Telling the Truth About Oil, Wind, and Water

With the news these days dominated by Michael Phelps winning Olympic gold medals, John Edwards confessing to marital affairs, and Paris Hilton deciding to run for president, I barely even want to know the details of Russia’s recent invasion of Georgia – its neighbor to the south. Russia isn’t even a super-power anymore, and from what I hear, they’re just acting out some leftover anger from the Cold War days. It’s not like Georgia has any oil, does it?

Well, it turns out that underneath the story we’ve been hearing about Russia’s invasion of Georgia, there’s another story. It’s a story about a couple of oil-thirsty countries – the United States and Great Britain, and their plan to loosen Russia’s grip on the rich oil reserves beneath the Caspian Sea. President Clinton, working with Bechtel, British Petroleum, the World Bank, and others, created a plan to build an oil pipeline connecting the Caspian Sea to the Eastern Mediterranean. The idea was that the 1,100-mile pipeline across Georgia would bypass Russia. Well, Russia wasn’t too happy about that, so we gave Georgia hundreds of millions of dollars in military aid, and promised that we would back them if they ever got into trouble. So, here we are, two years after the pipeline began operating, trying to convince Russia not to bomb it into oblivion.

Somehow, with petroleum, we always seem to tell a story that’s not quite the real story. Like when we set out looking for weapons of mass destruction, and came back with a bunch of no-bid oil development contracts. Or when we claimed that the rise in oil prices was just “speculation”, and never mind the fact that after 100 years of pumping, the world’s oil wells are getting kind of tired.

Our habit of not telling the real story isn’t limited to petroleum – it’s rampant throughout the energy industry. Like when T. Boone Pickens, the legendary oil barren, tells us about his plan for wind power but neglects to mention that the transmission corridors for his power lines are really intended for water pipelines. See, he’s got another plan (one that doesn’t have a website), in which he drains the Ogallala Aquifer and pipes all that water to Dallas and other cities in Texas. I can’t really blame him for not talking about it…nobody would ever approve condemning land and seizing it through eminent domain so that a billionaire can create a monopoly on drinking water!

Typically, when someone repeats a pattern of not telling the real story, it’s a sign of addiction. But even as we admit that we have an addiction, we aren’t being completely honest. We’re not addicted to oil, we’re addicted to all the things that oil lets us do—like, live way out in the suburbs and drive into town whenever we need anything. With oil, we don’t even need to talk to one another. The main thing that petroleum gave us was freedom from the responsibilities of community. In a community, we all agree to provide for one another’s needs. You grow vegetables, I’ll harvest firewood, you weave fabric…oh, to hell with all that…we’ll just get it all from Trader Joe’s.

So here’s my proposal: instead of telling stories about all the great new energy technologies we’re getting, let’s talk about how we are going to implement them in ways that rebuild community, and recreate local self-reliance. If we don’t approach it that way, we run the risk of ending up just as dependent on the same big-moneyed, outside interests that dominate us now – only, it’ll all be powered by solar and wind. Big deal!

The real opportunity of the new energy paradigm is that building it can bring us back together as a community. But for that to happen, we need to build it with local resources, and employ locally owned, independent energy businesses. Then we can proudly tell the real story of how it all happened, instead of making up stories about Paris Hilton running for president.

This commentary aired on KUNM on August 18, 2008. To listen, click here.

By Protecting Utilities, We Make Communities Vulnerable

“Revenue Decoupling” programs are the latest in a long series of egregious schemes designed to prop up an electric-utility industry that is long overdue for a restructuring. Such programs are the brainchildren of respectable sounding organizations like the Edison Electric Institute and the Electric Power Research Institute, whose memberships are made up of our nation’s most powerful electric utility companies. Both organizations are now chaired by the same man – Jeff Sterba, who is also the head of PNM, New Mexico’s largest investor-owned utility.

New Mexico passed a utility revenue decoupling bill earlier this year, under logic that went something like this: Electric utility companies earn their revenues from the sale of energy, but as consumers become more efficient, sales decline. Therefore, helping consumers become more energy efficient is counter to the utility’s interest. To fix that, we simply decouple the revenues of the utility from the amount of energy purchased by their customers.

Once this decoupling is in effect, the utility can then set up energy efficiency programs to help their customers use less energy. The cost for the utility-run efficiency programs are paid by customers, through surcharges on their utility bills, and the utility is also entitled to collect money to pay for lost revenues resulting from selling less energy.

Does that make sense? The logic was good enough to receive the endorsement of the Obama campaign: His energy platform specifically endorses revenue decoupling, and promises grants and assistance to states that implement them.

But, here’s another perspective:  The real name for such programs should be “Revenue Guarantees”. As residents of a community begin to suffer from higher energy costs, the most powerful tools they have are to reduce energy use, or switch to a different energy source. Either option should reduce the flow of energy dollars leaving the community to pay the electric company.

But with a revenue decoupling law, the savings enjoyed by one resident are simply billed by the utility to the other residents, pitting one community member against another and ensuring that the community, as a whole, continues handing over large sums of money to the utility. As utility prices rise, the sums of money get larger, no matter what the residents do to reduce their use.

We must hope that revenue guarantee laws like the one passed this year in New Mexico will be the over-reach that wakes us up to the perverse power of monopoly electric utilities. Our revenue guarantee law was, in fact, cited by Santa Fe County Commissioner Paul Campos as one of the reasons for his initiative to create a public power entity in Santa Fe. And, public ownership of power lines is probably the best of our remaining options for curbing the abuse of our political system by electric utilities.

As our country spirals deeper into economic hardship, the potential to create jobs, renewable energy, and other benefits from taking the electric grid public, and operating it in the public interest, are simply too big to ignore.

The video newscast that includes this commentary is posted here.