Moving toward a better energy policy
There’s a great line often ascribed to Yogi Berra: “If you don’t know where you are going, you might wind up someplace else.” This perfectly describes U.S. energy policy — and offers a way forward that would not only create lots of social benefits, but just might make energy policy something that matters to U.S. electoral politics.
To see why, try ranking those events in political history when politicians really got it right. Declaration of Independence? Emancipation Proclamation? Man on the moon? Pick whichever ones you’d like. Here’s my prediction: those great moments were all framed around goals we sought to achieve, without prejudice to the path we took to get there.
Why does this matter to energy policy? Because we’ve never had an energy policy that got beyond a narrow focus on the path.
This is a big deal, for two reasons. One, we are massively inefficient in the way we allocate resources when it comes to energy. All that time spent picking winners is time not spent chasing a goal.
Two, we haven’t framed energy policy in a way the populace understands — and therefore, have never had an election decided on the basis of energy policy. Good politicians know this, which explains why our best politicians generally don’t understand energy policy — after all, it’s hard to get elected, and time spent learning how our energy system works is time not spent getting elected.
(To anyone who argues that energy policy is simply too big and too complicated to become a significant electoral issue, I have two words: Iraq War. Shia, Sunni, oil, terror. Really complicated, lots of moving pieces, yet I’ve never met anyone who doesn’t consider it an electoral issue. Or for that matter, have an opinion as to a better way forward.)
Once you start thinking through the goals vs. paths dichotomy, a lot of things start to make sense. Think again about those big political successes. “We will send a man to the moon by the end of the decade.” “Go west, young man.” “I have a dream.” “With malice toward none and charity toward all.”
Inspiring words. Now ask yourself how inspired you’d be if these had instead been framed in terms of next steps. Imagine Lincoln’s second inaugural not as a goal, but rather as a detailed plan for Southern reconstruction. Or recast Kennedy’s plans for lunar exploration in terms of the net benefits from public/private partnerships that would result from federal R&D in Titan rockets. Who would have listened, or cared? More importantly, who would have acted?
Yet that is exactly how we frame our energy policy. Not in terms of goals, but in terms of paths. Clean coal. Nuclear. Solar. Cogen. Yawn. Who cares? Who is motivated to act? Yes, a few wonks really dig this sh*t, but it’s not much of a battle cry. So our energy policy becomes various flavors of pork with no internal coherence. We throw money at coal in the name of national security and money at Iraq in the name of terror. (Or as Jim Woolsey puts it, we fund both sides of the war on terror.) And Yogi Berra keeps smiling.
It’s difficult to overstate how much we could accomplish as a nation if we had a leader who clearly articulated a goal-based strategy. Heck, look at how much Churchill got done by promising nothing more than blood, sweat, and tears. Certainly more than every U.S. president who promised energy independence en route to his meeting with the Saudi ambassador.
Therein lies the key. Our leaders need not only to articulate those goals, but to behave in a manner consistent with them. This cuts both ways. Yes, we shouldn’t cheer politicians who claim to care about global warming but won’t bind the country to reductions in same. But we also shouldn’t cheer politicians who say that global warming must be addressed but won’t allow nuclear plants to earn money from carbon savings.
So what should those goals be? Here’s my list:
- Reduce our CO2 emissions per dollar of capital investment. We have to get CO2 reduced now … not when our favorite technology becomes commercially viable. Get the low-hanging fruit now and stop preferentially pushing money.
- Minimize our delivered cost of energy. Energy costs include more than just getting stuff out of a well; they also include getting it shipped, converted, distributed, and used. We must stop subsidizing one part of that system at the expense of smart investments elsewhere. Don’t force new fuel technologies to compete with petroleum without first forcing consumers to pay the full price of petroleum. Don’t force local power technologies to compete against wholesale power prices as if the transmission and distribution system were free.
- Minimize fossil fuel use per unit of useful energy. Virtually every problem faced by our energy system is alleviated by using less fossil fuel, from national security to global warming. Drive that ratio down and all other problems get easier.
- Be pro-market, not pro-business. Markets work, but there is no natural constituency for economic efficiency. Politicians and the media too often confuse the pursuit of profits in a competitive market (which is a good thing) with the existence of profits in a specific business (which is just a thing). There is no inherent benefit brought about by a specific business or industry making money — but there is a lot of good brought about by making sure that businesses chase efficiency and fight for every dollar they earn. The energy industry is far too insulated from this discipline, to our great detriment.
I leave it to others to figure out how to frame those goals in a way that can inspire the masses. I can guarantee that the politician (or political body) that framed the issue simply in terms of those four goals — crafted policies accordingly, without picking winners, and then got out of the way — would have a transformative effect on our environment and economy, and would be remembered by history as the Lincolns, Kings, and Jeffersons of their day.
Any takers? Please?