NEPI’s Tony Knowles on U.S. Energy Policy

A new, green-tinted energy initiative hatched in an unlikely locale — Tulsa, once the self-styled “Oil Capital of the World” — seeks to create the basis for a comprehensive national energy policy.

That’s a tall order. From President Nixon’s 55-mph speed limit through President Carter’s “moral equivalent of war” to today’s rancorous, ideologically tinged debate, the U.S. has never succeeded at building a lasting national energy policy.

The National Energy Policy Institute’s president, Tony Knowles, recently discussed NEPI’s mission with me, citing an urgent need for the U.S. to develop a rational, cost-based foundation for making sound energy choices.

“We have no energy policy nationally; we have a series of pieces of legislation that have, for whatever reasons, ended us up more dependent on foreign oil than ever before,” he said. “And the only significant change seemed to be to turn corn into fuel, and there we ended up raising the price of food.”

NEPI is undertaking a study of U.S. energy policy options that includes the “hidden costs” of oil imports and greenhouse gas emissions, said Knowles. The idea is to compare the total costs of each energy choice so as to pick the most cost-effective ones in a way that’s not only rational but politically feasible.

The study would be an “apples-to-apples comparison of the best ways to  reduce the nation’s dependence on imported oil and reduce our greenhouse gas emissions,” he said.

For example, NEPI’s study would determine the cost and market impact of using a federal tax credit as an incentive to convert a large vehicle fleet to natural gas.

“Once you’ve determined the total cost of the incentive, you divide that by the number of barrels saved, and you arrive at the per-barrel-reduced cost,” Knowles noted. “Then you analyze how much greenhouse gas emissions are reduced—natural gas emits half the CO2 of oil and coal—and you can calculate the cost per ton of CO2 reduced. This way, you have an idea of the comparative costs of the various energy alternatives for policymakers to get at the least-cost alternative.”

Once the study is completed in the fall of 2009, NEPI will launch a media blitz, along with white papers, conferences of energy experts, and sit-downs with key congressional leaders.

Democratic leaders in Congress hope to push out comprehensive energy legislation this year. Isn’t Knowles concerned about NEPI’s report coming out after such legislation has been passed?

“There’s no fear of that,” he said, laughing. “It won’t be resolved by then. It hasn’t been resolved to date because, frankly, they don’t have the consistent, objective, independent information to base it on, but we’re hoping to add to it.”