Friday, June 27, 2008

Solving the Energy Crunch

News sources are swirling about the latest oil prices and people are demanding action from government. They want answers. Unfortunately they are getting answers, but it is the answers they really don’t want to hear. Bottom line: The days of cheap energy from fossil fuel sources are gone and will never return. My recent perusing of information sources has provided several examples of proposed solutions that, with one exception, are ludicrous at best.

Some folks are proposing we extend our exploration of fossil fuels. They take the word of others proclaiming plenty of fuel lies beneath the earth’s crust waiting for us to harvest and process. Whether the fuel lies there or not isn’t the core problem. Processing what we find is not probable within the near future and would require more capital that can be used to find an alternate, more viable solution. Installing the equipment to draw this oil may take at least a decade and the oil companies currently do not have the refinery infrastructure to handle the onslaught. It would take at least a decade to upgrade our long ignored refining capacity.

Another problem with drawing further upon domestic reserves occurs merely because we opened the floodgates and allowed ourselves to transition to a world economy. The demand for energy is booming because parts of the world previously stagnant are booming. China is consuming almost 33% of the world’s fuel oil capacity and their demand is increasing. Our oil would barely affect world oil prices and would be thrown into the world economic pool at the current pricing.

A group of people think we should blame the oil companies and limit their profits. In case you haven’t noticed most of the oil companies are actually transitioning into energy companies. They need the capital funding to explore alternate fuel sources including wind and solar farms. Even if we accepted the solution to draw upon existing fossil fuel they would need the extra capital to expand refining capacity.

Political contingents have declared a gas tax holiday as a stop gap measure to our current economic crisis. Such foolishness can only be assigned to the low level thinking of political popularity games. Just recently a bridge collapsed in Minneapolis and the nation was reminded of our dilapidated infrastructure. People demanded answers. Folks, we pay for that infrastructure through those gas taxes. Obviously the term “holiday” means there is a limit to the break. Then we return to the problem at hand.

When man finally conquered the limits of the upper stratosphere and entered the vast regions of space we all got a glimpse of our own spaceship, Earth. Just as we will eventually be reminded of our own mortality we were reminded then of our host’s limited size. Yes, we will run out of fossil fuels. Isn’t it time we found that alternate source.

Contrary to the wishes of my Republican friends Barack Obama probably has the best idea. We should invest quickly in alternative energy sources while letting the escalating prices naturally curtail our usage of the existing source. It is simple free market ideas at work. My only concern is Senator Obama’s chances of implementing a successful plan. It is quite evident that his potential presidency would face political obstacles in a crisis that should be approached without politics.

If Senator McCain is successful in his bid for office we can only hope he has the wisdom to see the crisis and the gall to make the right decision. I have oft admired Senator McCain and believe, at one time, he could have implemented a successful solution. Today it seems he has forfeited his own beliefs in an effort to satisfy those who would otherwise oppose him within the Republican Party.

If you close your eyes and wish real hard you may be able to ignore the melting of the polar ice caps and balloon our planet with a perpetual source of fossil fuel. I am sincerely concerned that my grandchildren will not be so fortunate.

© 2008 Mark A. Daily