As oil spill damages Gulf, will U.S. change energy use?

McClatchy NewspapersMay 28, 2010 

WASHINGTON — The Gulf oil spill has triggered a crisis of confidence, shaking Americans' views about BP, the oil industry, technology and President Barack Obama and slowing a planned expansion of domestic offshore oil drilling.

Are the worst spill in U.S. history and images of dead birds and toxic syrup lapping at Gulf shores shocking enough to be a tipping point for energy policy and consumer behavior, however?

Will Americans rush to smaller cars or spend more to buy hybrids? Will politicians embrace gas taxes and charges on large carbon polluters or adopt other measures to punish fossil fuel-burning and encourage alternative energy use?

Although BP has abandoned its latest attempt to stop the spill, the company is trying another approach, and it's probably still too soon to say. Public willingness to change — and the political courage to provoke change — may hinge on how long the spill continues, how the wind blows, how the cleanup goes and the extent of damage to wildlife, seafood, jobs, tourism and real estate.

The debate also comes as the nation is emerging from the worst economic crisis in decades, saddled with debt, trying to wrap up two wars and embarking on an experiment in health care that's left many Americans unsettled and businesses bracing for higher taxes. It also comes as key developing nations, including China and India, rely heavily on oil and coal to drive their expansions.

For now, many experts say Americans aren't ready to change.

"I don't think it's a game-changer," said Antoine Halff, the head of commodities research at Newedge, a New York-based brokerage firm. "It drives home the risky nature of meeting the demand for oil," but he predicted that perspective largely would be offset by a more powerful reflex: "People like to have their cake and eat it too."

Even the most cautious analysts expect the crisis to lead Americans to embrace greater government regulation of offshore drilling and perhaps to expedite higher fuel-efficiency standards for cars and trucks.

Advocates of a faster transition from an oil economy to alternative energy are seizing the opportunity to push for as much as they can get.

"Perhaps in the face of this terrible crisis we can find the political will and the political leadership to get it done," said Kevin Knobloch, the president of the Union of Concerned Scientists. The National Resources Defense Council Action Fund has launched ads in eight states pressuring senators to pursue a "strong clean-energy climate bill."

The searing images of the spill already are having some impact. In a USA Today/Gallup poll released this week, 55 percent of those polled said environmental protection should be prioritized, even if it meant limiting U.S. energy production.

In the same poll, however, 50 percent said they still supported increased offshore drilling, perhaps realizing that the nation depends so heavily on oil that change will be difficult. The lion's share of the oil used domestically goes to power cars, trucks and airplanes, and alternatives such as hybrid-powered engines remain too expensive and inefficient for most Americans.

"We've been through this sort of drill before with the oil embargo back in the 1970s, the various oil price shocks," said Frank Felder, the director of the Center for Energy, Economic and Environmental Policy at Rutgers University in New Jersey. "Everyone gets riled up ... and then we go back to our ways. The reason we do it is that oil is just very, very useful."

With the economy recovering gingerly and elections looming in November, politicians aren't radically changing their rhetoric, either.

President Barack Obama has said that while the Gulf spill should be "a wake-up call" for the need to invest in renewable energy, he continues to support expanded domestic drilling as part of a national security effort to make the country less dependent on foreign oil.

Sen. John Kerry, D-Mass., the leading author of the major energy bill the Senate is considering this year, said this week that, "The sooner we can move off fossil fuels and to a new energy paradigm, the better for our nation." At the same time, he said, "We're not going to stop drilling in the Gulf. Let's be realistic."

"About 30 percent of our transportation fuel comes from the Gulf," Kerry said. "You think Americans are suddenly going to stop driving to work tomorrow? You think people are going to stop driving trucks to deliver the goods to the department store? It's not going to happen."

Some say the challenges are overstated and that Americans can end their oil dependence with a few small lifestyle changes: promoting electric vehicles, investing in light rail, creating pedestrian- and bike-friendly communities and exploiting alternatives such as natural gas.

"Meeting this challenge will not be easy, but nor will it require tremendous sacrifices," the American Security Project, a nonpartisan research center, and the Sierra Club, a leading environmental group, wrote in a report this week. "There is a powerful economic rationale for taking action now."

Sean Kay, a professor and the chairman of the international studies program at Ohio Wesleyan University, said that even if the spill made Americans rethink how they used oil, it would take "a sustained campaign" by politicians, lasting years and with far more intensity than on display now, to shift behavior and spending.

Kay said that expanding alternative energy was essential, not just for national security but also for preserving U.S. dominance, but that Americans still considered the short-term costs more important than the long-term benefits.

"A press conference on a Thursday afternoon probably isn't going to do the trick," Kay said. "The actual movement and action on these things would cause near-term economic dislocation."

"It begs the question: At what cost to American competitiveness?" said John Hofmeister, a former president of Shell Oil who's founded an advocacy group, Citizens for Affordable Energy, and written a book called "Why We Hate the Oil Companies."

"I understand the environmentalists' issue with hydrocarbons. I don't like hydrocarbons any more than they do, but the reality is we're living off hydrocarbons," Hofmeister said. "It would take us at least 50 years to get to where the environmentalists want to get, but they want to get there a lot faster."

He said America was well on its way to developing alternative energy sources and didn't need the BP spill to get people interested. The question, he thinks, is how quickly it's practical to shift without hurting the economy and outpacing science.

In the interim, Hofmeister supports more domestic oil and gas exploration in shallow offshore areas or on federal land.

One pet cause he hopes will get more attention is moving away from the internal combustion engine.

"Let's use batteries, let's use hydrogen fuel technology for mobility," he said. He notes moves by Germany and Japan in this direction. Even so, he said, "It would take 25 years to cycle away from the internal combustion engine if we start now."

The pace of change that environmentalists and scientists want seems, for now, to be distant and extremely expensive.

According to PFC Energy, a consulting firm to energy companies, shifting 10 percent of U.S. electricity sources to wind power would require wind farms covering an area the size of South Dakota. Shifting 10 percent of the total U.S. energy supply to solar would require an investment of $16 trillion.

"I'm not trying to trivialize things," said J. Robinson West, the firm's founder. "It's just the scale and cost are staggering."

The "low-hanging fruit," as West put it, is legislation requiring automobiles to become more fuel-efficient, which the Obama administration has slowly been trying to advance.

"I haven't seen a vast movement in the last 20 years for everybody saying, 'I want to buy this small car because I'm worried about national security,' " said James Sweeney, a management science and engineering professor who heads Stanford University's Precourt Energy Efficiency Center. "They may be willing to say, 'I'd like more fuel efficiency standards.' "

The 1989 Exxon Valdez spill didn't stop Americans from driving, Sweeney pointed out, but it did force oil companies to adopt double-hulled tankers. In the same way, many experts said, the Gulf spill probably will lead to tougher government regulations on offshore drilling. That could cause production delays and raise costs to consumers, but even some limited-government advocates seem to agree now that that's a worthy tradeoff.

"If the result of this is to determine a set of practices to make drilling much safer," said Halff, the commodities researcher, "that would be a positive outcome."

(Renee Schoof contributed to this article.)

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