Transportation Policy for America

Oil Addiction
America is currently addicted to oil, we consume 20-21Million Barrels of oil Per Day (mbpd), and this number continues to increase at the rate of about 2% per year. Against this, US Crude Oil production is roughly 8mbpd, a level which is declining over time. The US currently uses some 25-30% of global crude oil production, with less than 5% of the world’s population.

The need of the US to import 12-13 mbpd of Crude Oil has a significant effect on balance of trade and on foreign policy. Oil is the US’s largest import measured by cost or volume, and the country’s oil requirement places the US in a position of increased risk from a geopolitical perspective. There is also the fact that at some point, “Global Peak Oil” will arrive (the point at which oil is being pumped out of the ground at its maximum rate), meanwhile global demand also continues to increase at about 2% per year. In the free market, this supply-limited capacity and increasing demand will likely increase the costs of crude oil, increase price volatility, and increase America’s requirement to defend its energy interests globally.

The US also produces 30% of the worlds CO2, the largest proportion by any single country, again, despite the fact that the US represents only 5% of the global population. To come closer to the average global CO2 per capita, the US needs to reduce green house gas emissions by 60-70% .

The US needs a bold energy policy which accounts for this changing environment, maintains it’s “Leading Nation” position, and the standard of living of its citizens. The policy must be:

• Evolutionary; progressing from our current position
• Reasonable; not expecting any section of our society to bear an unfair part of the burden
• Sensible, rather than radical; to gain broad support from a wide range of political, scientific, environmental, and business interests.

The application of these criterion increases the chance of a policy being implemented successfully. The real need is to start the journey, and quickly!

This paper will look at the US’s transportation energy needs over the next 15 years, and suggest policies to transition the transportation sector to a more sustainable operational environment.

Efficiency is a national imperative
From a quantity perspective, the use of energy is an urgent problem globally, humans use vast amounts of non-renewable resources, but this happens primarily because of the ineffective and inefficient use of energy, and this issue is truly critical. At present, energy is directly consumed in the US with an efficiency of less than 35% and indirectly consumed with an efficiency of less than 2.5%. One could easily argue that there are massive amounts of cheap energy from all sources, readily available, to the point where humans fail to use this energy effectively. As we develop a better understanding of the impact of this inefficient use of energy we must make a choice to use it more wisely.

Let us use an automotive example to explain the difference between direct and indirect consumption efficiency. The internal combustion engine in your car operates at an efficiency of somewhere between 25 and 32%, that is, it converts the potential energy in the gasoline into available drive for turning the wheels and running other systems at a ratio of 3.5 to 1, this is direct consumption efficiency.

Indirect consumption efficiency is about what is done with the available energy, if it is used to power a 4000lbs SUV with one person in it, weighing 200lbs, the systems indirect consumption efficiency is just 5%. This is further reduced by inefficiencies in the gearbox and drive systems, and the fact that the system ‘throws away’ energy when the SUV sits at a red light, and every time the brakes are used. The end result is a systemic indirect consumption efficiency of less than 2.5%. In the SUV case above the overall efficiency of the system is just 0.75%.

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