By Drs. Robert & Sonia Vogl
President and Vice President, Illinois Renewable Energy Association
In the late 1970s, a friend and natural resources professor we were visiting in Colorado Springs, Colo., was tired of being a victim of potential soaring energy prices and threatened shortages. He had lost power for a few days and his water lines froze. Beyond the inconvenience involved were the costly repairs to restore the system. Since solar electricity was still costly, he decided to have a solar hot water system and gas heating system installed along with the existing electrical heating system. With multiple energy sources, he felt far more secure than previously.
During the past few years, officials have assured us we are on our way to energy independence. The recent cold weather challenges that scenario with gas heating shortages and spiking electricity prices. While the cold weather certainly contributed to rising energy prices, there were other important factors involved in the shortages.
A recent article in the Cook County News-Herald provides additional insights into why propane prices rose so dramatically. One explanation is that late fall corn drying contributed to a nationwide shortage. Another factor adversely affecting prices in Minnesota was shutting down the Cochin pipeline for repairs, which supplied 40 percent of their gas needs. Another pipeline that carried propane to Minnesota was reversed to carry ethane to the Gulf Coast.
Oil companies increased propane exports in 2013, diverting more than 20 percent to global markets. The combination of increased national demand along with increasing exports triggered a chain reaction adversely affecting U.S. consumers
Management’s fiduciary responsibility is to the corporation and not to the public. In his book Private Empire: ExxonMobil and American Power, Steve Coll asked whether Exelon would be building more oil refineries in the U.S. to prevent gasoline shortages. In response Exelon’s president at the time, Rex Tillerson, is quoted as having replied: “I’m not a U.S. company and I don’t make decisions based on what’s good for the U.S.”
Steve Horn points out that the Washington Monthly suggests Exxon Mobil, in effect, runs its own foreign policy. Given that ExxonMobil, Conoco Phillips, Chevron and Shell all have energy deals with Russia, Horn raises the question of how corporate policies relate to foreign policy interests of the United States.
Arthur Berman reminds us that the U.S. imports about 4 billion cubic feet of natural gas per day and questions the wisdom of exporting natural gas and propane if such actions make it increasingly difficult to meet our own energy needs. Exporting more natural gas is profitable for the firms involved, but increases the costs to citizens and our economy.
A policy brief by Spencer, Sartor and Mathieu, funded by the French government, recognizes the dramatic increase in U.S. production of oil and gas offsets imports. They point out that a fall in energy demand from the recession, improved energy efficiency and changed consumer behavior as a result of rising energy prices has made the largest contribution to reduced energy imports.
Rather than remain victims of global energy interests, individuals and local communities should continue to pursue behavior changes, conservation, energy efficiency and renewable energy options.
Drs. Robert and Sonia Vogl are founders and officers of the Illinois Renewable Energy Association (IREA) and coordinate the annual Renewable Energy and Sustainable Lifestyle Fair. E-mail firstname.lastname@example.org.
From the April 2-8, 2014 issue