Genetically Modified Organisms:
The Transatlantic Conflict Is Picking Up Speed
by Stephan Neuhäuser
On May 13, 2003 the United States finally filed the long awaited suit at the World Trade Organization (WTO) to force the European Union to lift its “moratorium on the approval of biotech products.” The term “biotech products” refers to genetically engineered (GE) food and crops also known by the more general term “genetically modified organisms” (GMOs); the most common being GE-corn (maize) and soybean. “The approvals moratorium has restricted imports of agricultural and food products from the United States.” says the U.S. administration. At the outset of the looming trade dispute that will quite likely involve numerous scientists testifying as experts for either side, it makes sense to take a look at the different viewpoints on both sides of the Atlantic.
The European Stance: In Dubio Pro Securitate
Usually European governments and the European Commission alike don’t speak of a “ban” or a “moratorium” on the import of GE food; although, since spring 1998, aside from GMOs already approved, no new GMOs have been authorized for planting or use in the E.U. This de facto moratorium was imposed at an E.U. Environment Ministers Council meeting in June 1999 when five Member States – Denmark, France, Greece, Italy and Luxembourg – issued a declaration, that they would effectively block new GMO approvals until appropriate E.U.-legislation was in place. Austria soon followed suit as a supportive Member State with Germany and Belgium making their declarations in October and December 2001 respectively. In fact, a new regulatory framework entered into force in the E.U. in October 2002. A number of GMOs have been submitted for approval under these new rules by various biotech companies, but haven’t been approved as of yet. Regulations on labeling and traceability of GMOs though, are still under discussion in the European Parliament and may enter into force in the course of 2003.
In its policy on GMOs the European Union is led by the “precautionary principle”, laid out in the United Nations’ “Cartagena Protocol on Biosafety to the Convention On Biological Diversity.” The much discussed “precautionary principle” means that preventive action should be taken, even without full scientific certainty about the problem that is being addressed. As of May 2003 there are 103 signatory states of which 49 have ratified the Convention On Biological Diversity. The U.S.A. has neither signed nor ratified it and downplays the relevance of the Cartagena Protocol.
The “precautionary principle” is largely in line with prevailing views among Europe’s public and consumers’ organisations, underlining the widespread skepticism about GE food amongst Europeans. One of the periodic “Eurobarometer” surveys by the European Commission addressed Europeans’ attitude towards science & technology in general and found that 71% of Europeans oppose food containing GMOs. In contrast, a 1999 Gallup survey showed that 66 % of Americans are in favour of GE foods; still, “if a crisis were to occur, there could be a very swift and strong backlash against the technology” Gregory Jaffe, director of biotechnology issues at the Center for Science in the Public Interest, is quoted in the Washington Post on May 30, 2003.
- Convention On Biological Diversity
- Convention on Biological Diversity (Cartagena Protocol)
- Fact Sheet on the “International Protocol on Biosafety” by the U.S. Department of Agriculture
- The Cartagena Protocol on Biosafety: An analysis of results (International Institute for Sustainable Development, Winnipeg, Canada), containing an extensive analysis of the “precautionary principle”
- The Precautionary Principle In Action – A Handbook (Science and Environmental Health Network, Windsor, North Dakota, and Lowell Center for Sustainable Production, University of Massachusetts)
- Eurobarometer survey on science & technology: Europeans and Biotechnology 2002
- Europeans and Science and Technology 2001 (Eurobarometer Report, European Commission)
- Gallup survey on biotechnology
- Center for Science in the Public Interest
- No Deal on Biotech Food – Industry, Opponents Fail to Agree on Recommendation for Regulation (Washington Post, May 30, 2003)
A New European Legislation
“If we are to make acceptance of GMO products possible in the European Union, then we must restore public and market confidence. In order to do so, we must provide consumers with an effective choice between GMO and non-GMO products. Labeling and traceability of GMO products will enable them to choose," the European Environment Commissioner Margot Wallström argued in December 2002. Her statement came in reaction to the common position agreed upon by the European Council and the European Commission on the GMO-labeling regulations last December. The agreement between Council and Commission provides for measures on European national levels to be replaced by common EU-legislation as soon as the European Parliament approves the proposed legislation (probably during 2003). The issue is now on the agenda of the European Parliament’s “Committee on the Environment, Public Health and Consumer Policy”.
As soon as the proposed legislation is adopted, products containing GMOs made available to European consumers will always have to be labeled as such. In addition, throughout the production and distribution chains, all information concerning GMOs will have to be handed from one party in the chain to the next, therefore providing for traceability. Codes for individual GMOs that have been used to constitute the original raw material for products intended for food, feed and processing, will have to be listed in documentations accompanying the final products.
The U.S. Stance: Is It Just About Trade?
In their WTO “Request for Consultation,” the United States accuse the European Commission and a number of European Union Member States of enforcing “a moratorium on the approval of biotech products,” further, of suspending the “consideration of applications for, or granting of, approval of biotech products under the EC approval system,” thus harming U.S. trade: “The approvals moratorium has restricted imports of agricultural and food products from the United States.”
In a testimony to the Committee on Agriculture in the U.S. House of Representatives, House Speaker Dennis Hastert, a powerful Republican from Illinois, estimates the annual losses in corn exports for U.S. farmers at over $ 300 million. The E.U.’s “ban” on GMOs is “based on fear and conjecture – not science,” says Hastert, and, he claims, had been imposed primarily “because we [American farmers] are technologically superior.” The U.S. Trade Representative Robert Zoellick recently talked about “the European fog of misinformation and protecionism resulting from E.U. biotech policies” and Senator Charles Grassley (R-Iowa), Chairman of the Senate’s Committee on Finance, called the E.U.’s policy “misguided” and “based on politics, not science” whilst “farmers are suffering from the European Union's policies.”
Argentina And Brazil Take Over From The U.S.
The United States is the largest corn (maize) and soybean producer in the world and exports approximately 20% of its corn crop and even 40% of its soy bean crop. Numbers published by the European Commission prove that the GMO-issue has hit the U.S. corn industry hard: In 1995 the E.U. imported 3,325.082 tons of corn from the United States, in 1997 imports decreased to 1,708.445 tons, in 1998 U.S.-exports to the E.U. sank drastically to 237,567 tons. In 2002 the E.U. imported a mere 25,934 tons. On the other hand corn imports from Argentina to the E.U. increased from 528,028 tons in 1995 to 1,347.595 tons in 2002. Both Argentina and the U.S. grow GE corn, with one decisive difference: a number of U.S. varieties have not been approved in the E.U., whilst all Argentinian varieties are E.U. approved. To make things worse for North American exporters, only about 2% of GE corn and non-GE corn are segregated. Therefore, approximately 98% of U.S. corn may contain GE corn varieties not approved in the E.U. This may change, however, as the U.S. Department of Agriculture (USDA) has recently proposed to create a voluntary labeling system for GE and non-GE crops. This proposal was made in the wake of the 2000 “StarLink-incident,” during which GE-corn branded “StarLink” meant only for animal consumption, had made its way into taco shells, chips and other food products. The reason was careless grain handling, forcing millers and processors to spend $ 1 billion in an effort spanning three months to get rid of the unhealthy corn-combination.
The GE soybean exports too seem to have been affected by the same debate that has been raging over GE corn, although U.S. farmers grow only varieties also approved in the E.U. Whilst Brazil trippled its soybean exports to the European Union (3,073.057 tons in 1995; 8,933.295 tons in 2002), U.S. exports to the E.U. decreased from 9,811.570 tons in 1995 to 5,518096 in 2002.
The Dispute Over The American Regulatory System
Along with the trade issue, there is an ongoing debate within in the U.S. about tightening rules for the biotech industry. Especially consumers’ associations, environmentalists and organisations dealing with science and the public are supportive of a stricter regulatory framework similar to European rules. Even some food companies fearing decreasing sales in foreign markets resistant to GMOs, have teamed up with them. In the past 2 years the “Pew Initiative on Food and Biotechnology” has brought together organisations supportive of stringent regulations like the Consumers’ Union, Environmental Defense, the Center for Science in the Public Interest and the Union of Concerned Scientists with food companies and the big names of the biotech industry (Monsanto, DuPont etc.).
The idea behind the “Pew Initiative on Food and Biotechnology” was inter alia to come up with a consensual proposal on how to improve federal legislation concerning the agricultural biotech industry. New legislation would give the USDA, the Environmental Protection Agency (EPA), and the Food and Drug Administration (FDA) more regulatory power in respect to the possible impacts of GMOs on agriculture, the environment and food safety. After exactly 2 years of negotiations the plan ultimately failed, but nevertheless the Pew Foundation issued a “final report” end of May 2003 that might be the starting point for the resumption of talks next year.
Though no official reasons were given why the talks were unsuccessful, the Washington Post links the breakdown of the Pew Initiative with the WTO action taken by the Bush administration: ”As part of that case, the administration will take the position that the current American regulatory system is fine. European consumer and environmental groups consider it to be egregiously inadequate. As the Pew discussions unfolded, the biotech industry grew wary of endorsing any compromise that would appear to support the European view and thus undermine the Bush legal case...”
Without new legislation, the regulatory status quo concerning GMOs continues to favour the biotech industry: Currently the FDA runs a voluntary system under which biotech companies themselves decide on how to assess the safety of their products. Generally, biotech companies submit data of their GE products to the FDA which checks them and subsequently informs the companies that the FDA has no objections.
Though federal lawmakers are still undecided on how to address issues raised by agricultural biotechnology, the states’ governments are all the more active. During the 2001-2002 legislative session alone, 158 pieces of legislation related to agricultural biotechnology were introduced in 39 states. The Pew Initiative on Food and Biotechnology keeps track of new and changing legislation in its “Legislation Tracker” released on June 11, 2003. This database can be used to research data on all legislation related to agricultural biotechnology submitted in the 107th Congress (2001-2002), all legislation related to agricultural biotechnology sorted by state, topic or bill status and an overview of ballot initiatives and town hall resolutions related to agricultural biotechnology initiated in select states since 2000.
Bickering Over Food Aid
Another argument frequently voiced by the U.S. side is that the European Union is forcing a growing number of developing countries into refusing GE crops and seeds that have the potential of aiding starving populations. This disregards the fact that GE-crops of interest to developing countries, such as drought or salt water resistant crops haven’t yet left the laboratories. The U.S. Trade Representative Robert Zoellick accused the Europen Union of leaning on poor countries and threatening them to withdraw economic aid unless they prohibit genetically modified crops. In a letter to the editor of the Wall Street Journal he praised a previous editorial that had talked about "Immoral Europe" and “The Human Costs of Biotech Fear-Mongering.” Zoellick’s views found favor with the 1970 Nobel Peace Laureate Norman Borlaug, a central figure in the “Green Revolution” of the 1960 and 1970s, who in January published an Article in the Wall Street Journal’s “OpinionJournal” aptly titled “Science vs. Hysteria – European Environmentalists’ Tactic Against Biotech: Starve Africans.”
Zoellick’s allegations were quickly countered by the E.U.’s Trade Commissioner Pascal Lamy in a letter also published in the Wall Street Journal: “To say Europe is bullying Africa into refusing to accept American food aid even though millions are malnourished and starving is downright irresponsible… We very much regret that U.S.-officials are peddling this rumour, and even more that the Wall Street Journal is giving credence to it, without checking the facts on E.U. food aid.” It should be mentioned, however, that the European Commission has asked the United Nations’ World Food Programme to purchase only non-GE corn for distribution of food aid in a move to ensure that food aid is not rejected by the governments of recepient countries.
“Washington Has Pulled The Trigger”
Eventually, the Bush Administration’s WTO case may lead to a veritable trade battle, doing the United States more harm than good, argue David Victor,director of the programme on energy and sustainable devlopment at Stanford University, and Ford Runge, professor of applied economics and law at the University of Minnesota,in the Financial Times’ op-ed on May 15, 2003. They have identified three possible scenarios:
The “most likely (and worst)” scenario, according to Victor and Runge, would be an American victory. As a case in fact they quote the trade dispute over hormone-treated beef in the 1990s the European Union lost. The “precautionary principle” brought forward in this case by the E.U. had not (yet) been accepted by the WTO’s appellate body as a principle of international law. Despite victory, hormone-treated U.S.- beef has still not found European customers. In fact, the defeat of the U.S. beef-industry in the “courts of customer opinion” (Victor and Runge) has led to counter-sanctions and political damage to transatlantic relations. The controversy over GM food seems likely to unfold in a similar way.
The European Commission has drawn up in brief its trade-war-timetable, already considering the establishment of the panels of the WTO’s “Dispute Settlement Body”; whilst the Speaker of the U.S. House of Representatives Dennis Hastert speaks of battle: “Hopefully, the WTO will act quickly to resolve the Administration’s case on behalf of American farmers. There’s no doubt that the U.S. and American agriculture go into this battle with the facts on our side. We simply cannot allow the free trade of our fine products and services to be rendered meaningless if they are short-circuited by the EU’s unfair and unjust trade barriers cloaked in fear and conjecture – not sound science.”
Stephan Neuhäuser works for the Department of International Cooperation within the Austrian Research Ministry. He is currently at the Office of Science & Technology as Senior Visiting Expert and can be contacted at neuhaeuser@ostina.org.
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Where Change Is The Only Constant.
A diverse range of applications over the next decade will change the nature of the debate about biotechnology. Europe’s response will be critical.
a commentary by Donal Nugent (Council for Agricultural Science and Technology)
For the Spanish conquistadores who encountered the flourishing civilizations of Mexico in the 16th century, the diet of these new peoples was a source of some wonder. Corn (maize), in particular, they noted was held in the highest regard. Ironically for a crop that had its own god, this food is almost entirely the product of human ingenuity. From humble weedy relatives, centuries of selective breeding have created these powerful stalks crowned with golden cobs. The modification of genes has been a human endeavor since the birth of civilization but, as the ancient Mexicans knew, nature likes to take its time. Today, even at its most advanced, conventional agronomy needs between 10 to 12 years to generate a new crop variety. This is because plants need to be back-crossed, that is bred with distant relatives, to ensure unwanted genes are eliminated while retaining the desired trait. Biotechnology, as a process that facilitates the transfer of individual genes, bypasses this process and allows for the direct incorporation of traits. This is the source of both its promise and its controversy.
To date, the most commercially successful genetically modified varieties of crops have had genes added that make them either disease resistant or herbicide tolerant. There is a good reason for this. The need to commercialize crops that bring significant financial returns is a matter of business expediency, given the enormous costs and rigorous regulatory procedures involved. On-going research in universities and industry around the world points to an array of novel applications for biotechnology which will certainly impact further the food we eat but which will also bring even more dramatic developments in diverse applications from biofuels, plastics and pharmaceuticals.
Jurassic Park – Not Yet Open For Business
While the best-known biotech engineered crops are soy and corn, disease resistant or herbicide tolerant varieties of most major fruits and vegetables have also been developed. For a variety of reasons, mostly to do with consumer acceptance, the majority has yet to be commercialized. One notable exception, however, points to the future potential of the technology. The dream of resuscitating extinct species may still be the stuff of Spielberg, but a more practical success can be claimed with the resuscitation of the ailing Papaya industry in Hawaii. Papaya Ringspot Virus had put the industry into a serious long-term decline until disease resistant varieties, developed using biotechnology, were introduced in the late 90s. Europe obviously places a high value on its food security and should crops (or animals) succumb to diseases, which cannot be conventionally managed, biotech solutions could find themselves high on the agenda. At the height of the BSE crisis in Britain, American soy was imported on a large scale. The usually skeptical British raised few questions about the use of a biotech-derived crop when the alternative (feeding the animals to themselves through meat and bone meal) had proved such a disastrous course.
Whatever about the return of the dinosaur, the dream of feeding the world is one thankfully not the preserve of mad scientists. Born in Hirschberg, Germany in 1933 and gaining his doctorate at the Max-Planck-Institute in Cologne, Dr Ingo Potrykus has played a major role in developing and applying genetic engineering technology to crop plants and diseases in the Third World. Potrykus made the cover of Time magazine in 2000 with the development of GM ‘golden rice’, a variety rich in beta-carotene from which the body produces vitamin A (conventional rice has no vitamin A). The Time headline ran ‘This rice could save a million kids a year.’ The biotech element of the rice incorporates daffodil genes, which provide the golden colour and helps fortify it with beta-carotene. Commercialisation of this rice is still a few years down the line and should provide an interesting case study in consumer response to a biotech product with a significant health benefit over its conventional counterparts.
The International Food Information Council has identified a number of biotech-enhanced products at research level, which may soon find their way to the supermarket shelf. These include: cooking oils with higher stearate levels; small, single serve, seedless melons; tomatoes with increased lycopene; higher starch potatoes (which absorb less fat); and strawberries containing ellagic acid (a natural cancer-fighting agent). Developments in biotech derived foodstuffs are not limited to plants. The US Food and Drug Administration (FDA) is currently considering a license for the first transgenic animal into the food chain, a salmon that grows at four times the rate of conventionally farmed salmon. The marketing of this food will certainly bring the debate about biotechnology to a new level. Opponents will argue that such fish will represent a real danger of transgenic gene flow into the environment and the FDA is certain to consider security and containment issues as the most important in deciding if a license should be granted. Supporters will point to more efficient energy consumption and less waste production from these animals as compared to their conventionally farmed counterparts. They will also argue from experience that farmed fish simply do not prosper in the wild.
The Third Wave
Biotechnology has been used to derive medicines such as insulin from plants and animals since the 1980s. Advanced medical applications, such as the potential for transplanting rejection-free animal organs into people, have received widespread attention and will continue to register as fascinating confluences of science and ethics.
Less well know is the so-called ‘third wave’ application (medicine and agriculture being the first two), namely industrial biotechnology. Dr Barry Marrs, executive director of the Fraunhofer USA Center for Molecular Biotechnology believes that the application of biotechnology to manufacture industrial chemicals is fast approaching a reality while the production of biodegradable plastics and fibers from corn is already feasible. Industrial biocatalysis could change the nature of many aspects of the industry, he says: “The drivers are very powerful. We are finding better catalysts and improving them through directional evolution.” Dr Marrs believes that molecular farming, where complex chemicals are grown as components of GM crops, could transform chemical manufacturing into a greener, cleaner enterprise and reduce costs to a fraction of current levels. The technology may be groundbreaking but applications are not necessarily so: One biochemical he had developed is processed into a plastic with short-term cohesion properties, which finds perfect use in kitchen paper. After use, the plastics break down into the same biodegradable compounds as milk. (Dr Marrs spoke on May 7, 2003, at the EPA 2003 Science Forum: Partnering to Protect Human Health and the Environment, May 5-7, 2003, Washington DC in a session entitled Emerging Technologies)
Animal Crackers
Science has long recognized spider silk to be among the strongest fibers on earth but harvesting it for industrial uses was impractical (spiders being averse to domestication). A major project at the University of Wyoming has involved inserting spider silk genes into goat DNA resulting in transgenic animals that produce the spider silk proteins in their milk. The proteins can then be processed into a material that, under the trade name Biosteel, will find applications in medical equipment in the near future.
More conventional applications of biotechnology in animals could lead to enhanced productivity, less pollution and greater disease control. The birth of Dolly the sheep raised many long-term ethical questions, but the practical application of the technology in animal breeding is fast approaching feasibility. According to the FDA, cloned animals of high genetic merit could become available for breeding in the U.S. within three years.
Handling biowaste has become one of the big environmental issues in modern intensive farming. In the University of Guelph, Ontario, Canada, the Enviropig is living proof of one biotech-derived solution. The pig has been engineered to produce less phosphorus in its waste and therefore introduce less potential pollution in the environment. It will require several years more testing before the Enviropig is considered for introduction to the market.
Researchers investigating biotech applications in poultry are examining the possibility of enhancing resistance to pathogens through genetically engineered vaccines, a procedure that would have application in all food animals.
The study of microbial DNA is also allowing for a better understanding of how pathogens develop and interact with their hosts, a knowledge base will almost certainly contribute to the development of future disease treatments.
Taking Stock
Biotechnology is providing European science, and the industries that depend on it, with a challenge. On the one hand, EU consumers continue to reject the use of biotechnology in food and demonstrate grave misgivings about the presence of biotech crops in their environment. On the other, European science is recognizing that biotechnology will become an important tool in the development of an increasingly diverse array of foods, medicines and chemicals. Some interesting anomalies point to the complexities inherent in the debate. In spite of consumer misgivings about genetic engineering, biotech-derived enzymes have found widespread use in the production of cheeses and beers in the EU. The EU does not require them to be identified on labeling because they are part of a process rather than actual ingredients. Golden rice, which may ultimately provide huge help benefits (by preventing blindness) in developing countries, was developed in Europe with EU funds part financing it.
Repeated scientific studies in all EU member states have come out in favor of biotechnology as safe and environmentally friendly science but receive little coverage in the media. In April this year, the British government established a citizens’ jury to examine all the aspects of the debate. By a narrow majority it came out in favor of the use of the science. On the other hand, the formal complaint by the U.S. government about the ‘de facto’ EU moratorium on biotechnology will do little to warm European consumers to the prospect of biotech foods.
Donal Nugent is a Dublin-based journalist and writer and former editor of Irish Veterinary Journal and Irish Food. He is currently Science Journalism Fellow with CAST and can be reached at dnugent@cast-science.org
The Council for Agricultural Science and Technology (CAST) assembles, interprets and communicates science-based information regionally, nationally and internationally on food, fiber, agricultural, natural resource and related societal and environmental issues to its stakeholders - legislators, regulators, policy makers, the media, the private sector and the public.
www.cast-science.org
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The Politics Of Energy
by Sylvia Pilz and Himangi Zanpure-Sattler
Undeniably, energy is fundamental for economic performance. At the same time, most experts agree that greenhouse gas and carbon emissions are related to all facets of energy use in the economy. Global climate change is one of the key concerns of the 21st century, with serious implications for economies, societies and the environment. A central challenge is the integration of climate and environment policy objectives into other sectoral policy areas.
The present article is an attempt to outline the characteristic problems faced by the United States as a function of high energy consumption, growing energy needs and a lack of agreement on how to reconcile the environmental concerns. We will also take a look at the National Energy Plan of the Bush Administration and the on-going debate around the Energy Bill, currently a hot issue in Congress.
Consider These Figures……
In 2001, 3 countries – the United States, Russia and China, with a combined population of 1.71 billion out of a global 6.30 billion - were the leading producers and consumers of world energy. They together produced 38% and consumed 41% of the world’s total energy. The United States is the global leader in energy consumption. In the year 2001, it made up almost a quarter of the world’s primary energy consumption. Primary Energy includes coal, natural gas, petroleum, and electric power (nuclear, hydro, alcohol fuels, geothermal, solar, wind, and wood and waste). Out of the world consumption total of 403.92 quadrillion Btu (British thermal unit), the United States alone consumed 97.05 qBtu. To compare, Canada spent 12.51 qBtu of energy and Austria contented herself with 1.42 qBtu, France consumed 10.52 qBtu, Germany used up 14.35 qBtu and Angola and Bangladesh claimed their share of 0.09 and 0.51 qBtu repectively.
Now translate this into per capita figures and it becomes obvious that the U.S. has one of the highest per capita energy needs in the world - 341.8 million Btu. (incidentally, the per capita energy consumption in Canada is even higher - 402.6 million Btu). The average per capita in western Europe ran to about 150 million Btu. In France the per capita consumption was 177.8 million Btu, in Austria it was 175 and in Spain 141.5 million Btu. To continue with our example of Angola and Bangladesh, the per capita figures were really modest: 6.9 and 3.7 mbtu respectively. In the U.S. the transportation sector alone gobbled up over 27% of total energy, being only surpassed by the industry with a narrow margin. World-wide, the United States remains the single largest consumer of energy, matching its share of energy consumption with its share of GDP (Gross Domestic Product) in the world total.
In the United States coal, oil and natural gas and nuclear energy represent the chief sources of energy production.
Black-Out
Traditionally, the US has depended on coal as a major source of primary energy and in particular, for electricity generation. In the U.S. in 2001 more than half of total domestic electricity generation was from coal, whereas only 20% came from oil and gas together, the same as from nuclear energy.
Worldwide, according to the Energy Information Agency (EIA) of the U.S. Department of Energy, coal use is expected to decline in Western Europe, Eastern Europe, and the former Soviet Union. Increases are expected in the United States, Japan, Australia, New Zealand, and developing Asia, in particular, China and India. In Western Europe, coal consumption declined by 30% between 1990 and 2001 displaced in large part by the growing use of natural gas and, in France, nuclear power, where it constitutes 77% in electricity generation. A similar decline occurred in the countries of Eastern Europe and the former Soviet Union where coal use fell by 40 percent between 1990 and 2001 as a result of the economic collapse that followed the breakup of the Soviet Union, as well as some fuel switching. In 2001, coal provided 24 percent of world primary energy consumption, down from 26 percent in 1990 and is projected to fall to 22 percent by 2025.
The Oil Factor
The U.S. meets just under one third of its demand for oil domestically, and imports about 9,651 thousand Barrels per day. The top exporters to the U.S. of oil in recent years have been Saudi Arabia, Mexico, Canada, Venezuela and Nigeria. The relative importance of each supplier has varied periodically, shaped to a certain extent by the reigning political circumstances. The NAFTA partners Mexico and Canada have become major suppliers to the U.S. market in the past decade. Since 1991 (first Gulf War) Canada has been the second largest exporter to the US, Saudi Arabia being the number one with more than 1,600 thousand barrels per day. Mexico as a major exporter entered the fray in 1993 and has held top ranks ever since. Venezuela, an OPEC member, supplied 1,538 thousand barrels a day in 2001. The share of OPEC in total oil supplies to the U.S. has fallen from around 53% in the early 90s to about 45% since 1995. Iraq’s oil has been reaching the world market through the “Oil for Food” program of the United Nations, but in modest measures.
Renewables: Can They Ever Catch Up?
The share of renewables in the total U.S. energy consumption constitutes a meagre 5.7 qbtu, or about 6%. Hydropower has the lion’s share (which, incidentally, has been steadily decreasing over the decades) and the rest is contributed by geothermal, wind, solar and wood and waste energy combined.
The current debate around energy from hydrogen is not about the “if”, but about the “how”. There is disagreement between the Americans and the Europeans about the “how”. The Europeans are convinced that renewables have to form the cornerstone of a future hydrogen energy economy. The Americans are determined to find ways to produce hydrogen from nuclear energy and by using cleaner coal-burning technology. In his State of the Union address of Januay 2003 President Bush declared: “In this century, the greatest environmental progress will come about…….through technology and innovation. Tonight I'm proposing $1.2 billion in research funding so that America can lead the world in developing clean, hydrogen-powered automobiles.”
In order to get a complete picture, the energy consumption figures have to be seen in the context of their effect on the environment and public health.
Greenhouse Gases: A heavy burden to carry
Threats posed by climate change, air pollution and endangered ecosystems remain global in nature. The problem becomes particularly acute in a country that has only 4% of the world`s population, but emits nearly 25% of the total global greenhouse gases. The chief culprits here are the fossil fuels: petroleum, natural gas and coal. The United States continues to be the largest single national source of fossil fuel-related CO2 emissions, with 1.5 billion metric tons carbon equivalent in 2001, - although its share of global emissions did decline from 44% to 24% in the period 1950-1990s because of higher growth rates in other countries.
The U.S. Energy Information Administration projects that carbon dioxide emissions will continue to increase by an average rate of 1.5% per year. If current trends continue, CO2 concentrations would increase by 30 - 150% by the year 2100. 39% of U.S. fossil-fuel emissions stem from the consumption of petroleum products and 38% from coal usage. In 1999, the U.S. consumption of coal was 20,498.0 Trillion Btu, that of natural gas and petroleum 22,294.9 Trillion Btu and U.S. 37,960.01 Trillion Btu respectively.
Regional Impacts Of Growth And Climate Change In The U.S.
Due to great geo-physical and demographic differences in the country, the nature of environmental problems varies regionally. The Southeast has faced frequent natural weather disasters in the past 20 years, costing the region over $85 billion in damages, mostly associated with floods and hurricanes. At the same time, the heat wave and drought of 1998 resulted in damages in excess of $6 billion and 200 deaths.
In the West, population figures have quadrupled since 1950, with major concentrations in urban areas accompanied by problems of water shortages, high levels of air pollution and urban sprawl. California, the most populous state with 35 million inhabitants (about 8% of total U.S.) alone accounted for almost 11 percent of all freshwater used in the United States in 2002. Most of the water used in California was for crop irrigation; in fact, 22 percent of all the Nation's irrigation water used was in California.
What scientists agree on is that climate change has become a global phenomena; disagreement remains about the extent of influence of human activity on these changes. Policy-makers today face the challenge of visualizing alternative futures in concrete and human terms for a regional mosaic of consequences that are possible due to climate change and variability.
Though the effects of most environmental problems can be measured in monetary terms, their impact on human health is harder to quantify.
Worldwide, low lying ozone and air pollution have led to elevated rates of cardiac and respiratory illnesses and deaths in recent years. The Environmental and Energy Study Institute (EESI) in its report “Public Health Impacts of Climate Change” of July 2002 cites a study conducted in 1997 by the Working Group on Public Health and Fossil-Fuel Combustion, comprised of the World Health Organisation (WHO), World Resources Institute (WRI) and others. The study estimated that world-wide up to 700,000 deaths annually were related to air pollution and roughly 8 million excess deaths could occur by 2020.
Some Like It Hot?
Heat waves are not just continually claiming lives around the globe; fainting, heat exhaustion and heat stroke pose constant risks to human health as the frequency and intensity of heat waves increases. The IPCC report mentioned previously predicts that by the second part of this century roughly half of the world’s population may live in areas where malaria is prevalent as a result of climate change. It looks like the only ones who won’t be complaining about the rise in temperatures will be the mosquitoes and other blood feeding insects who will enjoy longer breeding and virus transmission seasons.
The above paragraphs contain but a few challenges that the world is facing today on energy and environment issues. There are no tailor-made solutions to the problems; at best there are initiatives and resolutions which depend on national and individual commitment for their successful implementation.
Global Initiatives On Environment and Energy
The 2nd Earth Summit of 1992 in Rio de Janeiro, Brazil turned out to be the largest gathering of world leaders ever. The Earth Summit created the United Nations Framework Convention on Climate Change, also known as the Rio Convention. This convention, perhaps too ambitiously, called upon the world to stabilize 1990 greenhouse gas emissions by 2000. Both Canada and the United States signed and ratified this convention. Importantly, former U.S. President George Bush negotiated an agreement to allow developing nations to increase emissions, the reason they are not included in the Kyoto Protocol.
At the third Conference of Parties (COP) to the Rio Convention in 1997 in Kyoto, Japan, new targets for controlling greenhouse gas emissions were set. The regulation of CO2 emissions was the main item on the agenda, with varying targets set for varying countries. The onus of reducing most of the emmissions lies on the so-called Annex B countries (United States, Canada, Australia, New Zealand, Japan, European Union, Russia, Ukraine and Eastern European countries). The European Union operates under a “bubble”, a system whereby quantitative emission divergence among the operating countries is allowed as long as the aggregate quantified emission stays within the set target. (to illuminate: EU target is 92%, Austria has committed itself to a reduction to 87% of 1990 levels, Greece may reach 125% of the same within the set time-frame).
Under Kyoto, the Clinton Administration committed itself to reducing greenhouse gas emissions to 93% of 1990 levels by the year 2012. But even before President Bush made it clear that he did not support the provisions of the Kyoto Protocol, the Senate, in 1997 had delivered its verdict. The Byrd-Hagel Resolution (Senator Byrd, a West Virginian Democrat, is serving the eighth consecutive six-year term in the U.S. Senate; Senator Chuck Hagel is a Republican from Nebraska) passed in July of that year by a margin of 95-0, thus transcending all partisan lines, stated that the U.S. Senate will not ratify any international agreement on greenhouse gases emissions under the United Nations Framework Convention on Climate Change that “would impose binding limits on the industrialized nations but not on developing nations within the same compliance period and would result in serious economic harm to the economy of the United States."
On March 13, 2001 President Bush wrote to four conservative Senators – Hagel, Helms, Craig and Roberts - outlining his opposition to the agreement, referring in it to the Senate’s vote in 1997 against the Protocol. In that letter, the President repeated the economic reasoning used by the Senate in it’s time. The President reiterated his commitment to address global climate change issues in the context of a national energy policy. “Any such strategy [multipollutant strategy to require power plants to reduce emissions of sulfur dioxide, nitrogen oxides, and mercury] would include phasing in reductions over a reasonable period of time, providing regulatory certainty, and offering market-based incentives to help industry meet the targets. I do not believe, however, that the government should impose on power plants mandatory emissions reductions for carbon dioxide, which is not a ‘pollutant’ under the Clean Air Act.”
Until the official announcement by Environmental Protection Agency Administrator Christine Todd Whitman on March 27 2001 that the Administration had "no interest in implementing that treaty", meaning the Kyoto Protocol, there had still been some hope in the European Union and Japan that the Bush Administration would resort to further negotiations to change some of the rules to better suit it’s agenda. Greenpeace said that Bush's decision was driven "by oil, coal and gas interests" and expressed it’s outrage at the decision in the following words: "Greenpeace is disgusted and appalled at the United States".
The Administration’s stand found support and applause among U.S. industry groups like the Global Climate Coalition.
Putting The Nation On A New Path: The National Energy Plan
After just two weeks in office, in January 2001 President Bush set up a National Energy Policy Development Group, headed by Vice-President Cheney directing it to “develop a national energy policy designed to help the private sector, and, as necessary and appropriate, State and local governments, promote dependable, affordable, and environmentally sound production and distribution of energy for the future.”
The task force was directed to develop a long-term comprehensive national energy policy. The basic premise was that the prosperity of the country and the American Way of Life require a steady and reliable supply of large amounts of energy. In it’s report the Group made the case that a fundamental imbalance between supply and demand defines the nation’s current energy crisis and that if energy production will increase at the same rate as during the last decade the projected energy needs will far outstrip expected levels of production. To correct the imbalance between supply and demand a 3-pronged approach was recommended: achieve greater energy efficiency, modernize energy infrastructure, and increase energy supplies. The fact that “America leads the world in scientific achievement, technical skill, and entrepreneurial drive” and possesses “abundant natural resources, unrivaled technology, and unlimited human creativity”, the report surmised, should come in good stead to meet the goals.
Very few of the recommendations in the report concerned demand side corrections. Federal agencies were encouraged to take actions to conserve energy use in their facilities and increase funding for renewable energy and energy efficiency research and development programs.
The recommendations to increase supply and reduce dependency on foreign energy were manifold. The exisiting energy infrastructure, warned the report, was in dire need of modernization and repair. In addition, in order to avoid supply bottle-necks 38,000 miles of new natural gas pipelines and about a quarter million miles of distribution lines would be required.
The Plan made a strong case for increasing energy production capacity. To strengthen it’s case, the Plan presented the following estimates: over the next 20 years, U.S. oil consumption would increase by 33%, natural gas consumption by over 50% (one of the reasons for this high demand is that about 90% of all new electricity plants under construction would be fueled by natural gas) and demand for electricity would rise by 45%.
The fact that in recent years natural gas has increasingly substituted coal in energy generation is a result of the recognition world-wide that natural gas, though not the cleanest technology, does produce lower levels of harmful emissions than coal.
One specific recommendation of the Plan was to open the Arctic National Wildlife Refuge (ANWR) to oil and gas exploration. The recommendations with regards to coal went towards maintaining the status quo. The way President Bush and his team saw it, time was not yet ripe for decreasing the dependence on coal, since, as they put it “the U.S. has enough coal to last for another 250 years”. Perhaps to take away some of the force of the criticism that might possibly ensue, the Plan made a recommendation in the same breath to provide $2 billion over 10 years to fund clean coal technology research. Discernible readers might remember from a previous article in Voices on U.S. R&D budget that the R&D budget for the FY 2004 alone is $122 billion!
Increased use of nuclear energy for power generation was also advocated in the report, citing the examples of countries like France and Japan that rely heavily on nuclear energy. The legislators were called upon to enact “multi-polltant” legislation with an aim to cap emissions of sulphur dixide, nitrogen oxide and mercury from electric power generators. The recommendation omitted any mention of carbon dioxide as a pollutant, which is, in fact one of the main sources of greenhouse gases. We will consider the implications of and political reasons behind this omission in our article on Clean Air and the legislation around this issue.
The Congress, Environment And Energy
The 107th Congress (2001-2002) that convened after the Presidential elections of 2000 was faced with a tough challenge – how to reconcile the Congress’s commitment of the past decade to enact legislation to protect the environment with the new agenda of the Bush Administration on environmental and energy matters, specifically the National Energy Plan. The Bush agenda on energy, environment, and the handling of corporate interests differed in many regards from that of the previous administration’s. The Congress Senators and Representatives very soon found themselves confronted with the task of transforming that agenda into legislation or rather, from preventing that agenda being transformed wholesale into legislation.
In June 2001, the House blocked the Interior Department from issuing permits for coal mining and oil and gas drilling in national monuments, in 2002 it passed the Bipartisan Campaign Reform Act (BCRA) which aimed to reduce the disproportionate influence of special interests through donations to election campaigns. One of the notable achievements in favour of protecting the environment was the passing of the brownfield legislation that would help revitalize abandoned industrial sites around the country.
Post September 11, “homeland security” took on a new meaning. For the energy policy of the country it meant a dramatic shift of emphasis on the need to take urgent steps to reduce U.S. dependance on oil from volatile and “hostile” regions of the world. The Administration started pushing for swift legislation to allow drilling for oil in America’s pristine wilderness.
Sweeping exemptions from environmental laws such as the Clean Air Act and the Endangered Species Act were sought for the Department of Defense and as part of the Homeland Security Bill corporations were granted broad exemptions from public disclosure about spills, leaks and pollution releases.
The movement and discussion around the comprehensive Energy Policy Act of 2002 (H. R. 4) in the 107th Congress and the inability of that Congress to find common acceptable grounds on energy legislation are a clear reflection of the tug-of-war that took place in the Congress. Senator Tom Daschle, a Democrat from South Dakota, the then Senate majority leader stood strong on environmental issues, and in particular on the issue of oil drilling in the Arctic National Wildlife Refuge (ANWR) with solid backing from Senator Jim Jeffords (Independent from Vermont) as Chairman of the Environment and Public Works Committee and Senator Jeff Bingaman (Democrat from New Mexico) of the Energy and Natural Resources Committee.
A renewal of the debate over key energy issues including the newly proposed Energy Bill in the current 108th Congress will very likely reflect a shift in priorities as a result of the new Senate leadership which went to the Republicans in the wake of the mid-term elections of October 2002 and the ensuing changes in committee chairmanships in both Chambers of the Congress. The turbulent events of the past year, viz. the war in Iraq and the crisis in Venezuela, a major oil supplier to the US will undoubtedly contribute to the changed climate.
The Energy Bill: Solution In Sight?
Introduced by Congressman Bill Tauzin (R-Louisiana), who is the Chairman of the House Committee on Energy and Commerce and a senior member of the House Resources Committee, a comprehensive energy bill H.R. 6 was passed by the House on April 11, 2003.
The bill is a composite of separate measures approved by four House committees. H.R. 6 includes several provisions that were part of comprehensive energy legislation (H.R. 4) debated during the 107th Congress like energy efficiency and conservation, clean coal technology, and reauthorization of the Price-Anderson Act nuclear liability system. It would also establish a Renewable Fuels Standard for gasoline of 2.7 billion gallons by 2005 and 5 billion gallons by 2015, chiefly intended to increase the use of ethanol. The bill passed by the House would also eliminate the current 2% oxygenate mandate for reformulated gasoline (RFG), but would not ban MTBE (methyl tertiary butyl ether) outright. It is an additive used to improve combustion in RFG and an octane enhancer in non-reformulated gasoline. MTBE is notorious as a ground water contaminant and has been banned in 17 States including New York and California.
The bill also approves exploration, development, and production of oil in the Arctic National Wildlife Refuge (ANWR), it would seem, almost in defiance of the Senate. On March 19, 2003, almost a month before the House passed H.R.6, the Senate voted 52 to 48 in favour of an amendment introduced by Senator Barbara Boxer (D-CA) to prevent consideration of drilling in ANWR in a fast-track budget reconciliation bill. (A “reconciliation” bill precludes Senate filibusters, which are procrastinating and obstructionist tactics in legislative assemblies. It has particular reference to the U.S. Senate, where the tradition of unlimited debate is very strong).
This was an astonishing development given the fact that the Senate is under Republican majority rule (Bill Frist, R-TN is the majority leader) and there had been hopes among Republican leaders that the takeover of the Senate would change the upper chamber’s longstanding opposition to oil production in the Arctic Refuge. The hopes were shattered by 8 Republicans who sided with the Democrats against the drilling, including Senator John McCain of Arizona and Senator Lincoln Chafee of Rhode Island. The crucial votes came from Senators Norm Coleman of Minnesota and Gordon Smith of Oregon, whose position was not final until the floor vote. Senators from Alaska expressed their fury by saying that apparently caribou was more important than jobs for the people.
Alaska supposedly holds 30 trillion cubic feet of undeveloped natural gas reserves, about 18% of total U.S. reserves; these estimates have been disputed by many. The House bill limits the surface of “production and support facilities” to 2,000 acres, but leaves open the question of the distribution of these 2000 acres. The House bill also authorizes construction of a natural gas pipeline from the Alaskan North Slope to the lower 48 states, but allows the Federal Energy Regulatory Commission (FERC) – which must issue a certificate of convenience and necessity for construction of the pipeline – to do so only for a southern route through Alaska, a route to which conferees on H.R. 4 had informally agreed.
ANWR: The Last Refuge?
The Alaska National Interest Lands Conservation Act (1980) established the Arctic National Wildlife Refuge (ANWR). In section 1002 of that act, Congress deferred a decision regarding future management of the 1.5 million acre coastal plain ("1002 area") in recognition of the area’s potentially enormous oil and gas resources and its importance as a wildlife habitat. Drilling in this area began only after a report on resources of the 1002 area was submitted in 1987 to Congress by the Interior Department. The ANWR comprises 19 million acres out of which drilling is permitted in 1.5 million acres.
The proponents of drilling stress the need for increased self-sufficiency in natural gas production, so that a move away from coal can be speedened. The exploration would cover about 8% of the total area on the northern shore, leaving the other 92% untouched. If oil is discovered, less than 2000 acres would be affected. Additional employment of anything between 25,000 and 735000 would be created.
The main opposition stems from environmental considerations. Toxic and methane emissions, gas spills that contaminate the environment, encroachment upon the habitat of some of the most endangered species of wild and marine life like the bowhead whale are some of the issues that are obvious at first scrutiny. What the opponents fear most is the irreplaceable damage that will be done to one of the worlds last wildlife refuges. The laying of natural gas pipelines spanning the length of the State will inevitably lead to opening up of areas not within the drilling area. Drilling in remote corners of the Refuge will necessitate transportation infrastructure from areas of production to area of refining/consumption. And the main argument of self-sufficiency stands on wobbly legs: there is disagreement even among experts about the estimated oil reserves.
The Last Word Has Not Been Said Yet
In the Senate, action on comprehensive energy legislation is in progress. On April 3, 2003 the Energy Tax Incentives Act of 2003 was referred to the Senate Committee on Finance. The bill foresees incentives in the form of tax credits for energy produced from alternative sources, for measures undertaken to increase energy efficiency and for investments in clean technologies. Out of the roughly $18 billion in incentives over a 10 year period, $5 billion is targeted to the oil and gas industry, $2.6 billion to producers of renewable energy sources, $2.4 billion for alternative fuels and fuel cell vehicles, and $4 billion for utilities to implement electricity restructuring.
Most recently the Senate approved a plan to double the use of ethanol in gasoline to at least 5 billion gallons a year by 2012 and ban the use of MTBE. The measure introduced by Senator Bill Frist (R-Ten), the Senate Republican leader and by Senator Tom Daschle, his counterpart for the Democrats was approved 67 to 29. Supporters of the bill said that the measure would help energy independence by displacing up to 250,000 barrels of oil a day by 2012.
In a very surprising development on June 10th of this year Mr. Alan Greenspan, the Federal Reserve Chairman, expressed his worry before the Congress that short supplies and sharply rising natural gas prices could eventually contribute to 'erosion' in economy. The current price of natural gas at $6.4 per million Btu is 74% above last year’s level. At the same time, Mr. Greenspan said lawmakers should give new consideration to expanding the nation's capacity for nuclear power, a position that was narrowly embraced the next day by the Senate, which voted 50 to 48 to keep new federal loan guarantees for the construction of nuclear plants in the emerging energy bill.
Close on the heels of Mr. Greenspan’s testimony before the Congress, the Senate voted 54 to 44 to let the Interior Department measure the amount of gas and oil beneath the outer continental shelf. This is a victory for Messrs. Domenici and Tauzin, strong proponents of more offshore drilling. Legislators from Florida, California and other coastal states had successfully blocked new exploration along the coastline since the 80’s. Democratic Senator Bob Graham of Florida called the provision a “prelude to a direct attack”.
The Senate stood united on one front: more innovation from the country’s leader. It adopted by a vote of 99 to 1 the proposal by Senator Mary Landrieu, Democrat of Louisiana, to require the President to develop a plan to decrease oil consumption by 1 million barrels of oil per day within a decade.
Only The Beginning, Not The End….
As great as the needs of this country for energy are, so are the issues surrounding it complex. The need for an environmentally sound sustainable energy policy is widely recognised among lawmakers in the country. Many initiatives are under way, also in a global context. One such initiative is the recent U.S.- EU summit to create an international partnership to develop hydrogen energy.
In the coming issues of the Voices Newsletter we will present to our readers an overview of and latest developments on the many facets that make up the environment and energy policy of the United States, beginning with Clean Air and Clean Water.
Further Links:
Pew Center on Global Climate Change
U.S. Department of Energy
Energy Information Administration
Intergovernmental Panel on Climate Change
Physicians of Social Responsibility
Sylvia Pilz has a degree in law and is currently Junior Visiting Expert at the Office of Science and Technology. She can be contacted at pilz@ostina.org until September 2003.
Himangi Zanpure-Sattler is a Consultant at the OST. She is chiefly entrusted with the development of the Network of Austrian Scientists in North America. She can be contacted at zanpuresattler@ostina.org
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Hydrogen – The Ultimate Freedom Fuel?
by Stephan Neuhäuser
In a move to counter America’s increasing dependency on oil imports, President George W. Bush announced the “Hydrogen Fuel Initiative” early this year. He called for investment in technologies and infrastructure that produce, store and distribute hydrogen for use in fuel-cell vehicles and the generation of electricity. “Tonight I’m proposing $1.2 billion in research funding so that America can lead the world in developing clean, hydrogen-powered automobiles…. Join me in this important innovation to make our air significantly cleaner, and our country much less dependent on foreign sources of energy,” the President said in his “State of the Union” address on January 28, 2003. The “Hydrogen Fuel Initiative” is embedded in the wider framework of the “Energy Bill” currently under consideration in the U.S. Senate.
“Sometimes We Import Oil From Countries That Don’t Particularly Like Us”
It is a well-known fact that the United States relies heavily on foreign oil. Imports have risen to 55 % of the overall petroleum demand. The U.S. Department of Energy predicts imports climbing as high as 68% during the next two decades. Transportation accounts for nearly two thirds of the 20 million barrels of oil Americans use each day. The U.S. Department of Energy estimates that without a change in direction, the U.S. economy will face costs of $188 billion per year for oil imports of more than 19 million barrels per day by 2025. Given the importance of oil to the U.S. and the instabilities in major oil exporting regions in the Persian Gulf, Northern Africa and South America, dependency on foreign oil poses a potential risk to U.S. security. President Bush put it this way last February: “Sometimes we import oil from countries that don’t particularly like us”. At an opening ceremony for a fuel-cell test site, Senator Bob Inouye from Hawaii was recently quoted in California’s Pacific Business News as saying that oil has been at the root of most U.S. military conflicts in the last few decades.
Hydrogen: How Does It Work?
Referring to the two major energy-related issues of oil dependency and environmental protection, President Bush recently explained that “the idea is to see that a car born today – I mean, a child born today will be driving a car, as his or her first car, which will be powered by hydrogen and pollution-free.” Spencer Abraham, U.S. Secretary of State for the U.S. Department of Energy, even called hydrogen “our ultimate freedom fuel.”
To be precise, hydrogen itself will not fuel future generations of cars, but rather with the electricity produced by fuel cells that use hydrogen and oxygen to create current. The fuel cells themselves are environmentally clean and emit only heat and water. However, the environmentally crucial question remains: how should the hydrogen be produced? One of the most common methods involves reforming natural gas. Several other methods include the transformation of biomass or coal into a gas from which pure hydrogen can be generated, biological systems using microbes, thermal water splitting, solar- and wind energy, etc…It currently appears as if natural gas and coal will become the United States’ first choice for hydrogen production (cf. the announcement of the “FutureGEN” project by Energy Secretary Spencer Abraham on February 27, 2003).
The main reason hydrogen fuels are not widely used today is because of the high costs associated with them. In the 1960s, power produced by fuel-cells cost $600,000 per kilowatt-hour. This only paid off in the U.S. space program. Hydrogen is still considerably more expensive than the fuels it would be meant to replace. Commercial systems available today average prices up to $4,500 per kilowatt-hour (United Technology Corporation’s “commercial phosphoric acid fuel-cell power plants”). In comparison, one kilowatt-hour produced from conventional sources is currently available for an average price of 7¢ in the United States. However, at a briefing on “Alternative Hydrogen Futures” on March 28, 2003, Robert Olsen, Research Director at the Washington, D.C.-based Institute for Alternative Futures, said that costs for hydrogen-based fuel-cells are predicted to drop significantly by the end of this decade, which will make them competitive for most types of power applications.
Demonstration Projects And First Steps Towards Commercialization
Nevertheless, small fleets of fuel-cell powered cars are already on the road today for demonstration purposes throughout California. Also, North America’s largest commercial fuel-cell power plant was added to the power grid by the Los Angeles Department of Water and Power on March 14, 2003. The $3 million “John Ferraro Building Fuel-Cell Power Plant” uses natural gas to produce hydrogen and provides power to only 250 homes at costs five times higher than traditional power. However, the project is seen as an investment in the future, forging the way for ultra-clean energy production in Los Angeles. A second fuel cell power plant currently under construction in Los Angeles will supply renewable power by utilizing digester (is this the correct word? I don’t know it.) gas from a nearby wastewater treatment plant.
How Much Money? Who Will Be In Charge?
The “Hydrogen Fuel Initiative” proposed by President Bush to develop the technologies and infrastructure to produce, store and distribute hydrogen for use in fuel-cells. It is part of the “Energy Bill” that is currently on the docket for consideration and approval in the U.S. Senate (see this issue's article The Politics of Energy
by Sylvia Pilz and Himangi Zanpure-Sattler)
The “Hydrogen Fuel Initiative,” which includes $720 million in new funding over the next five years, adds to the $500 million research program “FreedomCAR Program” announced in January 2002 by the Bush Administration to develop fuel-cell powered vehicles. “FreedomCAR” (CAR stands for “Cooperative Automotive Research”) is a research partnership between the government and car manufacturers including Ford, General Motors and Daimler/Chrysler. It replaces an earlier initiative – the Partnership For The Next Generation Vehicles (PNGV) – begun under the Clinton Administration. Both the “Hydrogen Initiative” and the “FreedomCAR program” will be run by the Department of Energy (DOE) over the next five years.
The Ideal Scenario: Full Transition To A Hydrogen Economy by 2040
In 2001, the Department of Energy began working on a hydrogen vision and road mapping effort. It led to the release of the “National Hydrogen Energy Technology Roadmap” in November 2002. The roadmap describes the steps required to make a successful transition to the “hydrogen economy.” In his testimony before the House Committee on Science, David K. Garman, Assistant Secretary for Energy Efficiency and Renewable Energy at the DOE, outlined four phases the Department of Energy believes are necessary for the United States’ eventual transition to a “hydrogen economy:”
Phase 1 is already underway with government and private organizations completing research on hydrogen-related topics. The results should enable industry to make a decision on commercialization of hydrogen-powered vehicles by 2015. Transition to the marketplace during Phase 2 could begin as early as 2010 for portable and some stationary applications. Wide-scale marketing of fuel-cell vehicles might start around 2020. Phase 3 would allow the U.S. government to further supportmarket growth by taking the role of an “early adopter” (meaning that government agencies would switch to fuel-cell technologies as early as possible) thus stimulating the market. Phase 4 should begin about 2025 whenglobally competing industries would begin receiving adequate returns on their investments. Ideally, the DOE hopes America’s transition to a full hydrogen economy would be complete by 2040.
“People Aren’t Going To Buy Many Cars If They Can’t Refuel Their Car.”
Despite the DOE’s positive scenario, there is a very real possibility that these benefits might not be achieved, as Robert Olsen from the Institute for Alternative Futures points out. The creation of an adequate infrastructure for hydrogen distribution and storage could be a major obstacle on the way towards the hydrogen economy.
“There would be nothing worse than developing a car and having no place for somebody to find the fuel. People aren’t going to buy many cars if they can’t refuel their car,” President Bush recently explained. The Department of Energy supports this view and DOE’s David Garman warns of this possible stumbling block: “Our current gasoline/hydro-carbon infrastructure has been forged in a competitive market. It is ubiquitous and remarkably efficient. It can deliver refined petroleum products that began as crude oil half a world away to your neighborhood for less than cost of milk, drinking water, or many other liquid products you can buy at the supermarket. We are currently bound to that infrastructure. We have no alternative. Eventually replacing it with something different will be extremely difficult. But that is what we must do if we expect to achieve success with the FreedomCAR partnership. Drivers must be able to go anywhere in America to refuel their hydrogen-powered vehicle before they will be comfortable purchasing one”. Coincidentally, California has already begun developing plans for a “hydrogen highway” of refueling stations from Mexico to Oregon (see Fuel-Cell Caravan In Central Valley - Hydrogen Car Rally Promotes Technology, The San Francisco Chronicle, May 15, 2003).
A Dirty Energy Plan?
“As we act on President Bush’s National Energy Policy, we are focusing on next generation technologies that expand the diversity of America’s supply of energy and ‘leap frog’ the status quo,” Spencer Abraham said in the preface to the National Hydrogen Energy Roadmap. It is precisely this “leap-frogging” that skeptics are criticizing about the Bush Administration’s “Hydrogen Fuel Initiative” and the “FreedomCAR Program”.
The Union of Concerned Scientists (UCS), the Ecological Society of America (ESA) and other environmentally-aware organizations see the hydrogen-related activities of the Bush Administration as a diversion from short-term measures that could make a big difference right away. A $1.5 billion initiative by the Clinton Administration aimed at making cars fuel-efficient, raising fuel economy standards and setting tougher emission standards was abandoned by the current administration. Indeed, increased funding for hydrogen-related initiatives comes largely at the expense of other energy-efficiency and renewable energy programs. Robert Olsen thus perceives a certain danger of hydrogen losing political support “by the way U.S. efforts to promote it got off on the wrong foot with environmentalists.” This would especially be the case if the hydrogen R&D programs are denounced as a “dirty energy plan,” provided that much of the research is focused on methods of producing hydrogen from oil, coal and nuclear power.
Transatlantic Cooperation
A means to avoid losing support for research on “hydrogen fuel” is to take a global view and embark on international cooperation. After all, geologists estimate that global oil production will begin to decline somewhere during the period from about 2015 and 2030. Formalized international research cooperation on hydrogen technology would indeed create a fait accompli.
“Hydrogen is certainly one of the most important and promising areas we must develop in the coming years. I believe this is an area where both the U.S. and the E.U. would benefit from cooperating notably on our research programs and demonstration projects,” the European Commission’s Vice President Loyola de Palacio said after meeting with U.S. Secretary of State for the U.S. Department of Energy Spencer Abraham on May 1, 2003 in Madrid. Like the United States, the European Commission has also named research on hydrogen fuel technology one of its main priorities in its energy and transport policies. The E.U. has thus begun to implement a project called Clean Urban Transport for Europe (CUTE). CUTE is aimed at supplying 10 major European cities with fuelcellpowered buses for public transport. It is the first project of its kind worldwide. Another world premiere will be the launch of German-built “U 31” – the world’s first fuel-cell powered submarine – in July 2003.
As a direct result of all this varied activity, the transatlantic dialogue on hydrogen research has increased in the recent months. After a meeting with the European Research Commissioner Philippe Busquin on March 6, 2003, Spencer Abraham announced that the European Commission and the United States would shortly be signing an annex to the current cooperation agreement in order to formalize research cooperation on hydrogen fuel technology. During their meeting on May 1, Loyola de Palacio, who is responsible for energy and transport policy within the European Commission, and Spencer Abraham agreed upon increased transatlantic cooperation in policy development, research cooperation and coordination, common positions in international fora and common evaluation criteria for demonstration projects – all in the field of hydrogen fuel technology.
The Mysterious Island
If all the challenges and obstacles are overcome, then Jules Verne’s prophetic words in The Mysterious Island (from 1874) might well come true in the near future:
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