A New American Energy Policy

One has to wonder when a country has such fine engineering schools why its “engineering economy” is in such disarray. Think of all the great engineering schools in this country: MIT, Cal Tech, Stanford, Georgia Tech, the University of Illinois, Cal Berkeley - the list goes on and on (sorry if your alma mater was omitted). These engineering schools are regarded amongst the best in the world, and students from India, China, the Middle East and Europe, all across the world come here to study.

With all these fine schools, the inevitable question pops up: why are we non-competitive in cell phones, automobiles, mass transit, and leading edge manufacturing? There is some good news…the US is home to Google (GOOG), Boeing (BA), and some high level electronic and computer systems design, and we are real good at military defense (although certainly not cost efficient in that area), but overall, when it comes translating our engineering school prowess into US economic advantage, we seem to be lacking. What is that vital ingredient?

The answer is twofold: management and policy. How else can one explain Motorola’s (MOT) fall from inventor of the cell phone to a 3% market share? Or the “Big 3” automakers' approaching bankruptcy? Let’s face it - US management of multi-national corporations couldn’t care less about American economic performance. Greed is their biggest concern, as shown by the tremendous increase in CEO executive pay. It’s hard to notice many of these same executives became very wealthy while they drove their companies into the ground. Seems like anyone could do that, so why pay out the nose for a Harvard MBA with a pedigree? You might be much better off with an engineer!

From a policy perspective, Congress is only too willing to participate. For years, companies were actually rewarded for shipping jobs overseas. Small businesses were given tax breaks to purchase SUVs, thereby negatively influencing Detroit’s problems. Congress sold out to big oil and auto lobbyists and refused to raise fuel-efficiency standards. Let’s face it, engineering expertise in America is sufficient if not superb, but management and policy is pathetic. Throw in unregulated financial markets and some unwise decisions from Washington, and boy, are we in for a world of hurt.

I was reading the Saturday edition of the Wall Street Journal when I came upon an article about Obama’s desire to increase the percentage of the Transportation and Infrastructure budget stimulus package dedicated to mass transit. It would take this additional share from the highway and bridges, and showed this chart:

Highways & Bridges	$30.25
Other	$19.00
Environmental Infrastructure	$14.28
Transit	$12.00
Aviation	$5.00
Rail	$4.90

Total $85.43 Billion

Traditionally, the article says, mass transit is usually funded at 25% of highways and bridges, so this budget (40%) is an increase. Although I agree very much about increasing funds toward mass transit, what does this table tell us about “management and policy”? Well, first off, I cannot help but noticing the total of $85.43 billion is much less than the $700 billion given Paulsen to “bail out” the Wall Streeters and bankers. Second of all, wasn’t it Hank Paulsen who years ago was such a big supporter of the deregulation of the financial industry which is partly to blame for its demise? Ok, well, I suppose it’s time to reward him for his excellent performance in that regard. So much for “management.”

With respect to policy, what this chart tells me is, despite $145/barrel oil and $4.50/gallon gasoline, we still don’t seem to get the big “policy” issue right, and of course I am speaking about energy. Although I agree wholeheartedly with spending more on mass transit, why is the highways and bridges portion funded at such levels when we have seen a drastic reduction in the number of miles driven this year? Doesn’t it seem more strategic to make sure you have the right vehicle mix (NGVs, electric, and hybrid) to drive on these roads and bridges before building out the infrastructure further?

Also, I sure would like to see a breakdown of the “environmental infrastructure” portion of this budget. How much for natural gas powered transportation and infrastructure? Sure, it’s a fossil fuel, but it is considerably better from an environmental aspect than is gasoline. What about electric battery research and development? A recent article in the Economist magazine opined the US is about to trade its dependence on foreign oil to Asian dependence for electric batteries. That can’t be good.

What about rail? Does that include high speed rail or is that considered “mass transit”. Why is rail so small? What constitutes “Other”? Bottom line, it is amazing to me that we can send Paulsen $350 billion, and now he’s back for the next $350 billion, with a blank check, and then we look at what is being spent on “infrastructure” and not only are the numbers much smaller, but I have to seriously wonder about the “management” and “policy” measures indicated by the raw numbers shown in this article. The Obama team has a wonderful opportunity to begin some great programs with this stimulus money – are they going to blow it?

Which of course brings me back to my favorite subject: how can America engineer an economic recovery and take control of its future economic performance? The answer is simple: adopt a strategic, long-term, comprehensive energy policy. Apply common sense management to this policy, and the country has a chance. Windfall profits taxes on big oil? Certainly not! That is a big policy mistake. Bailing out GM and Chrysler without requiring the existing CEOs to step down? That is a big management mistake. So, Congress continues to make management and policy errors (big surprise huh?). That said, below I give them an energy policy. It is up to them to manage it properly. Here it is.

A Strategic Long Term Comprehensive Energy Policy

STEP 1: Acknowledge the Problem

No difficult problem can be solved until it is first acknowledged. US government and media need to honestly inform and educate the American people and policy makers at every level about the threat worldwide oil supply/demand realities pose to the US. The US uses 25% of worldwide oil supply, yet owns only 3% of the world's proven reserves. The US imports 70% of its oil, enriching unfriendly countries such as Russia, Saudi Arabia, Venezuela and Iran. We are going bankrupt in the process, not to mention funding both sides of the "war on terror". Our US dollar currency is weakening. These are the basics of the energy challenge facing America.

The energy crisis needs to be attacked with realistic information and wise policy decisions. A strategic, long-term, comprehensive energy policy must be adopted, publicized, and executed. The basic components of such an energy policy are listed below.

STEP 2: Conservation and Energy Efficiency

• Increase gas guzzler tax penalties and encourage gas sippers via increased tax rebates.
• Increase CAFE standards. "Open fuel standards" autos should be encouraged.
• Impose a top speed limit of 60 mph nationwide.
• Adopt four-day workweeks wherever and whenever it makes sense.
• Conservation and efficiency guidelines should be issued by federal, state, and local governments with respect to building codes, lighting standards, etc.

STEP 3: Transportation Initiatives

• Government encouragement and tax incentives for development of non-gasoline powered personal transportation and mass transit. This includes natural gas vehicles (NGVs), electric vehicles, and hybrids.
• Natural gas transportation initiatives: develop affordable natural gas refueling appliances for home garage installation; build out natural gas refueling stations along the nation's interstate highway system; government vehicle fleets should switch to NGV’s. Encourage local municipal use of natural gas (refuse pickup, buses, mass transit, etc).
• Develop electric and natural gas powered mass transit for people and goods.
• Institute a new federal gasoline sales tax – let’s call it the “energy freedom tax”. This tax will begin at $0.04/gallon in 2009 an increase $0.02/gallon every year for the next 20 years. The revenue generated will go *only* toward building the natural gas, nuclear, and electrical infrastructures.

STEP 4: Prioritize and Invest in Non-oil and Oil based Energy Sources

• Construct a trans-Canadian natural gas pipeline from Alaska to the lower-48.
• Begin a government sponsored “battery technology” program (similar the successful Sematech organization for semi-conductor technology) in order to insure that the US is not only the leader (we are way behind now…) in battery research and design, but also in battery *manufacturing*.
• Invest in natural gas infrastructure, wind, solar, nuclear, geothermal, and tidal energy to power non-gasoline powered transportation solutions described in STEP 3 above.
• In order to use the power generated from the above non-oil sources to power automobile solutions, update the natural gas & electric grid infrastructures and dramatically increase the capacity of both.
• The government must deem electric transmission lines a matter of national security and thereby invoke eminent domain in order to construct them as needed to deliver solar and wind energy from source to consumption.
• Wind and solar power generation of hydrogen via electrolysis as a storage mechanism for calm and cloudy days. Hydrogen power generation needs encouragement.
• Streamline permitting and construction of LNG terminals on both US coasts.
• Streamline permitting and construction of latest generation nuclear power plants.
• Open the continental shelf and Alaska to oil and gas drilling. Extract royalties on these resources to assist funding of the non-oil based components of this energy plan.
• Research and development of clean coal-to-liquids and coal gasification.
• Biofuels should be encouraged but not at the expense of runaway food inflation.
• Abolish corn ethanol mandates. They cause major distortions in the food chain, inflation, and development of other more economic alternative energy sources.
• Abolish import taxes on Brazilian ethanol.

STEP 5: Social Initiatives

• Encourage local sustainability in energy, food production, and transportation.
• Encourage population control through education.
• Encourage green power education, business, and industry.
• The US voting public should demand energy accountability by its political leadership.

These are the tenets of a sustainable and strategic long-term American energy policy. However, as shown before, policy is insufficient without effective management: we need both.

The other day a friend of mine said “Fitzman, you do realize the greenies are going to kill the US economy?!” To which I replied “while that is a projection, it’s quite clear the current oil-centric policies of the US are not only killing the economy but also the environment along with it.” So, many folks still don’t agree with the need for such a comprehensive energy policy to move away from oil, and current low oil prices do nothing to support my advice. That said, the only way we can insure our economy will prosper in the long-run is to reduce our dependence on foreign oil.

Does anyone really believe once the world economy recovers and oil demand picks up again, oil prices won’t again reach skyward? Foreign oil producers will again be in the catbird seat and will be able to checkmate the US economy (again), like a horribly bad movie re-run. In an era where worldwide oil supply will not keep pace with worldwide oil demand, a country that uses 25% of the world’s oil simply must take steps to reduce that oil dependence.

The energy policy above does just that. We could easily reduce our foreign imports by 10% in one year by adopting this policy. Moving a portion of our cars and trucks and fleets to natural gas over the next 5 years could save another 5-10%. That’s an easy 15-20% of imports (some 3 million barrels of oil a day) that is relatively low-hanging fruit, meaning it’s achievable via policy adoption and currently available technology and American resources. That buys us valuable time to begin the build out of wind and solar and nuclear energy supplies and infrastructure. It also buys us time to develop the battery technology and electric cars to make use of the new alternative energy supplies.

America can have a bright economic future, under our own control, while simultaneously reducing green house gas emissions. But we need less financial tom-foolery, more applied engineering, and a strategic energy policy driven by competent management. Only then will we have equity and currency markets that will be worthy of long-term investing. It can be done. There would be a plethora of investment opportunity associated with such energy policy initiatives.

The jury is still out on whether or not the Obama team has the right stuff to craft stimulus policy directed toward our biggest challenge (foreign oil dependence along with an oil based economy). Hopefully they do (I am available at no charge if they need help). The next decade is critical for the US to solve its energy problems. We must make a gigantic leap in the right direction starting in 2009. We likely will not get another chance and we have a few short years before the realities of peak oil and the worldwide supply/demand equation catch up with us yet again. We had better be a good way toward solving the problem by then - there won’t be anyone to bail America out of the next energy crisis.

Comments

[Itsonlymoney:]

I like your call for an Energy Freedom Tax but it seems to me to be a bit on the low side. Why not pay ourselves the next $1 on a gallon of gas since sooner or later OPEC will be getting another $1 anyway.

I'm still skeptical of nuclear power. When Amory Lovins says it's OK then I will reconsider. Otherwise I like most of what you outline.

2008 Dec 22 11:25 AM

[longoil:]

Fitz,


I agree with 98% of your plan, except for hydrogen. Hydrogen takes considerably more energy to make than is returned from it. It can be made from electrolysis or stripped from natural gas. It is a far better use of electricity to charge electric cars directly or use natural gas directly in NGVs than having an energy wasting middleman (i.e. hydrogen).

By the way most people George W. Bush has an MBA from Harvard, but most people do not know that Warren Buffett was refused entry into Harvard business school. Someone explain that one to me !!!

2008 Dec 22 01:26 PM

[User 283977:]

I agree that the number one policy of the United States should be the development of a comprehensive energy policy designed to reduce our dependence on foreign oil. All other goals should be coordinated with that goal. A second goal is to rebuild the manufacturing sector in the United States. If we don't do that, we are basically removing our ability to innovate in the manufacturing process. We should be the leading country in rapid prototyping and robotic manufacturing, not other countries. You can't get there if you don't build anything. I believe the problem you allude to in your second paragraph is not with our schools, the problem concerns myopic management decisions combined with terrible government policy.

One of the quickest ways to increase profitability is to ship the manufacturing process out of this country to a country with a lower standard of living. There are several consequences associated with outsourcing manufacturing. First, the country looses manufacturing jobs. Second, a major technology transfer takes place from this country to the lower cost manufacturing countries (e.g., Taiwan, China). Third, a major portion of the upside profitability of product improvement is lost. For example, Product X is invented in the United States. In order to maximize profits, our myopic management out-sources the technology to a low cost manufacturing country. Over time, that original product innovation is expanded on, but the market expansion related to improvements on that original innovation are now captured by the lower cost manufacturing countries. Fifth, a cheaper version of the original innovation is manufactured by the lost cost manufacturing countries and sold to later adoption countries which account for a large portion of the total market potential. More longer term profits lost to the origination country. Sixth, Americans end up importing products based on an innovation developed in this country expanding our ever increasing trade deficit. If you don't manufacture things in this country, you can't very well improve on the manufacturing process.

Our government exacerbates the problem with its free trade policies. Free trade policies provide a large economic advantage to countries that have lower costs of living then we have in the United States. As a result, they can manufacturer products much cheaper. The net result is great for myopic management because it maximizes their short term profitability. The policy is terrible for our country because we loose an important source of jobs for Americans. It also puts our advanced technology in the hands of other countries from which it can be subsequently exported to countries that are not our friends.

If you design government policies to serve the goal of maximizing short term profitability, you could preclude the advancement of policies designed to maximize long term goals important to our society. A good example of this concerns our countries failure to develop a long term comprehensive energy policy. A long term goal important to our society is to increase automotive fuel efficiency. But to do that, businesses would have to expend billions of dollars in R&D. So they instead spend hundreds of millions of dollars to pay business lobbyists to influence our representatives look the other way.

It sure seems that recent government policies are clearly more aligned with helping businesses maximize short term profitability to the determent of the long terms needs of our society. Businesses are not necessarily non-congruent with our societies goals, but if a conflict exists, then its necessary to rectify such a conflict in favour of the long term goals of our society.

2008 Dec 22 03:46 PM

[Ray Kenard:]

I am responding to your article questioning why the US economy is in disarray. You noted that the answer is lack of management and policy. My question is why do we lack management and policy? I suggest it is “groupthink”, dumbing down of the content in the press and TV, and therefore the inability to intelligently discus critical issues.

Outstanding things are being done to address tail pipe emission of carbon dioxide in Europe and California. But I have never seen a news article in the NY Times or on TV about such initiatives, even though the public seems to recognize the need to reduce greenhouse gas emissions and petroleum consumption. Let me mention a few initiatives which the public should know about

The National Hydrogen Association has made an extensive study that shows that the only solution to the increasing use of petroleum fuels and the emissions of greenhouse gases is a transportation system based on either electricity or hydrogen. The National Science Foundation has recently reached the same conclusion. The US Department of Transportation believes that the zero-emission transit bus is one of the few near-term opportunities to achieve a major reduction in petroleum fuel use and greenhouse emissions.

California’s ZBUS Initiatives
While some East Coast states are talking about hybrid transit and individual-use vehicles, California and Europe are already focused on the next generation of vehicles – zero-emission vehicles. It is anticipated that California will have 220 zero-emission transit buses by 2012-2014. It already has about 30 hydrogen fueling stations and large-scale facilities are being planned. AC Transit (Oakland) has operated a fleet of three hydrogen fuel cell buses for several years and has ordered nine more. They have reduced the cost of fuel for these three buses by 70% and completely eliminated greenhouse gas emission and other pollutants.

Europe’s Zero-Emission Bus Program
Nine cities in Europe have introduced 30 hydrogen-fueled Daimler fuel cell buses since 2003/2004. As of December 2007, over 7 million passengers have ridden in these buses, and 220 tons of hydrogen has replaced 750,000 litres of diesel fuel. Currently Berlin has 14 hydrogen fueled transit buses, London 10 buses, five cities in the European Hydrogen Alliance have agreed to buy five buses each, Shanghai has 3 buses, and Beijing has 3 buses. Vancouver is acquiring a fleet of 20 such transit vehicles and five fueling station to service its fleet. These 74 buses plus the original 30 buses represents a combined investment of about $400 million tp $500 million plus a comparable amount for the infrastructure to support and fuel the buses.

Recently, the European Union identified a five year $2 billion commitment for sustainable energy projects. Fuel cells and hydrogen systems are the primary focus of this investment.

My company is in the business of creating and developing hydrogen projects in New York State. We were one of two of the first projects to receive State funding. We have just completed a project at the Albany Airport that consists of a hydrogen fueling station and two Prius vehicles and two Silverado pickup trucks that have been converted to fuel hydrogen. We have three colleges interested in hydrogen fuel cell bus projects but don’t have the money for the projects. The State recently outlined a draft Energy Master Plan that did not include any mention of hydrogen. We have made a proposal to the Federal Transit Administration for one project and will make additional proposals if the Obama administration provides funding for such efforts.

Earlier this year we did a study at the request of the staff of a New York City agency for converting waste gases, that were being flared, to energy. An economic appraisal indicated an attractive project. We were then informed that it would be a project scheduled for 2010.

In one of the old POGO comic strips, he said “We have met the enemy and they are us”. We need leadership to lay out the options and to make things happen. I hope Obama will provide that leadership.

2008 Dec 22 04:13 PM

[Michael Fit...:]

hello all. thanks for reading and taking the time to comment. here's the author's comments on the comments....

issac the great: thanks very much.

itsonlymoney: yes, i agree it is on the low side (i want more too) but it is a compromise based on feedback i got from people who
a) are tired of tax increases
b) think there is plenty of oil (right now they are convinced there is...)
c) don't think the government is capable of doing anything intelligent with the revenue
d) think the current economic slump is not the time to raise taxes on people who are already struggling.

but, the thing is to get the policy and program (and mindset) in place. the actual tax could be adjusted later as progress (hopefully) can be seen as a result of this tax. on the nuclear power issue...well, i hate it that i am supporting it. but, if you ever get extremely bored, sit down and figure out the BTU's (or MW, or whatever energy measurement unit you desire) are contained in 15,000,000 barrels of imported oil. a day. and, explain to me how we significantly reduce this importation of energy without 1) much greater use of natural gas and 2) nuclear power. i am going to publish an article on this issue soon.

hello longoil: perhaps i should clarify the hydrogen issue: i am soley advocating hydrogen to be a backup fuel for wind and solar "off weather" periods. in other words, if you have a small local (sustainable) community powered by wind and solar, there will be times when the energy obtained won't be needed. so, it can go to waste, or, we can use electrolysis and generated hydrogen (which can then be stored until later), or, as someone last time suggested (and i again forgot to include it!), a molten salt sub-storage system for regeneration at a later time. my gut tells me the molten salt may be more expensive, but then again hydrogen isn't the easiest thing to store either...so, i need to do some cost analysis on this issue. on your bush/buffet issue, that's funny...the only answer i have is one of those two men wasn't a blue-blood yankee from conneticut born with a gold spoon in his mouth with skull-n-bones initials on it...and one was. sad, but that is how america choses its incompetent leaders.

bob lunn: love your first paragraph..you are a much better writer than i!
your second paragraph is awesome too...and i can add more to your points there...many American technology companies pay their engineers to train engineers overseas. they say the company has policies in place to protect IP. once the engineer in india or singapore or china is trained, he is then more valuable...switches jobs, and low and behold, you have now trained a foreigner that works for another company. wonderful. i know. i used to be an engineer at a company that did this. that company is mentioned in this article. i hate to think of the US trading its addiction to foreign oil to an addiction on foreign batteries...but that is exactly where we are headed at the moment. wrt free trade, it makes the CEO's at multinational companies rich, and that's all those mostly unpatriotic and incompetent bastards care about. wrt the lack of energy policy..you could say Congress is damn near criminal neglect on this issue. pushing it further, you could say it is a treasonous act since lack of an energy policy is in effect funding the foes who are fighting our troops overseas. interesting huh? if obama and team doesn't come through, i for one am going to start writing articles advocating the 50 states call a constitutional convention and start over with the original declaration of independence and bill of rights, and go from there.

ray kenard: definitely agree with dumbing dumb, especially the press and the power elite control of the media (CNBC for example, what a joke). agree with your comment on electrical or hydrogen fueled transportation, but hydrogen seems to be a never ending pipedream and auto batteries aren't there yet. soo, that is why i "bridge" with natural gas. please see my recent article on natural gas technology which has in it the emmission data, which you probably know already considering your response:
seekingalpha.com/artic...
I had no idea about this ZBUS initiative - thanks! good stuff. I am from NY state, so I am glad to hear you are up there working on these things. Honestly, I did not know hydrogen was making such progress...it always seems 5 years away (and has for the last 30 years). you are opening my eyes. Good luck with your iniatives wrt Obama...i too hope the man and his administration come through. thanks for the comments.

2008 Dec 22 10:05 PM

[Ferdinand E...:]

Well, this article and comment are a lot different from the Fitzman who thought that he was going to give me a lesson a few moons ago. He had it mostly right before, but now just about everything is right.

A COMPREHENSIVE ENERGY POLICY IS AN ABSOLUTE MUST! I don't believe however that one can be obtained from the 'energy team' that Senator Obama has chosen, but I could be pleasantly surprised. I'm certainly pleasantly surprised by this article, which does not curse and swear at my good self because of my skepticism where wind and natural gas are concerned. Yes, as much wind and gas as is economical, but no more.

The same concerns all the rest of the renewables and so called renewables, because there are people in this old world of ours - some of whom are very influential - who want renewables regardless of their sub-optimality.

2008 Dec 23 09:19 AM

[john s. gordon:]

motorola suffered for many yrs from inbred management - too many galvins on the board of directors.

when you have accountants running auto companies (roger smith) you end up with bankruptcy. the engineers @ GM know how to build a good automobile but the accountants won't let 'em do it.
> jack

2008 Dec 23 10:01 AM

[wallemac:]

Nice plan. The one problem I have is your limited focus on reducing "oil and oil based energy" rather than fossil fuels in general. You might modify your plan by acknowledging natural gas as a bridge fuel or perhaps coal with carbon capture and storage, but you need to include these along with oil.

Regards,

walle

2008 Dec 23 10:05 AM

[Michael Fit...:]

Banks: the only major additions to this version of my energy policy (versus previously published versions on SA) is:
1) advocating government backed battery research and development
2) specific gasoline tax suggestions.
there were some other minor wording changes, but basically, the policy has been fairly stable for some months (years actually) now, so i am not a bit confused as to why you think it's a new fitzman...same ole fitzman, just fine tuning the policy a bit. glad to know you agree with it, especially since it prioritizes the need to move away from oil and gasoline to nat gas until the renewable infrastructure is built.

gordon: yeah, not just galvins, but managers who got very rich on their stock options (early on), then sat back collecting their salaries and reading the WSJ every day instead of taking risk to get internal technologies monetized. it is criminal to know the technology which motorola had in house (first) which was squandered while other companies figured out ways to make money on it. RIMM and nokia should never have been able to put motorola in the ditch. very poor management, and very poor internal policies. engineers deserve some blame too...the fighting tribes they called them...too concerned about egos than funding the right projects and all fighting for the common good. gawd, i could go on and on about motorola. it's a pretty sad commentary on the state of a good ole american business. well, it used to be american...

2008 Dec 23 10:16 AM

[thmime:]

I was driving the New Jersey turnpike when the speed limit was 55mph. It didn't work. Everything else was good. Forget speed limits.

2008 Dec 23 10:54 AM

[longoil:]

Fitzman,

I understand your storage argument for hydrogen fully.
I think a better destination for unused electricity is the following:

1) If enough PHEVs or electric cars where deployed, storage would be a non-issue. Wind generated electricity is most prevalent at night, when PHEV or electric cars are likely to be plugged in and can capture it.

2) Unused locally generated electricity can also be put back on national grids and sent hundreds or thousands of miles away where it is needed and it can offset coal or NG generated electricity

2008 Dec 23 11:34 AM

[Erich J Knight:]

I wanted to brief you all on Biochar (charcoal) for Carbon soil sequestration.

I thought these updates and endorsements may interest you,

Sen. Ken Salazar (Now Secretary Of Interior!) has done the most to nurse this biofuels system in his Biochar provisions in the 07 & 08 farm bill,
www.biochar-internatio......

Below are my current news & Links to major developments;

At USDA Dr.Jeffrey Novak is coordinating Biochar research.
I've had productive contacts with Douglas Lawrence, director NSCS & Farm bill coordinator, and through him, David Douds with ARS for MYC & VAM Fungi research, and Chris Nichols ARS glomalin research.

My other most successful efforts to date are continuing briefings to Michael Pollan (Food Column NYTs & author) over the last year.

In a recent National Public Radio interview, Michael Pollan talks about how he was approached by a Democratic party staffer about his New York Times article, The "Farmer & Chief" article is an open letter to the next president concerning U.S. agriculture/energy policy. The staffer wanted Pollan to summarize the article into a page or two to get it into the hands of Barack Obama. Pollan declined, saying that if he could have said everything that needed to be said in two pages, he wouldn't have written 8000 words.
Michael Pollan is well briefed and excited about Biochar technology, but did not include it in his "Farmer & Chief" article to President Obama, (Which he did read & cited in a speech) but I'm sure Biochar will be his 8001th word to him.

Changing World Technologies

Ultimately we must leave the combustion age behind. Charcoal to the soil is a bridging first step as other energy conversion technologies bloom from Nano and bio research . Thankfully we can do Terra Preta (TP) soil with off the shelf technology now.

Oil companies must come to see the overwhelming value of their fossil carbon as the best feedstock for the manufacture ( via carbon nanotubes, fullerines, DNA programed nano self assembly, etc.) of virtually all things in the near future.

This convergences of different technologies will end the Combustion age.

TP starts as a soil nano technology with increased CEC, than a micro technology with our wee- beasties / fungus, and macro with bugs and worms.

Biochar, the modern version of an ancient Amazonian agricultural practice called Terra Preta (black earth), is gaining widespread credibility as a way to address world hunger, climate change, rural poverty, deforestation, and energy shortages… SIMULTANEOUSLY!

Modern Pyrolysis of biomass is a process for Carbon Negative Bio fuels, massive Carbon sequestration,10X Lower Methane & N2O soil emissions, and 3X Fertility Too.
Every 1 ton of Biomass yields 1/3 ton Charcoal for soil Sequestration, Bio-Gas & Bio-oil fuels, so is a totally virtuous, carbon negative energy cycle.

Charles Mann ("1491") in the Sept. National Geographic has a wonderful soils article which places Terra Preta / Biochar soils center stage.

Please put this (soil) bug in your colleague's ears. These issues need to gain traction among all the various disciplines who have an iron in this fire.

The NGM cover reads "WHERE FOOD BEGINS"
ngm.nationalgeographic...

It's what Mann hasn't covered that I thought should interest you and Sen. Salazar;

NASA's Dr. James Hansen Global warming solutions paper and letter to the G-8 conference, placing Biochar / Land management the central technology for carbon negative energy systems.
arxiv.org/ftp/arxiv/pa...

The many new university programs & field studies, in temperate soils; Cornell, ISU, U of H, U of GA, Virginia Tech, JMU, New Zealand, Germany and Australia.

Biochar data base;
terrapreta.bioenergyli...

Glomalin's role in soil tilth, fertility & basis for the soil food web in Terra Preta soils.

POZNAN, Poland, December 10, 2008 - The International Biochar Initiative (IBI) announces that the United Nations Convention to Combat Desertification (UNCCD) has submitted a proposal to include biochar as a mitigation and adaptation technology to be considered in the post-2012-Copenhagen agenda of the UN Framework Convention on Climate Change (UNFCCC). A copy of the proposal is posted on the IBI website at
The International Biochar Initiative (IBI).

Given the current "Crisis" atmosphere concerning energy, soil sustainability, food vs. Biofuels, and Climate Change what other subject addresses them all?

This is a Nano technology for the soil that represents the most comprehensive, low cost, and productive approach to long term stewardship and sustainability.

Carbon to the Soil, the only ubiquitous and economic place to put it.

If pre-Colombian Kayopo Indians could produce these soils up to 6 feet deep over 15% of the Amazon basin using "Slash & CHAR" verses "Slash & Burn", it seems that our energy and agricultural industries could also product them at scale.

Harnessing the work of this vast number of microbes and fungi changes the whole equation of energy return over energy input (EROEI) for food and Bio fuels. I see this as the only sustainable agricultural strategy if we no longer have cheap fossil fuels for fertilizer.

We need this super community of wee-beasties to work in concert with us by populating them into their proper Soil horizon Carbon Condos.



Total CO2 Equivalence:
Once a commercial bagged soil amendment product, every suburban household can do it,
The label can tell them of their contribution, a 40# bag = 150# CO2 = 160 bags / year to cover my personal CO2 emissions. ( 20,000 #/yr , 1/2 Average )
www.epa.gov/climatecha...

But that is just the Carbon!
I have yet to find a total CO2 equivalent number taking consideration against some average field N2O & CH4 emissions. The New Zealand work shows 10X reductions. As biochar proves to be effective at reducing nutrient run-off from agricultural soils, then there will accordingly be a reduction in downstream N2O emissions.

This ACS study implicates soil structure as main connection to N2O soil emissions;
a-c-s.confex.com/crops...

Biochar Studies at ACS Huston meeting;

578-I: a-c-s.confex.com/crops...

579-II a-c-s.confex.com/crops...

665 - III. a-c-s.confex.com/crops...

666-IV a-c-s.confex.com/crops...

Most all this work corroborates char soil dynamics we have seen so far . The soil GHG emissions work showing increased CO2 , also speculates that this CO2 has to get through the hungry plants above before becoming a GHG.
The SOM, MYC& Microbes, N2O (soil structure), CH4 , nutrient holding , Nitrogen shock, humic compound conditioning, absorbing of herbicides all pretty much what we expected to hear.

Company News & EU Certification

Below is an important hurtle that 3R AGROCARBON has overcome in certification in the EU. Given that their standards are set much higher than even organic certification in the US, this work should smooth any bureaucratic hurtles we may face.

EU Permit Authority - 4 years tests
Subject: Fwd: [biochar] Re: GOOD NEWS: EU Permit Authority - 4 years tests successfully completed

Doses: 400 kg / ha – 1000 kg / ha at different horticultural cultivars

Plant height Increase 141 % versus control
Picking yield Increase 630 % versus control
Picking fruit Increase 650 % versus control
Total yield Increase 202 % versus control
Total piece of fruit Increase 171 % versus control
Fruit weight Increase 118 % versus control

There is list of the additional beneficial effects of the 3R FORMULATED BIOCHAREU DOSSIER for permit administration and summary of the results from 4 different Authorities who executed different test programme is under construction
I suggest these independent and accredited EU relevant Authority permit field tests results will support the further development of the biochar application systems on international level, and providing case evidence, that properly made and formulated (plant and/or animal biomass based) biochars can meet the modern environmental - agricultural - human health inspection standards and norm, while supporting the knowledge based economical development.

We work further on to expand not only in the EU but in the USA as well. My Cincinnati large scale carbonization project is progressing, hopefully the first industrial scale 3R clean coal - carbon plant will be ready in 2009.

Sincerely yours: Edward Someus (environmental engineer)
HOMEPAGE 3R AGROCARBON: www.3ragrocarbon.com

www.terrenum.net
EMAIL 1: [e-mail]

2008 Dec 23 11:41 AM

[fran:]

FITZ--

one item atop all others--

STOP REWARDING FAILURE:

as parents
as schools
as business
as government
as electorate
as individuals

RECOGNIZE FAILURE AS PART OF OUR LEARNING PROCESS AND CLEANSING PROCESS. RECOGNIZE THAT PAIN/SUFFERING ARE PART OF LIFE.

2008 Dec 23 11:57 AM

[Ferdinand E...:]

Confused, are you Fitzman? Well, as the leading academic energy economist in the world, I stay away from confusion. It's a very bad condition and it wears a fellow down in the end, especially if you leave the blogosphere and take your confusion into a seminar room or conference, and find yourself facing a brilliant academic energy economist. I won't say who I have in mind, but his initials are F as in Ferdinand, and B as in Banks.

The bottom line in your work is this business about a strategic comprehensive energy policy. It was expressed better in the above contribution than before. As for this making a big thing of natural gas, well, rather than discuss that in detail, let me say that if you still remember your college algebra - which, incidentally, I failed twice and was probably the main reason for my being expelled from engineering school after my first year, although the Dean pronounced me as generally hopeless - I think that you would be able to see just what and all-out bet on gas would mean. I hope however that you don't make a big thing of my being expelled from engineering school, because I was first in my class at infantry leadership school, but was expelled on the last day anyway.

Do you follow my argument?

2008 Dec 23 12:46 PM

[nakedjaybird:]

Like I've said before, most decent housewives can manage better than what we call executives running both industry and government - and the wives don't even demand a salary, much less a bonus, etc. They do their job; WHAT OUR LEADERSHIP BASICALLY DOES NOT DO.

There appears to be little accountability (and don't even mention personal, because that's private [Myth 69]); and what's most sickening, little responsibility [Greed Truth 101].

Kudlow and the rest of them stating broadly that we need to pay lots to get the best have their heads where the sun does not shine.

We do not need to pay stars extra for performance. They have been stars their whole life and rose to the top faster than most following the general pay curves for most positionsl. They happen to be young managers at the top - and that's all the job is worth: 20% above the next lower pay grade which should be less than $200,000/yr. If they do well, they get their pay (only) because that's their job.

If they think they are worth more, then they should go out and start their own business.

2008 Dec 23 01:22 PM

[SubsidyEye:]

Michael Fitzsimmons, I like a large number of your recommendations, particularly the ending of mandates and subsidies for corn ethanol, and of the import tariff on Brazilian ethanol, and in general your stress on conservation.

I agree that an increase in the federal gasoline excise tax is in order. But let's not dress it up as an “energy freedom tax”, which aspires to an unrealistic goal, and smacks of jingoism. How about starting with a genuine carbon tax? A tax on gasoline of $50 per metric tonne of CO2-equivalent, which is a common reference value and equal to the highest price so far for a carbon offset traded on the European Carbon Eschange, would translate to about $0.50 per gallon. Personally, I would advocate beginning at $0.10/gallon in 2009 an increasing it by $0.04/gallon every year for the next 10 years.

Earmarking the revenue to a fund to invest in your chosen technologies, however, is bad policy. As energy czar, you might allocate it *only* toward building the natural gas, nuclear, and electrical infrastructures. I might choose something else. In either case, there is virtually zero chance that the revenues generated would exactly equal the optimum amount that the government should spend in these areas. Better policy would be to use the revenues to reduce income taxes, and to invest in any particular technology or other program on the basis of its own merits, not according to what money ends up in your hypothecated fund.

2008 Dec 24 03:24 AM

[Michael Fit...:]

wallemac: not sure i understand what your beef is...my energy policy relies heavily on using natural gas as a bridge to alternative energy infrastructure, and i did say so in the article. wrt coal carbon capture and sequesturing...i don't believe in it. no one yet has been able to explain how carbon gets pumped into the earth. perhaps i don't understand the technology, but my gut tells me it is a pipedream.

thmime: well, speed limits work as far as increasing fuel efficiency. some people will obey the limits, so it would help. it helped when carter was president, and i think it will help now. this summer, when gasoline and deisel were sky high, transport truckers were driving slower all on their own. in the long run, as gasoline prices reach for the sky again, people will be driving slow on their own as well. again, we can sacrifice now, or sacrifice later. but make no mistake, the reality of peak oil and worldwide oil supply demand, we will be sacrificing..whether we want to or not...

longoil: well, first of all, local sustainability wouldn't want to send their energy somewhere else, they'd want to keep it local for when they need it (thus the storage). secondly, the electrical grid is not a storage mechanism, the electricity must be used real time or is lost. that is why there are times when energy from solar or wind above and beyond current use needs to be stored. the switching of coal/nat gas/nuclear etc. etc when wind and solar generation goes up and down is not an instantaneous process...it takes time, and it also is not on a MW to MW basis, there has to be margin so that it is guaranteed that demand is met. therefore, there are simply times when the total power from solar and wind will not be used, and could be stored.

erich: not sure i understood...perhaps you could focus simply on carbon sequestration and explain to me how it works (take a coal plant as an example). i have my doubts, but perhaps you could educate me.

fran: um, ok, i don't agree with rewarding failure....

ferdinand: i was only confused wrt your comment, as i said before, the energy policy has been tweaked very little. as far as you being the "leading energy economist" in the world, and not being a proponent of US natural gas, well, i have my doubts. do i follow your argument, honestly, no, i seldom do.

SubsidyEye: thanks for the compliments. on "energy freedom tax", it seems your interpretation was that i think the US can be energy independent. i do not, and perhaps i should have clarified that point. the US will be importing oil as long as there is oil to import. perhaps i should have chosen "US oil import reduction tax" or some such. i don't have a problem with your $0.10/gallon increased by $0.04/gallon every year. again, the important thing is the policy and an acknowledgement over what the policy's strategy is. the numbers can be tweaked as times and circumstances dictate. as far as earmarking the funds, taxing gasoline and giving it to the "government" to do something without specifying, i am against that. the whole point here is to reduce foreign oil. our government has already proved they can't do that, in fact they have proved their policies INCREASE our foreign oil importation. so, yeah, i want to have control of that money, and i want to use it to buildout the natural gas, nuclear, wind, and solar infrastructure. reducing income taxes...we've had 8 years of that...and it is a failure. people save 5% on their income taxes and then lose 10 times more than that in the stock market they invest in and as the US dollar loses its value as we go into debt. reducing income taxes while the government is fighting two wars and the debt zooms every skyward is simply a quicker way to put the US into bankruptcy. even warren buffet admits bush's tax policies were a huge mistake for the country, and he benefitted more than anyone (in terms of taxes). then again, buffet is a patriot, and bush is not (imho).

2008 Dec 24 09:03 AM

[SubsidyEye:]

Michael, you wite that "as far as earmarking the funds, taxing gasoline and giving it to the "government" to do something without specifying, I am against that", essentially because you believe the government does a poor job of picking winners. I agree. But then you suggest hypothecating the funds ... so that you can pick winner!

The whole point of a carbon tax is to get the government OUT of picking winners!

You seem to have missed my point about income tax also. I am not necessarily any particular level of government revenues. What I am suggesting, however, is that the revenues could be offset, one-for-one (or some other ratio) by an overall reduction in income tax, which would encourage employment and initiative. By citing the policies of the past 8 years, you are essentially complaining about HOW the tax cuts were implemented, and the fact that Congress and the Administration allowed deficit spending. We are talking about different things. I am talking about increasing the share of the carbon tax in overall government revenues (whatever those should be); you are talking about a need to tax more. Different points.

2008 Dec 24 09:22 AM

[Old Wizard:]

Fitz, As I've said before, we are mostly on the same page on the comprehensive energy plan and that the decrease of foreign oil imports, especially from hostile suppliers should be top priority. I think our politicians don't realize that they can solve a good part of our economic woes, create jobs, solve a serious strategic problem and do the environmen t some good through this comprehensive plan. The media is a lost cause and the respective pressure groups will never fight for any comprehensine plan. I would add to your list specific targets for less oil imports in time and my favorite monorail spiders instead of more roads in metro plex areas. The only way to get started is to enable several large scale pilot projects. As I suggested before, 200 to 250b should be allocated to these instead of the Christmas tree infra structure programs that the politicians and states are pushing. I think a few of us folks could define the plan and how to implement it and I wish that we had the ball. Aside from that. I want to wish all happy holidays, Merry Christmas or whatever is your specific holiday and May your New Year be filled with joyful surprises.

2008 Dec 24 03:56 PM

[User 283977:]

One of the headlines in the recent news is that beause of the drop in gas prices, Americans are saving $1b per day. What a concept... $1b per day more money staying in our country.

2008 Dec 29 11:12 AM