AS THE PRICE of oil hovers near $140 per barrel, talking heads fill the airwaves with dramatic statements about America's energy future. The talk seems endless, and strangely, commentators all seem to think that we have never dealt with these questions before.  

I remember the oil spikes of 1973, 1980 and 1990. Time and circumstances may have changed, but families and small businesses in New Hampshire feel it just the same. Higher prices for heating oil, gas, and propane drain budgets and hurt the economy. This challenge, like those past, can and must be overcome.  

While the date has changed, the proposals from the far left have not: Increase energy taxes, start a lawsuit, ignore the potential of nuclear power, and above all, oppose all new production of American oil and gas.  

We can do better -- we must do better -- than just looking back to failed policies of Jimmy Carter and the 1970s. The path forward lies in a balanced approach: conservation, alternative energy and domestic production -- not extremism from one side or the other.  

There is no "magic bullet" that will instantly resolve our energy crisis. Future technologies such as hydrogen fuel cells should be pursued and funded by both the private sector and government programs such as the National Science Foundation.  

As the market develops new technologies, we need to act now with common-sense steps in three key areas that we know will bring benefits tomorrow and for years to come: 

-- Smart energy policy begins with conservation. Energy saved each day and over the long term makes a significant difference. Today, our economy uses 45 percent less energy to produce a dollar's worth of goods and services than in 1977. We need to build on this success.  

Legislation signed into law last December will do just that. For the first time in 32 years, Congress increased average fuel economy standards for cars and SUVs -- from 25 miles per gallon today to 35 miles per gallon by 2020.  

-- We must also invest aggressively in alternative energy sources with a proven performance record. Wind, solar, hydroelectric, biomass, and geothermal systems are more competitive than ever. They account for nearly 10 percent of energy production in the United States, and there is no reason we can't double this performance during the next five years.  

I have cosponsored legislation to extend and strengthen the tax credits available for alternatives, and I will continue to insist that they be part of our national supply network.  

-- Finally, politicians need to take their heads out of the sand when it comes to energy production. How can we hope to reduce our dependence on Middle East oil if we refuse to allow new American energy exploration?  

Questions about speculation and price manipulation in the energy futures market must also be addressed. Regulations should be strengthened to improve transparency, set clear limits on positions a trading firm may take, and provide additional funding to the Commodity Futures Trading Commission to effectively oversee and prosecute potential violations.  

Today, more than ever, America must implement common-sense policy that will make a difference for years to come.  

Real progress will not take place overnight. Wind farms, nuclear power plants, biomass facilities, and oil and gas platforms all take time to build. But delaying action today will only delay the benefits of a more diverse energy network: more stable prices, and greater energy independence for America.  

Sen. John E. Sununu, a Republican, represents New Hampshire in the U.S. Senate.