Pro Poverty and Anti-Environment

It doesn’t really surprise me that the environmental lobby thinks ruinous gasoline prices are good, or that Democrats are determined to keep them in the stratosphere. It does surprise me that supposedly intelligent people can’t see how fundamentally self destructive their ideas are. It should be obvious from even a casual glance around the world that poverty is not environmentally friendly. Take a drive east from El Paso on I10 and look south across the border, then talk to me about pristine landscapes. It’s no coincidence the most economically depressed parts of the planet are also the dirtiest. The air in Mexico City is about as bad as it gets but the average citizen there is more worried about bringing home a paycheck. It takes money for us to clean up after ourselves. That takes a thriving economy. That takes cheap, readily available transportation, and for the foreseeable future that takes fossil fuels.

We can move away from them over time. We can go to carbon free electricity and hydrogen powered vehicles. We can build more and better public transport, and reorganize our population settlement patterns around it. But it will take time and money. If we begin by bankrupting much of our own society and halting progress of the teeming third world masses the money won’t be there and time won’t matter. That’s what these folks are trying to do. Extraordinarily high fuel prices have debilitating effects on all sorts of activity, the sorts that have brought us the greatest prosperity the world has ever seen. They have a depressing effect on domestic and international trade, driving the cost of goods and services ever higher. Unemployment will rise, deficits will soar, and governments will be forced to inflate currency to pay debt service. Investing in new, cleaner technologies could be quickly out of the question. Permanently high fuel prices are bad all around.

It’s not going to happen. A new president and congress next year won’t survive a wrecked economy. Even if wrong headed American elitists get the upper hand in fall elections, most of the world will refuse to follow their lead. Europeans may worry about global warming but they will not pay the cost of currently available options to seriously reduce carbon dioxide emissions. The Chinese and Indians are going to get their automobiles and they are going to power them with inexpensive fossil fuels, no matter how much the chardonnay and tofu crowd fret about it.

There are inexpensive and comparatively clean options available. Off shore drilling is preferable to foreign imports not only for national security reasons, but because oil spills are more likely from super tanker accidents than from drilling rigs. Coal to liquid, shale oil extraction, and alga-culture technologies are all ready, or near ready, for commercial production at reasonable costs. All are carbon based but all can be cleaner than current petroleum processes. When push comes to shove, and I believe that time has come, no amount of environmentalist screaming will stand in the way of their development. Environmental extremists are not going to drag us back into the Stone Age.

A firestorm is brewing and a lot of politicians are going to be ducking for cover this summer. $4 dollar gasoline is eclipsing other issues. People are concerned about it, more concerned than they are about the war in Iraq. As Republicans get their teeth into it they are going to have a field day. I’m disappointed there hasn’t been more of a flap over Senator Obama’s asinine comment about his preference for a more gradual rise but as a friend pointed out, maybe it’s better if the flap develops gradually.

Just Say No

Ask Palestinians what you get for always saying no to everything; nothing. Yet that is exactly what environmental extremists have been doing for the past quarter century or so. They’ve said no and thrown up disinformation and political roadblocks to every potential source of US energy independence, and to the only viable source of carbon free electricity. Now it’s too late. They’ve let things get out of hand. I predict they will shortly be run over by a steam roller of public outrage. The battle is joined in earnest, people are beginning to pay close attention, and they are not long going to listen to the voices of people who are out to abolish the internal combustion engine, who would see an end to the industrial revolution, and who are apparently willing to see much of the world reduced to a subsistence existence in the process. Ordinary people are not going to sit still for ruinous fuel prices when there are numerous alternatives at hand.

Democrats have been listening to this drivel for so long they don’t even see the problem with gasoline at $4 per gallon. Barack Obama sees no controversy in it. He just would have preferred a more gradual rise. He didn’t see anything controversial about his church either and if he didn’t see the Reverend Wright debacle coming he isn’t going to know what hit him when people realize what he meant. He meant that a prohibitively high fuel price is a good thing because it will force people away from gas guzzlers. He apparently doesn’t realize it isn’t just Humvee owners who are affected. Everybody is affected and most of us aren’t driving Humvees. Even those who would consider trading their SUV in for a Prius have seen the value of the old car drop like a rock and the price of a hybrid skyrocket. There are a lot of people who can’t afford that.

It isn’t as though we can all just cut back on our driving. Many of us depend on our vehicles for a livelihood. More people will take public transportation but the infrastructure isn’t there to support a sudden large increase in ridership. What about all the people who have no alternative? We can’t all move closer to work. The housing isn’t there. What about taxi drivers, truck drivers, deliverymen, and all the other commercial vehicle operators? Do they just jack up their prices? They may be out of business.

Speaking of higher prices, people haven’t thought this through despite warnings from food riots around the world. There’ve been no riots here, not yet, but people are cutting back on food budgets. They’re eating out less often and eating less healthy. They’re cutting back on vacation plans too. People who never used to budget for the gasoline on a family outing are doing the numbers now. That may be good news for gasoline consumption but the travel industry is looking at a pretty bleak season. The ripple effect is just getting started.

Most of us want to be environmentally responsible but to ignore the supply side of our transportation needs is insanity. We are the only oil producing nation in the world that severely restricts new exploration and extraction. We are sitting on reserves of fossil fuels that would last us several centuries if we would just use them. We can and should eventually move away from carbon based fuels but for the foreseeable future there are no realistic alternatives. In pretending that there are the environmental lobby is losing all credibility, and the right to a place at the table as we decide the way forward. It’s a shame. We could have drilled in ANWAR years ago, taken reasonable precautions to avoid harming the caribou, and used the royalties to clean up the Chesapeake, maybe the dead zone at the mouth of the Mississippi to boot.

Irresponsibly Green

Not everybody is complaining about high gasoline prices. The green lobby sees in them an opportunity to discourage use of the automobile. Barack Obama would have preferred a more gradual rise but is apparently content to see them continue going up. His plan is restricted to higher CAFÉ requirements (CAFÉ is the federally mandated mileage standard imposed on auto manufacturers), greater use of ethanol and bio-diesel, and new taxes on oil companies. His model is Brazil’s sugar cane ethanol. John McCain offers no more than a temporary gas tax holiday and a halt to filling the strategic petroleum reserve. If he has a long term solution I don’t see it on his web site.

What this suggests to me is that the current upward spiral in prices is at least in part the result of deliberate government policy. Most Democrats, some Republicans, and many in the media have gone along with it. It doesn’t have to be this way. Most of us would like to be responsible stewards of the planet but there are domestic sources of fuel available at reasonable costs that do not necessarily damage the environment or interfere with our ability to feed ourselves. I can think of at least four: undeveloped oil and gas reserves, oil shale, coal, and the potentially inexhaustible renewable resource, alga-culture. Any one or a combination of these has the potential to reduce our dependence on foreign oil, or eliminate it entirely. All of them can be produced as cleanly as or more cleanly than petroleum. Self proclaimed environmentalist object to them all. Some of their concerns are legitimate. Some are red herrings. All of them can be addressed. Some require reasonable compromises but these are not reasonable people. They will object to any alternative that prolongs the life of the internal combustion engine.

So we have huge reserves of oil and gas offshore and in the arctic left unexplored and untapped. No measure to reduce the surface footprint or risk in drilling is enough. We have more oil in shale rock alone than Saudi Arabia has petroleum. Royal Dutch Shell has what they believe is an environmentally friendly process to extract it at a cost of about $30 per barrel. Last month with gasoline approaching $4 per gallon the U. S. Senate Appropriations Committee voted 15:14 along party lines to prevent them building a plant to prove it. We have enough coal to last us three hundred years. We know how to cleanse it of pollutants and convert it to liquid fuel at a cost less than half that of oil at current prices. Potential investors are reluctant to build commercial refineries in no small part because of perceived legislative risks. Scientists say alga-culture has the potential to satisfy the entire world’s appetite for liquid fuels, can use animal, agricultural, or municipal waste as feedstock, does not require arable land or fresh water, and leaves a byproduct that can be used as food supplements for people and animals. The Department of Energy shut down its one research program into alga-culture in 1996.

Our economic prosperity depends on the various modes of transportation that are affected by oil prices, and they are mostly dependent on internal combustion. There are alternatives to imported oil but for the foreseeable future there are no alternatives to hydrocarbons, not in transportation anyway. All-electric or hydrogen powered vehicles are things of the distant future if they are ever to be. We need transportation now and that means we need carbon based fuel. China, India, and every third world nation all need it if their people are ever to enjoy the life styles they aspire to. Environmental theists must not be allowed to continue dictating public policy. We have to make our decisions not only for the benefit of the planet, but for the benefit of those who live on it as well.

What are we Waiting For?

I sent versions of this letter to:
US Sen. Kay Bailey Hutchison
US Sen. John Cornyn
US Rep. Sam Johnson
Texas Gov. Rick Perry
Texas Lt. Gov. David Dewhurst
Texas Sen. Florence Shapiro
Texas Rep. Jerry Madden

June 9, 2008

Representative Jerry Madden

520 E. Central Parkway
Suite 236
P.O. Box 940844
Plano, TX 75074

Dear Representative Madden,

I would like to encourage you to support expedited action toward independence from foreign oil. I’m sure I don’t have to point out how damaging current high prices for transportation fuels are. I am disappointed however in the progress we are making toward doing something about it. There are some things we could be doing in our state.

My understanding from reading Department of Energy reports and other materials is that there are readily available and environmentally friendly technologies that could produce alternative fuels on a commercial scale, at reasonable costs, and soon. Some of these alternatives have been around for some time, yet we seem to be bogged down in partisan squabbling, special interest lobbying, and never ending debate. With prices spiraling upwards it’s long past time for decisive action.

Clean coal-to-liquid technology in particular would seem an appropriate vehicle for Texas. We have a lot of medium to low grade lignite that in new refineries can be converted to gas, cleansed of its pollutants, and used to produce relatively clean burning gasoline, diesel, and aviation fuels at costs comparable to oil at $55 per barrel. The resulting carbon dioxide can be captured and uses found for it. These plants can be built on or near existing mines, avoiding much of the transportation cost commonly associated with coal. They could produce thousands of new jobs for Texans and help stabilize fuel prices at much lower levels than they are today.

I would like to see this become a serious issue in this year’s election campaigns. There are other energy issues too, and other proposals for short term help in a short term crisis. This is a long term solution to a long term problem. It’s something we can do now. These facilities can be on stream in five years or less.

Let me reiterate. Coal is an abundant resource. We know how to convert it to liquid fuels at net benefits to the environment, the economy, and national security. What are we waiting for?

Thank you for your consideration of this matter.

Respectfully,

/s/

What’s Wrong with Coal

We own immense quantities of readily accessible coal we can refine profitably into liquid fuels at less than half the cost of comparable petroleum based products. Yet some environmentalists object on grounds it’s too dirty, and potential investors say it’s too risky. Neither argument is valid. I’ll try to address both complaints.

The most common environmental objections have to do with air pollution and the damage done by strip mining. The latter is a legitimate issue but the contention that coal is necessarily more polluting than petroleum is demonstrably false. Those who make it are either poorly informed or, I suspect, raise it as a red herring because lower fuel prices encourage continued us of the automobile. In technologies currently being proposed coal is cleansed of impurities before it is ever burned. Not so with conventional fuels. Coal based diesel even has positive effects on engine performance, no modifications required. It is reasonable to be cautious in proceeding on the scale that would be required to significantly reduce our dependence on foreign imports. It is irresponsible to dismiss out-of-hand a technology that has the potential both to eliminate that dependence entirely and to have profoundly beneficial effects on our economy.

That brings me to mining. Strip mines are ugly. Keeping the countryside pristine in say Appalachia is an understandable sentiment, if not always a practical one. It may be true that mountains have been flattened and hardwood forests razed in West Virginia but it is also true there is a lot of blight in the region due to its relative poverty. Forests can be replanted and land reclaimed, put to all sorts of good uses including as parks and recreational facilities. If thousands of well paying jobs can be created in parts of the country that need them, an increase in strip mining operations might be well worth the price. Increasing prosperity brings us both the desire and the wherewithal to clean up after ourselves. In any case we aren’t talking about turning the nation into an eyesore. Most of the coal we need can be gotten from existing mines. It will be many years before those resources are exhausted and in that time, if we do this right, new technologies will be available to present even better options than coal. The important thing to remember is that we need the stuff. The world will continue to increase its use of the automobile for the foreseeable future and we have to find fuel somewhere. We should be asking how we get it, not whether. Conservation and improved mileage can only take us so far.

As to economic risks associated with building expensive new coal refineries, the one most often cited is the uncertainty of future legislation regarding CO2 emissions. Congress may enact mandatory caps on carbon dioxide and require the addition of sequestration equipment. But that applies only to conventional coal plants. Coal to liquid technology under discussion includes built in CO2 capture. The projects make economic sense with oil prices far below where they are now, and it’s a safe bet oil can’t meet rising demand at lower prices. I don’t see an unreasonable risk. I wonder if powerful industry interests aren’t trying to protect sunk investments in old infrastructure. I can see why they might. They’ve successfully resisted cleanup efforts for many years now on the grounds increased costs mean fewer jobs. If the public begins to see an economic boom in clean coal, that argument may lose its luster. In any case the more immediate threat to the smokestack industry isn’t clean coal, it’s alternatives like nuclear, wind, and soar.

Economic factors argue for coal, not against it. So do the environmentals. This is too important to let it get bogged down in disinformation. Let’s get a move on.

Getting Off the Energy Dime

The Energy Information Agency says US net oil imports for 2006 averaged 12.39 million barrels per day. By my calculations, at yesterday’s spot price of roughly $127.50 per barrel, a similar amount this year will cost us a staggering $1.58 billion per day, every day. That’s more that half a trillion bucks per year, amounting to more than 70% of the trade deficit for last year. Let’s stop doing that. Let’s set some national goals that will have us self sufficient in transportation fuels and other petroleum products by, say 2020. While we’re at it let’s plan to generate at least half our electricity from non-carbon based sources. Let’s cut current inflation adjusted energy prices by half or more. We can do it at phenomenal net benefits to our economy and we can take some serious steps to clean up the air in the process. It will require major investments in money and effort but the returns should more than justify them.

We can do all of this with increased emphasis on nuclear, wind, and solar power for electricity, and clean coal and alga culture processes for liquid fuels. The technology is available and engineers say they can build the necessary facilities at competitive costs, though wind and solar rely on subsidies to do it.

Nuclear power currently accounts for about 19.4% of US electricity. I’m guessing we could more than double that in 12 years if we put our minds to it. The Department of Energy has already announced a 6% goal from wind by 2020, and 20% by 2030. It’s a goal that should be accelerated based on current trends. Solar power has been lagging a bit behind but costs and capacity have been improving rapidly in recent years. One problem with all three sources is that the bests sites are remote from major population centers but with improvements in high voltage direct current technology the problems in transporting electricity over hundreds of miles, including under ground and under water, are a lot less daunting than they were a few years ago. These amount to big increases in electrical generating capacity. As new plants come on stream we could shut down older, dirtier coal plants and divert natural gas to home heating applications where it works best.

As for liquid fuels for transportation, we’ve been focused on the wrong technologies with corn and soy based biofuels that don’t have the potential to meet the need. Coal and algae do but 12 million barrels a day is a lot of oil and replacing it will require a gargantuan ramp up in production capacity. Just getting started could have enormous ramifications. Exxon alone expects to spend $21 billion this year on oil exploration and refinery expansion. That’s money that could build a lot of algae farms and coal gasification plants. If the big oil companies begin to see a future reduction in petroleum demand, they just might divert some of those dollars. Maybe some of our elected representatives could think of some incentives to help them to that conclusion. Exxon has been resisting the idea but most of the others are at least making tentative investments in alternative fuels. A change in their return on investment calculations could turn that into a flood.

It will need it. The National Mining Association puts the cost to build a coal-to-liquid refinery at about $600 million to $700 million and a lead time of five to seven years to produce 10,000 barrels per day, less than one tenth of one percent of the capacity required. The numbers get a little better with increased scale but the required investment would be many billions every year to get anywhere near my goal. It’s a lot of money but it’s nothing compared to the cost of imported oil.