[Congressional Record Volume 153, Number 168 (Thursday, November 1, 2007)]
[House]
[Pages H12444-H12450]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
PEAK OIL
The SPEAKER pro tempore. Under the Speaker's announced policy of
January 18, 2007, the gentleman from Maryland (Mr. Bartlett) is
recognized for 60 minutes.
Mr. BARTLETT of Maryland. Mr. Speaker, today oil's about $93 a
barrel. It was higher than that a couple of days ago. If you look at
CNBC, they're still scrolling it in red which means it's kind of out of
previous limits.
There are two bills before the Congress, and I want to mention those
before we start. These would be pretty good bills if we were offering
them 25 years ago, but this is not 25 years ago. And I would submit
that these bills are woefully inadequate to address the challenges that
we have today. Let me just mention briefly what's in these bills, and I
will note and I hope you will agree after we've spent these few minutes
together that these bills do little more than nibble at the margins of
the problem.
Our children, our grandchildren looking back on today will wonder how
could we ever have thought that these bills would address the enormous
challenge that we face today in energy.
H.R. 3221, the House-approved omnibus energy bill, which they say
promotes efficiency and renewable energy, it includes a controversial
renewable portfolio standard and a net tax increase, but it excludes
increases in CAFE standards, the standards that we set for how many
miles per gallon you're going to get from your car or your pick-up
truck, and it also excludes mandated volume increases in biofuels.
Now, the Senate bill does quite the opposite. It increases CAFE
standards and a mandated volume increase in biofuels, but excludes a
renewable portfolio standard and the tax provisions.
Now, President Bush wisely has indicated that he's going to veto
either one of these bills, or a combination of these bills that might
come out of conference.
I note these two bills before we begin our discussion because I hope
you will agree with me when we have finished our discussion that they
might have been pretty good bills to start down the road that we should
have been traveling for 25 years, but they're woefully inadequate to
meet the challenges of today's world.
Here we have a chart which I think kind of says it very well. Here is
the fellow standing by the very shrunken gas pump here because our
supplies are down. He has a huge SUV beside him. He asks, ``Just why is
gas so expensive?'' Gas is expensive because the demand is exceeding
the supply. As a matter of fact, the world production of oil has now
held constant for about 30 months, but the world's demand for oil has
been steadily going up. So if you look back over the last 30 months,
the price of oil has been doing exactly what you would suspect the
price of oil has been doing. It's been going up because the supply has
been constant and the demand has been going up.
Mr. Speaker, it was absolutely inevitable that today or some day like
today near this date in history that we would be here talking about $95
oil.
{time} 1645
If you listen to the experts out there, they are telling you that
they expect, in the next few days, that it will go through $100 per
barrel.
The next chart is one that kind of puts this in perspective. Let's
just refer to the upper chart. The upper chart looks back through only
about a little less than 400 years. But if we extended this on to the
left here about another 7,000 years, we would have gone through all of
the recorded history of man, and it would look just like it looks here.
In this scale, the amount of energy that we were using in 1630 and 1650
is hardly wider than a line, so it's hard to distinguish the baseline
here from the energy that we were producing.
Then the Industrial Revolution started, and it started with the steam
engine and that sort of thing and wood, of course. That's the brown
line there. Then you see that we found coal and, boy, we produced a lot
more energy with coal, so the Industrial Revolution roared on. It was
stuttering when we discovered oil. Boy, then did it take off. Just look
at that curve and how sharp that curve is.
If we had another curve here on population increase in the world, it
would mirror this, follow this pretty exactly. For thousands of years,
through 8,000 years of recorded history up until fairly recent history,
the population of the world was somewhere between half a billion and 1
billion people. Now that population has exploded until there are nearly
7 billion people in the world. By the way, nearly 2.5 billion of them
are in India and China.
Notice one other thing about this curve. Look what happened back in
the 1970s. The oil price spike hikes of the 1970s, where oil was less,
even with inflation correction oil was less than it is today, it still
resulted in a world-wide recession with sufficient demand destruction
that the production of energy decreased for several years. Now we are
back on a big upswing slope again.
The next chart has some data that was used by 30 of our prominent
Americans, Boyden Gray and Woolsey and McFarland and 27 others, among
them a number of Four-Star Admirals and Generals, retired, and they
wrote a letter to the President, and this was several years ago. They
said, now, Mr. President, the fact that we have only 2 percent of the
known reserves of oil in the world and we consume 25 percent of the
world's oil and import just about two-thirds of what we use is a
totally unacceptable national security risk. We really have to do
something about that.
Two other data points here which are of interest, one is that
although we have only 2 percent of the world's oil reserves, we produce
8 percent of the world's oil. Now, you don't have to be very far along
in arithmetic in grade school to understand that if that's what's
happening that we are now exploiting our oil reserves four times faster
than the rest of the world.
So if there comes a time when the well will run dry, you would expect
that our wells would run dry before the average well in the rest of the
world, because we are pumping our oil four times faster.
Note, also, this says 5 percent of the world's population, we are a
bit less than that. We are one person out of 22 in the world, and we
have a fourth of all the good things in the world. The subject for
another discussion is why. What's so special about the United States
that this one person out of 22 is so fortunate that we have a fourth of
all the good things in the world?
The next chart is a really interesting one. This chart shows what the
world will look like if the size of the country was relative to the
amount of oil that it had. Now, the colors here indicate how much
energy you are using and the size indicates how much energy you have.
What this shows is that the countries which have the least energy are
using the most energy.
But notice that Saudi Arabia here totally dominates the world. About
22 percent, almost a fourth of all the known reserves of oil in the
world are in Saudi Arabia. There is Iraq and little Kuwait. Saddam
Hussein thought that looked like a corner province in Iraq, and,
indeed, if you look in the map, it is tiny compared to Iraq, but it has
just about as much oil as Iraq.
Iran, notice how big Iran is there.
Look over here at the United States. We are dwarfed. We have only 2
percent of the world's supply of oil. The people we get most of our oil
from are Canada and Mexico. Gee, they aren't very big either. Look at
Venezuela, Hugo Chavez, huge, would swallow up the United States
several times with its oil reserves.
[[Page H12445]]
Something I would really like you to note is the size of China and
India. Between the two of them, they don't have as much oil as the
United States, and they have about 2.5 billion people between the two
of them.
Now, as a result of this disparity between how much oil they have and
how big their population is, the next chart will show us what China has
been led to do. This is a map of the world which shows where a number
of people have staked their claim, that is, own oil reserves. Notice in
how many parts of the world the symbol for China appears.
This chart is a little old, and at the time we started using this
chart, China was dickering to buy Unocal, an oil company in our
country. Well, a lot of people thought that was just awful. I didn't
think the sky would fall if they did that, because the reality is in
today's world it doesn't really matter who owns the oil. We own an
absolute trifling amount of oil in the world.
The fellow who owns the oil and the fellow who comes with the
dollars, and if, by the way, if the currency ever changes from dollars
to Euros, that will be a tough day for our country, but the person who
has the dollars gets the oil. So you might ask why is China buying up
all this oil.
I asked the State Department that question, and they told me it's
because they don't understand the economic realities. They don't really
understand that it doesn't matter who owns the oil, that the person who
has the dollars buys the oil. My response was, gee, it's a little hard
for me to believe that a country of 1.3 billion people, which is
growing for the last quarter, I saw data, 11.4 percent, we never grew
at anything like that. Japan in its heyday didn't grow anything like
that. A country growing 11.4 percent that doesn't understand economics
is hard for me to believe.
You may note at the same time they are buying up this oil they are
aggressively building a blue water navy. They don't have one. Blue
water navy is one that goes out in the deepest waters. We are the only
one in the world the Chinese are competing with.
Could it be that they envision a time when there won't be enough oil
to go around, and since they own it, they are going to say to the rest
of the world, gee, guys, I am sorry, there is not enough oil to go
around, and we have 1.3 billion people and so we are going to use it.
To make that stick, they are going to need a really big navy to protect
their sea lanes. Only the future will tell.
I led a codel of nine people to China talking about energy. It was
over last New Year's. I spent last New Year's Eve, as a matter of fact,
in Shanghai. They began their discussion of energy there by talking
about post oil. Wow. They get it, and I wonder why very few people in
our country get it.
They have a five-point program. The first step in their program is
the first step in any rational program to address the challenge we
face, and that is conservation. The second and third points in their
program was get as much of it as you can from your own country and
diversify as much as you can.
The fourth one may surprise you, because they pled for protection of
the environment. They are the biggest polluters in the world, and they
know that. They are kind of pleading for help, because, gee, we have
got 1.3 billion people, 900 million of those in rural areas that are
clamoring for the benefits that accrued through industrialization. We
have got to really do something about that, and help us to be more
efficient.
But the fifth point in their five-point program was a really
interesting one. They are pleading for international cooperation.
As they plead for international cooperation, which they hope they
get, I doubt that they will, but they have a backup, they are going to
buy the oil so that if we don't get international cooperation, at least
they have a go-it-alone reasonable probability of doing well in
the future.
The next chart shows how we got here, and this tells you why I
mentioned the 25 years. It's actually 27 years.
In 1956, a Shell Oil geologist by the name of M. King Hubbert, and if
you haven't heard his name before, you will hear it, and I think that
the speech he gave 50 years ago last year, I think it was the 8th day
of March, to a group of oil executives and engineers and scientists and
so forth in San Antonio, Texas. When the United States was king of oil,
producing more oil, exporting more oil, I think, than any other
country, M. King Hubbert told that group that in just 14 years, by
1970, we were going to reach our maximum oil production. No matter what
we did after that time, it was going to go down.
Shell Oil Company asked him, please don't give that speech. You are
going to make a fool of yourself and us. He became something of a
pariah for a number of years and was relegated to the near-lunatic
fringe.
But right on schedule, as this chart shows, in 1970 we peaked in oil
production. He predicted that here in 1956, and in 1970 we peaked in
oil production.
His prediction was only for the lower 48. We got a bunch of oil in
Prudhoe Bay in Alaska and a lot of oil in the Gulf of Mexico, where, by
the way, we have drilled more oil wells than in all of Saudi Arabia,
four times as many as in all of Saudi Arabia.
It has been downhill ever since 1970 except for a little blip
produced by the enormous amount of oil that we got from Prudhoe Bay. I
have been there. I have seen that pipeline where it begins, a 4-foot
pipeline.
For a number of years a fourth of our total domestic production went
through that. Despite that enormous find, it's still down, down, down,
and today we are producing half the oil that we produced in 1970.
Remember several years ago those fabled oil discoveries in the Gulf
of Mexico which were supposed to secure our future? There it is. That's
what it did. Pretty trivial, wasn't it.
The next chart shows an attempt of one of the major think tanks in
our country on energy to debunk M. King Hubbert. This us the Cambridge
Energy Research Associates, and they present this data, which they say
proves that M. King Hubbert didn't know what he was talking about.
Now, if you were a person who dealt with numbers, a statistician, you
might see some relevance in that argument. But for the average citizen,
this is what you see in the chart.
The yellow symbols here are the predictions of M. King Hubbert. The
green is the actual lower 48 production.
Now, he said that it would follow this curve, but it actually
followed that curve. Cambridge Energy Research Associates said, gee,
isn't that awful, he really missed it, didn't he. I think for the
average person looking at that, I am a kind of a layman here in this
area, but I am a scientist and I have had courses in statistics, that
looks pretty darn close to me. I think he kind of got it, didn't he.
The actual total production, when you add the Gulf of Mexico and
Alaska, these red symbols here, and if you add the next chart, if you
only had one chart to talk about energy, this would be the one, because
this tells you so much.
If ever a picture is worth 1,000 words, this one is. This shows the
discoveries of oil. We were discovering lots of it very early, the
1940s, 1950s, huge, huge amounts in the 1960s and 1970s. At just the
time when M. King Hubbert predicted we would reach our maximum oil
production, 1970, here, we just previously had found enormous amounts
of oil.
During those 14 years, 1956 here to 1970, we had found more oil than
we ever found before and ever found after that. No wonder, gee, they
thought this guy must be an idiot.
But right on schedule we peaked in 1970. By the way, just a little
explanation of how he was able to do that. He had observed that each
oil field followed a pretty constant kind of curve. The oil was easier
and easier to pump until you pumped about half of the oil.
Then you reach the maximum production, it's reasonable. The last half
would be harder to get, so it came out slower and slower. It kind of
followed a bell curve. He rationalized if he knew how many oil fields
there were and what was in there, he could have all the little bell
curves, and you would get a big bell curve that would tell us when we
were going to reach the peak. He said that was going to be 1970. Right
on schedule it happened. He also said that we were going to reach peak
oil, the maximum production of oil in the world about now.
{time} 1700
Now, the question I've been asking for 30-some times I've been on the
floor
[[Page H12446]]
here talking about this, over the last couple of years is, if M. King
Hubbert was right about the United States, why shouldn't he be right
about the world? And why shouldn't we have been paying some attention
to this?
I was interested in this subject probably 40 years ago. I knew that
oil couldn't be forever. I mean, you know, the Earth isn't made out of
oil; it's not going to last forever. At that time I had no idea how
long it would be before we had to start being concerned about oil. Was
it next year, 10 years, 100 years, 1,000 years? But I knew at some time
we would need to be concerned about oil. Apparently, that time has
come.
Well, the solid black line here indicates our consumption of oil. It
also represents our production of oil, because there's no big stockpile
of oil somewhere unused, so what we produce is what we use. So it's
either the consumption curve or the production curve.
If we were to put a smooth curve over these discoveries, and there we
have little bars for each year, it's obvious that what you've done is
to add up all of the discoveries year by year. So the area under that
curve, for the person who doesn't understand what integration is, the
area under that curve represents the total amount of oil we've found;
so much this year and this year and this year. And the area under the
curve adds them all up.
Now, the area under this black curve here is going to indicate how
much oil we use. Now, it's really obvious that you can't use oil that
you haven't found. So the area under the consumption curve is going to
have to be the same thing as the area under the discovery curve.
But look at what's been happening to discovery since, what, before
1970. It's been down, down, down, down, down, down. The lightly shaded
part of this graph to the right is just a guess as to what's going to
happen in the future, but an absolute certainty is that you're not
going to pump oil that you haven't found.
Now, ever since the 1980s here, we have been pumping more oil than
we've found, so this area here now has consumed reserves that we found
in the past. So we have all this amount of reserves that we can use in
the future. That represents the area under this curve.
They're predicting here that we will have ever less and less
discovery. It won't be that nice smooth curve. It will be up and down.
But on the average, that's what it should be because that's what it's
been.
And by the way, for the past 20 years or so we have had incredibly
improved techniques for finding oil. So for those of who tell you not
to worry, it's out there, where? We've been scouring the world for the
last 20 years with computer modeling and 3-D seismic, and our discovery
has been down, down, down. And these people are wisely projecting
that's probably what it's going to do for the future.
There's another chart here, and this is another chart from CERA,
Cambridge Energy Research Associates. And they are predicting that
we're going to find two and three times as much more oil as all the
recoverable reserves that we now know are there. And even if that is
true, it moves the peak out only a relatively few years. This is the
curve, if we don't find any more than that previous chart showed.
Most of the experts in the world believe that the total amount of oil
that we have pumped and will pump is somewhere in the category of 2
trillion barrels. We've pumped about a trillion, we have about another
trillion to pump, more or less. So the peak, if that is so, is
imminent, isn't it?
If we find 2.93 total, wow, that's another trillion barrels of oil.
It pushes out only that far. And they say we're going to add some
unconventional oil. That we will. And so they, and this was in an
article that was debunking peak oil, and this was a major chart in that
article and, by golly, it shows a peak. They say it will be an
undulating plateau. I agree. I don't agree that it's going to be out
there another 50 years, but I agree that it's going to be an undulating
plateau.
The next chart is an interesting little exercise. And this is from
EIA, our Energy Information Agency, which, by the way, does a really
good job of tracking the use of energy. And it has done a pretty poor
job of projecting how much energy we're going to find, because this was
their projection. These are the discoveries of oil.
Remember that previous bar chart? These are the big spikes, the
discoveries of oil. And they, really misinterpreting some data from
USGS, predicted three different possible paths here. There was an F for
frequency in the USGS data, and somehow that got translated to P for
probability when it came to this chart. I have no idea how you'd do
that, and I have had a course in statistics, so I understand a little
about that.
But they said that the 50 percent probability was the mean and that
that is the most probable thing that would happen. Therefore, the
discoveries of oil were going to go up.
This is the 95 percent probability. If it's truly a probability,
obviously, if you're 95 percent more certain than 50 percent, and this
is the 5 percent; by the way, there should be another green line here
and another blue line here because it's a little bit like the path of
the hurricane. It's pretty tight today, but where it's going to be a
week from now you're less certain, so it kind of fans out. So that's
what these 50 percent and 5 percent represent.
But notice where the actual data points have been. The actual data
point have, as one might suspect, followed the 95 percent probability
because 95 percent probable is more probable than 50 percent probable.
The next chart is a chart from a report and I'm going to mention in
just a moment four major studies that have been done, and I have a
number of quotes from those. Because what I'm saying today is based on
not just my perception of what's going on, but the reality as indicated
in these four different studies.
This is EIA projections. And if we found as much more oil as all the
known reserves of oil today, that is going from roughly the 2 trillion
to 3 trillion barrels of oil. That will push the peak out only from
here to 2016.
And this shows another interesting thing. If we get really good at
enhanced oil recovery, and we drill a lot of wells and we suck it out
faster, we might move the peak over to 2037. Then you fall off a cliff;
because you can't pump what's not there.
Now, enhanced oil recovery will get a little more, but it may get it
a lot faster. There will be some additional oil pumped from enhanced
oil recovery, but it will not be a huge amount.
Now, I want to go through a number of quotes from five different
sources actually. One of those is a very famous speech given by Hyman
Rickover, the father of our nuclear submarine. He gave this speech 50
years ago, the 14th day of this May, in St. Paul, Minnesota, to a group
of physicians. He was incredibly prophetic in that speech. There's a
link on our Web site to that that you can simple do a Google search for
Rickover and energy, and this speech will pop up. I will tell you, it
is the most interesting speech that I have ever read. You'll be
fascinated by it.
Just a quote from this speech: ``Whether this golden age,'' and boy
is this a golden age, and he notes in this speech, by the way, that the
amount of energy that we have available to us represents a huge amount
of people working for us. The energy in a single barrel of oil
represents the work of 12 people working all year.
When I first saw that, I said, it can't be. But then I thought of how
far that gallon of gasoline or diesel, by the way, still cheaper than
water in the grocery store, how far that takes my Prius, I drive a
Prius, takes my Prius nearly 50 miles. How long would it take me to
pull my Prius 5 miles? I could do it. If it was on the level, I might
strain and do it very slowly. If it was uphill, I'd have to have you
come along to do it. But how long would it take me to pull my Prius 50
miles? An incredible amount of energy. This is indeed a golden age,
this age of oil.
He noted that every housewife 50 years ago had available to her the
work equivalent of 34, I think he said, faithful household servants. I
think it was 700 manpower efforts push your airplane through the sky,
and 100,000 the train down the track and so forth.
``Whether this golden age will continue depends entirely upon our
ability to keep energy supplies in balance with the needs of our
growing population.
[[Page H12447]]
Possession of surplus energy is, of course, a requisite for any kind of
civilization, for man possesses merely the energy of his own muscles.
He must expend all his strength, mental and physical, to obtain the
bare necessities of life. A reduction of per capita energy consumption
has always in the past led to a decline in civilization and a reversion
to a more primitive way of life.''
The next quote is another one from Hyman Rickover: ``High energy
consumption has always been a requisite of political power. The
tendency is for political power to be concentrated in an ever smaller
number of countries. Ultimately, the nation which controls the largest
energy resource will become dominant. That control today is represented
by having the necessary dollars to purchase it. Tomorrow it may be
indicated by who, in fact, owns the oil fields. If we give thought to
the problem of energy resources, we act wisely and in time to conserve
what we have and prepare well for necessary future changes. We will
ensure this dominant position for our own country.''
I would submit that we have done none of this. We have not acted
wisely. We have not anticipated today. And it was absolutely inevitable
that there would come a day when the supply of energy would be
inadequate to meet the demands for energy, which is why it's roughly
now 93, $95 a barrel.
There have been four studies paid for by our government. And much to
my chagrin, they have pretty much ignored what all four of these
studies have said. One of those was a study done for the Army by the
Corps of Engineers.
Now, these were published just September of 2005, just a couple of
years ago. There's another quote from him in just a minute. It's really
interesting. Jean La Harerre made an assessment of the USGS report,
that's the report we were looking at just previously that said we were
going to find as much more oil as all the oil that we now knew existed
which is recoverable in the world. And this was what Jean La Harrere,
he's a French expert in this area, said: The USGS estimate implies a
fivefold increase in discovery rate and reserve addition, for which no
evidence is presented. Such an improvement in performance is, in fact,
utterly implausible, given the great technological achievements of the
industry over the past 20 years, I mentioned those, computer modeling
and 3-D seismic, the worldwide search and the deliberate effort to find
the largest remaining prospects.
The next chart is another quote from the Corps of Engineers: Oil is
the most important form of energy in the world today.
By the way, all four of these reports said the same thing in slightly
different words, that peaking of oil is either present or imminent. By
peaking, we mean we've reached the maximum of production to produce it.
Try as hard as we will, it will not increase after that, but just go
down, down, down. It's being doing that in our country since 1970;
that's in spite of the fact that we have drilled more oil wells in our
country than all the rest of the world put together.
Putting a dozen straws in the soda will not result in more soda, will
it? It's a limited amount. There is a limited amount.
Historically, no energy resource equals oil's intrinsic qualities of
extractability, transportability, versatility, and cost. The qualities
that enabled oil to take over from coal as the front line energy source
for the industrialized world in the middle of the 20th century are as
relevant today as they were then.
The next chart is from the first report that came out. This is the
``Hirsch Report'' that came out a few months earlier than the Corps of
Engineers report. And they made some really startling statements there.
World production to conventional oil will reach a maximum and decline
thereafter. That maximum is called the peak. A number of competent
forecasters project peaking within a decade.
{time} 1715
I have a chart in a few moments which will show you those and when
they predicted it.
``Prediction of the peaking is extremely difficult.'' It is indeed.
And you will only know that it's peaked historically looking back to
see that, in fact, it peaked. And the production of oil, as I
mentioned, has been constant for the last 30 months. As a matter of
fact, conventional oil production has fallen off, but the total
production is constant because we've been producing some unconventional
oil. Heavy sours, sour oil is oil that has a lot of sulfur in it and
you need to get rid of that. And the Alberta, Canada tar sands that we
will talk about in a few moments.
``Oil peaking presents a unique challenge,'' they say. ``The world
has never faced a problem like this. There is no precedent in history
to prepare us for what will happen. Without massive mitigation more
than a decade before the fact, if oil has now peaked,'' which it looks
like it has, they said, we should have started a decade ago, and if we
didn't, there are going to be meaningful consequences is what they are
saying.
The next chart is a really interesting statement by our Secretary of
State, Condoleezza Rice: ``We do have to do something about the energy
problem.'' Thank you. We should have been doing something about it for
the last 27 years. I say 27 years because by 1980, we knew absolutely
that M. King Hubbert was right that the United States had peaked in
1970. It takes about that long to be really certain that peaking has
occurred, but I think we knew it, absolutely knew it.
``We do have to do something about the energy problem. I can tell you
that nothing has really taken me aback more as Secretary of State than
the way that the politics of energy is--I will use the word `warping'--
diplomacy around the world. We have simply got to do something about
the warping now of diplomatic effort by the all-out rush for energy
supply.''
It was bad then. In April of last year, oil was nowhere near $95 a
barrel then.
The next quote is another quote from the Hirsch Report. This is a big
report done by SAIC, Science Applications International Corporation, a
very prestigious international engineering scientific organization.
They say that the economic, social, and political costs will be
unprecedented. ``There is nothing in history to prepare us for the
economic, social, and political cost of the peaking of oil.'' And that
is not me saying that. This is a report from a major study done by a
very reputable scientific engineering organization paid for by our
government, by our Department of Energy. Have you heard the Department
of Energy talking about this? You might ask them why not?
The next chart, this was 50 years ago: ``I suggest that this is a
good time to think soberly about our responsibilities to our
descendants, those who will ring out the fossil fuel age. We might give
a break to these youngsters by cutting fuel and metal consumption so as
to provide a safer margin for the necessary adjustments which
eventually must be made in a world without fossil fuels.''
I think I noted earlier that when you talk to the Chinese about
energy, they talk about post-oil. The age of oil is now about 150 years
old. That's out of 8,000 years of recorded history. In another 150
years, we will be through the age of oil. There will, for all practical
purposes, be no more gas, oil, or coal. What will our world look like?
By the way, this is exhilarating for me. There is no exhilaration like
the exhilaration of meeting and overcoming a big challenge, and this is
a huge challenge. So this will be very invigorating.
The next chart is another one from the Corps of Engineers: ``In
general, all nonrenewable resources follow a natural supply curve.
Production increases rapidly, slows, reaches a peak, and then
declines.'' They are just validating what M. King Hubbert said more
than 50 years ago.
``The major question for petroleum is not whether production will
peak but when.'' Of course it will peak. It is inevitable.
You know, our descendents will look back on us and ask themselves how
could they have done that. What we really should have done when we
found this incredible wealth under the ground was to stop to ask
ourselves what can we do with this to provide the most good for the
most people for the longest time. That obviously is not what we did,
with no more responsibility than the kid who found the cookie jar or
the hog who found the feed room
[[Page H12448]]
door open. We have just been pigging out. And, incredibly, with all the
evidence that we are probably at or nearly at peak oil, we want to
continue doing that.
They keep asking me will I vote to drill in ANWR. No, I will not. I
have 10 kids, 16 grandkids, 2 great-grandkids. We, without my votes,
are going to leave them the largest intergenerational debt transfer in
the history of the world. Wouldn't it be nice if I left them a little
energy?
By the way, I will vote to drill there when they convince me they are
going to use all the energy they get from ANWR and offshore to invest
in renewables, because we have a huge challenge in developing enough
renewables.
The next chart, this is an interesting one. In September 2005, ``The
current price of oil is in the $45 to $57 per barrel range and is
expected to stay in that range for several years.'' It is now twice
that, more than twice of $45. Now, this is a very thoughtful group of
people that did this study, but they missed it, didn't they?
``The supply of oil is increasingly inadequate to meet the demand.
Oil prices may go significantly higher.'' Indeed they have. ``And some
have predicted prices ranging up to $180 a barrel in a few years. Who
knows?'' We assume we will be at $100 a barrel. How long will it take
to get to this $180 a barrel?
The next chart is an interesting chart. And what this shows is a
number of authorities, and we can get you this list, all these A to U,
nearly an alphabet of them, and when they have predicted peaking will
occur. Now, some of them are really uncertain. It could be now or any
time in the next hundred years. But most of them believe that it will
occur very soon or there is a probability it will occur very soon. So
there is wide, wide concurrence in the scientific world out there that
the peaking of oil is either present or imminent. And these four major
government studies, I don't have quotes here from a study done by the
National Petroleum Council. They have reached essentially the same
conclusions. And another one was done by the Government Accountability
Office. And all four of these said essentially the same thing: Peaking
is either present or imminent with potentially devastating
consequences.
The next chart is just a little schematic that shows the peaking
curve. By the way, you can obviously compress the abscissa and expand
the ordinate and make that a very sharp curve, or you can spread it
out, as we've done here, and make it a gradual curve. The significant
thing is that yellow area there represents 35 years. You see, at only a
2 percent increase in use, it doubles in 35 years. It is four times
bigger in 70 years. It is eight times bigger in 105 years, and it is 16
times bigger in 140 years. Well, no wonder a namesake of mine, and I
wish I was his relative, who really is a bright guy, Albert Bartlett,
says that the biggest failure of industrialized society is to
understand the exponential function. Albert Einstein in responding to
what will we find after nuclear energy, he said that the most powerful
force in the universe is the power of compound interest. And that's
what we see.
The next chart, and this is a really interesting one, shows on the
ordinate here how happy you are with your state in life, your sense of
well-being. What it shows on the abscissa here is how much energy we
use. Guess where we are. We use more energy than anybody else in the
world, and we're pretty happy about things. But notice that, I think,
20-some countries who use less energy than we, some of them less than
half as much, feel better about their quality of life than we feel
about ours. I put this slide up here to show you that we can use a
whole lot less energy and still live well, still be very satisfied with
our life.
The next one, and we need to come and start one of these 60 minutes
we have together and just focus on this chart, because this is the
future and this is where we are going. We will, of necessity,
ultimately transition from fossil fuels to renewables. When the fossil
fuels are gone, and one day they will be, the only argument is not
whether but when. And when they are gone, we will have transitioned
either smoothly because we chose the route or a really bumpy ride
because we didn't plan ahead.
There are some finite resources that we can use. The finite resources
include the tar sands, and previously you heard some discussion of the
tar sands. They are now producing a million barrels a day. That's a
lot, isn't it? But the world consumes 84 million barrels a day. We
consume 21 million barrels a day. So they are producing a little bit
more than 1 percent of the oil that the world uses, and they know that
what they are doing is not sustainable. They will run out of water.
They will run out of energy because they are now using stranded natural
gas. Stranded gas is gas that is somewhere where there aren't very many
people, and since it is hard to ship, they say it's stranded, and it's
cheaper. So they are using stranded natural gas there in this process.
What they do is have a big shovel that lifts 100 tons at a time. They
dump it in a truck that hauls 400 tons, and they haul it to a big
cooker where they cook it so that it is really stiff. All the volatiles
will come out of that because it's near the surface, and they cook that
until the oil flows, and then they add some solvents to it so it will
flow at normal temperatures. And if you think of the thing they are now
mining as a vein, that vein shortly ducks under an overlay so that they
are going to have to develop it in situ, and they have no idea how they
are going to develop it in situ. So the Canadians will tell you that
what they are doing is not sustainable. They might for a bit ramp up
and produce a little more, but ultimately it is certainly not
sustainable.
By the way, there is a huge, huge amount of potential energy in the
tar sands. One and a half times as much energy there as all the known
reserves of oil in the world. It is incredibly large. But let me note
to you that there is an incredible amount of energy in the tides. So
just because it is there doesn't mean it is in your gas tank, and just
like the tides, which are very difficult to harness, this has proved
difficult to harness.
What's even more difficult to harness are the oil shales. And we have
more in our West, roughly 1\1/2\ trillion barrels of oil. The world has
only about 1 trillion recoverable barrels of oil in all the world. So
we have one and a half times as much as all recoverable oil in the
world. Then why not rest easy? Because it is enormously difficult to
exploit. The Shell Oil Company was the last company that conducted a
major experiment there, and they aren't certain that it is economically
supportable to develop this. We put a lot of money in that in the 1970s
after the Arab oil embargo, and we still are a little closer to
exploitation of these shales than we were then.
Then there's coal. You've heard that we have 500 years of coal. That
is just flat out not true. A more correct statement until we knew
better was that we had 250 years of coal. But that's at current use
rates. The National Academy of Sciences has reevaluated the data. This
is not me saying it. This is the National Academy of Sciences, the most
prestigious scientific organization perhaps in the world. And they have
said that they have not looked at this data since 1970. That's a long
time ago. In relooking at the data, they say there is probably 100
years there. But let's look at what happens if there are 250 years
there. At a 2 percent growth rate, remember we talked about the 35
years it doubles, at 70 it is four times, 16 times bigger in 140 years?
That now shrinks to 85 years. And if you convert some of this, if you
use some of the energy to convert it to a gas or a liquid, it now
shrinks to 50 years. And it is inevitable that you will share it with
the world. Let me explain. If we are using liquids produced from coal,
we are not buying oil; so that means that oil is available to India and
China, isn't it? Energy liquid fuels are fungible. So it is inevitable
we will have to share it with the world because if we are not buying
the oil, someone else will. That 50 years then shrinks to 12\1/2\
years. And, by the way, if the real amount, as the National Academy
says, is 100 years, then that shrinks to about 5 years. So we have 5
years of coal at 2 percent growth to be converted to a gas or a liquid
and share it, as we must, with the world.
So for those who tell you rest easy, we have got this huge amount of
coal, not to worry, 250 years, that's at current use rates, and they
just do not understand what happens with exponential growth.
Now, back to the chart we were looking at.
[[Page H12449]]
{time} 1730
This really should be a separate category because nuclear is, if it's
the right kind of nuclear, totally sustainable.
There are three ways we can get nuclear energy. One is from the light
water reactor. All of the electrical energy in the world, I think, is
produced from light water reactors. France produces about 75 percent of
their energy; we, 19 or 20 percent of our electricity.
But fissure uranium is limited in the world. There is not enough to
meet all future demands. But then we can go to breeder reactors. The
breeder reactors do as the name implies, they produce more fuel than
they use. So that is kind of a forever thing. With that, you buy some
huge problems in transporting and enrichment. And you are hauling
around weapons grade material, and then you're having to store away the
end product for maybe a quarter of a million years. So although we have
the potential for a lot of energy from breeder reactors, that comes
with some big problems that we need to address.
Then there is nuclear fusion. We have a great fusion reactor; it's
called the sun. And it, by the way, is the source of almost all of our
present energy and past energy. All of the fossil fuels are there
because the sun was shining a long time ago to make the plants and
microbes and so forth grow. Well, we put about $250 million a year into
nuclear fusion. I suspect we are a little closer now than we were 15
years ago when I came to the Congress. By the way, I happily vote for
that $250 million because it's the only thing that gets us home free,
if we can find fusion.
If you think you're going to solve your personal economic problems by
winning the lottery, you're probably content that we're going to solve
our energy problems by developing fusion. I think the odds are roughly
the same. But because it is so incredibly important, because it gets us
home free, I happily vote for the roughly $250 million we spend there.
Then the renewables, solar and wind. I want to spend some time
talking about these.
I'm pretty sanguine about our future for electricity. We can produce
a lot of electricity by nuclear; France produces about 75 percent of
theirs. There are huge potentials from solar and wind. More solar
energy falls on the Earth each day than we use all year long. It may be
in less time than that that it falls on the Earth; it's an incredible
amount of energy. The big problem, of course, is harnessing that
energy. It is, by the way, the sun that makes the wind blow. The wind
blows because there is differential heating, and so it makes the wind
to blow. So all of this is kind of solar energy; wind, kind of
secondhand solar energy.
The problem with solar and wind is the sun doesn't shine all the
time, and the wind doesn't blow all the time. But we have a pretty
constant demand for energy, so you've got to store it. And this is a
huge challenge. And if you're talking about running your car on
batteries, then you have to think, but, do we have the raw materials
necessary for making enough batteries to run all the millions of cars
in the world with batteries? I think we could produce enough
electricity to do that. I'm not at all sure that there is enough raw
materials out there to make the batteries necessary for these cars.
Then there is geothermal. I'm not talking about the heat pump that
you tie to groundwater or ground temperature, which really, by the way,
is what you ought to do. If you think about your heat pump, in the
summer it's an air conditioner. It has to warm the outside air. It may
be 100 outside, no matter. The heat pump has to increase the air, that
temperature, in order to decrease the temperature in your house.
And in the winter time, what is it trying to do? When it's 10 degrees
outside, the heat pump has to make it even colder outside so it can
make you warmer inside. The 56 degrees, which is what it is here, looks
awfully cool in the summer time, doesn't it? And awfully warm in the
winter time. As a little boy, I was confused about how the spring house
we had on our farm could be so warm in the winter time and so cool in
the summer time. Of course when I went to school, I kind of figured
that thing out.
Ocean energy. I mentioned an incredible amount of energy in the
ocean, but harnessing that energy is a difficult thing. The waves and
the tides represent, by the way, the tides are produced by the movement
of the Moon, of course. That's an exception to energy produced in the
past or now from the sun.
But the challenge there is that because this is so spread out, it's
so difficult to harness. A good axiom is that energy, to be effective,
must be concentrated. And, boy, is it concentrated in gas and oil and
coal, just an incredible amount of energy there. Both the quantity and
the quality of that energy is superior to anything that we can produce
to take its place.
Now, agricultural resources, and this is an area, let me flip to the
next chart. Let's look at corn.
Earlier this evening you heard quite a discussion of ethanol and its
potential. And I don't want to quote Roscoe Bartlett here; I want to
quote the National Academy of Sciences here. They did a study, and they
concluded, and this was an article that appeared, I think, was it The
Washington Post, and they said that if we took all of our corn for
ethanol and discounted it for the fossil fuel input, which they said
was 80 percent, by the way, some people think that we use more energy
producing corn than we get out of the ethanol from corn; but even if
it's 80 percent, and that's a realistic number, I think, if we used all
of our corn for ethanol, no tortillas, no fattening of pigs and
chickens from corn, used it all for ethanol, it would displace only 2.4
percent of our gasoline.
Now, if you just start with the corn and ignore the energy it took to
produce the corn, then you get a whole different figure. So you need to
be careful when people are talking to you about energy from ethanol.
You know, the sun gratuitously produced that energy that put the oil in
the ground; it doesn't gratuitously grow our corn.
We put huge amounts of fertilizer, this lower pie chart shows that
nearly half the energy that goes into producing corn, and not one
person in 50 outside of the farmer knows this, almost half the energy
that goes into producing corn comes from the natural gas from which we
make the nitrogen fertilizer. Nature does this, by the way. You may
notice that your lawn is never as green watering it as it is after a
thunderstorm; we used to call it ``poor man's fertilizer.'' The
nitrogen in the air is converted by the lightning into a forum which is
carried down into the ground. That's fertilizer by the rain.
This is their data. The National Academy of Science said if we use
all of our corn for ethanol and discount it for fossil fuel, a little
silly, something to burn the fossil fuels in another forum, which is
corrosive, you can't put it in our pipes. You have to add it pretty
much at the last minute because we don't have the infrastructure to
move ethanol around. They wisely noted that if you tuned up your car
and put air in the tires, you would save as much oil as using all of
our corn to produce ethanol.
They then noted if we use all of our soybeans for diesel fuel, soy
diesel, all of it, no soybeans exported to China, which was, a few
years ago, our largest dollar export, by the way, because tofu, bean
curd, as they call it, is the energy staple of the Orient, none of
that, if we used all of our soybeans for soy diesel, it would displace
2.9 percent of our diesel.
Now, there are, I think, 70 million acres of corn, 60 million acres
of soybeans planted on our best soil, pampered with fertilizers and
pesticides and insecticides. And we would get, if we used it all for
energy, 2.4 percent of gasoline and 2.9 percent of our diesel would be
displaced.
Now, how much energy should we expect to get from weeds and switch
grass and trees? I don't know. But I suspect that it's going to be
difficult, sustainably, to get huge amounts of energy there because
today's weeds and so forth are growing in large measure because last
year's weeds died and are rotting and fertilizing them.
When you take the growth away from the rain forest, which looks like
an incredibly wealthy environment in terms of nutrients, you leave
laterite soils that will hardly grow anything because most all of the
nutrients were in the plants that were growing.
The Department of Agriculture came to me and they were hyping
cellulosic
[[Page H12450]]
ethanol. And I asked them, Are our topsoils increasing in quantity and
quality? And the answer is no. Then I said, Pray tell, how are we going
to get these enormous amounts of energy? Because topsoil is topsoil.
Because of humus, humus is the material from plants that grew yesterday
and are rotting today. It holds nutrients; it holds water. For every
bushel of corn we grow in Iowa, three bushels of topsoil go down the
Mississippi River. In spite of our best practices, it used to be many
bushels, by the way. In spite of our best practices, three bushels
still go down the river.
We will certainly get something. What if we got four times as much,
which is unlikely, from our wasteland and woods and so forth, as we can
get from all of our corn and all of our soybeans? That would be roughly
20 percent. Exploiting. Now, this would not be sustainable. You might,
for a few years, mine the topsoil and take off this biomass, but by and
by you will pay for that because you will no longer have the same
quality or quantity of topsoil.
The next chart has a little pie chart on it, which is really
interesting. We're a little bit like the couple whose grandparents have
died and left them a big inheritance and they have now established a
lifestyle where 85 percent of the money they spend comes from their
grandparents' inheritance and only 15 percent from their paycheck. And,
by golly, the grandparents' inheritance is going to run out before they
retire. So obviously they've got to restructure their lives; they have
to make more or spend less, or some combination of that. That's where
we are as far as energy is concerned. Eighty-five percent of our energy
comes from natural gas, petroleum and coal. A bit more than half of the
remainder comes from nuclear power.
And here are the true renewables over here. This is an old chart,
several years old.
I appreciate the opportunity to address the House. And we will return
shortly to talk more about these very important subjects.
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