[Congressional Record (Bound Edition), Volume 154 (2008), Part 5]
[House]
[Pages 6306-6312]
[From the U.S. Government Publishing Office, www.gpo.gov]




                                PEAK OIL

  The SPEAKER pro tempore (Mr. Altmire). 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, if Thomas Jefferson could be 
resurrected today, he would be surprised by many things that he found. 
As my good friend from Texas just indicated, he would be enormously 
surprised by the size of our Federal Government, because he had 
envisioned a country in which we had a very limited Federal Government.
  But there is something else that I remember about Thomas Jefferson 
that would really surprise him today. What he wanted for his new 
country was a largely agrarian society, with just enough cities to 
provide the manufacturing necessary to sustain an agricultural economy. 
He wanted this, he said, because he didn't want his new country to be 
blighted by the decadence of cities, as were the countries of Europe 
and the British Isles that they came from. He really, really would be 
quite surprised if he could be resurrected and come to our country 
today, wouldn't he, where far, far more than half of our people live in 
cities far larger than any he could have imagined at that time.
  Mr. Speaker, this, I believe, is the 42nd time that I have come here 
to the floor to talk about energy and primarily about oil. The first 
time I came here was a little over 3 years ago. Oil was just over $50 a 
barrel then, and I was talking about a history that, had we paid 
attention to it, would have told us that today, or sometime roughly 
near this, we would be here with oil at $115 a barrel, that is what it 
touched in Asia overnight, and with gasoline at the pump out there 
averaging somewhere near $3.50 a gallon.
  It was absolutely inevitable that we would be here. It was predicted 
that we would be here. And with all of these warnings, we really should 
have been doing something about that, and why we weren't is a very 
interesting subject.
  There were two speeches given on energy in the last century that I 
think will be increasingly recognized, one of them as the most 
important speech given, and the other one the most insightful speech 
given.
  I have here a quote from what I think was perhaps the most insightful 
speech given on energy. It was a speech given by Admiral Hyman 
Rickover, the father of our nuclear submarine, to a group of physicians 
in St. Paul, Minnesota, on the 14th day of May, 1957.
  He says, ``In the 8,000 years from the beginning of history to the 
year 2000 A.D.,'' he was looking ahead, ``world population will have 
grown from 10 million to 4 billion.'' He really missed that, didn't he? 
It is nearly 7 billion. He really had a pretty good concept of what 
energy was doing for us, but he had underestimated the contribution 
that energy would make to the growth of our population, because we are 
now somewhere near 7 billion people, with 90 percent of that growth, 
more than 90 percent, taking place during the last 5 percent of that 
period, in 400 years. It took the first 3,000 years of recorded history 
to accomplish the first doubling of population, 100 years for the first 
doubling, but the next doubling will require only 50 years. And, of 
course, it required less than that, because we are now far more than 
doubled.
  The next chart kind of depicts what Hyman Rickover was talking about. 
What this shows is the last part of that 8,000 years of recorded 
history. We have here only about 400 years of it. But if you went back 
the rest of the 8,000 years, the graph would look about the same. The 
production of energy was down there so near zero that it looked like it 
was on the zero line.
  Here we see the beginning of the Industrial Revolution. It began with 
wood, of course. That is the brown line there. Then we discovered coal 
and we produced considerably more energy. Then we discovered gas and 
oil, and, boy, it shot up. Now, if I had a curve of the growth in 
population, it would just track almost precisely this curve in the 
increase in energy available.
  This is an interesting curve, and I would like to spend just a moment 
looking at it. It is a very steep curve. Now, we can make this curve 
much less steep if we spread out the abscissa and compress the 
ordinate, and a little later we will have some curves that are that 
way. But you can still see the essentials of what this curve shows you.
  Here is the oil price spike hikes of the seventies. You will see it 
resulted in a worldwide recession that actually reduced the use of oil. 
And now, after recovery from that recession, with a great deal more 
respect for efficiency, we are now increasing our use of energy at a 
very much lesser slope.
  Now, in this chart where we have such a compressed abscissa, that is 
not as evident. It will be later. Later when we come to that I will 
point to the fact that this very steep curve, were it to have 
continued, we would be off the top of the chart and we would be in 
considerably more trouble relative to energy than we are today.
  The next chart is another quote from this great speech that Hyman 
Rickover gave a little over 50 years ago. ``There is nothing that man 
can do to rebuild exhausted fossil fuel reserves.'' When they are gone, 
they are gone. You can't recycle energy. When it is used, it is gone. 
They were created by solar energy a very long time ago, he says 50 
million years ago. It took eons to grow to their present volume.
  In the face of the basic fact that fossil fuel reserves are finite, 
the exact length of time--I want you to listen to this statement, so 
insightful--the exact length of time these reserves will last is 
important in only one respect. The longer they last, the more time that 
we have to invent ways of living off renewable or substitute energy 
sources and to adjust our economy to the vast changes which we can 
expect from such a shift.
  Fifty-one years ago. Tremendous advice. He recognized this. And he 
says we were living in a golden age. Exactly how long this golden age 
lasted would be only important in one regard. The longer it lasted, the 
more time we would have to shift to alternative sources of fuel, 
because fossil fuels, oil, gas and coal, are not infinite. They are 
finite. They will run out. The only question was not if, it was when 
will they run out. He said the longer they lasted, the more time we 
would have to invent ways of living off renewable or substitute energy 
sources.
  The world has done essentially none of that in the 51 years since he 
made that statement and gave that counsel. We have behaved in our use 
of fossil fuels as if they were in fact infinite, as if they would 
always be there. Tomorrow there will be another huge find, and we can 
just go on using as much energy as we wish for as long as we wish.
  The next chart is another quote from Hyman Rickover. ``Whether this 
golden age will continue depends entirely upon our ability to keep 
energy supplies in balance with the needs of our growing population.'' 
And oil is $115 a barrel and gas is $3.50 a gallon at the pump because 
we have not been able to keep energy supplies in balance with the needs 
of our growing population and our growing economies in this country and 
around the world, and we now have an imbalance between supply and 
demand. The demand is greater than the supply, and whenever that 
happens, of course, the price goes up, and the price has gone up.
  The next chart is a quote from one of four studies that have been 
paid for by your government and have been pretty much ignored by your 
government. All four of these studies have said essentially the same 
thing, that peaking of oil is either present or imminent, with 
potentially devastating consequences, and we really need to be doing 
something about that.
  The Corps of Engineers was one of those studies, the second one, in 
September of 2005. An earlier one, the Hirsch Report, was in February 
of 2005.

[[Page 6307]]

 Then last year there were two more reports, one by the Government 
Accountability Office, and the other by the National Petroleum Council.
  Oil, they said, is the most important form of energy in the world 
today. Historically, no other energy source equals oil's intrinsic 
qualities of extractability, transportability, versatility and cost. It 
has been really cheap. One barrel of oil represents the work output of 
12 people working all year, 25,000 man-hours of effort.
  When I first saw that statistic, I said, gee, that can't be true. 
Then I thought about it, how far that gallon of gas, still cheaper than 
water in the grocery store, carries my Prius; about 47-48 miles.

                              {time}  1600

  I know I could pull my Prius 47, 48 miles with a come-along and using 
guardrails and trees and so forth. How long would it take me to pull my 
Prius 47 miles?
  Certainly it is true that historically no other energy resource 
equals oil's qualities. Its quality of energy and the quantity of 
energy in these fossil fuels, particularly, oil is just incredible. 
That's one of the big challenges we face in finding alternatives for 
these fossil fuels is something that has the quality and the quantity 
of the energy in these fossil fuels.
  The next chart is a cartoon that asked the question ``Just why is gas 
so expensive?'' You can see here a tiny little supply and a huge 
demand, and that, of course, is why oil is so expensive. It's because 
the demand exceeds the supply.
  This problem is an even more demanding problem than just a supply and 
demand, because as the next chart shows us, the major supplies of oil 
come, as the President said in one of his State of the Union messages 
from countries that don't even like us, this is a chart which shows 
what the world would look like if the size of the country was relative 
to how much oil it had in the ground.
  You see here that Saudi Arabia dominates the landscape. Saudi Arabia 
represents about 22 percent of all the reserves of oil in the world, 
and you see how large the reserves are in countries like Iraq and tiny 
little Kuwait and the United Arab Emirates. You almost have to have a 
magnifying glass to see them, they are so small. Look how huge they are 
relative to oil, then Iran huge. Russia, just a couple of days ago, 
Russia had indicated that had they had reached a maximum capacity for 
producing oil.
  The United States, we have 2 percent of the known reserves of oil in 
the world. We use a fourth of the world's oil. What I really would like 
to focus on is the size of India and China over their more than a third 
of the world's population, and they have less oil than we have, and we 
have only 2 percent of the known reserves of oil in the world.
  The next chart has this in some numbers, and these numbers inspired 
30 of our prominent Americans, Jim Woolsey, McFarland, Boyden Gray and 
27 others to write several years ago a letter to the President saying, 
Mr. President, the fact that we have only 2 percent of the world's oil 
reserves, and we used 25 percent of the world's oil and import almost 
two-thirds of what we use is an almost totally unacceptable national 
security risk, and we really have got to do something about that. 
That's true that this represents a huge national security risk.
  This was recognized in our next chart by the Secretary of State in a 
comment that she made before a Senate committee just a bit over 2 
years, April 5, 2006. ``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 politics of the way 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.'' In that all-out rush, China is scouring the 
world and buying up oil reserves wherever they can find them.
  The next chart looks again at the geopolitical picture. Why is oil 
just so expensive? Many people believe that OPEC is gouging us. Others 
believe that our oil companies are gouging us.
  The truth, of course, is that the price of oil is determined by the 
relationship between the supply of oil and the demand for oil.
  Our large companies and the countries that are producing oil just 
happen to be happy recipients of this confluence of events which 
demands more oil than is available and so the price is up.
  What this chart looks at is the top 10 of the oil and gas companies 
on the basis of how much oil they have. You see that 98 percent of 
these top 10 are all countries, they are not companies.
  Most of the oil in the world is not owned by companies, it's own by 
countries. LUKOIL, which is kind of an independent oil company in 
Russia, is only 2 percent at the top of this bar.
  The bar here looks at the top 10 oil and gas companies on the basis 
of production. Now, we have huge oil companies. ExxonMobil, the largest 
one in the world, Royal Dutch/Shell, BP, collectively, they produce 
only 22 percent of the oil, and these state-owned fields produce only 
78 percent of the oil.
  The next chart I mentioned, China's interest in scouring the world 
and looking for oil, wherever you see a dollar sign on this chart, we 
have bought some oil. Here I see a dollar sign here, I see a dollar 
sign, not very many of them. When you see this little Chinese symbol 
kind of a sign here that's where China has bought oil.
  Here is one, they tried to buy Unocal in our country. You see their 
symbol all over the world. They are aggressively buying oil all over 
the world.
  In today's world it really doesn't make any difference who owns the 
oil, the person who has the dollars. It's an auction, a bidding 
process. The person who has the dollars buys the oil.
  Why would China be buying up oil if they simply come with the dollars 
and you buy all the oil they need on the world market? Well, it's hard 
to get inside another person's head, but it may just be that they are 
looking to the day when they will not be able to share their oil with 
the world.
  Now, all the oil in all the world is shared with all of the world. 
It's all a huge auction pool and everybody contributes and everybody 
buys. That happy day may end.
  The next chart. If you had only one chart to look at to inform 
yourself about where we are and what the challenge is, I think this 
would be the chart. This chart shows bars that represent the amount of 
oil that we discovered year by year. You see that we had huge, huge 
discoveries back in the 1960s and 1970s.
  Then from about the 1980s, I am really starting about the 1970s on, 
we progressively found, choppy up and down, but less and less and less 
oil. That's in spite of ever-better techniques for finding oil.
  The solid black line here represents the oil that we have used. Here 
is the 1970s, and notice the reduction in use there as a result of a 
worldwide recession brought on by the oil price spike hikes then.
  Now, this is an expansion of the abscissa--and I indicated earlier we 
would have a chart where there is a huge difference in slope. Remember 
we had that red one just going straight up. If we could compress this 
abscissa we could make that one go almost straight up.
  But notice how much less the slope is after the recession of the 
1970s. That's because the world woke up and said, gee, oil is 
expensive, isn't it, and we can do better, and let's be more efficient.
  The air conditioner you have today may be two or three more times 
more efficient, as is your refrigerator. We now have fluorescent 
lights, and they are very much more efficient than incandescent lights. 
So this lesser slope of the curve represents increased efficiency. Were 
it not for that, notice where we would be on the curve now, we would be 
off the top of the chart now, wouldn't we, if this kept going.
  By the way, I want to just make one observation about exponential 
growth. This is, of course, exponential growth. Albert Einstein was 
asked, Dr. Einstein, what will be the next big force we find after 
nuclear energy? His response, the most powerful force in the

[[Page 6308]]

universe is the power of compound interest.
  Just 2 percent growth, that's so anemic, that our market doesn't like 
it. It really kind of teeters, it stutters a little and doesn't grow 
with 2 percent growth. Things tend to be pessimistic, but 2 percent 
growth doubles in 35 years, it's 4 times bigger in 70 years, it's 9 
times bigger in 105 years and it's 16 times bigger in 140 years, just 2 
percent growth, compound growth. So if this compound growth had 
continued, this will be off the top of the page.
  That was kind of a trauma going through the 1970, but we really 
should look back on it and say how lucky we were that we had a wake-up 
call because look what happened? We got much more efficient, and so now 
we are in much less trouble than we would have been had we not had this 
chalk, and we would have continued along this curve.
  The next chart, the next chart is one from the U.S. Corps of 
Engineers. In general, all nonrenewable resources follow a natural 
supply curve, production increases rapidly, slows, reaches a peak and 
then declines at a rapid pace similar to its initial increase.
  The major question for petroleum is not whether production will peak, 
this is one of the four studies your government paid for and is now 
ignoring. It's not whether the production will peak but when. Oil is 
not infinite in its supply, it is finite. There is only so much.
  One day we will reach our maximum capabilities for producing oil. 
There are many estimates of recoverable petroleum reserves giving rise 
to many estimates of when peak oil will occur and how high the peak 
will be. A careful review of all the estimates leads to the conclusion 
that world oil production may peak within a few short years, after 
which it will decline.
  Once peak oil curves, then the historic patterns of world oil demand 
and price cycles will cease. They might have gone on to explain what 
that's going to do to our economy.
  The next slide--and I have to go back more than 50 years to put this 
in context--on the 8th day of March in 1956, the most important speech, 
what I think will certainly recognize will be the most important speech 
of the last century was given, and this speech was given by a Shell Oil 
Company scientist, M. King Hubbert, to a group of physicians in St. 
Paul, Minnesota.
  At that time, the United States was king of oil. We were producing 
more oil, consuming more oil and shipping more oil than any country in 
the world. What M. King Hubbert told them was that in 16 short years, 
14 short years, you are going to reach your maximum production of oil. 
He made that prediction in 1956. And sure enough in 1970, the yellow 
symbols here we reached our maximum production.
  Now, the actual maximum production was a little bit higher, it was 
the green squares there, and they tended to be a little bit higher 
going down the slope on the other side of Hubbert's peak. Some would 
have you believe the difference between M. King Hubbert's predictions 
the gold triangles and the oil that we actually pump indicate that he 
didn't really know what he was talking about.
  Well, it did peak in 1970, and it did go down after that. If you 
aren't a statistician, I think the average person would look at that 
and say, gee, he really got it pretty right didn't he.
  Now the red squares there on the other side represent the total 
amount of oil that we pump, because he had only predicted the lower 48, 
and we added huge amounts of oil from Alaska, a fourth of our total 
production for the last several years, and from the Gulf of Mexico. 
Even with those hugely large extra supplies, there was still just a 
blip in the slope down the other side of Hubbert's peak.
  Now the same person that predicted that the United States would be 
peaking in 1970. In 1979, he predicted that the world would be peaking 
about now.
  We have kind of blown, not kind of, we have blown the last 28 years, 
because by 1980, here we are in 1980, we looked back and, boy, M. King 
Hubbert was right about the United States. We did peak in 1970. In 
spite of drilling more oil wells than all the rest of the world put 
together, we have not been able to make a liar out of M. King Hubbert.
  Today we produce about half of the oil we produced in 1970. In the 
lower 48 we produce way less than half of the oil that we produced 
then.

                              {time}  1615

  Now in 1979 he predicted that the world would be peaking about now.
  The next chart has data from two entities in our world that are 
pretty good at tracking how much oil we pump and use. By the way, we 
use all we pump. There are no big reservoirs of oil waiting to be used. 
I would caution that I don't think these entities have the same 
fidelity in predicting how much more we will find in the future, but 
they do a very good job of tracking what we've used. This is the EIA 
and the IEA. The IEA is the International Energy Agency. You hear them 
referred to. They are the ones that are tracking what is going on in 
Iran with their nuclear thing. And the EIA is the Energy Information 
Administration and is a part of our own Department of Energy. Both of 
those have oil production plateauing; one of them for about 3 years, 
and the other for about a year and a half.
  What happens when demand keeps going up and supply stagnates? This 
price curve shows you what happens. We had a comfortable dip here in 
prices less than a year ago, but now they are skyrocketing, and $115 is 
off the top of the chart. We need to make a new chart to show where 
115.
  The question I ask myself and audiences is: If M. King Hubbert was 
right about the United States, which is a microcosm of the world, we 
did peak in 1970, and it is clear every year after that we have less 
and less oil, why wouldn't the United States be a microcosm of the 
world, and he predicted the world would be peaking about now, why 
wouldn't we have done something about that? Why have we continued to 
behave as if gas and oil and coal were forever, that they would never 
run out? What we want to do now is to rush out to our public lands to 
offshore, to ANWR, and to drill. I asked them, if you can drill ANWR 
tomorrow, what will you do the day after tomorrow? And there will be a 
day after tomorrow.
  I think about that. I have 10 kids and 16 grandkids and 2 great-
grandkids. They are going to be here the day after tomorrow. We are 
leaving them a huge debt. Check my voting record, it is not my fault. 
We are leaving them a huge debt, and I asked them, Wouldn't it be nice 
if we left them a little oil. And they smile, and the next thing they 
are asking, Would you vote to drill in ANWR. No, I won't. Or on our 
public lands or offshore until you commit to me that you will use every 
bit of energy you get from those sites to invest in alternative energy 
because we have now run out of surplus energy. If we had any surplus 
oil, it wouldn't be $115 a barrel today, would it. So I will vote to 
drill there when I have a commitment that we will use all of the energy 
we get there and invest it in the development of alternatives.
  The next chart is a detailed chart of our production and decline. 
Here is what M. King Hubbert predicted of Texas and the rest of the 
United States. And then we have learned to get some gas from natural 
gas liquids, a huge find in Alaska, a big find in the Gulf of Mexico, 
just a blip in the slide down the other side of Hubbert's peak.
  The next chart shows some projections of what we will find in the 
future. Although with really good techniques and a lot of energy, we 
have gone out there, a lot of incentives, we have looked for the last 
remaining oil deposits and we have found less and less and less as time 
goes on. What this curve does is smooth out the big bars we saw before. 
Here we are at this point. They were projecting how much more we were 
going to find. We don't have time, but there is a really interesting 
metamorphosis that took place here.
  The USGS, in trying to predict how much more oil we would find, has 
several computer models. They put different data into those models, and 
they get different results out. They have run many simulations, and 
they put all of those simulations on a chart and they get the mean of 
the simulations. They

[[Page 6309]]

think that they are putting in good data and so they should be getting 
out good data. They take the mean of those, and they say this is the 
most probable amount of oil we will find.
  Somehow that ``F'' for frequency, maybe it was a bad font, but 
somehow it showed up as a ``P'' or probability when it got to EIA. And 
then they make some bizarre applications of statistics.
  They say that the 50 percent probability, the green one here, which 
they say is the mean, and of course 50 percent probability is not a 
mean, it is 50 percent probability. They say the 50 percent probability 
is more likely than the 95 percent probability. Of course that defies 
logic in that it obviously is not more probable because the actual data 
points have been following, as you expect they would follow, the 95 
percent probability.
  I will say again: These two agencies, the IEA and the EIA do a really 
good job of tracking what we produce and use. I would be careful about 
accepting their prognostications of what we are going to find.
  The next chart is one from the first big study that I mentioned, one 
of the four that your government paid for and it is largely ignoring. 
This is called the Hirsch Report done by SAIC, a huge, international, 
very prestigious, scientific engineering organization.
  I have highlighted this phrase because it is so shocking. ``The world 
has never faced a problem like this. There is no precedent in history 
to guide us.''
  We have never faced a problem like this. You cannot go back in 
history and find any problem that will help you decide how you are 
going to get through this. The world has never faced a problem like 
this.
  The next chart. They say that the peaking of world oil production 
presents the United States and the world with an unprecedented risk 
management problem. They say that the economic, social and political 
cost will be unprecedented. Wow, strong words. The world has never 
faced a problem like this, unprecedented risk management problem. 
Nothing like it in history. Nothing to guide you. The economic, social 
and political cost will be unprecedented.
  The next chart is a schematic. This shows what we have been talking 
about, a 2 percent rate of growth, doubles in 35 years. The yellow 
there is 35 years. I think we are about here. Notice the shortfall 
occurs a little before peaking, although the IEA and the EIA both have 
oil peaking, so we may be about at that point.
  Most people when they look at that chart say we have to fill that 
yellow space because we have to have all of the liquid fuels that we 
would like to use. I will submit, Mr. Speaker, that it is exceedingly 
unlikely that we will be able to fill that blank to make up for the 
deficit between what we would like to use and what will be available. 
Filling the gap, I think, is not feasible. And what Hyman Rickover 
cautioned 50 years ago, 51 years ago now, we should note today, and 
that is we need to plan in an orderly fashion to move from fossil fuels 
to sustainable renewables because geology will demand it. We will move 
when the oil is not there, when the gas is not there, and when the coal 
is not there. Then we will have moved to alternatives. Whether that is 
a bumpy ride or a really bumpy ride will depend on what we do now and 
in the immediate future.
  The next chart is a really interesting one because it shows us again 
this rapidly accelerating use of oil, then the recession of the 1970s, 
and a lesser slope after that. This chart assumes that we may find as 
much more oil as all the recoverable oil we now know exists. Most 
experts believe that roughly, at the end of the day, there will have 
been roughly two trillion barrels of oil pumped. We have pumped about a 
trillion barrels now. Most experts believe we have another trillion 
barrels to pump. This assumes that we are going to have a total of 
three trillion barrels.
  Now if we have one trillion barrels remaining of the two original, we 
have pumped one and if there is a total of three, that means that they 
are presuming that we are going to find another trillion barrels of 
oil. If we do that, by their own calculations it will simply move the 
peak out from around 2000 or a little after 2000 to 2016. That is not 
very far. That is the effect of exponential growth.
  During the Carter years, every decade we used as much oil as had been 
used in all of previous history. That is a stunning statistic. Thank 
goodness for those oil price spike shocks and the efficiency that 
resulted from that or else we would be in a really troubled world 
today.
  What that means is if you use as much each decade as you use in all 
of previous history, when you have used half of the world's oil, which 
is where we are, then you would have 10 years of oil remaining. We have 
slowed down so if you do those calculations, the 88 million barrels a 
day, a trillion barrels remaining, that comes out to roughly 30 years. 
It is not going to be 30 years of constant production and then fall off 
the cliff because it is going to be harder and harder to get, more and 
more expensive, and getting less and less each year no matter what we 
do.
  The next chart is a quote, very recent quote, January 22 of this 
year, by the CEO of Shell Oil, Royal Dutch Shell. ``By the year 2100, 
the world's energy system will be radically different from today's. The 
world's current predicament limits our maneuvering room. We are 
experiencing a step change in the growth rate of energy demand and 
Shell estimates after 2015, supplies of easy-to-access oil and gas will 
no longer keep up with demand.'' That may have already happened, as we 
noted from that former chart and as we see with gas over $10 and oil 
over $115 a barrel.
  ``As a result'' he says, ``society has no choice but to add other 
energy sources.''
  Have you noticed society doing that at any aggressive clip?
  The next chart, and I want to spend some meaningful amount of time 
looking at what are those alternatives. We are very much like the young 
couple whose grandparents have died and left them a big inheritance. 
The young couple has now established a really lavish life style. They 
are living it up. Eighty-five percent of all the money they spend comes 
from their grandparents' inheritance--coal, petroleum, natural gas--and 
only 15 percent of it comes from their income. Now they look at how old 
they are, they look at their grandparents' inheritance, and see it is 
going to run out before they retire. They have to spend less or make 
more. That's exactly where we are.
  Eighty-five percent of all of the energy we use is the equivalent of 
our grandparents' inheritance. We inherited it. It is there in the 
ground, coal, oil and gas. And only 15 percent of the energy we use is 
something else.
  Now this 85 percent is going away. We have reached the maximum 
production, and if the world is going to follow the model of the United 
States, no matter what we do, the production in the world is going to 
be less and less, harder and harder to get, more and more expensive. 
That has happened in our country. And in spite of drilling more oil 
wells than all of the rest of the world together, and in spite of 
having the best oil people in all of the world, we have not been able 
to make M. King Hubbert out to be a liar because we still today, with 
all of that technology, with 530,000 producing oil wells, we still are 
producing only about half of the oil that we produced in 1970.

                              {time}  1630

  Well, what are the alternatives? What will we be using at the end of 
this magnificent age of oil?
  And Hyman Rickover didn't know how long it would last. They were 
about 100 years into the age of oil. Oil had not peaked then. It 
wouldn't peak for another 50 years, 51 years or so, so he had no idea 
how long it lasted. But he said how long it lasted was important in 
only one regard; that the longer it lasted, the more time we would have 
to plan a rational transition from oil to other sustainable renewable 
sources of fuel.
  Well, here we are today, and what have we done?
  The President said in one of his State of the Union addresses that we 
are hooked on oil. We are indeed. And I

[[Page 6310]]

think that rushing out there to drill in public lands, to drill in 
ANWR, to drill offshore is exactly the equivalent of giving a dope 
addict another fix. As the President says, we really, really do have to 
wean ourselves from these fossil fuels.
  By the way, there are three groups out there that want to do this for 
very different reasons. One of those groups is the national security 
group that I mentioned that is really concerned that we have only 2 
percent of the oil, and use 25 percent of the oil, and import almost 
two-thirds of what we use. Our second largest importer now is Saudi 
Arabia. It was Mexico. They've fallen back. That really places us in a 
very precarious position.
  The President has indicated that we really must transition from these 
fossil fuels to renewables. What will they be?
  And here we have a brief listing, and I think that this subtends 
about all of the possible renewables. By the way, we get more than the 
non fossil fuel energy nuclear power. 8 percent of the 15 percent is 
nuclear. We get about 20 percent of our electricity from nuclear. It's 
down just a little. Now 19 something, roughly 20.
  The French get about 75, 80 percent. But we still produce more 
nuclear than France because we have a whole lot bigger economy than 
France has. We're the largest nuclear power producers in the world. 
That could and probably should grow. Only 7 percent in other 
renewables.
  The things that I'm very fond of are solar and wind. I have a place 
off-grid, and I have solar panels and I have wind machines and 
batteries for storage, and so I'm a huge fan of solar and wind.
  But these were 1 percent of 7 percent in 2000. They're really 
growing, growing maybe 30, 40 percent a year. That's huge growth. So 
they're four or five times bigger. .28 percent, big deal because this 
is only .07 percent. So these things that will be important sources of 
energy in the future are now very small, growing; rapidly, but still 
very small.
  Wood, this is the paper industry and the timber industry wisely using 
what would otherwise be a waste product, and there's not a huge 
potential for growth there without doing what North Korea, has done, 
for instance. They're just cutting down their forests.
  Waste energy, that's very popular. And there's a great facility up 
here in Northern Montgomery County. I've been by. I would be proud to 
have it by my church. It looks really nice. The waste comes in in big 
containers and in railroad cars and I don't even see it. And they 
handle it very well. I didn't even smell it when I was there.
  But I want to caution that this huge waste stream is the result, 
largely the result of profligate use of fossil fuels. Look at it. 
Almost everything in that waste stream was the result of using oil, gas 
or coal. It's a really great idea now. Recycle what you can, burn 
what's left, better than burying it in the ground somewhere. But that's 
not a silver bullet, not a solution to our problem because in an 
energy-deficient world, this is really going to shrink because the 
energy just isn't going to be there to create all this waste.
  Conventional hydro. Huge. We've tapped out on that in our country. 
We've probably dammed up some rivers we shouldn't have dammed up. But 
some people believe we could get as much from micro hydro. There's some 
really good small pelt wheels and turbines and so forth.
  Alcohol fuel. 1 percent back then. Now, we've had a huge push for 
alcohol fuel.
  There have been two big bubbles that have broken, two big hopes. One 
of them was the hydrogen economy. You don't hear very many people 
talking about it anymore. I think it's probably sunk in that hydrogen 
is not free for the having. There's no place you can go, like you can 
go for coal or gas or oil and drill a hole and get hydrogen.
  You get hydrogen by using one energy source, using another energy 
source to create the hydrogen. You split water, or you use electricity, 
or you get it from natural gas. But you will always use more energy 
getting the hydrogen than you will get out of the hydrogen. That's the 
second law of thermodynamics. And if we can violate that law, why we 
can set aside the law of gravity, and then we won't have the kind of 
problems that we have today with energy, will we? That's an inviolate 
law that won't change.
  So why are we talking about hydrogen if you will never get as much 
energy out of the hydrogen as it took to make the hydrogen? For two 
reasons. One, when you finally burn it, the product you get is the 
oxide of hydrogen. It's burned hydrogen. We call it water. When you 
look at water, it's burned hydrogen is what it is. And it's really 
clean, isn't it?
  And the second thing is it's a great candidate for a fuel cell, which 
is probably at least two decades off. So you don't hear much talk about 
hydrogen. It may 1 day be an important part of our energy economy, but 
that day must await, I think, the development of the fuel cell because 
if you're simply going to put hydrogen in a reciprocating engine, why 
wouldn't you put the fuel from which you made the hydrogen in your 
reciprocating engine and save that fuel loss in the transition?
  The second big bubble that broke was the corn ethanol bubble. And I 
really had high hopes for this before I did some back of the envelope 
computations, because I saw our farmers who were getting too little for 
their crops, huge energy represented in these crops, and I think they 
will make a meaningful contribution to our energy future. But not in 
the dimensions that were anticipated for corn ethanol.
  The National Academy of Sciences, and this isn't Roscoe Bartlett, 
this is National Academy of Sciences, although my back of the envelope 
computations came to the same conclusion. The National Academy of 
Sciences says if we use all of our corn for ethanol, every bit of it, 
use all of it for ethanol, and discounted it for the fossil fuel input, 
which is huge, in fact, some people believe if you really cost account 
all the fossil fuel energy that goes into producing ethanol, more 
energy goes in than you get out of this. They were using 80 percent, 
which is probably not bad; that that would displace 2.4 percent of our 
gasoline. That's all of our corn, displace 2.4 percent of our gasoline.
  They noted wryly that you could save as much gas if you tuned up your 
car and put air in the tires. And by the way, you would save half your 
gas if there was two people in every vehicle out there instead of one 
which is in most vehicles. You would save half your gas if your vehicle 
got 40 miles per gallon, rather than 20 miles per gallon, both of which 
are very doable with a little planning and buying the right car, by the 
way.
  I think was 2 or 3 days ago there was a major headline above the fold 
in the New York Times saying that Third World leaders were complaining 
to us that we were starving their people because the high price of corn 
incented our farmers to shift land from wheat and soybeans to corn. 
That drove up the price of wheat and soybeans. There have been some 
problems producing rice around the world and, anyway, these commodities 
tend to more together. So the four basic foods of the poorest people in 
the world, they said, have been driven up drastically, essentially 
doubled in price, because we're making corn ethanol.
  Hyman Rickover, by the way, I don't have that quote here but please 
do a Google search for Rickover and energy speech, and it'll pop up. He 
cautioned that you probably shouldn't be eating your food. 51 years 
ago. Maybe we should have listened.
  Geothermal. That's true geothermal. That's not hooking your heat pump 
to ground temperature, which is a really good idea. If you think about 
what you're asking that heat pump to do this winter, if it wasn't 
hooked to ground temperature, you were asking it to cool the outside 
air, which might have been 10 degrees, so that it could warm up your 
air in the house. That's what you're doing.
  How much easier its job would have been if it had been looking at 56 
degrees, rather than 10 degrees, because 56 degrees is what ground 
temperature in here, it's mean annual temperature, it's what the water 
is that comes out of the wells.

[[Page 6311]]

  Now, this summer, if you have an air conditioner in your window, and 
it's not a heat pump tied to the ground, what that air conditioner is 
going to be trying to do is heating up the 100 degree air outside so it 
can cool your house inside. Pretty tough job.
  But if you had tied that air conditioner to ground temperature, now 
it's looking at 56, which looks really cool, compared to 100, doesn't 
it?
  I didn't understand this phenomenon as a 7-year old, and I grew up 
without electricity and an inside toilet on a farm, and we kept our 
food in a spring house. And I thought there was something magic in that 
spring house and I didn't understand it, but I knew it was magic 
because I went in that spring house in the summertime and it was so 
cool. And I went in that spring house in the winter time and it was so 
warm.
  Of course, when it was 100 outside, that spring house, which was 
maybe 65, that was Pennsylvania, it'd be a little colder than here, 
maybe 60 or so, that really seemed cool. In the winter time 60 seemed 
really warm compared to the zero or 10 degrees outside, so I thought 
there was something magic in that spring house.
  The next chart takes a little deeper look at some of our 
alternatives. Now, we do have some finite resources, and we can exploit 
those, and we will exploit those, and we should exploit those, but they 
are finite. Some of them are huge.
  The first of these are the tar sands in Canada. They are huge. 
There's as much potential oil in those tar sands as there is in all of 
the known reserves of oil in the world, more actually.
  So why aren't we euphoric over that? It's because it's very difficult 
to get.
  The Canadians are now using natural gas, which will run out. They're 
pumping water, which will run out. They're creating a huge tailings 
pond, which is kind of an environmental disaster, and they're producing 
a million barrels a day. That's a lot. It's a little over 1 percent of 
what the world uses. We use about 88 million barrels a day.
  But they know it's not sustainable because they're going to run out 
of gas, they're going to run out of water, and what they're now 
exploiting is kind of on the surface, and it will soon kind of duck 
under an overlay, so they have to develop it in situ, and they aren't 
quite sure how to do that.
  So there's a huge amount of energy there, potential. But there's also 
a huge amount of potential energy in the tides. The moon lifts the 
whole darned ocean 2 or 3 feet. That's a huge amount of energy.
  But, you know, getting that in your gas tank is quite another thing. 
Energy, to be effective, must be concentrated, and in the tides it 
certainly isn't concentrated.
  Now in our west we have oil shales, and they are really huge, maybe 
even bigger than the tar sands in Canada. Nobody yet is commercially 
exploiting those. There are some vigorous attempts today, and there may 
be some exploitation of those. There's at least a trillion barrels, 
maybe a trillion and a half, two trillion barrels there. And different 
experts differ on how much of that may be recoverable. But, again, 
because it's there, it's not in your gas tank, we will recover some of 
that.
  As oil goes up, Goldman Sachs says by the end of the year it could be 
150, $200 a barrel. Who knows?
  The more expensive oil gets, the more sources there are of oil 
because you can now use oil which would have been prohibitive in cost 
with oil at lower prices.
  Coal. I know a lot of people who say, don't worry about the future; 
we have sure supplies of coal. We have 250 years of coal, at current 
usage rates.
  Be very careful, calibrate what people say when they tell you at 
current use rates. Now, if we had 250 years of coal, and we don't, I'll 
come to that in a moment. But if we had 250 years of coal at current 
use rates, if you increase that use only 2 percent, that's not much, we 
will have to do more than that. But if you increase it only 2 percent 
it shrinks to 85 years. The power of compound growth.
  And if you use some of the energy coal to make it a gas or a liquid, 
because you can't put coal in the trunk of your car and go down the 
road, it now shrinks to 50 years.
  And when one other observation. We have no alternative but to share 
it with the world. Let me tell you why. Because if we get oil from 
coal, we're then not buying some Saudi oil, which somebody else can 
buy, so it has the exact effect of sharing it with the world. That is 
inescapable. There is no way to avoid that.
  So now that 50 years, since we use a fourth of the world's supply, 
and that 250 years was at current use rates for us in this country, not 
the whole world, now that 50 years, divided by four, shrinks to 12\1/2\ 
years. So if we had 250 years of coal and we increased its use only 2 
percent, converted it to a gas or a liquid and shared it with the 
world, and we have no alternative, it'll last 12\1/2\ years.

                              {time}  1645

  But the National Academy of Sciences says we haven't looked at the 
coal reserves since the 1970s and they believe there is more like 100 
years at current use rates. So that 85 years and 50 years now shrink to 
something roughly half of that, and the 12\1/2\ years sharing it with 
the world may shrink to something like 5 or 6 or so years sharing it 
with the world.
  The coal is there. It is huge. But our use of energy in the world is 
huge, huge. Eighty-eight million barrels a day, each barrel having the 
energy equivalent of 12 people working all year. That's an incredible 
amount of energy. Just look at the road you travel home on tonight and 
see the cars there, and that's replicated 1,000 times in our country 
and thousands of times around the world.
  I was in Beijing a little while ago and they banned bicycles in parts 
of Beijing. There is no room for them. So many cars on the road. I was 
late to an appointment in Beijing because of traffic jams, late to an 
appointment in Moscow because of traffic jams there. I was there in 
1973, and the streets were almost devoid of cars. You saw a military 
vehicle now and then. That's all you saw then. A whole different world 
now.
  Well, there's nuclear, and we now get 8 percent of our total energy, 
almost 20 percent of our electricity from nuclear that could and 
probably should grow. But the nuclear we're now using, which is 
whitewater reactors using fissionable uranium is limited because there 
is a limited supply of fissionable uranium. That won't last forever.
  There are breeder reactors. Nobody uses them for energy production. 
The breeder reactors, as the name implies, make more fuel than they 
use. You buy some problems with those, like you have to enrich the fuel 
and it's weapon's grade stuff and you have to move it around and 
there's challenges for terrorists getting it and such; but you get 
energy from it.
  Then there is the only silver bullet that gets us home free, and that 
is nuclear fusion. I happily vote for the roughly $250 million a year 
that we spend developing that. We're joining with other countries in 
helping to develop that. I think the probability is low that we will 
ever be able to exploit that on a commercial scale.
  Now, if you're sanguine believing that we're going to solve our 
energy problem with nuclear fusion, you probably think you can solve 
your personal financial problems by winning the lottery. You might do 
it. But the odds of you solving your personal financial problems by 
winning the lottery are about the same as our solving our energy 
problems by using fusion.
  But because it is such an incredible source, the only thing that gets 
us home free, I happily support, and I would support more money if we 
had more skilled people out there who could be looking at this.
  The next big bubble that we're talking about now is biomass, and I 
would caution, how much more energy you think that we can get from 
wastelands out there that aren't good enough to grow corn and soybeans 
on, that we could get from all of our corn and all of our soybeans?
  I would like to take the last couple of minutes to note a couple of 
things that we have been doing.

[[Page 6312]]

  I have a bill, and this is going to give a prize to the first farm 
that can be totally energy independent. If our farms can't be energy 
independent, we're really in trouble, aren't we?
  The next chart is a bill, the Drive Act. That will encourage the 
development of vehicles that are more efficient that are flex-fuel. You 
can use any fuel. Not corn ethanol, but any of the alternative fuels.
  I would just like to note that I find this whole challenge 
exhilarating. There is no exhilaration like meeting and overcoming a 
huge challenge. I spent some time going over these potential 
alternatives. I just want realistic expectations. There's no silver 
bullet out there. It's going to be a little of this and a little of 
that. And America is very good at that.
  What we need in this country is a program that has a total commitment 
of World War II. I lived through that war. I'll be 82 years old on my 
next birthday, about 6 weeks from now. I lived through that war.
  We need the technology commitment that we had when we put a man on 
the moon, that focus, and we need the urgency of the Manhattan Project. 
And I think that Americans are up to this challenge. I think we can 
lead the world in developing the technology to take us away from the 
fossil fuels to these other sources of energy.
  The next chart I have already gone through. I will indulge for just a 
moment with the last chart. This is a great one to end on.
  Mr. Speaker, this is a chart that shows how satisfied you are with 
life and how much energy you use. There are 22 countries, some of them 
using half the energy that we use that are happier with life than we 
are. There's lots and lots of opportunities out there to live really 
well using less energy, and that's our challenge, and with proper 
leadership, America is up to it.

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