Lesson Objectives:- Energy independence
- Politics of oil prices
- Energy-related disasters
- Climate change
- Legislation and controversy
The U.S. requires a lot of oil and the top exporters of oil in the world are not our friends. Russia is the second largest, after Saudi Arabia. Venezuela and Iran are among the major exporters who are openly hostile to us. It is obvious that moving toward energy independence is a necessary goal and as of 2016, America was down to importing only about 21% of the oil we need. What made that happen?
It goes without saying that if the value of a commodity rises, the manufacturers have a great reason to make more of it. As gas prices shot up to over $4 for the first time in history, gas companies were rushing to make more. The question was, could they extract more crude oil?
Hydraulic fracturing or fracking is the injection of a high-pressure solution of water, sand, and chemicals into hydrocarbon-bearing rocks, releasing oil or natural gas. Fracking has created an interesting situation. Years ago, it seemed that importing natural gas was inevitable, but fracking made it possible to extract so much natural gas that we ran out of storage. With natural gas prices going down and the price of coal going up due to new air-pollution regulations, the coal industry took a hit. Fracking is highly criticized by environmental activists but it continues to grow as a resource.
When presidents claim to be able to lower gas prices, there actually is little they can do since the cost of crude oil is set worldwide. But, fracking has had an effect on the crude oil market and in 2014, the cost per barrel of crude oil dropped from $100 to $50. That drove the cost of gas back to $2.50 per gallon by the end of 2015, making the United States the "swing producer" determining oil prices instead of Saudi Arabia.
With President Obama putting high fuel-efficiency standards in place and government subsidizing of the development of alternative fuels, the shift toward energy independence is coming closer within reach. The use of windmills and solar panels have increased as the cost of using those resources have gone down.
While Republicans have been pushing for opening new areas for drilling and Democrats have been reluctant, President Obama opened major new offshore tracts in the Atlantic. Not even a month later, an oil spill disaster in the Gulf of Mexico became the largest in American history, the BP Deepwater Horizon oil spill.
President Obama also thought nuclear plants was a viable solution and several plants were in the planning. That idea was immediately shelved in 2011 when a tsunami struck northeast Japan and damaged several nuclear reactors. The resulting radiation leaks changed a lot of people's minds about the safety of nuclear power.
The term "climate change" came into wide use in the 1990s when scientists started trying to get people to understand that our own human activity was causing a problem. Accumulation of greenhouse gases in the atmosphere would produce a "greenhouse effect" and result in temperatures slowly rising because these gases, especially carbon dioxide, have the ability to trap heat.
Many scientists agree that temperatures will rise, but they cannot agree on how much. Environmental activists are calling for solutions.
The problem is that many people, especially Republicans, are not convinced that climate change is an issue, and even less believe that climate change is a result of human activity instead of normal, cyclical climate changes such as those that have occurred throughout Earth’s history. Democrats have been able to pass some environmental laws like legislation limiting the emissions of CO2 and other greenhouse gases.
The Supreme Court blocked some legislation that President Obama had put in place to regulate greenhouse gas emissions, but certain states like California and Massachusetts have taken up that effort themselves.
In addition, individuals and companies have made changes. One example is how new power plants have started using natural gas instead of coal. Driving fuel-efficient cars is another example, and these things have contributed to the significant decrease in CO2 emissions.
Of course, the conversion of power plants to natural gas was not all entirely self-enforced. The EPA had something to do with it when the Supreme Court ruled that it had the authority to regulate the emission of CO2. This decision led to a series of changes that gave companies options, but put the future of coal into serious question.
The Keystone XL pipeline caused more controversy. In an attempt to carry petroleum from the Alberta oil sands and North Dakota to refineries on the Gulf Coast, the pipeline was put in place. Opponents argued that the oil was pollution intense and worried about spills. Proponents argued that there were far greater economic benefits.
The pipeline cleared its last hurdle, getting the go-ahead from the Nebraska Public Service Commission. But, an oil spill in November of 2017 in South Dakota has created uncertainty about the whole project.