The new U.S. energy policy

July 1, 1993

The new U.S. energy policy

By John Richter, Freelance Writer

Prior to the Arab oil embargo of 1973, few Americans had any idea that we had become dependent on imported oil. It was well known within the industry, government, and some academic circles. The signs had been coming for some time; U.S. oil production had exceeded new discoveries since 1959.

Actual U.S. production had reached its peak in 1970. Seeing that something had to be done, Richard Nixon announced “Project Independence” in 1974, with the goal of achieving “energy self-sufficiency by 1980.” Recalling the Manhattan Project, Nixon declared that American science, technology, and industry could free the United States from dependence on foreign oil. The project included the controversial plan to drill for oil in Alaska’s North Slope and opened up vast off-shore areas to oil exploration.

Project Independence failed to meet its objective. When it was announced in 1974, U.S. net oil imports were 35 percent of consumption. By 1980, this figure had grown to more than 37 percent. The project was doomed to failure because it was based on the false premise that the U.S. could become self-sufficient by increasing oil production. Because the U.S. was already the most explored and drilled nation in the world, this approach could not possibly reverse our dependency on imported oil. The state of Oklahoma alone has more than 500,000 oil wells. We can’t find much more domestic oil simply because we’ve already found, extracted, and sold it.

In 1977, President Jimmy Carter announced that the energy crisis was “the moral equivalent of war”. In an Oval Office broadcast to the nation, he outlined his policy: “To give us energy security, I am asking for the most massive peacetime commitment of funds and resources in our nation’s history to develop America’s own alternative sources of fuel: from coal, from oil shale, from plant products for gasohol, from unconventional gas, from the sun.”

A combination of Carter’s policies and spiking oil prices did have some effect. U.S. oil imports declined from a high of more than 46 percent in 1977 to below 30 percent for several years in the mid-1980s. This resulted largely from reduced consumption; by 1983, U.S. oil consumption had fallen 13 percent. US oil consumption remained below 1977 levels until 1993.

President Reagan changed all of these policies just as quickly as he could after taking office in 1980. The solar panels came off the White House. In a single day, half of the employees of the National Renewable Energy Labs (NREL) were laid off. Our energy was more focused on foreign policy than domestic policy. Because Saudi Arabia dramatically increased production, oil prices plummeted from more than $30/barrel, to less than $10/barrel. Most U.S.-based makers of solar and wind energy systems went out of business. In 2001, the U.S. imported 54 percent of its total oil consumption.

In May of 2001, President Bush proposed a set of energy legislation, but it failed to pass congress. In a throwback to the Nixon era, this proposal praised new technology, offered to open coastal and preserved areas to oil and gas exploration, and ease restrictions on nuclear power. This policy was aptly nicknamed “drain America first.” It would have benefited U.S. oil companies greatly, but its effect on U.S. oil imports would have been small, and temporary. Given the plethora of petroleum experts in the Bush administration, they surely knew this. But while this proclaimed energy policy was not enacted, a new policy is underway and quite plain to see—yet it has never been announced or debated.

This new stealth energy plays America’s trump card to ensure a secure and low-priced flow of oil for the next decade or so. It’s so simple; everyone outside the U.S. is on to it. Russia would not allow the passage of a UN resolution until the administration promised to cut them in on the deal. The CEO of British Petroleum denounced the plan without naming it. But the administration is slowly revealing the plan.

Bush told House and Senate energy bill conferees last month that “American technology will have those oil fields even more productive” after the U.S. ends Saddam’s regime, confirmed Rep. Charles Rangel (D-Manhattan), who attended the meeting. Secretary of State Colin Powell recently said that the U.S. would consider boosting Iraqi oil production to pay war costs.

So oil, now above $30/barrel, could plummet in price in a post-Saddam world, as the U.S. “develops” the world’s second largest and least exploited oil reserves. Companies working on alternatives to oil will get hurt—again.

Of course, President Bush continues to claim that the planned invasion of Iraq is not about oil, but about “weapons of mass destruction” (WMD). Do you believe him? After a month of unfettered on-the-ground inspections, the UN has found no evidence of WMD.

Meanwhile, North Korea (another charter member of the “Axis of Evil”) has declared that they have been hiding a nuclear weapons program for years, removed monitoring equipment, and kicked UN inspectors out. They are reactivating a nuclear plant to make plutonium, used only to make nuclear bombs. The administration says that economic sanctions are being considered. Why the disparity in response?

As I talk to people at holiday parties, read the newspaper, and watch the news, I don’t hear any serious discussion of our new energy policy. SUV sales continue unabated. The population at large seems quite content to unleash the hell of war upon Iraq under the pretense that it’s somehow necessary because of 9/11. But while we may fool ourselves, we aren’t fooling the rest of the world. The oil we steal from Iraq will seem cheap, but the real price will be paid for decades to come.

Editor’s note: John Richter is the former legislative analyst for the Great Lakes Renewable Energy Assocation and still acts as a freelance energy consultant. At no cost, he has provided an energy plan to the City of Rockford, Winnebago County, the Rockford Park District, Rockford Public Schools, and the Council of 100 that has gone unused. For more information, contact: www.richters@globalkrossing.net

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