energy policy of the United States

 

The Energy policy of the United States is determined by federal, state and local public entities in the United States, which address issues of energy production, distribution and consumption. Energy policy may include legislation, international treaties, incentives to investment, guidelines for energy conservation, taxation and other public policy techniques. Several mandates have been proposed over the years, such as gasoline will never exceed $1.00/gallon (Nixon), and the United States will never again import as much oil as it did in 1977 (Carter),^[1] but since the country is largely a free market society no comprehensive long term energy policy has been proposed. Two Energy Policy Acts have been passed, in 1992 and in 2005, which include many provisions for conservation, such as the Energy Star program, and energy development, with tax incentives for both renewable and non-renewable energy.

History

In the Colonial era the energy policy of the United States was for free use of standing timber for heating and industry. In the nineteenth century, it was access to coal and its use for transport, heating and industry. Whales were rendered into lamp oil.^[2]

Coal provided the bulk of the US energy needs well into the twentieth century. By 1950, oil consumption exceeded that of coal.^[3][4] The abundance of Californian, Texas and Mexican oil, coupled with its low cost, ease of transportation, and use in internal combustion engines, lead to its increasing use. Following World War II, oil heating boilers took over from coal burners in the Eastern Seaboard; diesel locomotives took over from steam engines under dieselisation; oil fired electricity plants were built; oil burning buses replaced electric streetcars, and citizens bought gasoline powered cars. Interstate Highways helped make cars the major personal means of transportation.^[5] As oil imports increased, US foreign policy was inexorably drawn into Middle East politics, supporting oil-producing Saudi Arabia and patrolling the sea lanes of the Persian Gulf.^[6]

Also, hydroelectricity was being generated from major dams like the Jensen Dam, TVA Project and the Grand Coulee Dam. Rural electrification strung power lines to many more areas.^[7][8]

Energy Independence

Main articles: Oil crisis and U.S. Energy Independence

The 1973 oil crisis made energy a hot topic in US society, due to rapidly increasing oil prices, lack of house heating resources etc...^[9] The Federal Department of Energy was started with steps planned toward energy conservation and more modern energy producers. A National Maximum Speed Limit of 55 mph (88 km/h) was imposed to help reduce consumption, and Corporate Average Fuel Economy standards were enacted to downsize automobile categories.^[10] Year-round Daylight Saving Time was imposed, the United States Strategic Petroleum Reserve was created and the National Energy Act of 1978 was introduced. Alternate forms of energy and diversified oil supply resulted.^[11]

The United States receives 84% of its energy from fossil fuels.^[12] This energy is used both for transport, industry, and domestic use. The remaining portion comes primarily from Hydro and Nuclear stations.^[13] Americans constitute less than 5% of the world's population, but consume 26% of the world's energy,^[14] although having only 3% of the world’s known oil reserves.^[15]

The proposal has been made for a hydrogen economy, where cars and factories are powered by fuel cells, although the hydrogen would still have to be produced at an energy cost, and hydrogen cars have been called one of the least efficient, most expensive ways to reduce greenhouse gases.^[16][17] Other plans include making society carbon neutral and using renewable energy, including solar, wind and methane sources. Vatican City became the first carbon neutral country in 2007.^[18]

Automobiles, on the other hand, possibly could be powered 30% by grid electricity, 30% by biofuels, 30 % hydrogen and 10% direct solar. Re-design of cities, telecommuting, transit, higher housing density and walking could also reduce automobile fuel consumption and obesity.^[19] Carpooling, flexcars, Smart cars, and shorter commutes could all reduce fuel use.^{[original research?]}

It should be noted that between 1950 and 1984, as the Green Revolution transformed agriculture around the globe, world grain production increased by 250%. The energy for the Green Revolution was provided by fossil fuels in the form of fertilizers (natural gas), pesticides (oil), and hydrocarbon fueled irrigation.^[20] The peaking of world hydrocarbon production (Peak oil) may test Malthus' critics.^[21]

United States' relationships with oil-producing countries

Henry Ford had the vision to see the long-term benefit of developing relationships with oil-rich countries. ^{[citation needed]} His pro-Arab stance was therefore a logical outcome of the economics of petroleum, and it was he who spearheaded the establishment of the largest Arab community in the United States in Dearborn, Michigan and the Detroit environs, by providing many in that community with jobs in his factories. Indeed, the Detroit area hosts the largest population of Arab Americans in the U.S. Ford's good friend, Charles Lindbergh, the famous aviator saw the then fledgling airline industry as heavily dependent upon Arab oil, and shared similar political views.

Similarly, the close relationship the United States has with Saudi Arabia, the world's single largest oil producer, may best be understood as a symbiotic relationship: America's energy needs in lieu of Saudi Arabia's needs for capital. The Saudi's wish to modernize and beautify their country into a western-style paradise, as well as create long-term investments throughout the world for use once their oil reserves become depleted. Successive American presidents have provided "red carpet" treatment to the Saudis. The American posture toward Saudi Arabia and many other OPEC counties, has been touted as a "special relationship" in the media. This relationship was shaken by the rise of Islamic militancy, and most acutely by the events of September 11, 2001. For the first time in close to a century, the leadership of the United States as well as many of the American people, began to weigh the benefits versus costs of those relationships, and reliance upon an energy source that was costly, easily interruptible, polluting, and which would eventually run out.

To date, the Saudis alone have invested approximately 70 billion dollars around the globe, 60% of which was invested in the United States. Saudi Arabian investments in the United States have traditionally been a welcome counterweight to the systemic U.S. trade deficit with the Kingdom. As American demand for Saudi oil continues at 1.5 million barrels per day, U.S. service and merchandise exports revenues to the Kingdom cover nowhere near the level of expenditures for petroleum. One enabler of U.S. consumption has been the historic Saudi Arabian willingness to finance this trade deficit by investing in the United States. This relationship, while symbiotic, and necessary to a U.S. economy addicted to consumption, is viewed by many as "golden hand-cuffs" voluntarily worn by the United States.

The current account is the broadest measure of a nation’s balance of income payments with the rest of the world, and it is the difference between a nation’s receipts (exports and returns on domestic holdings of foreign investment) and its payments (imports and returns on foreign holdings of domestic investment). Just like a household that spends more than it earns, a nation must finance its current account deficit through borrowing. The balance of payments is one reflection of a nation's financial economic stability. The current U.S. account balance is a 'negative value.' As of 2004, the account balance in the U.S. was minus (-) 665.5 billion dollars. This borrowing on the part of the United States has, predictably, led to an enormous foreign debt. In contrast, Saudi affluence is soaring, with a record 70 billion dollar budget surplus for 2006.^[22]

Sources

The majority of the energy in the United States is derived from fossil fuels: in 2005, it was estimated that 40% of the nation's energy came from petroleum, 23% from coal, and 23% from natural gas. The remaining 14% was supplied by nuclear power, hydroelectric dams, and miscellaneous renewable sources.^[23]

Petroleum

The US consumes 20.8 million barrels of petroleum a day.^[24], of this 9 million barrels of gas. Automobiles are the single largest consumer of oil^[25], consuming 40%, and are also the source of 20% of the nation's greenhouse gas emissions.^[26]

The USA has about 22 billion barrels reserves while consuming about 7.6 billion barrels per year.^[24] This has created pressure for previously reserved locations in places such as ANWR to be opened up for drilling.

Problems associated with oil supply include volatile oil prices, increasing world and domestic demand, and falling domestic production.

American dependence on imports grew from 10% in 1970 to 65% by the end of 2004. At the current rate of unchecked import growth, the US will be 70% to 75% reliant on foreign oil by the middle of the next decade. The country is now more dependent on oil, and less secure in its supply, than at any previous time.^[27]

Coal

America is self sufficient in coal^[28]. Indeed, it has several hundred years supply of it^[29][30]. America could get a large portion of its oil from coal if so desired. (see Fischer-Tropsch process)^[31] The United states trend in coal use has been rising for decades. From 1950 through 2006, both coal production and coal consumption in the United States have more than doubled.^[32]

(One reason for this change is the closure of US steel plants in the 1970s due to foreign competition,^{[citation needed]} and the conversion of the remaining steel plants to the electric reduction process, which has the electric plant burn the coal instead of the steel plant.) The population of the US has almost doubled in this time period as well, if not per capita electric use.^{[citation needed]}

Most electricity in the country is generated from coal-fired power plants:^[8] in 2006, more than 90% of coal consumed was used to generate electricity. In 1950, about 19% percent of the coal consumed was for electicity generation.^[33]

In terms of the production of energy from domestic sources, from 1885 through 1951, coal was the leading source of energy in the United States. Crude oil and natural gas then vied for that role until 1982. Coal regained the position of the top domestic resource that year and again in 1984, and has retained it since.^[34] The US burns 1 billion tons of coal every year.

Nuclear Power

Main article: Nuclear power in the United States

See also: Nuclear Power 2010 Program

In 2004 in the United States, there were 104 (69 pressurized water reactors and 35 boiling water reactors) commercial nuclear generating units licensed to operate, producing a total of 97,400 megawatts (electric), which is approximately 20% of the nation's total electric energy consumption. The United States is the world's largest supplier of commercial nuclear power, however until 2005 no new nuclear power plants had been ordered for over twenty years. One nuclear power station can supply around 800 megawatts of power.

Although expensive to build, nuclear power plants can yield large quantities of electricity with relatively low operating costs, and with the emission of low levels of greenhouse gases. With political intervention, a percentage of the nation's electricity production could be generated by nuclear power, as in France, where nuclear power provides about 78% of the electricity.^[35]

Renewable energy

Main article: Renewable energy commercialization in the United States

Generating three times as much energy as any other renewable source, and 150 times that of wind power, the United States' hydroelectric plants produce 300,000 MW, making the largest contribution to the country's renewable energy^[36] However, wind power in the United States is a growing industry. Latest figures show that installed U.S. wind power capacity now exceeds 11,600 MW which is enough to serve three million average households.^[37] Texas is firmly established as the leader in wind power development in the U.S., followed by California.^[38] The Horse Hollow Wind Energy Center in Texas is the world's largest wind farm at 735.5 MW capacity.^[39]

Several solar thermal power stations, including the new 64 MW Nevada Solar One, have also been built. Solar Energy Generating Systems (SEGS) is the name given to nine solar power plants in the Mojave Desert, which were commissioned between 1984 and 1991.^[40] The SEGS installation uses parabolic trough solar thermal technology along with natural gas to generate electricity. The plants have a total generating capacity of 354 MW, making the system the largest solar plant of any kind in the world.^[40]

Geothermal energy use is undergoing expansion and the USA is a world leader in the generation of electricity from geothermal energy. According to a recent report, there were 75 new geothermal power projects underway in 12 states as of May 2007.^[41] [German team wins solar home competition. AP Fri Oct 19, 8:45 PM ET]

Biofuels

Main article: Biofuel in the United States

In recent years there has been an increased interest in biofuels - bioethanol and biodiesel - derived from common agricultural staples or waste. Increased domestic production of these fuels would reduce US expenditure on foreign oil and improve energy security.

Most cars on the road today in the U.S. can run on blends of up to 10% ethanol, and motor vehicle manufacturers already produce vehicles designed to run on much higher ethanol blends. Portland, Oregon, recently became the first city in the United States to require all gasoline sold within city limits to contain at least 10% ethanol.^[42] Ford, DaimlerChrysler, and GM are among the automobile companies that sell “flexible-fuel” cars, trucks, and minivans that can use gasoline and ethanol blends ranging from pure gasoline up to 85% ethanol (E85). By mid-2006, there were approximately six million E85-compatible vehicles on U.S. roads.^[43]

The Renewable Fuels Association counts 113 U.S. ethanol distilleries in operation and another 78 under construction, with capacity to produce 11.8 billion gallons within the next few years. The Energy Information Administration (EIA) predicts in its Annual Energy Outlook 2007 that ethanol consumption will reach 11.2 billion gallons by 2012, outstripping the 7.5 billion gallons required in the Renewable Fuel Standard that was enacted as part of the Energy Policy Act of 2005.^[44]

Expanding ethanol (and biodiesel) industries provide jobs in plant construction, operations, and maintenance, mostly in rural communities. According to the Renewable Fuels Association, the ethanol industry created almost 154,000 U.S. jobs in 2005 alone, boosting household income by $5.7 billion. It also contributed about $3.5 billion in tax revenues at the local, state, and federal levels.^[45]

Carbon emissions

See also: Greenhouse gas emissions by the United States and Kyoto Protocol

Although possibly exceeded by China,^[46] the United States has historically been the world's largest producer of greenhouse gases.^[47] Some states, however, are much more prolific polluters than others. The state of Texas produces approximately 1.5 trillion pounds of carbon dioxide yearly, more than every nation in the world except six: the United States, China, Russia, Japan, India and Germany.^[48]

Despite signing the Kyoto Protocol, the United States has neither ratified nor withdrawn from it. In the absence of ratification it remains non-binding on the US. President Bush has indicated that he does not intend to submit the treaty to the Senate for ratification, not because he does not support the Kyoto principles, but because of the exemption granted to China (the world's second largest emitter of carbon dioxide^[49]). Bush also opposes the treaty because of the strain he believes the treaty would put on the economy; he emphasizes the uncertainties which are present in the climate change issue.^[50] Furthermore, the U.S. is concerned with broader exemptions of the treaty. For example, the U.S. does not support the split between Annex I countries and others.

The Bush Administration has taken no specific actions towards mitigation of climate change. At state and local levels, however, there are currently a number of initiatives. As of January 18, 2007, eight Northeastern US states are involved in the Regional Greenhouse Gas Initiative (RGGI),^[51] a state level emissions capping and trading program.

On August 31, 2006, the California Legislature reached an agreement with Governor Arnold Schwarzenegger to reduce the state's greenhouse-gas emissions, which rank at 12th-largest carbon emitter in the world^[52], by 25 percent by the year 2020. This resulted in the Global Warming Solutions Act which effectively puts California in line with the Kyoto limitations, but at a date later than the 2008-2012 Kyoto commitment period.

As of March 11, 2007, 418 US cities in 50 states, representing more than 60 million Americans support Kyoto after Mayor Greg Nickels of Seattle started a nationwide effort to get cities to agree to the protocol.^[53]

In the non-binding '[[G8+5|Washington Declaration]]' agreed on February 16, 2007, the United States, together with Presidents or Prime Ministers from Canada, France, Germany, Italy, Japan, Russia, United Kingdom, Brazil, China, India, Mexico and South Africa agreed in principle on the outline of a successor to the Kyoto Protocol. They envisage a global cap-and-trade system that would apply to both industrialized nations and developing countries, and hoped that this would be in place by 2009.^[54][55]

Chemistry Professor Nathan Lewis at Caltech estimates that to keep atmospheric carbon levels below 750 ppm, a level at which seriously climate change would occur, by the year 2050, the United States would need to generate twice as much energy from renewable sources as is generated by all power sources combined today.^[56]

Distribution and consumption

Electricity

Main article: Electricity distribution

Statistics

Electricity:

• production 3.979 trillion kWh produced in 2004 [1]

Electricity - production by source:

• fossil fuel: 71.4%
• hydro: 5.6%
• nuclear: 20.7%
• other: 2.3% (2001)

Oil:

• production: 7.61 million barrel/day (2005 est.)
• consumption: 20.03 million barrel/day (2003 est.)

(Remember: Heat Engines are only 20% efficient at converting raw energy (oil) into work.^{[citation needed]} Electric transmission (production to consumer) loses over 23% of the energy due to generation, transmission, and distribution^[57])

Carbon emissions:

US carbon dioxide emissions (thousands of metric tons of CO2)[58]
Year	CO2	Change from 1990
1990	4,825,360	0.00%
1991	4,835,750	0.22%
1992	4,811,240	-0.29%
1993	5,093,340	5.55%
1994	5,191,960	7.60%
1995	5,191,790	7.59%
1996	5,296,900	9.77%
1997	5,563,500	15.30%
1998	5,513,530	14.26%
1999	5,608,310	16.23%
2000	5,803,410	20.27%
2001	5,757,010	19.31%
2002	5,805,750	20.32%
2003	5,799,240	20.18%

Public opinion

The US results from the 1st Annual World Environment Review, published on June 5, 2007 revealed that:^[59]

• 74% are concerned about climate change.
• 80% think their Government should do more to tackle global warming.
• 84% think that the US is too dependent on fossil fuels.
• 72% think that the US is too reliant on foreign oil.
• 79% think that the US Government should do more to increase the number of hybrid cars that are sold.

An April CBS News/New York Times poll collected a wide range of data that demonstrates the public’s desire for serious action on global warming. By an almost two-to-one margin (63 percent to 32 percent), the public endorses the idea that protecting the environment is so important that “requirements and standards cannot be too high” and that “continuing environmental improvements must be made regardless of cost.”

The public is also quite clear on its priorities when it comes to promoting energy conservation versus increasing the supply of oil, coal, and natural gas. When asked which of these should be the higher priority, the public chooses energy conservation by a very wide 68 percent-to-21 percent margin.^{[citation needed]}

The public also predominantly believes that the need to cut down on energy consumption and protect the environment means increased energy efficiency should be mandated for certain products. Ninety-two percent of Americans now support such requirements. ^[60]

See also

• Category:Energy by country
• Economics of new nuclear power plants
• Electricity distribution
• Energy policy
• Energy Policy Act of 1992
• Energy Policy Act of 2005
• Greenhouse gas emissions by the United States
• Nuclear and fossil dependence
• Oil reserves
• Petroleum industry
• United States Department of Energy
• United States Secretary of Energy
• World energy resources and consumption

External links

• Energy Profile Analysis of The United States.
• U.S. Department of energy.
  • U.S. Department of energy timeline
• Energy Information Administration.
• USDA energy.
• United States Energy Association (USEA).
• U.S. energy stats
• Public Opinion Snapshot: The Public Wants Action on Energy and the Environment
• ISEA — Database of U.S. International Energy Agreements
• Retail sales of electricity and associated revenue by end-use sectors through June 2007 (Energy Information Administration)

References

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