In the Maryland Daily Record

In MidAmerican Energy Holdings Co., Constellation Energy Group would not only get an owner with access to the vast cash reserves of Berkshire Hathaway Corp., but also one that can be aggressive in pushing its agenda with regulators.

This should set up a true contest of wills.   On the one side, MidAmerican, controlled by investor Warren Buffett, has a history of aggressively spending on electric infrastructure projects, which Maryland sorely needs.  Recent estimates suggest that Maryland will face power blackouts as early as 2011 if more generation or transmission is not developed to meet the increasing demand.

Should MidAmerican use their Iowa model, Maryland could see electricity generated by a mix of coal, natural gas, nuclear and renewable sources.  The Daily Record reports that in Iowa, “55 percent of [MidAmerican's] facilities are fired by coal, 22 percent by natural gas and 10 percent by nuclear power. The remaining 13 percent comes from other sources.”

It would be reasonable to assume that such a model could work in Maryland, which has ready access to coal reserves in western Maryland and West Virginia.

However, this produces a legislative problem for Maryland.  Passage of the Health Air Act in April 2006 requires Maryland coal-fired power plants to install technology to reduce emissions emissions of sulfur dioxides, nitrogen oxides and mercury. It also calls for Maryland to join a regional pact to reduce carbon dioxide emissions 10 percent by 2019.

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Introducing her new “energy bill,” House Speaker Nancy Pelosi declared

“If [Republicans] want to drill offshore, we’ll say, ‘OK, You want to drill in the outer continental shelf? Let’s have a discussion and a change of the relationship between our oil, which is owned by the American people, the desire of Big Oil for us to subsidize their drilling, and…the American people not getting the benefit of the profits.’”

Once again, the Democrats slam Big Oil to the American public.  This time Pelosi indicates that we need “a change of relationship” between the American people and the Big Oil companies, stating outright that the American people “are not getting the benefit of [oil] profits.”

How about a change in relationship between our elected officials and the American people?

How about the benefit of having our interests represented in our elected government?

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Let’s talk about what isn’t cheap…petroleum.

Last night Alaskan governor and vice-presidential candidate Sarah Palin hit the nail on the head.

With Russia wanting to control a vital pipeline in the Caucasus, and to divide and intimidate our European allies by using energy as a weapon, we cannot leave ourselves at the mercy of foreign suppliers.

To confront the threat that Iran might seek to cut off nearly a fifth of world energy supplies … or that terrorists might strike again at the Abqaiq facility in Saudi Arabia … or that Venezuela might shut off its oil deliveries … we Americans need to produce more of our own oil and gas.

We need to face the fact that the true cost of dependence on foreign petroleum sources is just that:  DEPENDENCE.

America’s greatest vulnerability is her dependence on hostile nations for energy supplies that are vital to our economic stability.  Barak Obama bemoans the fact that at the RNC

you didn’t hear a single word about the economy.  Not once did people mention the hardships that people are going through.

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Lessons from Georgia

Americans love a bargain.  Just look at the success of Wal-Mart for proof that America loves cheap goods.

And it is our love for cheap goods that keeps us dependent on foreign energy sources, particular petroleum supplied by our “allies” in Saudi Arabia.  The early summer spike in fuel costs has been forgotten in the waning days of summer as we “feel” we are getting a bargain, pumping our gasoline at a mere $3.69 per gallon this fall.

With the Wall Street Journal reporting oil futures contracts down to $107.77 per barrel of crude, gasoline prices may continue to decline as world economic growth slows and demand for petroleum products continues to decline.

But Vladimir Putin’s swagger into Georgia has an important lesson for Americans relaxing about the economic and strategic importance of energy independence:  Take a hard look at what is happening in the European Union.

Bloomberg reported yesterday that European leaders, facing the fast approaching winter, find themselves strategically hog-tied in attempting to sanction Putin for military actions in Georgia, acknowledging their dependence on Russian oil and gas at a time when the European economy is teetering on the brink of a recession.

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The Democrats would like the American public to believe that the economic problem plaguing American citizens is an American problem, created by American politicians with failed American policies.  But can you guess who said this?

We have a credit crunch the like of which we haven’t seen in generations. We have it at the same time as oil and food prices are going up. But I also am clear that the fundamentals of our economy are strong.  We will do whatever is necessary to help people and to help the economy through what are undoubtedly unique circumstances.

This could be Barak Obama.  But it’s not.

Global issues impact the world economy.  Just ask Alastair Darling, UK Chancellor of the Exchequer.   In an interview with the Guardian newspaper on Saturday, Darling said the economic difficulties the U.K. is facing “are arguably the worst they’ve been in 60 years … And I think it’s going to be more profound and long-lasting than people thought.”

With food and oil prices rising rapidly in the UK, the government is scrambling for politically expedient solutions to stave off public criticism.

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For voters concerned about the direction of things in Washington, John McCain’s choice for vice-president should provide some hope that real change can be in the making:  Sarah Palin’s “experience in shaking up the status quo is exactly what is needed in Washington today,” McCain’s announcement said.

Fiscally and socially conservative, Palin ousted the incumbent governor in the Republican primary in 2006, and defeated a former governor in the Alaska general election.  She immediately took to the business of government reform in her home state of Alaska by selling the state jet and taking members of her own party to task for ethical violations.

As energy adviser to McCain earlier this year, Palin evoked the ire of the environmentalist by suggesting that drilling in the Alaskan wilderness could ease the current oil crunch with minimal impact to the wilderness environment.

“…up here in Alaska, most every Alaskan believes that ANWR should be drilled, and no one cares more about Alaska’s environment–our lands, our wildlife, our fresh air, our clean water–than Alaskans themselves. And we know that this can be allowed safely, cleanly, ethically–this type of exploration and development of an American supply of energy.”

With the “drill now” initiative a high-profile issue in the current presidential race, Sarah Palin’s voice and experience should help clarify the real picture associated with drilling in ANWR.

The Gazette reports that Martin O’Malley, speaking at the annual Maryland Association of Counties summer conference, publicly touted his new energy plan:

We believe that we can make our state the national leader in renewable energy and we plan to move forward toward making our state one of the very first in the nation to use its market power to jumpstart large-scale commercial renewable energy projects (”O’Malley touts Montgomery program in energy speech” August 18, 2008).

About what “market power” is he speaking?   The rising demand for electricity in Maryland?

All indicators suggest that the demand for electricity in Maryland is increasing so much that the alarmists are crying about brownouts, soon to occur in Maryland as early as 2011.

Yet, once again, the O’Malley Administration refuses to address the crux of the issue:  Maryland’s aging power grid.  Once again, the Democrats refuse to accept responsibility for creating a hostile business environment that discourages business investment in creating new energy sources or the infrastructure necessary to support them.  In short, as with the port it’s the infrastructure, stupid!

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American energy independence in an emerging global economy

The Wall Street Journal reports that the financial market opened this morning with crude prices continuing to drop (“Commodities continue to plunge” August 15, 2008).  Spurred by worry that weakening growth will upset demand, oil futures dropped nearly $1 to around $114 a barrel in New York this morning, down roughly 21% from its July 3 peak of $145.29 a barrel.

With the price of oil futures tumbling, many Americans may be breathing a sigh of relief pocketing those few dollars “saved” at the pump while gasoline prices decline.

But what has America really learned about the oil commodities market?  And will the declining prices slowly silence the cries for energy independence?

Let’s face it:  Americans embrace short-term solutions.  With the pain at the pump abating, the declining crude prices, though largely resulting from a sluggish world economy, may lull Americans into believing that the latest round of energy cost peaks was merely an anomaly in the market, a mere spike on a graph published in a reputable financial journal.

But with China and India emerging as strongly-growing markets, the demands for energy will only increase from that sector of the global economy.  And despite America’s best conservation efforts, voluntary or otherwise, without changes in America’s energy policy, the future can only bring a surge in demand for energy sources that will, once again, hit Americans in their wallets.

The only solution is to decrease American dependence on foreign oil suppliers.  America must develop American resources to address American supply issues.

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