Energy crisis?  That was yesterday!  Questions facing society today are whether or not we were in an energy crisis and regardless of that status do we have an energy policy to address any potential, real or imagined crisis in the future.  To paraphrase Abba Eban, “History teaches that men, nations (and energy companies) behave wisely once they have exhausted all other alternatives.”  Could we expect a government and its citizens to behave wisely from the beginning if they are energy literate?  How could that literacy be realized?

The fact that the current energy situation appears quite political leads us to the conclusion that we have not yet reached the crisis stage as noted by just a few of the following issues.

•          California’s intransigence.

•          Alaska’s insistence on the Alcan highway route for a natural gas pipeline from the Arctic.

•          The lack of price elasticity as seen by the public's continuing to fill up their SUV's rather than curtailing energy use in response to price.

•          Opposition the 181-lease sale by, of all people, the President’s brother.

However, before we discuss policy, it is best to remember that an energy crisis really depends on one’s point of view and understanding (or lack of understanding) of the multitude of factors influencing energy. It is either:

•           The current shortage or glut.

•           The sharp rise or fall in price.

•           The exhaustion of the World’s oil supply or oil suppliers.

•            “Obscenely” high or low profits.

•           The strengthening or weakening of our friends or our enemies.

Economics 101 teaches us that supply and demand are always in balance ----- at a price.  One group or another may not like that price, but there is always balance.  And profits should never be looked upon as obscene.  Losses are what are obscene and profiteering is immoral and in most cases illegal, but profits are what FUEL our economy. 

Many times there is a lot of truth behind a slip of the tongue.  At a recent conference we heard a presentation on environmental issues where the speaker referred to the Kyoto Gratification Process.  We have to wonder what he really had in mind.  At the April 2001 Summit on U.S. Energy Policy, sponsored by the American Association of Petroleum Geologists, a speaker slipped with the title of this report.  We have to agree: National Energy Policy must be “Natural” if it is going to be sustainable.  What is the definition of a sustainable policy?  It must be robust in times of real crisis and in times when there is no real pressure or cries for solutions.

In former crises the concern was expressed as a fear of foreign oil.  This fear was really a fear of expensive oil.  Justified or not, this fear is alive today.  Even the daily comics got into the debate when in 1989 we saw Doonesbury note regarding the other Bush administration, “—and Bush’s message of the day, delivered in front of gorgeous visuals was -- Read my lips; Tax breaks for the oil companies.”  Then there is a Landsat photo of the Kuwaiti oil fields on fire with the caption, “Saddam Hussein’s Thousand Points of Light.”  The perception is that when pushed on supply or price far enough, regardless of political leanings, the US will “bomb the snot” out of whoever threatens our energy security.

It is such irrational emotionalism or apathy that must be overcome in order to establish any sustainable energy policy.

Regardless of the calls for policy in the past, the energy industry has ignored the public, without whose support no action would be possible, let alone sustainable.  Society has come to believe in the 28^th Amendment to the Constitution, which states, “The people’s right to life, liberty, and the pursuit of happiness shall be fueled by cheap and abundant energy.”  With the exception of very few periods in the past, industry has delivered and this perception has become a “Constitutional Right.”  When the industry asks why there is no sympathy when prices cycle to record lows, they only have to remember the words of Pogo, “We have met the enemy, and he is us.”

Sustainable (Natural) energy policy will only be attained with a knowledgeable public that can make informed, well-reasoned decisions about its choices and, therefore, that policy.  Many participants at the recent Summit emphasized this fact.  They really did “talk the talk”.  Now it will require the energy industry to “walk the walk” by making core investments on a continuing basis in broad based, balanced educational and informational programs.

The public is not yet panicked, but it is concerned and is asking for sound, unbiased information.  If the industry will not make those investments in light of today’s robust cash flows and this burgeoning demand for knowledge, this informational base is unlikely to ever be put in place, and the resulting policy will be short-term fixes at best.

Government Motivation.  All of society has a real motivation to achieve such a natural policy.  By creating a sustainable environment a great deal of uncertainty will be removed from the cost of doing business.  This cost reduction will be passed on to the consumer. Sound price signals will assure the proper balance of supply of the energy commodity. 

Timing.  True, the public cannot absorb accurate information in time to support the policy deliberations in Washington today.  And the crisis, if it existed at all, appears to be in remission.  But this is no excuse for the energy industry to further postpone the financing and implementing of long-term, comprehensive, proactive programs.   With the encouragement  – yes, even pressure – of government, the energy industry must start on this road right now.

Balance. The Energy Literacy Project (ELP) does have a bias on this issue.  We believe that such programs must recognize the interlocking nature of the 3 Es: Energy; the Economy in terms of how important energy is to our economic well-being; and the Environment in terms of energy’s impact on our quality of life.  These programs require all parties to rise above their parochial interest and show how important BTUs in any form, including conservation and energy efficiency, are in our daily lives.  From the perspective of the industry’s professional societies, this is a logical extension of education and technology transfer.  Now we have a much bigger audience: The public.

With the relationship of 3 Es in mind, Natural policy requires that current law be modified to mandate Economic Impact Statements in conjunction with Environmental Impact Statements.  EIS Squared (EIS²) reality and, we believe will lead to those informed, well-reasoned decisions that provide the basis of the sustainable policy we all seek

The key hurdle to such efforts will be implementation.  From the ELP’s studies, it is especially important to recognize that the messenger will be just as important as the message. 

The ELP and indeed all of us should recognize the current situation is perhaps the best opportunity to achieve a Natural Energy Policy.  It will require all parties to work together toward this goal and develop a public that is truly literate in energy to support that policy.

John C. Tobin is a consultant in energy economics and is Executive Director of the ELP.  (See www.energy-literacy.org) Susan M. Landon is a consulting geologist with Thomasson Partner Associates, Inc. in Denver and is past president of the AAPG and an advisor to the ELP.