DETROIT, MI – Joint press conference of Secretary of Energy Spencer Abraham and Canadian Natural Resources Minister, Herb Dhaliwal. 

SECRETARY ABRAHAM:   Good afternoon.  I want to thank everybody for coming here today.  I am very honored to host my friend, Minister Dhaliwal, the Energy Minister, really the Natural Resources Minister of Canada for the first meeting of the U.S.-Canada Joint Task force, investigating the 2003 power outage.

    Both Minister Dhaliwal and I recognize the magnitude of the problem which has taken place.  And I know, speaking for our side, that we have great compassion for the people of the U.S. and Canada who were affected by the power outage, whether it was folks who were directly affected or those whose families were touched by these incidents, and so we are deeply dedicated to the responsibilities we've been given to move forward aggressively and in a timely fashion to both identify what happened and how we can make sure it doesn't again.

    I know the past several days have been extremely busy for Minister Dhaliwal, and I want to thank him for being here in Detroit today.  And I also want to thank the dedicated employees of all of the state, local and provincial governments, and the utility workers who have been putting in long hours this past week to bring the electricity back on line to deal with the emergency conditions which were precipitated by the blackout.  All had a tough job, and they did it well.

    To the millions of people in the United States and Canada who endured the blackout, as I said, we offer a special thank you.  Our nations marveled at the way you confronted the inconveniences and often the personal dangers caused by this power outage.  The spirit of cooperation and community that was demonstrated is an inspiration to all of us.

    Today, Minister Dhaliwal and I had a very productive meeting.  We were issuing a joint communique that describes the scope of the mission ahead of us, which is to determine what caused the outage, why it spread, and what we need to do to prevent similar outages from occurring again.  Today's meeting marks the formal beginning of our investigation.  Much work is already underway to gather data and interview people at utilities, independent systems operators and other organizations to ensure that we get a complete and accurate picture of exactly what happened.

    I'm pleased to be working again with Minister Dhaliwal on another important assignment.  We are both firmly committed to producing an independent and effective review that will result in more reliable electric service for millions of people in both our countries, and we share a commitment to getting this investigation done as quickly as possible and as comprehensively as is called for.

    It's now my pleasure to invite Minister Dhaliwal to make comments about his perspective on the work ahead, and after that, we'll be pleased to take questions.

    MINISTER DHALIWAL:   Well, thank you very much, Secretary Abraham.  It's a real pleasure for me to be in Detroit again.  Detroit was a great host last time I was here at the G-8 Energy Ministers meeting, and it's great to be here today as well.

    I also would like to thank all of the people that worked so hard during the blackout period.  We have seen how communities come together, individuals have come together, both in your country, in the U.S., as well as in Canada, to deal with this difficult situation.

    And it shows, first of all, as two countries, how interdependent we are, how we have a very integrated electrical system, but it also shows, as a society, we have become more and more dependent on having reliable, consistent and quality of power as we move to an information economy.  And we realize how things come to a stop when we don't have reliable power, whether it's people who spent 30 hours in airports trying to get a flight, people who were in subways, people who were trying to use their phones, and we understand the tremendous frustration that this has caused for our citizens on both sides of the border.

    I can say it's a great pleasure for me to be also seeing Secretary Abraham, and we've had the opportunity to work together on a variety of projects, including when he was Senator for Michigan, and I know he has a tremendous amount of knowledge about border issues and Canada as well.  So I think that it's a real honor and a pleasure for me to be working with him again on such an important issue for both our two countries.

    It's also a great honor that our leaders, President Bush and Prime Minister Chretien, have announced this joint task force and asked us both to co-chair this task force, which is very important.  It's very important to come together and find out what were the causes that caused such a situation.

    All electrical systems are built to ensure that, when we do have problems, they can be contained and isolated.  And in this case, from the initial evidence, it shows that there's a dominoes or cascading effect.  And as someone who has worked in this area, it's rather surprising that it was not contained, and we need to get to the bottom as to what were the reasons.

    Today, Secretary Abraham and I had a very constructive discussion, a discussion regarding what has happened to date, and we've had a very good discussion how we can cooperate and work together, as this blackout affects both our countries and use the resources that we have together to deal with the first challenge, which is to find out what was the exact cause.

    We want to make sure that we do a comprehensive and thorough job of this, and we want to make sure that we have a clear understanding of what happened.  And you can understand that's not easy because there is lots of data that has to be looked at, that has to be analyzed and reviewed.

    I have appointed the Deputy Prime Minister, John Manley, to be on this task force as well, along with Mr. Kenneth Vollman, Chairman of the National Energy Board, and Ms. Linda Keen, Chairman and Chief Executive Officer of the Canadian Nuclear Safety Commission, to join me in the task force.

    We will be seeking the cooperation and input of provinces, territories, states, energy providers and regulators, as well as technical experts and engineers in the work of the task force.  Reliability of the system is paramount.  Understanding the complex chain of events that led to the recent power outage is a challenging task which will take time, and we are committed to working to make sure that we have some of those answers as quickly as possible.

    In fact, work has already started, and we'll be working together to make sure that we have some answers for both Canadians and Americans as to why this blackout happened, and then moving on to provide recommendations to both the President and the Prime Minister as to what we need to do, as two countries, to make sure that this situation does not occur in the future.

    So that's our two major objectives, and I look forward to working with Secretary Abraham and make sure that we move as quickly as possible.

    And, in fact, when you look at it, Secretary Abraham and I had a discussion--I believe it was Friday--

SECRETARY ABRAHAM:  Right.

    MINISTER DHALIWAL:   It was within 24 hours after the event, and in less than an week, our officials have come together to arrange this meeting, have an outline of what we're doing.  So I think it shows the urgency of the situation, and of course the direction from the President and the Prime Minister is to move as quickly as possible because this is very important for both our countries, and we want to do everything possible to make sure that we know what the causes are and make recommendations to make sure we don't have this problem in the future.

So thank you very much.

    SECRETARY ABRAHAM:  What we're going to do is take questions and kind of take turns calling on people.  So I get the first call, if somebody wants to ask a question.

Roger?

    QUESTION:  Mr. Secretary, why is the reliability, something this crucial, really left in the hands of the private sector and what can be done?

    SECRETARY ABRAHAM:  Our concern, from really day one in our administration, has been to make the reliability standards, the standards of behavior ones that were mandatory and enforceable at the federal level.  That's why we have been pushing for energy legislation because we believe that these standards have to be enforceable.  There has to be punishment meted out if people fail to meet them.

    We don't know yet what was the cause of these problems, but we do know that having enforceable, mandatory reliability standards that are governed at the federal level has to happen.  It's contained in both energy bills that were passed by Congress this year.  Now, they're in Conference Committee, and I've spoken this week to both Senator Domenici and Congressman Tauzin, and I know they're going to get to work immediately to try to finish the job, and we need an energy bill now more than ever.

MINISTER DHALIWAL:  Colin from Canadian Press?

QUESTION:

    MINISTER DHALIWAL:   Well, first of all, I had the opportunity to talk to Premier Ernie Eves yesterday, and I've also had an opportunity to talk to his Minister of Energy, John Baird.  I will be meeting with the Premier to brief him about our discussions.  There is an opportunity for them to participate.

    The way we've structured the task force is that we'll have three working groups and, within those working groups, there will be an opportunity for the Province of Ontario to participate to provide their input.  And I'll be talking to Mr. Ernie Eves today and just make him aware of the discussion that we've had.  But we think they have an important role to play, and they will be more at the working groups level.

SECRETARY ABRAHAM:  John?

    QUESTION:  Secretary Abraham, I know you said you weren't part of the initial finger-pointing yourself, but there's .  How determined are you, how confident are you that ?

    SECRETARY ABRAHAM:  We're here today, and just as Minister Dhaliwal said, just a matter of six days since the incident.  We were on the phone to each other the day after the incident started.  We have worked together, as you know, on a number of projects, both between our ministries, more recently, and before that when we were collaborators at the time when I was in the U.S. Senate.

    And so I'm highly confident, first and foremost, that the Minister and I can work well together, and our team has already proven that.  We've formed a North American Energy Working Group and have a strong bilateral energy working relationship.

    The President and the Prime Minister have been very clear to each of us that they expect us to make this task force effective, to work together and collaborate in all aspects, and I'm extraordinarily confident that that will be exactly what takes place.

    MINISTER DHALIWAL:  Could I just reiterate what Secretary Abraham said.  We're very confident that we'll work together, and we've been working together for many, many years on a variety of issues, so I think the fact that we've been involved together is important, and we've worked extremely well.

    But I think for the citizens of both our countries, both the U.S. and Canada, it's very important, it's essential that we work together on this issue because I don't think we want our citizens to go through what they did at the last blackout.  So I think, for the sake of our two countries and our citizens, we want to make sure that we work in close collaboration and cooperate as much as we can because they want to--

    SECRETARY ABRAHAM:  Just one other point.  You know, I gave a speech I think my first year as Energy Secretary, in which I talked about the degree to which there is this interrelationship not just on energy, but obviously on a lot of other issues, and one of the things that I hope people took away from last week's experience is the significant degree to which our countries have a relationship.

    It's not just a relationship based on friendship, it's a relationship based on this interconnectivity on so many fronts.  Of course, if you live here in Detroit, which is my home area, you know it very well because the border is right here, and we do a lot of things back and forth across the border, including an enormous amount of trade.  And maybe last week helped to emphasize the extent to which we have this interrelationship.

MINISTER DHALIWAL:   Kathy from CTV.

QUESTION:   

    MINISTER DHALIWAL:   Well, first of all, we have a very integrated electrical system, which is advantageous to both our countries, both to Canada and both the U.S., for reliability and for an economic basis.

    Let me give you a good example of why it's advantageous to us.  In British Columbia, when California has got all of their air conditioners on, and they have peak needs, British Columbia sells power into the Pacific Northwest.  In the winter months, when we have peak needs, we buy back the power.  So, in terms of economics and reliability, our systems have worked extremely well.  They're efficient, they're effective, and actually it creates a more competitive economy for both of us because we're, you know, trading as global nations.

    In terms of, I mean, we've been working with Secretary Abraham and his officials on the bill, in terms of putting Canadian interests, as to the areas we think that are important for Canada, and I must say we've had tremendous cooperation from the Secretary and his staff on issues of having standards which are equivalent across our countries--reliability standards because that's very important.  In terms of having input by Canadians, in fact, the head of the Reliability Council, the North America Reliability Council is a Canadian.  So we have a lot of cooperation that we're working together.

    And I think that this will strengthen that cooperation because we realize that we need to work together.  And if there's any weak links that exist because the chain is as strong as its weakest link, we need to work together on them to fixing those so that we don't have this type of blackout problem.

    QUESTION:  Mr. Secretary, in the past, you've been very clear that there is no evidence that this was intentional.  Can you rule it out at this point?

    SECRETARY ABRAHAM:  All I can say is that we have no evidence whatsoever, nor have any of the agencies or state or local government units who have been looking into things found any evidence that any kind of intentional action was involved here that started this blackout, nor certainly any evidence of sinister involvement by anyone.

    We will, as far as I'm concerned, continue certainly to find out all of the facts that we can.  That's the purpose of this investigation, but I'm very confident that the reports we've received so far are accurate, and we'll find out where the trail leads us now, in looking at the other issues that we're analyzing, a very significant amount of records and other pieces of information as we pull this puzzle together.

MINISTER DHALIWAL:   Adel from AM 800.

QUESTION:   

    MINISTER DHALIWAL:   Well, we've seen that there's a huge impact when we don't have reliable power.  It affects our borders, it affects businesses, it affects businesses between our countries.  The fact that our car manufacturers are not working the full three shifts affects American businesses as well because these days on-time parts delivery is a very small window, usually two to four hours, where parts have to be delivered.

    So it has a huge economic impact when we have this type of situation.  Safety, of course, we've seen safety can be a very serious problem and a tremendous inconvenience.  So there are some people who will number crunch and tell you what the loss to the economy will be.  It's obviously in the billions of dollars when you have such a major disruption, where tens of millions of people's lives were affected by it.

    That's why we're responding so quickly, both governments, Canada and the U.S., because we realize there's a huge impact, and if there are problems in the system, we need to correct them as soon as possible, and that's what we're trying to find out.  So, yes, I don't have the exact figure, but there will be billions of dollars that affect our economy.

QUESTION:   

    SECRETARY ABRAHAM:  Sure.  Well, basically, we look at this in two phases.  The first phase is trying to acquire information and to investigate really what happened.  It's a fact-finding, an analysis phase.  And one of the groups will be working on the broad issue of what happened and why did it cascade.  We're going to look at it a little more specifically in the context of its implications and impact both from a security point of view and then also from the point of view of the nuclear power sector, and so those will be the three groups; the sort of overall analysis, and then the specific examination of the security issues, as well as the nuclear power industry.

    One of the things we hope is that we can learn from what happened, not just in the making of recommendations to prevent it from happening again, but also in identifying the kinds of challenges we might have in the future in other respects, whether it's this kind of broad experience or just, in general, making sure the infrastructure is as effective as possible.

QUESTION:   

    SECRETARY ABRAHAM:  Well, a major issue, of course, a major part of the power

component in the generation of electricity in this region, in this area that was affected, was the nuclear energy sector.   And we want to look closely at how that system worked and responded against the backdrop of this outage.

    These are safety issues that the Nuclear Regulatory Commission, on our side, has the lead responsibility for.  As far as I was able to tell, during the period of the outage, the safety components, the safeguards in the system worked very well, but we do want to make sure we analyze that closely and determine whatever we might about how to even improve it more.

MINISTER DHALIWAL:   Derrick, from CBC.

    QUESTION:  Minister and Secretary, both, you said one of the goals of the task force would be to try and prevent further blackouts in the future, but we've been hearing from experts in the power industry   somewhat updated   investment.

    How could you guarantee to the public in both countries that a power outage like this will not happen again?

    MINISTER DHALIWAL:   Well, that's our objective.  Of course, you know, no one can ever guarantee these things.  We've had power outages on occasion before, going back to 1965, when we had the great blackout as well.  But what we want to do, first of all, is in order to understand what things we need to do to prevent this, we need to have an exact cause of what caused the situation.  And there's all sorts of theories out there in terms of there's more stress on our grid system.  Is there sufficient resource reserve generation?   It could be technical?  Some things it's a human error.  So we need to get to the bottom of exactly what the cause is, and then we can do a better job in terms of determining what things we need to do in our countries in terms of whether it's new investment, whether it's, as the Secretary is attempting to do in his energy bill, to get mandatory reliability standards or do the standards need to be higher?  Are there other things we need to do?

    Those are some very good questions that we'll need to answer, and some of them may require investment, some of them may require different training.  We don't know that, and it would be speculative for me to say we'd be doing one thing or the other, and we want to make sure we do things step-by-step.

    And the first step is to find out the exact cause, and then the next step will be look at what sort of recommendations will we be providing to the President and the Prime Minister as to what we need to do as both countries to make sure that we do everything possible to prevent such a thing happening again.

     SECRETARY ABRAHAM:  I think Minister Dhaliwal has outlined our plan very succinctly.  So our goal is to figure out what happened last week and what needs to be done to prevent that from occurring in the future.

    That's probably a totally separate issue from how we respectively meet the growth in electricity demand that we project over the next decade and beyond.  And we know there's going to be continuing expansion in the use of electricity in our countries.  We know that the demands on the transmission grid will continue to rise, and that's a broader issue I think that is being, in part, debated in our energy bill.  It's been something that we've focused on in our department with the National Grid Study which we conducted last year, released last year.

    And so that issue will remain in I think discussion, irrespective of the findings that we have here because, and it will be an ongoing discussion because this growth is forecast to continue for a long period.

Is it my turn to call on one?  I can't remember.

QUESTION:   

    SECRETARY ABRAHAM:  You know, an earlier comment or question that involved the issue of finger-pointing that took place early on, and I think it's our view that we want to gather the facts, and we want to determine what happened.  And to speculate or to comment on issues or rumors or whatever they might be, before we have the facts, before we fully have analyzed the data, would be unfair.

    And I think that the goal of our task force and the experts we've already enlisted in the effort is to do this professionally and to do this in a very analytic way and only to get to the conclusions after we've sifted through all of the data.  So I certainly don't plan to speculate at all about any particular company or accusation or any of these things.

    Our decision not to engage in that speculation should not be misinterpreted either.  We're going to engage in an orderly process that's fair to all concerned and move as quickly as we can.

MINISTER DHALIWAL:   Troy from Global TV.

    QUESTION:  For both the Secretary and the Minister, I guess the air conditioning and the lights have brightened up   today, and   that Canada and the United States   the biggest energy plan.  So what is the talk we're hearing as far as increasing capacity, increasing loads on the grid, --why, as opposed to ?

    MINISTER DHALIWAL:   Well, first of all, you probably followed we just announced a billion dollars last week in Canada to conserve energy and to work with consumers, incentives to, for example, increase the efficiencies in their home, promote vehicles with alternative fuels.  So we have invested a lot in trying to promote alternative energy, as well as efficiency, work with companies as well.

    So, on the demand side, I think we're working very hard to reduce the use, and we recognize that there's a lot that can be done in this area.  In my own house, I had it audited to see how energy efficient it was, and I have a few things I have to do in my own house to make it more energy efficient.  And this is part of the program which we've already put out.  So I don't think in any way we're neglecting that.  What we're saying is, yes, there's going to be an increase in demand, and we have to make sure that we deal with that.

   Right now we're saying that we want to make sure that we don't have these type of major outages that existed.  It's a huge cost to both our governments, and we're focused on that, but I think that does not take away from all of the things that the Secretary is doing, and I'm doing, in terms of conservation, and alternative forms, and diversification of energy.  Those things continue, but in this case, we've had a major situation that we need to make sure that we do everything we can to make sure it's not repeated.

    SECRETARY ABRAHAM:  You're probably looking at two of the greatest, if not the two greatest, advocates of technology, and research and development in energy efficiency and new energy sources I think on the planet.  We work together on these things.  We've met and discussed them on many occasions, and I think both our governments are deeply committed to those investments.

    Just to give it a perspective, in the United States, we would, in the absence of more efficiency over the next 20 years, we would probably have about a 65- to 70-percent increase in the demand for energy.  Because of what we hope to be the gains that we'll make in conservation, energy efficiency, and structural changes in the way people do things, we hope to offset two-thirds of that projected increase, but that won't offset all of it, and the remainder will have to be undertaken by more production, more energy or else we won't have a growing economy.

    And so much as we hoped to achieve with efficiency, there's still going to be growth in the populations, growth in the energy demand as we grow our economies.  The key is to try to make our economies more energy, to address the energy intensity of those economies and to improve the efficiency.

    Our department this year has submitted a budget to Congress, the President submitted a budget that was the highest budget, higher than any of the last 20 years in terms of the appropriations for energy efficiency and renewable energy programs.  And our FreedomCAR and hydrogen program is an example of the kinds of new technology we're working on.  We believe that this is a key ingredient.

    In fact, just earlier this summer, in July, we announced at the Department a program we called the Smart Energy Campaign because we recognize that going into this coming winter, unless we are more efficient in the way we use energy, we could have some real challenges meeting the natural gas demands of the cold winter months, and so it's something we work in our department and are committed to, but at the same time we have a huge demand level to offset.

    And so we've got to balance the equation with conservation, on the one hand, and energy efficiency, and on the other hand with more production and infrastructure to support it.

    In all fairness, our grid study, which I referred to a few minutes ago, suggested that because of the age of the grid, even in today's circumstance, even before you project forward this increase in demand, we have a lot of congestion.  That congestion costs the people of our countries money because it makes for a less-efficient operating system, which translates into higher energy bills.  So we've got to address these things in a thoughtful way, and we keep trying to do that.

MINISTER DHALIWAL:   KS?

    QUESTION:      I was wondering, there's been a lot of fingers pointing at the State of Ohio, and the state officials would like   Ontario   to have someone to participate in the investigation, rather than just be the subject of it.  Will you make a spot available somehow for the Ohio State Commissioner?

    MINISTER DHALIWAL:   Well, first of all, from Canada's perspective, and I think that Secretary Abraham could probably talk directly on that, but as I've said, we have the Province of Ontario, who is interested in participating, and one of the areas it can is the three working groups that we'll have; the Nuclear Working Group, the Security Working Group, and the Electrical Working Group.

    This is an area that they can participate, and I will be meeting with the Provincial Premier to discuss that with them because we think it's important.  We need to have their perspective as well.  So we will accommodate, from Canada's perspective, to get involvement.

Secretary Abraham could better respond to that for Ohio.

    SECRETARY ABRAHAM:  Yes.  The answer is, yes, and Minister Dhaliwal outlined how we envision this.

    We want the affected states to have a role in the working group efforts, and so we'll be, probably in just the next few days, we'll be announcing the participation in those working groups, and we expect to see each of the states who were affected represented on the working group level.

MINISTER DHALIWAL:   Thank you very much.

SECRETARY ABRAHAM:  Thank you.