How to Live Without Oil
New energy sources and efficiency could make petroleum obsolete.
By By Amory B. Lovins
Newsweek International
http://msnbc.msn.com/id/8769620/site/newsweek/
Aug. 8, 2005 issue - In 1850, most homes in the United States
were lit by lamps that burned whale oil. As demand rose, supply
dwindled-whales became shy and scarce-and prices for whale oil
climbed. Then alternative fuels such as smokeless, odorless
coal-kerosene began to sweep the market. By 1859, when
Edwin Drake struck oil in Pennsylvania, five sixths of all whale-oil lamps
had switched to the new fuels. The astonished whalers, who hadn't
heeded the competition, ran out of customers before they
ran out of whales.
Oil may now be poised to repeat that history. With prices
exceeding $50 a barrel, the world's oil habit now costs
$4 billion a day. Some experts warn that output will soon peak
and prices will reach $100, but nobody really knows for sure
(94 percent of reserves are owned by governments, which
generally keep the data secret). Fortunately, it doesn't matter:
With cheap oil-saving technologies and alternative fuels already
at our disposal, the sooner we get off oil, the sooner we'll
start making bigger profits.
That's right-profits. The conventional wisdom is that $50-a-barrel
oil has made alternatives to fossil fuels economically viable. But the
truth is that they were viable back when oil was $25 a barrel. The
arguments in favor of phasing out oil have now merely become overwhelming.
That's true everywhere-but nowhere more so than in America, the
world's biggest oil consumer. It's entirely possible to cut projected
U.S. oil consumption in half by 2025, and eliminate it completely
by 2050, without compromising rapid economic growth. Demand
could be halved simply by using oil twice as efficiently over several
decades; the other half could be replaced with saved natural gas
and advanced biofuels. According to a U.S. policy analysis we
published last year at Rocky Mountain Institute
("Winning the Oil Endgame"), the cost of these changes would
average $15 a barrel. Even if, as the U.S. government forecasts,
oil comes down in price by 2025 to $26 a barrel, the net saving in
the United States would still be $70 billion a year, and the rest of
the world would benefit proportionally. Burgeoning economies like
China and India have the most to lose from falling into a
U.S.-style oil trap, and the biggest opportunity to avoid it by
making their vehicles, buildings and factories efficient from scratch.
Doubling oil efficiency wouldn't be hard. A backlog of powerful ways
to save and substitute for oil, amassed since the 1973 oil embargo,
remains mostly untapped, even in the most energy-efficient countries.
Automakers for instance could profitably increase fuel mileage to
66 mpg (3.6L/100km) for light trucks and 92 mpg (2.6L/100km) for cars.
Doing so would cost an extra $2,550 for a midsize SUV, but would
pay for itself in fuel savings in two years in the United States
and in one year in Europe.
This would require combining hybrid-electric propulsion with
new lightweight steels or, in a few years, carbon composite parts
that absorb six to 12 times more crash energy per kilogram.
New manufacturing processes could then make cars big, protective and
comfortable with halved weight and fuel use at no extra cost. The
U.S. military could pioneer such ultralight, ultrastrong vehicles to
modernize its forces.
Modern aerodynamics, tires, engines and materials can cheaply
double or triple the efficiency of 18-wheel heavy trucks and
jetliners, too. Boeing's new 787 consumes 20 percent less fuel
per passenger mile than its predecessor. Retooling the U.S. car,
truck and plane industries would require a $90 billion investment.
That may sound like a lot, but spread over a decade, it's worth about
three weeks of U.S. oil imports a year. Other countries' retooling
would typically yield at least as handsome profits in both money
and security.
Once the United States has saved half its oil, it can cost-effectively
replace an additional 20 percent with advanced biofuels, and the
rest with saved natural gas. Biofuels (based on woody, weedy
plants-not corn) will need a $90 billion investment, too, but they'll
beat $26 oil, revitalize farming, protect topsoil better and preserve
food crops' land and water. Harvesting biofuel crops, carbon credits
and wind power all from the same land, much of it now unproductive,
can also double or triple net farm and ranch income.
Again, details will differ in other countries, but the opportunities
are broadly similar-even in Japan, which lacks the Great Plains but
is 70 percent forested and could substainably harvest both fiber
and biofuels there.
Eliminating oil demand in the United States would thus require a
$180 billion investment, half for efficient vehicles, half for
advanced biofuels. By 2025, that would save $155 billion every
year, create a million new jobs, save a million current jobs and
generate 26 percent less carbon emissions. Benefits in Europe,
Asia and Latin America are proportional or better. Even
oil-exporting countries could benefit: oil may well ultimately be
worth more for its hydrogen content than for its hydrocarbons.
Mandates, subsidies and taxes aren't needed to implement these
changes. What's needed are smart business strategies and
enlightened government policies that remove barriers to adopting
new technology. The most important would be to offer "feebates"-
a charge on inefficient vehicles that would be rebated to buyers of
efficient ones, within each size class. Government would also play
a role in helping retool car plants, retrain workers, scrap
gas-guzzler planes and cars, and so forth. Customers would have
more choices, workers more jobs, everyone more profits. In only
two generations, oil-once the foundation of our strength but now a
source of weakness-could become as obsolete as whale-oil lamps.
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