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August 1, 2008
Boone
Pickens' Energy Crusade: Prophet or Con
Man?
by Jay Hakes
Author of A Declaration of Energy
Independence:
How Freedom from Foreign Oil Can Improve National
Security, Our Economy, and the Environment
T.
Boone Pickens has broadcast his way right into the
middle of a presidential election debate about
United States energy policy. Americans are upset
about $4 a gallon gasoline, and the iconoclastic
oilman has bought a lot of air time to tell us what
he thinks about the situation.
Pickens' views have injected some fresh air into
the public dialogue, and most of his ideas stand up
pretty well to the scrutiny of serious energy
analysis. But we must be careful not to replace one
set of problems with another.
His ads and web site warn about the money sucked
out of the American economy by its negative balance
of trade in energy. Pickens has identified a
problem as least as big as high prices at the pump.
The energy trade deficit is larger than our trade
imbalance with China and far more costly than the
war in Iraq. Moreover, much of the money ends up in
the hands of America's enemies. Though some
laissez-faire economists find this situation
acceptable, it's hard to argue that our dependence
on foreign oil can be sustained at current levels
over the long haul without further damage to the
dollar and the general U.S. economy.
A vigorous American Petroleum Institute
advertising campaign, President Bush, and
presidential candidate John McCain imply we can
drill our way out of our dependence on foreign oil.
Pickens disagrees. Again, score one for the man
living in our television screens. Offshore oil
drilling is expensive and unlikely to lower oil
prices or have a dramatic impact on the world oil
market. We shouldn't rule out some carefully
monitored expansion of lands available for
exploration and development. But opening up more
offshore areas in a country that has been drilling
away since 1859 won't be a game changer in an
expanding world oil market.
Pickens emphasizes renewable energy,
particularly wind power, as a solution to our
energy predicament. Wind supplies a significant
share of energy in some European countries and is
growing here. We should expand the role it plays in
electric generation.
But overemphasis on wind can distract attention
from solar power and biofuels (not derived from
food products), which offer greater potential for
further technical development.
The idea that we should use government subsidies
to get wind and other renewables into the market
overlooks a big problem. The amount of fuel we
consume is so large that subsidies will have
unacceptable budget impacts for any fuel that
achieves broad usage. The key policy here is making
sure the fossil fuels pay their own way for
external costs related to national security and the
environment.
We should also adopt a national renewable
electric generation standard that mandates a
greater share for these clean and domestic sources,
as many states have already done. Last year, the
U.S. Senate came very close to breaking a
filibuster against such a standard. After what has
transpired since that vote, the Congress should
quickly adopt the standard next year with tougher
provisions than in the 2007 version.
Pickens correctly points out that expanded use
of wind and solar, while intermittent, can save
significant amounts of natural gas, the most
environmentally benign of our fossil fuels and
largely available from domestic sources. He then
advocates that natural gas resulting from this
displacement be used to power America's vehicles.
This would cut the need for foreign oil, reduce
pollution and has been technically doable for a
long time.
But this is the fork in the road where Pickens
makes the wrong turn. Until we figure out how to
sequester the carbon emissions from coal-based
electricity or add significantly to the number of
nuclear plants, we face a critical need for natural
gas to reduce the use of coal. After having ignored
the problems of greenhouse gases and global warming
for decades, our nation cannot add more coal plants
without risking great damage to our climate.
There's not enough gas to take on bigger roles for
both transportation and electricity.
Fortunately, there are other alternatives for
powering our cars and trucks that will work as well
or better than natural gas. First and foremost, we
need to demand more efficient vehicles. The Energy
Independence and Security Act passed last year
mandates that the 25 miles per gallon currently
required for cars and light trucks be raised to 35
mpg by the year 2020. But we should not have much
trouble raising the standard by a mile and a half a
year. That get's us to 40 mpg by 2020 and 55 mpg by
2040.
Ethanol produced from corn kernels is not worth
the federal subsidies currently provided. But we
should be utilizing liquid fuels from other plant
sources, such as corn stover (the waste materials
left over), bagasse from sugar cane, wood chips,
and switchgrass. Even more exciting, but perhaps
further down the road, is biofuel produced from
algae. We also have the option of plug-in electric
hybrid vehicles, which are very attractive
economically, especially if recharging takes place
at night when the demand on the electric grid is
low. In other words, we can take the bold action
Pickens calls for and still reserve natural gas for
electric generation.
The Texan who wants to end our addiction to
foreign oil may not have every detail right, but we
should be grateful that he's calling for some
mighty big solutions to some mighty big
problems.
From
1993 to 2000, Jay Hakes headed the Energy
Information Administration, the data and analytic
arm of the U.S. Department of Energy. He has just
published A Declaration of Energy Independence:
How Freedom from Foreign Oil Can Improve National
Security, Our Economy, and the Environment
(John Wiley & Sons, 2008).
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