20080823
What’s Pickens up to?
T. Boone Pickens has been very active recently. You have probably seen his first series of commercials publicizing his plans (actually his actions) to promptly get the US off of its oil habit addiction. Many of you, myself included, noticed this, but paid little attention to his initial round of ads. He was recently promoting his plan in Las Vegas at a democratic conference. While this news was making its way off of front page news circles, a coworker emailed me an outline of his plan. While reading it the essence of the plan hit me. Yes, the initial series of infomercials touting the widespread availability and value of wind power are what you may be familiar with. The real genius of the plan is that it advocates the use of natural gas in transportation systems to bridge the gap leading up to technological demonstrations of alternatives like biofuel, electric cars, … . It took a while before the full impact of the plan sunk in. The key to any alternative energy source is the time it takes to be adopted and penetrate the market. One of the longest lived infrastructures are buildings (homes and commercial real estate have lifetimes in excess of 50 years). Automobiles, trucks, planes, and trains are a close second at 8-20 years. Pickens’ plan advocates the conversion of the transportation infrastructure from oil to natural gas. Aside from the cleanliness of natural gas relative to oil, the brilliance of this plan lies in the fact that existing vehicles can be converted from oil to natural gas at a minimal cost (relative to the cost of total replacement with hybrids or electrics – not to mention the infrastructure costs). I have had the opportunity to drive dual fuel vehicles that ran on both natural gas and gasoline. There is essentially no difference in convenience or performance. Imagine a tax on gasoline that funds a tax credit that offsets the cost of converting an existing gasoline/diesel vehicle over to natural gas. Both the increased cost of gas along with the rebate to offset the cost of conversion would quickly move us from oil to natural gas for our transportation needs. The US natural gas resources would create internal wealth, decrease significantly our trade deficit, and turn an unstable part of the world into something less important than it currently is. This is just a bridge to our new undefined energy future. It buys us time. It creates jobs and wealth within the US. By reducing our trade deficit, it gives us the capital to develop and deploy the long-lived solutions that are still in development. This is exciting and I am impressed with the plan. Let’s hope the message can be well formulated and spread widely.
Hooda Thunkit said,
August 23, 2008 @ 1952
Joe,
My thoughts are interspersed.
”He was recently promoting his plan in Las Vegas at a democratic conference.”
No surprise here… Bit I wonder how an Oil Man” would do pitching this plan to a group of Republicans? One would expect he’d do very well.
” While this news was making its way off of front page news circles, a coworker emailed me an outline of his plan.”
Read the plan and it is excellent, as far as it goes, but more on that later…
”While reading it the essence of the plan hit me. Yes, the initial series of infomercials touting the widespread availability and value of wind power are what you may be familiar with. The real genius of the plan is that it advocates the use of natural gas in transportation systems to bridge the gap leading up to technological demonstrations of alternatives like biofuel, electric cars, … .”
As I’ve said before, BURNING fuel for transportation should never be the goal, electrics (pending viable transporter systems) is.
” It took a while before the full impact of the plan sunk in. The key to any alternative energy source is the time it takes to be adopted and penetrate the market. One of the longest lived infrastructures are buildings (homes and commercial real estate have lifetimes in excess of 50 years). Automobiles, trucks, planes, and trains are a close second at 8-20 years. Pickens’ plan advocates the conversion of the transportation infrastructure from oil to natural gas. Aside from the cleanliness of natural gas relative to oil, the brilliance of this plan lies in the fact that existing vehicles can be converted from oil to natural gas at a minimal cost (relative to the cost of total replacement with hybrids or electrics – not to mention the infrastructure costs).”
Yes, this IS a better plan, however the infrastructure will tend to lag almost until total conversion has been completed, unless there is an incentive/inducement to do so both early and quickly.
”Imagine a tax on gasoline that funds a tax credit that offsets the cost of converting an existing gasoline/diesel vehicle over to natural gas. Both the increased cost of gas along with the rebate to offset the cost of conversion would quickly move us from oil to natural gas for our transportation needs.”
Yes, but that is another “shudder” tax, and that spells yet another burden on those least able to afford it. Better, IMNHO, would be to suspend the taxes on the LNG to encourage the changeover; not your punitive suggestion. Besides, eliminating a tax would be a great way to either prove or disprove the debate on taxes in general, and may the bes way prove itself.
”The US natural gas resources would create internal wealth, decrease significantly our trade deficit, and turn an unstable part of the world into something less important than it currently is. This is just a bridge to our new undefined energy future. It buys us time. It creates jobs and wealth within the US. By reducing our trade deficit, it gives us the capital to develop and deploy the long-lived solutions that are still in development. This is exciting and I am impressed with the plan.”
On this we agree, no more need be said. . .
Except that the best interests of this country (and a modest profit) seem to be in Pickens’ heart/mind…, but not necessarily in that order
Hooda Thunkit said,
August 23, 2008 @ 1954
Better, but not completely right.
Have you ever felt the need to preview, before submitting an entry to posting?
I have. . .
JMZ said,
August 24, 2008 @ 0323
Hooda,
I deleted the first post and then edited the second (replaced a bold with a italic near the end).
The point of this is that there are a number of things we could to TODAY to get us going in the right direction. I agree that burning anything fossil is a bad idea for moving us/things around the planet, but nat gas is better than oil. This is a temporary plan, a first step, it is not the solution, it just buys us some time. We need time too. Things are changing faster than anyone anticipated.
Most people think with their wallet and taxes are a very effective way to motivate adoption of a new policy. Rather than shoot at the idea, offer a better one. Both oil/gasoline and natural gas should be subject to a carbon tax in addition to my gas tax to fund the conversion to nat gas vehicles. I was very happy to hear that the amount of driving we did as a nation dropped by 5% when gas hit $4/gallon. I think gas should cost twice that.
When I get to work Monday I’m going to look into using nat gas to fly aircraft. If it needs to be LPG then I think the safety aspect will rule it out.
Hooda Thunkit said,
August 24, 2008 @ 1349
Joe,
“Most people think with their wallet and taxes are a very effective way to motivate adoption of a new policy. Rather than shoot at the idea, offer a better one. Both oil/gasoline and natural gas should be subject to a carbon tax in addition to my gas tax to fund the conversion to nat gas vehicles. I was very happy to hear that the amount of driving we did as a nation dropped by 5% when gas hit $4/gallon. I think gas should cost twice that.”
I’m not one who thinks that the answer to everything is increasing taxes.
As for offering a better solution, I already did.
As far as using LNG to power jets, I would think that new engines would be involved and new fuel tanks would have to be designed.
Better would be starting over from scratch, which would significantly boost the manufacturing sector.
Agreed on the LPG issue, although, as long as we’re re-desigining the jet, why not throw LPG and LNG both into the equation?
JMZ said,
August 24, 2008 @ 1406
I’ve started to look into what it takes to switch an older vehicle over to nat gas. I found this information which some may find useful. I think the biggest drawback is the reduced range, however, I was also considering plug-in electrics (not hybrids) which rarely give more than 100 miles per charge. It would be nice to be able to fill the nat gas tank at home which you can do over night.
JMZ said,
August 24, 2008 @ 1417
Hooda,
I’m not a big fan of taxes myself, but they are the only tool the government has which still allows market forces to determine the final outcome. As for the carbon tax, I read somewhere that if gasoline prices included the cost of its carbon impact on society, the cost of gasoline would be between $12 and $15 per gallon. All I am saying is that if gasoline cost that much we would all be driving very different vehicles. We need to change our ways quickly and government needs to prod us all along in the right directions with the few effective tools it has available. We can’t wait for either the disbelievers to ’see the light’ (or is it smell the smoke?) about climate change and our role in it nor for the consumer to decide on their own that it is time to do their share of implementing solutions (like buying a new car).
Hooda Thunkit said,
August 24, 2008 @ 1454
Joe,
What you say is true, but I believe that it is government that upsets and retards the Free Market forces now.
After all, the main purpose of government these days, is expansion and growth (of government) and, to my thinking, this is not good.
Small “l” Libertarianism is right on this one…