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Two Paths Forward on Oil and Gas

by Michael Levi
November 9, 2012

In a post earlier this week, I argued that people who want serious action on climate change will need to build bipartisan coalitions, which will require accepting oil and gas development. Most of the responses were encouraging, but one type of reaction was not. It came from proponents of oil and gas development, and went something like this: “Great post. But the United States can’t do anything about climate change because [it’s too expensive][renewable energy sucks][China won’t act][etc]”.

That reaction highlights something important: climate advocates aren’t the only ones who are going to need to build coalitions and accept compromise in order to get what they want. Enthusiasts for oil and gas development need to realize that they’re in a similar boat.

Oil and gas developers and their allies are both fighting against opposition that is focused most prominently on fracking and on the Keystone XL pipeline but that extends to issues like access to offshore acreage and fossil fuel exports too. Just like proponents of aggressive action on climate change, they’ve tried to win the policy fight in substantial part through aggressive messaging in favor of their cause. And, just like the climate advocates, they aren’t quite getting what they want.

That means that they too could benefit from making some mutually beneficial deals. Indeed the same sort of deal that I argued climate advocates should be looking for – serious action on climate change in exchange for expanded opportunities for production of oil and gas – is what advocates for oil and gas development should have on their minds.

In arguing that climate advocates should favor such a deal I emphasized one central point: the tradeoff wouldn’t fundamentally undermine their core goals. That’s because U.S. oil production is unlikely to have a large impact on world oil consumption and because natural gas is currently displacing coal.

Something similar ought to motivate enthusiasts for U.S. oil and gas production. Instead of asking, “Is serious U.S. action on climate change a good idea?”, they should ask this: “Is a package that expands opportunities for U.S. oil and gas production, while at the same time takes serious action on climate change, something that we prefer to the status quo?”

Just as people who are concerned about climate change don’t need to become oil and gas boosters in order to see the wisdom of compromise, proponents of expanded oil and gas production don’t need to become “climate people” in order to see the merits of making sensible deals. All they need to do is accept that serious U.S. climate action, regardless of whether if it solves the climate problem, isn’t the end of the world – and that it can be done without undermining their own core goals.

It turns out that oil and gas advocates have a similar pair of options to what climate advocates have. They can try to unilaterally push through their preferred options — or they can try to build coalitions that might not seem obvious at first blush. The latter path may be trickier, but it also raises the odds of real success.

Post a Comment 2 Comments

  • Posted by jim

    Michael, two great posts. If we’re to achieve anything w/ regards to energy and climate, we’ll have to acheive it the normal way: with good, old-fashioned mutually beneficial compromise.

    On a related note, it’s interesting to ponder which vehicle fuels have the greatest advantages in a post-Sandy world. Electric vehicles certainly would have been a problem in the 2-4 days following the hurricane; gasoline is still a problem because of distribution issues. Methinks nat gas has the distribution system most likely to be effective in another such disaster.

  • Posted by renewable guy

    http://www.greencarcongress.com/2012/11/pwc-20121105.html

    This year we estimated that the required improvement in global carbon intensity to meet a 2 °C warming target has risen to 5.1% a year, from now to 2050. We have passed a critical threshold—not once since World War 2 has the world achieved that rate of decarbonization, but the task now confronting us is to achieve it for 39 consecutive years.

    This isn’t about shock tactics, it’s simple maths. We’re heading into uncharted territory for the scale of transformation and technical innovations required. Whatever the scenario, or the response, business as usual is not an option.

    —Leo Johnson, Partner, Sustainability and Climate Change, PwC

    #########################

    Clean energy is not a luxory but is now a necessity. The proper role for the fossil fuels is to help the world transition to zero or neg carbon.

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