budget-related and are described below. Others have no direct relationship to appropriations but are crucial nevertheless to fulfilling the Administration's energy goals. I include in this category repeal of the Windfall Profits Tax; complete natural gas decontrol; oil pipeline deregulation; reauthorization of the Price-Anderson Act; oil exploration authority in the Arctic National Wildlife Refuge; adoption, by FERC, of market-based reforms in the electricity industry; and favorable consideration of the U.S.--Canada Free Trade Agreement and the U.S.--Japan agreement for nuclear cooperation. I want to stress the importance of these reforms: repeal of the Windfall Profits Tax, for example. This tax imposes a needless paperwork burden on the industry and it discourages new investment in domestic oil production. Approval of these proposals, together with the legislation which directly supports the budget request, will go far toward establishing this nation's scientific preeminence and energy strength. The recent action by the Senate Energy and Natural Resources Committee recommending the opening of the Arctic National Wildlife Refuge to oil exploration is an important step toward achieving this legislative agenda.

BUDGET THEMES AND INITIATIVES

This budget achieves the Nation's and the Department's objectives by continuing to strive to direct Federal funding only to those activities that are clearly the responsibility of the Federal government; meeting critical defense requirements for nuclear weapons and materials; strengthening partnerships between national laboratories, universities, and industry; encouraging cooperative research and development ventures with industry;

divestiture of certain Federal assets where the justification for Federal ownership is limited; a strong commitment to basic research; enhanced funding for worker and public health and safety and environmental protection and restoration at the Department's facilities; strong support for the Clean Coal Program; and a continued commitment to safeguards and security at the Department's facilities.

Major initiatives in FY 1989 include the first year of substantial funding for the Superconducting Super Collider, a major basic science project which will ensure world leadership for the United States in high energy physics. Another major initiative will improve our protection against possible oil supply disruptions by selling Naval Petroleum Reserves 1 and 3 and applying the proceeds to double the fill rate at the Strategic Petroleum Reserve and to establish a dedicated Defense Petroleum Inventory. The budget also supports continuation of recent progress in superconducting materials as well as the translation of those material advances to practical technologies through applied research. We believe these new high temperature superconducting materials could make significant future energy efficiency gains and have novel applications not yet clearly envisioned.

Finally, to strengthen its oversight of nuclear facilities and operations, the Department is proposing significantly higher funding for safety improvements and environmental restoration and oversight activities in response to a number of internal and external studies of the Department's reactor complex, including the recently released National Academy of Sciences/National Academy of Engineering study of the safety of the Department's production reactors.

With this introduction, let me turn now to the FY 1989 budget request.

FY 1989 BUDGET SUMMARY

The FY 1989 budget request for the Department of Energy is $16.1 billion, an increase of about $2 billion over FY 1988. Although the request is 13.7 percent above the FY 1988 level, the level of actual program activity would increase only 11.8 percent because of substantially higher levels of prior year funds available in FY 1988. The increases are to be found primarily in the Strategic Petroleum Reserve, Basic Science Research programs, Uranium Enrichment, the Nuclear Waste program, Defense activities, and the Clean Coal Technology program.

At this point I would like to discuss the budgets for selected program areas.

BASIC SCIENCE RESEARCH

A long-standing goal of this Administration has been to maintain the nation's scientific and technological preeminence. Over the past several years the Department's basic science budgets have been among its fastest growing accounts. The Department proposes to continue this growth in FY 1989.

This increase is due principally to the inclusion of the first year of major construction funding for the Superconducting Super Collider (SSC). It should

be noted that the SSC is not being funded at the expense of existing research projects, but is in addition to the amounts considered necessary for these other worthy activities.

For FY 1989 the Department is proposing $363 million for construction and research and development of the SSC. The enhanced funding for research and development in the SSC program is required to finalize design of the superconducting dipole magnets and various other related technical systems and to proceed with the detector development program.

A major effort in FY 1988 involves site selection activities. Final site selection is scheduled for FY 1989, and initial construction activities for the SSC will begin that year. The requested funding will cover such construction activities as the following: detailed design of technical systems and conventional facilities; long-lead items for power stations and utilities; and the injector and collider components' long-lead items. A substantial portion of the total project cost will be solicited from non-federal sources such as foreign investors, based on the anticipated benefit of the project to the international scientific community. With continued funding as planned, the project can be completed in 1996.

I should note that initial contacts were made in January with OECD countries about their interest in and prospective contribution to the SSC.

The response

to date has been very positive and foreign scientists are already contributing to the design phase. However, the clear position of all these countries was that a demonstrable U.S. commitment to the project, reflected by bipartisan

Congressional support for our FY 1989 budget request, was a prerequisite to the substantial contributions on their part that we anticipate in later fiscal

years.

Another major project in this budget, which shows promise for making

significant contributions to the Nation's scientific and technical stature, is the initiation of construction on the 6-7 GeV Synchrotron Light Source at Argonne National Laboratory. This project will aid the U.S. in maintaining its competitive position in areas such as semiconductors, supercomputers, biology, chemistry and materials. Synchrotron radiation emitted by circulating electron or positron beams has emerged as a very powerful and versatile source of vacuum ultraviolet light and x-rays, and is very effective for probing the structure of matter and for studying various physical

processes.

Beginning in FY 1989 the SSC, the 6-7 GeV Synchrotron, and all other major user facilities presently supported in the High Energy Physics, Nuclear Physics, and Basic Energy Sciences program budgets will be budgeted for in a new account entitled Basic Research User Facilities. This new account will ensure that the SSC and other basic research user facilities will continue to receive the appropriate emphasis in the funding process. With enhanced visibility we can be better assured that the facilities receive the resources required to keep them operating at effective and efficient levels.