Sunday, August 10, 2008

The Price of Gas and Alternatives to Petroleum

Gas climbed to all time high's this summer and now it is dropping. The news is saying things like the oil speculation bubble has burst or with foreign markets slowing, the dollar's strengthening again. Some talk as if the end of high costs are gone for good.

Well, they aren't. I predict that at this time next summer, Gas will cost a little bit more than it did this time around. It might not climb as quickly as it did this year but the general trend year over year is that the price will continue to to rise. Something dramatic would need to change in the market for the price to truly drop and stay down.

And how do we solve the energy problem in America? A lot of people are calling for allowing the oil companies to drill on more of our lands. That will do nothing to the price at the pump in the short term, and after the five years or so it takes to find the oil and build the platforms to drill for it, it will be too little too late for most people. And the only people who will gain from this is the oil industry. I think they're rich enough already.

Petroleum is a finite resource, I think it would be wiser to deplete other country's oil deposits first and then when we are well past the peak oil point (and some think we may be already), we will be one of the few places left with it.

Other people are calling for research in alternative technologies, funded by taxpayer money. I see that money ending up in the hands of oil companies or companies owned by oil companies to fritter tax payer money away in researching technologies that will never get sold or marketed, like hydrogen fuel cells.

What I think would be better would be to provide tax incentives to the consumer to purchase those alternative technologies, some already exist and others would become economically viable with the reduced cost of entry. Let natural market forces dictate which technologies get used. The good ones will survive and the bad ones will fail. Handing a big company a big check for research won't ensure that the technology reaches consumers. Now if that big check went to the consumer, then the companies that deserve it will get the money in the end.

People keep talking about electric cars as if they are still ten years in the future and the battery technology isn't here yet. The technology has been here for at least the last ten to twelve years. The GM EV1, Ford Think, Toyata RAV4 EV, Honda EV Plus, Chevy S10 EV, and Ford Ranger EV, all worked in the late 199os. A handful of Toyota RAV4, S10, and Ranger EVs are still being driven in California, mostly by utility companies and government research groups.

The Tesla Roadster is now in production and rolling out of the factory and into people's homes. The Aptera and Venture One will not be far behind. People all over the country have converted existing gas powered cars to electric. You can see them here. Whoever says that the technology isn't ready for electric cars must still be stuck in the year 1988 instead of 2008. I would have my own electric car already if I had a little more money for such a project.

We can kick the habit of oil today if we really want to. The American southwest has the space and days of sunlight to use solar. Everything else from wind power to geo thermal are also possible alternatives. There are many ways to make electricity and by driving electric, then we broaden the possible energy sources. It doesn't have to be oil and it doesn't have to be ethanol.

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