Thursday, March 17, 2011

America's Way Screwed Up Energy Policy

My MBA degree is from the School of Hard Knocks, not Wharton, but I still understand what drives energy policy in the U.S. It's about making the most money at the least cost, environmental concerns be damned, which goes a long way toward explaining why there was not about to be a resurgence in nuclear power plant construction before the catastrophe in Japan.

The current energy darling is extracting oil from shale, known as fracking. Drilling into shale fields for black gold costs a fraction of the construction of a single new nuclear power plant, or even a few offshore oil drilling rigs.

This, of course, does not take into account that fracking is an environmental disaster waiting to happen, as has repeatedly been the case with offshore drilling, because of lax to nonexistent regulation and the dangers inherent in the wastes and runoff from the fracking process.

In Pennsylvania, which has a new conservative Republican governor who was bankrolled by frackers and a new environmental chief who unashamedly says that economic concerns and not the environment comes first, water supplies are being jeopardized, and the way is being cleared to frack in state forests and parks.

You will hear much talk in coming days of the dangers inherent in nuclear power plants, and while the crippled reactors at Fukushima Daiichi in Japan are of an obsolete design and spent fuel rods are stored alongside one of the reactors, contemporary designs are considerably safer.

The real villain in America's energy lollapalooza is . . . surprise! Congress, which has effectively tied U.S. energy policy in knots by:

* Refusing to support meaningful taxes on carbon emissions and other discharges.

* The vicious cycle of telling regulatory agencies to lay off drillers, refiners and other power generators until there is a crisis like the BP Deepwater Horizon catastrophe in the Gulf of Mexico when it then asks the agencies why they haven't been doing their jobs.

Truth of the matter is, the U.S. has never had a long-term energy policy, let alone a semblance of energy independence. President Obama's energy plan, the only part of his five-part domestic agenda that has not become law, rests substantially on expanding nuclear power, and my School of Hard Knocks training tells me it is likely to stay that way.

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