and seeing and touching and feel it. so here in chicago we've piloted, it's taken a couple years, something we're calling studio xfinity. we're doing a press event this afternoon. let me just show you a quick image. totally different look. all the products that we've talked about. we have hundreds of stores all over the country. we've been upgrading them. and we're trialing this new concept to see if customers can come and play and have events and experience the incredible breadth of products. so that's just a glimpse of what we're working on. welcome to you play with all of that at the booth. thank you very much. [ applause ]

>> and now ladies and gentlemen, joining brian roberts for our next conversation, please welcome the host, the chairman and ceo of media link, michael kassan. and also, please welcome the chairman and ceo of the chernin group, peter chernin. >> good afternoon ladies and gentlemen. >> where do we sit? >> or good morning. in considering how to frame today's discussion, i recalled a classic movie scene. colonel t.e. lawrence takes the tip of a burning match between his thumb and his forefinger and slowly grinds them into a flame until the fire goes out. doesn't it hurt asks the young soldier watching. the trick says the man who will become known as lawrence of arabia, is not minding that it hurts.

is there a better metaphor for being in the moving video business today? with consumer video behavior hurtling all over the place, viewing platforms proliferating like mad, and technology making a hash of everything we know about the business you've got to be able to take a lot of punishment and as well give some back. today we are fortunate to have two of the most accomplished executives in the industry to tell us how to take a licking or give one. as the former president and c.o.o. of news corp., now fox peter chernin was one of the most powerful media executives on the planet. now he's involved in everything from the "planet of the apes" to india and china and is one of the most respected entrepreneurs in the over-the-top television world as well as other innovative ventures. brian roberts as you know works in a small family business. it's a pretty good business. and just after watching brian earlier, i realized i can't call him the cable guy anymore. i'm going to call him the pitch

man. that was great. and clearly while we always talked about the last mile brian, when i saw what xfinity does in the house it's like the last inch. it's a new world. ladies and gentlemen i promise not to be painful but extremely educational as we get a chance to chat with peter and brian. so thank you. brian, the video you that showed with the explosion i think you already addressed the elephant in the room. so i don't think i need to touch on that. but what i would love to do is kind of switch gears. yesterday was a good day for comcast. the earnings announcement is a good example and a good sort of picture as to how the marketplace is changing, the subscriber versus the broadband. obviously, you talked about it yesterday. but i'd love to just chat about it a little and how you see that

portending for the future. >> well we have a fabulous company. my father's 95. we have been fortunate enough to be on a wonderful journey that seems to take many twists and turns, but i pinch myself every day to work with a team of people, and now the nbc and universal folks. so yesterday all parts of the company seemed to be firing on all cylinders. we're rolling out more x-1. that we stated we're going to increase the pace of that. we're getting great customer response. the broadband we said for the first time we've crisscrossed that there's actually a few more broadband customers and growing fast. video has kind of leveled off. so we've invested in the best network, the fastest in-home wi-fi. we kind of redefined what we think broadband is. and it has to be that whole last inch experience.

and then many many other things in the cable division. but they never -- the team never lost its focus, and for that i'm grateful and proud. over at nbc universal, and peter helped us have peter help ed us have the confidence to jump at a perfect time to buy the company. the job that steve and the team have done is in my opinion one of the best experiences i've been part of in 30 plus years. we reported yesterday that the four big divisions, the one that everyone here is is familiar with, the cable networks, continue to be you know the most cash flow part to have company and we've got lots of nice story, lots of challenges i'm sure we'll talk about but it's incredible brand. usa, cnbc, bravo, on and on. broadcast everybody's familiar with nbc. we had a big day with kentucky

derby and p super bowl and olympics and blacklist and the voice and next week, we launched a new up front season we're the new network from 18-49 for the sexd year in a second year in a row. but the one just to quickly, the two that just shocked us were the movie business, which peter's completely familiar with. we have fast seven fifthy shades of gray, minions, this will be the biggest year in universal's history and our old friend jeff shell is isrun ingning the studio and then theme pashlgs was the fastest part of comcast in all those businesses, which we kind of sat and said do we want to even make the investments necessary in theme parks back then and over 50% growth and cash flow in first quarter thanks to harry potter and the new mininos attraction and hotel

hotels and other things. just a great time in the company and you know we obviously can't look back, can only look forward and with that kind of play of activities, it's an amazing time and it was yesterday. >> the only postscript i put on that, the it's a positive one, brian, before i turn over to peter, was having worked with you guys back when you were at nbc as well. the commitment you made back then to make the investments in programming and technology ge was a wonderful company, but they weren't making these investments. as we know, the results are great and congratulationses on that. >> and peter, you made that great comment. if you don't fall in love with nbc, don't do this particular deal. we've made investments film cable, technology to advertising, sports rights and the list goes on. >> it's paid off. >> it's paid off. >> peter, let aes talk about that which it seems brian, i'll

speak for myself, does better than i do. his skinny bundle looks pretty good. i need some work on mine. what does all that mean at the end of the day? you've sat on all sides o f this and again, some of the stuff we've had the privilege ledge of working on and the things you're leading in the sort of the ott world. you were a content creator, you ran studios. it's an interesting time. >> if i knew that, i'd probably be sitting some place more fun than right here. >> come on this is fun. >> i think it's a very complex question. i think what you're see inging is tremendous distribution explosion. i don't necessarily think that you know, i'm not convinced you're going to see the claches of the bundle. i think that's wildly overstated. i think you'll see the bundle

probably rationalize in some ways. i think you're going to see the tremendous explosion of new alternatives largely ip delivered. i think you're already seeing. netflix, youtube, the amount of viewing on youtube, if you're trying to reach younger demos, it's just an explosion of younger demos. i think you have all these other alternatives and what it will ultimately do is force in some ways, force the bundle to justify itself and that's honestly not the worst thing in the world. >> so, peter when you mention youtube, it's interesting. having been there at the beginning and you've made real investments in some of the sort of youtube directed full screen and things of that sort. these days i don't sit with a content creator in the multichannel network world where

so much noise is happening and it's good noise, where they don't talk about their strategy. it's now part of the checklist. you have a youtube strategy, but now, you need an off youtube strategy. how do you think that plays out? >> i think what you're seeing, which is a great opportunity in the over the top content space. avon, it has largely been a youtube business for the last five years. where almost all advertising supported video has been viewed and what you're seeing now is enormous competition largely within the last six to 12 months, but an enormous amount of video viewing on facebook. you're seeing twitter with video. i think some of the snap chat experiments have been fascinating.

aol. what you're seeing for the first time is enormous competition, which historically has been great for content creators. what you saw, look, one of the reasons why the cable channel business is so profitable today is that you have real distribution competition. cable, satellite, the tell cos coming in and generally, those had a lot of leverage. and distribution competition leads to leverage on the part of content creators and i think for the first time, you're seeing that and it's why everyone's talking about the strategy. personally, look, youtube is a great distribution partner and deserves a will the of credit for building that business. if you're a content creator the more competition the better. absolutely. >> you talk about the snap chats and the kind of the next gen. i read something in wake of the fight this weekend. about the amount of people who

watched on perriscope and mere cat. different kinds of viewing experiences, yet the numbers were extraordinary in terms of wh the pay per view revenue was. >> brian and i were talking at this earlier. i'm on the board, so there was certainly no intentional on the part of the perriscope device to serve as a piracy device. i think the service has been live for about a month. they were moving as quickly as they can to respond take down notices and things as quickly as i think that the future of those devices is not to pirate other media and i don't think that's anybody's intention, but i think some of the other things that they did in the dressing room, behind the scenes stuff, sort of the ability to live broadcast, which otherwise wouldn't be part of a broadcast because you're on a linear feed, i think it's a great opportunity and i think it's just again, part of this

explosion of viewing opportunities. >> for all of the media attention, piracy and still represents the vast minority of how those people consume the fight was awful. in terms of high-end of everybody's estimate. so as we build a legal home theatre, there's always going to be an illegal one. responsible companies are always trying to tamp it down and there's always people trying to figure out. obviously, the world of technology makes it constantly blurring the lines of how do you control that which in the old days you could control and it will always be a cat and mouse game. i will say this about new forms of distribution, new forms of i don't love the phrase over the top but just simply because i think this is a combined experience world. t not either/or. it's not really going over anything.

it's right through our broad band and if if we do a great job of building a wonderful broad band, that's what this room is doing and what's enabling this. we thought for a long time, video from the net, now ip, is a great thing for our businesses if change is uncomfortable, but net net is powering our growth, so in terms of all these different services, if you take them all, i think the value point, peter that you made, so far is demonstrating what a great deal it is to get the bundle and it's not even close, so if you add up all the individual pieces, you can't come close. we need to tell this story be responsive to the market. not everybody wants everything we know that. and i think it's a work in progress. >> to a savvy audience like this, this is not news. how many people binge on blacklist? i do for sure and i love every

moment of it but i haven't watched one episode on nbc. i've watched on a device other than that thing on my wall and i'm asking it from a different perspective. my focus is usually on the advertising side. in terms of video, there's no question. the numbers are up. in terms of advertising as we look at it, which you know, is certainly an important part of comcast nbc universal's business today way more than it was four years ago. >> so, the good news is advertising for our company continues to be really strong. the scatter market into the upfront has been really hot. but there's no question that the kind of behavior and viewing you're talking about is happening all over and as peter said, it's great that people want to see your content. how do you catch up and monotize is no different than the perriscope conversation.