Commentary by Pete du Pont
July 01, 2013
Source: The Wall Street Journal
Not surprisingly, President Obama and Speaker John Boehner have different views on energy policy, differences brought into stark contrast by their recent statements. The president sees our nation’s energy policy primarily in terms of the environment, with the economy a secondary concern. His policy is grounded in a view that government regulation and subsidies can steer us to better and cleaner energy.
On Tuesday the president unveiled plans to increase regulation of coalfired electricity plants, erect new hurdles to building the Keystone pipeline, and further the federal government’s role in trying to pick winners and losers in energy sources.
Mr. Boehner calls energy “one of our best opportunities for robust and sustained growth . . . our new economic frontier, just as the Internet was in the 1990’s.” This debate’s timing could not be more appropriate, because the right energy policy could be the catalyst needed to inject some growth into our weak economy and raise standards of living, not just in this country, but across the world.
We see significant progress across the energy spectrum. On the supply side, there are new approaches to developing and scaling up renewable energy, as well as safely and economically extracting energy from natural gas, oil and coal. This progress often happens in spite of government policy. The boom in natural gas production, stymied on federal lands, is happening on private property.
The demand side is equally encouraging. Overall worldwide demand continues to increase, but that’s a sign of a successfully growing world, with more schools, hospitals and jobs, and less poverty, disease and premature death. New and more efficient technologies allow us to feed this beneficial growth more effectively. In the U.S., energy consumption per dollar of real gross domestic product has declined almost a third in the past two decades and is projected to decline another third over the next two decades.
The domestically sourced share of our energy consumption is rising, and this trend is expected to continue. Advances in extraction technologies such as hydraulic fracturing and horizontal drilling have yielded continued gains in production of oil and natural gas. We see continued efforts in cleaner coal, which is important since coal is currently used to generate around 40% of our electricity and we have enough to supply 200 years of demand.
While fossil fuels will be our primary energy sources for several decades, we need progress in renewables so they can eventually supplant today’s fossil fuels. Again, we see good news. Look at just one recent issue of Popular Science, where we see more efficient solar and wind technology and a possible non-battery alternative for the energy storage critical for such renewables. Other promising technologies include energy from waste, fueling nuclear plants with spent nuclear fuel (instead of having to store such waste), using heat generated from industrial processes to create electricity, and drawing energy from waves and tidal movements.
All of which means the talk in recent decades about energy shortages will again be proved wrong, as all such Malthusian predictions have. Such defeatism misses the mark because it fails to account for the incredible impact of human ingenuity and man’s unceasing search for something better. In short, we can see an incredibly bright energy future on the horizon.
Unless, that is, overbearing government bureaucrats and misguided environmental interest groups get in the way. Unfortunately, there is a real chance of that happening. Energy producers are faced with the delay and costs from government’s slowness in granting permits and its proclivity for issuing new regulations, by environmental group court challenges, and by the left’s almost surreal ability to reject any energy source that becomes viable—even windmills in their backyards. Well intentioned subsidies for renewables reduce the chance for success, since producers learn to live off the subsidies and have less incentive to produce feasible technology. Businesses and consumers feel the impact as energy costs increase.
The policies the president announced Tuesday are more of the same. Less government control and meddling would instead unleash the technologists and risk takers to give us more energy, a stronger economy and a safer and healthier environment.