Energy Policy

Some interesting thoughts from Lynne Kiesling at Knowledge Problem regarding the USA's energy use and sources of energy in general: bq. Jeff Jarvis is writing a series called Issues 2004, and his post on energy policy from Monday tackles a lot of important questions and offers some recommendations. In addition, the comments on his post include a lot of good insights and thoughts. bq. Here are my thoughts. Jeff starts with his memories of the 73-74 oil crisis in the US, of which I largely remember sitting in line at gas stations with my mother, waiting to fuel up her 1971 Camaro and reading Laura Ingalls Wilder books (I was eight at the time). Perhaps it was a bit of a coincidence, but I do recall my father buying a Toyota in 1974 ... and taking apart and rebuilding its catalytic converter several years later. bq. Jeff is correct that we have not reduced our dependence on foreign oil in the intervening 30 years. What is remarkable, though, is how much more economic activity we are able to create and enjoy with that level of oil dependence. In other words, we create more GDP per barrel of oil than we did 30 years ago. Still, we do consume a lot of oil, even if at the margin it takes less oil to produce an additional dollar's worth of goods and services than it did then. Lynne also cites Dave Schuler at The Glittering Eye: bq. So what should the federal government do about energy independence in general and dependence on oil in particular? In my opinion, the federal government should get the hell out of the way. This is a problem that the market is absolutely able to address. Government should stop providing false incentives and let the market operate. Don't provide incentives for solar cells that take more energy to produce than they'll produce in their productive lives. Don't subsidize the production of ethanol that's more costly in energy terms than the gasoline it displaces. bq. And, of course, the largest single subsidy that the federal government provides on the consumption of gasoline is called the Interstate Highway System. If the people in Massachusetts, or Wyoming, or Texas, or California want more highways, I believe that they absolutely have the right to build them. But they shouldn't build them with money from Illinois or New York. And while we're on the subject why is there an Interestate Highway in Hawaii? Lynne's comments to this: bq. I think that's right; we do subsidize the use of technologies that are thought to have environmental benefits (such as solar and ethanol) that are less intense energy production technologies, which means that we use more resources to get the same number of BTUs of energy. The purported tradeoff is that we get less pollution in return for the increased use of resources to produce energy. That is a contentious topic -- KP readers know that there's a lot of research showing that ethanol production both is fossil-fuel energy intensive and produces emissions, while ethanol's use contributes to ozone formation according to a new study that I linked to in this post. Solar panel production is prey to many of the same criticisms. Plus I think Dave's right to point out that the Interstate Highway System is one of the biggest subsidies to energy use that we have, and that stopping that subsidy and pricing the use of the highway system would send accurate signals to drivers of the cost of their driving choices. Finally, Lynne looks at the Wired article on the new breed of Nuclear Reactors: bq. This September 2004 Wired magazine article looks at the academic research and the construction of nuclear power plants in China. China's economic growth (which contributes to the currently high oil prices) is already straining their power supplies, so China plans to build 30 new nuclear power plants in the next 16 years, all using pebble-bed technology. Pebble-bed nuclear has been around since the 1930s. Instead of fuel rods, the uranium/carbon blend is encased in baseball-sized graphite/ceramic balls, and the reactor core is cooled with helium gas. No radioactive water, no spent fuel rods to make dirty bombs. And the scale of the plant is about one-third of the big ones that we are used to here. This is the nuclear technology of the future because it's safer, cleaner and more secure. My hope is that this technology moves us away from our knee-jerk rejection of nuclear as an option, and that its different risk profile undermines the now-successful arguments for federal insurance subsidies (Price-Anderson). Thoughtful stuff -- Lynne has some more links to peruse, I just cherry picked a couple good ones.