NEWS ANALYSIS : The Search for Clinton’s Energy Omens : Transition: Companies are seeking clues as to what changes the President-elect will seek. Some see far-reaching shifts in policy ahead.

President-elect Bill Clinton has said he plans to staunch growing foreign oil imports through conservation and by encouraging greater use of domestic natural gas and renewable energies such as solar and wind power. By all accounts, this will be a formidable task.

Recent administrations have not made oil-import reductions a priority, in large part to keep energy costs down at a time when U.S. industries were struggling to compete internationally. President Bush, in particular, has favored low oil prices and allowing alternative energy sources to slug it out on their own in the marketplace.

If Clinton is successful, far-ranging changes in the nation’s energy industries could be ahead.

“To set out to reduce the import of foreign oil, that’s a big step. And for the last three Presidents, it wasn’t really their goal,” said Frank G. Zarb, who headed the Federal Energy Administration, now the Department of Energy, during the Ford Administration. “The political price you pay for this doesn’t make anybody happy down the road,” added Zarb, now president of Smith Barney, Harris Upham Inc.

Yet Clinton comes to office at a time of growing worldwide concern over the environment and continuing pressure to reduce the nation’s foreign trade deficit. Oil imports account for about half the nation’s trade gap.

At the same time, energy conservation and pollution-control costs are weighing heavily on many industrialized nations. And so the stakes have become global. The patterns of U.S. energy use over the next few years will both influence and reflect worldwide shifts.

“America is part of a global movement toward natural gas,” said Daniel Yergin, president of Cambridge Energy Research Associates and author of “The Prize,” a Pulitzer Prize-winning history of the oil business. Yergin said natural gas, once a “stepchild” to the oil industry, will gain new prominence because it is clean-burning and competitively priced.

As the energy industry awaits the first policy moves of the Clinton Administration, executives are watching for hints of what’s ahead in Clinton’s appointments and the statements of his transition team.

Many like what they see. Clinton’s choice for energy secretary, Hazel O’Leary, gets wide praise for her experience as a utility executive and regulator.

“She’s probably ideally suited for the job,” said Edward J. Tirello Jr., veteran utility analyst at Smith Barney. “She actually knows what she’s doing.”

U.S. oil companies take comfort in the President-elect’s choice of Sen. Lloyd Bentsen (D-Tex.), an old campaigner in the oil patch, as Treasury secretary.

“Bentsen is the foremost person who understands what energy policy means, and I think Clinton and Bentsen think very much alike,” said Kenneth R. Dickerson, a senior vice president at Los Angeles-based Atlantic Richfield Co.

Dickerson sees a balance in Clinton’s appointments that he likes: “You begin to get a feeling that this President is not an extremist and will not tolerate extremism in any of his appointees.”

Oil executives, however, do not expect Clinton to open Alaska’s Arctic National Wildlife Refuge to oil and gas exploration--an issue they crusaded for during the Bush Administration.

Many large energy companies see a possible advantage in Clinton’s interest in natural gas--both to power electric-utility boilers and as an interim fuel until other non-polluting fuels can be developed.

Such long-range technologies as hydrogen fuel cells are still years away from commercial use. Almost all the major oil companies also produce natural gas. Chevron Corp., in fact, is the largest gas producer in the country.

If the economic recovery strengthens--which would increase fuel consumption--Clinton’s hopes for increased use of domestic gas will encourage the hunt for new U.S. supplies, according to the big energy companies. This, they say, should prompt reconsideration of the moratorium on offshore drilling on the Outer Continental Shelf, from California to Florida.

“One of the enigmas of the offshore moratorium is that it is indiscriminate about whether it bans drilling for natural gas as well as oil,” said Richard J. Stegemeier, president and chairman of Unocal Corp.

An oil-well blowout or spill puts oil on the water, he pointed out, while a natural-gas blowout is disseminated harmlessly into the breeze.

The move to domestic natural gas would be particularly good news for smaller U.S. oil and gas companies, which have more than 90% of their production in this country. They already produce 60% of domestic gas.

“We’re very optimistic,” said Denise A. Bode, president of the Independent Petroleum Assn. of America, representing 8,000 independent producers. “Clinton has made our product the centerpiece of his energy policy.”

Bode and others are encouraged by Clinton’s choice of boyhood chum Thomas (Mack) McLarty as White House chief of staff. Until recently, McLarty was chairman and chief executive of Arkla Inc., a Louisiana natural gas company.

Critics of natural gas still worry about the stability of prices and supplies, bringing back memories of natural gas shortages during the 1970s’ energy crises. But Bode and others say that current estimates of plentiful U.S. reserves, deregulation of the pipeline system and the construction of new pipelines and storage facilities render these fears obsolete.

“As an industry, we tended to fight a lot and shoot each other a lot,” Bode said, “which tended to make people nervous about the supply . . . but we’re working together now.”

The tattered nuclear power industry also sees a ray of light in Clinton’s appointment of utility industry executive O’Leary as energy secretary.

She knows firsthand the pressure the nation’s utilities are under to find storage for their spent high-level radioactive fuel rods.

Though the federal government has promised the nuclear industry a permanent site for its waste by 1998, the only project to meet that goal, Yucca Mountain in Nevada, is facing protests from environmentalists and Nevadans who fear that radiation could be released in the event of an earthquake.

As recently as last March, O’Leary was lobbying Congress for interim help by allowing utilities to build temporary surface storage facilities.

Her current employer, Minneapolis-based Northern States Power Co., nearly became the first utility in the country to have to shut a nuclear power plant for lack of waste storage.

“Hers is a very hopeful appointment because she has lived the problem,” said Carl Goldstein, a vice president of the U.S. Council for Energy Awareness, the industry trade association.

The nuclear industry hopes to see a new generation of cheaper, safer U.S. nuclear power plants under construction by the late 1990s.

Goldstein says Clinton’s energy advisers may be placing too much confidence in natural gas’s potential as a “bridge” fuel. “We believe that a new generation of nuclear power plants is part of that bridge,” Goldstein said, “that it will have to be part of that bridge.”

There’s been little talk from Clinton about the role that coal will play in the nation’s energy policy in the 1990s--and that has the industry worried.

The invasion of natural gas into coal’s majority share of the almost $40-billion electric-power generation business is “heavy duty,” said Yergin of Cambridge Research, “and it’s already happening.”

While natural gas utility boilers that meet air pollution standards are now available, the first clean-burning coal technology has not been built on a large-scale basis.

But the U.S. coal industry’s main worry is the incoming Administration’s talk of a carbon tax--a measure that would tax fuels based on their carbon content.

The idea is to promote greater use of lower-carbon fuels to reduce sulfur dioxide emissions, blamed by many scientists for global warming problems. Some economists have suggested using revenue from the tax to help cut the federal deficit.

John Grasser, of the National Coal Assn., believes that the carbon tax would be at cross-purposes with another Clinton plan to boost use of domestic energy sources. U.S. coal reserves, he pointed out, could last an estimated 270 years at current consumption levels.

“Does it make any sense to leave this in the ground when we have the technology to burn it cleanly?” Grasser asked. Coal is also comparatively cheap, costing about 30% less than natural gas.

“If it goes to a carbon tax, the coal industry can kiss its ass goodby,” said J. Robinson West, president of Washington-based Petroleum Finance Co. Ltd. and a former assistant secretary of the Interior during the Ronald Reagan Administration.