Until recently, T. Boone Pickens was better known for greenmail than green energy. Pickens – oilman turned corporate raider – leveraged Mesa Petroleum and Michael Milliken’s junk bonds to make billions during the 1980’s hostile takeover craze.
But with his recent $10 billion tilt toward Texas wind farms and solar, who’s to say whether Pickens is an energy visionary or just the consummate frontrunning egomaniac? One thing is certain: Pickens has always had a plan, and he’s been spotting trends and making fortunes in energy for over half a century.
The “Pickens Plan” is basically a $58 million marketing campaign to wean the US off foreign oil within 10 years by using natural gas for vehicles, and wind and solar for utilities – and for Pickens to receive as much credit for it as possible.
During his 30-minute pitch at the Commonwealth Club in San Francisco on March 25, Pickens hardly mentioned pollution or global warming, instead pushing national security and economics to close the deal. “I want to get off foreign oil,” Pickens says, “the biggest transfer of wealth in human history.”
The US spends $450 billion per year and climbing on foreign oil – which he forecasts selling for $70 per barrel in the near-term and $200-300 per barrel within 5 years – if we continue with “no plan” when the economy recovers. This, says Pickens, would bankrupt the US, already beholden to unfriendly state-owned oil producers.
Pickens is “wait and see” on cap and trade – hardly surprising for the long-time conservative who supported George W. Bush and underwrote the Swiftboating of John Kerry. But Pickens wholeheartedly endorses Obama’s stimulus, energy, and budget plans – especially investment and tax credits and focusing on new transmission lines first – claiming it’s “my plan.” His only caveat, he told Obama during the campaign, was to “think big.” For example, he asked, why pledge to have 10 million plug-in cars on the market within 10 years, when there are 250 million vehicles in the US?
www.pickensplan.com
www.commonwealthclub.org
Jim Rossi is a writer and consultant based in San Francisco: jimrossi.sf@gmail.com.
5 comments
If it’s his plan, and it gets adopted, then he deserves the credit for any success — and blame for any failure. I’m not keen on the natural gas aspect, but wind and solar for utilities would be a step in the right direction.
Pickens likes plug-ins, but like he says, they won’t push an 18-wheeler. He presents natural gas as much cleaner than gas or diesel.
Interesting comment on 18 wheelers. If you go to the Peterbuilt website, they have hybrids for sale up to the full size 18 wheeler. They have pictures of their hybrid 18 wheeler, but as of a month ago, you couldn’t order one. Whereas a hybrid sedan on up to a shuttle bus gets about 40% fuel savings, hybrid 18 wheelers will only net about a 25% gain. Another website pointed out that for large trucks, every 4% in savings reduces US oil consumption by 1%.
My largest suspicion with Picken’s plan is that by principally pushing wind, he is guaranteeing we would have to build peaking/fast response NG generation plants. Given that he is now a “gas man”, instead of an “oil man”, I have to admit I am more then a bit suspicious of either his motives or (most probable) his reasoning. His notion of think big is right on the money for me though.
Great point about Peterbilt, but let me emphasize that Pickens was talking about electric plug-ins, not hybrids.
The Pickens Plan aims to eliminate, not reduce, our dependence on foreign oil. Since we get something like 70% of our oil from foreign sources, Pickens supports “anything” that uses less oil – presumably including hybrids – but doesn’t think they are the long-term solution.
btw, I suspect his motives much more than his reasoning! His business acumen has been legendary for decades.
PHEV’s do not make sense yet for large trucks. The battery packs would cost cargo capacity, and what range would you set it for? Some of these guys are driving just under 1000 miles a day. I could see it for Fed Ex type vans and shuttle buses. While I’m sure we could find examples of where it would make sense, you would end up with such small production runs, it would be economically punishing for little gain. Switching all engines to NG might be the way to go, but not until we quit using for electricity.
As for the rest of it, 100% deployment of PHEV’s on all passenger cars and light trucks would reduce US oil consumption. Throw in hybrid 18 wheelers, and you get a 56% reduction. That leaves a much smaller and sustainable fleet for NG, or bio diesel such as thermal depolymerization.
As for his business accumen and motivation, I do not know him or his thinking to besmirch his ethics. At the very least, when one is a hammer, the world is full of nails. At a minimum, switching to NG switches us from problems with peak oil in the future to problems with peak natural gas.
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