Energy Committee

“Drill, Baby, Drill” Already Debunked - by Bush Administration

Dan Miner, Sierra Club NYC, Chair

Sarah Palin, a self-described energy expert, implies that we now rely on imported oil because we refuse to drill abundant domestic supplies; if we only did that we’d be energy independent.  Although Obama supports more drilling within a framework of efficiency and renewable power, domestic drilling is the very heart of the McCain-Palin energy plan.  Can drilling really work? Considering three factors, not widely discussed in this campaign, will help us make the right choices about our energy future.  One, the value of offshore drilling has already been debunked – by the Bush Administration.  Two, the world’s oil supply is drying up much faster than new oil can be found.  Three, as CNN reports, oil price shocks and supply disruptions are on the way, but neither McCain nor Obama has said a word about the problem, let alone how they would respond.  More domestic oil drilling can’t fix our energy crisis.  Energy independence means a rapid move beyond all oil, whether domestic or imported.  Anything less is doomed to failure.

The Bush Administration’s own Department of Energy says that while the US consumes about 25% of the world’s oil we have less than 3% of the world’s proven oil reserves.  The DOE’s Energy Information Agency reported that offshore drilling can yield up to 200,000 barrels per day – about 1% of America’s needs – in 20 years.  Drilling in the Arctic National Wildlife Refuge (ANWR) would have a similar insignificant effect.  It would take about ten years before we’d see any oil from these sources, and neither would ever have a significant effect on US oil supplies or prices.  Everyone chanting ‘drill, baby, drill’ didn’t get the memos from Bush Administration geologists.  They’re on the internet.  Any energy plan centered on domestic drilling is dead on arrival, and that’s just for starters.

Two, the problem with oil is worse than widely understood.  It’s not just that supplies are tight. World oil production is expected to peak around 2010, and begin dropping soon after that.  US oil production peaked in 1970 and has been dropping ever since, which is why two-thirds of our oil is now imported. Production from our other top sources is already declining, or at risk of political disruption.  Oil imports from Mexico, our third biggest source of oil, have already dropped more in one year than offshore drilling will get us in 20 years.

Three, CNN reports that oil price shocks and supply disruptions are on the way.  Matt Simmons, Republican CEO of a major energy investment banking firm, told CNN that the recent drop in oil prices is an illusion.  Prices will climb to $200, $300, or even higher.  Many observers agree, including the US Army Corps of Engineers, the US Government Accountability Office and independent geologists.

Straight talk about future constraints will motivate everyone, even global warming deniers, to adopt conservation and efficiency initiatives politically impossible today.  Why have neither McCain, Obama nor Mayor Bloomberg said a word about the need for contingency plans for fuel supply disruptions?

Those who act without understanding the basis of the energy crisis will only make matters worse.  Advocates for more oil drilling would keep us stuck in the past with 19^th century fuels, technologies and strategies that won’t work.  The future belongs to those who harness the clean, permanent power of wind, sun and water.  We can create clean, cheap energy here at home, while restoring domestic manufacturing and create millions of green jobs that can’t be outsourced.  America can either lead this progress, or continue being left behind as Asian and European countries continue to dominate conservation, efficiency and renewable technologies.  These are the energy facts that McCain and Obama need to know, so we can buckle our seatbelts before we hit the potholes ahead of us.  In this case, knowledge is literally power.

“International Energy Outlook 2008,” US Department of Energy, Energy Information Agency (EIA) P. 32, [21 billion barrels reserves out of world total of 1,331 billion barrels] http://www.eia.doe.gov/oiaf/ieo/pdf/0484(2008).pdf

“Analysis of Crude Oil Production in the Arctic National Wildlife Refuge,” US EIA, 2008 http://www.eia.doe.gov/oiaf/servicerpt/anwr/pdf/sroiaf(2008)03.pdf

 “Impacts of Increased Access to Oil and Natural Gas Resources in the Lower 48 Federal Outer Continental Shelf,” US EIA, 2007, www.eia.doe.gov/oiaf/aeo/otheranalysis/ongr.html

“Recent drop in crude is an illusion, oil headed to $500,” CNN, http://money.cnn.com/2008/09/15/news/economy/500dollaroil_okeefe.fortune/index.htm

“Crude Oil:  Uncertainty about Future Oil Supply Makes It Important to Develop a Strategy for Addressing the Peak and Decline of Oil Production,” GAO-07-283, US Government Accountability Office,, Feb. 2007, http://www.gao.gov/new.items/d07283.pdf


Go to www.beyondoilnyc.org for the Sierra Club NYC report “Sustainable Energy Independence for NYC,” an extended version of this essay with citations, and a five–page September 2008 update and report summary.

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Building on New York City’s PlaNYC 2030, the Sierra Club NYC report, “Sustainable Energy Independence for NYC,” prepares for sharply higher fuel prices, and their local impacts on transportation, heating, shipping and food costs.  Download at www.beyondoilnyc.org, or read an online version with links to all references.  Those wishing to join the list of endorsing organizations, or to arrange a presentation, may contact author Dan Miner, Sierra Club NYC Chair, at beyondoilnyc@yahoo.com.  Councilmember Tony Avella has requested the drafting of legislation that would create an energy price task force, as has been done in San Francisco, and Portland, OR.

Endorsing organizations to date:

Asthma Free School Zone * Brooklyn Center for the Urban Environment * Cathedral Church of St. John the Divine * Clearwater * Earth Day NY * Galapagos Art Space * Interfaith Center on Corporate Responsibility * Neighborhood Energy Network * Nos Quedamos * NYC Apollo Alliance * NY Divinity School * NY Interfaith Power & Light * NY Solar Energy Industry Association * Orange Environment * vision42  * SAVIA Associates International * Sixth Street Community Center  * Sustainable Flatbush * The Gaia Institute

PlaNYC, the City’s sustainability plan, talks about reducing our carbon emissions 30% by 2030.  However, climate change is accelerating and many scientists say we need to reduce emissions further and faster. These actions are politically possible. Opinion polls show that public support for global warming action is widespread but shallow, but when combined with concern about energy independence and higher prices, it becomes a top voter priority, even surpassing national security. 

Beside climate change, we must also respond to the parallel challenge of increasing energy price volatility.  Oil demand keeps rising, while world oil production will soon peak and go into permanent decline. That guarantees greater volatility in the price and supply of oil.  Even though its extensive public transit system makes NYC less vulnerable to oil price spikes than other cities, short-term consequences of higher prices may not be immediately obvious. (Fuel depletion is still not widely discussed, but it is no longer controversial, having been covered in the Wall Street Journal, Time magazine and CNN.) How would a prolonged increase in oil prices affect trucks bringing groceries to supermarkets?  Winter heating fuel prices?  The earnings of restaurants and theaters dependent on tourists?  Budgets for fire, police, and sanitation services?  Would commuters still choose to drive into Manhattan, or would they flock to mass transit? 

Government sustainability initiatives may have greater success when framed as responses to energy volatility than to climate change.  In the short term, expanding capacity margins through energy conservation will make the City more resilient to volatility, while expediting PlaNYC initiatives.  In the long term, we need to push discussion far past PlaNYC’s current goals, and start building a post-petroleum economy now.  The good news is that a national project to make clean energy cheap can restore domestic manufacturing, create millions of jobs that can’t be outsourced, and stimulate the economy, while improving our quality of life and mitigating climate change. NYC leadership can help make such actions a reality, and benefit our citizens.

The most effective way to accelerate NYC’s response to both climate change and energy volatility is the formation of a City Energy Volatility Task Force.

Form a NYC Energy Volatility Task Force

• form a Task Force to study potential impacts and mitigations of energy price and supply volatility – not currently considered within PlaNYC.
• require consideration of energy volatility and future energy prices in all City agency budgeting and planning decisions, including PlaNYC revisions
• universities, civic, business and advocacy groups should form their own Task Forces
• bottom-up voluntary sustainability actions should be accelerated simultaneously with top down incentives, mandates and legislation

Other report recommendations

Transportation:

• implement congestion pricing
• remove hidden subsidies for driving and parking cars
• increase regular and express bus services
• increase alternative fuel and electric vehicle fleets
• implement electric streetcar and light rail systems, as in Vision 42
• implement Auto Free NY plan to maximize use of subway and rail
• build more intercity passenger and freight train capacity
• restrict suburban sprawl
• encourage urban infill development around mass transit access points
• support and expand use of bicycles and pedicabs

Regional production:

• include energy volatility and fuel depletion in City and State economic development policy
• encourage production and procurement of regional farm products
• support agricultural production within cities and suburbs
• enable residents to find farming and gardening jobs
• encourage schools to establish gardens on their facilities
• open additional retail farmers markets, a wholesale farmers market, year-round public markets, and a regional product distribution center
• explore entrepreneurial ways to make private land available to new agricultural workers

Energy efficient building:

• increase mandates and incentives for energy efficiency retrofits
• mandate energy efficiency standards for equipment
• encourage solar heating systems
• design buildings for maximum cost-efficient energy performance
• discourage acceptance of relentless growth in personal electricity consumption

New York City and State energy policy:

• set timetables for PlaNYC’s many good energy initiatives
• expand net metering to 2 megawatts per site for all customer classes
• distribute smart meters/time-of-use meters  
• raise the NYS Energy Efficiency Portfolio Standard to 30% reduction of 2006 electric and gas usage rates by 2015
• update the State Energy Plan to account for energy volatility