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Analysis: Oil dependence is here to stay

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by Rosalie Westenskow
Washington DC (UPI) Nov 21, 2008
Energy independence has been a rallying cry for years, but experts have long questioned the goal's feasibility and some now say it can frustrate efforts to solve climate change.

While U.S. politicians consistently talk about weaning the country off foreign oil, particularly from politically unfriendly regions like the Middle East and Venezuela, this focus actually detracts from bigger problems, said Roger Sant, co-founder of AES Corp., a global power company.

"Independence is totally impossible �� (and) it's distracting us from addressing climate change, which is by far a much greater threat to society," Sant said Tuesday at an event hosted by the Hudson Institute, a think tank in Washington, D.C. "The economic and human costs of these kind of changes in climate are far greater to me than the security implications of depending on our current oil suppliers."

The United States imports 16 percent of its oil from the Persian Gulf and 10 percent from Venezuela. While that's disconcerting, it's nothing compared to the disasters that could result from climate change, Sant said.

Although the goals of energy independence and climate-change mitigation often have been couched as synonymous, Sant said they are not, and policy solutions focused on decreasing foreign oil imports can counteract efforts to decrease global carbon emissions.

"To achieve energy independence, we obviously burn coal, just the opposite of what we do if we're trying to decrease CO2 emissions," he said.

Coal currently provides 48 percent of U.S. electricity, more than any other single source, according to the U.S. Energy Information Administration. As a result, if simply replacing oil is the biggest goal, coal represents the main alternative right now, either through electricity or, sometime in the future, technologies that could convert coal to liquid fuel. However, like oil, coal produces greenhouse gas emissions, which means legislation aimed at replacing oil with coal doesn't benefit the environment.

Conversely, policies aimed at reducing greenhouse gas emissions can have negative ramifications on the nature of U.S. oil imports, said William Hogan, a professor of global energy policy at Harvard's Kennedy School of Government.

"If we have a policy of conserving oil to decrease demand, what we do is reduce the supply we get from our friends �� because we'll end up taking the cheapest stuff first," he said.

Since the "cheapest stuff" comes largely from politically rocky regions, a larger percentage of U.S. money going for fuel would end up in the hands of unfriendly regimes and less would go to stable U.S. allies, like Canada.

The gap between "rhetoric and reality" leads to policies that claim to promote energy independence but hardly make a dent in the problem, Hogan said. For instance, President-elect Barack Obama's plan highlights energy independence, but the individual policies don't even begin to get the nation to that point, Hogan said.

One component of the plan is to put 1 million plug-in hybrid vehicles, which could run on homegrown electric power instead of foreign oil, on the road by 2015.

"That's half of 1 percent of the (U.S. auto) fleet -- that'll make a big dent in the problem," Hogan said sarcastically. "It's completely disconnected from the argument about energy independence."

Spending time trying to figure out how to end U.S. oil imports wastes intellectual capital because it can't be done, said Irwin Stelzer, director of Hudson Institute's Economic Policy Studies.

"Our domestic oil resources are too scanty and too costly to satisfy our needs for energy," said Stelzer, author of a recent report, "Energy Policy: Abandon Hope All Ye Who Enter Here." "Nuclear power won't happen, because it's too expensive and the waste problems are politically insurmountable. Coal could help, but the new administration and environmentalists won't allow further expanses in its use."

Diplomatic efforts could increase the amount of oil being produced in friendlier regions, though.

"It is possible that we could persuade or pressure Mexico into allowing American investments to reverse the decline in their oil production," Stelzer told United Press International.

In the end, though, that wouldn't make much of a dent in the amount of oil coming to the United States from the "bad guys," Stelzer said.

Replacing oil with homegrown renewable energy also poses a challenge, said Linda Stuntz, former deputy secretary of energy.

"We don't use �� wind or more than 10 percent ethanol blends to power our cars," Stuntz said.

While electric cars potentially could run on electricity produced by renewables, Stuntz said she's not hopeful it will make a dent in oil consumption, as current renewable energy production supplies only 10 percent of the nation's electricity. Take conventional hydropower out of the mix, and that number falls to 3.4 percent, according to the Energy Information Administration.

Others have a more optimistic outlook. While energy independence may not be possible any time soon, climate-change mitigation certainly is, said Adele Morris, deputy director for climate and energy economics at the Brookings Institution, a policy organization.

"Our priority should be putting a price on carbon and ensuring that costs reflect the whole cost of the activity," Morris told UPI.

In other words, the prices for gas or coal or other fossil fuel products would include the eventual cost to the environment of using that product. These price signals not only could help halt climate change but also, eventually, could lower oil imports, Morris said.

"There are some policies that are good for both," she said. "If you put a price on carbon, you reduce overall energy consumption and that reduces oil consumption."

As for the incoming Congress and administration, it looks like the energy independence catch phrase is still all the rage. A select committee in the House includes the goal in its name, along with climate change, and the Obama campaign consistently highlighted energy independence as one of its top priorities.

Some policymakers may have moved past the mantra of energy independence, though, and are looking at the issue through the lens of climate change. Sen. Jeff Bingaman, D-N.M., chairman of the Senate Energy and Natural Resources Committee, didn't even mention the term in a speech he gave earlier in the week outlining the biggest energy problems facing the nation and how to address them. However, his No. 1 goal to deploy clean energy technology, particularly renewables, does indirectly address the issue of oil consumption.

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