by Steve Brick, Senior Fellow, Energy and Climate, The Chicago Council on Global Affairs
President Obama is coming to Argonne National Laboratory in Lemont, Illinois, on Friday, March 15, and he is expected to talk about energy policy. For more than four decades, we have heard US Presidents call for national energy policy, make grave declarations about the urgent need for change, and chart bold courses to effect that change. We have also, invariably, seen these bold plans founder on the shoals of political intransigence, economic short-termism, and public apathy.
Here are two suggestions for concrete things the President can do to encourage innovation, improve energy security, and take meaningful steps to reducing greenhouse gases.
1. Approve the Keystone XL Pipeline
President Obama should approve the construction of the Keystone XL pipeline. Opponents to the pipeline are disappointed by the lack of progress on international and national climate policies. For this group of dedicated activists, Keystone XL is a symbol of the battle to save the planet from runaway climate change. But every energy policy decision must balance competing objectives, and in this case, the balance tips in favor of the pipeline.
American public opinion also tips in favor of the pipeline. Quinnipiac, Gallup, and Fox News surveys have found about two in three Americans support the building of the Keystone XL pipeline, even when wording is included that points to potential environmental risks.
The US transportation sector still runs on oil, and will for the foreseeable future. Canada is our largest and most politically stable trading partner, and fostering that relationship is good for both countries. Construction jobs will be created as the 800-plus mile pipeline is built. Jobs in US refineries will be protected as volumes of Canadian oil increase.
Pipelines are the safest and most cost effective means of moving crude oil to refineries. At present, because of insufficient pipeline capacity, millions of barrels of Canadian oil are moving to US markets via rail, a mode of transportation at risk of derailment or spillage.
Denying the construction application would yield an environmental victory that is wholly symbolic; Canadian oil will continue to make its way to US markets, that oil will be refined and burned, and earth’s climate situation will not be one whit less perilous. We should not waste civic energy and political capital on purely symbolic fights; there are more tangible battles to be fought and won.
2. Leverage the Natural Gas Bonanza
A better use of civic energy and political capital would be to develop a national strategy for capitalizing on the current natural gas bonanza. Shale-gas has improved America’s energy picture. It has made natural gas more abundant and less costly. It has driven down carbon dioxide emission as natural gas displaces coal in the nation’s electric power plants. While Americans tend to favor the development of alternative energy sources, polls show that when asked specifically about natural gas, majorities support expanded exploration and offshore drilling (despite a dip in the wake of the Gulf oil spill). That said, a majority also supports stronger enforcement of federal environmental regulation (Gallup).
But, the revolution is proceeding with Schumpeterian destructiveness that could shorten its life and undermine its potential benefits. The revolution needs to be guided by careful policy support.
First, the nation needs a unified approach to the environmental review and permitting for new natural gas wells and associated infrastructure. The state-by-state patchwork that is currently evolving is not good for any concerned party, whether environmentalist or business. A Federal lead on this effort, with model regulations emanating from a carefully convened group of stakeholders, would help create an orderly, protective and transparent regime.
Second, we need to develop and deploy carbon capture and storage (CCS) technology for the natural gas-fired power plants. Department of Energy studies suggest that we can build a natural gas-fired power plant with CCS for less than the cost of a new coal-fired power plant. The world is not going to swear off fossil fuels anytime soon, and we urgently need technologies for managing fossil carbon emissions. While US coal consumption may be declining, global coal consumption is on the rise. Developing the CCS technology for natural gas power plants would pave the way for CCS on coal, and create a pathway for managing the growing coal-related emissions of China, India and other rapidly industrializing nations. The Federal government should develop and underwrite a 5-year program to bring this critical technology to maturity.
The Environmental Protection Agency is now considering regulations that would impose carbon dioxide standards on existing fossil power plants. Given the projected low cost of natural gas power plants, this is an ideal time to enact policies that would encourage turnover in the US power plant fleet. Such a policy should give power plant operators ample time to make smart retirement decisions and to plan for adding replacement capacity. In addition, the government and the states should consider whether temporary economic incentives are needed or appropriate to drive this shift. This policy would yield significant carbon reductions at modest cost, and represent meaningful progress on climate policy.
By taking these actions, the President can demonstrate his commitment to balancing energy economics, security and environmental concerns, and ease the country further through the energy transition that is both necessary and unavoidable.
Steve Brick, senior fellow on energy and climate, joined The Chicago Council on Global Affairs in 2009, providing broad experience having worked for thirty years at the intersection of energy and environmental policy. His previous positions include environment program manager for The Joyce Foundation, associate director of research for the Energy Center of Wisconsin, director of environmental affairs for PGE National Energy Group, science and policy director for the Clean Air Task Force, and cofounder and vice president of the energy consulting firm MSB Energy Associates. Mr. Brick received his B.A. and M.S. from the University of Wisconsin-Madison, where he studied at the Gaylord Nelson Institute for Environmental Studies.
For more information on energy in the Midwest, including Chicago Council Survey results on “American Views on Climate Change” and “American Views on Energy Policy,” visit The Chicago Council’s webpage on Energy and Midwest Economic Competitiveness and the blog Running Numbers, authored by Dina Smeltz, senior fellow on public opinion and foreign policy.
Recent Comments