US government responses to two major crude-oil supply interruptions in the 1970s may appear to generally have created more problems than they solved, speakers at a Resources for the Future (RFF) forum said. But several also laid the framework for potentially more rational responses in a public atmosphere that possibly could become better informed and more rational, they added.
“The stories I share about the past provide cautionary tales for the future,” said Meg Jacobs, the Oct. 5 event’s main speaker who wrote “Panic at the Pump: The Energy Crisis & the Transformation of American Politics in the 1970s.”
“The average American citizen uses two times the amount of fossil fuel as someone who lives in Great Britain. Although cars are becoming more efficient, Americans are driving bigger models more frequently and across greater distances,” Jacobs said. “Telling them that they still need to cut back is politically difficult. Even when people want to fix local problems such as high emissions that come with health risks, they generally don’t want to address global warming.”
Public skepticism of the government’s ability to keep energy plentiful and inexpensive possibly could be the greatest legacy of those 1970s efforts, Jacobs said. US consumers reached another crossroads by 2015 when it became obvious that hydraulic fracturing and horizontal drilling had made so many previously inaccessible oil and gas resources available that prices plunged, she noted.
“The difference now is that instead of telling consumers they need to be prepared to use less and pay more, government leaders can urge them to go green,” Jacobs said. “People in the US got more new jobs in solar and renewable energy in 2015 than in coal. The hardest challenge in Paris and America now is overcoming the sense that governments can’t be trusted to fix energy problems.”
Getting more people to think governments can be effective may help the US not make the same mistakes it did 4 decades ago and start to change the way people use energy, she said.
Successes among failures
Direct federal support of energy research and development, which began following World War II with the Atomic Energy Commission’s creation, moved into high gear during the 1970s with new R&D efforts in three more areas, another speaker said.
It eventually became apparent that funding early-stage R&D produced better results than directly supporting a project which used a fledgling technology, said Jan Mares, an RFF senior advisor whose extensive federal service included being an assistant secretary in three different parts of the US Department of Energy in its early days.
“DOE has funded a lot of basic and applied research since its creation in 1978,” Mares said. “For about 37 years, from 1978 to 2015, it funded a total of $256 billion of R&D in 2016 dollars of basic applied research. The Office of Fossil Energy, which is one of four R&D offices at DOE, funded about $35 billion of that.” The National Research Council studied those programs and found that their benefits exceeded their costs, Mares said.
Forming the Synthetic Fuels Corp., which built a coal gasification plant to help offset falling US natural gas production, did not work out well, Mares noted. “We quickly learned that any organization which is funded by an administration and Congress needs to be reviewed frequently so that compensation, for example, doesn’t get out of line,” he said.
“The energy R&D money we have spent in part because of programs begun when [US] President [Jimmy] Carter was in the White House has been a huge success,” he said.
‘A steadily growing movement’
Public environmental awareness also increased the periodic 1970s energy crises, a third speaker said. “A steadily growing environmental movement reflected the tension between pressures to increase economic growth and increasing signs of environmental problems,” said Joel Darmstadter, an RFF senior fellow whose research has addressed energy security, renewable and unconventional fuels, and climate change during his 4 decades there.
It began to grow earlier, with the 1962 publication of Rachel Carson’s “Silent Spring,” which eventually led to passage and adoption of the National Environmental Policy Act about 8 years later, he said. Another book, “The Limits of Growth,” in 1972 was one of the first to raise questions about potential economic and societal consequences worldwide once finite resources begin to run out.
“All this gave environmental interests an opening to press their concerns amid the 1970s energy turmoil,” Darmstadter said. Increasing US oil demand helped many groups and advocates like Amory Lovins make a case for substantially improving energy utilization. The physical exhaustion of resources as outlined in Limits to Growth looked too perilous to ignore. The debate about peak oil and other resource limit movements also emerged.”
The 1970s energy security vision was almost entirely oil-centered, which another speaker considered a policy failure. The US looks more secure today thanks to unconventional oil and gas exploration and production techniques, said Alan J. Krupnick, a senior fellow and co-director of RFF’s Center for Energy and Climate Economics. While the Organization of Petroleum Exporting Countries may try to restrict its members’ production to raise prices, it does not want to let them rise so far that they stimulate tight oil production and development of alternatives, he said.
“Partly because of this as well as other developments in the world, we’re starting to think about a new energy paradigm,” Krupnick said. “This new definition, first of all, includes electricity not in terms of imports but in terms of reliability. We want diverse and reliable supplies. We want resilience, both to weather as well as to natural disasters and terrorism. And we want a small environmental footprint. We want our energy to be clean, not only from greenhouse gases but also from more conventional pollutants.”
More frequent severe storms and other weather disasters led to the “keep-it-in-the-ground” and other extreme movements that Krupnick said could backfire environmentally if they succeed. “More natural gas pipelines could displace coal around the world. If we could do that, we would make significant progress in improving the global environment,” he said.
Contact Nick Snow at [email protected].
