Declaring Energy Independence

The 4th of July always begs the question: What does ‘independence’ actually mean? After more than a dozen years thinking about transportation and fuels, energy always bubbles to top of mind. 

Declarations of “energy independence” usually provide more heat than light (pun very much intended).  The often heated discussion on the topic usually obscures the essential distinction between energy resources and their end use. From a policy perspective, that distinction is critical.

Power and electricity generation come from an array of fossil and renewable sources like natural gas, nuclear, hydro, solar, wind, coal and geothermal. On the other end of the spectrum, 90% of transportation depends on petroleum. That fundamental difference defines a very different policy landscape. Until our cars, trucks, locomotives, ships and airplanes transition to electricity, transportation needs to be a separate conversation.

The fact is—no matter how many pundits claim otherwise—we are only “energy independent” by ignoring that our geopolitical and strategic options are limited by the overwhelming dominance of petroleum in the transportation sector.  So, no, we are demonstrably NOT independent. Google also tells its own story. For half a century, every single U.S. president has been forced to beg, scrape or kowtow to foreign dictators to open or close their spigots, and too often been bound to put our troops in harms way to protect the flow of oil. Because for the vast majority of our transportation system, there is simply no alternative.

Repeating what has become my professional mantra: it does not have to be this way.

We can and should permanently diversify the energy sources used in transportation. Well-established process technologies are ready. And thanks to a host of emerging renewable and waste pathways, resources abound. Opening the door to innovation will accelerate the possibilities.

The best policy fix isn’t a mystery. Clean fuel standards have reduced greenhouse gas emissions more quickly and cost-effectively than anyone expected. Equally important, they have significantly diversified the fuels used on the road. California, Oregon, and Washington have successful policies in place. New Mexico is soon to follow. 

California has the largest and longest-established program. The fuels used in the state are increasingly varied (see Figure 2 on this data dashboard). Trucking provides an illustrative sample of how wider adoption of clean fuel standards can transform our transportation reality.

Renewable diesel and biodiesel blends can be used in existing vehicles with NO modifications. The result is genuine market competition. As of the end of 2023, fully 60% of the diesel consumed in California was made from renewable and waste products, while conventional (aka petroleum) diesel made up the remaining 40%. But here’s the real kicker: Renewable diesel has even regularly been cheaper at the pump. Market alternatives provide a buffer to consumers when oil prices rise.

Nationally, 76% of commercial trucks and transit and school buses use diesel, while an additional 22% run on gasoline and 1.9% use either natural gas or propane. That’s 99.9% of the market that’s ripe for transitioning to cleaner—and sometimes cheaper—fuels that can be used in existing engines.

The rest of us can benefit, too. About 20 million cars and trucks on the road have flex-fuel engines, which can interchangeably use gasoline or any blend of ethanol up to 85% (branded as E85). E85 in California has consistently been $1.00/gallon or more cheaper than gasoline, rising to as much as $2.50/gallon less when oil prices rose after Russia invaded Ukraine. More flex-fuel vehicles, with added plug-in electric hybrid capability, can provide even more fueling options for market competition to flourish.

As more drivers and commercial fleets shift to electric vehicles, transportation simultaneously becomes less dependent on liquid fuels, and even more diverse from an energy perspective. There are also great stories for the exciting things happening in aviation and shipping. But those are blogs for another day. Across the board, clean fuel standards benefit the vehicles of today AND help transition us to the vehicles and vessels of tomorrow.

Along with that comes freedom. Clean fuel standards can free our national and personal economic well-being from dependence on the whims of the oil market. There’s no guarantee what will be cheaper at any given time. That’s not how a market works. Drivers are simply free to decide based on price or priorities. Only then can we—finally, actually—declare our energy independence.