Interview with Pickens (Lou Dobbs)

Lou Dobbs interviews T. Boone Pickens.

Once again, in a nuthshell. Natural Gas makes up 20% of our electricity. Pickens suggests freeing up that 20% to move into transportation fuel (as LNG or CNG) and replacing it with wind (though any other energy source would work as well. That would reduce our oil imports by roughly 40%. We currently import 70% of our oil.

Pickens Picks Wind and Natural Gas

"The Pickens Plan."

"The Pickens Plan" calls for investing in domestic renewable resources such as wind, and switching from oil to natural gas as a transportation fuel.

On the wind side of things:

Pickens' company, Mesa Power, recently announced a $2 billion investment as the first step in a multibillion-dollar plan to build the world's largest wind farm in Pampa, Texas.

Pickens said Tuesday that if the United States takes advantage of the so-called "wind corridor," stretching from the Canadian border to West Texas, energy from wind turbines built there could supply 20 percent or more of the nation's power. He suggested the project could be funded by private investors.

And on the natural gas side of things:

Fueling these plants with wind power would then free up the natural gas historically used to power them, and would mean that natural gas could replace foreign oil as fuel for motor vehicles, he said.

Using natural gas for transportation needs could replace one-third of the United States' imported oil and would save more than $230 billion a year, Pickens said.

So how long until we can see the effect of these changes?

His energy plan could be implemented within 10 years if both Congress and the White House treat the current energy situation as a "national emergency and take immediate action," he predicted.

We better get started.

More about that link ...

... between food and fuel.

This article cites Lester Brown, who wrote Plan B 2.0. It's a very informative book, and an excellent read. He's also come out with Plan B 3.0, but I have not had a chance to read it yet.

Anyways, back to the article. There are many issues with using corn grain as a fuel. One of the main reasons is easily seen in your supermarket. Corn diverted to fuel affects more than just the price of corn for consumption. Corn is used as feed for cattle, poultry, and swine. The article relates the following ...

Now, however, the legislation is being criticized for making food more expensive while gasoline prices continue to climb. Rick Perry, a Republican who succeeded Bush as Texas governor, has asked the Environmental Protection Agency to waive half of the "misguided" ethanol requirements because of rising food costs; every penny increase in per-bushel corn prices costs his state's livestock industry $6 million a year, he said.

That increase in cost is eventually transferred to the consumer. I don't know about you, but I'm tired of looking at $7.99/lb for a London Broil and $4.99/lb for chicken breast meat. Matter of fact, I got so tired of it that my wife and I have gone to a mostly vegetarian diet. Fortunately for both of us, there is a farmer's market not too far from my place of employment, and we don't mind eating a lot of vegetables. The loss of corn from the food market also has the effect of placing greater strain on the other food grains. While I'm no economist, I imagine that's at least part of the reason we're seeing an increase in the price of wheat (flour), and rice. As we consume more of these staples, as replacements for corn, our demand for them increases their prices as well. It's a vicious cycle.

Then there is the little nagging fact that corn ethanol might not really be the silver bullet when it comes to saving us from high fuel prices. Why? There just isn't enough of it. Look at the following figure, provided by the University of Tennessee Agricultural Economics Department report 25 x 25 (25% Renewable Energy for the United States by 2025).

That yellow section at the bottom is corn grain (when looking at the report, this figure is found on page 33, it's Figure 11). Through 2025, you can notice that there really isn't an appreciable increase in the amount of corn grain over the next 15 years. Instead, we really need to be looking at the dedicated energy crops (the green section on the chart). Unfortunately, they're not really expected to come online for another 5 years or so. This is, in part, due to the need for increased efficiency for cellulosic ethanol production. One question that can be asked however is, is that even necessary? Thermochemical processes can be brought to bear today, and those crops, which are already being (or are) planted could be used in gasification. Production of methane from that process could be scrubbed clean, essentially becoming "natural gas". Compressed (CNG) and Liquid (LNG) Natural Gas are already used in vehicles across the country. T. Boone Pickens, an oil magnate in Oklahoma has suggested that NG be used on his own website.

While chairman of the National Natural Gas Vehicle Coalition for almost three years, Pickens traveled the country advocating the merits of natural gas. When he left Mesa Petroleum and its management wanted to divest of the natural gas fueling concerns, he purchased them and in 1997 formed Pickens Fuel Corp. He touted natural gas as the best alternative vehicular fuel because it’s a domestic resource that reduces our foreign oil consumption, and enhances America’s energy security; clean (NGV vehicles emit up to 95 percent less pollution than gasoline or diesel vehicles); less expensive than petroleum and hydrogen; and safe (lighter-than-air compressed natural gas is nontoxic and disperses quickly, and has a higher ignition temperature than gasoline and diesel fuel, which reduces the chances of accidental ignition).

Obviously, we're going to experience some growing pains, as we change our infrastructure to adapt. The question is, are we as scrappy and as resourceful as previous generations seem to have been? Honestly, I think it'd be easy for the government to help out as well, when you consider where all our tax dollars are currently being spent. You know this "economic stimulus package"? Why not save that and give it as a tax credit for people who would convert their existing gasoline car into a LNG car instead? I believe the conversion kit costs between $1.5K and $2K. Don't you think that would boost the economy a bit as well? I think there is hope for our country, but this isn't going to be an easy fix. I think the younger generations are ready to make this change, the question is ... are the Baby Boomers? They're the largest voting bloc this election year.