Oil at $100/bbl focuses the mind wonderfully

Congress agreed to raise fuel-economy standards by 40 percent for cars and light trucks by 2020 in a move described by lawmakers as a historic step toward cutting U.S. oil consumption and curbing global warming.

The new rules would require the U.S. to set mileage standards for each type of vehicle to meet a national average of 35 miles per gallon. In exchange for a higher benchmark than automakers had wanted, the industry would continue to get credit for making vehicles that run on alternate fuels such as gasoline blended with ethanol.

[...]

The current standard is 27.5 mpg for passenger cars and 22.2 for light trucks.

[...]

Congress established the so-called CAFE standards in 1975 in response to the 1973-74 Arab oil embargo that caused shortages at U.S. gasoline stations. New car-fleet economy, set at 12.9 mpg in 1974 according to the Congressional Research Service, was ordered to reach 18 mpg by 1978. Light trucks were required to achieve 17.2 mpg by 1979.

NHTSA set truck standards for subsequent years and imposed fines for noncompliance. Attempts by legislators to raise mileage goals from the early 1990s through 2006 were defeated.

Bloomberg: Congress Agrees To Increase Fuel Standard to 35 MPG

The 35 MPG standard doesn't take effect until 2020.

Which makes it, what, only 30 years too late?

Welcome to Energyville

How do we meet growing global energy demand? What new kinds of fuels and power sources should be developed? These are the sorts of questions facing us all.

To help encourage greater understanding and dialogue, Chevron and The Economist Group have created Energyville, an online, interactive game that puts you in charge of meeting the energy demands of your city. It's a chance to put your theories into practice. Choose from a portfolio of available energy sources to power your city today, and through 2030. Every decision you make will affect the environment, the economy, and even your city’s security. So, give each move some real thought.

In appreciation of your participation, we’re sending all participants* a gift voucher for a six-month subscription to Economist.com. This will give you access to The Economist’s full content, plus our archive of over 30,000 articles. You can keep the voucher for yourself, or give it as a gift. Just follow the link after you finish the game and claim yours today.

Energyville

The economics of renewable energy

Cheerleaders for renewable energy are fond of pointing out that patches of desert receive enough energy each year from sunlight to power the entire world. But few deign to explain how the construction of the millions of solar cells required to convert that energy into electricity would be financed. Utility bosses and policymakers tend to dismiss wind and solar power as noble but expensive distractions, sustainable only through lavish subsidies. But new studies suggest that renewables might not be as dear as sceptics suspect.

The Economist: Cheap Alternatives (July 5, 2007)

WSJ: As Threats to Oil Supply Grow, A General Says U.S. Isn't Ready

Three years into the sharpest spike in oil prices in a generation, policy makers and military leaders across the globe are grappling with the implications of fundamental change in energy geopolitics. One such leader is the new U.S. defense secretary, Robert Gates, who took part last year in a war game simulating disruptions to the oil trade. It concluded the U.S. had few short-term fixes if supplies were jolted.

Supply lines are longer and oil fields more numerous than a generation ago. New threats have emerged, from rebels in West Africa to terrorists targeting Saudi Arabia. With supply and demand tightly balanced, even small disruptions can cause big price swings, endangering economic growth. Nationalistic fossil-fuel powers such as Russia have shown willingness to brandish energy as a weapon. The war in Iraq has hammered the oil industry in the world's third-largest holder of conventional oil reserves.

In this new era, one of the central security assumptions of the 20th century -- that a powerful U.S. military can protect America's energy interests across the globe -- falls short.

As Threats to Oil Supply Grow, A General Says U.S. Isn't Ready (Wall Street Journal [subscription required], December 19, 2006)