Attempting to make good on its "all of the above" energy strategy, the Obama administration recently floated proposals for oil development that have infuriated members of Congress on both coasts, but for very different reasons.
Alaska's legislators want more of it, but the administration proposed to place areas off limits. Meanwhile, some Eastern seaboard senators don't want it at all, but the administration is proposing to sell leases off their coast.
Late last month, the two factions held dueling press conferences to denounce the proposals and vow retaliation. What got lost in the hue and cry, however, is a broader question: With oil prices at record lows and the United States the world's top oil producer, why risk pristine wilderness, coastal economies, public health and the environment when we have the wherewithal to slash U.S. oil consumption in half?
Nice Little Snow Globe?
The Alaska delegation, led by Sen. Lisa Murkowski, is apoplectic over Interior Department proposals to prohibit oil development in certain Arctic Ocean areas and designate more of the Arctic National Wildlife Reserve "wilderness," protecting it from development. The reserve, which sits in the northeast corner of the state, provides critical seasonal habitat for caribou, musk oxen, polar bears, and more than 130 migratory bird species.
"We're not going to tolerate it," Murkowski said at a joint January 26 press conference with Sen. Dan Sullivan and Rep. Don Young. "We will do everything we can to push back against an administration that has taken a look at Alaska and decided it's a 'nice little snow globe up there and we're going to keep it that way.' That's not how you treat a state."
In fact, a significant amount of federal land in Alaska, as well as water off its coast, is open for business. The oil and gas industry currently owns leases to an area larger than the state of Delaware -- more than 1.8 million acres -- but has developed only 1 percent of it. And while the Interior Department proposal calls for protecting areas that are critical to marine mammals and native Alaskan subsistence whaling, it would still leave more than 92 percent of federal Arctic waters open to leasing.
What gives the industry pause is the harsh climate. ConocoPhillips and Shell, for example, have each spent billions of dollars trying to develop ocean leases without producing a single barrel. These days, the industry is much more keen on drilling in the lower 48 and the Gulf of Mexico. It's cheaper -- and easier.
Mixed East Coast Reaction
On the other side of the country, Ed Markey of Massachusetts and Ben Cardin of Maryland were among the East Coast senators who blanched when Interior proposed to open up federal waters, from Virginia to Georgia, to oil and gas development.
"If drilling is allowed off the East Coast of the United States, it puts our beaches, our fisherman, and our environment in the crosshairs for an oil spill that could devastate our shores," Markey said at a January 27 press conference he held with Cardin and New Jersey Sens. Robert Menendez and Corey Booker. "We're going to make it clear we're very unhappy with this plan.... You're looking at the beginning of an alliance to put pressure on this administration to withdraw this proposal."
The congressional response to the East Coast proposal was not uniformly negative, however. The senators who represent the four states that would be most directly affected -- Virginia, North Carolina, South Carolina and Georgia -- support drilling. They see it as a potential new source of badly needed revenue for their states, which were hit hard by the Great Recession.
Virginia Sens. Mark Warner and Tim Kaine, for example, released a joint statement on January 27 calling the proposal a "significant step...that should result in the safe, responsible development of energy resources off the Virginia and Mid-Atlantic coasts."
Dirty Business
Safe, responsible oil development?
The oil industry's track record on Alaska's North Slope, where its operations span some 1,000 square miles of fragile, once-pristine Arctic tundra, is hardly encouraging. Between 1996 and 2008, there were nearly 6,000 spills, an average of nearly 500 a year.
Offshore oil operations are not doing much better. According to the Interior Department, more than 1 million gallons of oil leaked from offshore oil and gas operations in 579 incidents between 1993 and 2012, not including the 2010 BP Deepwater Horizon disaster, which spewed more than 200 million gallons of crude into the Gulf of Mexico. Dotting the Eastern seaboard with oil rigs would invariably lead to spills, and a major blowout or another Sandy-like hurricane could do incalculable damage to North Carolina's Outer Banks, Virginia Beach and the Chesapeake Bay.
Besides spills, drilling generates massive amounts of air and water pollution. North Slope oil operations, for example, annually emit more than 70,000 tons of nitrogen oxides, which contribute to smog and acid rain. They also release millions of metric tons of carbon dioxide and tens of thousands of metric tons of methane, two primary drivers of climate change. Meanwhile, the average offshore oil and gas well annually emits some 50 tons of nitrogen oxides, 13 tons of carbon monoxide, 6 tons of sulfur dioxide, and 5 tons of volatile organic chemicals, while every day it can discharge hundreds of thousands of gallons of "produced water" -- a nasty brew of arsenic, benzene, lead and other toxic substances that wells disgorge along with oil and gas.
Then there's the damage done even before the drilling starts. If Interior goes through with its proposal to lease areas 50 miles off the East Coast, oil companies will use seismic air guns to map the sea floor for oil and gas deposits. These high-decibel sonic explosions -- which could go on for months -- would harm fish and injure as many as 138,000 marine mammals, including whales and dolphins, according to Oceana, a nonprofit advocacy group.
Too Little, Too Late
Putting the pollution issue aside, here's another inconvenient fact: While there's a considerable amount of estimated oil in U.S. Arctic waters -- which is extremely difficult to develop --there's actually not much in the Arctic Refuge or along the Eastern seaboard, especially compared to the estimated 48.4 billion barrels in the Gulf of Mexico.
According to federal calculations, there are 2.97 billion barrels of technically recoverable oil on the Mid-Atlantic and South Atlantic Outer Continental Shelf, which includes areas off the coast of Maryland and Florida, and 7.7 billion barrels of technically recoverable oil on the Arctic National Wildlife Refuge's coastal plain.
Those estimates, however, don't account for the cost of finding, developing, producing and transporting the oil. The amount of economically recoverable oil would be less. In 2013, the United States consumed 6.89 billion barrels of oil. Based on that, economically recoverable Arctic Refuge oil would amount to a year's worth at most, and offshore oil from Virginia to Georgia would cover less than six months.
Of course, that oil would not be pumped all at once. It would take years to find it, drill it, refine it, and deliver it. If the oil industry started operations in the Arctic Refuge today, it would still take seven to 10 years to begin to get its oil to market. Offshore East Coast oil likely would take longer. Leasing there wouldn't begin before 2021, and drilling likely wouldn't start before 2025.
Cut Oil Consumption, Save Billions of Dollars
Ultimately we're talking about a relatively small amount of oil that wouldn't be available for at least a decade. Given oil's considerable drawbacks, wouldn't it make more sense to focus national attention on consuming less?
The fact is, we can dramatically reduce our appetite for oil. In 2012, the Union of Concerned Scientists (UCS) provided a blueprint for cutting projected U.S. oil use in half over the next two decades. Identifying a number of ways to wring oil out of the economy -- from retrofitting buildings to producing better biofuels to making planes, trains and ships more fuel efficient -- the group calculated that we can feasibly slash annual demand by more than 4 billion barrels by 2035.
The single biggest step the United States can take toward halving oil consumption, UCS says, is to double the fuel efficiency of cars and light trucks. That can be accomplished through such off-the-shelf, fuel-sipping technologies as high-efficiency engines, smarter transmissions, hybrid powertrains, and better aerodynamic design. According to UCS's analysis, adding more hybrids, plug-in hybrids and electric cars, as well as more efficient buses and commercial trucks, would get us more than half way to that goal.
Thanks to the Obama administration's efforts to boost fuel efficiency and limit tailpipe emissions, Americans are already using less oil, polluting less, and saving billions of dollars at the pump.
The average fuel economy for the 15 million cars and trucks sold in 2013 was 24.1 miles per gallon (mpg), a 7 percent increase from 2010, according to the Environmental Protection Agency. Compared to average 2010 model fuel economy, that translates to a drop in oil consumption of 14.6 million barrels a year, roughly equivalent to the production of 130 new onshore oil wells.
But that's just the beginning. The new fuel efficiency and carbon emissions standards will require U.S. auto fleets to average about 26 mpg by 2016 and about 37 mpg by 2025. By 2030, the standards will result in oil savings of more than 1.1 billion barrels a year, UCS says, saving drivers a whopping $140 billion.
Jerry Brown Leads the Way
While members of Congress obsess over future oil royalties -- and put their constituents and the environment at risk -- the man who oversees the world's eighth largest economy is taking a very different tack.
In his January inaugural address kicking off his fourth and final term, California Gov. Jerry Brown called for generating 50 percent of his state's electricity from renewable energy sources, doubling the energy efficiency of existing buildings, and -- taking a page from UCS's playbook -- cutting vehicle oil consumption by as much as 50 percent in the next 15 years. California's current renewable energy goal is a third by 2020.
"Taking significant amounts of carbon out of our economy without harming its vibrancy is exactly the sort of challenge at which California excels," Brown said. "This is exciting, it is bold, and it is absolutely necessary if we are to have any chance to stopping potentially catastrophic changes to our climate system."
Ever the wonk, Brown spelled out how to get there. "I envision a wide range of initiatives: more distributed power, expanded rooftop solar, micro-grids, an energy imbalance market, battery storage, the full integration of information technology an electrical distribution, and millions of electric and low-carbon vehicles," he said.
"How we achieve these goals and at what pace will take great thought and imagination mixed with pragmatic caution," he added. "It will require enormous innovation, research and investment."
What it won't require is drilling in the Arctic Refuge, Arctic Ocean or along the Eastern seaboard.
Elliott Negin is a senior writer at the Union of Concerned Scientists.