NO NEW GASOLINE-POWERED VEHICLES IN THE U.S. BY 2014...Can It Be Done?
By Marc J. Rauch, Exec. Vice President/Co-Publisher
Originally Published on The Auto Channel June 23, 2008
The world seems to be in the midst of an energy crisis, fueled (if you’ll pardon the pun) by issues related to petroleum oil and gasoline. Among the consequences of these issues are soaring prices of other consumer products and services; limited freedom of personal movement; erosion of individual wealth; funding of global terrorism; and the grand daddy of all oil/gasoline consequences, pollution.
Can it be done? Can it be done quickly and without the creation of even more drastic consequences to consumer product pricing, personal freedoms, individual wealth, societal safety and the environment?
I’ve initiated a multi-part investigation to determine if and how we could accomplish this herculean feat. In a concurrent article published on The Auto Channel, I am also presenting Part 1 of the series. You can find that piece by CLICKING HERE. But before you click over, please continue with this introduction.
My partner, Bob Gordon, and I have often mused that to solve the seeming energy crisis we need a government mandate equivalent to the Manhattan Project or Kennedy’s effort to land a man on the moon. Although a unanimous government mandate may not be necessary to accomplish the task (maybe a spontaneous unanimous popular movement could erupt), the assistance would be most helpful in order to overcome the myriad legal and licensing requirements that are sure to arise.
So as not to appear too pollyanna-ish, I do want you to know that I have taken into consideration the financial devastation to the existing oil/gasoline industry (and its collateral distribution and retail components) that would result from the elimination of gasoline. This is why my premise proposes the idea of the elimination of NEW gasoline-powered vehicles by 2014, and not the total elimination of all gasoline-powered vehicles and machinery by 2014. Simply put, with the base of existing gasoline-powered vehicles and stationary machinery that now exists, the oil/gasoline industry will continue to thrive in the United States for at least a couple of decades. In the meantime, those oil/gasoline producing companies that wish to would turn their efforts to seriously producing alternative fuels; and the associated industry components would adapt to distributing and selling the alternative fuels. As for those companies and individuals that do not want to adapt to the new alternative fuel, they would go the way of the buggy whip industry or just do business with other nations that continue to rely on gasoline.
THE UNDERLYING ISSUE
In referring to the gasoline crisis I say “seem” because there is evidence to suggest that the high cost of gasoline at the pump is nothing more than the contrived gasoline-shortage-scare of the 1970s. Case in point: last year, when the barrel price of oil was in the $60 range, gasoline at the pump in the U.S. was in the low to mid $3 per gallon. Today, oil is running around $130 per barrel, yet gasoline is “only” low to mid $4 per gallon. Why isn’t the price $6 or $7 per gallon, or better yet why wasn’t the price last year in the $2 range?
While I understand the arithmetic tied to the issues of “oil lifting,” production and refinement facilities, and increased world demand for petroleum and gasoline, I believe the real culprits behind today’s pump price are commodity speculators, OPEC, and the oil companies.
It’s said that it costs the Saudis and others about $2 to “lift” a barrel of oil. There’s a wide gap between $2 and $130. It would be one thing if the $130 per barrel price included all the eventual shipping, refining, and marketing costs related to taking the oil from underground and then transforming it from its raw state to the product you pump into your vehicle, but it doesn’t. Those costs are additional. Therefore, the $130 price is not predicated on arcane consumer supply & demand economic theories. It’s because of greed.
By the way, I pretty much discount the notion that the world is running out of oil; that ain’t happening in my (or Al Gore’s) lifetime, and it probably won’t happen in my grandchildren’s lifetime, if I had grandchildren.
Moreover, if you realize that the price of gasoline has only risen in concert with prices of most other items such as milk and bread and a slice of pizza, a great case could be made for saying that all the news about oil production and gasoline prices is nothing more than overly hyped excuses for raising gasoline prices to match the retail prices of everything else. (In the mid-1960s when gasoline in New York was around 30 cents per gallon, I remember paying about 25 cents for a loaf of bread or quart of milk and 10 or 15 cents for a slice of pizza.)
Funnily enough, if you take into account that all the greed exhibited to date has only pushed gasoline prices in the U.S. to the point where it is just level with other consumer items then maybe it could be said that $4 a gallon gasoline is a great deal.
The reason why there’s such a great uproar over the price of gasoline, versus the price of milk or bread, is that no individual consumer spends $50+ per week to fill up on milk or bread or pizza (with some multi-vehicle households spending two or three times the $50+ per week). So, perhaps the gasoline crisis is simply a crisis of perception, not reality.
Either way, knowing that the price of gasoline is where it should be (by standards of inflation), doesn’t make any of us feel better, unless you’re an oil company executive. And knowing that there’s no real end to the world’s supply of oil doesn’t mean to say that temporary shortages can’t occur if oil production levels don’t meet real demand or if there are failures in the pumping, refining and distribution system. And understanding that $130 a barrel oil price is just because of greedy commodity speculators doesn’t mean that these same guys can’t push the barrel price up to an amount that makes the per gallon price double or triple what it is now.
THE REAL REASONS WE NEED ALTERNATIVE FUEL SOURCES
To me, the reasons to find alternative fuel sources are:
1. To take the weapon of oil production and supply out of the hands of fear mongers or greedy speculators and those peoples that would like to use it against us democracy-loving consumers.
2. To improve the environment (not because of a man-made global warming fantasy, but because clean air is just a whole lot nicer than filthy air). And, of course, if we can do all of this at a lower price than gasoline, then that’s even better.
REQUISITES FOR A GASOLINE ALTERNATIVE FUTURE
1. We need an ample supply of vehicles that can reliably utilize an alternative fuel
2. We need ample distribution and supply outlets for the alt fuel(s)
3. We need abundant resources (preferably located on the North American continent) to ensure a continuous supply of the raw material to produce the alt fuel.
4. We need available, plentiful, and affordable environment-friendly fuel solutions to the gasoline predicament (regardless of how or why the crisis exists and which conspiracy theory you subscribe to).
The potential alternate fuel solutions are:
Electric (straight plug-in battery or fuel-cell related)
Hydrogen - internal combustion engine
Compressed Natural Gas (CNG)
Story continues at Part 1 of How We Can Eliminate New Gasoline-Powered Vehicles In The U.S. By 2014.
The Auto Channel has presented extensive coverage (including tons of video) of several major alternative fuel and vehicle events, which can help you understand all the issues and all the options that are available. We suggest you start with the following two links and then simply enter "alt fuel" or "alt vehicles" in our search box at the top of this page for hundreds of additional individual stories and video.2008 Alternative Fuels and Vehicles Conference in Las Vegas
ALT CAR EXPO in Santa Monica
Plug-In 2008 Conference and Exposition in San Jose