By Andy Mannle | Friday, 13 June 2008
Speaking before a remote audience at the recent Virtual Energy Forum, Newt Gingrich discussed his plan for freeing America from foreign oil and combatting global warming: "Drill Here. Drill Now. Pay Less." Can he square that with his advice to hire an 'environmental scout' and follow the 'best in class' in going green?
Calling the Climate Change bill that was duly defeated in the Senate last week "almost grotesque" for "proposing this scale of governmental control and cost increase," Gingrich argues that we should tap the inventiveness of the free market, and invest in technology to fight climate change.
Ironically, the American Solutions Gingrich puts forward on his website would all require major government investment and assistance. Mining oil sands in the Rockies, drilling for oil in the North Atlantic, developing technology to securely sequester carbon, or building nuclear power plants are not small operations. Even his most progressive suggestion that we "massively incentivize electric vehicles," would require government support.
But Gingrich is correct that market-based solutions, technological advances, and individual efforts have a crucial role to play in solving our energy and environmental crises. Does his business advice match his proposed national policies?
"The American people believe we can solve our environmental problems, and this is what we meant by Green Conservatism: we can solve our environmental problems faster and cheaper with new technology and innovation than with more litigation and more government regulation."
Gingrich argues that the government is incapable of regulating a complex scheme like carbon cap and trade, and cites the failed attempt by the Dept of Energy to build a Future-Gen clean coal plant, and an example of governmental incompetence. His proposed solutions, however, would not be possible without considerable government oversight, management, and investment.
Environmental regulations are only going to get more strict, not less. Which means it will be even harder to develop dangerous, extractive, or polluting projects in the future. There are both political and financial reasons why we haven't built a nuclear power plant in nearly a generation, and that 2007 saw an effective moratorium put on new coal plants.
So what can we do to square our enormous appetite for energy with our increasing concerns over the environment?
Tapping Inventiveness and Ingenuity
Gingrich says we should tap our inventive ingenuity, and offer prizes for new solutions. The X Prize, the Solar Decathlon, and others in virtually every field are doing that. Inventors are coming up with better solar cells, longer-lasting batteries, urban greenhouses, waste-to-fuel strategies, and a myriad of other sustainable solutions, not just for our energy needs, but for a range of problems.
Gingrich is right that this is a global problem, and that the inventiveness of Edison or the Wright brothers is not limited to America. When asked by the moderator if he would consider making these prizes open to all comers, he agreed that, "if there are 17 really smart Chinese or Indian science majors who're willing to stay up all night for the next year and invent a car that has no pollution, do they get the prize? My instinct is to say sure. What we're interested in is the progress for everyone."
Offering a prize for efficient vehicles, water saving devices, or better batteries is an excellent way to crowdsource the solution process. But it will take more than a few science majors pulling all-nighters to find a way to sequester carbon. And incentivizing rogue teams of inventors to research nuclear power is not the type of progress we want to see happening in China and India - or Pakistan and Iran.
Longterm Solution or Temporary Supply?
Arcwire put the question to Gingrich, through the moderator, "How long do you predict the oil in Alaska would last? Wouldn't it be better to concentrate on energy efficiency, and longterm supply sources like solar, wind, tidal, wave, and geothermal?"
His response was revealing.
"Well first of all, the amount of energy we have in coal is probably 1500 years, the amount of energy we have in nuclear is probably 700 to 1000 years, the amount of energy we have in the Rocky Mountains in shale oil is three times the size of Saudi Arabia so its probably 60-70 years by itself. If we had three or four finds the size of Brazil's, we would quadruple or quintuple the American reserves."
He admits that, "I'm not prepared to say this morning" how much oil is there. But, "I'm an optimist."
Others are not so optimistic. Among them is former CIA director and energy security analyst James Woolsey. In his presentation to the Virtual Energy Forum the same day, he that 95% of the Alaskan oil shelf is already open for exploration, and only 5% remains unexploited. While there is likely to be some oil there, the odds of a major find in that remaining five percent are very small.
As for carbon sequestration, Woolsey says technology is only part of the problem. "We know how to do it. But can we do it reliably, at scale, for an effective cost, over a long period of time?" Nobody knows, and our main experiment to find out went so over budget, that they finally pulled the plug. Hardly a market success story.
So to imply that this energy is just waiting to be had, significantly downplays the costs - fiscal, social, political, and environmental - of exploiting these resources. And the idea that we might stumble upon "three of four finds the size of Brazil," is simply not supported by current information.
How Much Oil Is Out There?
As Gingrich himself notes, we have much better geology and technology than in the past. "We've learned an immense amount in the last forty years." Decades of heavily-funded oil engineers have gotten extremely good at identifying and extracting ever deeper and more remote sources of oil. But the results of our state of the art mapping and modelling, as well as the actual yields from major fields around the world all point to less oil in the ground, supply curves dropping, and the looming prospect of peak oil.
The most recent articles posted on Gingrich's own website give sources from the U.S. Minerals Management Service and the Interior Department estimating 86 billion barrels of undiscovered oil resources in American waters - Pacific, Atlantic, and Gulf coast combined. Meanwhile the latest report from the International Energy Agency projects that we'll use some 86 million barrels a day in 2008.
In other words – drilling up all the rest of the oil in our oceans would provide enough oil to last 1000 days, or just under three years.
Hardly a longterm energy strategy. Not nearly enough to provide energy independence, or free us from the foreign dictators who control our energy supply.
And while Gingrich is content to "doubt very much if we have a clue how much potential energy there is," he does think "we have to have a new generation of technology in order to use that energy in an environmentally safe way." This would most certainly add to the time and expense of bringing those fuels to market.
He also supports "requiring companies to put up very extensive bonds to ensure against environmental damage," which is both another example of government control of the market, and also an economic hurdle that would drive up the price of those fuels.
Thus the conclusion that a "Drill here. Drill Now" campaign would actually result in "Pay Less," in any significant way, seems highly unlikely.
The truth is that continuing our current fossil-fuel regime carries exorbitant costs, while at best offering short term relief, not a true solution. Our wasteful habits and excessive consumption patterns are causing many other problems as well, and continuing our dependence on fossil fuels would do little to address those.
Nor would it do anything to address deforestation, which contributes 20% of global greenhouse gases; or meat and dairy consumption, an increasingly significant cause of resource depletion and global warming.
Good Green Advice
When asked to offer suggestions for organizations, he gives good advice. First, "Hire somebody to be an environmental scout," to constantly scan for "new ideas, new incentives, new breakthroughs". Secondly, "benchmark best of class. Every time you're about to make an investment, ask who is doing the best job of this, and then learn from them. I have a simple reason for this...imitation is cheaper than invention."
What if we followed Gingrich's advice instead of his proposals? Instead of drilling for oil, and chasing clean-coal, what if we applied the advice he offers companies to the nation as a whole?
America's Environmental Scouts
The current administration has by all accounts one of the worst environmental policies on record, and efforts to change those policies have largely been divided along party lines, with Republicans routinely backing or acquiescing to Bush's policies.
Gingrich argues that it is possible to be a Republican and a friend of the environment. "Conservative and conservation, share the same root, he points out, noting that historically Republicans have been environmentally responsible. Nevertheless, under recent Republican leadership, the US has routinely interfered with science, gutted environmental laws and regulations, obstructed cleaner air standards, fought against protecting endangered species and hampered international efforts to take action on climate change.
But while we have not had good environmental scouts at the Federal level, politicians of all stripes at the state and local level are fighting for cleaner energy, and a healthier environment. And the odds are almost certain that either McCain or Obama would carry these efforts much further as president.
Outside the political arena, the nation has a variety of 'environmental scouts,' that are actively exploring faster, cleaner ways to power our economy, and improve our communities.
Top representatives from the investment community are gathering at the Waldorf Hotel in New York next week for the Renewable Energy Finance Forum. So many people applied they had to close registration.
The US Green Building Council's LEED guidelines are fast becoming the standard to beat, directly tackling the 30% of our emissions that come from buildings. Gingrich's own polling suggests that 90% of Americans support measures to "Encourage homeowners and builders to incorporate alternative energy systems in their homes like solar, wind, and geothermal."
The Designers Accord has been adopted by major industrial and graphic design associations to green up thousands of products we use in our daily lives. Architects, urban designers, and planners are all competing to green up cities across the country, while scientific and academic communities are racing to understand and address our environmental challenges.
All of these 'scouts' are are pushing for better cities, and healthier communities; and they are actively developing more effective and profitable solutions than coal and oil extraction.
Wouldn't we be wise to follow their lead?
Following the "Best in Class"
Second, Gingrich advises organizations to find whichever companies or technologies are the most successful, and adopt the best practices available.
He cites Norway, Finland, and Denmark as examples of strong economies with strict environmental standards; nations with both green policies, and significant fossil fuel production in the form of North Sea oil and natural gas. He cites France, saying if we had the nuclear they have, we'd be emitting tens of tons less CO2.
But what about following the example of cities from Curitiba, Brazil; Portland, Oregon, that are making world-class communities by going green? What about following the example of WalMart, Dupont, PG&E, or the hundreds of other companies that are finding profits in cleaning up their waste stream and investing in efficiency? What about following the 'best in class' in terms of solar power, mass transit, and water conservation?
Gingrich cites Denmark as a country that produces "an amazing amount of wind power for electricity, they're probably the leading country in the world per capita."
Why aren't we imitating that leadership?
True American Solutions
The truth is that neither clean-coal nor safe nuclear power are available today. Both will require years of research, and billions of dollars to bring to market.
So the real choice is between spending that time and money developing better fossil fuels, or spending that time and money developing diverse, longterm, truly secure forms of energy. Solar power is a small percentage of our portfolio today, but it's increasing rapidly, and it will never run out. Wind is already competitive with fossil fuel in many places, and could be a major player in coming years with no security risk, no complicated new technology, and no waste.
Rather than see the rising price of energy as a problem, many are viewing it more as a catalyst, because in looking for ways to overcome our dependence on cheap oil, we are finding solutions for a whole variety of related problems, from inefficient infrastructure to asthma, obesity, and other health issues.
True American solutions are not to be found in Arctic oilfields, or the tar sands of the Rockies, but in the many communities around the country who are going green. Farmer's markets have increased dramatically over the last ten years, renewable energy investment is soaring, SUV's are going out of production while the Prius is a bestseller, governors and mayors across the country are competing to outgreen each other, plant trees, curb emissions, incentivize efficiency, and reduce waste. And all these changes are healthy for the communities where they are happening.
People are both saving money and making money doing these things.
Truly solving our energy, environmental and national security issues will also improve many community, economic, and health issues as well. And while these changes will be challenging, they represent a strident step forward that people are embracing, inventing, and adopting all across this great nation.