Let's Keep Those Fuel Prices High!!!

Call me crazy, but I actually like the way the gas prices are trending. For decades, America has consistently had the cheapest gas on the planet, which has gotten us into all sort of questionable lifestyle habits. Which habits we're probably not going to shake anytime soon; gas is about $4.40 a gallon, and assholes are still driving their Hummers and F350 pickups. I suspect those are the same people that are clamoring for the government to do something about the problem, which strikes me as irony at its best. Also the fact that such vehicles are often parked at the Starbucks near my office. People get upset about $4.40 per gallon of gas, but they think nothing of paying $5 for a PINT of coffee. Go figure.

For my part, I don't drink Starbucks, and I drive a Toyota. I've considered getting a more efficient vehicle, but the sad truth is that a hockey bag ain't gonna fit on the back of a motorcycle. Especially if I'm goaltending. Besides which, my career as a professional mercenary means that I do okay financially. Added to the fact that I've started driving pretty slow, and high energy prices make no real difference whatsoever in my live.

But what high energy prices have done is spur the development of all sorts of cool shit that have been periphery technology for years or decades. There were economic reasons that America has gotten oil from the middle east for so long: that was the cheapest way to do it. Even after pumping it out of the ground on the other side of the world, transporting it thousands of miles, sometimes in the face of hostile nations, refining it into usable form, and then transporting it from the refinery to your local Chevron, it was $2 a gallon for a long time. Compare to other commodities. That was less than the price of milk, way less than the price of beer, and astronomically less than the price of Astroglide. Although we sent billions of dollars to the middle east for oil, they sent a WHOLE LOT of barrels our way, and got rich only on volume.

Now rest assured that America is going to continue to run on gasoline. Although some Japanese auto-makers are pre-releasing a line of hydrogen-powered cars to directors and movie stars are a precursor to general release later this year, I don't think it's going to be more than a fad. First of all, liquid hydrogen is not all that easy to manage, and you can't exactly get it on every corner. Part of the process of releasing hydrogen cars is setting up the infrastructure and logistics of supply. Which represents a HUGE gamble for the automaker in question, since if sales don't pan out, that outlay goes down the toilet.

Second of all, hydrogen is not all that efficient as a fuel. It is amazingly efficient to burn, but there's more to the equation than that: while hydrogen is the most abundant element in the universe, it - unlike oil - does not exist in abundance in usable form on the planet earth. Which means it needs to be produced industrially, either by breaking up hydrocarbon chains into base elements, or by separating it from water: both processes involve very energy-intensive processes, and the end result is that it takes more energy to create a gallon of liquid hydrogen than you get from burning that liquid hydrogen. It's the same problem as with early electric cars, the ones that had to be plugged in to recharge. Sure, you save on gas, but the energy has to come from somewhere, and - what with the fact that batteries generally suck from an efficiency standpoint - people spent more on their electric bills from charging their plug-in cars than they saved on gasoline. Thus, plug-in cars were fads, and didn't become economical until hybrids came into being (and hybrids are actually less efficient electrically, but make up for it mechanically, since they can capture the energy lost from braking).

Hydrogen is energy expensive to produce, so will go the same way as plug0in cars. Hydrogen works great as an energy storage medium for certain process (like home solar set-ups), but it's not economical to use in cars. As efficient (and clean) as it is as a fuel, it's still a hell of a lot more expensive than gasoline, and is going to stay that way. Barring a revolution in the chemistry and physics of hydrogen production, hydrogen cars will be limited to wealthy hollywood tree-huggers.

For the same reason, and barring a similar revolution, you can forget about shit like solar and wind power. Yes, it is superbly renewable and extremely efficient. But it's still to expensive to use on large scales, and small scales don't produce enough energy to feed an energy-starving society. Tidal plants using Wells turbines have some potential, but the science is still being worked out, is limited to certain coastal areas, and there are questions as to how much further it can go.

But there is good news: we will continue to drive and operate, by using cheap fuels, distributed through our pre-existing (gas-station based) distribution network. And the fuels are ones that everyone knows: gasoline and diesel fuel. Amazing as it sounds, the middle east does not have a world monopoly on oil. The United States is actually the world's third-leading producer of oil. It just consumes more oil than the next four highest nations put together. It merely seemed the middle east had a monopoly, because they were the greatest exporters, and because they could supply it at prices so low that all possible competition was stamped out economically. But no more. Middle-east oil is now so expensive that alternative sources of oil are becoming viable.

First and foremost, there are oil wells that were not economically feasible until now. Notably large undersea depositions, and other hard to reach places. It's now worth the cost to go get them. Likewise things like oil shale, which exists in abundance in local places like Colorado, and in raw energy content theoretically exceeds the reserves of Saudi Arabia. Before, it was just too expensive to industrially cook crude oil from the shale, since ready-made crude was available for cheap. Until now, that is. Rest assured oil shale is receiving serious consideration from On High. And then there are things like ethanol. It has been possible for years to distill burnable hydrocarbons from any organic matter containing appreciable amounts of sugars. You can even do it in your backyard. Along similar lines, any diesel engine can be modified to operate on normal vegetable oil (or peanut oil, or what have you). The problem with that - besides the energy cost of running a still - has always been that those sugars and oils were more valuable as foods than as fuels. Realistically, they still are.

But hope springs eternal, followed quickly by technology. Our good friends in Silicon Valley are already engineering bacteria that create crude oil from organic matter that is more or less useless for human consumption. Things like wheat and corn stalks (the stuff left over from the plant when the wheat or corn is removed). Or wood pulp. Or raw sewage. Anything the e-coli can survive on, in theory, which is a long list. Hopefully our energy needs won't reach Soylent Green levels, but the technology is already there to make it happen.

There are also things like thermal depolymerization, which can generate burnable hydrocarbon fuels (light crude) not only from organic sources like chicken industry byproducts, but also from plastics, medical waste, or old tires. It mimics the geological process of using heat and pressure to break down long carbon chains into shorter chains (methane, benzene), and is already being tested on industrial scales. With the increase in prices of foreign oil, things like this gain increasing attention as oil sources. Which means they gain tax breaks, subsidies, and venture capitol.

Anyone reading this knows I'm not a big fan of rose-colored glasses, but economics of oil are going to hugely benefit the United States in the next 30 years, since the United States is the nation in by far the best position to develop these emerging technologies into workable industries. So imagine: rather than buying a Saudi prince a new jet (or buying 7.62x39 ammo for terrorist AK-47s), the money you pay on gas goes to a bacterial plant in Kansas, which uses some of that money to buy corn and wheat straw (from farmers in the mid-west) to cook into crude. Landfills are strip-mined for plastics and other non-decomposables, which get fed into thermal depolymerization plants to make fuels and more plastics. Utility companies will boom when power companies want to buy America's trash to make energy. The technology is already there. While the US will probably never be a net exporter of energy, it will - through necessity - become much more capable of supporting itself, which means that many more dollars staying within the American economy.

Make no mistake, the Saudis are scared shitless that the price of oil is so high, since that's creating a market that will ultimately put them out of business. While this may not parley into savings for the customer, the Saudis will have to reduce the price of their oil to match prices of other oil. Otherwise, the alternative sources will claim ever larger portions of world sales. And the Saudis actually need us a hell of a lot more than we need them. What the hell else do they have to sell, other than oil? Makes you wonder what's going to happen to world politics vis-a-vis the middle east when the world no longer gives a damn about their oil.

I could go on for hours about the social and economic implications of expensive gas, both at local and global levels. Let me know if there's any particular point you want to hear more about.