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O is for Oil

What every American needs to know about our energy conundrum

HOW SILLY WE AMERICANS can be when it comes to energy. In a new series of TV ads produced by the Environmental Protection Agency, inept consumers are shown trying to improve car fuel efficiency and cut emissions via absurd home-built devices. In one, an embarrassed wife watches as hubby tries to convert the family car to sail power; she then tells us that houses are bigger sources of energy waste and emissions than cars, and explains how she is buying new, more efficient appliances.

Ostensibly, these ads are meant to educate consumers by pointing out that, for all the talk about SUVs and automotive efficiency, the average home produces twice as much greenhouse gas emissions as the average car. Message: America is better off focusing its cleanup efforts on homes, not cars.

This is, to use the technical term, a load of hokum. Yes, houses are major sources of energy waste and carbon dioxide: At least 15 percent of all CO2 emissions in the United States come from residences, or from the power plants that supply them, and yes, the average house produces twice as much CO2 as a car. But as the EPA knows full well, the average American family drives 1.9 cars, and so the disparity vanishes. Moreover, it's simply easier for consumers to cut emissions and fuel consumption in cars than in homes. Hybrids, for example, may be expensive, but buying one cuts fuel use and emissions by half instantly. Getting similar reductions in your home requires not only new appliances, but new windows and other, more expensive improvements.

The EPA is hardly the only source of muddled energy information. In recent months, we've heard fuzzy energy logic from nearly every corner of the political spectrum. John Kerry blames President Bush for not doing enough to lower gasoline prices, when no president can control oil markets. Bush, meanwhile, has been deflecting criticism of his own do-nothing energy policy by promising a brave new "hydrogen economy" -- even though hydrogen won't be ready for prime time for 20 years.

Yet what is truly disturbing is that most Americans don't see through such rhetoric. For all the energy we use, and the importance of energy to our economic and political power, Americans are, by and large, energy illiterates. Few of us know how energy is produced, or where it comes from. More seriously, few of us know just how much pressure our global energy system is under. We have no idea how challenging it has become to produce adequate supplies of oil and other energy sources, or how urgently weneed to begin migrating to cleaner energy technologies and fuels -- or how difficult such a change will be.

How did we become such dim bulbs on energy? The simple answer is, we can afford to be. Americans are wealthy, and energy is, on average, cheaper now than at any time in history. Our energy technologies are so advanced that in most cases the act of consuming energy is almost invisible: We turn a key or flick a switch. In developing nations, where the energy "system" is often fueled by wood or dung that must be gathered by hand, citizens are intimately and painfully familiar with every calorie of energy they expend and work hard to conserve. But here in America, we rarely actually see energy consumption as a distinct -- or changeable -- action.

Gasoline prices, for example, get a lot of press, but when it comes to choosing a new car, fuel costs actually rank well below such factors as sticker price, convenience, performance, or even number of cup holders. As one auto industry analyst put it, "When I pay $20,000 or $30,000 or $40,000 for a vehicle, I'm not that worried about 50 cents or a dollar more for a gallon of gas."

Or consider household appliances. In most cases, the more expensive the model, the higher its energy efficiency -- and thus, the lower its lifetime operating costs. In Europe, where energy is much more expensive, consumers are extremely mindful of operating costs. But here in America, consumers consistently buy the cheaper appliance, even though the extra cost of the more efficient model would be more than paid back by its greater efficiency. Such willful ignorance is one of the reasons that American energy consumption is rising steadily -- and putting an ever-greater load on the global energy system.

How might America cure itself of energy illiteracy? Realistically, teaching Americans to give energy the priority it deserves would be an incremental process that could take years. But to get the process started, here are five things that every American should know about energy.

America has little short-term control over oil prices.

Yes, prices have softened somewhat in recent weeks on news that the Saudis are pumping and shipping more oil, and this week's transfer of sovereignty in Iraq sparked a further decline in crude prices. But the larger oil picture is still unbalanced. Rapidly rising demand in places like India, China, and, yes, America, is sucking up any extra oil almost as fast as the Saudis and other producers can get it on line -- which means that, barring some huge drop-off in oil demand (due to an economic downturn, for example), upward pressure on prices will continue. True, America could release some oil from its Strategic Petroleum Reserve (as John Kerry called on George Bush to do last month) and possibly bring prices down. But the reserve is a finite resource and the effect would be limited. In other words, as long as America does nothing to cut its oil demand, we will be hostage to the oil market.

In an energy system dominated by oil, energy security is a myth.

No matter how quickly oil production can be raised in postwar Iraq, Saudi Arabia, Russia, or anywhere else, the United States will always be vulnerable to supply disruptions. We consume more than twice what we produce at home, and that won't be changed much by drilling in the Arctic National Wildlife Refuge or other currently off-limits domestic fields. Instead, we're forced to rely increasingly on foreign producers, who may supply 70 percent of our oil by 2020. This is hugely dangerous. The world's biggest oil suppliers also happen to be some of the least stable countries. Saudi Arabia, Iran, Iraq, Venezuela, Nigeria -- all are candidates for civil turmoil, which could disrupt our access to oil. Even Russia, our new oil buddy, is far from stable. America could attempt to enforce stability through diplomatic or even military intervention. But as our problems in Iraq demonstrate, that is a limited strategy. Even the mighty United States cannot guarantee stability in the oil regions of the world -- and, thus, cannot ensure an uninterrupted supply of oil.

Our energy problems are much larger than advertised.

To the extent that Americans even acknowledge an energy crisis, most of us see it in terms of the price of gasoline or heating fuel. These are only the tip of the iceberg. Worldwide, demand for energy of all kinds -- oil, but also electricity -- is stretching our capacity to produce it, and this dynamic shows little sign of letting up. World population will nearly double by mid-century. Yet since most of that growth will come in developing nations, world energy demand will actually rise geometrically, because many of these newcomers will need to double, triple, or even quadruple their current per capita energy consumption simply to reach a decent living standard.

All told, the world will need about four times the energy "services" we use today, which is almost impossible to imagine without using fossil fuels. And that's the good news. The bad news is that, if we're to have any hope of slowing climate change, by 2050 we must be generating only one-quarter of the CO2 that we emit today -- a reduction that may be all but impossible if we're still using fossil fuels, or at least using them in the way we do today.

No single magic bullet will solve our energy crisis.

Too many Americans believe that the only reason we're not using cleaner alternatives, like wind or hydrogen, is that energy companies don't want us to. This is the populist version of energy illiteracy. Yes, energy companies will fight hard to guard their investment in the status quo. But it's also true that most energy alternatives can't yet compete with fossil fuels.

The hydrogen economy looks good on paper. But fuel cells are still hugely expensive and unreliable -- and we'd still need a way to make the hydrogen, which, unlike oil, isn't just waiting underground. Sure, we can refine hydrogen from natural gas, but then we need a steady supply of natural gas. Hydrogen can be refined from water, but that process requires huge inputs of electricity.

This no-free-lunch rule applies to all energy alternatives. For example, while ethanol brewed from cost-effective crops can replace gasoline in the short-term, it still releases CO2. Solar and wind power are emission-free, but face their own downsides. One is power density. While a chunk of coal packs lots of energy into a small volume, wind and solar are rather dispersed. Thus, where a coal-fired power plant capable of powering a small city takes up only a few hundred acres, a wind-farm of the same capacity would require hundreds of square miles. Ditto for solar.

There is no substitute for conservation.

New energy technologies will continue to get cheaper and more convenient. (Thin film solar cells, which can be applied to windows and roofs, are a particularly exciting prospect.) But to delay changing our energy consumption now in the hopes of some killer app tomorrow is sheer folly. In the first place, we have no idea how long we'll have to wait. Second, we can almost guarantee that whatever the next energy technology is, it won't have the power density of coal or oil -- and thus won't be able to simply duplicate what coal or oil are doing today. In other words, as we prepare for the inevitable transition away from fossil fuels, we need to begin dramatically reducing the amount of energy we use -- ideally, by finding ways do what we do today but with less energy.

. . .

Which brings us back to cars. By 2020, we may indeed have a reliable, cost-competitive hydrogen fuel cell that uses energy twice as efficiently as a gasoline engine. But that efficiency gain would be largely negated if we're using that fuel cell to pull a five-ton SUV. Instead, by 2020, we'll need to be building lighter, more efficient cars that only need a third to a quarter of the energy required today. True, it isn't just cars. We'll also need to cut energy demand in offices, factories, and, yes, homes. But despite what you might hear from the EPA, the car is probably the best place to start, because it offers a way not only to quickly cut emissions, but to begin reducing our demand for oil.The EPA knows this, of course. And perhaps, in a few years, the average American will, too.

Paul Roberts is a journalist living in Washington State. His book "The End of Oil: On the Edge of a Perilous New World" was published in May by Houghton Mifflin.  

The ad can be viewed here
A new series of public service announcements, produced by a branch of the Environmental Protection Agency dedicated to home and office energy conservation, mocks the idea of trying to make cars more energy-efficient.   Video The ad can be viewed here
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