Thought Experiment: What if global warming and resource limitations didn't exist? A way to move the energy policy debate forward.

Today I was listening to a podcast about US energy policy and what should be driving it. Climate change? Energy independence? Resource scarcity? National security? Job creation? This is something I've thought about at length before, and it inspired me to organize my thoughts and write it down. The question I framed to myself: How might the majority of Americans be able to unite behind a common cause that would build a solid foundation for reforming and progressing our nation's energy culture? The following is a basic stroll through my thought process.

I first thought about the polarizing arguments in the debate. Let's face it - the majority of climate scientists tell us the data shows global warming exists and that humans are at least partly to blame. Yet there is a very loud minority of people who believe climate science is wrong - either that humans are not to blame for global warming, or that global warming doesn't even exist. This is definitely a polarizing argument in the debate. So let's remove it. Let's assume that those who challenge global warming science are right. Let's assume we are in an alternate dimension where no one has ever heard of global warming, or if they have, it's not caused by humans so there's nothing we can do about it.

What else can we remove? Resource Scarcity. While I'm not sure of the exact numbers, it appears that the majority of fossil fuel resource analysts are predicting that peak oil has already occurred, is imminent, or will soon occur within this decade. Further, other fossil fuel resources will also inevitably reach a peak within the next generation or two. On the other side of the debate, there are those who believe resources will not run out as soon as projected, or that we'll continually be able to make new resource discoveries to carry us into the future. So let's remove this argument, too. In our alternate dimension, peak oil is a non-issue, at least another 100 years away.

So now we are in this alternate dimension where global warming and resource scarcity do not exist. How would our society's attitudes and policies toward energy use be different? How would it affect the energy policy debate?

In this dimension, there are still problems with the current energy culture. We still consume and import too much oil, which still supports an unhealthy trade deficit and makes us reliant on some countries with whom we might not otherwise be so friendly. This vulnerability is still a hot button issue in national security circles where energy independence is identified as a mitigation strategy to reduce the impact of risks similar to the 1970s oil embargo. And the oil is still combusted, contributing to smog and air pollution (and a lot of greenhouse gases, not that it matters in this dimension). Also, dirty coal still supplies 45% of our nation's electricity. This also still greatly contributes to air pollution and affects the health of every citizen downwind from a coal power plant. And coal is still stripped from mountain tops, creating huge amounts of water pollution and habitat destruction, and also negatively affects the health of every citizen downstream. Oh, and energy prices still widely fluctuate depending on supply & demand, wars, natural disasters, and speculators. Overall, this dimension has a familiar set of energy problems that need to be overcome, and are no less urgent than the ones we really face today.

What are the best ways to overcome these problems? How can this dimension achieve energy independence, reduce air and water pollution, and stop the destruction of common lands? A nice thing about these problems is that there is little debate that these problems exist - regardless of dimension! So people can move foward and decide what strategies to implement to resolve these problems.

So here is the first answer in my thought experiment. Perhaps the best way to move our nation's energy policy debate forward may be to drop the primary arguments for change. If we stop proclaiming that urgent change is needed because of climate change and resource scarcity, we can still proclaim that urgent change is needed to achieve energy independence and reduce air and water pollution - and the latter arguments are ones that a majority of people can unite behind.

Next I wanted to think about the effects on policy in the this dimension without global warming and imminent resource constraints. What are ways to achieve energy independence and significantly reduce air and water pollution?

First we have to quantitatively define success. The higher our degree of energy independence, the lower our risk to national security and foreign influence. A reasonable measurement of energy independence would be to determine how much of our energy supply is sourced domestically - any imported energy (oil, gas, electricity, biofuel, etc.) is not sourced domestically. Should we have a goal of 100% domestic energy sourcing? 95%? 90%? That's something our countrymen and countrywomen in this alternate dimension have to decide. As a baseline, it's interesting to note that the US is actually about 70% self-reliant on energy today [1].

Most imported energy is in the form of oil. And most oil is used in transportation. So the vast majority of heavy lifting to bring our energy independence score closer to 100% is to focus on transportation. We can affect the demand curve by reducing the number of miles we drive, increase energy efficiency, use alternative energy sources (i.e. batteries, domestic biofuels), or a combination thereof. We can affect the supply curve by increased domestic and offshore drilling - and note that just because this alternate dimension has no peak oil in sight doesn't mean that there can be an oil spigot in everyone's back yard. The US still has only have 3% of the world's oil reserves, in the same locations they are now.

In this alternate dimension, then, there would likely be a debate about whether to encourage more drilling, increase conservation, increase efficiency, or research and develop non-fossil fuel technologies. With a reasonably sized budget, we will likely end up funding them all. Of course, the fossil fuel industry has a cost advantage of being relatively inexpensive and mature technology, so subsidies for drilling aren't necessarily  needed to maintain profitability and relatively low gas pump prices. Thus, I think it's reasonable to assume that increased extraction efforts can proceed without government subsidies. Also, converting all of our foreign oil to domestic would not change the pollution problems that are still an issue. (And not just air pollution - think Deepwater Horizon, or fracking). Therefore, it seems reasonable that the focus of our collective tax money should be used to invest in efficiency and alternative energy technologies that are more environmentally sustainable over the long run. We can also brainstorm some creative conservation incentives that can be applied to commercial and personal transportation (e.g. encourage telecommuting, compressed work weeks, laddered gas prices that increase with increased consumption).

How can this alternative dimension measure and decrease energy-related air pollution? Criteria air pollutants are defined by the EPA as: particulate matter, ozone, carbon monoxide, sulfur oxides, nitrogen oxides, and lead. Hydrocarbons are also measured in automotive emissions.

Today's average auto emissions have vastly improved since regulations began in 1966. An average unregulated vehicle in 1966 had a combined emissions of nitrogen oxides, hydrocarbons, and carbon monoxide of 102.1 grams per mile [2]. Today's LEV II standard in California mandates a combined emissions of less than 4.36 grams per mile, or about 96% less emissions. That's a pretty good improvement. Of course, our city's smog and pollution problems are not gone, so more can be done. To further decrease pollution from vehicles, we might choose to enforce even more stringent restrictions on a grams per mile basis, or maybe place a tax on these pollutants. The tax could be paid by the manufacturer for the life of the car, or by the consumer based on the smog rating of the car and the number of actual miles driven in a year. This would encourage consumers to purchase more energy efficient and cleaner cars, and encourage manufacturers to produce these cleaner cars.

In 2009, America got 44.9% of its electricity from coal, 23.4% from natural gas, and 1% from oil, or 69.3% from fossil fuels [3]. Similar approaches as above could reduce pollution from electricity production, and since it's much easier to measure pollutants from these stationary sources, more opportunities for creative policies exist. Strict restrictions, taxes, or cumulative caps on specific pollutants emitted per MWh of electricity can be considered, although it may have to be technology-specific. It would also be unfair for some geographies to be overly burdened just because they lack abundant renewable resources. Decreased pollutants can be achieved by catalytic scrubbers and filters, increasing energy efficiency, or by developing non-fossil fuel sources. A related thought: Our states place large taxes on cigarettes because they emit pollutants that cause severe health problems to exposed persons - couldn't we reasonably tax coal for the same reason?

To reduce water pollution from fossil fuel extraction, our we can consider targeted restrictions on mountain-top coal mining, offshore drilling, and fracking operations.

The demand size of the equation can also be influenced to reduce pollution. To discourage ever-expanding electricity consumption, utility revenues can be decoupled from the amount of electricity consumed. Energy efficiency can be increased. Various NPV-positive efficiency projects have been identified. Further increases in efficiency can be achieved by subsidizing efficiency projects that are less profitable or have a longer payback. For example, the energy required for space heating in this country could be drastically reduced by the widespread adoption of geothermal heat pumps for both residential and commercial buildings. Since these systems have large up-front costs and potentially longer paybacks, a policy could be implemented to subsidize installations on a regional basis such that they have an average payback of less than 5 years. Research grants for developing reduced-cost drilling/excavating operations for pipe placement could also be considered.

In this alternate dimension without global warming or peak fossil fuels, the nation would still need government policies to focus on

• further restricting emissions from internal combustion engines
• encouraging more efficient or alternative energy transportation technologies
• increasing energy efficiency in buildings and industry
• cleaning emissions from fossil fuel-based electricity generation
• encouraging electricity generation from non-fossil fuel sources 
• enforcing cleaner methods for extracting fossil fuels  
• incentivizing energy conservation behavior 

Coming back to reality now, this list appears very similar to those strategies adopted to combat climate change and resource scarcity. But a comprehensive national energy policy can't seem to get traction because people are too busy fighting over the reasons why need to make changes. It doesn't seem very far-fetched that we could get a majority of Americans (and their representatives in congress) to agree that we need to achieve true energy indepedence and reduce air and water pollution from energy extraction and use. If we can agree on that and implement strategies that move us toward achieving those goals, we will still make great progress toward decreasing greenhouse gas emissions and reducing our appetite for dwindling resources. And if the climate scientists and resource analysts just happen to be right, then our efforts will provide benefits to overcome those challenges, too.


[1] Yergin D, The Fundamentals of Energy Security, Testimony to the House of Representatives, 22 March 2007, http://foreignaffairs.house.gov/110/yer032207.htm
[2] Chen et al, 2004, http://pubs.its.ucdavis.edu/publication_detail.php?id=200
[3] EIA, http://www.eia.doe.gov/cneaf/electricity/epm/table1_1.html