This is the reality we live in: By 2050, the world will demand twice as much energy as it does today. Many assume or hope that fossil fuels will not be needed in the future; that our energy needs will be met through energy efficiency and renewables. But this is simply not achievable in the short term. Even as we work to develop alternatives, to reduce CO2 and to address climate change, oil and natural gas will be required for many decades to fuel our economy and our way of life – and to transition us to a greener energy mix.

Here in the U.S., we currently import 58 percent of our energy needs. Yet, ironically, our country is energy rich, with vast resources. In my view, we must take full advantage of our own enormous and largely untapped oil and gas resources, located predominantly in the Outer Continental Shelf. Offshore Alaska alone has one of the largest untapped oil and gas fields remaining in the world, but we have been unable to develop these resources due to litigation and a regulatory structure that has not allowed us to get the permits we need to explore. Developing these resources will create solid, long-term jobs, help provide energy security and generate much-needed government revenue – all while we work toward a greener future.

I’m convinced, and our record proves, these offshore resources can be explored and produced safely and responsibly. They offer the prospect of significant national benefit without spending a cent of stimulus funds from the federal government. Oil and gas production technology, science and safety have improved dramatically over recent decades. Our technology allows us to produce more with an ever-smaller footprint and infrastructure. At every step of the way, we provide appropriate environmental protections based on solid science and an understanding of ecosystems and the impact of oil and gas activities on them. While some areas must remain off-limits to drilling, work could get underway quickly in many places.

I am hopeful that Congress and the Obama Administration will embrace sound policies that enable development of domestic oil and gas resources, so that we can address our escalating energy needs, restore our economy and create more jobs in our country.

This is the end of a very interesting week-long dialog on the need to reduce America’s dependent on foreign oil. I appreciate all off the thought and time which those who joined in the discussion gave to this process. Here are my closing thoughts:

There appears to be a convergence of policies which for many decades appeared to have been at odds with one another. On the one hand there is a need – for economic, environmental, and national security reasons – to significantly reduce our dependence on foreign oil. About 70 percent of the petroleum we import is used as a transportation fuel as gasoline or as diesel.

With President Obama’s announcement of new efficiency and emission requirements for vehicles to operate on American streets and highways, the other hand has now been opened.

Natural gas, of which we have more than a 100 year supply in the continental United States, helps address both of those policies.

The technology to use natural gas as a transportation fuel is proven, is available, and is affordable. Natural gas is cheaper than imported gasoline or diesel fuel, and it presents less wear-and-tear on a vehicle so the life-cycle costs are significantly less than a car, light duty truck, or 18-wheeler running on a petroleum-based fuel.

Natural gas also burns significantly cleaner than either gasoline or diesel. There are zero particulate emissions; and greenhouse gas emissions meet the new government standards right out of the pump.

According to the Environmental Protection Agency, compared to traditional vehicles, vehicles operating on compressed natural gas reduce carbon monoxide emissions of 90 to 97 percent, and reduce carbon dioxide emissions of 25 percent which is, 83 percent of the President’s goal for CO2 emission reductions.

Battery powered cars – and the coal-fired electricity necessary to be generated to charge them – are at least a decade away. And, in any event, batteries won’t push 18-wheelers down the highway.

The Congress should embrace the President’s goals and pass legislation to provide incentives for truckers, state and local municipalities, and individuals to immediately begin moving America from dirty, expensive, imported oil to clean, cheap, domestic natural gas.

Updated at 11:31 a.m. on May 22.

In the long run electric cars could be part of the viable options to the now conventional petrol-powered internal combustion engine. However, as Mr. Pickens stated, we don't have the grid set up for a massive replacement of internal combustion cars with electric cars just yet. Converting our "dumb grid" to a smart grid could be a large step forward in the direction of a new transportation future. But the environmental impacts of electric cars will be largely determined by how the electricity is made. One of the more efficient and least greenhouse gas emitting methods of producing such electricity could be found in nuclear-- if the problems of dealing with the nuclear waste and other technical, legal and political issues are dealt with. Alternatives, such as wind, solar, tidal, geothermal, and the like could also be hooked up to the smart grid. But all of these are long-run propositions.

Also, possibly multiple vintages of cars and trucks may have to go through before we could convert to electric vehicles and whatever else options we might find ourselves heading toward... Some technical issues like the batteries for the trucks can also be worked out -- but this will likely not happen anytime soon. We also need to be flexible and open-minded as technologies and other things are developed, changed and chosen.

CNG is an option in the nearer runs. Some biofuels might be an option, but many of these have their own problems, such as energy in-energy out returns. Corn-based ethanol is not a particularly economically viable or technically viable option, looking at all of the costs and benefits involved, for now. Cellulosic bio fuels of the 3rd and 4th generation varieties might be in the cards.

We should also begin to focus more on light-weighting of cars and trucks. We can build them with carbon fiber and other lighter, and actually safer, materials, than the much heavier materials we are using now. You might want to consider a company called FIBREFORGE as an example of this. We could also focus on making those cars and trucks more aerodynamic and overall more efficient in their use of energy to move passengers and cargo. A lot of energy can be saved by simply making transport vehicles lighter.

We could also focus on the development of a real and effective rail transport system in this country both for long distance movements of cargo, and short distance light rails. Much energy could be saved by setting up smart rail systems. Then we might just need less of those heavy trucks that Mr. Pickens mentions. Rail engines could run on multiple, flex-fuels, including LNG, CNG, electricity and more. Rail transport uses a lot less energy per ton-mile and passenger-mile than the road transport we are using now.

We need to consider our transportation futures in terms of a portfolio approach; much like a good investor would consider what to invest in. We need to look at risks, returns, relative costs, and more to figure out what the best mix of alternatives there could be for us to develop in the next years. There is no silver bullet. There is no one answer to our transport and energy future. However, the time to really start mapping this out is now. We need to be reasonable about what we can do in the next year, the next 5 years, the next 20 years and more. Things clearly need to change, but we need a common sense approach that will involve inter-disciplinary teams, coalition building, and grassroots support for these efforts.

Frankly, there is a lot of money to be made in the changes that will happen, and that will bring in the private sector. Initial funding for some of the projects may need to come from the government, like the new E-Arpa being discussed. But my sense is much of the real invention and innovation, once this whole process starts gaining movement, will be in the private sector.

But to paraphrase one of Mr. Pickens' famous quotes: It is not time to aim, aim, and aim. We need to start pulling the investment and strategy triggers on these issues before we find ourselves in a much more difficult situation. There are also potentially huge returns for the person or companies that invent the next generation transport technologies and energies. As I tell many of my students and others: that is where the next Bill Gates will come from.

Entrepreneurs like Mr. Pickens could find some real challenges in the future energies and transportation systems. These changes could be some of the generating forces behind the beginning of the next American century. We should lead this. It is better to ride the next wave than be rolled by it.

I am for anything American. Using electricity as a transportation fuel is an excellent idea and I agree that we should move ahead on that front for cars and light-duty trucks. However, a battery will not move an 18-wheeler. The only domestic fuel available today to replace imported diesel is natural gas.

There will come a time when battery and fuel cell technology is developed and available to the point where they indeed become the principal transportation fuel in America. But that day is not today and it is not likely to come for, perhaps, decades.

Oil prices are on the rise. OPEC is seeking a $75 per barrel level and, when the recession eases in 2010 the supply-demand ratio will cause oil to move back over $100. We are not going to replace any significant numbers of automobiles burning gasoline with cars running on electricity in the next two years.

There are about 250 million cars and light-duty trucks on America's highways today. Making a five percent shift from gasoline to battery means moving 12.5 million vehicles onto battery power. We don't have the domestic capacity to manufacture those batteries, right now most batteries are manufactured in China-let's not trade our foreign oil dependency for a Chinese battery dependency. We don't have the transmission infrastructure to feed those batteries, and we haven't yet seen the research about the wear and tear on city and residential streets which will be increased by the additional weight of that many battery-powered vehicles.

On the other hand, nearly 30 percent of the oil we import is used by heavy-duty trucks. There are about 6.5 million 18-wheelers on America's highways. Moving five percent of those vehicles off imported diesel and onto natural gas means retiring a reasonable number of heavy-duty vehicles - 325,000 - and replacing them with either compressed natural gas (CNG) or liquified natural gas (LNG). We can make real progress toward reducing our dependence on foreign oil while providing thousands of jobs and cleaning up our environment.

We shouldn't be picking winners in our effort to decease our need for foreign oil. But neither should we ignore a transition fuel - domestic natural gas - which is available in virtually unlimited supply, while we work on other, permanent solutions. We have a window of opportunity, we need to seize it.

-- Boone Pickens

Congress absolutely should be working to reduce our national dependence on imported oil. But, this discussion is overlooking one of the best ways to reduce our dependence on foreign oil – electric transportation. Widespread adoption of plug-in hybrid and battery vehicles will not only reduce the amount of oil and petroleum products used, but also reduce emissions and operating costs for consumers. As an electric utility, we are investing in these technologies now to remove infrastructure obstacles in advance of large-scale commercial availability of these vehicles. Progress Energy has one of the nation’s largest plug-in hybrid electric vehicle research-and-development programs, but more can be done. We urge Congress to take action in the following areas:

• Provide new funds for technology research, development and deployment programs, including battery storage systems and “smart grid” technologies;
• Restore funding for medium and heavy-duty vehicle research and development to ensure this sector can meaningfully reduce petroleum consumption;
• Add PHEV infrastructure to existing federal grant programs;
• Require advanced battery standardization for both mobile and stationary applications and standards governing connectors and other infrastructure;
• Extend and expand tax provisions to promote electric transportation; and
• Provide a better financial incentive to battery makers by guaranteeing a purchase of advanced batteries and reduce consumer risk by providing an extended battery warranty program.

Together, these actions by Congress can help build on the progress has already made to further reduce vehicle-related emissions.

The following comments on T. Boone Pickens’ question come from David Holt, executive director of the Consumer Energy Alliance:

Our continued failure to develop a sensible US energy policy that provides for the timely, safe and efficient development of our abundant natural resources is costing this country millions of jobs and putting us at a significant competitive disadvantage relative to other nations that more effectively utilize their resources. The Oil & Gas industry employs almost 6 million hard-working Americans. But that only tells part of the story. There are 20 million US citizens employed in manufacturing, 10 million in trucking, 10 million in the airline industry, 20 million farmers, 2 million folks making iron & steel, more than 40 million retirees (many living on fixed incomes), millions more employed by hospitals, restaurants and other industries that directly rely on the availability of energy supplied in a consistent and cost-effective manner.

While the US develops an effective, diverse energy portfolio that includes wind, solar, hydro and nuclear (among others), our global economy will still rely on oil & natural gas for the vast majority of our energy needs for decades to come. As we are making that transition to a more diverse energy portfolio, we need to access our offshore and onshore oil & gas supplies. Take offshore Alaska as just one of many examples: if the waters off Alaska’s coast were considered an independent country, it would be in the top ten in national oil resources. Alaska’s abundant oil & gas could supply America’s consumers with safe, efficient and home-grown energy for decades to come. But red-tape, slow permitting, and an inefficient regulatory structure all cause costly delays. And once permitted, development of these areas face years of potential court challenges from groups opposed to the thought of oil & gas production.

There has got to be a better way to lower prices, create jobs and build a better US economy.

When Boone Pickens refers to “virtually unlimited natural gas resources,” he is, of course, engaging in harmless hyperbole. His point is that we have a lot more natural gas domestically than is commonly understood by politicians in Washington. “Shale gas” has made the news lately and is a game-changer in the producer world. Shale gas, in combination with the gas that comes from more conventional geologic formations, is the basis for the 100+ years of supply you hear around town. But that’s just the tip of the iceberg. Hydrates are frozen methane molecules and while they are not economic now to produce, neither was shale gas a few years ago. When hydrates become economic, they add hundreds of years more to the 100+ figure. The industry is working quietly on these and other technologies, and we are ready to be a sustainable part of the country’s long-term energy future—and much more than just a bridge fuel for 20 or 30 years, as some have suggested.

It is true that LNG imports have been increasing lately. But even if imports double from 2005 to 2010, it would still only represent about 6 percent of our nation’s natural gas needs. While it may even grow a little beyond that level, I would venture to say that none of us in the natural gas industry ever expect LNG imports to dominate in any sense of the word. Instead, we use LNG as a safety valve for summer peaks. At that time of year, we use natural gas fill our gas storage facilities. I want to underscore that last point because the U.S. has a world-class storage system—the most extensive on the planet—that must be filled when, it turns out, LNG is at its cheapest. By having a little LNG capability, we are simply practicing good portfolio theory. A lot of foreign dependence is bad. But taking advantage of cheap foreign markets to satisfy a small portion of your country’s energy needs is smart.

We do not have the technology today to say that we can supply all, or even almost all, of our energy needs through renewable fuels. Those advancing the renewable story in Washington must be careful not to oversell their product. We will need all our fuels going forward, including renewables, but renewables are incapable of replacing all on-demand energy uses. Nor are renewables the only way we can reduce our carbon footprint. Pre-combustion—and post-combustion—carbon capture and sequestration will secure the role of natural gas for many centuries to come.

President Obama's announcement today about improving fuel economy standards is a step in the right direction. More important than the fuel economy goals announced (which are small compared to what we really need, but surely we can all understand the importance of the compromises made to get to this stage) is some of the background to the announcement. As stated by Dave McCurdy, President and CEO, Alliance of Automobile Manfacturers in a press release today:

"What's significant about the announcement is it launches a new beginning, an era of cooperation. The President has succeeded in bringing three regulatory bodies, 15 states, a dozen automakers and many environmental groups to the table. We're all agreeing to work together on a National Program."

It is not that just Congress or the President should work on the interconnected issues of increasing percentages of oil demand from imports, the amount of money that pours out of the country to pay for oil imports, climate change, peak oil, the fragility of some parts of the global oil supply chain, and more.

It is that we as a nation (and others) work as a team to help solve these problems that we all face.

It is becoming clearer and clearer to me, as also stated by Mr. Pickens, that President Obama gets it. President Obama also gets it about how important it is to build powerful coalitions as well as grassroots support on these issues. Without such support in the private sector, in the households, in and across government agencies and departments, it could be far more difficult to make real positive change happen than otherwise might be the case.

I also commend the efforts of Representatives Engel and Bartlett, as explained in their intervention, to make futher positive change. These could be important movements in the right directions.

To move to a better and more secure energy and national security future will take a lot of hard work and teamwork -- and Congress and the President could be a significant part of this change, not just through legislation, but also through leadership.

Let us all hope these postitive steps are an indication of where we might be going.

I’m encouraged by President Obama’s announcement today of new efficiency and emission requirements for vehicles to operate on American streets and highways. They focus on a wide range of benefits, but leave one important element out – reducing foreign oil use.

I’m growing more and more convinced that President Obama gets it. The stimulus plan advances wind and solar renewables in power generation, but we’ve got to get serious about reducing our reliance on foreign oil. This means focusing on transportation fuels.

About 70 percent of the petroleum we import is used as a transportation fuel as gasoline or as diesel. Today’s announcement sets the stage for more fuel efficient cars meaning less oil use. It is going to be a shot in the arm for cleaner burning, widely available domestic fuels. I think it also confirms what we’ve known for a while – the SUV era is coming to a close, and that’s probably a good thing. Remember, we use 25 percent of the world’s oil with four percent of the population and 3 percent of the world’s oil reserves. We’re not in line with the rest of the world and our people are suffering. Today’s announcement, along with a meaningful energy plan, helps address that.

For me, natural gas is still the best choice. It is abundant and we have more than a 100 year supply in the continental United States. Natural gas is also the cleanest commercially available fuel for transportation today. Natural Gas Vehicles (NGVs) produce between 93-95 percent less overall toxics compared to gasoline and diesel vehicles, and reduce greenhouse gas emissions by 20 – 30 percent compared with diesel and gasoline fueled vehicles.

The Congress should embrace the President’s goals and pass legislation to provide incentives for truckers, states, and local municipalities to immediately begin moving America from dirty, expensive, imported oil to clean, cheap, domestic natural gas.

Two leaders in the energy debate are weighing in with a joint blog entry: Rep. Eliot Engel, D-NY, Member of the Energy and Commerce Health Subcommittee, and Rep. Roscoe Bartlett, R-MD, Member of the Energy and Environment Subcommittee:

Our answer to T. Boone Pickens’ question is “Yes,” and here’s why: It’s past time for the Congress to act to reduce America’s dependence upon imported oil which poses unacceptable threats to America’s economy, our national security and the environment. Our transportation is 96% dependent upon oil, a percentage unchanged since the Arab Oil Embargo. We exacerbate our nation’s economic woes by exporting vast sums of money – hundreds of billions of dollars every year – to support our oil addiction. We must take action as a nation to break our dependence on foreign oil and simultaneously aid efforts to halt the potentially harmful climate change affecting our planet.

We have joined together to introduce four separate bipartisan bills that would reduce all of these risks by diversifying energy sources for transportation while reducing the carbon emissions associated with burning fossil fuels. It is certain that the world is facing increasing dependence upon OPEC countries and growing risks of shortages of conventional oil for gasoline and diesel in future decades. What is uncertain is what alternative will be available, where and at what price for transportation.

The Open Fuel Standard (OFS) Act, H.R. 1476, would require half of all cars made or sold in America by 2012, and 80% by 2015, to be flexible fuel vehicles that would be able to run on gasoline, or alcohol-based fuels such as methanol or ethanol, or a combination of them. With flex fuel cars that can use gasoline, ethanol or methanol, Americans will have the ability to break our personal dependence on imported oil. We would end oil’s monopoly in the transportation sector, strip it of its strategic status, and protect consumers from price gouging at the pump.

Sharp minds and powerful people on both ends of the political spectrum – from President Obama to former House Speaker Newt Gingrich – have called for implementation of flex fuel technology.

The largest producers of both ethanol and methanol are all in the western hemisphere, and the United States has by far the greatest production potential for both. Ethanol is made from agricultural products. Methanol can also be made from biomass, as well as from natural gas or coal.

Flex fuel vehicles already exist, and they only cost about $100 more than the same car in a gasoline-only version. Ford, Chrysler, and GM have repeatedly committed to making 50% of new cars flex fuel vehicles by 2012. It is a simple and inexpensive modification that should be standard in cars, like seatbelts or airbags.

The Electric Transportation Advancement Act of 2009, H.R. 2234, would accelerate the commercialization of plug-in hybrid and electric transportation vehicles and the reduction of carbon emissions from vehicles. The bill would also expand applications of renewable energy sources to generate electricity and contributions of plug-in vehicles to enhance stability and resilience of the electric grid. Hybrids can increase gas mileage up to 100 mpg and can significantly reduce C02 emissions. Plug-in hybrids can increase gas mileage up to 500 mpg. The Institute of Electrical and Electronics Engineers-USA (IEEE-USA) has estimated the combination of hybrid and plug-in hybrids could reduce the consumption of liquid fuels by 70 percent compared to conventional gasoline or diesel vehicles.

The Oil Savings Act, H.R. 2326, addresses a critical weakness identified by the General Accounting Office: the lack of a formal strategy by the federal government to coordinate plans to achieve oil savings targets or to mitigate the consequences of precipitous short-term or long-term reductions in world oil supplies. The bill would require the federal government to establish an interagency working group to lead and coordinate the development and implementation of an action plan to achieve oil savings targets of 2,500,000 barrels of oil per day by 2015; 7,000,000 barrels of oil per day by 2025; and 10,000,000 barrels of oil per day by 2030. The bill also requires the interagency working group to lead and coordinate a supply disruption strategy for Federal departments and agencies to develop contingency plans in the event of a supply disruption resulting in a precipitous and short-term annualized decline of 4 percent of world oil production. In addition, the bill requires the interagency working group to lead and coordinate a peak oil strategy for Federal departments and agencies to develop contingency plans in the event of a peak and subsequent annualized decline of 4 percent of world oil production.

The Imported Ethanol Parity Act, H.R. 2359, would reduce the tariffs on imported ethanol eliminating an unintended incentive for U.S. refiners to purchase imported oil. This bill is a companion to S. 622 introduced by Senator Feinstein and cosponsored by Sens. Bingaman, Cantwell, Collins, Gregg, Kyl, Martinez, Specter and Webb. The 2008 Farm Bill created an incentive of 11-13 cents per gallon to purchase imported oil compared to imported ethanol, depending on the wholesale price of ethanol on a given day. As Senator Feinstein explained, “The current real trade barrier on sugar-based ethanol imported from Brazil and other foreign sources gives gasoline imports a competitive advantage. I believe this makes no sense – particularly given our nation’s continued addiction to oil imported from the Middle East and other hot spots, as well as the volatility of global markets for the fuels we put in our cars. This legislation provides a sensible policy fix. It lowers the tariffs on imported ethanol to a level at or below the 45 cent ethanol blender credit – while ensuring that foreign ethanol suppliers neither benefit from the ethanol subsidy nor are penalized by artificial barriers to trade.”

These four bills are steps that Congress could take today to benefit generations for decades by breaking America’s addition to oil, strengthening our economy, securing our energy security and reducing the threat of CO2 contributions to global warming.

I am very interested in Mr. Pickens comment about the unlimited resources of natural gas in the US. According to all of the data I have been looking at from BP, the EIA, the IEA, and so forth our imports of natural gas have been increasing, and are expected to increase even more in the future. According to the reports I have been reading the natural gas piped into the US from Canada is also expected to decline. LNG may be our best option for the natural gas we need, if we are thinking conventionally. However, if we are to think unconventionally we have significant reserves of gas in the form of coal-bed methane, shale methane, methane hydrates, and the like. If we really start to be creative we have a "renewable" source of natural gas --- garbage and agricultural waste. The typical American produces massive amounts of carbon-based garbage, especially food waste, that could be converted to natural gas. Natural gas can be captured from land fills and other waste sites. Agricultural waste can also be turned into natural gas. To get a good grasp of this one might want to look at the Methane to Markets Partnership at: www.methanetomarkets.org. If we look just at the known convnetional sources of natural gas, including potential sources in Alaska, the outlook for natural gas is not good, especially of the moratorium on offshore gas in huge swaths of territory remains. I am not arguing to open them all up, but common sense could justify a phased-in used of such gas reserves to act as a bridge to the real future of energy, which is to be found in renewable, clean fuels, that are not major contributing factors to global climate change. Natural gas, being a hydrocarbon, produces greenhouse gases. It has a lower production rate of greenhouse gases per BTU of use, but it is still contributes to a major problem we face. We could also be trading off one energy insecurity for another unless we focus on the non-convnetional sources. Also, who are the major sources of natural gas in the world? Russia and Iran are #1 and #2. Then comes Qatar, Saudi Arabia, the US, Venezuela, etc. Russia, Iran and Qatar hold about 57% of the known proven conventional natural gas reserves. The Middle East and Eurasia have about 70%. A time passes we will move into yet another reliance on a fossil fuel that comes from elsehwere -- unless we change the way we are doing things. We can look for alternative natural gas sources, or we can look at different ways of transporting things so we need less energy total per ton of goods shipped and services rendered. Massive amounts of negative millions of cubic meters of natural gas could be "produced" by making more efficient transport technologies and transport choices. We could also "produce" massive amounts of negative millions of cubic meters of natural gas by making more energy efficient buildings, electricity generation plants and more. The solutions to our energy insecurities may be found more in demand changes, and technology changes and choices, than in the struggle to find new resources -- but both need to be done. And this holds not just for gas.

Back to his point on the oil reserves not covering the needs for the US. This also holds for the world on average. The super major discoveries were mostly made prior to the 1973 oil shocks. Increased proven reserves are not keeping up with increased demands for oil. The really cheap oil has mostly been discovered. If some are thinking that getting oil out of the Arctic will be cheap then they should consider the infrastructure that needs to be built to make those reserves usable, and also the type of facilities that would need to be built to withstand the very harsh Arctic weather, particularly in the winter. It is still very cold and nasty weather up their in Febuary.

Peak conventional gas will also occur. This is likely to happen well after peak oil has kicked in. But we will still look at the climate change issue barreling around the bend of the future.

Creativity, invention, innovation and behavioral change may be the best ways to a better energy security future. This does NOT mean that we need to give up our cosy lifestyles based on cheap energy. As our forebears showed us in the past we can show future generations today: good old Yankee (including Southerners like Mr. Pickens) ingenuity can go a long way.

Let's look at the numbers. We have 3-5% (generously) of the world's oil reserves. We use 25% of the world's oil. The price of oil is highly demand sensitive -- small increases or decreases in demand mean big decreases or increases in price. So if we reduce US dependence on oil, we reduce the number of dollars we send to our adversaries in two ways -- we buy fewer barrels, and, because we are such a major player in the world market, each barrel costs a lot less.

We can even produce far more hydrocarbons domestically, without invading pristine sensitive areas like the Arctic Wildlife Refuge and our coasts. We can produce cleaner, lower carbon, chaper domestic fuels -- it's called natural gas. We have a domestic glut, because power companies won't use cheaper natural gas fired power from independent producers -- they like their monopoly. The auto industry, for reasons I don't fully understand, is unwilling to do in this country what it already does in Argentina -- power a lot of those cars with cheaper, cleaner domestic natural gas.

When you start adding in wind (now cheaper than new coal), solar (coming down fast) and the ability to renovate and upgrade furnaces, air conditioners, appliances, windows, ceilings and walls to increase energy productivity, we can, with relative ease, start weaning ourselves from imported oil, and start reaping enormous national security, economic and environmental benefits.

Why not use what we have a lot of, especially when it is cleaner and cheaper, and stop relying on dirty, expensive stuff we are running out of?

"It's innovation, stupid", needs to be the 21st century mantra of this country. And importing oil is about the most retrograde, stupid habit we cling to.

The U.S. is dependent upon foreign oil because the government has deliberately made us so, not because we don’t have North American resources. Ninety-seven percent of our federal mineral estate has not been leased, and according to the Congressional Research Service, each successive Administration offers fewer lands for lease than the previous one. The Bush Administration, for example, offered less lands for energy leasing than the Clinton Administration, even though under the Clinton Administration, prices were at an all time low.

Energy scarcity caused by politicians only gives politicians more cause to intervene in markets and make matters worse. By creating the impression that the U.S. has no energy supplies, politicians can justify rewarding favors to their political allies, regardless of the cost to consumers and our economy. Such is the case with almost all of the energy proposals being considered in congress, where businesses that can’t make it in the market use government-created scarcity to argue that they should get special treatment, or that their product is essential to the nation’s security. While Washington is busy working on energy proposals that make energy more scarce, more expensive and more fraught with government controls, the Chinese are securing oil supplies around the world for their growth in the future. While Washington is busy divvying up the pie, Beijing is busy securing the ingredients to make more pies. The U.S. has become dependent on others by our own actions. The answer is freeing up more supplies here, but the Obama Administration seems intent on breaking the Bush Administration’s terrible record on energy leasing.

I am reading the responses to this blog intently. So far, a couple of things strike me.

“We are facing a massive responsibility to the present and future generations to get our energy systems and other interconnected systems right. If we get it wrong then the national security of this country will be truly in jeopardy …”

Exactly my point. We cannot control everything; but those things we CAN control we MUST control. Even taking out Middle Eastern oil from the import mix; we see very clearly that (aside from Canada) our oil trading partners are from historically unstable countries and/or regions (Angola); are not friendly to U.S. interests (Venezuela); or are running out of oil to export (Mexico).

Seventy percent of this imported oil is used for transportation. We can make an immediate impact on our dependence on foreign oil by making it a matter of national priority to switch from diesel to natural gas for heavy trucks – 18-wheelers – and to make it easier for consumers to upfit or purchase natural gas cars and light-duty trucks.

Utilizing virtually unlimited natural resources like natural gas to replace a significant percentage of oil we are importing from non-Canadian sources should be a national priority.

As I have stated many times, “I’m for anything American.”

We need to tread very carefully when using the government’s taxing authority to drive consumer (or, for that matter, producer) behavior.

As a geologist, I do not believe there are enough crude oil reserves to materially reduce the 12.5 million barrels of petroleum we imported every day during April, 2009.

We have more than 100 years of proven reserves of natural gas in the continental United States. Thus, we need a national effort to move from imported gasoline and diesel to domestic natural gas as our principal transportation fuel.

Oil markets are world markets. Our national security is potentially affected by the energy import structures of our allies and those with whom we have tensions, not just the import structures of our own energy systems. For example, many EU nations rely heavily on gas and oil from Russia, Iran, and Saudi Arabia. EU policies toward these energy exporters are sometimes constrained due to their energy vulnerabilities. Japan, China, and South Korea also rely much on Middle Eastern oil, with Iran and Saudi Arabia being right at the top of the oil sources for Japan and China. Chinese policy toward The Sudan is somewhat constrained due, in part, to its reliance on Sudanese oil. Our policy options toward Iran, The Sudan, and many other oil-exporting states, including Russia, are sometimes constrained due to the constraints imposed on our allies and potential allies on any policy changes or practical pressures to move things in a more positive direction, such as the US attempts at trying to solve the Iranian nuclear conundrum.

We do not import any oil from Iran according to US official statistics, but every time we import anything from another country that does import Iranian oil we are effectively importing Iranian oil. Any attempts at playing tougher with the Russians on some issues could be diluted by the EU’s extreme reliance and vulnerability toward Russian-sourced oil and gas. (The Russian pressure on Ukraine was, in part, based on the very low price that Ukraine got the natural for from Russia. It was a lot cheaper than the going price for natural gas in Western Europe. Russia also had its political motives, surely. Even so, Russia has no real direct energy leverage on the US given that we import almost no energy products from Russia.) However, national security is not just based on what happens inside of one’s country, but is interconnected with the national and energy securities of many other countries.

We import most of our oil from non-Muslim states. This, of course contradicts the common misperception of the sources of our oil being mostly from extremist sheikhs in the desert. Realities are far from this fantasy. Surely imports have been a growing proportion of our oil needs since our own oil production peaked in the early 1970s. But we have a certain amount of diversification of our sources, and most of our oil is not from countries that dislike us.

Most of our oil comes from the Western Hemisphere. Our major sources of imported oil in February 2009 were: Canada (1.9 mbd), Mexico (about 1.2 mbd), Saudi Arabia (about 1 mbd), Venezuela (about 960,000 bd), Angola (about 671,000 bd ), Iraq (about 550,000 bd ), Nigeria (about 500,000 bd), Brazil (about 360,000 bd ) and Kuwait (about 250,000 bd). These put together are about 80% of our imports. Which of these countries dislikes us enough to cut off our oil at some time in the future? We have our troubles with Venezuela, but we are also by far their largest markets for their oil. We take over 73% of their exports. I don’t think Mr. Chavez is foolish enough to cut us off. I doubt he would want to see himself get tossed out of office due to the destruction of his economy this embargo of oil to the US may cause. He is a talented rabble rouser, but he has rather strict practical limits on what he can do.

Let us rule out Canada, Mexico, Angola, Nigeria, Brazil, and Kuwait as countries which dislike us. There are parts of these countries’ populations who do not like out foreign policies and some of our international actions, but they are hardly direct threats to our national security due to their exporting oil to us. We have a certain number of enemies in Iraq, but I don’t think that Mr. Pickens was necessarily referring to Iraq as one of those countries that dislikes us.

Could it be that he was referring to Saudi Arabia? My guess is yes. But Saudi Arabia is a fairly small part of our overall supplies of oil. Out of the 23 mbd we consume, mostly wastefully, only about 1 mbd comes from Saudi Arabia. We have a strong military-to-military relation with Saudi Arabia. We have had a very long-standing, and fairly stable diplomatic and economic relationship with Saudi Arabia since the time of FDR. Granted, we have had our disagreements. There are some persons in Saudi Arabia who support violent extremists. The Government of Saudi Arabia, however, sees Al-Qaeda as an enemy. Osama Bin Laden, whom I call Osama Bedouin Din (Osama without religion), was stripped of his citizenship by the Saudis. They consider him a bitter enemy.

Surely we have our differences in some foreign policy issues with the Saudis, but they have also been cooperative on many levels on many issues, mostly quietly, for decades. They have also worked at times to keep the oil prices moderated, and have acted as a moderating influence in the region at times. They could also be seen as a strong ally in our quest to keep the extremist elements in Iran in check. The argument that our oil import money goes directly into the pockets of terrorists, and that we are “funding both sides of the global war on terrorism” with oil imports is an unproven statement that has taken hold in the public mind without sufficient backup. It plays well in politics and in the press, but it does not hold water.

Furthermore, a lot of the oil money we send to the Saudis goes to the pockets of our weapons exporters, is invested in western or Asian companies and financial markets, or is going to building up the economic cities and other megaprojects in Saudi Arabia, including keeping the oil flowing via the efforts of Saudi Aramco.

The Saudis have also been playing real hardball with their homegrown extremists, and have seriously beefed up the protection of their oil facilities, especially after the 2006 attack on the Ab-Qaiq processing facilities. If that attack succeeded then close to 6.5 million barrels a day would have been off the market for possibly a considerable time period. The Saudis asked for help on this issue, and they got it from many quarters. Our relations with the Saudis are far from perfect, and have some points of tension, such as the Arab-Israeli problems, where we have trouble finding any sort of common ground at times. However, there was a peace process shift that has been sponsored by the Saudi King that has gained some traction here and in the Middle East. Admittedly, there are people in Saudi Arabia who dislike the United States with a passion, but those who run the oil system in Saudi Arabia know how important the US is to their overall well-being. They also remember or know about how the Saudi economy was hammered after the OPEC attempts to blockade the west and the west’s reactions by improving energy efficiency, cutting oil demand, and by non-OPEC production increasing drastically.

Each of these countries who are major oil exporters to the US has their own cultures, foreign policies, economic policies and more. They are sovereign states, and have differing perspectives on some issues. Sometimes they work in alliance with us on some issues. On other issues we have our differences. This is clear with our relationship with Mexico on many levels. They have been, however, very good in their handling of the H1N1 flu virus, and are cooperating more than ever on the drugs and gun-running issues. We could all point to problems that we have had with all of these countries, even our good friends to the north, Canada, who send us a pile of natural gas and electricity also. Consider the trade issue we had with them on soft-wood lumber, the Vietnam deserters and others. No international relations our perfect, but we should not exaggerate those problems in order to change our energy policies. There are more compelling reasons to change our policies, or to be more exact, actually develop energy policies.

None of these countries is in any position to use oil as a weapon against the US. OPEC is a cartel only in name, and the speculators in London, New York, and Singapore probably have more sway on short time prices than any OPEC meeting. Could one see the Brazilians one day cutting off one of their biggest sources of foreign exchange in response to some policy by the US? Right now that seems an obscure proposition.

However, there are some things we need to consider for the future. One of the most important is that close to 60% of all known conventional oil reserves are found in the Persian Gulf and this area will most likely be the last to peak. Many of the others on our list of major oil exporters to us will peak a lot sooner than some would hope, and some, such as Mexico, have already peaked given the knowledge that we have now, and the economic structure of PEMEX. As oil runs out in many of the smaller sources of oil, such as in Nigeria, Brazil, Angola, etc. the more important the Persian Gulf will become. Tensions in the region may spark different scenarios.

Another thing to consider if we are to start to cut back on our use of oil too quickly: we may spur some extreme instability in the Persian Gulf and in those other countries that rely on oil revenues and on remittance labor that works in the Gulf and other oil producers. We may spur, for example, further instability in some of the smaller oil states, such Nigeria and Angola, who are extremely reliant on oil revenues. Moving too quickly from hydrocarbons could also do significant damage to the Russian economy, if they do not sufficiently diversify before the inevitable happens.

The inevitable is that oil will peak and that production will find its limits. This is the case even if we consider heavy oils, tar sands, and oil shale. These non-conventional oils also bring with them extreme environmental implications, with significant costs at many levels.

So we are facing down the real national security threats to the US. These are not that we are importing oil from countries that do not like us. These are the dual and potentially very threatening effects of peak oil and global climate change. Global climate change is a direct result of the use of fossil fuels, and oil is a big part of this. Senior national security leaders like Generals Zinni and Sullivan, Admiral Truly and more have seen this on the horizon, and have wondered, really, how close that horizon truly is. Peak oil will become a much greater threat if we do not start to pre-plan for it now.

Another set of energy related national security issues directly related to the oil trade can be found in the inexorable power of geography. About 45% of all oil is transported by ship. 15 mbd goes via the narrow Straits of Hormuz. About 12 mbd goes via the treacherous Straits of Malacca and the Singapore Straits. 3 mbd goes through the straits near the Bab Al Mandab off of Yemen. 3 mbd crosses the Suez Canal. 3 mbd goes via the Bosporus Straits. The list goes on an on.

Many important oil pipelines and other facilities in the world are more vulnerable than many would like to think. The ABOT terminal off of southern Iraq ships about 85% of Iraq’s exports, and it quite vulnerable. Many major pipelines coming out of Russia are vulnerable. The Port of Houston is not exactly a bastion of security either, and we import almost 1/3 of our crude to be refined here into that port. The LOOP off of Louisiana is a target, and a large source of our crude imports.

The list of oil infrastructure vulnerabilities, well, that is the sort of list that can keep me up at night. These are real oil-based national security threat zones. A less centralized and less geographically dense energy system would be a lot less risky. The supply chains for oil for the US, and for the rest of the world, are often in limited geographical bands, and are ripe for the targeting for any non-state group that has a bad idea. Al-Qeada and OBL have made statements to the effect that they have these nodes in their sights. The sooner we move away from oil and such a non-robust supply chain system the more secure our energy and economic systems will be.

I agree with Mr. Pickens that we need to move from oil, especially in transportation, which is the biggest user of oil in the US, and by far the most inefficient user of oil in the US. For every gallon that goes into the typical US auto only about 5-10% is used to move the passengers and cargo. The rest is mostly wasted energy. Light-weighting of the cars, building carbon fiber cars, moving to real hybrids, moving to electric cars with the electricity based on a smart-grid system indeed may be one of the ways to go to battle the energy-environment based national security threats looming. Right now we have a dumb grid. About 85% of the fuel put into producing electricity goes up in the air has heat. Even more is lost in transmission, distribution, and splitting the lines near houses, factories, etc.

There are clear and present dangers heading toward us due to our reliance on oil. These clear and present dangers are not due to whom we are importing from. They are from how much our economy and society relies on an uncertain commodity which also has sometimes very volatile prices, will peak, helps create global climate change, and has potentially very fragile supply chains. All of these fragilities in the oil-based energy systems potentially can have extreme effects on our people.

Should Congress address these issues with legislation? The answer, of course, is yes. But it is imperative that the legislation does not do more damage than good, and that it is based on facts and science, rather than on populism and the race for the next vote or campaign contribution. Legislation directed at the looming threats of peak oil, global climate change, and the potential fragilities of the oil supply chain could be a very important set of next steps to move us toward the new energy future that is a requirement for the national security of this country to be maintained and preserved. Such legislation could be drivers to the new energy future.

Above all, the best of American values need to be reflected not just in our energy policies, but our overall domestic and foreign policies. Trading off our values for the next barrel of oil is unacceptable.

The time to move toward our new energy future is now. We cannot doddle on the side lines and look for excuses to kick the can of change down the road to the next leaders or the next generations. We are facing a massive responsibility to the present and future generations to get our energy systems and other interconnected systems right. If we get it wrong then the national security of this country will be truly in jeopardy and the economy as we know it could become so fragile that the economic crisis we face today will seem like a walk in the park in the rain, rather than the whipsawing high gusts of economic instability we could face from the twin towers of oil-based instability: peak oil, global climate change, and potentially very fragile oil supply chains.

The opinions expressed by Dr. Sullivan are his alone.

For decades, our dependence on foreign oil (and the unstable countries that produce it) has been growing – and sometimes this trend has been made worse by congressional actions that have penalized American oil and natural gas producers. For example, according to the Congressional Research Service, the 1980 Windfall Profits Tax on American oil and natural gas producers “reduced domestic production from between 3 and 6 percent and increased oil imports between 8 and 16 percent.” The tax also drained $40 billion from these American companies that otherwise could’ve been invested in new energy supplies here at home.

The current Congress should learn a lesson from past mistakes. As it crafts an energy bill, the Congress should reject proposals (such as the Obama Administration’s budget) that would increase taxes on the American oil and natural gas industry. It should be U.S. policy to encourage, not discourage more American energy from all sources. This is the only way we can reverse an ever-growing and dangerous trend of reliance on foreign oil.