Oil or Energy?

September 1, 2009
by Maura Dilley and Dermot Hikisch

Did you ever wonder how much renewable energy you could get for the same price as going to war in Iraq? Since the Downing Street memos proved that we went to war to secure energy not to fight terrorism, let’s think of some ways we could get energy without putting lives at risk. Looking at the $570 billion military bill to date, how much renewable energy would the US have right now if we had chosen a wiser investment? Well, a heck of a lot.

In 2003, the United States began the attempt to assume and maintain control of Iraq. Far from the quick ‘mission accomplished’ promised by the Bush administration for $50 billion, investments in the war effort have increased almost every month since the US invasion began. The current tally of American tax money spent by the US military on the Iraq War is over $570 billion with the final bill expected to ring in around 1 trillion dollars. Yet somehow, gas has nearly topped $150 per barrel this year, up from the $40 barrel price of 2003. It seems that despite this massive allocation of funds, Americans have not received a return on investment.

Furthermore, numbers presented thus far only represent direct spending by the US military. As wise investors, American taxpayers should prudently insist on real cost accounting for this war. Real cost accounting books lost investment as well as forfeited social and environmental capital to come out with a number that accurately depicts our risk. Accounting for the economic loss of an increasingly depleted workforce, extensively destroyed infrastructure, and a thoroughly toxic environment, the real costs of the war on Iraq balloons into a sum around 3 trillion dollars.

And what if in this real cost assessment added up not just the money spent on the war abroad but also the lost domestic opportunity costs. Consider legendary oil tycoon T. Boone Pickens: in April he announced plans for a $10 billion dollar wind farm mega-project in Texas. On 2% of the US war budget for Iraq this four-year project will bring on line 2,700 massive wind turbines producing 4,000 megawatts of electricity – enough to power one million homes in the US. If the same project was done with a $570 billion budget (assuming we get no price discounts for bulk purchases) 153,900 wind turbines could be manufactured and installed in the United States. 153,900 wind turbines could have peacefully blown 227,770 megawatts of electricity into the US power grid, enough to power nearly 57 million homes, half of all households in the US.

Wise investors will note that making renewable and responsible energy requires that we find the right energy solution for each region, e.g. wind in the Midwest, solar and geothermal in the Southwest. We use the wind just to exemplify that in the same amount of time that we have been at war, we could have created a renewable energy source equal to 50% of the total electricity demanded by homes in the US. With developing technologies, renewable electricity can be transferred to batteries and fuel cells for use in transportation. For the same price as a war, much of the country could be well on their way running on American made, reliable, clean and sustainable energy. Produced by, gainfully employed green collar American citizens. So the question remains: why do we prefer oil to energy?

"Drill Baby Drill" is a short sighted 4 year bandaid.

During my visit to the US over the past three weeks, the GOP Party line of "Drill Baby Drill" has again and again reached media headlines and put Republican supporters into a frenzy. Yes, there is oil off the US coastlines and in the protected wilderness range of Alaska.

But is the time, money, and known risks to the aquatic, the atmospheric, and the untouched land environments really worth it?

There are many energy alternatives to further oil extraction from high risk ecological zones.

Renewable energy technologies and overall energy conservation measures are but two now cost effective avenues that need to be considered for a large scale implementation.

What will the "drill baby drill" approach give US citizens? At the very best, 4 and a half years of energy supply. Just over one presidential term.

Consider the facts:
The US currently consumes over 20,730,000 barrels of oil per day (7.57 Billion barrels per year)
The Interior Department estimates that there is still 18 Billion barrels of oil offshore and the US Geological Survey estimates 5.7 to 16 Billion barrels is buried in the Alaskan wilderness.

Best case scenario (assuming US oil consumption remains stable): Four years six months.

Worst case scenario (same stable consumption rate): Three years and six weeks.

The United States needs a real solution to energy security issues and "drill baby drill" is not it.