Natural Gas Is Our Best Hope for Energy Independence

From Charles Hugh Smith at the OfTwoMinds.com blog, here's a report from Ray W., an energy consultant. It offers some hope that the United States can overcome its oil addiction, with smart planning and effective leadership. Can we do it? Time will tell.

I try to understand the key dynamics of the energy marketplace because I believe that we have reached peak oil and the modern countries are so dependent on fossils fuels. The report below seems to be very objective.

I worry that the Saudis and big oil companies have so much influence in our government that our energy policy will remain the same, until we run out of money.

Of the three main fossil fuels, natural gas is uniquely situated.

Oil is nearing peak production. To find new reserves, companies such as BP, Shell, and ExxonMobil venture into ever more hostile environments, both physical and political, spend ever higher amounts of money, and take ever greater risks. Deepwater Horizon, the oil platform that detonated and sank in the Gulf of Mexico and spewed four million barrels of crude into one of the world’s most productive fisheries, is a tame example.

For real expense and environmental risk, look at the tar sands in Canada; for political risk, look at the Niger Delta. The increasing cost of oil exploration and production will consume a larger share of GDP, just as health care does, and if we continue to expand our dependency on oil, we will continue to erode the standard of living for all but the very wealthy. The trajectory of the price of oil is structurally upward.

Coal is simply nasty. It’s advantage: it’s plentiful and therefore cheap. Otherwise, it’s a supremely destructive substance at all stages of its exploitation, from mining to transport to combustion to ash disposal.

Natural gas is far more plentiful than oil and far less environmentally destructive than coal.

Gas produces about 40% of the carbon dioxide of coal for the same kilowatt-hour of power generation. It leaves no solid waste at all, unlike coal, which leaves tremendous piles of ash that must be disposed of and that are susceptible to environmental catastrophe. The Kingston spill in 2008 deposited 5.4 million cubic yards (about four times the debris of the World Trade Centers) in the Emory and Clinch Rivers in Tennessee.

Gas contains no mercury, lead, arsenic, or other heavy metals as does coal. At pipeline quality, its combustion produces no sulfur dioxide (the main cause of acid rain) and far less nitrous oxide (the main cause of smog) than coal.

Gas is transported by pipeline, which is extremely efficient. Pipelines, being underground, are also visually and logistically unobtrusive and, despite the recent tragedy in San Bruno, California, generally safe. Far more people have been killed in coal-related accidents, not to mention aviation or automobile accidents, than have been in gas-related accidents.

Now we come to extraction, where things get more complicated.

In the past three years, the amount of natural gas produced in this country has increased 16%, from 18 to 21 trillion cubic feet. This is attributable to recent rapid advances in two drilling techniques: horizontal drilling and hydraulic fracturing. The high price of gas earlier in the decade spurred the development of these technologies, which extract gas from solid rock, rather than from conventional pooled deposits.

Extraction presents some serious environmental issues. Some gas deposits contain a fair amount of sulfur, which must be removed and disposed of. Most extracted sulfur is made into sulfuric acid for industrial purposes. Other deposits contain carbon dioxide in quantities as much as 12 percent by volume, which reduces the resource’s greenhouse gas advantage. And it takes a great deal of energy to drill for gas. The rigs generally run on diesel. The recently developed techniques for extracting gas from shale formations also consume large amounts of water. That said, gas extraction doesn’t use nearly the amount of energy or water as coal mine excavation.

Water will be the limiting factor for expanding gas production in the United States. Some shale gas producers have been working diligently to find environmentally acceptable ways to minimize the use of water, mostly through reuse. In shale gas production, the water is injected under pressure to fracture the rock, which liberates the gas.

The injected water contains several chemicals to provide for the optimal viscosity to enhance fracturing while still being liquid enough to withdraw easily. Most producers use less than a dozen chemicals, which comprise 0.5 percent of the injection stream. The very high numbers of chemicals (approaching 600) quoted in the film "Gasland" are an amalgamation of all the chemicals ever used for fracturing across the industry.

Some producers are racing to gain first-mover advantage in the shale plays, which seem to pop up every three months. These producers tend to be less cautious than others, and this is how accidents happen. But there is nothing intrinsically more hazardous or risky about drilling for gas in shale formations than drilling for conventional gas, or drilling for oil, or mining for coal.

Gas-bearing shale tends to be several thousand feet (one to two miles) below the aquifer. There is virtually no way for the gas to migrate into the aquifer except through the vertical component of the well that penetrates the water table en route to the gas resource. Gas wells, like oil wells, are encased in cement to protect the surrounding ground from seepage. Sloppy procedures can result in bad cement jobs. But this risk is present for any gas or oil well; it is not particular to shale gas.

The United States can substantially reduce oil usage and coal usage and improve carbon dioxide emissions by increasing the production and consumption of natural gas. We can reduce carbon dioxide emissions by 20% within weeks, simply by switching about 15% of coal-fired electric generation to gas-fired, using existing spare capacity in the gas-fired fleet.

There is plenty of gas to make this happen without risking huge price run-ups. Gas prices on average might move up about $1.00 per MMBtu, from the $4.00-$5.00 range to the $5.00-$6.00 range. While this would be a 20-25% increase, other costs would go down, specifically the costs of coal-caused pollution. This does not consider the future value preserved by slowing climate change. Also, increased demand would spur increased production, which would moderate such price increases.

Eventually, gas use will have to be reduced if we are to avoid the worst of climate change. Increased gas use is a transitional strategy for the next 20-30 years, to provide time for renewable energy and efficiency technologies to be developed and deployed. However, even at that point, gas would still have a role. It is the logical fuel to use to complement the intermittent nature of renewable electric generation.

Technological improvements are likely in electric storage, but electric storage is unlikely to be economical enough to span all 24 hours of the day. Gas, delivered through pipelines, is an on-demand electric generation fuel, unlike coal or oil, and can respond instantaneously as minute-to-minute consumer demand and renewable generation fluctuate.

If we craft public policy to favor gas to displace coal and oil, we have to be careful not to grow complacent. Gas is not a panacea for climate change. It is still a fossil fuel. However, it is a readily available, pragmatic, interim solution as we move to renewables and efficiency over the next 20-30 years.

 

How US Leaders Have Failed

Ben Stein blasts the policies that have pushed the U.S. into this precarious economic position.

Link: How to Ruin the U.S. Economy by Ben Stein

1) Have a fiscal policy that creates immense deficits in good times and bad, burdening America’s posterity with staggering burdens of repaying the debt.

2) Eliminate regulation of Wall Street and/or fail to enforce the regulations that already exist, instead trusting Wall Street and other money managers and speculators to manage other people’s money with few or no regulations and little oversight.

3) Have an energy policy that disallows producing our own energy and instead requires that we buy energy from abroad, thus making our oil prices highly volatile and creating large balance of payments deficits, lowering the value of the dollar and thus making the problem get progressively worse.

4) Have Congress mandate that banks and other financial entities lend money to persons they know in advance to have poor credit ratings or none at all.

5) Allow investment banks, insurers, and banks to bet their entire net worth and then some on the premise that borrowers known to be improvident will in fact repay those loans.

6) Allow the creation of large betting pools called "hedge funds" that can move markets and control the outcome of trading, thus taking a forum for savings and retirement for families and making it into a rigged casino game that exists primarily to fleece suckers like ordinary working men and women.

7) Have laws that protect corporate officers from being sued for misconduct but at the same time punish lawyers in the private sector who ferret out such misconduct and try to make accountable the people responsible for shareholder and investor losses. If one of those lawyers gets particularly aggressive in protecting stockholders, put him in prison.

8) Appoint as head of the United States Treasury Department a man whose whole life was spent on Wall Street, who became fantastically rich through his peddling of junk bonds at his firm while the firm later sold short those same sorts of bonds.

9) Scare Americans into putting up $750 billion of their hard earned money to bail out the billionaires and their friends who created the market for loans to poor credit risks (The "subprime" market) and the unbelievably large side bets on those loans, promising that such a bailout would save the retirement savings of Americans, then allow the immense hedge funds to make the market crater immediately afterwards.

10) Propose to save the situation by surtaxing the oil industry, which is owned by our fellow Americans, mostly in their retirement plans, thus penalizing Americans for investing in companies that efficiently and legally produce an indispensable product.

11) Insist that the free market requires that banks and insurers with friends of the Secretary of the Treasury be saved but allow other entities not so fortunate to fail, thus creating total uncertainty and terror among financial institutions, and demolishing all of the confidence built up in financial circles since the days of FDR.

12) Then have the Republican candidate say he would keep on the job the Treasury Secretary who facilitated the crisis, failed to protect the nation from the crisis, got the taxpayers to pony up to save his Wall Street buddies, and have the Democratic candidate, as noted, say he would save the day by taxing the stockholders of energy companies.

There, that should do it.

U.S. Energy Policy: Stay Addicted

Thomas L. Friedman describes missed opportunities for leadership on energy policy.

Link: Op-Ed Columnist – 9/11 and 4/11 – Op-Ed – NYTimes.com.

President Bush is well on his way to being remembered as the leader who wasted not one but two crises: 9/11 and 4/11. The average price of gasoline in the U.S. last week, according to the Energy Information Administration, was $4.11.

After 9/11, Mr. Bush had the chance to summon the country to a great nation-building project focused on breaking our addiction to oil. Instead, he told us to go shopping. After gasoline prices hit $4.11 last week, he had the chance to summon the country to a great nation-building project focused on clean energy. Instead, he told us to go drilling.

Neither shopping nor drilling is the solution to our problems.

What doesn’t the Bush crowd get? It’s this: We don’t have a “gasoline price problem.” We have an addiction problem. We are addicted to dirty fossil fuels, and this addiction is driving a whole set of toxic trends that are harming our nation and world in many different ways. It is intensifying global warming, creating runaway global demand for oil and gas, weakening our currency by shifting huge amounts of dollars abroad to pay for oil imports, widening “energy poverty” across Africa, destroying plants and animals at record rates and fostering ever-stronger petro-dictatorships in Iran, Russia and Venezuela.

When a person is addicted to crack cocaine, his problem is not that the price of crack is going up. His problem is what that crack addiction is doing to his whole body. The cure is not cheaper crack, which would only perpetuate the addiction and all the problems it is creating. The cure is to break the addiction.

Ditto for us. Our cure is not cheaper gasoline, but a clean energy system. And the key to building that is to keep the price of gasoline and coal — our crack — higher, not lower, so consumers are moved to break their addiction to these dirty fuels and inventors are moved to create clean alternatives.

This moment — $4.11 — represents Bush’s last chance for a legacy. It amazes me how inadequate his response has been. By hectoring the nation to simply drill for more oil, he has profoundly underestimated the challenges we face, misread the scale of the solutions required, underappreciated the American people’s willingness to sacrifice if presented with a real plan, and ignored the greatness that would accrue to our country if we led the world in clean power.

Clean Coal is a Myth

Clean Coal is a nice image used by politicians to win votes in coal producing states. It exists only in the minds of hopeful politicians and marketers of coal and coal-burning plants. Excerpts from Ben Elgin’s article in Business Week magazine are below.

Link: The Dirty Truth About Clean Coal.

With coal-rich swing states such as Pennsylvania, Ohio, and West Virginia critical to the Presidential race, both Barack Obama and John McCain have endorsed the idea that coal is well on its way to becoming a benign energy source.

The catch is that for now—and for years to come—"clean coal" will
remain more a catchphrase than a reality. Despite the eagerness of the
coal and power industries to sanitize their image and the desire of
U.S. politicians to push a healthy-sounding alternative to expensive
foreign oil and natural gas, clean coal is still a misnomer.

Environmental legislation enacted in 1990 forced the operators of
coal-fired power plants to reduce pollutants that cause acid-rain. But
such plants, which provide half of U.S. electricity, are the country’s
biggest source of greenhouse-gas emissions linked to global warming. No
coal plant can control its emissions of heat-trapping carbon dioxide.

All the talk relates to the idea of separating CO2
from the coal-burning process and burying it in liquid form so it won’t
contribute to climate change.

Corporations and the federal government have tried for years to
accomplish "carbon capture and sequestration." So far they haven’t had
much luck. The method is widely viewed as being decades away from
commercial viability. Even then, the cost could be prohibitive: by a
conservative estimate, several trillion dollars to switch to clean coal
in the U.S. alone.

Then there are the safety questions. One large, coal-fired plant generates the equivalent of 3 billion barrels of CO2 over a 60-year lifetime. That would require a space the size of a major oil field to contain.

Companies seeking to build dozens of coal-fueled power plants across
the country use the term "clean coal" liberally in trying to persuade
regulators and voters. Power giant Dominion (D)
describes a proposed plant near St. Paul, Va., expected to generate
electricity by 2012, as having "the very latest in clean-coal
technology." What the unbuilt facility actually possesses to address
global warming is a plot of land set aside for CO2-removal
technology—once it is invented and becomes commercially feasible. The
plant design will accommodate the technology, says Jim Martin, a
Dominion vice-president. These steps, he says, "may actually spur more
research on carbon capture and sequestration."

The Presidential candidates will walk a fine line on the issue.
Senators Obama and McCain support legislation to address global
warming. But "coal is rich in some strategic states that are key to
winning the Presidency," notes Eric Burgeson, an energy lobbyist and
former McCain adviser.

In all, some 118 electoral votes are in play in the top 10
coal-producing states—44% of the 270 needed to win the election. That
likely will fuel plenty of speechifying.

Nuclear Energy’s Problems

Nuclear energy is not a viable solution for our energy needs for many reasons. The excerpts below from BusinessWeek.com below describe many of the drawbacks.

Opponents of solar and wind energy complain about government subsidies, but nuclear energy will require massive subsidies and government involvement.

Link: Nuclear’s Tangled Economics.

McCain laid out his vision for 100 new nuclear plants—45 of them to be built by 2030. They would help meet America’s energy needs, and because nukes don’t emit greenhouse gases, they would fight global warming as well. McCain also wants to borrow from the French playbook by reprocessing and reusing spent nuclear fuel and by providing government incentives to get all this done.

But McCain may not want to follow the French example too closely. While France’s
existing 59 atomic plants are relatively trouble-free, its largest nuclear
company, Areva, has run into difficulties building next-generation reactors in
France and Finland. The Finnish project is two years behind schedule and more
than $1.5 billion over budget, while construction of the other plant, in
Normandy, was temporarily halted in late May because of quality concerns. And
while France has the world’s biggest fuel-reprocessing program, it still hasn’t
found a permanent home for a growing pile of highly radioactive waste that’s
left over.

Two years ago, the price of a 1,500-megawatt reactor was pegged at $2 billion to
$3 billion. Now it’s up to $7 billion and rising, as the cost of concrete,
steel, and other materials and labor soars. MidAmerican Energy Holdings (BRK), a gas and electric utility owned by Warren Buffett’s
Berkshire Hathaway (BRK), shelved its own nuke plan earlier this year, saying it no
longer made economic sense. "The country badly needs new nuclear plants to deal
with the climate issue," says John W. Rowe, chief executive officer of Exelon
(EXC), currently the largest nuke operator, and chairman of the
Nuclear Energy Institute, the industry’s trade group. "But they are very
expensive, very high-risk projects."

So risky and expensive, in fact, that building new ones won’t happen without
hefty government support. NRG Energy (NRG), Dominion (D), Duke Energy (DUK), and six other companies have already leaped to file
applications to construct and operate new plants largely because of incentives
Congress has put in place. The subsidies include a 1.8 cents tax credit for each
kilowatt hour of electricity produced, which could be worth more than $140
million per reactor per year; a $500 million payout for each of the first two
plants built (and $250 million each for the next four) if there are delays for
reasons outside company control; and a total of $18.5 billion in loan
guarantees. The latter is crucial, since it shifts the risk onto the federal
government, making it possible to raise capital from skittish banks. "Without
the loan guarantees, I think it would be very difficult for the first wave of
plants to move forward," says David W. Crane, CEO of NRG.

Only two companies, Japan Steel Works and France’s Creusot Forge, a unit of
Areva, are capable of forging key reactor parts such as massive pressure
vessels. There are also shortages of contractors with nuclear certification and
of skilled workers—even a lack of potential sites for new reactors. The proposed
plants are all next to existing reactors. Builders of the power plants, utility
executives say, are unwilling to commit to fixed prices and fixed schedules.
Most companies want to be paid their actual costs, including overruns, plus a
reasonable return, says one CEO.

That’s why experts say the much-heralded nuclear "renaissance" will be slow
to flower. "I’m not quite sure the number McCain put out is obtainable," says
Adrian Heymer, senior director for new plant deployment at the Nuclear Energy
Institute. "If there are any hiccups in coming in on time or on budget, it will
be a struggle to go much beyond the first eight or 10 plants." Exelon’s Rowe
adds that the industry can’t grow until the government solves the waste problem,
either by opening a proposed storage site in Nevada, or by setting up surface
storage facilities around the country. And in the long run, to cut the amount of
waste, he says, "it’s very clear that we’ve got to have a fuel-recycling
technology."

The trouble is, separating out plutonium in the spent fuel for reuse is
costly and dangerous, argue critics like Princeton University physicist Frank N.
von Hippel. And in any case, worries over separated plutonium being diverted to
make bombs led the U.S. to ban reprocessing 31 years ago.

Moratorium on Solar Power Plants on Public Lands Ended

NYTimes.com reports:

The federal government has placed a moratorium on new solar projects on public land until it studies their environmental impact, which is expected to take about two years.

Update: 7/3/2008 …amid concerns from the solar power industry, members of Congress and the general public that the freeze would stymie solar development during a particularly critical time for energy policy, the bureau abruptly reconsidered.

Maybe I’m getting very cynical about our leadership, but this stinks. Have the Saudis and oil/coal companies decided to pulls some well-funded strings in Washington? Bureaucratic slowdown is a time-tested strategy for undercutting the competition, especially in young industries.

At the same time, oil companies are being given unprecedented freedom to drill on public lands.

These new solar power plants must be threatening the fossil fuel industries (oil, coal, and natural gas), who have an army of lobbyists in Washington.

Link: Citing Need for Assessments, U.S. Freezes Solar Energy Projects – NYTimes.com.

Faced with a surge in the number of proposed solar power plants, the federal government has placed a moratorium on new solar projects on public land until it studies their environmental impact, which is expected to take about two years.

The Bureau of Land Management says an extensive environmental study is needed to determine how large solar plants might affect millions of acres it oversees in six Western states — Arizona, California, Colorado, Nevada, New Mexico and Utah.

But the decision to freeze new solar proposals temporarily, reached late last month, has caused widespread concern in the alternative-energy industry, as fledgling solar companies must wait to see if they can realize their hopes of harnessing power from swaths of sun-baked public land, just as the demand for viable alternative energy is accelerating.   

“It doesn’t make any sense,” said Holly Gordon, vice president for legislative and regulatory affairs for Ausra, a solar thermal energy company in Palo Alto, Calif. “The Bureau of Land Management land has some of the best solar resources in the world. This could completely stunt the growth of the industry.”   

Much of the 119 million surface acres of federally administered land in the West is ideal for solar energy, particularly in Arizona, Nevada and Southern California, where sunlight drenches vast, flat desert tracts.   

Galvanized by the national demand for clean energy development, solar companies have filed more than 130 proposals with the Bureau of Land Management since 2005. They center on the companies’ desires to lease public land to build solar plants and then sell the energy to utilities.

According to the bureau, the applications, which cover more than one million acres, are for projects that have the potential to power more than 20 million homes.

Our New Energy Policy: Loyal to Oil

George W. Bush is forever loyal to oil. His solution to every energy supply problem is more oil. For him, this energy crisis is a unprecedented opportunity to allow oil companies to drill in previously off-limit areas. (And our addiction to oil can be swept under the rug — again.)

I fear that the American people may buy into this short-sighted plan to avoid having to change their energy consumption habits (thus continuing to fund terrorist-supporting governments around the world).

Thomas L. Friedman at NYTimes.com describes the Bush energy policy. Excepts below.

Link: Op-Ed Columnist – Mr. Bush, Lead or Leave – Op-Ed – NYTimes.com.

Two years ago, President Bush declared that America was “addicted to oil,” and, by gosh, he was going to do something about it. Well, now he has. Now we have the new Bush energy plan: “Get more addicted to oil.”

Actually, it’s more sophisticated than that: Get Saudi Arabia, our chief oil pusher, to up our dosage for a little while and bring down the oil price just enough so the renewable energy alternatives can’t totally take off. Then try to strong arm Congress into lifting the ban on drilling offshore and in the Arctic National Wildlife Refuge.

It is hard for me to find the words to express what a massive, fraudulent, pathetic excuse for an energy policy this is. But it gets better. The president actually had the gall to set a deadline for this drug deal….

This from a president who for six years resisted any pressure on Detroit to seriously improve mileage standards on its gas guzzlers; this from a president who’s done nothing to encourage conservation; this from a president who has so neutered the Environmental Protection Agency that the head of the E.P.A. today seems to be in a witness-protection program. I bet there aren’t 12 readers of this newspaper who could tell you his name or identify him in a police lineup.

But, most of all, this deadline is from a president who hasn’t lifted a finger to broker passage of legislation that has been stuck in Congress for a year, which could actually impact America’s energy profile right now — unlike offshore oil that would take years to flow — and create good tech jobs to boot.

That bill is H.R. 6049 — “The Renewable Energy and Job Creation Act of 2008,” which extends for another eight years the investment tax credit for installing solar energy and extends for one year the production tax credit for producing wind power and for three years the credits for geothermal, wave energy and other renewables.

These critical tax credits for renewables are set to expire at the end of this fiscal year and, if they do, it will mean thousands of jobs lost and billions of dollars of investments not made. “Already clean energy projects in the U.S. are being put on hold,” said Rhone Resch, president of the Solar Energy Industries Association.

People forget, wind and solar power are here, they work, they can go on your roof tomorrow. What they need now is a big U.S. market where lots of manufacturers have an incentive to install solar panels and wind turbines — because the more they do, the more these technologies would move down the learning curve, become cheaper and be able to compete directly with coal, oil and nuclear, without subsidies.

That seems to be exactly what the Republican Party is trying to block, since the Senate Republicans — sorry to say, with the help of John McCain — have now managed to defeat the renewal of these tax credits six different times.

Of course, we’re going to need oil for years to come. That being the case, I’d prefer — for geopolitical reasons — that we get as much as possible from domestic wells. But our future is not in oil, and a real president wouldn’t be hectoring Congress about offshore drilling today. He’d be telling the country a much larger truth:

“Oil is poisoning our climate and our geopolitics, and here is how we’re going to break our addiction: We’re going to set a floor price of $4.50 a gallon for gasoline and $100 a barrel for oil. And that floor price is going to trigger massive investments in renewable energy — particularly wind, solar panels and solar thermal. And we’re also going to go on a crash program to dramatically increase energy efficiency, to drive conservation to a whole new level and to build more nuclear power. And I want every Democrat and every Republican to join me in this endeavor.”

That’s what a real president would do. He’d give us a big strategic plan to end our addiction to oil and build a bipartisan coalition to deliver it. He certainly wouldn’t be using his last days in office to threaten Congressional Democrats that if they don’t approve offshore drilling by the Fourth of July recess, they will be blamed for $4-a-gallon gas. That is so lame. That is an energy policy so unworthy of our Independence Day.

Suburban Reality: We spend too much time and money driving

Energy prices are pummeling the American lifestyle, which until recently was labeled as not negotiable by our leaders. These same leaders did not see the need for a viable energy policy.

Link: Life on the fringes of U.S. suburbia becomes untenable with rising gas costs – International Herald Tribune.

As the realization takes hold that rising energy prices are less a momentary blip than a restructuring with lasting consequences, the high cost of fuel is threatening to slow the decades-old migration away from cities, while exacerbating the housing downturn by diminishing the appeal of larger homes set far from urban jobs.

In Atlanta, Philadelphia, San Francisco and Minneapolis, homes beyond the urban core have been falling in value faster than those within, according to analysis by Moody’s Economy.com.

In Denver, housing prices in the urban core rose steadily from 2003 until late last year compared with previous years, before dipping nearly 5 percent in the past three months of last year, according to Economy.com. But house prices in the suburbs began falling earlier, in the middle of 2006, and then accelerated, dropping by 7 percent the past three months of the year.

Many factors have propelled the unraveling of U.S. real estate, from the mortgage crisis to a staggering excess of home construction, making it hard to pinpoint the impact of any single force. But economists and real estate agents are growing convinced that the rising cost of energy is a primary factor pushing home prices down in the suburbs – particularly in the outer rings.

More than three-fourths of prospective homebuyers are more inclined to live in an urban area because of fuel prices, according to a recent survey of 903 real estate agents with Coldwell Banker, a national brokerage.

Some proclaim the unfolding demise of suburbia.

"Many low-density suburbs and McMansion subdivisions, including some that are lovely and affluent today, may become what inner cities became in the 1960s and ’70s – slums characterized by poverty, crime and decay," said Christopher Leinberger, an urban land use expert, in a recent essay in the Atlantic Monthly.

Most experts do not share such apocalyptic visions, seeing instead a gradual reordering.

U.S. Energy Policy: Get More Oil from OPEC

Our current energy policy: ask the Saudis for more oil. Unfortunately, the Saudis have other customers (China) who are willing to pay whatever they want to charge.

Chris Nelder at Energy & Capital describes how we became dependent on OPEC Arab countries, with almost no alternatives.

How can the U.S. get out of this precarious predicament?

Link: Peak Oil Consequences of Bush’s Failed Energy Policies.

When George W. Bush was first running for president in 1999, and oil had risen to the shocking price of $30 a barrel, he chastised President Clinton for it, arguing that he "must jawbone OPEC members to lower prices."

As his campaign went on, the "jawbone" solution became a regular part of his stump speech. In June 2000, the New York Times reported:

"I would work with our friends in OPEC to convince them to open up the spigot, to increase the supply," Mr. Bush, the presumptive Republican candidate for president, told reporters here today. "Use the capital that my administration will earn, with the Kuwaitis or the Saudis, and convince them to open up the spigot."

His pitch was essentially unchanged in the spring of 2005, with oil now trading in the $50s: "I’ll be talking to our friends about making sure they understand that if they pinch the world economy too much, it’ll affect their ability to sell crude oil in the long run," Bush said.

To be fair, Bush has sent his energy secretary, Samuel Bodman, several times to try to talk OPEC into producing more oil, but he too has been frustrated. "I certainly have made my views known. Whether they respond or choose to respond is up to them and not up to me. I’m doing the best I can within the limited sets of options that we have," Bodman recently remarked.

Neither Bodman’s efforts nor Bush’s have produced results. Not only has Bush earned no capital with Kuwait or Saudi Arabia, he’s been earning their disdain.

Last Sunday, on his second jawboning trip to Saudi Arabia this year, the president had the temerity to lecture the Saudis over their morality, social policies, and energy policy. He warned that "the supply of oil is limited, and nations like mine are aggressively developing alternatives to oil."

"Over time," he cautioned, "as the world becomes less dependent on oil, nations in the Middle East will have to build more diverse and more dynamic economies."

The Saudi leadership was swift to respond, chastising those "who are questioning our oil practices and policies." They were also quick to point out that their decision to increase oil production by 300,000 barrels a day by June was not influenced by Bush’s trip. That decision was made a week prior, and was simply calculated to meet anticipated demand.

The markets weren’t impressed, and responded to his trip by sending oil a few dollars higher, to over $126 a barrel.

"Bush’s credibility is zero anyway," remarked Walid Khadduri, a Beirut-based consultant, on the trip. "I really don’t know anyone who follows what he says, especially after what has happened in Iraq and then his Knesset speech the other day," he said, referring to Bush’s apparent swipe at Barack Obama at a recent speech to the Israeli legislature, wherein he said that "some seem to believe we should negotiate with terrorists and radicals."

OPEC knows the score on oil as well as anyone. They are basically correct in asserting that the markets are well-supplied, and that global refining capacity for the ample supplies of heavy sour crude from sources such as Iran, Saudi Arabia and Venezuela is limited.

They also know that, as I have written about previously, the skyrocketing price of oil in recent times has as much to do with the sinking dollar as anything else. But the Bush administration has done nothing about that, so why should OPEC make extraordinary efforts to increase oil production? They would rather simply limit their exposure to the Fed’s failed fiscal policy by trading more oil in euros and other non-dollar denominations.

Finally, OPEC knows that peak oil has arrived, and its members are becoming more focused on stewarding their black gold riches for their own countries’ benefit than they are on trying to prop up the U.S. economy. "I think it’s a mistake to have your biggest customer’s economy to slow down," Bush whined, but OPEC is looking at their biggest customers going forward: not the U.S., where petroleum consumption is slowly declining, but the emerging economies of the world, where demand is red-hot.

But President Bush has continued to pretend that we can drill our way to oil freedom, if only those damn Democrats and environmentalists would get out of the way…even though he knows that’s not true.

Does your state encourage Solar Energy?

The latest Freeing the Grid report from the Network for New Energy Choices rates the states.

I live in Georgia, a backward state for energy policy.

Link: Freeing the Grid

Ga netmeeting and interconnection

Net metering is a regulatory policy that allows people to sell electricity back to the grid from their own renewable energy facilities, such as a solar array or a wind turbine, incentivizing renewable distributed energy generation projects. The Energy Policy Act of 2005 pushed utilities to adopt net metering as a policy but enforcement and program design has fallen mostly to the patchwork of state utility regulators.

Interconnection: Each state regulates the process under which a generator can connect to the distribution grid. These policies seek to keep up the stability of the grid as well as the safety of those who use and maintain it. However, if not implemented properly, these policies may pose a barrier to the development of customer-sited renewable energy and other forms of Distributed Generation (DG). Customers who seek to generate their own electricity—with a photovoltaic (PV) system or wind turbine, for example—and hook up to the grid must first go through this interconnection process. Many customers encounter unworkable interconnection requirements employed by utilities. In some cases, the interconnection process is so lengthy, arduous and/or expensive that it thwarts the development of customer-sited generators—especially in the case of smaller systems.