“There is little doubt that today the ability of industry and government to respond is considerably strengthened from what it was at the time of the [Exxon Valdez] spill.”

In addition to continuing to explore for new sources of petroleum, we need to ensure that every drop of extractable oil is taken from both old and new wells. For example, Encore Acquisition Co. has employed “high-pressure air injection to boost its reserves by an additional 57 million to 200 million barrels of oil.” The process works by having “compressors pump 15 million cubic feet of air each day at 5,000 pounds per square inch into a rock formation 9,000 feet below. The high-pressure air then naturally ignites with the oil and generates flue gas, steam and a pressure front the pushes the oil to the producing well.” The result is, that “since 1999 Encore has boosted production by an average of 24% and its proved reserves by 20% at a time when the rest of the industry has been flat to slightly down in both key categories in the U.S.” (Ref. 8)

Beth Daley (Ref. 9) has written, “At Fort McMurray in Alberta, Canada, oil is being extracted from oil sands by Syncrude Canada, Ltd. Because of technology improvements, oil sands companies have been producing oil for as little as $24 a barrel – making for a huge profit for companies when the oil prices hit $70 a barrel, as they did briefly in recent months.”
   “The recently passed energy bill calls for research and the start of a commercial leasing program on federal lands to hasten the nation’s own development of oil shale reserves in Colorado, Utah, and Wyoming, in part by tapping into Alberta’s expertise. Oil shale is similar to oil sands, but the process of extracting crude is more difficult.”
   “The United States has between 500 billion and 1.1 trillion recoverable barrels of oil from shale reserves, according to a report sponsored by the US Department of Energy. Eight hundred billion barrels, the estimate’s midpoint, is enough oil to meet 25 percent of the nation’s current demand for the next 400 years, the report says.”

Ecological concerns are real, but restoration efforts in Canada show that these concerns can be met. In spite of the doomsday ecologists, modern technology has consistently proven that, where there’s a will there’s a way. It need not be humanity or nature - instead, it can be humanity in balance with nature and yes, we can extract resources from the earth while protecting or restoring it.

Peter Huber, in the October 31, 2005 issue of Forbes (Ref. 10) wrote, “. . . the people extracting oil out of tar sands today use gas from the fields themselves to power their refineries. There’s gas, too under what has been called Alberta’s ‘trillion-barrel tar pit’ “
   “As an alternative to gas, Total S.A., the French oil giant, is thinking about building a nuclear power plant to supply heat to melt and crack the tar.”

Natural Gas:   Jeffrey E. Garten (Ref. 3) makes a case for greater centralized federal control over supplies of natural gas. According to Garten: “Today natural gas in all its varieties accounts for 25% of U.S. energy needs, but that proportion is sure to increase because environmentally friendly gas has become the fuel of choice for new electric power generating plants. Although LNG [Liquefied Natural Gas] accounts for only 3% of natural gas usage today, FERC [Federal Energy Regulatory Commission] estimates LNG could grow to over 25% of that within 15 years.”

In order to provide an ample supply of foreign LNG, Garten urges Washington to “ensure that LNG supplies are strategically diversified.” In addition, “While LNG terminals cannot now operate without a government O.K., such authority is split among FERC, the Maritime Administration, and individual state governments. To lessen the possibility of an OPEC-type gas cartel developing and jeopardizing our economic and national security, Washington should exercise more centralized control, involve the National Security Council in permit reviews, and use its leverage to ensure that imports come from the widest range of suppliers”.

The impact of a shortage of natural gas is all pervasive in America’s economy today. Christopher Helman, in late October 2005 wrote, (Ref. 11): “. . . the chemical industry . . . is getting hammered by natural gas prices, which have doubled in the last 12 months to $14 per million BTU’s. ‘The U.S. is in a natural gas crises,’ Dow Chemical Chief Executive Andrew Liveris testified to a Senate committee.
   “The chemical industry, the nation’s largest consumer of natural gas, both for energy and as a chemical feedstock, is rapidly moving offshore in search of cheaper gas – and taking jobs and capital with it. The potential blow is enormous. The industry sells $500 billion a year of plastics, films and resins that make up thousands of consumer products. It directly employs 885,000 people in the U.S.
   “Dow, for instance, has shut 23 inefficient plants in North America since 2002, moving production to nations where gas is plentiful, like Kuwait (at $1.25 per million BTU’s and Argentina ($1.60).
   “The global chemical industry has 120 projects under way, with capital investment of $1 billion. Just one is in the U.S., while 50 are in China (where gas is $4.85 per million BTU’s) and many of the rest are in the gas-rich Middle East. {my emphasis} How can I recommend investing here?’ Liveris asked the Senate.”
   “Current stocks [of natural gas] are 151 billion cubic feet less than at the same time last year, and it looks like the nation will enter winter with 3.1 trillion cubic feet in storage versus last year’s 3.3 trillion. A cold winter could draw stocks all the way down to the 500 billion cubic feet the pipeline network must maintain just to stay pressurized.
   “If the inventory slides too close to 500 billion cubic feet, industrial users would be ordered to curtail use in order to safeguard supplies for home heating. But those supplies won’t come cheap. The Energy Department estimates that home owners will pay 70% more for natural gas this winter.
   “What does industry want? More domestic supply, which means quick assurance that Congress will open gas-rich acreage on the Outer Continental Shelf. ‘If not,’ says Jack N. Gerard, president of the American Chemical Council, ‘companies will have to start making those tough decisions’ – firing their factory workers that is. Right now the U.S. produces 84% of the natural gas it consumes, with most of the rest coming from Canada.
   “Industry would also welcome any law that would make it easier to win approval for construction of marine terminals for the import of liquefied natural gas. For now, coast dwellers are able to use the public’s not entirely rational fear of fireballs and environmental impact to block plans for LNG terminals.
   “Another possible fix for the long run: coal gasification.”

Renewable Sources of Energy:   Oil, coal and natural gas are non-renewable sources of energy and cannot be replaced as they are used up. Renewable sources of energy, on the other hand can be replaced, primarily from the energy produced by the sun in one way or another. One aspect of any comprehensive energy policy must include the increased development of renewable and clean sources of energy. These sources currently include hydroelectric power generation, wind power, burning and gasification of wood and biomass, geothermal, solar, and burning and gasification of municipal solid waste. Further out, the so-called hydrogen economy is a major hope for renewable energy in the future. The May 2005 issue of Technology Review (Ref. 12) reports that, “Renewable energy now accounts for about 8 percent of global energy consumption, a figure not expected to shift substantially over the next 20 years. Hydroelectric plants are responsible for the vast majority of the renewable power generated in the United States, but their output is expected to increase only slightly over the next 20 years. Wind and biomass generation, on the other hand, should produce an increasing share of the country’s renewable energy.” Also included in Ref. 12 is an optimistic projection from the Energy Department’s Office of Energy Efficiency and Renewable Energy that conventional petroleum powered vehicle shipments will continue for the next 30 years, but at rapidly decreasing rate until shipments decrease to essentially zero by the year 2035. In that same period of time, shipments of hybrid vehicles will grow to more than 50% of vehicle shipments just before the year 2025 and then fall to zero around 2040. Hydrogen powered vehicle shipments will grow slowly until 2025, when, the rate of increase will explosively increase until all shipments after 2040 will be for hydrogen powered vehicles.

Wind Power:   Based upon a study by researchers at Stanford University, MIT’s Technology Review magazine (Ref. 13), reported that, “there is easily enough potential wind power to meet the world’s electricity demands.” However, “in 2002, just .3 percent of the world’s electricity supply came from wind power.” The U.S. ranked 3rd among the world’s wind-power generation nations, producing 14% of the world’s total. Germany (35%) and Spain (18%) both surpassed the U.S.

According to David Talbot (Ref. 14), “Wind power, already the world’s fastest-growing source of electricity, is picking up still more momentum. The wind industry in Europe - the epicenter of wind power adoption - expects that one-quarter of the continent’s new electricity-generating capacity in the next decade will come from wind.” Further, “The goal of industry and federal researchers is to create wind farms that produce electricity for about three cents per kilowatt-hour, down from about 4.5 cents today; that would beat the cost of fuel for the most efficient new gas-fired plants - currently about 5.5 cents per kilowatt-hour. If the development process goes well, … these huge turbines should be ready for widespread wind farm use in 2012.”

Similarly, as reported in Ref. 15, “Wind power is perhaps the greatest success story. Mass production and improved engineering have made modern wind turbines big (generating two to five megawatts each), extremely reliable and environmentally quite benign. Denmark already gets 1 fifth of its electricity from wind, Germany a tenth. Germany and Spain are each adding more than 2,000 megawatts of wind power each year, and Europe aims to get 22 percent of its electricity and 12 percent of its total energy from renewables by 2010.”

Ref. 15 points out that, “The most common criticism of wind power - that it produces electricity too intermittently - has not turned out to be a serious drawback. In parts of Europe that get all their power from wind some days, utilities have overcome the problem by diversifying the locations of their wind turbines, incorporating wind forecasts into their generating plans and integrating wind power with hydroelectricity and other energy sources. Wind and solar power work particularly well together, partly because the conditions that are bad for wind (calm, sunny weather) are good for solar, and vice versa. In fact, when properly combined, wind and solar facilities are more reliable than conventional power stations - they come in smaller modules (wind turbines, solar cells) that are less likely to fail all at once, [and] their costs do not swing wildly with the prices of fossil fuels.”

The October 25, 2005 issue of the Boston Herald (Ref. 16) reported that, “Texas has sold a lease for an 11,000-acre tract in the Gulf of Mexico that backers believe could become the first wind-energy farm along the U.S. coast, Texas officials announced yesterday.”

   “The wind turbines planned by Galveston Offshore Wind, a subsidiary of Wind Energy Systems Technologies [W.E.S.T.] of New Iberia, LA, would be seven miles off Galveston Island.”

   “Construction is expected to be completed within five years at a cost of $300 million. W.E.S.T. plans to construct about 50 wind turbines, expected to produce 150 megawatts of electricity, enough to power about 40,000 homes.
   “Two other offshore wind turbine farms have been proposed along the U.S. coast of the United States, including one in Nantucket Sound, off Cape Cod. Another has been proposed off the south shore of New York’s Long Island. The Nantucket project, also in federally controlled water, faces opposition because of fears it would ruin the ocean view from the shore.” {my emphasis }

The wind power industry is today fighting a battle with the environmentalists (who argue that large turbines kills migratory and other birds) and NIMBYs (Not In My Back Yard) who object to the sight of wind generation turbines spoiling their view of nature.

Nuclear Power:   Nuclear power plants consume no fossil fuel and produce no harmful greenhouse gasses. On the other hand, spent fuel presents a problem in disposal and storage, and the danger of the catastrophic release of harmful radiation, while highly unlikely in a properly designed and maintained nuclear power plant, is still real. Having said all this, the conclusion of many unbiased rational people, is that the benefit-to-risk ratio strongly favors a greatly expanded and expedited nuclear power plant development program in the United States.

As David Talbot has reported (Ref. 17), “The U.S. nuclear-power industry has been stagnant for three decades; the last successfully completed reactor order was made back in the 1970s. The Three Mile Island accident, and the far worse 1986 Chernobyl catastrophe, helped stop the industry in its tracks. … regulatory pressures, political opposition, and costs surged.” Today, rising oil and gas prices and dwindling supplies have changed the economic picture. The specter of foreign oil embargoes and foreign control over supplies of LNG are changing the American mindset. In addition, emissions from fossil fuel powered electricity generation plants are under increasing attack from environmentalists.

Again from Ref. 17, “Abroad, 24 nuclear power plants – including eight in India, four in Russia, and three in Japan – are now under construction.” “Today’s 104 operating U.S. nuclear power plants … reflect the designs of the 1960s and the technologies of the 1970s.” In the United State, nuclear power plants generate just under 20% of the country’s electricity. (Ref. 18)

Today, improvements in a wide range of technologies enable the construction of very safe and less expensive nuclear power plants. Also, the permitting process was streamlined in 1992 by a change in federal law that shortens and simplifies the procedures for obtaining a license. The federal government is also sharing the financial risk by providing subsidies to companies wanting to build new U.S. nuclear power plants.

Potentially, nuclear power plants can support a move away from hydrocarbon fuels toward the “hydrogen economy”. It can do this by using the electricity it produces to directly split water into hydrogen and oxygen through electrolysis, without creating air pollution. Also, hydrogen can be directly produced by splitting water molecules with the extremely high temperatures that exist inside nuclear reactors.

As Talbot notes, “While the waste problem remains unsolved, current trends favor [demand?] a nuclear renaissance. Energy needs are growing. Conventional energy sources will eventually dry up. The atmosphere is getting dirtier.”

While the problem of nuclear waste disposal still exists, it is by no means insoluble. Several solutions have been proposed. One solution (Ref. 19) involves something called “deep borehole disposal”. This process involves drilling a hole about 1 ft. in diameter down some 2.5 miles into the earth’s crust into granite rock formations “that have sat undisturbed for billions of years.” Some four hundred 1 ft. diameter, 15-ft long containers of nuclear waste are then lowered into the hole, which is topped with absorbent clay and concrete.

Scientists at the Los Alamos National Laboratories and at MIT have concluded that, with additional study, deep borehole disposal could be a very safe method. “Already Finnish nuclear utility Posiva is test-drilling the rock beneath Olkiluto island with the idea of interring waste one-third of a mile down. Sweden is considering its own plan.”

In the case of the United States, “Granite underlies much of the U.S., allowing for regional depositories that could cut the costs and risks of transportation.” So why aren’t we using this technology now? Because a federal mandate exists that requires nuclear waste stowed anywhere to be retrievable for 100 years in case anything goes wrong. What is needed now is the revocation of this mandate, the funding of the additional studies to verify the safety of the process, and the immediate start of test-drilling to verify the practicality of the process and to iron out any bugs. For too long, the U.S. has let the problem of nuclear waste disposal go unsolved. We cannot delay any longer.

Based upon experience with Nuclear power in the 1960’s, “Nuclear power was a financial disaster.” (Ref. 20) The disaster resulted from “engineering and political problems. Construction advanced at a snail’s pace.” Opponents to nuclear power stretched out the permitting process, raising the cost of these power plants. Consequently, the cost of energy from nuclear power plants turned out to be higher than planned and the cost of oil, with notable exceptions in 1973-1974 and 1979-1980, remained low. Today, the cost of oil and natural gas has risen sharply.

Currently, power from older nuclear power plants is cheap, since the costs of the plants themselves have already been written off. “Their cost of fuel is miniscule.” “Even with all other costs thrown in, nuclear plants today produce power at less than half the cost of plants that burn natural gas or oil.” Today, “Nuclear power is a bargain; oil and gas are a financial disaster.” (Ref. 20)

Interestingly, while nuclear power generation has stagnated in the United States in the last decades, nuclear power has flourished overseas. An ICJT Nuclear Training Centre web site (Ref. 21) reports that, as of October 2005, there were some 442 operating nuclear power plants (NPPs) worldwide, with 104 of these in the United States. Worldwide, 41 new NPPs are under construction, 92 are in final stages of planning and 34 are in the early stages of planning - none of these in the United States. While the U.S. only gets some 20% of its electricity form NPPs, France gets 75%, Lithuania - 73%, Belgium - 58%, Sweden - 47%, Ukraine - 44%, South Korea - 43%, and the only country in the world to have suffered the effects of nuclear bombing, Japan - 36%.

Addressing the “significant” accidents involving NPPs, McCarthy (Ref. 18) reports the following:

Chernobyl: 31 people died and about 20 square miles of land became uninhabitable for a long time - This isn’t a lot. {my emphasis} While fall-out will contribute to an increase of cancers all over Europe, it’s unlikely that we will know how much because the increase will be very small in proportion to the total amount of cancer. Reasonable estimates put the number of fall-out induced cancer deaths in the tens or low hundreds, fewer than the deaths from the Bhopal chemical plant accident, and the Texas City explosion in 1947. Manufacture of Chernobyl type reactors was terminated by Russia in favor of safer NPP designs used in the rest of the world. Chernobyl remains the only nuclear power plant accident that has harmed the public

Three Mile Island: The reactor was destroyed but the core remained intact. Radioactive gases were vented but there is no accepted evidence that the public was harmed.

Japan: In 1999, Japanese technicians violated safety procedures in mixing up fuel at an experimental reactor, resulting in the deaths of two of the technicians. There was no danger to the public.

Based upon the thousands of operating years of experience with commercial and military nuclear power reactors, safety has proven to be better than with just any other power generation technology. Compared with deaths from: the mining of coal, exploring for and extracting oil and gas, transporting fossil fuels, as well as the cancers resulting from the pollution produced by fossil-based fuels, the nuclear power industry has done, and continues to do, exceedingly well.

As noted in Ref. 21, up to October 19, 2001, there have been more than 10,000 years of nuclear power plant operation. Significant accidents with NPPs can be counted on the fingers of one hand. Furthermore, “The U.S. Navy has been powering ships with nuclear reactors for 50 years and has had no nuclear accidents.” (Ref. 18) There is a clear message here - while there is no power producing technology that is 100% safe, with proper design, maintenance, training and operation, nuclear power generation can be (and has proven to be) extremely safe and many would argue that it has proven to be safer than power generated with hydrocarbon-fueled plants

A comment relative to nuclear power plants - McCarthy (Ref. 18) points out that while there is much optimism concerning the development of a “hydrogen economy” where the use of hydrocarbon based fuels will be replaced with hydrogen fuel, about the only known practical method for generating significant quantities of hydrogen is with nuclear energy.

For the past 2 to 3 decades, the United States has been held captive by anti-nuclear ideologues while several other nations in the world have moved out with their nuclear power programs. The fears and panic generated in the minds of the U.S. public by these anti-nuclear extremists has been a significant contributor to the continuing dependence of America on fossil fuels, increasingly of foreign origin, thereby rendering us dependent upon often hostile and unstable governments. Why is only 20% of the power generated in the U.S. provided by nuclear energy when France generates 75% and Japan 36%? Do France and Japan care less about safety and cost than the United States or are they just smarter than us in realizing the importance of energy independence?

NIMBY, Environmental Extremists and Negativists:    As previously noted, The Nantucket wind power project in federally controlled water continues to face opposition from the "Not In My Backyard" (NIMBY) crowd because of fears it would ruin their ocean view from the shore. Similarly, when it was suggested that an LNG terminal could be sited on an unused island outside of Boston’s inner harbor, the NIMBYs raised a hue and cry before any serious consideration of the pro’s and con’s had even started. Fall River’s mayor has promised to inflict a “thousand paper cuts” upon those audacious enough to suggest an LNG terminal for his city {meaning that he will produce an endless succession of court challenges in order to delay and increase the costs of the building of an LNG terminal}.

For many years now, America has been held hostage to environmentalists who have lobbied hard (and usually quite successfully) for their concept of what the world’s environment should be. In my view, the environmental extremists have been able to slow, limit and, in some cases, totally stop: the search for new energy sources, the extraction of fossil fuels in environmentally sensitive locales, and the generation of power from plants that they consider “not clean enough”.

The effects of succumbing to overzealous environmentalists were reported by Carol M. Cropper (Ref. 22) more than 10 years ago. Cropper reported that AES Corp., an independent power producer that specialized in coal-fired plants, used the latest technology to build clean coal-burning power plants. Coal-burning plants, using modern technology, are able to use the ample reserves of coal in the U.S. and take advantage of coal’s stable pricing. “But they don’t make the grade with U.S. environmental zealots, who regard the burning of coal as devil’s work.” AES was forced to walk away from started power plants and from plans for new plants in the U.S. because of objections by environmentalists. As a result, AES moved to build coal- oil- and gas-fired plants overseas where foreign nations were more sensible and balanced about integrating environmental and energy needs and less willing to listen to environmental extremists. AES moved to build and/or operate plants in Northern Ireland, England, India, China, Venezuela, Peru, and Pakistan. As an AES co-founder noted, “There is a much broader definition of quality of life [overseas] than just controlling SO2 emissions”

In an article by Gordon Shearer, in the October 8, 2005 Boston Herald (Ref. 23), we read that, “Our country is going to import increasing quantities of liquefied natural gas (LNG) to meet a growing shortfall in domestic production. Failure to do so will result in even higher prices and the risk of real shortages. Just as we need to add to our supplies of natural gas and other energy sources, we now realize we also need to consider the security and diversity of the facilities that we rely upon to deliver it to our workplaces and homes. Yet this is not happening.
   “Over the past three years, the federal government has approved 10 new LNG terminals, all but one in the Gulf of Mexico between New Orleans and Corpus Christi. The single terminal approved outside the gulf is proposed for Fall River. This terminal will bring high-paying jobs and a major stream of tax revenues to that city, but more importantly will increase our region’s gas supplies by almost 20 percent and will bring down the prices for everyone.
   “Knowing the negative economic impact of the ever increasing cost of energy in the region, the New England Governor Conference, the New England Council and ISO-New England have all identified the need to add LNG import capacity in this region to meet increasing demand and alleviate soaring prices.
   “While the Fall River project has been the subject of controversy on safety and security grounds, it has also been subjected to the most intensive review of an energy project ever carried out by the federal government’s safety and security agencies that, in turn, have found it to be both in the public interest and capable of safe and secure operations.
   “Yet many elected officials continue to oppose this project, as they do other energy projects – the wind farm in Nantucket Sound for example. While expressing outrage at the high cost of energy and demanding solutions, much of our political leadership opposes viable proposals that could be brought into service in a reasonable time frame. {my emphasis}    “We are faced with difficult choices and trade-offs in siting new energy and infrastructure, but the choice of doing nothing and opposing almost everything is a choice that will harm every citizen and business in the region by increasing our energy costs and reducing our economic competitiveness.”

While environmental concerns are real and need to be addressed, there are, unfortunately, some who rail against any efforts at making progress in solving our energy needs. Among these are those who fixate on past problems to claim that these problems cannot be overcome and therefore we cannot progress because these problems remain. I call them negativists. By their reasoning, the Exxon Valdez disaster proves that we should abandon searching for and developing new sources of petroleum - hence no new exploration in Alaska and no exploration off the Grand Banks fishing grounds. Never mind that some of the best fishing is to be found in the Gulf of Mexico where oil and gas drilling rigs abound. Never mind that lessons learned from the Exxon Valdez have been and continue to be applied to ensure that this type of accident is unlikely to ever occur again and, if it does, procedures have already been developed to mitigate the effects of a similar accident. If one were to accept the negativist position, development of the airplane would have stopped after the first fatal crash of a Wright brothers’ airplane, there would have been no automotive industry after the first fatal automobile accident, and no ships would have been built following the sinking of the Titanic. Fortunately the negativists in our midst form only a minuscule, albeit highly vocal, minority. Our politicians need to stop their pandering to the most vocal among us while our government leaders need to put the negativists’ objections in perspective and start the important work of developing solutions to the nation’s impending energy crisis.

Conservation and Efficiency:   In the early autumn of 2005, it was written (Ref. 24) that, “Americans [were] grumbling about gas prices hovering around $3 a gallon, but that price would be welcome in many other countries.” As of 10 October 2005, the cost of premium gas around the world was:  Belgium - $6.19;  France - $5.88;  Germany - $6.16;  Italy - $6.11;   Netherlands - $6.53;  U.K. - $6.26;  U.S. - $3.06.

   “Americans’ desire for cheap gasoline comes in a country that uses more than its share of the world’s fuel.    “The U.S. has less than 5 percent of the world’s population but consumes 20 million barrels of oil a day, about one-fourth of the global total {my emphasis} . . .”

While we are setting new records for how much oil we import, now more than 10 million barrels a day, other nations are catching up.

It has been said (Ref. 4), that, “Most experts agree that the surest way to reduce demand is to raise gas taxes, as Europe has done, but they also agree that Americans wouldn’t stand for it.” Well, Americans will have to stand for it or they will have to stand for a shortage of energy as was experienced during the Arab oil embargoes of the 1970’s.

If America is to meet its energy needs, at least in the near future, then the U.S. must get serious about energy conservation. One way to encourage, if not force, energy conservation, is to increase the cost of energy, gasoline in particular. Americans, as in most of the world, would then take the necessary steps themselves to reduce gasoline consumption. We would drive less, and buy more energy efficient vehicles. We would demand that such things as computer synchronized traffic signals be extensively introduced.

In a special issue of Scientific American (Ref. 15), the following points are made: “Improving end-use efficiency is the fastest and most lucrative way to save energy.” And “With the help of efficiency improvements and competitive renewable energy sources, the U.S. can phase out oil use by 2050.” In supporting these contentions, it is pointed out that, “The world abounds with proven ways to use energy more productively, and smart businesses are leaping to exploit them. Over the past decade, chemical manufacturer DuPont has boosted production nearly 30 percent but cut energy use 7 percent and greenhouse gas emissions 72 percent.” Most of these improvements are invisible to the average American since, “Most people lack the time and attention to learn about modern efficiency techniques, which evolve so quickly that even experts cannot keep up. … Although the U.S. government has declared that bolstering efficiency is a priority, this commitment is mostly rhetorical.”

As reported in Ref. 15, “MANY ENERGY-EFFICIENT PRODUCTS, once costly and exotic, are now inexpensive and commonplace. Electronic speed controls, for example, are mass-produced so cheaply that some suppliers give them away as a free bonus with each motor. Compact fluorescent lamps cost more than $20 two decades go but only $2 to $5 today; they use 75 to 80 percent less electricity than incandescent bulbs and last 10 to 13 times longer. Window coatings that transmit light but reflect heat cost one fourth of what they did five years ago.” As noted previously, technological progress is being made at a rapid pace and we can expect more and better energy-efficient products and techniques to reach the marketplace, particularly if supported or mandated by government policy.

With respect to vehicles, Lovins points out that, “Transportation consumes 70 percent of U.S. oil.” Further, “Despite 119 years of refinement, the modern car remains astonishingly inefficient. Only 13 percent of its fuel energy even reaches the wheels. … And, because 95 percent of the accelerated mass is the car itself, less than 1 percent of the fuel ends up moving the driver.
   “Yet the solution is obvious from the physics: greatly reduce the car’s weight, which causes three fourths of the energy losses at the wheels. … Concerns about cost and safety have long discouraged attempts to make lighter cars, but modern light-but-strong materials - new metal alloys and advanced polymer composites - can slash a car’s mass without sacrificing crashworthiness. For example, carbon-filament composites can absorb six to 12 times as much crash energy per kilogram as steel does.” As a further incentive to weight reduction, “… the first automaker to go ultralight will win the race to fuel cells.”

Another area where improved efficiency is already saving energy and reducing cost and where continuing additional improvements can be expected is that of light generation. At the end of October 2005, Scott Woolley (Ref. 25) wrote in Forbes magazine, “. . . light science offers the prospect of efficiency – millions of barrels of oil saved. Lighting gobbles 22% of the electricity used in this country and bulbs are, for the most part, horribly inefficient at converting electricity into visible wavelengths. Edison’s incandescent bulb runs at an efficiency of scarcely 2%.” or “. . . only 10 to 15 lumens of illumination.” Currently, “Fluorescents can do 50 to 100 lumens per watt, sodium vapor lamps as much as 180.”

Solid-state technology has introduced Light Emitting Diodes (LEDs) into a variety of products with varied uses. LEDs are now beginning to be used in applications that were once the sole province of incandescent and fluorescent light bulbs. “LEDs … are [now] up to 45 lumens per watt. The Department of Energy expects LEDs to reach 150 lumens in six years . . .” As a result, “Traffic lights in dozens of U.S. Cities have already swapped out regular bulbs for long-lasting LEDs. Quantas Airlines, the Australian carrier, has installed LED lighting in its first- and business-class cabins, … Wal-Mart now lights some of its freezers with LEDs, which run cooler than regular bulbs.”

Many other means of conserving energy are readily available and can be easily employed, if supported by the public and if encouraged by the government. A few examples are described by Ken Maguire (Ref. 26). He reports that a Boston area condominium developer is planning to stock its main fleet of cars “with a fleet of two-seat fuel-efficient cars that are just 8 feet long - and [make them] available on demand for residents.” He also reports that “in Dallas, an electric moped comes with each unit at … a planned 49 unit loft development.” Two hours of recharging will get 30 miles on the moped. The Dallas development is “a short walk to two rapid-rail stations, and will include wind power and water re-use.”

A Balanced Approach to Meeting America’s Energy Needs:    Caspar Weinberger, in Forbes (Ref. 6 ), wrote, “At the beginning of his first term President Bush stated the need for more reliable supplies of reasonably priced environmentally responsible energy to be produced domestically. For four long years Congress paid but scant attention to his call. The president quite properly reminded Congress in his State of the union address that our future economic growth will require far more energy production at home, including safe, clean nuclear energy. In order to jump-start our nuclear program, we will need to reduce the regulatory delays and hurdles that now stand in the path of any utility ready to invest in the long, costly effort required to build nuclear power plants.
   “The President cast his budget to encourage the use of alternate energy sources, such as hydrogen-fueled cars, cleaner coal and wind-generated power so we can decrease our dependence on foreign oil. We must develop these alternate energy sources to the fullest extent possible, but we must also develop new sources of domestic oil.”

While the protection of the environment requires careful consideration in any plan for solving the energy problem, it cannot remain the be-all and end-all. A realistic energy policy must be balanced. Environmental safety can be made a part of a meaningful energy plan. True, there can be no guarantee of absolute environmental safety, but what can be guaranteed is a careful consideration of environmental issues and an approach that balances all issues by addressing cost to benefit ratios. Alaska has not become a wasteland because of oil drilling in that state. The fishing industry in Alaska has not been destroyed by the Exxon Valdez oil spill. Indeed, as a result of the Exxon Valdez accident, modern tankers are now double-hulled. In a report from the Exxon Valdez Oil Spill Trustee Council (Ref. 7), we find the following: “As the years passed, it has become more difficult to distinguish the lingering effects of the Exxon Valdez spill from other potential sources of environmental stress or natural variations. Restoration projects for impacts that can be directly attributed to the Spill have been largely completed. Most of the results anticipated in the original settlement have been achieved.”

The lack of a comprehensive and balanced energy policy in the United States has been well summarized in the May 2005 issue of MIT’s Technology Review (Ref. 27). We read, “Alternative energy technologies are increasingly effective - in terms of both technological soundness and economic competitiveness - and may soon mitigate some of the myriad geopolitical, health, and environmental problems rooted in our dependence on fossil fuels. Modern nuclear power plant designs reflect lessons learned from 50 years of reactor operation and could benefit from materials and control systems unavailable in the 1960s and 1970s. Wind turbines and, to a lesser extent, photovoltaics - solar cells that convert sunlight directly into electricity - are on the verge of competing more broadly against conventional sources of energy. Other technologies, like fuel cells, require more research but hold great promise.
   “All of the above, however, suffer from official neglect in the United States, which lacks a consistent national policy aimed at bringing alternative energy technologies into common use.” {my emphasis} Furthermore, “… the United States lacks a consistent long-term plan to give renewables a more secure footing through initiatives like federal financing, tax credits, grid-connection mandates, and streamlined construction rules. This is too bad, because some of these technologies are ready for commercialization. Wind turbines, in particular, are efficient and reliable enough to compete against fossil fuels in some areas. … Wind technology is ready to expand and with some federal help could do so quickly.”

   “As for nuclear power, in the United States, innovative technologies languish, while overseas, plans to build new commercial plants are gathering momentum. … while one utility in the Carolinas talks about perhaps building an unspecified type of new nuclear plant some day in the future {my emphasis}, companies in South Africa and China recently signed an agreement to collaborate on building two versions of the innovative ‘pebble bed’ reactor. … nuclear power plants don’t produce any greenhouse gases and are viewed by some experts as the best technology for producing the hydrogen we’d need to realize a ‘hydrogen economy.’ But when we talk about nuclear power in the United States, it’s mainly to continue the endless arguments about where to put radioactive waste.” {my emphasis} (Ref. 27)

Also from Ref. 27, note the following: “…in March, legislators passed a bill that promotes the adoption of renewable electricity technologies. It includes a national fund to help pay for initial development, favorable lending and tax rates, and a requirement that electrical-grid operators adapt to renewable sources. Trouble is, the bill passed in China’s National People’s Congress. On Capital hill, an energy bill has been stalled for years, bogged down by controversial provisions …” While there is beginning to be some encouraging developments in the government, “they are not a comprehensive strategy.”

As Charles Krauthammer has pointed out (Ref. 28) in addressing the government’s reaction to the rise in gasoline prices after hurricanes Katrina and Rita, “…the Senate is attacking the problem by hauling oil executives to hearings on ‘price gauging.’ Even by Senate standards, the cynicism here is breathtaking. Everyone knows what the problem really is. It’s Economics 101: increasing demand and tight supply.” {my emphasis}

Krauthammer then goes on to say, “Yet for three decades we have dome criminally little about it. Conservatives argued for more production, liberals argued for more conservation, and each side blocked the other’s remedies - when even a child can see that we need both:” With respect to demand, Krauthammer proposes that the United States should lock in high prices for gasoline (more than $3 per gallon) in order to reduce demand and he points out that the higher fuel prices of the early 1970s and 1980s led to “more energy-efficient cars and appliances - which so restrained demand that the world price of oil fell though the floor. By 1986, oil was $11 a barrel. Then we resumed our old habits, and oil is now $60.” Also, the strategy of keeping gasoline prices high (and thereby reducing demand) “obviates the waste and folly of bureaucrats telling auto companies what cars in which fleets need to meet what arbitrary standards of fuel efficiency. Let the market decide. {my emphasis} Within weeks of Katrina, SUV sales were already in decline and hybrids were flying off the lots.”

To address the supply side of the issue, Krauthammer writes:

   “For decades we’ve been dithering over drilling in a tiny part of the Arctic National Wildlife Refuge [ANWR]. Dire predictions about the devastation that Prudhoe Bay oil development would visit upon the caribou proved false. Let’s get serious. {my emphasis} We live in perpetual vulnerability to oil blackmail. We have soldiers dying in the oil fields of the Middle East, yet we leave untouched the largest untapped oil field in North America so that the Lower-48ers can enjoy an image of pristine Arctic purity. This indulgence borders on decadence. {my emphasis}
   “As is our refusal to drill on the continental shelf. Off-shore drilling technology is far safer and more efficient than it was decades ago when this ban was passed.
   “The same logic applies to refineries. We have not built one since 1976. The U.S. refining industry operates at 96 percent capacity. That is unsustainable. We need the equivalent of the military base closing commission. A refinery commission that would situate 15 new refineries (some perhaps on Army base scheduled for closing) would spread the pain.
   “With these steps, we could within a decade escape the oil noose. But don’t hold your breath. The Senate loved its oil-exec inquisition. The House Wednesday stripped out the ANWR drilling provision. And there is not one national pol who dares propose raising gas taxes. We are criminally unserious about oil independence and we will pay the price.” {my emphasis}

Even the Boston Sunday Globe (Ref. 29), a very liberal leaning newspaper, excoriated Congress for its demagoguery in unfairly blasting big oil’s supposed gluttony and demanding that it be punished for its “infuriating’ windfall profits. The Globe notes that while ExxonMobile reported [a record high] $9.9 billion in profits last quarter,” big oil “will pour an estimated $86 billion into [developing] new technology and [increasing] production” this year. Putting a single offshore drilling platform online can cost more than $1 billion. The oil industry is inherently risky. Sometimes huge drilling investments result only in dry wells. The industry also faces uncertainty in the price of its product -last month, the price of crude skyrocketed to $70 a barrel, a month later it was below $60, and sometimes it drops to $10. Sometimes profits are healthy and sometimes there are no profits.

One cannot judge whether profits are “obscene” by the amount of profits. Large well-run companies make larger profits than small well run companies. To put the oil company’s profits into perspective, a more relevant measure of “price gouging” is the percentage of revenues that these profits represent, e.g., whether a company earns 10¢ per dollar of sales or 1¢. In the third quarter of 2005, Exxon earned 9.8 cents for every dollar of sales, Shell - 7.8 cents, Chevron - 6.6 cents and BP - 4.6 cents. In comparison, Coca-Cola earned 21.2 cents, Bank of America - 28.3 cents and Microsoft - 33.2 cents. Why didn’t Congress call for investigation of their “obscene” profits? Because that wouldn’t put our senators on television and they wouldn’t get their names on the 6 PM news or in the morning newspapers.

Giving tongue lashings to the heads of big oil may be good politics, but the real fact is that big oil as a whole only earned 7.7 cents per dollar of sales in the 2nd quarter of 2005 and that is 0.2 percent lower than the U.S. corporate average. Again, in comparison, the semiconductor industry earned 14.6 cents, pharmaceuticals - 18.6 cents, and banks -19.6 cents.

   “In fact, the real gas and oil profiteers weren’t represented by the CEOs getting grilled on Capitol Hill last week, but by the demagogues doing the grilling. Over the past 25 years, according to the Tax Foundation, oil companies paid state and federal income taxes of more than $2.2 trillion (in inflation-adjusted dollars). During the same period, the companies’ profits totaled $630 billion - less than a third of the government’s take {my emphasis}. Government revenue from gasoline taxes alone has exceeded oil industry profits in 22 of the past 25 years.” (Ref. 29)

The message seems to be clear. We face an energy crisis but we continue to fail to produce a realistic energy policy. There is no leadership at the federal level to address the problem. Our politicians pay lip service to solving the problem but they are more interested in pandering to parochial constituencies than in providing the leadership needed to work our way out of this dilemma. Washington continues to fiddle while the nation burns.

Imagine the results that would be speedily achieved with a government energy program similar to the Manhattan Project or the Apollo Moon program. We need a president willing to make the commitment to eliminate the energy dilemma in the same way that President Kennedy did when, in 1960, he made a national commitment to reach the moon in a decade. We also need a congress that will support the president and provide the money and the legislation to implement the policy. We need to have the Democrats and the Republicans focus on addressing the energy dilemma instead of focusing on attacking each other. Finally, we need a program manger in the mold of General Leslie Grove (who headed the Manhattan Project that developed the atom bomb during World War II) to direct the energy independence program.

In order to address the combined problems of increasing global energy demand, diminishing supplies of petroleum and natural gas, environmental concerns, economics, safety, etc., a comprehensive, integrated and aggressive energy policy needs to be produced now and the resultant energy program needs to start immediately thereafter. This program cannot be piecemeal and partial. No one simple approach will suffice. The executive and legislative branches of the government must stop playing politics and the American people must demand that both branches take the problem seriously and work together to eliminate the problem. The solution to the dilemma will not be achieved overnight. The American public must also be willing to make some sacrifices along the way. The effort will take decades. A few suggestions for this program needs include:

• Stepped up exploration for new sources of oil and gas
• Expedited approval processes to search for and extract oil and gas in environmentally sensitive areas
• Expedited permitting of LNG terminals, oil refineries, coal gasification plants, etc.
• Expedited permitting of natural gas distribution lines
• Increased use of coal (gasification, removal of pollutants, etc.)
• Building new and safer nuclear power generating plants
• Continued strict enforcement of environmental and safety requirements
• Continued development of solar energy conversion systems
• Expanded use of wind power generators
• Expedited development of hydrogen technology
• Reduction in gasoline consumption by the development of more efficient motor vehicles
• Encouraging/mandating the development and production of safe but lighter-weight vehicles
• Encouraging/mandating the increased use of hybrid and/or alternate fuel burning vehicles (ethanol, propane, etc.)
• Imposing financial penalties for the use of or the outright banning of gasoline inefficient vehicles
• Taxing of inefficient vehicles
• Increasing the gasoline tax
• Mandated or financially encouraged energy conservation and energy efficient products and processes
• Computerizing and coordinating traffic signals
• Turning off non-essential illumination at night in buildings, on advertising signs, etc.
• Improving mass transit and encouraging or mandating its use in place of automobiles where appropriate.
• Replacing incandescent lighting with fluorescent or solid state illumination.