Obama's Oil Reality Check
Editor's Note: After less than a week in office, President Obama demonstrated he would waste little time rewriting the rules for auto standards. On January 26, Obama directed officials at the Environmental Protection Agency to quickly ratify an application by California and 13 other states seeking to set limits on greenhouse gases from cars and trucks that are stricter than federal guidelines. Carmakers have vigorously opposed California’s move but at least four federal courts have ruled in favor of the states. Obama also ordered Department of Transportation officials to write rules implementing a 2007 law mandating a 40 percent improvement in gas mileage for autos and light trucks by 2020.
For Barack Obama, sensibly and scientifically curing the nation’s energy crisis at breakneck speed will be better than a bucket of bailouts and several military invasions combined.
The new president could fight Iran and terrorism by reducing the estimated $1 trillion the U.S. economy spends each year on foreign oil from OPEC regimes. Jobs upon jobs would be created if his administration creates a new fuel infrastructure, alternative propulsion supply line, and upgraded public transit. What’s more, by subtracting America’s dependence on Mideast oil, Obama can influence whole spheres of foreign policy. Imagine a Middle East devoid of the petropolitical pressure point.
The question is how to tackle the fix. If Obama is true to form, he will continue to surprise his detractors with centrism and sense. But his task is enormous.
At the outset, Obama must sever his allegiance to politicized fuels that make no sense. Gal Luft, energy guru and co-founder of the anti-foreign oil Set America Free Coalition, is among those who say the nation will never achieve fuel independence as long as the Iowa Caucuses remain pivotal to presidential campaigns. As a result of Iowa’s keystone political status, corn ethanol has secured an $8 billion annual taxpayer subsidy going directly to oil companies and agricomglomerates, such as A.D.M. and Cargill. This is for an oil-dependent fuel mix that requires 1.25 gallons of petroleum products to produce and deliver a single gallon of ethanol. At the same time, critics note, more productive Brazilian sugarcane ethanol—which is 100 percent petroleum-free—is kept out of America with high tariffs. Similarly, “clean coal” is a decades-long boondoggle supported by Obama to secure coal-belt votes.
Once fuel distractions are gone, the Obama administration can focus on an uncomfortable truth: It must retrofit, that is, convert vehicles en masse to any of a myriad of fuel or propulsion alternatives, such as methanol, electric, or compressed natural gas. The word “retrofit” is one Obama never used during the presidential race. His original campaign pledge to place 1 million plug-in hybrids on the road by 2015 is, in fact, meaningless rhetoric, Department of Energy statistics suggest. There are currently 250 million gas-consuming cars and trucks on the road. By 2015, experts expect more than 300 million in America. One million plug-in hybrids, electric, compressed natural gas, or any other type of alternative propulsion vehicle will not even be noticed.
Immediate retrofitting, also known as “upfitting,” will be required to get off of oil. It can be done, but only with a national crash program. Look at what’s going on in Iran, of all places. Because of sanctions against it, Iran hasn’t been able to build oil refineries and as such, has become the world’s second largest importer of gasoline. So now, Iran is converting its national fleet to use compressed natural gas at the rate of 20 percent per year to counteract tightening sanctions over its nuclear ambitions. Its same-day, government-subsidized, $50-per-vehicle conversion campaign will soon make Iran gasoline-free. Many in the alt-fuel community insist America can do too this if Obama will take action.
However, in order to retrofit, Obama will have to suspend obstructive E.P.A. guidelines that effectively prohibit converting gasoline cars to abundant, cheaper compressed natural gas or other alternative fuels. E.P.A. testing procedures costing at least $50,000 per engine type have ensured that beyond a handful of workshops, there is virtually no retrofitting industry now functioning in America. That business will need to be invented. Short of immediate—and unlikely—Congressional action to suspend alt-fuel regulations, presidential powers are needed. That could set up a Constitutional test reminiscent of F.D.R.’s New Deal.





