Obama's Oil Reality Check
Grow Your Business, Not Your Inbox
Editor's Note: After less than a week in office, President Obama demonstrated he would waste little time rewriting the rules for auto standards. On January 26, Obama directed officials at the Environmental Protection Agency to quickly ratify an application by California and 13 other states seeking to set limits on greenhouse gases from cars and trucks that are stricter than federal guidelines. Carmakers have vigorously opposed California's move but at least four federal courts have ruled in favor of the states. Obama also ordered Department of Transportation officials to write rules implementing a 2007 law mandating a 40 percent improvement in gas mileage for autos and light trucks by 2020.
For Barack Obama, sensibly and scientifically curing the nation's energy crisis at breakneck speed will be better than a bucket of bailouts and several military invasions combined.
The new president could fight Iran and terrorism by reducing the estimated $1 trillion the U.S. economy spends each year on foreign oil from OPEC regimes. Jobs upon jobs would be created if his administration creates a new fuel infrastructure, alternative propulsion supply line, and upgraded public transit. What's more, by subtracting America's dependence on Mideast oil, Obama can influence whole spheres of foreign policy. Imagine a Middle East devoid of the petropolitical pressure point.
At the outset, Obama must sever his allegiance to politicized fuels that make no sense. Gal Luft, energy guru and co-founder of the anti-foreign oil Set America Free Coalition, is among those who say the nation will never achieve fuel independence as long as the Iowa Caucuses remain pivotal to presidential campaigns. As a result of Iowa's keystone political status, corn ethanol has secured an $8 billion annual taxpayer subsidy going directly to oil companies and agricomglomerates, such as A.D.M. and Cargill. This is for an oil-dependent fuel mix that requires 1.25 gallons of petroleum products to produce and deliver a single gallon of ethanol. At the same time, critics note, more productive Brazilian sugarcane ethanol-which is 100 percent petroleum-free-is kept out of America with high tariffs. Similarly, "clean coal" is a decades-long boondoggle supported by Obama to secure coal-belt votes.
Once fuel distractions are gone, the Obama administration can focus on an uncomfortable truth: It must retrofit, that is, convert vehicles en masse to any of a myriad of fuel or propulsion alternatives, such as methanol, electric, or compressed natural gas. The word "retrofit" is one Obama never used during the presidential race. His original campaign pledge to place 1 million plug-in hybrids on the road by 2015 is, in fact, meaningless rhetoric, Department of Energy statistics suggest. There are currently 250 million gas-consuming cars and trucks on the road. By 2015, experts expect more than 300 million in America. One million plug-in hybrids, electric, compressed natural gas, or any other type of alternative propulsion vehicle will not even be noticed.
Immediate retrofitting, also known as "upfitting," will be required to get off of oil. It can be done, but only with a national crash program. Look at what's going on in Iran, of all places. Because of sanctions against it, Iran hasn't been able to build oil refineries and as such, has become the world's second largest importer of gasoline. So now, Iran is converting its national fleet to use compressed natural gas at the rate of 20 percent per year to counteract tightening sanctions over its nuclear ambitions. Its same-day, government-subsidized, $50-per-vehicle conversion campaign will soon make Iran gasoline-free. Many in the alt-fuel community insist America can do too this if Obama will take action.
However, in order to retrofit, Obama will have to suspend obstructive E.P.A. guidelines that effectively prohibit converting gasoline cars to abundant, cheaper compressed natural gas or other alternative fuels. E.P.A. testing procedures costing at least $50,000 per engine type have ensured that beyond a handful of workshops, there is virtually no retrofitting industry now functioning in America. That business will need to be invented. Short of immediate-and unlikely-Congressional action to suspend alt-fuel regulations, presidential powers are needed. That could set up a Constitutional test reminiscent of F.D.R.'s New Deal.
If Obama moves to retrofit, he will discover millions of vehicles operating in more than 28,000 public and private fleets. This includes about 220,000 postal vehicles and about 100,000 trucks at U.P.S. The nation's taxi fleet, 100,000 strong, experiences a 100 percent turnover every three years. By immediately requiring fleet purchases to be alternative fuel and propulsion, energy experts believe manufacturers will see a mad scramble to fill orders. An entire army of unemployed autoworkers and cash-starved fleet managers stand ready to participate in a national upfit. Obama can give birth to a whole economic sector, assert people like Rich Kolodziej, president of Natural Gas Vehicles America, who backs eliminating the nation's dependence on foreign oil.
In addition, starting immediately, Obama must insist that all vehicles become multifuel vehicles. Proposed bipartisan legislation for an Open Fuel Standard would require half of all cars to be multifuel by 2012. But many feel this is too distant a goal. It must be done now, they argue. And it can be for $100 to $200 per vehicle if Obama will require Detroit to do so as part of any continuing bailout, asserts Luft, of the Set America Free Coalition. Again, Obama could well give birth to an economic sector.
Open Fuel, combined with Obama administration efforts, can immediately stimulate alternative fuel production. Contrary to automaker protestations, neither compressed natural gas (C.N.G.) nor hydrogen needs a neighborhood gas station infrastructure. Home or office refueling devices, such as those now under the control of Honda but not widely sold and in some cases kept off the market, will convert ordinary household oven gas to C.N.G. fuel. The Honda Home Energy Center can convert household natural gas to hydrogen for cars. Obama's administration needs to acquire the independent expertise to see this obvious fix and get it deployed, according to hydrogen and C.N.G. advocates such as Martin Barillas, editor of Energy Publisher. He says, "I was driving a C.N.G. car 25 years ago in Guatemala with no neighborhood filling stations, just home fueling." In this vein, alt-fuel advocates suggest that patents not being acted upon must be seized and put to public use in a so-called "compulsory license." The wartime precedents for Obama to consult regarding this type of intervention are ample.
However, many feel that any intelligent vehicle design and production and the required alternative fuel supply will never happen unless Obama appoints a Car Czar to invasively intervene in auto-propulsion specifics. Everything-from the size of the gas tank neck to the thickness of dashboard padding-is government-mandated. For decades, Detroit has chosen the wrong cars to produce for U.S. security, a chorus of auto industry critics asserts. Every vehicle now has a national security profile defined by how much gasoline it consumes-a point made recently at a meeting of the Western Automotive Journalists. Obama's Car Czar-says Marc Rauch, co-publisher of TheAutoChannel.com, an online automobile resource must try to bring sense not only to emissions and bumper strength, but also to oil dependency. Such a Car Czar will need bailout veto power as vibrant as the Secretary of the Treasury now wields on Wall Street.
Obama needs to launch the crash energy fix everyone has called for, headed by a military man or scientist impervious to lobbyists and all of the conflicting special-interest groups. Unless they're excluded, Rauch and others argue, nothing will be accomplished except more empty rhetoric and impotent compromises.
The nation's 44th president must act at breakneck speed, implementing the best available options today and better ones tomorrow. That requires a descent from the clouds of campaign rhetoric to where the rubber meets the road. If Obama fails the reality oil check, then America will continue to descend into its well-constructed oil demise. Then the only "change" the nation will see is change for the worse.
Edwin Black is the New York Times best selling investigative author of IBM and the Holocaust, Internal Combustion and his just released book, The Plan: How to Save America When the Oil Stops-or the Day Before (Dialog Press). He can be reached at www.edwinblack.com.
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