The United States currently produces 8 percent of the world’s liquid fuel but uses 25 percent, making up the difference by importing 5 billion barrels of oil annually. With prices currently near $100 per barrel, this dependency will cost us $500 billion this year, an amount equal to the nation’s entire trade deficit. Furthermore, at a time when Congress is seeking to keep taxes light in order to boost job creation, our dependency will impose a tax on our economy equal to 20 percent of what Americans pay the IRS. Except, of course, that these revenues will go to the treasuries of foreign governments instead of our own.
During the 1940s, the United States produced 60 percent of the world’s liquid fuel. This advantage proved to be a major factor in securing the Allied victory in World War II. Had we been as weak in energy security then as we are today, we might well have lost the war, as enemy submarines could have collapsed our economy, and with it our war effort, simply by cutting off our oil supply.
If we are to break free of the crushing economic burden and national-security threat that oil dependency imposes, we need to triple our liquid-fuel production. There is no realistic way that this can be done through expanding domestic drilling for oil, multiplying the yield of corn ethanol (which now accounts for 20 percent of domestic liquid-fuel production), or a combination of the two. Rather, we need a new source of liquid fuel, one that can be produced easily and economically, from resources available to us, and on the vast scale required to address the deficiency.
Fortunately, such a fuel is available. It is methanol, also known as wood alcohol. In contrast to algae oils and cellulosic ethanol, methanol is not a futuristic pipe dream touted by researchers seeking funding. Rather, it is one of the world’s top five chemical commodities, with an operating global annual production capacity of 27 billion gallons, and a current spot price, without any subsidies, of $1.28 per gallon. While methanol contains only about half the energy per gallon of gasoline, its excellent octane rating of 105 allows it to be burned more efficiently, making $1.28-per-gallon methanol equivalent to $2-per-gallon gasoline. All in all, a very competitive price.
The resources available to support expanded methanol production are vast. In contrast to gasoline — which can be made economically only from petroleum — or ethanol — whose mass production requires the use of sugars or starches — methanol can readily be made from any carbon-containing material. To list a few of methanol’s potential sources: oil, natural gas, coal, urban garbage, or any kind of biomass without exception.
The United States possesses around 4 billion metric tons (29.5 billion barrels) of proven oil reserves. This would barely be enough to support a fully fuel-independent America for four years. In contrast, our proven coal reserves exceed 270 billion tons, and our natural-gas reserves may be nearly as great. North America currently produces about 40 billion metric tons per year of biomass, of which 2 billion tons are harvested as farm and forestry products and 1 billion tons discarded as agricultural and forestry waste. We also discard approximately a quarter-billion tons per year of carbonaceous urban trash. Thus, taken together, our resources for methanol production not only are up to fully replacing our current oil imports, but are up to supporting the growing demands of an expanding economy for decades or centuries to come.
Methanol burns cleaner than gasoline, causing much less particulate pollution. It is also safer — it is much less likely to catch fire in the event of a crash, and its fumes contain none of gasoline’s rich mixture of carcinogens. While, unlike ethanol, methanol is not edible, it is not especially toxic. In fact, windshield-wiper fluid is one-third methanol, and, because it is readily biodegradable, it has been handled by the public and released onto roads worldwide in vast quantities for decades without any impact on public health or the environment.
If we could convert our auto fleet to run on methanol, the $500 billion per year we are now paying foreign potentates for oil could go instead to American businesses and workers to produce our fuel right here at home. On average, it takes $100,000 of GDP to create one job. At that rate, the $500 billion spent here instead of abroad would create 5 million American jobs directly, and millions more indirectly from the construction, retail, and service industries that would be supported by the methanol workers’ paychecks. This would help address our critical national and state deficits as well, as millions of people would go from the unemployment rolls to the tax rolls.
But can we readily open our vehicle-fuel market to methanol? The simple answer is yes, and quickly. The large majority of cars sold in the U.S. today (and for at least the last five years), including all GM and Ford vehicles, have been equipped with computers and chromated fuel lines that make them potentially capable of flex-fuel operation. If provided with the right software, and with methanol-impervious Buna-N rubber seals (costing less than 50 cents per vehicle) for their fuel system, every new car sold in the U.S. could be fully flex-fuel, capable of running equally well on methanol, ethanol, or gasoline.
There is currently a bill before Congress — the Open Fuel Standard bill (HR-1687), co-sponsored by a bipartisan group including Reps. John Shimkus (R., Ill.) and Eliot Engel (D., N.Y.) — that would require flex-fuel capability of the majority of new cars sold in America. If the bill passes, a market for methanol would be created that would very quickly call into being expanded production and distribution facilities, both in the U.S. and elsewhere. This would force gasoline into competition with methanol at the pump worldwide, thereby putting in place a permanent global competitive constraint on the price of oil. Thus owners of older cars, which are incapable of methanol operation, would also benefit, since their gasoline would be cheaper. And once methanol pumps become widely available, many drivers would see the benefit of spending a few hundred dollars to have their seals replaced and cars reprogrammed to obtain fuel choice. The switch to a predominantly methanol-fueled vehicle fleet could thus take place very rapidly.
The Open Fuel Standard bill would unchain the Invisible Hand, creating a true free market in vehicle fuels. Those reluctant to embrace it need to answer the following question: In whose interest is it that Americans should continue to be denied fuel choice?
We can break our fatal dependence on foreign oil, but Congress needs to act.
— Robert Zubrin is the president of Pioneer Astronautics, a fellow with the Center for Security Policy, and the author of Energy Victory: Winning the War on Terror by Breaking Free of Oil.