PALO ALTO, Calif.--T. Boone Pickens offered qualified support Thursday for the Obama administration's plans to reduce the nation's reliance on imported energy but said Washington's track record doesn't fill him with a lot of confidence about the will of the political class to get the job done.
Pickens
(Credit: CNET )"We have to get a plan going," said Pickens, who made his comments at the Global Technology Symposium at Stanford. He is the founder and chairman of BP Capital and has been promoting his own plan for energy independence since last year. The so-called Pickens Plan would exploit the country's "wind corridor" from the Canadian border to West Texas to produce 20 percent of the country's electricity.
The Texas oil man said dealing with the political class the last 40 years has left him skeptical about Washington's ability to plan in the absence of an immediate crisis. But just to drive home the point, Pickens said that his supporters planned a "virtual march" for April 1 with the roughly 2 million people who have signed up on his Web site ready to send e-mails and faxes to their elected officials.
"I do have an army now," he said. "We are going to have an energy plan and it's going to come from the grassroots. What it's going to say very clearly is that we want an energy plan...It has got to be done."
He was blunt about what he described as repeated failures of leadership dating back to the Nixon administration, when he said the government first promised to curtail the United States' reliance on imported oil.
"We spent $700 billion last year (on foreign energy imports) and we'll spend about $450 billion this year," he said.
"It's been a lack of leadership for the last 40 years," he said, describing the status quo as "a war without guns."
Call it serendipity but Pickens' comments come just as a new study predicts a sharp drop in oil supply production because of falling investment, a development that could be a harbinger of higher prices when the global economy picks up again.
Speaking about the new administration, Pickens said President Obama had shown interest in what the Texas oil man has had to say about developing alternative sources of energy. At the same time, however, he said the country's leadership needs to expand its horizons to include greater development of available natural resources--including gas and oil--in this country to augment the development of new technologies.
"It is America and there's nothing wrong with drilling," he said.
Hopes for renewable energy may not be a pipe dream after all.
After nearly a year of squabbling, the U.S. Senate voted Tuesday to extend solar tax credits for the next eight years and also remove the $2,000 cap on residential projects.
(Credit:
CNET News)
What with all the political bickering, I was betting this wouldn't ever get done before the November elections. But the hired help in Washington provided a pleasant surprise for a change. The bill, which includes an allowance for utilities to make use of the commercial credit, now goes to the House of Representatives for approval before everyone clears out of town next week. The current tax credit was set to expire at year's end.
Doubtless there will be some ready to dun the agreement as yet another handout to an interest group. On the surface, that's true. But after the government's recent series of bailouts including--drum roll, please--Bear Stearns, Freddie Mac, Fannie Mae, AIG, and the $700 billion or so the Treasury Department wants to buy illiquid mortgage-linked securities--this one should mollify the critics, according to Barry Cinnamon, CEO of Akeena Solar.
"I don't think anybody is going to look at $17 billion over 10 years going to renewable energy as a handout when you put it in the perspective of $1 trillion going to failed banks in a one-year period," said Cinnamon. He added that while he did hear the handout argument a couple of years ago, he's not encountering that line of argument, what with crude oil prices hovering north of $100 a barrel.
Cinnamon and other solar industry executives have argued that the industry is still too young and too fragile to be weaned off the investment tax credit (ITC) just yet. Solar energy lobbyists released a study by Navigant Consulting claiming that 440,000 permanent jobs and $232 billion in investment would be supported by 2016 with an eight-year extension of the ITC.
However, that argument wasn't persuading enough Senators to pledge their support to the investment tax extension. In fact, when Congress passed the 2007 energy bill, the solar industry got shut out. The ongoing debate had a lot to do with accounting. While Democrats wanted to pay for them by taking away tax credits from the oil industry, the Republicans held firm.
A couple of recent developments helped break the logjam. One was the willingness of congressional Democrats to go along with an offshore-drilling proposal. The other was a statement from the White House that it would not oppose extending the tax credits.
"The great thing about this bill is that it's going to allow people throughout the country to benefit," said Cinnamon. "It will be as much for people in Peoria as it will be for people living in Pleasanton."
Editor's note: What with the price of gasoline near record highs, attention increasingly focuses on the race to deliver battery-driven automobiles. But even with advances in this and other alternative technology areas, this remains a work in progress. As they say, we're likely going to remain dependent on oil for the foreseeable future. Apropos, I recently came across a provocative column by Greentech Media's Michael Kanellos, which I'm reposting as a guest column. Might his look-back scenario have worked out? We'll never know. Still, it's a good read. What's your take? Leave your comments in the TalkBack section below.
Michael Kanellos, Greentech Media
(Credit: CNET Networks)U.S. Secretary of Defense James V. Forrestal was terrified. The year was 1948 and diplomats worldwide contemplated what might occur if various nations recognized Israel as a separate state.
If the United States had decided to recognize the soon-to-be nation, Arab nations might cut off oil shipments, which in turn could imperil the Marshall Plan, which in turn could provide momentum to the communist juggernaut.
In a decade, "the nation could be forced to convert to four cylinder cars," he confidentially predicted. (The quote has been cited in several books, including O Jerusalem by Larry Collins and Dominique Lapierre.)
The oppressive boot heel of socialism and wimpy cars! Men surely didn't lay their lives on the line at the beaches of Anzio for that. In the end, the U.S. recognized Israel, the oil embargo of 1948 didn't occur, and Detroit didn't have to emphasize economy cars for three more decades.
But it makes me wonder. What would have happened if Forrestal's fears had come true? What if the Gulf nations had imposed a strict embargo and the United States was forced to go four-cylinder and cut down on gas starting in 1948?
For one thing, U.S. auto companies likely wouldn't be the bumbling boneheads of the industrial world. General Motors, Ford, and Chrysler would have had to retool quickly. But turning on a dime was something they learned to do thanks to the wartime experience, when the federal government ordered these automakers to start building planes. Germany and Japan were still in shambles at the time so U.S. automakers could have eked out an early, sustainable lead.
In turn, that might have meant softening, or even avoiding, the blight that hit Detroit in the 1970s. And the focus on efficiency could have bled into the steel industry. Who knows? The U.S. could have become an early leader in solar manufacturing with all the intellectual capital focused on efficiency and energy.
OK, a vibrant economy in the Great Lakes would likely have doomed the musical careers of Grand Funk Railroad and Bob Seger--the beer rock movement just wouldn't have the same oomph without mass unemployment. But it's a small price to pay.
Alternative fuels like biodiesel and ethanol? A thriving industry would have probably emerged. The lack of cheap oil would have put farmers and chemists on the hunt for substitutes. (Biofuels work, but they just cost more than gas. Less gas would have opened an opportunity.) The wealth generated would have made Kansas look like Palo Alto.
Iran? Wouldn't be a problem. Britain and the United States organized a coup in 1953 against Mossadegh, the then-prime minister who wanted to nationalize Iranian oil assets. The coup led to the Shah on the throne. Better efficiency and alternative oils would have meant no coup, no Shah, no 1979 Iranian Revolution, and no Great Satan Bookstore in the old CIA headquarters in Tehran.
Jimmy Carter might have served two terms (or, more toward the wishes of you conservatives, never been elected at all). The Ayatollah Khomeini, meanwhile, likely would have been a guy on a park bench. As a country with a fairly well-developed middle class and educational system, Iran would likely have emerged as a shining star in globalism.
Terrorism? It would have occurred--the cultural, political, and religious issues of the Mideast made war inevitable. But the oil-rich nations of the Gulf wouldn't have had as much money. In turn, that would have meant less of the "affluent poverty" of those nations. Instead of relying on family wealth and government-made jobs, more kids in those nations would have attended college. Which in turn would have meant more "normal" nations and likely less radical political fringes.
Global warming? Still a problem, but it would have come on more slowly and might have been easier to ameliorate. Then again, people could have reacted to it slower. But even as global warming began to appear, we'd have had more experience to combat it. So chalk that up as a positive, too.
Muscle cars? Well, you can't have it all. NASCAR fans would be cheering on drivers from the Opal team. Mattel would have likely have scuttled Hot Wheels too.
Offshore oil drilling? Wouldn't be needed. In fact, when you think about it, there wouldn't be much to debate in the 2008 presidential election.
That's a problem I could live with.
The views in this opinion piece are not connected with Greentech Media news.
Earlier this month I was in Israel moderating a panel on the myths and realities of alternative energy. The good news to report is that technologists are making steady headway in so-called green alternatives like solar and wind. The bad news is that governments aren't yet providing enough investment support for their ideas.
(Credit:
CNET News)
So it's been more than slightly amusing to watch the media circus around the discovery by the United States Geological Survey that the Arctic may hold around one fifth of the planet's future oil and natural gas reserves. Since that Wednesday announcement, every talking head worth his or her salt has been paraded (in some cases multiple times) on Fox, MSNBC and CNN.
But beyond the predictable polemics, is it such a grand idea? Alternative energy technologies represent the future, and drilling in the Arctic constitutes yet another (temporary) diversion. Others have pointed out that we're talking about only three years' worth of oil (at current consumption rates), though the natural gas reserves in the region are gauged to be three times as large. Texas oilman-turned-wind power enthusiast T. Boone Pickens, hardly a garden variety Berkeley leftist, is hitting the stumps making the case that "this is one emergency we can't drill our way out of."
All of which left me wondering what it's going to take to force public opinion to dispense with the fiction that cheap oil is only one or two big drilling projects away. With Ford and General Motors now anxious to get rid of truck and large-vehicle divisions as fast as they can, clearly, change is in the air.
My former CNET colleague, Michael Kanellos, now working for GreenTech Media, offers a fascinating what-might-have-been had the Arabs followed through with an oil embargo if the United States recognized Israel in 1948. Kanellos argues that a strict embargo would have forced the U.S. auto industry to move to 4-cylinder cars and fostered a more conservation-conscious approach.
For one thing, U.S. auto companies likely wouldn't be the bumbling boneheads of the industrial world. General Motors, Ford and Chrysler would have had to retool quickly. But turning on a dime was something they learned to do thanks to the wartime experience, when the federal government ordered these automakers to start building planes. Germany and Japan were still in shambles at the time so U.S. automakers could have eked out an early, sustainable lead.
In turn, that might have meant softening, or even avoiding, the blight that hit Detroit in the 1970s. And the focus on efficiency could have bled into the steel industry. Who knows? The U.S. could have become an early leader in solar manufacturing with all the intellectual capital focused on efficiency and energy.
History worked out differently. The Arabs didn't impose an oil embargo until 1973. The resulting gasoline shortage forced a shift in consumer preferences for smaller, more efficient vehicles. Temporarily, that is. Then Detroit went back to its business as usual. We know the rest of the story.
What do you know? The do-gooders had a good idea: A 50 percent reduction in power consumption by computers by the year 2010.
(Credit:
CNET.News.com)
This was a central plank of the Climate Savers Computing Initiative, a nonprofit initiative which is celebrating its one-year anniversary this month. Most of the usual suspects have thrown their support behind the project. (Here's a link to the full list. These folks aren't signing on out of any woolly eyed desire to save humanity--though that's a nice idea. They're doing it to help their bottom line. (Even better!)
So it is that on Wednesday comes news that Dell has developed a server power supply which complies with the 80 Plus Gold certification. A good first step, though the bigger question of clean technology and the role it might play in helping to curb data centers' energy output remains unclear.
Dell's PR moment is one small advance in the right direction. Unfortunately, data centers haven't been getting any greener. When Earth Day rolled around in April, we reported on a study which found that "three-quarters of those surveyed graded themselves a 'C' or worse for green computing, and 65 percent said they lacked precise plans for improvement."
Speak with IT managers and if you can find one reporting that their energy costs are going down, send me their number. But if technology helped get us into this mess, technology is going to pull us out of it (or at least one can hope). The timing on Dell's news was purely happenstance, but I came across two headlines recently which nicely framed the question du jour. The first referred to a report by Cambridge Energy Research Associates, predicting the following: "Response to Global Climate Change to Spur $7 trillion in Clean Energy Investment by the year 2030." The other was a prediction by Texas oilman T. Boone Pickens: World Crude Oil Production has Peaked." (In other words, there ain't a lot of this stuff left in the ground so get ready to pay a lot more--or find viable alternatives.)
Who knows which forecast comes closer to the truth? But clearly, these are extraordinary times with lots of opportunity as well as lots of confusion about where technology's future should head. I suppose all this is good news for clean tech's future, though it seems we've been talking about this "future" for the better part of several years now. What I'm anxious to know is how much longer before its impact really begins to manifest itself in ways which impact the society as well as the global economy? (Next week I'll be moderating a panel discussion on the same subject so if you have any questions or thoughts on the subject, e-mail me at charles.cooper@cnet.com.)
It was simply happenstance but this headline crossed the wire just as I was boring a colleague with another doom-and-gloom update on the skyrocketing price of energy.
"Fortune 500 Visionaries Speak at Woodside Private Home Theatre for Discussion on Smart Energy & Grids."
Telecommuting's best argument
(Credit: CNET Networks)Turns out that Scott McNealy and Jim Rogers of Duke Energy are headlining the event next week along with CEO Echelon Ken Oshman to celebrate what's being billed as "20 Years of LonWorks Technology."
For anyone unfamiliar with Echelon, the company's embedded control technology fosters "smart energy" applications in homes and businesses. If we're going to figure out how to thrive in a future annotated by increasingly expensive energy costs, tech companies like Echelon will take the lead. Couldn't happen fast enough, because the near term is looking bleak. The price of crude pushed past the $126 a barrel line Friday for the first time. For what it's worth, Goldman Sachs predicts that oil prices may hit $150 or even $200 a barrel in the next six months to two years.
All this is making IBM's Mike Rhodin look more prescient by the day.
A couple of months ago, Rhodin, the general manager of IBM's Lotus group, gave a speech at the VoiceCon conference where he talked about the emergence of the "virtual workplace," in which employers increasingly let their people telecommute. (Here's a link to the press release where IBM summarized his remarks.)
Larry Dignan over at ZDNet rhetorically asks whether IT managers are ready for that shift, noting that the "jury's still out." "Companies weren't ready for mass telecommuting back when avian flu was a hot topic. And it's doubtful that they are ready now."
That may be true, but IT, circa 2008, is better equipped than it was in 1998 to handle the infrastructure demands of a more dispersed workforce. And if it isn't 100 percent ready for a big crush in demand, there's no time like the present to get moving. But CTOs are waiting for the directive to come from the office of the CEO. That day can't be far off. With gasoline prices in many places hovering around $4 a gallon, the writing's on the wall.
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