Lots of pundits politicians and special interests all want their idea to be the path for a new energy economy.  Lest we forget, we consumers will pay for whatever idea makes the political cut to the top.  If you are thinking the best will rise to the top – you haven’t been watching the U.S. Congress in action since the mid 60s.

Meanwhile some research is being done to assess what the possible choices might do – new energy economy or not.  One such is the Baker Institute at Rice University.  This past week saw the latest conference called ‘Energy Market Consequences of an Emerging U.S. Carbon Management Policy’ with an observation well worth noting.

Electric cars hold greater promise for reducing emissions and lowering U.S. oil imports than a national renewable portfolio standard.  No cleverness, innovation, or risks – going for as much electrified personal transport as possible as a national policy does have two outstanding attributes. The primary one is the reduction in fossil fuel use – particularly imports if the administration and congress can get themselves and their penchant for regulations and extra taxes under control.  Transport fueling could be a U.S. self-sufficient market with some policy incentives and lots less penalty. The other would be the CO2 emission reduction.

That idea is really just a capstone of many ideas that are available in a summary used during the conference that runs – more than 77 pages – available in a downloadable pdf file.  Yes its long, but with some technical exceptions much of the summary is highly readable.

The executive summary states, “As the country moves forward to deliberate on energy and climate policy, consideration must be given to what policies would best accomplish the stated goals for U.S. policy — a reduction in the need for imported oil and in greenhouse gas emissions.” The papers released at the conference seek to “clarify and debunk common myths that currently plague the U.S. energy- and climate-policy debate.”

And they do.  Given enough time transitioning the personal transport fleet to electric would have a dramatic effect on fuel use. For instance, the Baker Institute analysis found “the single most effective way to reduce U.S. oil demand and foreign imports would be an aggressive campaign to launch electric vehicles into the automotive fleet.” In fact, mandating that 30 percent of all vehicles be electric by 2050 would both reduce U.S. oil use by 2.5 million barrels a day beyond the 3 million barrels-per-day savings already expected from new corporate average fuel efficiency standards, and also cut emissions by 7 percent, while the proposed national renewable portfolio standard  would cut them by only 4 percent over the same time.

One has to suspect those numbers are a little light. 2050 is 40 years out – the flip to looking back at 1970.  It would be almost a three-fold turnover of the U.S. automotive fleet.  Getting to only 30% seems under achieving.

25 pages into the summary the authors start comparisons of various policy scenarios.  Ready for some hair to perk up?  Numerous scenarios are put to a test using a “reference case” for a benchmark and assuming no cap and trade distortions or forced renewable standards or technologies for end use.

At page 26 the nine (9) –yes nine competing policy paths are examined compared to the reference case.  Now roll in the cap and trade distortions and forcing renewables and see what happens.   It takes about 50 more pages to show the facts for the reference case and the nine policy scenarios.

Its fascinating reading – but for those of you more for getting to the point – the U.S would be best served, obviously, if she were to exploit the advantages available.  The standout is natural gas. For power generating fuels natural gas is “in hand” as there is noting other than politics keeping it in good supply.  Seems rather obvious.

But our society needs reminded to stay with the certain as the developing technology matures and becomes competitive.

The important point touched, but not shown in detail is the simple reality that cap and trade or other political devices aren’t needed.

That opens up a point for comment – the energy and fuels we use and pay for are, due to the size and vast diversity of the market a political market in the first instance both for taxes and as a means of power.

Our disposable incomes are in play.  Not just from OPEC and the Axis of Oil groups, but from special interests here at home, all seeking to extract a special rent from us.

The Baker Institute offers a breath of reality check. There can be plenty of cheap energy and fuels if we migrate in the marketplace to choosing fuels that are low cost, sustainable and that can be supplemented and eventually displaced by new technologies.

It all seems simple when summarized here – but even explained in detail it takes nearly 80 pages.  This writer suggests you download the pdf and review it as time allows.

The reassuring thing is all could be well if the politicians can be kept in check and the researchers well funded.


12 Comments so far

  1. JPK on October 4, 2010 6:13 PM

    It is not just the marketplace and consumers, in general who can do the bidding in making energy choices possible.

    newenergyandfuel.com, how can it be sure that society needs reminded to stay with the certainty as “the developing technology technology matures and becomes competitive”?

    I really suspect that growth skepticism is still at play around the globe – even in this website!

    Remember, there has to be alternatives to markets alone in solving social and economic issues that are grounded in reality, do you really understand, newenergyandfuel.com?

    More on that soon.

  2. JPK on October 4, 2010 7:29 PM

    And one thing: You quoted on October 4 (October 5, Philippine Time) that “transport fueling could be U.S. self-sufficient market with some policy incentives and lots less penalty”.

    What you should know, though, that energy choices are being corrupted by a belief in growth cynicism that may be conspired to be at work but never gained attention to the wide public about the realities of this sort of philosopical & ideological phenomenon.

    While it is nice to know, newenergyandfuel.com, that markets do influence people’s choices, especially when it comes to energy & mobility choices, markets alone may not be sufficient in understanding the perils of various forms of growth skepticism.

    There needs to a political case for a transition from a market economy to a better form of an economic system. newenergyandfuel.com, you are missing the point on the issues affecting energy and mobility choices. So now what? I shall find out soon.

  3. Matt Musson on October 5, 2010 7:58 AM

    There is no alternative to the market. That is like saying there is an alternative to gravity.

    However, markets can be incentivized.

    But, the electric car will never be successful until it provides a convenient and cheap alternative. If I can’t drive from Charlotte to Raliegh for the weekend (and back), it does not fit my life style.

    The only reason we use fossile fuels is because they store a lot of energy in a compact, easy to use and relatively cheap medium.

  4. JPK on October 6, 2010 4:05 PM

    Can the markets incentivise the mindsets of the people for supposedly valid reasons? Please think about it.

    It is important to assess the alternatives to markets (and discuss meaningfully) before making the case for a particular social and economic principle.

    Do not forget what you must do about the realities the interantional economy is facing right now. Thank you.

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    to be honest this is what alot of people agree on and some people take it as a joke and for some one like me

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