Carbon Crack-Up Two Thousand Twelve

Sometime in the year running up to the Presidential election in 2012, Washington will realize it’s made an enormous mistake.  And that mistake is making the ongoing issue of global oil supply subordinate to climate change policy. The result will be neither much improvement in national carbon emissions, nor the addition of enough public transport that allows Americans to reduce their oil consumption. By 2012 I see oil back above 150 a bbl (and also much higher electricity rates), but, no improvement in urban traffic congestion whatsoever. It’s a Green carbon crack-up. Andy Warhol’s Car Accident (in green) sums up the situation pretty well.


We knew this policy was coming. I had conversations with Obama’s energy team last Summer. But now that Secretary Chu has taken the helm at Energy, the policy is crystal clear: Oil supply is not the problem–Climate Change is the problem.

It’s a shame they see it this way. This blog previewed the potential in such a strategic mistake back in early January. With so little Stimulus or Budgetary funding devoted to Rail, I foresaw virtually no aggregate change in transport options for average Americans. Other energy bloggers like Dave Cohen have also picked up on the rather arcane and theoretical views that are now forming energy policy. See Cohen’s brilliant double posts, Steven Chu’s Energy Miscalculations and also The Secretary of Synthetic Biology.

What I find most troubling about the attitude now emanating from the Energy Department, is that biofuels–which have now been proven to be a wasted bullet both as a business and an energy solution–are once again being invoked. And invoked often. Both in last week’s Newsweek column, and in public remarks today at the EIA Energy Conference in Washington, Chu repeatedly acknowledges that we have a liquid fuels problem mainly concentrated in the area of transport. But he then, each time, goes on to deceptively degrade this acknowledgment by assigning the solution to the future development of replacement biofuels. Frankly, I regard that as a kind of jack-move. He is moving that which is core out to the periphery, and placing it into the realm of possibility. That simply will not work.

Biofuels are not a replacement for oil. Biofuels can be a supplement, at best, to liquid fuel consumption. They are poor in energy content, and anytime you begin to talk about really scaling them up you are then triggering potentially massive quantities of water, land, natural gas, fertilizer and plain old electricity to produce them. Chu is talking about replacing up to 30% of oil consumption with future biofuels? After biofuels have already failed? That is quackery.

Prepare for Carbon Crack-Up 2012.


  • InEgoVeritas

    Great post again Greg,

    It is really sad the US Gov is still listening to its agri-business lobby. The only real interesting biofuel that seems to be working is the one based on Sugar Canes used in Brazil. Corn certainly is not a viable alternative. Perhaps some sort of GM crop could do the trick in the future here but likely won't be ready in time for the next oil shock.

  • akguy

    Re: Climate Change, have you been following the lack of Sun Spots? Global cooling may be the 2012 front page story………..


    Yes, I have been following the Sun Spot story. My understanding is that, based on long-term history, it's possible that we have even more years to go in the current cycle. Which would almost certainly guarantee lower earth temperatures.

    More broadly, I am a signatory to the idea that there is a CO2 problem. My view is that Ocean acidification has been proven. I find that quite concerning.

    In my post here, I am really just kicking off a series of posts in which I will attempt to show that energy and climate policy currently will accomplish very little on either score.



    As someone who frankly sees public transport (electrified) as the only real solution that scales to this problem–I am actively seeking those who offer solutions that would trump public transport–but I can't find any yet. North America, because it will always be a place where people will have to use liquid fuels on the Plains, really must go to electrified transport in the metro centers. Powered by new Solar, Wind, Hydro, Geo-Thermal, and Nuclear.


  • akguy

    Agreed, little accomplished but $$ and control to those who craft and mold the “new” clean economy ie Chu.

    Alaska in five years or so may be a very difficult place and become more seasonal as it once was. Head south after “putting in a season”


  • Twigins

    China overexposed to US debt, US didn't do enough to protect China's interest. Who will protect their interests? They will. They've purchased Husky Energy c/w oilsands SAGD projects in several phases. Going after deals with Argentina and S Africa, can expect Putin's already signed.

    Biofuels, what a joke. Anybody remember '92, Cda/US border open unrestricted for feedgrain (destined to biofuels) maybe 6 mos, wheat crop failure, 5AD trading for 0.85 C$/bu. Then the American farmer and lobbyists rode the tractors to block the borders.

    Biofuels and “potential acreage loss” will inflate foodcosts far sooner, far harder than oil $150. Better buy some beef, boys as all land will be farmed, nothing left for a cow unless you ship them in from Prince George and Alta Peace country.

    Destroy the world's cheap food supply in quest for fuel …. how green is that.


  • James

    Greg, it is false hope to rely on the government to provide such a substantial change to the modern way of life.

    Milton Friedman said “The greatest advances of civilization, whether in architecture or painting, in science and literature, in industry or agriculture, have never come from centralized government”

    As a People, we will develop new technologies in time. However, unless oil prices reach much higher levels in the near term, there lacks incentive to develop alternative technologies as well as substitute away from oil. However, don't look to the government to provide a long-term solution to any of our problems.


    I don't agree with Milton Friedman at all. But, by disagreeing with Milton Friedman, you should not also think that I reject Friedman.

    Milton's quote is totally incorrect on a historical basis. In fact most of the huge advancements in human history were made in partnership with the power structure, whether that was Royalty, or the Governments. Milton is having a fantasy about a human history that never existed. Roman aqueducts were not built by VCs.

    Which is my point: only governments can build big projects like Rail.

    But as I said, you should not take from my remarks that I reject Friedman. Nor do I reject his core philosophy.

    There is NOT an exlusively free-market, entrepreneurial solution to the problem. It will have to be both. Again, my assertion will likely be misunderstood because we have a false bifurcation in this country about private vs public initiatives, and projects.


  • representative form of government can only be reactive

  • representative form of government can only be reactive

  • representative form of government can only be reactive