Energy:  Fast facts for an unconscious nation - oil, dollars, cars and CO₂

I am a research scientist and I have been considering buying a new car. Being nominally overeducated, fascinated by efficiency, and a compulsive researcher I set out to understand the pros and cons of different new fuel options (gasoline, ethanol, bio-diesel, electric) with respect to cost effectiveness and carbon dioxide (CO₂) emissions. As my inquiry proceeded I discovered a quantitative theme connecting car and fuel choices to the US trade deficit and jobs, national security, oil industry subsidies, national debt, global warming, and democracy. Being moved by my discoveries I decided to make a quantitative summary that connects these themes together for a popular audience. An engineer would call this summary a back of the envelope calculation. The numbers I provide in this summary are representative of the overall size of quantities discussed; they vary from year to year and with the price of oil and reference source. My focus and purpose is on principles, ideas and the big picture and the details. As I use many numbers to evolve the theme the reading can be tedious to non-technical readers and I present “Factoid” breaks between sections in this little horror story.

FACTOIDS: fuel for thought to keep the reader engaged

The average American car and driver produces 5 tons of CO₂/yr: 5 tons fills one football field 20 inches deep in CO₂ every year if burning gasoline.

Total annual US CO₂ emissions from all personal vehicles fills an area the size of Nevada or Colorado 7 ft deep in CO₂ emissions. Maryland to the height of a 5 floor building,

Hidden costs and oil industry subsidies, $700 - $800B, are in the same order of magnitude as the average annual increase of national debt during the 2000-2005 time frame or about $450-600/yr, the trade deficit $776B (projected 2006) and larger than the Pentagon budget, in the range of $420-440B.

One 500 watt highway light burning 12 hours a night all year produces (conservatively) 3 tons of CO₂/yr when powered by coal fired electricity. 

I). Setting up the big picture: US energy, US jobs, personal vehicles, CO₂

In this section various numbers regarding overall US energy consumption are put together. References to the data used are provided as web links; when not provided they can easily be found by Google search with relevant keywords. The abbreviations yr=year, lbs=pounds, brrl=barrels, M=million=10⁶, B=Billion=10⁹, T=Trillion=10¹³ are used.   

Trade deficit, oil and jobs: In 2002 energy imports were about 24% of the US trade deficit, $483 B. Currently (08/06) the trade deficit is running at a rate that will make it about $776B for 2006. The largest contributor to the US trade deficit is oil. Primary US consumption by fuel is about 40% oil, 24% natural gas, 23% coal. About 7.5% of total energy is used to refine oil into various products (gasoline, diesel etc.). The numbers I have given are from 2004 [see eia.doe.gov – a very good site]. Lets study oil as it impacts the 1) trade deficit, jobs and national debt, 2) people’s pocketbooks 3) CO₂ emissions and global warming 4) is heavily subsidized and 5) is most easily affected by the average citizen by car and fuel shopping choices. 

US Oil consumption and Exxon profits: Oil is consumed by the US at a rate of about 20M barrels/day = 7.3B barrels/yr up from 15M/day in 1983. At $65/barrel this is $1.3 B/day = $474B/yr. To put the $474 in comparative context: Exxon’s last 12 months revenues, as of 9/06, were $384B. About 60% of the oil, 12M barrels/day [eia.doe.gov], is imported, say about $284B/yr at $65/barrel. Oil imports appear to have increased to 36% of the projected 2006 trade deficit. 

DOE (Dept. of Energy) estimates that every $1B in trade deficit costs the US 27,000 jobs. NDCF (National Defense Council Foundation) has an estimate that US has lost 800,000 jobs due to dependence on foreign oil. [Google: cost of oil at iags.org].

Applying the DOE figure suggests that the $284B current cost of imported oil ($65/barrel) is costing about 7M US jobs. Regarding the loss of jobs, the number of people living in poverty, according to government statistics, is now about 5.4M people, up 17% since 2000 when crude oil was under $20/brrl.  

US Oil consumption and CO₂: The primary associated with global warming is carbon dioxide, CO₂ [search @epa.gov for a global warming primer]. Burning oil at the current US rate of 20M brrls/day is equivalent to filling Connecticut 3 inches deep with oil and lighting it on fire once a year. This can be expected to have an environmental impact especially if repeated every year. Burning 7.3B brrl/yr of oil produces some 3B tons of CO₂ /yr about 50% of the total 6B tons/yr emitted by the US in 2005 (epa.gov).  (This figure does not include the CO₂ produced by refining oil.) The rest of US CO₂ emissions are due, primarily, to natural gas and coal. US CO₂ emissions are growing at some 19%/yr. [Google: inventory green house gasses @epa.gov]. The well accepted figure, that approximately 20 lbs of CO₂ are produced for every gallon of oil (or gasoline) burned has been used.  

Oil and CO₂ costs of US passenger vehicles: Of the 20 M barrels/day of oil consumed in the US about 43% is refined into gasoline, 24% into diesel, 10% into jet fuel and other small stuff. Thus total personal (gasoline) vehicles consume about 9M brrls/day = 3.3B barrels/yr. At $65/brrl (9/06) fueling a personal vehicle the US spends $213 B/yr and creates 1.3B tons of CO₂/yr, about 22% or about 1/5^th of the total US CO₂ emissions. Lets make it personal. 

Your vehicle’s gasoline and CO₂ costs: The average fuel economy of the average American’s personal vehicles (passenger cars, SUVs, Hummers, imports included) is 21mpg, the same that is was 20 years ago. As a consequence the average car driven 10,000m/yr (a low figure) at 21 mpg costs $1430 for fuel (at the subsidized cost of $3/g) and produces close to 5 tons of CO₂/yr. A Toyota Land Cruiser SUV produces 7 tons of CO₂ annually; a Hummer 10 tons CO₂/yr. Producing 5 tons CO₂/yr the American gasoline powered automobile, is at this time, a filthy method of transportation. The average American gasoline car is also very inefficient: only about 15-20% of energy in fuel is converted into motion. In comparison electric vehicles have efficiencies on the order of 85% and diesels in the range 40-50%.  

FACTOID BREAK: CO₂ emissions

Every gallon of oil (gasoline, diesel) you burn produces about 20 lbs of CO₂.

The average American car, at 21mpg, produces 5 tons of CO₂/yr. At about 2kg/ m³ one ton of pure CO₂ occupies a volume measuring 25 ft on a side or 4 inches deep of a football field (without end zones). Five tons of CO₂ fills a football field 20 inches deep of CO₂. A Hummer’s annual CO₂ emissions would waist deep on a football field.

Total annual CO₂ emissions of personal vehicles alone will fill a land area the size of Nevada or Colorado (105,000 sq miles) to 7 ft deep in CO₂ emissions; Florida to 12 feet deep, Maryland to the height of a 5 floor building, Connecticut to the depth of a 12 floor building.

Every kWhr of electricity you use from a coal fired plant produces between 1.64-2.15 lbs of CO₂. Thus very $100 you spend on home electricity from coal, at $0.08/kWhr, is conservatively one ton of CO₂. (I have used the lower 1.64 figure).

You will suffocate if you breathe only CO₂ and the more CO₂ in the atmosphere the hotter the planet gets and the more unpredictable the weather. 

Oil summary:  The US consumes 20M brrls/d: 9M brrls/day for personal vehicles, 5M brrls/day for diesel applications. Of the 20M about 12M barrels/day are imported. In 1983 US consumption was 15.2M brrls/day.

Trade deficit summary: Energy imports, about 24% of the 2002 trade deficit is now 36% of a trade deficit of a projected $776B in 2006 or $284B (at $65/brrl). According to a DOE estimate the $284 oil deficit figure suggests a loss of 7M jobs. If the DOE estimate is even half right this appears cause for concern.

CO₂ summary: The US emits a total of 6B tons of CO₂/yr. This about 25% of the worlds CO₂ emissions for about 5% of the world’s population. 3B tons are due to burning of oil and its products. One average American car produces 5 tons CO₂/yr. All American passenger cars produce about 1.3B tons of CO₂/yr.

What does it mean: The average American car is very inefficient and a major source of CO₂ emissions. The US is sending money overseas for foreign oil at a rate that is the same order of magnitude as the national deficit. 

FACTOID BREAK: Global warming is real. From Hanson.

The Pentagon has a 2003 study called “An Abrupt Climate Change Scenario and its implications for US National Security”. In it possibilities and consequences starting as early as 2010 of a strongly destabilized global ecosystem due to a rapid climate change scenario are outlined. The report was suppressed by Bush until it was leaked to The Observer in the UK.

Firms whose profits are affected by it are concerned. Shell oil has raised its ocean platforms six feet higher above ocean as a consequence of more extreme weather events and the higher sea levels that accompany global warming.

Insurance companies are concerned that human induced climate change may bankrupt the industry. [Google: UNEP The Statement of Environmental Commitment by the Insurance Industry].

One 500 watt highway light burning 12 hours a night all year produces (conservatively) 3 tons of CO₂/yr when powered by coal fired electricity. My highways exit, in Santa Fe (8 lights on each of 4 ramps), produces about 75 tons CO₂/yr. Does anyone besides CEO’s of construction or power companies need all those lights. 

II). Fuel economy: demand side strategies and efficiencies

I now make clear the possibilities and consequences of increasing the fuel economy of passenger cars within the context of the oil based personal transportation model.  

Increasing CAFE according to the 1985 goal of the 1975 “Energy Policy Conservation Act”: What would happen if the average American passenger car could increase its mileage a modest 30% to 28 mpg and meet the 1985 CAFE (Corporate Average Fuel Economy) standard ? Note that SUVs and Hummers and vehicles over 8,500 lbs do not have to meet 1985 CAFE EPCA standard of 27.5mpg and they are included in the figure for the average American passenger car. At 28 mpg this would reduce fuels cost $350/yr/vehicle, or 25% to $1055/yr. In addition CO₂ emission would be reduced by 25% to 3.5 tons CO₂/yr per car. Those are the sizable consequences of increasing passenger car fuel economy by a modest 7mpg.  A good discussion on how US automakers have continuously stalemated increasing CAFE standards by litigation is given by Richard Byrne @ucsusa.org.  

Nationally the US would consume 0.8B/yr barrels less and pay $160B/yr rather than $213B for gas for a net savings of $50B/yr. By comparison Exxon’s profits (not revenues) were $36B in 2005. A modest 0.8B brrls/yr less would also reduce the reliance on foreign oil by about 17%. 

A modest 0.8B brrls/yr less since 1985 would add to a total savings of 16B barrels over that 20 year time period. 16B barrels is about 1.6 times as much as what oil company’s are pushing the government to obtain by drilling the delicate Artic National Wildlife Refuge. Total US personal vehicle CO₂ emissions would be reduced by 25% to 1B tons/yr. Over the 20 years since 1985 Congress had a chance to reduce US CO₂ emissions by 6B tons in the atmosphere by simply enforcing the intention of the 1985 CAFE law. 

How to increase US CAFE for all personal vehicles to the 1985 guideline: How can the US increase fuel economy to accomplish this modest increase. Clearly the US car companies have not been interested in this: they have been litigating against it for 20 years and appear currently too busy with major amounts of red ink. It would not be difficult to achieve this fuel economy increase if the US had access to cars sold in Europe. The VW Lupo diesel gets 90 mpg; the Audi A2 diesel 87 mpg; the Opel ECO speedster 92 mpg. The Honda Accord 2.2 i-CTDI diesel, sold in the UK since 2004, gets 90 mpg. About 50% of the cars sold in Europe are diesel; in the European luxury car market it is about 85%.  It appears simple, in principle, to bring the American average fuel economy up by 7mpg: only one about five people would have to buy such a car. 

FACTOID BREAK: automobile industry,

To give a comparison to the 21mpg of the average US car: in 1908 the Ford model T is reported as having gotten 25 mpg. It could run on gasoline or ethanol.

Diesel engines are more efficient than gasoline and easily get hybrid type mileage.

The Volkswagen chairman Piech drove to a VW stockholders meeting in Hamburg Germany in a diesel car that got 310 mpg.

The national government appears to be stimulating a US  “addiction to oil” and subsidizing directly the profits of AMG-GM on high profit margin Hummers. The tax break for a business on a Hummer has been reported to be as high $90,000. As of 2004 it was estimated that the Hummer tax subsidies have cost the US treasury $1.3B. The American taxpayer appears to be buying Hummers. [Google: hummers tax breaks]. 

Consequences of increasing fossil fuel car efficiency to 60mpg: A large jump in personal vehicle fuel economy, along the lines of a Toyota Prius or the European diesels would decrease what the US pays for oil for transportation from $213B/yr to $62B/yr: this is a $151B drop of which very casually say 30% is taxes. Oil industry revenues would decrease $100B and taxes $50B.  

If you had such a European diesel car your gasoline bill would be a mere $430/yr (at $3/g and 70 mpg) and not $1430/yr, some $1000 less per year. Not a small sum especially for those with the median US income of about $45,000 or less. Personal vehicle annual CO₂ emissions would drop 70% from 5 tons/yr to 1.4 tons/yr. Nationally personal vehicle CO₂ emissions would drop 70% to 0.4B tons/yr reducing overall total US CO₂ emissions from 6B to 5B tons/yr. Americans would pay $62B/yr for fuel and not $213B/yr a decrease of $151B/yr in revenues for the oil industry and government.  

Comment on replacing diesel consumption with bio-diesel: This has been a discussion primarily on personal vehicles and gasoline engines only. If diesel modes of transportation (truck, train, boat) ran solely on B100 bio-diesel made in the US (which can be done with current engines without modification) then 1) 5M brrls/day or 41% of imported oil would be eliminated and 2) loss of jobs due to importing oil would be reduced 3.2M jobs (using that DOE estimate) and 3) total US CO₂  emissions would be reduced 13% to 5.2B tons/year. The bio-diesel industry has a huge potential for growth: In 2005 net production was 90M gallons or 6,000brrls/day. In comparison diesel is consumed at about 5Mbrrls/day – a factor of 1000 based on the current diesel consumption. This factor does not include a possible shift of personal vehicles to diesel. Honda has announced and intention to market a passenger diesel in the US; VW, which has stopped selling diesels for 2007, is apparently retooling for the year after. 

FACTOIDS: fuel for thought and alternative fuels

The total annual CO₂ emissions of all diesel vehicles in the US will fill a land area the size of Georgia (about 60,000 sq miles) to 7 ft deep in CO₂  emissions, every year; Maryland to 3 stories deep in CO_2.

Amount of energy you get per unit of energy expended to extract, grow, process, transport and distribute typical fuels are: gasoline=0.74, diesel=0.84, corn ethanol=1.3, bio-diesel= 2.2. These figures are called, in the media, net energy balances and there are several versions of these estimates. The low figure for gasoline is due the energy construction and distribution costs for ships, ports, refineries, pipelines. The estimate for gasoline does not include US military costs. Cellulosic ethanol is still experimental but estimates are coming in at 2-3.

Ethanol and bio diesel are in principle carbon neutral: they consume about as much CO₂ as they produce. In current practice this is not true as fossil fuels are still used somewhere in their growing, harvesting and especially distribution by diesel truck. Ideally these diesels would use bio-diesel. In contrast oil is pipelined in and then distributed by local truck.

To add a somewhat positive piece of information to these little horrors of efficiency the average fleet economy in 2004 of new passenger cars in the US is purported to have increased to about 29mpg. The same figure for France is a currently 46mpg. Consider also that over about the last 30 year period average fuel economy of French cars has increased by more than 20% to around 6.5 l/100km, or 43 mpg.

More positive news: the California attorney general is going to sue the automakers for global warming. 

CAFE of 28 mpg summary: Increasing the average US fuel economy of personal vehicles only 7mpg to a mere 28 mpg 1) reduces oil consumption by cars 22% or 2M barrels/day, produces a $50 B/yr consumer savings 2) reduces by 17% foreign oil imports, 3) reduces loss of jobs due to importing oil by about 1.3M jobs (using that DOE figure at $65/brrl) and 4) reduces US CO₂ emissions by 300M tons/year (5% of total of US CO₂ emissions). For the individual this would 1) reduce fuels costs by about 25% or about $350/yr/vehicle and 2) reduce CO₂ emission by 25% to 3.5 tons CO₂/yr.

CAFE of 60 mpg summary: Increasing the average US fuel economy of personal vehicles to 60 mpg (of say a European diesel) 1) reduces oil consumption by cars 65% from 9M brrls/day to 3.2M brrls/day produces $150 B/yr US savings (at $65/brrl) 2) reduces by 50% foreign oil imports, 3) reduces loss of jobs due to importing oil by about 3.8M jobs (using DOE estimates) and 5) reduces US personal vehicle CO₂ emissions by 65% from 1.3 B tons/yr to 0.46 B tons/yr. The overall total US CO₂ emissions would be reduced 15% from 6B to 5.1 B tons/yr. The average gasoline bill would be $430/yr (at $3/g and 70 mpg) some $1000 less per year per car. Personal vehicle annual CO₂ emissions would drop 70% from 5 tons/yr to 1.4 tons/yr.

What does it mean: Increasing fuel economy to European diesel or Prius class standards and fueling all diesels on bio-diesel comes close to reducing any dependence on foreign oil at current US production and consumption rates. If one were an engineer and had to design an energy system from scratch for the US, given the net energy balance and automotive efficiency, oil and the internal combustion engine would not be a strong contender for an energy efficient transportation sector. 

III). Oil revenues: national debt, oil industry subsidy, wealth gap

In my inquiry I discovered various suggestive facts about the economics of oil and how they may be related to various socio-economic trends in the US.  

Rhetorical question: Why doesn’t the US have cars with European fuel economies ? The answer one might speculate, given the potential $151B drop in revenues, that private corporate interests and CEO’s not public interests run the nation. It will be hard to stop the various lobbying machinations that resist the inevitable US move from an oil based economy. The US automaker have quite effectively, though not scientifically, litigated against increasing fuel economy for 20 years (see literature by Union of Concerned Scientists ucsusa.org). Here is an example of what such lobbying and automotive inefficiencies can produce: the Exxon chairman, Lee Raymond, obtained a $400M and perks retirement package. His 2005 salary was $144,000/day. Incidentally the US has 1) the largest wealth gap between the richest and poorest, 2) the highest poverty rates (12%), 3) the most people in jail per capita and 4) by far the most children growing up in poverty of any developed nations. 

FACTOID BREAK: income disparity related facts

Congress has not raised the minimum wage in 8 years. In the same 8 years it has raised its own salary 8 times. One might speculate that lobbies for minimum wage employers are much stronger than lobbies for minimum wage earners.

Number of people living in poverty is up 5.4M or 17% from 31.6 M in 2000: 37M people (many with jobs – thus transparent to employment statistics) live in poverty in the US.

Child poverty rates, before or after tax subsidy and transfers, are higher in the US than any other “developed” nation: US:21%. Average of 16 developed countries: 10%. Scandinavia: 3.2%. [see epinet.org].

The average middle class family’s income has fallen five years in a row since Bush took office in 2000. [see hightowerslowdown.org].

On average the average CEO currently makes 431 times what the average worker makes. Exxon’s CEO is much higher.  In 2003 the number was 300. In 1982 it was 42. [Google: CEO pay gap to study this]. 

Oil revenues in the context of national debt: To put this $151B drop in oil revenues in the government spending perspective: the current maintenance of the Iraq war, as many observers argue a war for oil and accompanying corporate profits, [see halliburtonwatch.org], costs about $96B/yr at a reported $8B/month [see hightowerlowdown.org]. Tax receipts on the $213B, very loosely 30%, go from $64B/yr to $18B/yr, a drop of some $46B/yr. One might speculate, that with national debt increasing at historically high rates, a tax revenue drop of $46B/yr, which pays for about half of the Iraq operation, is important. US debt is estimated to be rising at about $1.70B/day (brillig.com/debt_clock/). A private sector comparison might be the total tax savings 18 rich American families appealing the estate tax laws (WalMart, M&M, Campbell Soup, Gallo etc) may obtain if successful. A savings of $71B is reported -- a good portion of the annual cost of the continued Iraq operation.  

All peanuts compared to the national debt currently estimated for 2006 to be $8.5T up 51% from $5.6T when Bush took office in 2000. Debt appears likely increase from 57% of GDP in 2000 to 77% of GDP sometime in 2007. In the same period the national debt has grown 51% the economy (GDP) has grown 12%. Annualizing those growth rates: the national debt is growing at almost 8%/yr, the economy (GDP) at 3%. The national debt will surpass the GDP by 2012 if this continues. As they say in the popular literature, it appears the US is burying future generations in debt.  

FACTOID BREAK: the national debt

Every man woman and child currently starts life with a debt of about $28,000 up 40% from about $20,000 in 2000.

The US has gone from the 40^th most debt laden country in the world to about the 20^th. This is using the measure of debt as a % of GDP amongst 114 countries [Google: cia world fact book].

Various students of government accounting machinations estimate the deficit in the range of $620B/yr. This higher figure includes the Social Security collections the government uses for current costs and does not appear to be setting aside for payments to future retirees.

The recent “official” deficit figure, a month before the 2006 elections, is half the size I give above. I have used the average figure working from the total debt increase from 2000-2006.  

Where does all the US debt come from ? The following figures lead to some useful speculations. Federal contracts in 2005 are up 86% since 2000. Federal spending on Halliburton defense contracts are up 600% in that same time (halliburtonwatch.org). Halliburton’s profits are up 380% since 2000 with current revenues of $22B a 50% increase in revenues since 2000. Similar studies can be done of Lockheed Martin. Compare this to the proposed 2007 Pentagon budget of $443B (up 63% from $270B in 2000). The Pentagon budget, it appears, does not include the cost of the continuing Afghanistan and Iraq aggressions. Iraq has so far cost $295B (07/06) (estimated originally by the White House to cost $50B). The economy has grown in that same time frame by 12% or about 3% annualized. I am reminded of the quote, “Let us all be happy and live within our means even if we have to borrow money to do it” -- Artemus Ward (1872).  

FACTOID BREAK: CEO’s war profiteering and humorous quotes

CEOs at the largest defense contractors have received a 200% increase in salary since the 9/11 terrorist attacks, compared to a 7% increase for chief executives at other large companies. [Google: CEO compensation and war profiteering].

Halliburton in Iraq pays a foreign national about $6/day and charges the US taxpayer $50/day. [See hightowerlowdown.org, halliburtonwatch.org].

During 2001-2005 Dick Cheney has apparently received compensation in the range of $160,00-210,000 per year from Halliburton. Cheney is on record for having said he has severed all ties with Halliburton. [See hightowerlowdown.org].

“No one in this world has ever lost money by underestimating the intelligence of the great masses of the [American] people. Nor has anyone has ever lost public office thereby.” H. L. Mencken (1940’s).

Bush emulating Abraham Lincoln: “You can fool some of the people all the time and those are the ones you have to concentrate on” (2001 Washington Gridiron dinner). 

Tax subsidies for the oil industry: It has been, historically, the intention of governmental tax subsidies to help establish new technologies or to support essential industries against market swings. Oil is a mature and a very high profit margin industry; why does the US subsidize oil ? Exxon has a return on equity of 37%, return on assets of 20%, a quarterly revenue growth of 12%, and a quarterly earnings growth of 35% [see finance.yahoo.com]. Hardly the sign of an industry requiring subsidy. There are fuel and fuel economy alternatives that are cost competitive with gasoline that are expected to create jobs that require technological development and subsidization until economies of scale can be reached. These are not subsidized even a fraction of the oil industry rate. Various organizations have estimated oil industry tax subsidies to be about $5-$15 a gallon of gasoline [see distributiondrive.com/Article4.html or icta.org]. Let’s assume the lower number and do an unrealistically conservative estimate: at $5 tax subsidy per gallon of gasoline the $3.3B barrels/yr costs the taxpayer $700B/yr. A more recent estimate by National Defense Council Foundation [Google: ndcf.org & Copulus] is $790B. Compare, say $800B in oil subsidies, to the proposed Pentagon budget of $443B, the estimated 2006 trade deficit of $776B and the current annual increase in national debt by $450-620B/yr. If the subsidy figure were double at $10/gallon eliminating subsidies would be $1.4T/yr debt load decrease and would start impacting the national debt. Compare the $800B in oil subsidies to the $39B proposed for K-12 grade education or the $2B for reduction of reliance on foreign oil (see truemajority.org). See Hanson, “Energy Power Shift” for subsidy itemization. 

But most interesting is that the tax subsidy to the oil industry, whether $700B or $790B, it is much larger than $474 B/yr that is paid for oil even at the recent $65/barrel. I speculate how long a nation can remain internationally competitive or even solvent with an overhead charge of such magnitude. There are economic and environmentally useful alternatives. 

National debt summary: Debt is increasing on average over the 2000-5 time frame about $450-620B/yr depending on how one accounts Social Security costs. Since the last year there was a budget surplus (1999), debt has increased at 8%/yr and the economy has grown at 3%.

Oil subsidy summary: Hidden costs and subsidies to the oil industry, estimated at $700 - $800B/yr, are sizably greater than what the US pays for oil, about $474 B/yr (at $65/brrl). Larger than 2000-2005 average annual increase of national debt of about $450B/yr, much larger than the Pentagon budget, and about the same size as the projected 2006 trade deficit, $776B. And much larger than the $2B budgeted in 2004 for the reduction of reliance on foreign oil.  

Oil subsidy summary: With national debt load increasing on the average $450-620B/yr and oil subsidies about $800B, if one were a conspiracy aficionado, it looks like the national debt is subsidizing the oil industry profits. Or to put it differently (heretically and somewhat simplistically) one could reduce national debt and eliminate the deficit by eliminating oil industry subsidies. 

IV). SUMMARY:

There are four primary reasons to reduce or (even better) eliminate fossil fuels from your energy diet: 1) reduce the US trade deficit and associated benefits 2) the national security issue of reducing reliance on foreign oil, 3) reduce CO₂ and its contribution to global warming, 4) save yourself money. 

What did I do ? From my research I have concluded that my environmental values and hard scientific evidence are not represented by the national government whose choices appear determined by corporate interests. [It appears that Hummer tax breaks have gotten even better and the national government appears more corrupt than I recall it ever being]. There are some very positive signs with the actions state governments are taking and the US Mayors Climate Protection Agreement is a very exciting [seattle.gov/mayor/climate/] grass roots effort. Talk to your mayor, governor, senator, and congressman, I am sure with enough repetition the various levels of government will move in the direction consistent with innovation, change and scientific evidence and engineering merit. To quote H L Mencken: “If a politician found he had cannibals among his constituents, he would promise them missionaries for dinner.”  Nonetheless it appears to me, in a system where private not public interests determine most of the policy, the only real possibility for change lies at the grass roots level. I am reducing all my fossil fuels intake with the intention to eliminate them all together starting with domestic hot water, space heat and then electricity. It is not at all difficult if you are disposed to a little research and critical thinking. 

Here is what I did: I drive a lot of highway miles and only nominal city miles for which hybrids appear more appropriate. I considered electric cars but currently coal (the primary source of electricity is 1) inefficient about (20-30%) and 2) very very polluting (mercury), 3) creates a lot of CO₂ (1.6-2.13 lbs/kWhr), 4) leads to a centralization of energy and bloated CEO salaries, 5) has inflicted unimaginable environmental and social damage in the Appalachians. 

I have installed a flexfuel retrofit kit in my current Saturn [available at fullflexint.com] to use even 100% ethanol. To a reasonable percentage ethanol is an American product, has a positive net energy balance, and (in principle) is carbon neutral and becoming locally available [see afdcmap2.nrel.gov/locator/]. I hope in time that the diesel trucks that transport ethanol use 100% bio-diesel and that the more efficient cellulosic ethanol becomes available. I hope in time that American farmers will form more coops rather than let Cargill and Archer Midland Daniels, with their very poor environmental records and reliance on fossil fuels, dominate production and profits. At this time my ethanol comes from a farmers coop in the next state. The retrofit kit cost me about $400 and will allow me to delay a new car purchase. With the ethanol retrofit kit I join a grass roots movement now gathering momentum to reduce 1) US trade deficit 2) reliance on foreign oil, and 3) CO₂. I won’t save myself any money until the high mileage (60-90mpg) European style diesels (ideally hybrid diesel) are brought to the US for me to switch to B100 (100%) bio-diesel made in the US. This appears to be likely to be a VW or Honda diesel in the next few years given the PR I have seen.  

J R Ristorcelli, Oct 30, 2006.

REFERENCES:

Google: Facts can be verified by Google search with appropriate key words.

http://www.eia.doe.gov/

Hightower, J., P. Frazer. “Hightower Lowdown” newsletter.

Hanson, B. (2004). “Energy power shift”.

Tickell, Josh (2006). “Bio-diesel America”.

Scheckel, Paul (2005). “The Home Energy Diet”. 

FACTOID ADDENDUM: National Artic Wildlife Refuge, drilling public lands

The exploitation the NAWR will yield less than 2 years of oil (10.3B barrels) at current US consumption rates. In contrast increasing personal vehicle average mileage by 7mpg (to use the example above) would save us drilling the NAWR and attendant costs in 13 years. It will take much longer than that to get the oil out of the ground.

Had the 1985 CAFE been instituted (as intended) the 7mpg increase would have saved 0.8B brrls/yr since 1985 for a total savings of 16B barrels: about 1.6 times the delicate National Artic Wildlife Refuge.

Burning the oil obtained by drilling the ANWR will produce 4B tons of CO₂ .

The Department of the Interior is taking steps to dramatically increase, even further, “energy production from our federal lands in an environmentally sound manner”. Just ask Lin and Tweeti Blancett of the six generation 32,000 acre Blancett ranch Northern NM about “environmental sound manner”. Fly over the Colorado’s Roan plateau and you will see what an “environmental sound manner” means.  Or Wyoming’s Red desert. Or Utah’s canyon country.

“According to the Inventory of Oil and Gas on Federal Lands report released in 2003, the Rocky Mountain Region is considered to have the largest untapped onshore natural gas reserves in the country. The estimates of 138 trillion cubic feet of natural gas on Federal lands in the Interior West is sufficient to heat all of the 55 million homes that use natural gas in the United States for 39 years.” This is of course misleading: the US consumes gas at a rate of about 22Tcf/yr (in 2005) and the figure about will supply the US for six years at current consumption rates of industry, commercial and residential combined.

There is nothing environmentally sound about natural gas either: per million BTUs of energy it produces 117 lbs CO₂ while gasoline and oil about 160 lbs. Natural gas is only 30% less global warming than oil. It has not business being called a clean fuel for the CO₂ standpoint.