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Energy Abundance vs. Energized Politicians

12:00 AM, Oct 13, 2012 • By IRWIN M. STELZER
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We are entering an age of energy abundance. Or not. In keeping with the great tradition of economics, dubbed by Thomas Carlyle the dismal science, let me raise a cautionary note. What God has showered upon us, politicians can make unavailable. Not only because they have to balance our need for energy supplies adequate to support economic growth against the need to prevent unnecessary damage to the environment. More important from their point of view, they have to try to appease voters who want both cheap energy, which means coal, and greener sources that are more costly.

Oil Rig

Start with coal, a fuel that damages the earth surface when removed by strip-mining, causes deaths when removed from underground mines, and pollutes the air. Coal now fuels about 40 percent of the world’s energy production, which is rising rapidly—at the rate of one Brazil per year according to Robert Bryce, a senior fellow at the Manhattan Institute, a think tank. America styles itself “the Saudi Arabia of coal,” and with reason. A single mine in Wyoming produces three tons of coal per second, and we sit on enough coal to last us for 250 years.      

But America is at a turning point. If President Obama is reelected, it is certain that there soon will be no new coal-fired electricity generating plants built in the United States. If the Romneys take up residence at 1600 Pennsylvania Avenue, the new president will do all he can to relax restrictions on the mining and use of coal, and encourage development of clean coal technology. The danger posed by a Romney administration is that it might become excessively responsive to the “drill, baby, drill” crowd, which is not famous for its sensitivity to legitimate environmental concerns.

In any event, whatever American policy toward the use of coal turns out to be, it will matter very little to global emissions levels, since use of coal by emerging nations will continue to rise, most especially in China and India, as their need for more and more relatively cheap electricity soars, with a consequent worldwide increase in CO2 emissions. Bryce writes in his think tank’s City Journal, “Over the past decade, even if American emissions had dropped to zero, global emissions would still have increased.” Of course, just because you can’t do everything doesn’t mean you should do nothing, but if the cost of depriving us of use of our coal resources is to reduce emissions, it is a feckless enterprise if the cost of that self-denial is high. 

Natural gas is the other fuel with which America is amply endowed. New technologies are making vast amounts of shale gas available, driving prices so low that it is now cheaper than coal and, some say, is likely to remain so. The Department of Energy reports that in the first half of this year natural gas used for electricity generation rose 32 percent while coal usage dropped 18 percent. Despite soaring domestic consumption of natural gas, supplies are so plentiful that there is a multi-billion dollar rush to build terminals for exporting the stuff, and even to convert some import terminals to export facilities.

That has brought howls of anguish from the petrochemical and other industries that want to keep this cheap fuel at home, rather than make it available for overseas competitors. Meanwhile, environmentalists are girding for a battle to stop “fracking,” the new technology that makes shale gas economically available. In New York State, Artists Against Fracking, a group led by Lady Gaga, Paul McCartney, and Yoko Ono, has put its celebrity power—if you want television coverage of your congressional hearing, Lady Gaga is a surer bet than an environmental scientist of a coal company executive—behind environmental groups to force Governor Andrew Cuomo to review his decision to allow local counties, more desperate for new jobs than the celebrities, to give fracking the go-ahead if they find it is not a threat to their water supply. Best guess is that fracking will proceed very slowly if at all in the Empire State. And it is not a guess but a certainty that the Obama E.P.A. intends to get into the fracking regulation act, and not with the intention of speeding the development of shale gas resources. Environmentalists fear that the replacement of coal with natural gas will reduce emissions so much that enthusiasm for renewables will wane.

So adding shale gas to coal as environmental villains suits the Obama administration, as do restrictions on the storage of nuclear waste, and permitting policies that retard the development of America’s oil resources. The goal is to turn the energy economy green, heavily reliant on wind and solar power.

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