Achieving energy independence is paramount to our economic prosperity and national security. How to accomplish these priorities, however, has been the subject of political debate for decades.
Currently, the United States imports nearly 12 million barrels of oil daily to the tune of $1.1 billion. Our nation’s heavy dependency on foreign resources from unstable regimes leaves us at the whim of despots, potentially sacrificing access to reliable energy supplies.
Take, for example, the Iranian regime’s recent threats and war games in the Strait of Hormuz, which is considered by the federal government to be the world’s most important “oil chokepoint.” Last year, an average of 14 oil tankers a day, carrying 17 million barrels of crude from Gulf oil-producing nations, passed through the Strait of Hormuz. It is estimated that 35 percent of the world’s seaborne oil shipments and 20 percent of oil traded worldwide passes through the strait. Should this waterway be blocked, it would result in an international catastrophe.
There is room for both green and traditional energy. However, this administration unabashedly favors taxpayer-funded experiments in green energy technology while squashing proven and privately funded energy projects such as the Keystone XL pipeline.
The United States’ reliance on foreign oil has been likened to a ticking time bomb. Imagine using President Obama’s approach to energy to dismantle a live explosive. You could follow a bomb technician’s instructions and safely deactivate the explosive. Or you could disregard expert advice and haphazardly cut wires, hoping for the best. It may work out, but it could also result in dire consequences.
The Obama administration mirrored the latter approach when it fast-tracked loans to green energy companies. Take, for example, the now-infamous Solyndra boondoggle. Shortly after Mr. Obama took office, Department of Energy officials ignored the George W. Bush administration’s concerns about Solyndra’s loan application and approved a $535 million taxpayer-funded loan.
Within three years of receiving the loan, Solyndra filed for bankruptcy and became the subject of a federal criminal investigation. In fact, Feb. 17 marks the one-year anniversary of the congressional investigation into Solyndra. Two other loan recipients, Beacon Power and Ener1, have since filed for bankruptcy as well.
To borrow from Rep. Cliff Stearns, Florida Republican and chairman of the Energy and Commerce subcommittee on oversight and investigations, one bankruptcy may be a fluke, two could be a coincidence, but three is a trend.
Contrast those failures with the privately funded Keystone XL pipeline, whose application languished at the Department of State for more than three years before its permit was finally denied. Since TransCanada’s initial application, it has produced environmental and economic impact studies on multiple routes. Even after Secretary of State Hillary Rodham Clinton hinted at approval of the pipeline in 2010, Mr. Obama ultimately caved last month to the environmental lobby and denied the permit.
This decision could prompt TransCanada to look westward for a pipeline route and ship the oil to an eager consumer - China.
Besides equaling daily imports from openly hostile Venezuela, Keystone XL would create 20,000 direct jobs and up to 118,000 spin-off jobs. These jobs would employ some Americans hardest-hit by the recession - pipe fitters, machinists, welders and more. On the other hand, Solyndra’s bankruptcy not only cost taxpayers half a billon dollars, but also 1,100 jobs.
Innovation inherently carries risk. But it’s vital to balance risk with proven technology. Failure to do so is, at best, incompetence and, at worst, malfeasance. Meanwhile, Americans are held hostage at the gas pump.
Consider the price of gas when President Obama took office in January 2009 - an average of $1.78 a gallon. In January 2012, the cost had jumped 89 percent to $3.37 per gallon.
The administration made calculated, political decisions in the approval of green energy loans and the denial of the oil pipeline permit - both to the country’s detriment. We will never recoup the hundreds of millions lost on failed loans, but we can reverse course on Keystone. Currently, the House of Representatives is set to pass legislation to remove the State Department from the permit-approval process.
In his State of the Union address, Mr. Obama said, “I will not cede the wind or solar or battery industry to China or Germany because we refuse to make the same commitment [to clean energy].”
The president must not cede the oil industry to China, either. He must defuse the energy time bomb by allowing the Keystone XL pipeline to be built.