By Paul Roberts
09-07-04
It should be clear by now, even to those in the White House, that America
needs a new oil strategy.
Since 1980, US oil policy has centred almost entirely on enlarging our supply of
oil -- either by drilling more oil wells at home or by cosying up to foreign
producers such as Nigeria or Saudi Arabia. But as a means to energy security,
this plan is dangerously obsolete. US oil fields are nearly tapped out. Most of
our oil allies are so unstable that supply disruptions -- and price spikes --
will become routine.
More to the point, oil is a finite resource. Today's high prices have less to do
with turmoil in Iraq than with the fact that oil companies can't find new oil as
fast as the United States, China and other booming economies are using it -- and
this trend isn't likely to change. The United States uses about 20 mm bpd of
oil; the world, about 80 mm barrels.
In short, America can no longer afford the fiction that we still control our
oil supply. Instead, we must refocus on the one area where we do have control:
demand. Specifically, we need to find ways to use dramatically less oil,
especially in our transportation fleet, where two-thirds of all US oil use
occurs.
To succeed, we would need to commit to a long-term, broad-based and expensive
research-and-development effort. America could not only lower its reliance on an
increasingly unstable oil economy, but also help start a global transition away
from oil that even oil companies see as inevitable.
How do we move beyond oil?
Many commentators -- and the White House -- see hydrogen as oil's most likely
successor. Yet by most realistic forecasts, it will be decades before we can
roll out a fleet of cost-effective hydrogen-powered vehicles and a fuelling
system.
In the meantime, America shouldn't be distracted from a host of energy options
that could begin reducing our need for conventional oil -- and oil imports --
right now.
The most obvious first step is a radical improvement in automotive fuel
efficiency. Although the United States has given back all of the dramatic
efficiency gains achieved after the Arab oil embargo 30 years ago, it wouldn't
be hard to recover. Automakers already have the technology to double miles per
gallon, and if the surging popularity of hybrids is any sign, consumers may be
ready for a new concept in cars.
Detroit, of course, will resist. US automakers fear the high costs of retooling;
indeed, some commentators (myself included) believe only a massive federal
bailout will get auto companies to shift gears. But the benefits would be huge.
By doubling the average fuel economy of cars and trucks to 40 miles per gallon
(which existing hybrid technology could do), we could save 5 mm bpd of oil by
2015 -- or more than twice our current imports from the Middle East.
The second way to cut our use of oil is to find other fuels. Here, too, the
news is encouraging. Today, most new cars can already burn ethanol, an alcohol
brewed from corn. True, corn is far too expensive as a raw material (which is
why our ethanol industry survives only due to massive federal subsidies) and has
been criticized in part for not being efficient. But ethanol will soon be made
from new, inexpensive crops, such as switch grass, specially bred to yield large
volumes of cheap fuel.
With an adequately funded crash development program, the United States could be
making enough ethanol by 2008 to replace 700,000 bpd of oil. By 2020, ethanol
and other "bio-fuels" could supply one-fifth of America's
transportation fuel, displacing about 3 mm bpd.
Thus, between efficiency and bio-fuels, America might be able to displace as
much as 8 mm bpd of oil by 2020, or nearly one-third of the 26 mm barrels of oil
forecasters say we would otherwise be using by then. The global ramifications
would be staggering. As the world's biggest oil customer began using less, the
price of oil -- and with it, the political power of OPEC and other producers --
would drop steadily.
These are, admittedly, somewhat optimistic scenarios. It's possible, for
example, that hybrid cars might never gain wide market penetration, or that
ethanol production might hit some unforeseen snag that would keep the price too
high.
But what is just as likely is that by then, the United States could have
uncovered a clever new way to displace oil. For example, oil companies are
already refining synthetic oil from massive deposits of tar sands in the
Canadian province of Alberta. Likewise, coal, which the United States has in
abundance, can be refined into liquid fuels. True, both processes release
massive amounts of climate-altering carbon dioxide. But assuming we can find a
cost-effective way to capture that carbon dioxide, the United States could
displace even more imported oil.
The point is that the United States has alternatives to an energy system
dominated by a fuel that carries growing political and environmental risks. But
US energy options can't be realized without a serious national commitment -- and
an acknowledgment that our current supply-side oil strategy is less a strategy
than a eulogy.
Paul Roberts is the author of "The End of Oil: On the Edge of a Perilous
New World" (2004).
Source: Salt Lake Tribune