Never let a Good Crisis go to Waste!

Is the BP mess in the Gulf of Mexico a game changer or just a big mess?  As I watch the drip, drip, drip (no pun intended) of news reports on the Gulf of Mexico oil spill, I can’t help but think that the other “black fuel” might make a comeback as an unintended consequence of this situation. Coal has been beaten up and derided as the global warming issue turned into Al Gore’s crusade and the guilt-trip lingered even when the climate science scandal smudged the faces of the true believers.

Conventional wisdom tells us this is just a big mess and the most likely result is that BP will be tortured, pilloried in the press, fined and throttled by Government and investors, but the mess will eventually get cleaned up and BP will live to fight another day. This is the Exxon-Valdez spill scenario replayed.

But the political and economic climate is vastly different now and the Obama Team still has manifest destiny ambitions for taking over the economy and redistributing the wealth and not much time left with their majorities intact to do so.  And we know that the modus operandi is ‘let no crisis go to waste’ in the quest for victory.

So here’s my theory:

  • Bring Me Someone to Hang! BP will cap the leak and face its day of atonement in the media, on Capitol Hill, and in its share price and its CEO will be keel-hauled on his sunken oil platform.
  • Never Again ObamaEnergy Strategy. President Obama declaring ‘never again’ will tell the nation he is launching a new national energy policy that breaks our national addition to oil once and for all.
  • Offshore Oil for Strategic Petroleum Reserve. While the Federal regulators go after off-shore drilling sins writing new regulations that tighten E&P and drive up its cost, the Obama policy will appease his surly base by redefining off-shore efforts as limited drilling to prove the reserves potential on the Atlantic and Pacific Gulf and expanding them as part of the Strategic Petroleum Reserve.  In short this effort prepares to ‘save the good stuff off-shore for later use and don’t drill on my watch’ as these resources are prepped and inventoried and allocated by auction to big oil (let them count them as proven) but don’t actually extract them now—a win-win for Obama.
  • Unconventional Energy Land Rush. Domestic oil and gas production shifts back onshore to unconventional sources and the growth in production surges as bigger players focus on these opportunities.
  • Doubling Down on Clean Energy. ObamaEnergy focuses on a strategy of doubling down on energy efficiency, demand response, PHEV and smart grid.  This is achievable now since his new higher tax rates and financial regulation will drive most business off-shore leaving only the residential and commercial captive classes to face the new energy music.
  • Cap and Tax. Of course we will need a cap and trade bill with a carbon tax high enough to demonstrate we are serious about changing our sinful, wasteful ways.
  • 30/30 RPS. ObamaEnergy focuses on wind and solar and the transmission corridors needed to get them to market to achieve a 30% RPS target by 2030.
  • Energy Transformation Trifecta. What surprises everyone is that ObamaEnergy rounds out the package with a trifecta of clean coal technology investment, new nuclear investment and algae oil to create a new domestic energy powerhouse to fuel the ObamaEnergy future.
  • Clean Coal + Algae Oil Emissions Reduction Partnership. Big Coal players commit to ObamaEnergy as a new lease on life for the Black Gold joining forces with Big Oil seeking to build a market for algae oil  by partnering to use the CO2 captured from coal fired generation to produce algae fuels and thus avoid the carbon tax for the avoided emissions.  Big Coal wins, Big oil wins, ObamaEnergy wins and the rest of us pay.
  • Baseload Utilities Empire Strikes Back! Big Utilities see ObamaEnergy as open season for saving their baseload behinds and join forces with ObamaEnergy to build the next generation of new nuclear power plants.  ObamaEnergy goal is to fully displace the oldest, dirtiest coal plants by 2050 while creating a sustainable baseload foundation for expanding renewable energy from more intermittent sources AND assuring a reliable electric supply to fuel the PHEV fleet expected.
  • PHEV Volts the Nation! New transportation regs mandate a 50% market share for PHEV by 2050 with algae oil battling ethanol for the affection—and subsidies from Congress to make up 25% of the transport fuel market share by 2050.

And there you have it, the president gets his wish and a grand bargain is hatched on an unsuspecting public in one breathtaking energy transformation.

  1. The green and global warming left must learn to accept nuclear power and clean coal technology in order to get the policy commitment for a more sustainable energy future.
  2. Big Oil must go for the algae gold in transport fuels to break the addiction and gain access to onshore unconventional oil and gas resources for the short-term and access to stakes in the now expanded strategic petroleum reserve offshore for the long term.
  3. Big Utilities win because ObamaEnergy saves their central station generation business model with the new fleet of nuclear plants and big clean coal projects in exchange for a doubling down on renewable energy and efficiency.
  4. Big Technology wins with a smart grid strategy for preempting state control over transmission to enable scalable smart grid markets to gear and gadgets, software and sensors, green data centers and customer aggregation.

And on the seventh day, Obama rested—and it was good!

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