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Does the U.S. even need more tar sands oil from Canada?

November 3rd, 2011

By Barbara Kessler
Green Right Now

One key argument being used by proponents of the Keystone XL pipeline is that it will make the US more secure by providing oil from Canada, a friendlier source than the more volatile Middle East.

Many critics of the pipeline reject this argument, predicting that the oil will end up on the global market after traveling the proposed 1,700 mile pipeline from Alberta to Texas, where the bitumen oil will be refined.

Tar sands mining turns forests into lifeless landscapes.

But for argument’s sake, let’s say the U.S. would be a buyer of  Canadian tar sands oil. Right now, the U.S. gets about 25 percent of its imported oil from Canada already, its single largest supplier of imported oil, according to the U.S. Energy Information Administration (EIA). The rest comes from Mexico, Saudi Arabia, Nigeria, Venezuela, Iraq, Colombia, Angola and a handful of other nations whose politics we don’t share.

One could reasonably argue that our nation would be more secure if we obtained more oil from allies, and less from repressive regimes.

But that begs the question. Do we need the environmentally costly Canadian tar sands oil, which is scraped from the earth, destroying forests and creating giant lakes of toxic tailings?

If you listen to the proponents for the Keystone pipeline, it’s a given that the U.S. will need this oil, which requires copious amounts of water and two tons of tar sands to produce just one barrel of oil while producing two to three times more carbon emissions than conventional oil. And if you listen to oil industry leaders like Rex Tillerson, CEO of Exxon Mobil, world oil demand, generally, will continue to rise by as much as one-third until 2050 despite all the clean tech, efficiency and renewable innovation coming into energy markets.

So will the U.S. need more and more oil? Or will demand stabilize and even decline? This is the multi-billion dollar question.

Oil demand has ticked down in the U.S. in 2011 to about 19 million barrels a day, though it’s expected to rise again in 2012. But there are mixed signals ahead.

Earth Policy Institute president Lester Brown writes in a notably optimistic column this week  that U.S. carbon emissions are down by 7 percent, partly due to coal plant closures, but also because of more efficient of cars.

Brown writes:

In fact, oil use has fallen fast in the United States over the last four years, thus reversing another long-term trend of rising consumption. The reasons for this include a shrinkage in the size of the national fleet, the rising fuel efficiency of new cars, and a reduction in the miles driven per vehicle.

Fleet size peaked at 250 million cars in 2008 just as the number of cars being scrapped eclipsed sales of new cars. Aside from economic conditions, car sales are down because many young people today are much less automobile-oriented than their parents.

In addition, the fuel efficiency of new cars, already rising, will soon increase sharply. The most recent efficiency standards mandate that new cars sold in 2025 use only half as much fuel as those sold in 2010. Thus with each passing year, the U.S. car fleet becomes more fuel-efficient, using less gasoline.

Not only is the U.S. car fleet becoming more conservative with gasoline, it’s also electrifying. The Obama Administration has set a goal of putting 1 million electric cars on the road by 2015 – that’s a tiny fraction of total cars – but enough to seed a network charged on a grid that’s increasingly wind and solar-powered, meaning there’s no oil in the equation, and almost no carbon emissions.

Renewable energy will help power electric cars, reducing U.S. oil consumption.

The electric car market could take off quickly by mid-decade, if the cost of electric car batteries continues to fall per projections. Right now the cost of a typical electric-vehicle battery is around $20,000, according to the Department of Energy. With that high price tag, it’s easy to see why the plug-in electrics in production all weigh-in at more than $30,000, out of reach of most Americans.

But DOE predicts that the price of the lithium ion batteries powering these cars will fall precipitously, to around $5,000 by 2020. That would put electric cars within reach of the masses within the next 10 years.

Now take that significant drop in electric car prices, and add in the lower cost of PV solar panels (which have dropped about 30 percent over the last two years), the advance of the smart grid, and the efficiency gains in wind power that are extending the geographic reach of that power source, and you’ve got a perfect storm of change on the horizon.

Electric car batteries are projected to become vastly more affordable. (DOE)

Sure, by 2020, most of us will still be driving gasoline cars. I hope my Fiesta, which gets a sturdy 38 mpg, lasts that long. But if we make the right choices, the U.S. may loosening its fossil fuel shackles by then.

If biofuel technology continues to improve, creating greener jet travel, and high-speed rail is rescued from the claws of the deficit hawks, we’ll be tacking even more strongly toward freedom from our oil addiction.

Energy analysts will debate what needs to happen specifically to achieve the right balance of new energy and affordability, but even my college economics tells me this transformative time will be fraught with potential pitfalls or opportunity costs. If we fail to move forward aggressively toward clean, renewable energy and let vested interests keep us locked into oil, we risk suffocating the new energy jobs that could buoy the next generations, stabilize our economy, keep energy costs down and power future innovation. We risk, in short, our national security.

Today, DOE Secretary Steven Chu made just this point during an address to the Smart Energy Conference in Washington D.C..

“America faces a choice today: Are we going to recognize the opportunity and compete in the clean energy race or will we wave the white flag and watch all of these jobs go to China, Korea, Germany and other countries?”

“…To those in Washington who say we cannot or should not compete, I say: that’s not who we are.  In America, when we fall behind, we don’t give up. We dig in and come back. Why should we concede one of the biggest growing markets in the world that is in our sweet spot: technological and manufacturing innovation? America has the opportunity to lead the world in clean energy technologies and provide the foundation for our prosperity.”

Chu didn’t knock oil during his speech. He doesn’t have to, and that’s not the debate, anyway. Everyone understands that oil fuels our transportation and also that this fossil fuel is, by definition, destined to decline.

The really salient question centers on whether we will wrestle ourselves away, gracefully and effectively, from what’s getting to be a dirtier and dirtier business.

Or will we tarry at the trough, scraping the bottom of the barrel for the sticky remains?

  • Keystone pipeline background on GreenRightNow here.

Copyright © 2011 Green Right Now | Distributed by GRN Network



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