T. Boone Pickens, the Texas investor and oil billionaire who has become a staunch advocate for green energy, is at it again with a wild new plan to make the U.S. more energy independent. The iconoclastic Pickens is now advocating a wholesale shift in the U.S. big-rig trucking fleet from imported diesel fuel to domestically produced natural gas.
By his math, the U.S. could cut its oil imports in half by creating a trucking fleet with 6.5 million 18-wheelers running on natural gas, Pickens said in an interview on NewsMax TV. Pickens believes this could be done within seven years.
Of course, there is a catch -- the price tag. Pickens thinks the government will need to offer a $65,000 tax credit to truckers to entice them to purchase new natural gas-powered rigs and eschew the traditional diesel ones. The subsidy will also be useful, Boone says, as a carrot to convince infrastructure builders to create a network of natural gas distribution and filling stations that would be needed to make his plan work.
Add that up and it comes to a budget well into the tens of billions of dollars. Then again, the bailout of troubled insurance giant AIG dwarfs Pickens' plan, which boasts other benefits aside from energy independence.
Natural gas engines have significantly lower emissions than diesel engines, although newer clean diesel engines are much more eco-friendly. Secondly, creating a natural gas pumping and filling station infrastructure for big trucks would make it much easier to replicate such a system for passenger cars and light trucks, which in turn could lead to even further reductions in dependence on foreign oil.
Pickens logic makes a lot of sense. America does have abundant reserves of natural gas. Recent major natural gas finds in several different locations around the country have dramatically increased the possible total accessible supply of this fuel source. After a long period of decline and stagnation, natural gas production in the U.S. has risen by 8 percent in 2009.
A significant chunk of that increase has come courtesy of the Barnett Shale, a geological formation underlying 5,000 square miles in Texas in the vicinity of Dallas and Forth Worth. This formation is believed to hold the largest producible reserves of any onshore natural gas field in the U.S., holding up to 30 trillion cubic feet of natural gas.
New drilling technologies, such as horizontal drilling and hydraulic fracturing, have only recently made it economically viable to access the natural gas in this field. Several other shale fields around the U.S hold equal or greater production process. The confluence of new technologies and promising new discoveries has lead many energy experts to conclude that even as Peak Oil looms, America is on the cusp of a new and nearly unimaginable abundance of natural gas that could reshape energy policy and global energy politics for decades to come.
Natural gas has kept a low profile in the vehicle space but it's not a no-show. The engine technology for natural gas vehicles is actually old hat. General Motors has over a dozen models of vehicles that run on compressed natural gas. Honda and other major carmakers already build natural gas-powered models, primarily for corporate and government vehicle fleets.
Pickens must realize, as well, that any move to shift the U.S. away from standard gasoline and diesel-powered vehicles would likely incur wrath of the ethanol lobby, a powerful pack of farmland Congressmen that also happens to include President Barack Obama himself.
Pickens' past forays into cleantech have had mixed results. His big push for a massive Texas wind farm on his own land has foundered, in part due to the need to construct a huge power transmission corridor from rural, windy West Texas to the more populous eastern part of the Lone Star State. Building new transmission capacity has been a huge bugaboo for green energy developers due to the complicated negotiations required involving city, county, and state governments, as well as local landholders and environmental groups.
For this specific reason, IdeaLab CEO Bill Gross avoided building new transmission lines for eSolar, a thermal energy company he heads. eSolar relies on concentrated solar power collection to harvest heat that turns generators and builds its power plants next to existing transmission towers. Naturally, Boone will profit from a natural gas bonanza and new government subsidies to truckers. Pickens is heavily invested in natural gas exploration and production. Call the man a tree hugger but he's still from Texas, folks.