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August 31, 2013

What makes good sense, and what doesn't

The Daily Star

---- — By Mike Zagata

Local Commentary

Following the recent visit to upstate New York by the President, a local TV station carried an interview with someone who was there to protest the exploration for and production of fossil fuels. In their place he advocated for government subsidy of renewable forms of energy like solar and wind power. That’s a position that sounds good on the surface and one that, over time, most of us would support.

There are, however, some near-term issues that would need to be addressed. First of all is the fact the government has been supporting the development of “new” energy sources since at least as far back as the 1980s. At that time the US Synthetic Fuels Corporation supported attempts to find a way to extract the oil from oil shale in a manner that would enable it to be competitive with oil produced the traditional way, i.e. drilling exploratory wells into potentially oil rich rock formations. Even with the cost of the “dry holes” included, shale oil couldn’t compete on an economic basis even though we knew exactly where it was. Then in the early 1990s the US government got involved again – this time by providing incentives to drill for coal bed methane – methane trapped in association with coal formations. That too fizzled out in short order – and you and I, as tax payers, footed the bill. Now we want to do the same with “renewable” energy sources. In fact, we already are subsidizing them, e.g. $500 million for “Solindra “ that yielded no measurable benefits and tax credits of up to $7,500 per car for electric vehicles (an existing subsidy). The honest truth is that at this point in time “renewable” can’t compete with fossil fuels when held to a standard of being cost-effective. If we heated a school district with solar power right now it would cost about 15 times as much as it would to heat it with gas. That translates to either heating with gas or oil, or heating with solar and letting teachers go.

Will the day come when that will change – I hope so. Indeed, when it does and free market forces are allowed to operate, the price of oil and gas will drop and thus will be even more competitive. Life really isn’t as simple as some make it out to be. It doesn’t have to be either/or. It can be a combination of scrubbed coal, low sulfur oil, methane, wind, solar, hydrogen and things we haven’t yet thought about.

It is important to note, however, that if we no longer drilled for and produced oil and gas our life styles would change. There are about two gallons of petroleum in every tire on our automobiles and it doesn’t matter if they are electric (thus plug into an outlet that receives power from coal-burning, oil burning or gas burning power plants at this time) or powered by diesel or gasoline. Each time we take a prescribed pill (seems to happen more as we age) we are acknowledging our dependence on natural gas – the feedstock used to manufacture many of our prescribed medicines as well as to manufacture steel. And, if that isn’t reason enough to acknowledge our dependence on fossil fuels, consider that plastic and much of the fiber used to make our clothing is petroleum based.

It’s time to have an honest dialog about our energy future and stop demanding that our position of “for” or “against” prevail and start focusing on the “how”. How can we further reduce emissions from burning fossil fuels in the near-term and how can we develop renewable energy sources that can compete with them in the market place. Our environmental and economic futures demand that we do.

MIKE ZAGATA is a former state Department of Environmental Conservation commissioner, Ruffed Grouse Society president and oil company executive.