Posts

Make love, not war — a national dialogue on alternative fuels

Remember the passion, the commitment and vigorous national dialogue concerning the Vietnam War, the civil rights movement and the women’s movement? No matter how one viewed the issues involved or whether one was pro or con with respect to each initiative, most of the nation, even if only watching the 6 p.m. and 10 p.m. news, seemed involved, to some extent, emotionally and many intellectually.

Given the concern many Americans seem to have for the future of the environment, the nation’s security problems and the sluggish economy (not to mention shrinking pocketbooks), why haven’t we been able to replicate the intense passions and commitments of the ‘60s and early ‘70s with respect to the muted debate over alternative transitional fuels. Very few articles in the press or on cable and TV headline the wisdom of efforts to reduce America’s dependence on gasoline through providing increased consumer choices at the pump. Those that do approach headline or first-tier status suggest, generally, often without hard analysis, that increased oil and gas production (Saudization of America) will grant the U.S. oil independence, forgetting the global nature of the oil market. The media has not focused on the costs of continued reliance on imported oil and the very restricted American vehicular fuel market limiting consumers, by and large, to costly, dirty gasoline. In-depth coverage of alternative non-renewable fuels as substitutes for gasoline and as transitional fuels before renewables are ready for prime time is rare and most times, more opinion than fact. Even the venerable New York Times rarely covers alternative transitional fuels in the context of an overall assumed national commitment to “wean” the nation off of gasoline.

Why haven’t the public and the media become involved in a real dialogue concerning the benefits and costs of alternative fuels versus continued reliance on gasoline?

I think it’s a bit of a chicken-and-egg question. Recall the intense TV coverage of Bull Connor’s vicious attack using dogs and high pressure hoses on kids in Alabama and the nobility of Martin Luther King Jr.’s 1963 speech on the mall? Both gripped us and made civil rights a moral issue. Remember TV’s extensive coverage of the marches by mostly young but also many older folks opposing the Vietnam War? And who could forget the photo of the little girl walking alone on the highway with her clothes burned off from a napalm attack and the many movies portraying G.I. casualties? It was difficult to stay neutral concerning the war, particularly if our kids or the neighbor’s kids were involved. Finally, while some Americans disagreed with them, the women’s movement had visible charismatic leaders like Gloria Steinem, Bella Abzug and Betty Ford, who had a knack for getting on TV and in newspapers to champion the need for women’s equality. Over time, they reached many of us, and if we didn’t join the movement, we argued for its success.

President Obama’s State of the Union speech was greeted with popular applause when he said we must get off of oil, but the line concerning the need to wean us off oil seem to have a shelf life of 24 hours…or maybe 48 hours. It clearly didn’t move the needle much in public interest and the public’s attention understandably turned to more media-friendly issues, such as Washington’s dysfunctional character, the budget, the debt ceiling and the Middle East.

Anti-Vietnam sentiments, civil rights and women’s rights were internalized by a relatively large, but still a minority, sector of the public. Participants in the effort to secure change viewed the three issues as affecting them personally and, for the most part, crossed class and caste lines, a fact that was deepened by the draft with respect to Vietnam. Although none of the three probably could have secured a majority vote,if placed on the ballot initially, they each grabbed the attention of most Americans over time.

Looking back, clearly the sustained involvement of a relatively cohesive minority of the public led by aggressive leadership created significant political and policy reforms. Issues were cast in terms Americans could easily understand — securing justice, freedom and a better America. They created a strong moral underpinning to proposed actions. Ultimately, grassroots support convinced key elected leaders that they could move positively without retribution to secure respective agendas.

Enveloping alternative fuels and the monopolistic gasoline markets in moral tableaux will not be easy. The issues involved are complex and don’t, without effort, engage people for more than short periods of time. They are tough to convert to brief TV or cable spots. Try going to a dinner party and raising moral variables around the reality of limited choices of consumers at the pump. Yawn…don’t expect a return invitation! Similarly, the fact that low-income households pay nearly 15% of their income for gasoline and are therefore limited concerning purchase of other basic goods does not easily translate into visual and visceral understandable, personal moral pictures. Similarly, despite the data showing increasing harm to the poor regarding the journey to work and constrained housing choices caused by high costs of gasoline, aggregate statistics blur individual problems. The economy’s overall sluggishness and its impact on most Americans, except the very affluent, divert focused attention. Happily, there is no Bull Connor, and your neighborhood gasoline station owner is often from the community. It’s difficult to make him or her an ogre. He or she is generally a hard-working individual and is struggling to make ends meet. Even the most vigorous advocates of alternative fuels and open fuel markets have yet to figure out how to vividly personalize the negative impact of the constraints imposed on the market by the oil industry on consumers, particularly low income consumers. Black hats and mustaches (whether painted in graphics or narratives) to describe the oil industry’s leadership, hasn’t worked well. Where is Norman Rockwell when we need him?

The phrase “we need all of the above” is used often in a bipartisan way by our political leaders to describe the nation’s energy strategy. The phrase may well be true, but it is difficult to get excited about it. Try it on your husband, wife or significant other tonight and see if it motivates a meaningful response. “Hey, honey, there is a meeting tonight of people interested in energy reform. The expansion of alternative fuel choices will be at the center of a strategy to grant priority to all our energy sources — coal, oil, natural gas, bio fuels, derivatives of each. It’s important. Do you want to go?” Probable response: “Are you serious? You were so romantic when I met you. What happened?”

The messages related to Vietnam, the civil rights movement and the women’s movement, at the time, were simplified into understandable, often emotional, terms. They were complemented by extensive media coverage and by strong moral certitude of both presenters and listeners. Parsed words and nuanced sentences were not often needed to convince folks to join the causes. The coalitions that were created put in hard work and lots of sweat equity to build and generate grassroots efforts. But the people were out there waiting to be recruited. While members might have disagreed on strategic policy options, they were generally together on broad objectives.

The effort to secure alternative transitional fuels and open up the gasoline market does not lend itself easily to the type of grassroots initiatives generated in the ‘60s and early ‘70s. The messages and data used to support them are seen as too complicated and, frankly, confusing to potential grassroots participants. In this context, the oil industry and its captive groups like the American Petroleum Institute (API) have big budgets and have seen fit to use their resources seemingly to confuse and distort information concerning gasoline and alternative fuels.

I am not sure a passionate grassroots movement can be created to support alternative fuels. At best, it will be difficult. But, democracy works in many ways. Progress is being made in forging working alliances among advocates of alternative fuels and leaders in the business, environmental, public sector and academic communities. Their ability to form sustainable, strong alliances will increase their likely ability to influence public policy concerning transitional fuels and open fuel markets. Building public understanding, combined with political acuity and a willingness to reach out to varied groups, will increase the odds of success in winning political, legislative and statutory support. Much will depend on their collective willingness to depart from traditional divisive ideological and institutional focus. Their leadership, borrowing the rhetoric from the Vietnam War, will probably have to learn how to make love, not war, in developing a collaborative agenda.

Can the Marcellus give birth to CNG vehicles?

What if America had so much natural gas it didn’t know what to do with it?

Right now that’s the situation in the Marcellus Shale, the vast formation that underlies nearly all of Pennsylvania. There just isn’t enough demand for what’s available. And the same situation could be facing the entire United States in just a few years, according to speakers at the 2013 Natural Gas Utilization Conference held at the Omni William Penn Hotel in downtown Pittsburgh last week.

“Today there are 800 shut in wells in the Marcellus, waiting for an increase in price and improvements in infrastructure,” said Justin Carlson, manager of energy analytics at Bentek Energy of Colorado told the gathering. “By 2017, demand could dip below supply for the entire United States. We’re not doing enough to support growth. The market needs more users.”

Where could you find those new consumers? Virtually everyone agrees that there’s one market that is begging for greater natural gas use – the transportation sector.

Some companies are already looking for ways to do it. Last year Consol Energy Inc. and Praxair, Inc., a Connecticut-based manufacturer of industrial gases, was preparing to build a $2 billion plant to convert gas from the Marcellus into gasoline and diesel blends for use in cars and trucks. In the end, however, the economics didn’t quite work. “The project would have generated a positive rate of return but not the 12% that investors are looking for,” said Dante Bonaquist, chief scientist and corporation fellow at Praxair, who spoke at the conference. “We had to give it up.”

So absent a liquids option, most gas producers are opting for another technology – compressed natural gas. Leading the pack has been Chesapeake Energy, which set a goal to convert its entire fleet of vehicles to CNG by 2015. At the current pace it will hit the 80% mark in 2014. Last year Chesapeake’s Peake Fuel Solutions affiliate also partnered with GE to launch “CNG In A Box,” a package that compresses natural gas from a pipeline into CNG fueling stations so that small and large retailers can become vendors of natural gas. The package was introduced at the National Association of Convenience Stores 2012 annual convention.

“The 8-by-10-foot container is easy to ship and its modular design allows for plug-and-play,” said Bob Jarvis, spokesman for Chesapeake. “It makes pay-at-the-pump a familiar and secure experience.” GE already has a manufacturing plant up and running in Houston. On Sept. 17 it announced a memorandum of understanding with China’s Endurance Industries to deliver 260 CNGs In A Box to fuel China’s rapidly growing conversion to natural gas vehicles.

Last week, however, Chesapeake was forced to disband its seven-member Natural Gas Vehicle Task Force as part of an austerity-driven reorganization. But other companies may pick up the slack. “Chesapeake has been an important player in growing the natural gas vehicle market, but other companies and organizations have taken on that role now,” said Rich Kolodziej, president of advocacy group Natural Gas Vehicles for America.

Range Resources, another major player in the Marcellus, is also making an all-out effort to promote CNG vehicles. It recently closed a deal with GM to buy an entire fleet of trucks for its Pennsylvania operations. The company expects to save 40-50% of vehicle operating costs by switching from gasoline. With 180 trucks in the region, each carrying a 17-gallon tank, Range will save $3,000 each time its fleet refuels.

But is compressed natural gas the best way to go? The technology involves high-pressure tanks, both in storage and in your car or truck and involves a whole new infrastructure. Converting natural gas into methanol – a fairly simple process – would allow us to use the current infrastructure with only a few minor adjustments. Existing vehicles can be modified to use methanol for only a few hundred dollars and flex-fuel vehicles could use either methanol or traditional gasoline.

Methanol works better from the supply side as well. “The economics of methanol would have been more attractive,” said Bonaquist, of the Praxair-Consol Energy proposal that didn’t make it off the drawing boards. “The conversion and purification sections of the plant would have been less complex. It would have been particularly advantageous for smaller scale production.”

So what’s the problem? Well, unfortunately, putting methanol in your car hasn’t yet been approved by the Environmental Protection Agency. That makes it illegal. If the regulations could be changed, methanol would become a much easier route for moving the nation’s looming gas surpluses into the transportation sector. There could hardly be a more promising way of freeing ourselves from dependence on foreign oil.

When California had 15,000 methanol cars

Do you realize that California once had 15,000 cars on the road burning methanol? And that those drivers loved their performance? But that whole experiment came to an end ten years ago because – get this – natural gas was too scarce and expensive.

In an era when natural gas is cheap and plentiful – when people in the industry are warning that wells may soon be shutting down because there isn’t enough demand for the product – it may be worth going back and taking a second look at what happened in the Golden State from 1988 to 2004.

California, of course, has never been shy about pushing new technologies. At various times the state has pioneered renewable energy, mandated zero-emissions vehicles (electric cars) and tried to establish a “hydrogen highway” for fuel-cell vehicles. Not all these efforts have succeeded, and a few have been notable failures. But the methanol experiment, oddly enough, was fairly successful. Now, at a time when it could be seen as prescient, it is largely forgotten.

The project began way back in 1988, when memories of the 1970s energy crisis were still fresh, and various senators were looking for ways to plug their state economies. The impetus came from a joint effort by Sen. Jay Rockefeller of West Virginia and Sen. Tom Daschle of South Dakota. Rockefeller was looking for a way to promote his coal economy, while Daschle had his eye on farm wastes.

The ethanol-from-corn effort was already up and running, but both Rockefeller and Daschle recognized that methanol might work just as well, and that their home states could benefit. Methanol, after all, can be derived from coal, biomass or natural gas. The result was the Alternative Motor Fuel Act, signed into law by President Reagan in 1988, which provided a waiver of EPA regulations to allow methanol to be used in cars. A year later, President George H.W. Bush became an enthusiast, promising to put 500,000 methanol cars on the road by 1996 and a million by 1998.

Such presidential promises are often wildly exaggerated, but Ford Motor Co. took up the challenge and produced a Taurus model that could run on 85 percent mixes of both ethanol and methanol. This came at a time when gasoline had become cheap again, however, and there wasn’t much interest around the country in alternative fuels. But California took the initiative.

Mike Jackson, who was the lead technical advisor for the California Energy Commission and now works for Fuel Freedom, recalls the experience:

“The original justification was petroleum displacement in response to the 1973-74 crisis, but you learned fairly quickly that that wasn’t sustainable. But we realized there were air quality benefits, so we shifted in that direction.”

The state partnered with Ford and Volkswagen, agreeing to set up a string of fueling stations if they would bring out cars capable of running on methanol. Then the state started buying methanol vehicles for its various fleets. ”

“It was a technical success, but an emotional failure,” Jackson said. “The biggest problem was range anxiety. There were only 10 fueling stations at that time, and it just wasn’t enough. There were times when people abandoned the cars on the freeway because they were afraid they were going to run out of gas.”

Then Roberta Nichols, head of the research and development effort at Ford, came up with an idea: Ford would produce a flex-fuel vehicle (FFV) that could run interchangeably on a variety of fuels. The car could handle blends of 85 percent ethanol or methanol but could switch to gasoline if necessary. Ford produced a Taurus FFV, and the program once again went into high gear. The clean air benefits were adding up, and the state started to consider ratcheting down the NOx requirement to the point where the oil companies would have to add methanol or ethanol in order to meet them.

Suddenly, the oil companies stunned the state by announcing that they would be able to meet the standard by producing a new “blended” fuel.

“Everybody’s jaw dropped,” Jackson said. “Why hadn’t they mentioned this before? But they said they could achieve the same thing by adding MTBE, which is methanol-based, so that was it.”

The MTBE additive created a new problem for methanol. Since methanol was one of the feedstocks for the production of MTBE, supplies began to be diverted, and it became more expensive to use as a substitute fuel. However, MTBE eventually came under pressure because it was getting into drinking water. California and New York banned it in 2004, and most states quickly followed suit.

By that time, ethanol was going strong, with more and more of the corn crop diverted into its production, and the 10-percent ethanol blend became the substitute for oxygenating fuel and reducing NOx emissions.

“We ended up with cleaner gasoline technology,” Jackson said. “But we lost sight of the idea of methanol as an oil substitute.”

By this time, the country had fallen into the “Fuel of the Year” syndrome. Hydrogen had a big run in the late 1990s. Then, after the turn of the century, it was the electric car. Somehow methanol got lost in the shuffle. California’s program limped along until 2004, when the state finally abandoned it. With natural gas selling at $7 per mBTUs and peaking as high as $11, it didn’t seem to have any future.

Now, with natural gas supplies flowing in surplus, the California experiment suddenly seems far ahead of its time. Methanol made from natural gas at $3.25 per mBTU could sell at nearly half the price of gasoline made from $100-a-barrel oil. Methanol from coal could revive the flagging fortunes of the coal industry. Methanol reformed in the field could solve the problem of flaring in the Bakken Shale, which now wastes the equivalent of one-quarter of U.S. gas consumption every year.

Yet the methanol initiative is now largely forgotten. And of course, there’s always the problem that EPA regulations do not allow it to be used in automobiles. With natural-gas surpluses now at the point where a national oversupply is being predicted for 2017, however, it may be time to go back and give the California experience a second look.

The oil industry and API, at it again. When will they ever learn?

Never a dull moment! The API is at it again. Just a few days ago, it dramatically issued a survey indicating that close to 70% of all consumers were worried that E15 (a blend of 15% ethanol and 85% gasoline) would damage their cars. While the survey was done apparently by a reputable firm, it was not attached to the press release, preventing independent experts or advocate group experts from commenting or verifying the questions and the sample. More importantly, the survey was preceded by an expensive oil industry media blitz that illustrated or talked about the so-called evils of ethanol. The survey and media show reflected an attempt by the oil industry to eliminate or weaken the renewable fuel mandates and lessen competition from alternative transitional fuels.

Americans are usually not Pavlovian in demeanor or behavior; we do ask for second and even third opinions from our doctors. But when only one group, in this case, the oil industry, has put out a continuous flashy very expensive multimedia message, the API’s survey results were almost preordained to reflect the published results. Whatever the industry wanted it got! If you tell a misleading partial story to create fear and uncertainty, long enough, it will likely influence many. In this case, the API, if it had a nose, its nose, similar to Pinocchio’s, would be growing and growing and growing.

Let’s look at the facts — never acknowledged by the API in its “Fuel for Thought” campaign.

  1. DOE effectively demolished the API-supported study many months ago indicating that the sampling approach was wrong and the analysis was faulty. DOE’s study used a much larger number of vehicles and was far more rigorous concerning methodology. (Just to let you know, API is an oil industry funded group.)
  2. Many countries around the world have used E15 and higher ethanol blends as a fuel without significant problems. They are seen as a way to reduce environmental problems. They are cheaper than gasoline and they reduce the need, at times, for oil imports. Put another way, they improve quality of life, lower costs to the consumer, and are good for the economy and security.
  3. Although oil company franchise agreements with gas stations have limited the number of stations able to sell E15, several states (mostly in the Midwest) with multi-fuel stations, have demonstrated the merits of E15. Early data appears to discount engine problems.

Hell, Henry Ford’s initial car was designed to run on pure ethanol until the temperance movement supported by Standard Oil banned the use of manufactured alcohol. I know Standard Oil was very concerned that Americans would drink ethanol at their favorite bars or in front of their favorite fire place with their favorite significant other. Praise be to Standard Oil for salvation!

The law (RFS) requires a 10% ethanol blend with gasoline. More than a year ago, EPA OK’d the sale of E15 (for most cars particularly those produced after 2001). In June, the Supreme Court refused to hear the appeal by the oil industry of EPA’s standards.

API’s media campaign raises the food versus fuel fight canard because ethanol is produced mostly from corn as the feedstock. But the narratives neglect to raise the fact that the evidence concerning the negative impact on food is disputed by reputable analysts who indicate that, for the most part, the corn used for ethanol production is not your friendly grocery counter corn. Put another way, most of the corn to ethanol conversion comes from corn not able to be used for food. Yes, there still maybe some impacts on corn production and prices because of the growers reallocation of land, in light of the differential between corn and ethanol prices, to ethanol. However, many studies suggest that if a negative food impact exists, it is relatively minor. It is a worthy debate.

It appears, that API, conveniently, forgets to mention that ethanol can be produced efficiently and effectively from natural gas and that cellulosic based ethanol is now being manufactured or will soon be manufactured in large volumes by several companies. Further, Clean Energy Fuels announced this week that it will start selling fuel made from methane in landfills and other waste sources in over 40 stations in California. Success of these initiatives, likely, will mean the end of the fuel versus food issue. If success is combined with the inexpensive conversion of existing cars to flex fuel cars permitting them to use alternative fuels, America will be blessed with a much cleaner, environmentally safe, and cheaper alternatives to gasoline- assuming the oil industry doesn’t block their sale at fuel stations.

Clearly, the oil industry does not want competition at the pump from ethanol…whether corn, cellulosic, garbage or natural gas. The American public should be wary of misleading guerilla marketing through industry funded surveys or not so benign expensive media blasts by captive organizations like API. Hopefully, the American consumer will not be confused for long. Paraphrasing a song by Peter, Paul and Mary about war and peace and a statement by President Lincoln, when will the oil companies ever learn?, and, if they don’t learn, when will they recognize “they can fool all the people some of the time and some of the people all the time but they cannot fool all the people all the time.”

Robert Rapier loves methanol

Robert Rapier – “R2” as he calls himself in good scientific notation – is one of the smartest people out there when it comes to energy. A master’s graduate in chemical engineering from Texas A&M University, Rapier is chief technology officer and executive vice president for Merica International, a renewable energy company. He also writes a regular column at EnergyTrendsInsider.com.

And he is a big enthusiast of methanol.

In a series of recent columns, Rapier has made a strong case that methanol is our best option for replacing foreign oil. He believes it can be done cleanly and in a way that also reduces carbon emissions. Unfortunately, one of the biggest impediments, according to Rapier, is the huge political momentum behind corn ethanol, which he regards as an inferior fuel. He is also highly critical of the biofuels effort, which has attracted so much attention in the form of venture capital from Silicon Valley.

“You can buy methanol today for around $1 per gallon,” he said. “This is a big, well-established business that does not receive heavy subsidies and government support as ethanol does. On a per BTU basis, unsubsidized methanol costs $17.61 per million BTUs. You can buy ethanol today – ethanol that has received billions in taxpayer subsidies – for $1.60 per gallon. On a per BTU basis, heavily subsidized and mandated ethanol sells for $21.03 per million BTUs.”

Yes, you read that correctly. We are paying 20% more for ethanol, enabled via highly paid lobbyists, heavy government intervention, taxpayer funds and protectionist tariffs than we are for methanol that has long been produced subsidy-free.

Unfortunately, the decision to mandate ethanol consumption while ignoring methanol has been based much more on politics than on the two fuels comparative advantages. “The fact is, methanol simply has not had the same sort of political favoritism, but is in [Rapier’s] opinion a far superior option to ethanol as a viable, long-term energy option for the world.”

Where biofuels are concerned, Rapier states that the effort has always been predicated on the assumption that we will eventually switch from corn ethanol to much more abundant, non-food cellulosic feedstocks such as switch grass. We just have to wait until somebody comes up with a way to break down cellulose. What investors do not seem to realize is that techniques for breaking down cellulose have been around since the 19th century. They just have proved to be too expensive.

But “high costs have never been a deterrent for Silicon Valley entrepreneurs who wielded Moore’s Law as the solution to every problem. In their minds, the advanced biofuel industry would mimic the process by which computer chips continually became faster and cheaper over time. But advanced biofuels amounted to a fundamentally different industrial process that was already over 100 years old. A decade into this experiment it is clear that Moore’s Law isn’t solving the cost problem.”

(Actually, if you read George Gilder’s latest book, “Knowledge and Power,” you would realize that mathematicians such as Claude Elwood Shannon and John von Neumann have determined that information as an entirely separate entity from energy and matter. Moore’s Law applies only to information, not matter and energy.)

Rapier says biofuels will never succeed until the effort at developing them is redirected into producing methanol rather than ethanol once again:

For methanol, we can produce it from biomass via a similar process to how it is produced for $1 per gallon today. There are numerous biomass gasifiers out there. Some are even portable. They do not require high fossil fuel inputs and they utilize a much larger fraction of the biomass. They aren’t limited to cellulose. They gasify everything – cellulose, hemicellulose, lignin, sugars and proteins – all organic components. And if there is also a heating application, the combined heat and fuel or power efficiency of a biomass to methanol via gasification route is going to put cellulosic ethanol to shame. In any case, the efficiency of biomass gasification to methanol is going to put cellulosic ethanol to shame, because it doesn’t have to deal with all of that water present in the ethanol process.

Altogether, Rapier argues that methanol has a much broader potential feedstock, is easier and cheaper to produce and could be manufactured in much larger quantities than corn ethanol. And this doesn’t even consider the possibility of synthesizing it from our superabundant supplies of natural gas. The problem is that “methanol doesn’t have a big lobby and 42 senators from farm states it can count on for perpetual support.”

At Fuel Freedom Foundation, we believe we should pursue all these options – ethanol, biofuels, compressed natural gas (CNG), liquefied natural gas (LNG) and electric cars. They all offer the possibility of reducing the $350 billion we shell out each year for imported oil. But we can’t help but admire Rapier’s observation that the methanol option is greatly underappreciated. The reasons are: 1) the EPA restrictions that make it illegal to use in car engines and 2) the lack of any large constituency such as the farm lobby that stands to gain from it. For that reason alone we’re very encouraged by Rapier’s writings and look forward to more in the future.

Matching ethics and policy: Free markets, subsidies and fuel

There is probably a reason that ethicists rarely sit at the public policy table with respect to transportation fuel. Let’s think about it for a few minutes in the context of a diverse group of econo-ethicists. Let’s match the ethics of presently monopolistic gasoline markets, the huge oil subsidies granted to oil companies and, yes (for environmental folks), the gift of HOV lanes and tax subsidies for those with the “right” cars, with:

  • John Rawls’ ethical guideline that we should respond to the least among us as we would want to be responded to ourselves,
  • Jeremy Bentham’s ground rule that we should seek the greatest good for the greatest number),
  • Karl Hayek’s admonition that the least government is, generally, the best government,
  • Michael Douglas’ statement in “Wall Street” that “greed is good.”

Currently, oil company policy and behavior with respect to gas stations they own, franchise or influence is very restrictive. Even when they allow alternative fuels to be sold in gas stations, companies play the role of Cinderella’s ugly stepmother. Alternative fuel pumps, often, are placed apart from the gas pumps, sometimes out of sight. If they were human, the alternative fuel pumps, legitimately, would have a discrimination case, need psychiatrists and would probably cry a lot because of loneliness. Lacking choices, consumers must pay an extra tariff for gasoline. Prices for gas reflecting little or no competition are arbitrarily high.

Congress supports the oil monopoly at the pump. It has failed to allow methanol as a transportation fuel and has not passed open fuels legislation.

Certainly, an ethical judgment of the current fuel market and those who establish its limited boundaries should be easy to make. You would get an “A” from both Rawls and Bentham as well as from Hayek if you said, “It is rough on the poor who pay upwards of 15-17% of their income for gasoline and it forces extra costs for all of us at the pump.” Finally, it illustrates Hayek’s warning that too much government restrictions limit freedom. Gosh, who ever thought I would agree with Hayek, even in a limited way? Perhaps, however, Mike Douglas wins this one. Greed has been good for the oil companies.

Douglas also wins big on tax subsidies to oil companies. Yet, despite diverse ethical principles, everyone scores well on the granting of tax subsidies to the oil industry. Both liberal and conservative groups, as well as the Congressional Research Service (CRS) agree that many of the tax subsidies are not needed to secure production and distribution. Why, then, does the industry benefit from such beneficence? History granted them favored status; politics and money give them influence at budget-making time.

I was in favor of (and probably deep down still tilt toward) HOV lanes. But, I do have some real doubts about tax subsidies, particularly subsidies not tied to income.

I am worried about the ethics of both. Most of the benefits of HOV lanes and tax subsidies to secure buyers of cars that use them go to relatively affluent income folks. Both are paid for by general taxpayers, including income-deprived tax payers.

Further, most low and moderate-income households face severe budget constraints if they try to buy new so called clean vehicles that are now allowed in the HOV lanes and secure tax benefits. No preference is granted to other alternative fuels like ethanol, and the federal government does not readily allow the relatively inexpensive conversion of existing cars to alternative fuels — methanol, ethanol. States generally do not permit the small number of converted cars in HOV lanes. Lastly, in terms of debits, HOV lanes do increase congestion, when they are not utilized to the fullest, increasing driving costs for every one of us who are not so lucky to own the “right” vehicles.

So HOV lanes and tax subsidies for favored cars do raise ethical questions. They don’t treat the least among us fairly, they are not good yet for the greatest number of us, and they reflect government behavior that reflects a bit of shooting from the hip before tough analysis concerning efficiency, and effectiveness. Let me see, Rawls, Bentham and Hayek would at least be sensitive to the involved ethical issues.

Alright, are you happy, indifferent or sad that ethicists are not at the policy table? Let me know.

The Dennis Prager Show: Breaking Our Oil Addiction With Fuel Freedom

Radio host Dennis Prager speaks to Fuel Freedom Foundation cofounder, Yossie Hollander, about how the organization is planning to end America’s addiction to oil by opening the fuel market to American-made replacement fuels that are cheaper and cleaner. Hollander discusses the alternative fuels, the current regulatory environment and dispels some common myth surrounding the price of oil.