One of the concerns raised about the ongoing crisis in Egypt is the effect that this may have on oil prices. No, Egypt isn’t a top oil-producing nation – but the Suez Canal is a major thoroughfare for oil tankers (and other shipments), so disruptions may have an impact. For now, things look ok, but this is as good a time as any for Americans to reflect on our nation’s energy options.
Suggestion #19: All energy sources must be on the table.
I have every confidence that America will be able to invent new, cleaner ways to fuel our economy in the future. Unfortunately, getting to a clean energy economy is going to take some time. Trying to get there through mandating renewable energy standards or imposing a nationwide cap-and-trade program is only going to raise the price of energy in the short-term – effectively reducing the amount of money that our nation’s innovators have in their pockets, and the amount they have to spend on research and development.
So what’s the best way to help our nation’s innovators?
For starters, Congress must keep the nascent economic recovery going by keeping energy prices as low as possible. That can be done by leaving all energy sources on the table – oil, gas, coal, renewables, and nuclear – and not hindering the use or development of these products. If something is commercially viable, investment money will flow to those projects – and if it’s a dud, the market will figure that out quickly enough.
In addition, Congress can help innovators by letting them compete fairly in a free market – and get out of the business of choosing winners or losers. No industry should receive subsidies that would unfairly advantage them (see Day 3, “End Ethanol Subsidies”), or face undue production barriers (like the nuclear industry).
Let’s keep prices low and let the market reward the next great technological innovation in the energy field – not try to control the direction through a political process.