If you follow what the new Administration is doing on energy, you have heard and read a lot about energy dominance and energy independence. Let’s take a look at that.
In 1973, something happened called the Arab Oil Embargo. It came about because of what is known as the Yom Kippur War, when Egypt and Syria invaded Egypt in an attempt to regain territory lost in the Six-Days war. When the U.S. stepped in to help Israel with support, most Arab nations in the Middle East took that as a hostile action. Their response was to form the Organization for Petroleum Exporting Countries (OPEC) and pull back on oil exports – thus the “embargo” – and hurt the U.S.
The embargo hit the U.S. and other Western nations hard. Prices skyrocketed and inflation soared, and it was not easy to do a routine thing like fill up your car with gasoline – the lines for that were long and spilled into the streets and roads. (My girlfriend at the time had a nice temporary job. She would sit in someone’s car while they were at work or had to be elsewhere and move the car up one space at a time until she got to the pump).
Obviously, the U.S. was not energy independent in 1973. While it had its own oil and gas production, and and had and used a lot of coal, its economy ran on foreign oil.
Today the U.S. is energy independent, thanks mainly to fracking and other advances in drilling, production and, in the case of LNG, shipping technology. We have evolved to become one of the world’s largest exporters of fossil fuels, and in the case of gas we are Number 1.
It is a great accomplishment for the U.S. to become energy independent.
The problem is that we are becoming independent in the wrong way. It is great that the U.S. has oil, coal and gas resources. The use of them has over the decades allowed it to achieve incredible economic growth and become an economic powerhouse around the world.
But the U.S. is not independent of climate change. While impacts are different in different places, the U.S. is and will not be exempt from its impacts. Yet we continue to burn, baby, burn thinking that there is no other factor to use in making energy policy decisions other than continued use of our fossil energy resources.
The other resource we have, of course, is abundant solar, wind, hydro, geothermal and other clean energy options in the basket called “renewables”. And they are tied to climate change in the “right” way. Using them to be energy independent would be a “two-fer”. It would not only allow us to be energy independent, but it would significantly address our emissions problem.
But regardless of what energy source we are talking about, there is another type of energy-related independence that the U.S. does not have. It is one which increasingly is being shown to become one of the important contributors to a country’s energy sector and economy - technology independence.
As we are all focused these days of tariffs and trade wars, the world is now a global market, with global supply chains. And now it is not just a question of what a country’s domestic energy sources are, but what does a country need from another country to be able to utilize them – especially in the case of renewable resources. For example, the technologies for modern solar energy were for the most part developed in the U.S. But the lack of good energy policy resulted in China being the one that turned the technologies into products and took those products to market. The U.S. largely relies on panels from that country for solar.
Domestic energy is also not just about raw energy resources – it is about electricity, which is what economies and societies run on. And to make electricity, or better yet, use it more smartly, or use less of it, the U.S. needs things from other countries. Take rare earth minerals. You have likely seen in the news lately that China is where the U.S. presently gets most of its rare earths – substances that are essential to the high tech, automotive, energy, and other industries. Yet China is also a country that the U.S. is in a major trade war with. Yes, there are rare earth deposits in the U.S., and parties are rushing to develop them.
It seems like we should have seen this new kind of independence coming a long time ago and developed policy to manage it.
Instead, the present Administration and Congress seem to be focused on the old type of energy independence, as if we were still in the days of OPEC and the embargo.
And they have added a new goal - Energy Dominance.
If you read Project 2025, or look at the policies being currently pursued, energy dominance is being defined as using the country’s fossil fuel resources to increase our exports beyond what they already are and using this to create offshore economic dominance.
It is true that the world’s appetite for fossil fuels is strong and, in some places, is unfortunately growing. But the rest of the world is much more attuned to climate change than the U.S. They are trying to reduce their use of fossil fuels, and enacting policies like carbon pricing to do so and supporting renewables. Yes, some countries have had to pull back or modify their climate goals and timetables – but they still know where they want to go, and it is not backwards. They do not want to be a future market for U.S. fossil energy.
The U.S. has for decades avoided developing a national energy policy and a national climate policy. Ideally those two would be intertwined, but even separately it would be great for each to be in place.
But we are in different times. We are pursuing the wrong kind of energy independence and operating under the fallacy of energy dominance. There is no guarantee either will prove beneficial. But global warming and climate change is guaranteed based on what has already happened and based on CO2 concentrations that already exist. And pursuit of the wrong kind of energy independence and using that to pursue energy dominance is guaranteed make it worse.