THE PRESIDENT: Good morning.

Last Saturday, I addressed the annual retreat of Democrats from the House of Representatives. I thanked the Members of the new majority for their service in Congress. And we discussed our responsibility to work together on a wide range of issues -- from fighting the global war on terror, to making health care more affordable, to balancing the Federal budget.

One area with great potential for bipartisan cooperation is energy policy. The need for action is clear. Our Nation's reliance on oil leaves us vulnerable to hostile regimes and terrorists, who could damage our economy by disrupting the global oil supply. A spike in oil prices anywhere in the world could lead to higher prices at gas pumps here in America. And burning oil and gasoline creates air pollution and greenhouse gases.

Republicans and Democrats both recognize these problems. We agree on the solution: We need to diversify our energy supply and make America less dependent on foreign oil. The best way to do that is by developing new energy technologies here at home. So the Federal government has provided more than $10 billion over five years for research into alternative sources of energy. Our scientists and engineers have made great progress, and our Nation is now on the threshold of dramatic breakthroughs in clean energy technology.

These advances in energy technology will help us meet a great new national goal: to reduce America's gasoline usage by 20 percent in the next 10 years. I call this goal "Twenty in Ten," and appreciate the support that many Democrats and Republicans have shown for it.

I know there are different views about the best way to meet this goal. Some say we should increase the supply of alternative fuels. Others say we should decrease demand for gasoline. I believe we need to do both. So on the supply side, I proposed a new mandatory fuels standard that will require the use of 35 billion gallons of renewable and other alternative fuels by 2017. That is nearly a fivefold increase over the current target. On the demand side, I proposed to reform fuel economy standards to make cars more energy efficient, just as my Administration did for light trucks.

This past week, we took a key step toward my "Twenty in Ten" goal when I sent Congress my budget for the next fiscal year. The budget proposes $2.7 billion to expand alternative energy research, a 53 percent increase over the 2006 funding level. These funds will support further research into cellulosic ethanol, which can be produced from sources like wood chips and grasses. These funds will also support promising technologies beyond ethanol, such as new forms of biodiesel, lithium-ion batteries, and hydrogen fuel cells.

I look forward to working with Congress to pass this budget and to meet my "Twenty in Ten" goal. I'm optimistic because the technology we need to achieve this goal is advancing every day. A few weeks ago, I traveled to a DuPont research facility in Delaware, where scientists told me that they are close to making the use of cellulosic ethanol a reality. Imagine what technologies like this would mean for your daily life. You could fill up your gas tank with fuel that comes mostly from an American prairie or farm, instead of an oil well overseas. You could drive to work in a car that runs on electricity instead of gasoline, or on hydrogen fuel cells that emit no pollution. You would see the rise of dynamic new businesses that create jobs for American workers and sell alternative energy products around the world.

This is an ambitious vision, but with the talent and enterprise of our people, it can be achieved. Every Member of Congress who cares about strengthening our economy, protecting our national security, and confronting climate change should support the energy initiatives I have set out. By working together to pass energy legislation soon, we can help solve one of the great challenges facing our generation. And we can leave behind a cleaner and better world for our children and grandchildren.

Thank you for listening.