By: Niel King Jr.
The Wall Street Journal
June 30, 2008
The oil shock of 1973 came and went. So did the panic after the Iranian revolution six years later, when oil prices shot to record highs. Gone, too, is the brief flurry of fear that followed Iraq's invasion of Kuwait in 1990
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After each, voices in Washington that cried out for big changes in U.S. energy policy were slowly drowned out. James Schlesinger, the first U.S. energy secretary, has said for decades that when it comes to energy policy, the U.S. toggles between complacency and panic.
Will it be different this time around?
With oil soaring above $130 a barrel and fears spreading of a long-term supply crunch, a new cadre of energy Cassandras in Washington argues that America faces deep and potentially wrenching challenges that no amount of gas-tax holidays or rhetorical attacks on speculators and big oil producers will help fix.
From the Pentagon to Capitol Hill, some often lonely voices are warning of big shocks to come if the U.S. doesn't wake up. Not all of them point to the same core problem, however. Nor do the proposed solutions dovetail neatly. But they all agree that the main challenge is to overcome the complacency without triggering the panic.
Here is a look at four of these voices:
Mr. Peak Oil
Back in the halcyon days of March 2005, when oil was at $54 a barrel, Rep. Roscoe Bartlett stood on the House floor to give the first of many lonely speeches.
The Maryland Republican -- son of a tenant farmer, holder of 30 patents, trained physiologist, former dairy farmer -- knew the speech would win neither votes nor applause from the commuters and farmers who populate his district. But he had a message to impart: The world has less and less oil to offer, he told the near-empty House chamber. The age of cheap energy is ending. And if the U.S. didn't start adapting, it was in for a shock.
Not much has changed since then, except that the U.S. is now using more oil every day -- about 20 million barrels a day, according to the Energy Department -- and it costs well over double what it did then.
"The tumor has now grown to where it will require even more radical surgery," says the rumpled 82-year-old father of 10, who carpools 100 miles a day in his Prius. He was the first member of Congress to own one, he says.
Rep. Bartlett is Mr. Peak Oil in the U.S. Congress, which also makes him perhaps the loudest energy-shock spokesman on Capitol Hill. Every few weeks, Rep. Bartlett hauls his thick stack of huge charts -- around 30 in all -- over to the House floor for his after-hours lecture for the viewers of C-Span. In the past three years, he has lectured the nation 42 times on how ebbing oil supplies will bring a big jolt to the U.S. economy.
One of his favorite placards shows "The World According to Oil," with every country's size based on its oil holdings. Saudi Arabia is a goliath, while Europe is barely a speck. Another shows how major oil discoveries petered out in the early 1980s, just as consumption resumed its upward tear.
The lectures have earned him a clutch of followers. He now heads a Peak Oil Caucus of like-minded lawmakers -- six Republicans and eight Democrats. They have sponsored a resolution, still stalled in committee, calling for a "Man on the Moon" project to develop new fuels and wean the nation off oil.
Two years ago, Rep. Bartlett got to meet with President Bush in the Oval Office, where he gave a condensed one-on-one version of his peak-oil talk. "He was polite, attentive," Mr. Bartlett says of Mr. Bush. "He said 'Thank you.' "
Mr. Bartlett often stands apart from his fellow Republicans on the energy front. He voted for last year's energy bill, one of just 26 House Republicans to do so, but only after voting against an amendment to open Alaska's Arctic National Wildlife Refuge to oil development -- a top Bush administration objective.
Declarer of Independence
James Woolsey, a Beltway Democrat-turned-Republican, is plotting to go "off-grid" and tools around town in a plug-in hybrid with a bumper sticker that says "Osama Bin Laden Hates This Car."
CIA director under President Clinton and President Jimmy Carter's secretary of the navy, Mr. Woolsey is himself a hybrid: part switchgrass-loving hipster and part national-security hawk who backed the Iraq invasion and considers Saudi Arabia to be a promoter of Islamic extremism.
Mr. Woolsey's mantra, though, is that the U.S. needs to break its dependence on Middle Eastern oil. It's a forlorn quest that goes back decades.
But Mr. Woolsey is convinced that the U.S. can and must break that reliance. And as Sen. John McCain's top energy adviser, he's taking the quest for "energy independence" straight into the presidential campaign.
Mr. Woolsey says he first got "ticked off" over energy when he got stuck in a gas line in 1973 -- "and I'm still ticked off." What also peeves him are critics who snipe at the call for independence without understanding it.
No, the U.S. can't cut itself off from all oil imports or turn itself into an "economic hermit," he says. "But we can destroy oil's monopoly over transportation."
Cars, trucks and planes gobble up nearly seven out of every 10 barrels of oil consumed in the U.S., the Energy Department says. Mr. Woolsey wants to chop that way down.
A frenetic talker with a shiny pate, Mr. Woolsey insists that America's salvation lies mainly in battery-powered cars and alternative fuels. A McCain administration, he says, would assure that all new cars could use any mix of fuels and would push for large tax credits for plug-in hybrids.
At least he practices what he preaches. Beyond his Prius, Mr. Woolsey has photo-voltaic panels on the roof of his Maryland house -- and even on his laptop case. At times, he boasts, he can go down into his basement and see that he is giving power back to the Maryland grid. Next up: a small wind turbine on his roof and a plot of biofuel-worthy camelina in his yard.
Perhaps because of his own mixed political lineage, Mr. Woolsey is known for bringing odd birds together. His Set America Free Coalition, a group dedicated to weaning the U.S. off foreign oil, runs the gamut from conservative evangelical Gary Bauer to prairie liberals like Tom Daschle, the former senator from South Dakota. Like Rep. Bartlett, he also takes some un-Republican positions, such as opposing oil drilling in the Alaskan wildlife refuge.
He has a name for the odd coterie he sees congealing around the energy issue: "tree-huggers, do-gooders, sodbusters and cheap hawks." And he considers himself a part of each.
Wolf in the Hen House
Alexander "Andy" Karsner, the Bush administration's assistant secretary for energy efficiency and renewable energy, is having another typical day.
He has just ducked out of a meeting with a clutch of federal utility
officials. He's off soon to a high-level session on the growing controversy over food vs. fuel. There are meetings later in the day on efforts to boost the nation's wind-power supply. And outside his office at the Energy Department, all along Independence Avenue, truckers miffed over soaring diesel prices are blaring their horns.
"Yeah, burning gas as they honk around town," Mr. Karsner says of the truckers.
Mr. Karsner, a former CEO of energy consulting firm Enercorp., takes a far gloomier view than most within the Energy Department on the challenges the country faces. When he looks over the horizon, he sees slumping oil supplies and soaring demand. "This isn't fusion," he says of the world's reliance on crude. "This is a finite resource."
What drives him, he says, is "the very real future" that his three young daughters face -- a future that he says puts into question "the quality of life and the inheritance of the American dream."
Since he arrived at the DOE in early 2006, Mr. Karsner's main fight has been to push for the quick commercialization of alternative technologies, from solar to biomass and batteries. Despite early opposition within the department, in the past two years he has been the main force behind ramping up the level of grants and loans available to companies bringing new technologies to market.
"Andy is totally focused on action," says Reid Detchon, who runs the energy program at the United Nations Foundation and who otherwise gives the administration an overall "F" for its environmental legacy. "He could have been a place holder," Mr. Detchon says, "but he has just been relentless in pressing a very active agenda for commercialization of renewable technologies."
After just over two years on the job, Mr. Karsner worries that the federal government remains too stodgy to confront what he calls "the asymmetric security threats" posed by the huge amounts of oil the U.S. imports -- and the billions in dollars it ships to the Middle East as payment.
"Every bit of money that goes away is a lost opportunity for money we could have invested here," he says.
Mr. Karsner, who says he will leave government by January, also is realistic about how much more the Bush team can hope to do. "Most of what we are doing right now," he says, "is assuring that our successors will be more successful than we are."
Canary in the Mine
For a man with a disturbing message, Robert Hirsch couldn't be milder. Crisp, perfectly combed, monotone in delivery, the former nuclear engineer reminds one of a retired MIT professor kicking back on his Cape Cod porch.
But Mr. Hirsch has become a prophet of sorts for the country's growing legions of peak-oil converts who know him mainly as the lead author of the 2005 Hirsch Report. The actual title of the 91-page tome, ordered up but then shunted aside by the Energy Department, he says, was "Peaking of World Oil Production: Impacts, Mitigation, & Risk Management."
Jim Slutz, acting deputy assistant secretary for fossil energy, says the study was never meant to represent the views of the DOE and was taken out of context by peak-oil adherents.
The report, the first of its kind commissioned by the federal government, didn't mince words: The U.S. had to move quickly to prepare for an inevitable long-term supply crimp as world oil output begins to slump. "Without timely mitigation, the economic, social, and political costs will be unprecedented," the report concluded. "Viable mitigation options exist on both the supply and demand sides, but to have substantial impact, they must be initiated more than a decade in advance of peaking."
Mr. Hirsch says he has learned a few things since the report came out.
For one, he has revamped his view that the world would hit a sharp peak in production, followed by rapid output declines. Instead, like many in the industry itself, he says world-wide oil production will stick to a sustained plateau -- driving up prices as demand continues to rise. "We have already been on a plateau for sometime," he says.
He also learned that the Bush administration wasn't very keen to hear his gloomy message on long-term oil supplies. "The message came from DOE headquarters that we could work on ramification issues but not on peak oil itself," he said. There are now signs -- among them the bracing views of Mr. Karsner at the DOE -- that the administration is leaning toward a less rosy view of the world's energy outlook.
Mr. Hirsch's career has covered the spectrum from head of fusion research at what was then known as the Atomic Energy Commission to a senior post in the exploration and production department at oil company ARCO, which is now a part of BP PLC.
But he considers his current work as a private consultant equally important. As he pounds on doors around Washington and across the country, he finds that more and more of them are swinging open. He lectured a large group of intelligence officers from around the world this spring. He has traveled several times to New York to sit down with investment-fund managers. He briefed the energy teams of Sens. Hillary Clinton, Barack Obama and John McCain.
"There is no question that serious concern is germinating," he says. "It just hasn't taken root yet and begun to grow."
