In recent weeks, America’s airwaves have been deluged by messages placed by Texas oilman T. Boone Pickens, warning that the country is being taken for $700 billion for foreign oil this year, with still more to follow, a devastating loss amounting to “the largest transfer of wealth in human history.”
While very shocking, the Pickens ads are in fact understated, because the OPEC oil cartel is not just looting the United States, but the whole world, and will accumulate over $1.5 trillion in net profits this year. The entire U.S. Fortune 500 is worth $18 trillion. At their current rate of take, OPEC will acquire enough cash to buy majority control of every leading company in the United States within six years. This is a direct threat to American independence. “It’s wrecking our economy,” Pickens says. He’s right about that too.
America owes a debt of gratitude to T. Boone Pickens for stepping forward to sound the alarm over this national emergency. This is all the more true, since as an oilman, Pickens could simply have followed the model of others in the business and just sat tight, enjoying record profits while the country goes under. Instead, he chose to act as a patriot.
So hats off to Mr. Pickens. That said, the plan he is advancing for dealing with the crisis — build windmills to release natural gas from electricity generation so it can be used to power compressed natural gas (CNG)-driven cars, displacing gasoline in the process — is technically flawed and needs to be revised.
While a net exporter twenty years ago, the United States today imports about 18% of its natural gas. So without a very substantial change in our electric power generation portfolio, shifting from gasoline to natural gas would just shift us from one imported fuel to another. Wind power is an improbable candidate for achieving such a shift. Simply to replace the 18% of our natural gas we currently import would require multiplying the nation’s current total wind power tenfold; to free up enough domestic natural gas to replace half our gasoline would require a thirty-fold wind power increase. The feasibility of doing this is very doubtful, not merely because of the size of the project but because wind power is intrinsically unreliable. When the wind speed drops in half, power output drops by a factor of eight, so wind simply cannot provide the baseload power. Rather, it can only be used as an as-available auxiliary to reduce somewhat the net overall fuel consumption of a fossil-fuel-driven baseload system that must have — and frequently run at — full power capacity to meet the needs of its customers. Replacing natural gas power generators with nuclear or coal-fired systems would be possible in principle, as both of these can provide reliable baseload power, but would take many years and entail many other problems.
Furthermore, shifting to natural gas as a critical transportation resource is unwise for fundamental logistical reasons. The United States is currently using natural gas at a rate of 27 trillion cubic feet per year. The total known reserves of natural gas in all of North America are 274 trillion cubic feet. And while new reserves are always being discovered, launching a heroic effort to shift our transportation system to critical dependence upon a fuel whose known domestic reserves amount to little more than ten years’ supply is simply not prudent.
Finally, compressed natural gas is an inferior technology for vehicle fuel. This is so because it is a gas, not a liquid, and so must be stored in heavy high-pressure tanks. A standard steel K-bottle compressed gas cylinder, which weighs about 133 lbs, can only store enough natural gas to match the energy content of two gallons of gasoline. So CNG cars are either limited to short range, or must carry massive tank systems that increase their cost and reduce their mileage. Lighter graphite composite tanks are possible, but these are very expensive and unsafe in the event of a crash, as they are susceptible to breakage followed by gas release and explosion.
So the Pickens plan, as written, won’t work. Fortunately, however, there is a way to modify it so that it can. The key is for Congress to pass a bill, such as the current Open Fuel Standards Act (S.3303, HR.6559) requiring that all new cars sold in the U.S. be fully flex-fueled — that is, capable of running equally well on gasoline, ethanol, and methanol. Such technology is currently available and only adds about $100 to the cost of a car (in contrast to CNG capability, which adds about $2,000). The reason why establishing a full flex-fuel standard is the answer is that methanol — a very safe and practical liquid vehicle fuel — can be made from a vast array of feedstocks, including not only natural gas, but also coal, recycled urban trash, and any kind of biomass without exception.
So if a bold wind or nuclear energy initiative can in fact free up enough natural gas to make a difference to the vehicle fuel market, flex-fuel cars can readily make use of it in a much safer and more practical form as methanol. But if not, then we — and the rest of the world (since an American flex-fuel requirement would effectively make flex-fuel the international standard, as all foreign car makers would need to switch their lines over to conform to it) — would also be able to make our fuel from a wide array of alternative resources. Indeed, we have enough known coal reserves for hundreds of years’ worth of supply, and enough crop residues available globally that, converted into methanol, could replace all the oil of OPEC. The key is not to pick one particular fuel resource, but to open the fuel market to all comers. Setting a flex-fuel vehicle standard is the quickest and most efficient way to achieve that goal.
By creating such a true free open-source fuel market, we can make it possible for every nation to contribute to the world’s fuel supply, breaking the monopoly power of the oil cartel, everywhere and forever.