Remarks by Ambassador John E. Herbst
at Energy Efficiency Seminar

Kyiv, Ukraine
February 28, 2006

Distinguished panel, ladies and gentleman. It is my pleasure today to welcome you to our seminar.

All of us in this room know that energy is a hot issue.

Just last week President Bush delivered three speeches on this very topic. He called for the United States to develop alternate energy sources and promote greater energy efficiency.

Here in Ukraine, President Yushchenko in a February 11 radio address announced the creation of a new national energy saving's agency and said, "the formation of a new energy efficiency program is a task of a national scale." Through this new plan President Yushchenko called for Ukraine to cut energy consumption by half, diversify energy sources, and better utilize domestic energy resources.

I know that many of you in this room are tasked to make President Yushchenko's goal a reality. I hope the presentations and discussion today will help you in this.

Before we listen to our experts, I would like to mention a few programs active in the United States to enhance energy efficiency:

Private businesses and universities in the United States receive grants and tax incentives to invest in research and development of new energy technologies. These programs have stimulated the development of hybrid vehicles, solar power cells, and advanced fuels like ethanol.

The U.S. Department of Energy works with local governments to help low-income families permanently reduce their energy bills by making their homes more energy efficient.

Americans receive a $3,400 tax-credit for purchasing a hybrid car. Last year, 200,000 such cars were sold in the United States.

In American stores, large household appliances are labeled with energy efficiency information. This label allows American consumers to calculate the savings through reduced electricity bills when they purchase such products.

And there are many, many more programs. . .

President Bush stated in his recent speeches on energy efficiency that, "we are in an important moment in history in that we have a chance to transform the way we power our economy and how we lead our lives." As we become more energy efficient, we boost our productivity and strengthen our economy.

Again, this is true not only in the United States but all over the world.

Ukraine should take today's focus on energy efficiency as an opportunity to strengthen its economy by modernizing inefficient, energy-wasteful processes, and developing new domestic sources of energy, like coal bed methane and its potential off-shore oil and gas reserves.

It is very important that the Ukrainian government open exploration here not just to Ukrainians, but to efficient, global firms.

The government's role in promoting energy efficiency could be to offer market-based incentives and stimuli for efficiency modifications and alternative fuel sources. Incentives, as opposed to state-administered norms, allow individual businesses to make the energy efficiency investments that are right for their specific enterprises. It is important to note that international financial institutions may also be interested in assisting Ukrainian businesses with loans to modernize their processes. Of course, the attractiveness of such investments will depend on the level of transparency of the company and the deal. Money invested today in more energy efficient processes will make Ukraine's economy more competitive as it continues its integration into global markets.

I would like to thank you all for participating in this seminar and sharing your insights on how to enhance Ukraine's national and economic security through greater energy efficiency.

I wish you a very fruitful - or should I say, energetic -- discussion.

Thank you very much.