Analysts Demonstrate Why Fossil Fuels Dominate Energy Use

Published June 17, 2015

The panel “Energy Realities” brought environmental analysts together to discuss the superiority of fossil fuels to other forms of energy on the basis of abundance, costs, safety, and reliability. 

These characteristics make fossil fuels critical for continued economic progress in developed and developing countries to attain levels of prosperity found in wealthier countries. The speakers included Manhattan Institute Senior Fellow Mark Mills; Kathleen Hartnett White, director of the Armstrong Center for Energy and the Environment at the Texas Public Policy Foundation; and Howard Hayden, editor of The Energy Advocate.

The Power of Shale

Mills’ presentation, “Shale: 2.0 and how it will end green dreams,” laid out a number of energy realities.

Among those realities discussed was the fact “[the] world is going to get bigger and wealthier, and a wealthier world consumes more energy—not less energy,” said Mills.

Mills said climate policy is essentially energy policy, and the biggest myth in climate policy is by improving efficiency, we can reduce energy use. 

Mills pointed out, “[E]fficiency is a synonym for lowering costs, and [while] lowering costs allows GDP to outgrow energy demand, it does not push energy consumption down.” 

Energy use grows as the cost of energy drops. 

A second energy reality is “the world has received most of its energy from hydrocarbons in the past and will continue to do so in the future,” Mills said.

As an example, Mills said, “Just a three percent increase in the thermodynamic efficiency at fossil fuel power plants would add 80 gigawatts (GW) to the output of existing power plants. The 
total installed capacity of all solar photo voltaic systems in the United States is just 20 GW. So if you think about where innovation should go to make a difference in the supply of energy, the arithmetic is immutable.”

Mills says the world has an oversupply of oil because the United States has entered the new era of shale oil. 

“We are effectively manufacturing oil from source rock and geophysicists tell us in terms of source rock we have thousands of billions of barrels of oil and now we have the technology to develop it,” Mills said. 

Horizontal drilling, microseismic technology, and hydraulic fracturing have enabled us to produce increasing amounts of oil despite falling rig counts. 

“The Saudis will find that by driving prices down, they accelerated the pursuit of the most efficient technologies and growth of the most efficient producers, and the U.S. capability to produce shale oil will double while the average costs to find it will fall by half,” said Mills.

A Grand View of Energy

Kathleen Hartnett White painted with a broad stroke in her presentation, “The Elemental and the Grand Sweep.”

“Energy plays the role to the economy that metabolism does to the human body, critical to its function. . . . Energy amplifies human life,” Hartnett White said. “Energy creates time or at least produces more free time and longer life spans.”

Astounding Energy Efficiency Gains

Howard Hayden’s presentation, “The Real World Pitfalls of Renewable Energy Programs,” began with a series of laughable failed predictions made by renewable energy boosters. 

For instance, in 1978 Ralph Nader confidently predicted, “Everything will be solar in 30 years.”

The Union of Concerned Scientists predicted by 2000, “wind farms would provide 0.68 quads of energy and direct solar 0.60 quads of energy.” 

Their predictions were only off by 94 percent and 87 percent, respectively.

Hayden provided a powerful indictment of the inherent weaknesses of wind turbines as an electric power source, but what I found most informative was his discussion of energy efficiency 
gains in the United States. Hayden says Americans use only 3.5 times more energy today than their ancestors did in 1800, despite the advent of cars, trains, airplanes, electric lights, electric motors, central heat and air-conditioning, refrigeration, telephones, cell phones, computers, televisions, and all the server centers providing them information. 

Our power demands are not higher because fossil fuels are a relatively dense, compact form of energy, and the nation has been making constant gains in efficiency using a variety of new 
technological wonders.