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Knight-Ridder: Oil Independence is possible, but does America want it bad enough?
Feb 27, 2006 (From the CalCars-News archive)
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This story appeared different days in different papers of the national Knight-Ridder never made it into the print edition of our hometown San Jose Mercury News.­mld/­mercurynews/­news/­politics/­13926319.htm
Oil independence is possible, but does America want it bad enough?
Posted on Tue, Feb. 21, 2006
Knight Ridder Newspapers

WASHINGTON - President Bush's State of the Union pledge to end America's oil "addiction" and his tour of emerging energy technology centers this week have touched off a national debate on how to achieve energy independence.

"The answer is pretty simple. We will never get to energy independence while we are using oil as the major fuel," said Severin Borenstein, director of the University of California Energy Institute in Berkeley.

There are ways to break America's oil addiction, experts say, but it won't be easy. Cures include stricter conservation, higher fuel-economy standards, alternative fuels made from common crops and next-generation batteries for hybrid cars that could get more than 100 mpg.

These and other options are promising, but all would require sacrifice and trade-offs. And, importantly, none are yet cost-competitive with oil. That's the biggest challenge to escaping America's oil-based economy. Although growing global demand has strained supplies, oil remains widely available and relatively cheap, even at today's high prices.

In November 1973, President Richard Nixon announced "Project Independence" to end U.S. reliance on foreign oil by 1980. He asked William Hogan to help lead the crusade. Hogan spent the ensuing energy crisis years as deputy director of the forerunner to today's Department of Energy. But Americans are now more dependent than ever.

Here's what Hogan thinks of Bush's pledge to end America's oil addiction:

"My honest reaction was I wish he hadn't said it."

Hogan believes energy independence is illusory. Oil remains the world's most cost-efficient fuel and is likely to remain so indefinitely. The real goal, he believes, should be reducing Americans' vulnerability to price and supply shocks.

The problem is "there's still all this oil in the Middle East" said Hogan, now a Harvard University professor. Because the Middle East is home to most of the world's proven oil reserves, it's expected to remain the low-cost oil producer for decades. And oil is likely to be the fuel of choice as long as it remains cheaper than alternatives, Hogan said.

If America went cold turkey, it would mean switching to higher-priced or heavily subsidized alternative fuels, which Americans and the government have resisted since Ronald Reagan won the presidential election in 1980.

And there's still the question of how quickly the nation could replace the 136 million gasoline-powered cars that cruised America's highways in 2004, the latest year Federal Highway Administration data are available.

During his State of the Union address, Bush called for reducing three-fourths of the oil that the United States purchases from the Middle East by 2025. A day later, his energy secretary clarified the goal - it's actually to reduce oil imports from anywhere by the equivalent of 75 percent of projected Middle East imports.

The Energy Department projects that Middle East oil imports will total 6 million barrels per day in 2025, so Bush's goal means displacing 4.5 million barrels a day by then.

That's more like a bartender taking away the glass but leaving the bottle. The United States would still be consuming nearly 23 million barrels per day of oil, and about 13 million barrels a day would come from abroad.

Bottom line: Under Bush's approach, America would remain addicted to foreign oil and still vulnerable to price shocks in a global market.

The surest way to break oil addiction is to make gasoline much more expensive. High gasoline taxes have helped Europe discourage consumption and promote more fuel-efficient cars.

In that vein, Americans for Energy Independence proposes a gradually rising import energy tax. The revenue it would generate "would be used for incentives to spur the move to plug-in hybrids (gas-electric cars) and a national bio-fuels campaign," said Chris Wolfe, the group's president.

Logical, perhaps, but likely?

"That's a non-starter, not just with Republicans but Democrats," said Borenstein of the University of California. He doubts that politicians have the stomach to impose a so-called "sin tax" on oil.

California may soon test that. A signature drive is under way there for a referendum on taxing oil to create incentives for alternatives.

Another option is to sharply increase mileage standards for new cars. During the 1970s, Congress imposed standards on carmakers, and fuel efficiency for passenger cars jumped from an average 12.9 mpg in 1974 to 27.5 mpg in 1985. The requirements for cars haven't been raised since, and they're lower for trucks, including SUVs.

The nonpartisan Congressional Budget Office said in 2004 that raising minimum mileage requirements for cars to 31.3 mpg could reduce gasoline consumption by 10 percent. But, the CBO warned, that would increase the average car price by $900.

The CBO said a 10 percent cut in gasoline consumption could be achieved at lower cost by raising the gas tax. The last time the gas tax was raised was in 1993, when President Clinton persuaded the Democratic-led Congress to increase it by 4.3 cents per gallon. But Republicans blasted the tax hike and Democrats lost control of Congress in the 1994 elections.

The Rocky Mountain Institute, a Snowmass, Colo.-based energy research organization, offers a blueprint on how to attain oil independence by 2025. Its 2004 book "Winning the Oil Endgame" said U.S. oil consumption could be halved by 2025 with alternative fuels and conservation measures.

The institute recommends making cars from lightweight materials such as carbon-fiber composites. It also suggests "feebates," which combine steep fees on vehicles with poor gas mileage and government rebates for fuel-efficient vehicles. Owners of gas-guzzling SUVs would pay fees, while drivers of gas-electric hybrids or vehicles running on ethanol would get tax rebates.

"To achieve this does not require a revolution, but merely consolidating and accelerating trends already in place," wrote Nathan Glasgow and co-authors.

Bush's proposals spotlight two alternatives to gasoline: new battery technologies for electric cars and mass production of enzymes that convert plant fiber into ethanol fuel.

Consumers are snapping up hybrid cars by Toyota, Ford and Honda. Those cars have two motors, one powered by gasoline, the other electric. The gasoline motor recharges the battery. The cars achieve roughly double the mileage of a gasoline-only engine.

Some 200,000 hybrids were sold last year, about 1.2 percent of the 17 million cars sold in the United States.

The next big thing is expected to be plug-in hybrids whose batteries are recharged by the gasoline motor, but also can be plugged into any 120V electrical outlet for charging. Once perfected, these stronger batteries could achieve 100 mpg or more.

"You're substituting electricity for gasoline - that's the big benefit," said Felix Kramer, founder of CalCars.Org, a nonprofit in Palo Alto, Calif.

CalCars believes that if all U.S. vehicles in 2025 were hybrids, and if half were plug-ins - two big ifs - U.S. oil consumption could fall by 8 million barrels a day, or 30 percent. Hybrids that run on alternative fuels could cut oil consumption even more.

Bush also backs cellulose-to-ethanol technologies. Corn-based ethanol production is expected to reach 6 billion gallons next year; researchers estimate a maximum production potential of 15 billion gallons per year. That's about 12 percent of the projected 120.4 billion gallons of gasoline that the Energy Department estimates Americans will consume annually in 2025. Hardly independence.

But mass production of biologically engineered enzymes that can break down virtually any plant fiber for conversion to ethanol offers hope. Add these to the mix and suddenly ethanol's production potential leaps to 100 billion, approaching levels needed for independence.

"I think it's very doable. But it depends on whether policymakers provide the incentive to get it done," said Georg Anderl, director of operations for Genencor International, a Palo Alto, Calif.-based biotechnology company.

No one has built a costly large-scale commercial bio-refinery. Anderl believes the industry is waiting for Washington to help.

"What we need to have is a system-level integration of all the technology that's needed ... to make ethanol from crop waste. ... What's going to be required is government funding to really provide the impetus and bring that together," he said. "No one company is going to do that alone."

Even then, huge infrastructure hurdles would remain. Currently, fewer than 700 filling stations nationwide sell ethanol. More than 167,000 sell gasoline.

Infrastructure hobbles another hope: hydrogen fuel cells. A few years ago, hydrogen was viewed as the heir apparent to gasoline. Hydrogen-powered cars rely on electric motors powered by fuel cells that store pressurized hydrogen.

Experts believe it could take up to 20 years before hydrogen fuel _cf_s are affordable and reliable enough to market. Then there's the challenge of building a national distribution system, because liquid hydrogen must be stored at temperatures under minus 400 degrees Fahrenheit.

With so many obstacles to energy independence, Jens Mueller Belau, Shell's global technology manager, thinks gasoline will still dominate 20, 30, even 50 years from now.

"However, the diversity of fuels will be growing in the next few years," he said.

Shell's U.S. fuels marketing manager, Dan Little, says all the emerging alternatives will help reduce America's dependence.

"If you put them all together, they're all going to play an important role in overall fuel solutions," he said.


For more on President Bush's Advanced Energy Initiative go to:­infocus/­energy/­

For a PDF version of "Winning the Oil Endgame" go to:­

For more information on Plug-In hybrids, go to:­

For more on cellulose-to-ethanol technology, go to:­resource/­cellulosic/­

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