Right Direction

Montana gov Schweitzer has a plan to build a Fischer-Tropsch conversion plant, which basically takes coal, turns it into natural gas, and then into gasoline. Which is good for Montana, seeing as it has some of the largest coal reserves in the country. Apparently this process becomes cost effective after oil hits about $30 a barrel (although I seem to remember a little thing called the laws of thermodynamics that state that every time you convert energy from one form to another you lose energy in the process).

According to this article

The governor estimated the cost of producing a barrel of oil through the Fischer-Tropsch method at $32, and said that with its 120 billion tons of coal -- a little less than a third of the U.S. total -- Montana could supply the entire United States with its aviation, gas and diesel fuel for 40 years without creating environmental damage.

Sounds great if true. For one thing, it's great to see one of the rising stars of the Democratic Party on the cutting edge of energy independence. Make the Republicans play catch-up. It's also an idea that could bring lots of jobs to his state.

Of course, there are downsides. $1.5 billion to build a plant that can produce about 22,000 barrels of oil a day. A drop in the bucket compared to the roughly 20 million barrels we go through every day. So start up costs will be enormous. Who's going to pay for that? Most likely taxpayers, through heavy subsidies and tax credits to oil companies.

And I think that, Americans being as short sited as we are (remember around 1999 it seems everyone collectively said "Gas is at $1.12 a gallon! Now I can afford to buy an SUV that gets 5 miles to the gallon because there's obviously more gas than we can ever use"). So I think the biggest danger here is that we'll think of this as a practically permanent solution. Even if we could access the proposed 40 years worth of fuel in Montana, that's going to free up demand from middle eastern and other sources of oil, which will lower prices, which will cause the excess oil to be soaked up by the developing 3rd world (especially China and India) which would land us in an even bigger mess at the end of our sabbatical, because now you've got the 2 billion or so people in east Asia who will have become as addicted to black tar as we've become, and practically exhausted reserves. And as much as I'd like to think that we'd use that time constructively to perfect renewable fuels, our track record on foresight is not exactly stellar.