World Energy Monthly Review: March 2007	Download a PDF file of this article

Stuck on Stupid

by Richard R. Loomis and Susan Salter

When George W. Bush took office in 2001, he declared that the Kyoto Protocol was bad for America and that we needed to pursue our own course. Over the next few years, many in the scientific community debated the effects of humanity on global warming, and for much of the Bush administration, there was no climate-change problem - at least, not in the opinion of the White House, which avoided discussion on the subject. The president has refused to go along with controls brokered by the United Nations on carbon dioxide as Bush contended that the U.N. resolution would harm the U.S. economy. In the meantime, the country had an election, and suddenly "global warming" is "climate change" and both the White House and Congress are reworking their position.

Thanks to such recent "inconvenient truths" as the Stern Review on the Economics of Climate Change, published last October, and the U.N.'s Intergovernmental Panel on Climate Change (which declared itself "99 percent certain" that human activity has caused global warming), as well as some very questionable science declared as fact by certain past presidential candidates, the world's embattled environment has become a hot-button issue that even the Iraq-focused Dubya cannot ignore. In this year's State of the Union address, Bush declared a mission to reduce U.S. dependence on foreign oil, calling on fuel standards that mandate the production of 35 billion gallons of alternatives in 10 years.

The president's focus on energy coincides with the election of a Democratic Congress whose cues are being set by left-coast characters like Sen. Barbara Boxer (D-Calif.). So we have gone from a Republican Congress to a Democratic one - and gone from having an energy plan that doesn't focus on domestic production of oil and gas or long-term stability to & an energy plan that doesn't focus on domestic production of oil and gas or long-term stability but includes a lot of rhetoric on climate change. It is sad but true: We are still "stuck on stupid."

The Debate Is Heating Up, but Is the Earth?

Important to the question of how to curb climate change is the related question: Is the climate actually changing? "It is worth restating some basic physics," wrote Dr. James Buckee of Talisman Energy in World Energy magazine (Vol. 3, No. 1). "The earth is warmed by radiation from the sun. Some two-thirds of the sun's energy reaching the earth is retained by the atmosphere and the earth's surface. One-third radiates back to space. Unfortunately for the global warming theorists, the earth is not warmed evenly throughout the atmosphere, oceans and crust. In fact, the varying temperatures on earth are determined by ever-shifting interplays of wind, water vapor, sunlight on heat-absorbing solids and other factors."

Another contributor to World Energy (Vol. 4, No. 2), Walter Cunningham, a former astronaut and chairman of the Texas Aerospace Commission, pointed out that "reputable scientists have been trying for a decade to get the legitimate facts about global warming in front of the public. Scientists have known of the existence of a natural greenhouse effect in the atmosphere since the 19th century, but that is not to be confused with any influence from human activity." In 1898, he said, the Swedish scientist Arrhenius determined that carbon dioxide in the atmosphere could trap the earth's heat like the glass of a greenhouse. Carbon dioxide, methane, nitrous oxide and other "greenhouse" gases are transparent to incoming sunlight (UV) but absorb the infrared radiation that the earth emits back to space to maintain its heat balance.

Over in Canada, Gwyn Morgan of EnCana took exception to the Kyoto Protocol, writing in World Energy (Vol. 5, No. 3): "The most severe impact of Kyoto would be on consumers, not producers of energy - in other words, on essentially all Canadian businesses and individuals from sea to sea. Why? Because more than 80 percent of greenhouse gas emissions come from the consumption of energy, rather than its production. Recent public polls may show support of Kyoto based on some vague, noble concept of a cleaner environment, but these polls also show that support quickly disintegrates when Canadians are asked about the inevitable personal sacrifices, major lifestyle changes, higher fuel costs and job losses. Support would deteriorate even more drastically once Canadians came to understand that Kyoto would do little or nothing to clean up our air quality, nor to stop global warming, making their sacrifices 'pain for no gain.'"

"We need to take a deep breath," said Washington Times columnist Paul Driessen. "Acknowledge that the Kyoto Protocol and proposed 'climate protection' laws will not stabilize the climate, even if CO2 is to blame. And recognize that there are reasons more people now support climate 'consensus' other than concern over climate disasters created by deficient computer models and Hollywood special effects."
Speaking of Hollywood special effects: How many people realize that newly minted Oscar winner Al Gore is leading us on a path that will ultimately continue to pad his pocket? He owns a company that will profit greatly from carbon credit trading and a house that burns more electricity than some neighborhood blocks. He also is very interested in running around in his private jet while he tells audiences of the impending doomsday caused by their running around in their Suburbans. One has to wonder if his concentration on this issue is really motivated by the consumption trends of the general public or if he is really focused on profits.

Where Congress Has Gotten Us

We said it all along in World Energy Monthly Review: Many in Congress want to fix energy problems in the worst way. And they are.

In 2005, proposals touching upon all facets of the energy industry were brought to the table. Representatives John Barrow (D-Ga.) and Sam Graves (R-Mo.) introduced a bill to establish trading limits on natural gas because of fears that "speculative trading and irrational investing have caused a lot of the volatility in natural gas prices." Senator Judd Gregg (R-N.H.) and others advocated a windfall profits tax on energy. Presidential hopeful Hillary Clinton (D-N.Y.) proposed a "strategic energy fund" to support development of new energy technologies, which would be funded by taxes on energy company profits. Not the brightest of concepts, but at least it is not clouded with "climate change" to complicate things.

The energy bill passed by Congress, HR6, was "worse than nothing. It is a waste," as we wrote in World Energy Monthly Review (June 2005). "Consider this: Americans spend $500 billion-plus a year on energy based on wholesale fuel prices. Instead of spending the money on critical research, the feds will commit $14 billion to hundreds of pet projects over the next decade." From the extension of daylight-saving time to the $2.4 billion for low-income housing, the bill's initiatives provided "a classic example of treating the symptom rather than the disease." The call for a goal of having 7.5 percent of U.S. energy come from renewables by 2013 "is completely unrealistic unless you play one or more of the common tricks of the renewable energy trade." Those tricks include:

• calculating based on "installed megawatts" so that wind power counts even if the blades are not turning;
• excluding heating and cooling from the denominator - rationalized as removing the seasonal variations; and
• making calculations based on electric power generation only, a fractional subset of total U.S. energy consumption.

Even the good part of the energy bill - the part promoting clean coal and coal gasification - suffered from a lack of real leadership. "Any leadership role from the United States will be based on our corporate prowess and not the proposed federal spending," we said in 2005. "The early billions offered by the federal government could have been huge but have become almost irrelevant. There are now many Fortune 500 companies in the game, and the most substantial players are not even tampering with the poorly conceived and indefinitely delayed incentive monies from the U.S. government. Both Australia and China now appear to have seized leadership roles ahead of the United States."
Flash forward to today. The current Senate Committee on Energy and Natural Resources - led by those across-the-aisle New Mexicans, Majority Chairman Jeff Bingaman and Minority Ranking Member Pete Dominici - unveiled its Energy Security for America plan in February, with the goal of pursuing "a series of legislative initiatives and oversight activities designed to put America firmly on the path toward achieving [energy security]."

The Senate Energy Committee's first goal:

• Transform America's transportation sector by encouraging the manufacture and adoption of electric and hybrid vehicles, developing advanced lightweight materials and updating the U.S. infrastructure to accommodate plug-in technology at major hubs such as ports and airports.

All of this sounds good until you look at the actual impact. Electric and hybrid vehicles have a market, but the country cannot produce enough electricity in its current system should they become adopted. Meanwhile, hybrid technology still relies on gasoline. This ignores the fact that diesel fuel is producible in the United States and would maximize the effect of the hybrid.

Other Energy Committee goals include:

• A binding, national renewable energy requirement, which mandates that 15 percent of the nation's electricity is derived from clean energy sources by 2020, including solar, geothermal, wind and other forms of renewable generation. Once again, hydrocarbon is being equated with "dirty." The United States can produce clean energy using its hydrocarbons in far greater quantity than the renewables can produce.
• Policies to encourage "smart grid" development, which will create a more reliable energy system, ease integration of new renewable resources and distributed generation, and create demand-response incentives for industries and individual consumers.
• Measures to help lower utility bills for consumers and businesses by encouraging more productive use of electricity and natural gas through integrated energy-management strategies, high-performance appliances and state-of-the-art green buildings.
• Real federal leadership, requiring the government to reduce its petroleum consumption by 40 percent and purchase 20 percent of its energy from renewable sources by 2020.

One key to the Senate's wrongheaded approach is its firm belief that America can reduce emissions without affecting the economy. It is not probable. It is not even possible. What's left of the plan is a lot of regulation and zero effect on emissions reduction.

Leadership in this area is needed. Our Congress needs to change its paradigm; instead of trying not to affect the economy, Congress needs to think of ways that energy legislation can improve the economy. Recently Senator Barack Obama (D-Ill.) introduced legislation to encourage the coal-to-liquids process. It is a good idea, but it means little without more cars that can run on ultra-clean diesel fuel. Ford, GM and Chrysler - each having suffered its own downturn in the past couple of years - could use some incentives here, and the communities that are suffering from the downturn in the domestic automobile industries could use the support.

Group Dynamics

Outside of Congress, a new coalition, the United States Climate Action Partnership (USCAP), brings together energy companies like GE, Duke, Alcoa and Pacific Gas and Electric - "companies that have been publicly advocating federal action on climate change for some time," as Amanda Griscom Little wrote in a Salon.com piece. This "corporation-led call to arms boosts the prospect for a meaningful climate bill in the 110th Congress."

Still, "differences remain both between and within industries over the steps needed to combat climate change," noted the National Journal's newsletter CongressDaily. "Utilities that rely on coal would potentially shoulder the largest burden under a mandatory reduction program. Nuclear power producers, on the other hand, deal with limited emissions and might benefit from a cap-and-trade system allowing them to sell credits to other utilities."

Ethanol Is the Future & of Ethanol

In 2005, the Senate Energy Committee declared that "farmers across the country are investing in corn, soybeans and other crops that can produce billions of gallons of ethanol thanks to the ethanol mandate in the energy bill. Over the next decade, ethanol fuels are expected to replace 2 billion barrels of foreign oil and create 234,840 new jobs." New ethanol plants, the Senate continued, "will add nearly 2 billion gallons of ethanol to the nation's fuel supply in 2006 - a 50 percent growth in ethanol production capacity." This February, the Bush administration committed $179 million of the fiscal 2008 budget to research into producing ethanol.

That's big news for Big Corn, but ethanol was and likely will remain an inefficient and very expensive cure for America's oil addiction. Still, ethanol has received bipartisan support. "Try finding a politician, even outside the Midwest, who doesn't see ethanol as an energy elixir capable of running cars and creating jobs," challenged Pat Guinane in Illinois Issues Online. "Like a heroin addict moving to methadone, the country is replacing its oil habit with a chemical that arguably is only marginally better for us. Like hard drugs, foreign oil brings the prospect of death, in this case through military involvement in unstable oil-rich regions. Corn-based ethanol instead fosters a costly system of dependence in return for what could be considered paltry public benefits."
Ethanol will be a part of the U.S. fuel mix as long as the government is willing to support it, but what will happen when the government support is reduced or eliminated?

Finger-pointing Politics

"In accusing ExxonMobil of giving 'more than $19 million since the late 1990s' to public policy institutes that promote climate holocaust 'denial,'" noted Driessen, "Senate Inquisitors Olympia Snow and Jay Rockefeller slandered both the donor and recipients. Moreover, this is less than half of what Pew Charitable Trusts and allied foundations contributed to the Pew Center on Climate Change alone over the same period." What's more, added Driessen, "it's a pittance compared to what U.S. environmental groups spent propagating climate chaos scares."

Again, it's a classic case of being "stuck on stupid"; Congress is going to make sure that any alternative thought is reduced or eliminated before it can expose any holes in the climate-change story.

Boxer Rebellion

There's idealistic, there's finger-pointing and then there's Barbara Boxer. Perhaps no one on Capitol Hill commits to an environmental cause with such an intriguing array of questionable tactics. During the 2005 Senate hearings on oil-company profits, Boxer held up the show with irrelevant observations on how energy CEO compensations give the shaft to the average American - conveniently forgetting that in America, anyone can earn as much as the market is willing to pay (and leaving out the nugget of information that Sen. Boxer's own salary was 200 times greater than the average American's net worth).

With a new Congress came new opportunities for Boxer, chair of the Senate Environment and Public Works Committee, to plead her case. In February, she called for a Bush-led summit on climate change, asking for the leaders of 12 nations, including China, Russia, Japan, India and Mexico, to convene in Washington. "Bringing these heads of state to the White House to deal with this serious threat to our planet would send a much-needed signal that the United States of America is ready to once again set an example for the world," Boxer wrote.

Get real, responded one pundit. "Pushing [heads of state] to do anything beyond talking is worthwhile, but banking on it is probably foolhardy," David Goldston, a former Congressional staff member and current scholar-in-residence at the Woodrow Wilson School of Public and International Affairs at Princeton University, told Environment and Energy Daily.

Stop the Madness!

In the end we have gone from a Republican-led bad energy policy to a Democrat-led bad energy policy with the addition of an unproven and possibly even harmful focus on "climate change."
Our government continues to be "stuck on stupid" when it comes to energy policy and easily swayed by rhetoric and the media. The United States continues to deny that its economy is reliant on inexpensive energy and is growing. We must provide the energy needed to maintain our position as the world's leading economy. It is no secret that we can produce enough energy if we begin to focus on where the resources needed for abundant energy are located and concentrate on development. We must realize that the more domestic sources we develop, the more secure our economy will be, and the greater our ability to affect the global debates on terrorism, consumption and, ultimately, climate change.

What will it take - what visionary (and realistic) president, what educated and unbiased Congress, what can't-miss incentive from the private sector - before we can stop being "stuck on stupid"?