Food vs. fuel thoughts

I was pretty interested in NCBR’s ‘Where do you sit on the food vs. fuel debate?’ poll question results. I checked the tally at least three times a day. For about the first four days after the poll went active ‘corn for animal consumption’ was beating out ‘corn for human consumption.’ I guess that just meant people wanted their chicken and steak more than their corn on the cob – but still half as much as they wanted to drive around on Ethanol at $2.30 per gallon.

An emerging new trend in the electric utility industry is the mandate on electricity producers to generate a given percentage of power from renewable resources – wind, solar, hydro, etc. Electricity providers in Colorado with 40,000 or more customers will have to generate 20 percent of their energy from renewable resources by 2015 after Gov. Bill Ritter signed House Bill 1281 thus doubling Amendment 37’s 10 percent that voters passed in 2004. I think that’s a great step, but I’m waiting for the day when oil companies find themselves with similar mandates.

Yes, it will go a long way in getting the United States off its dependency for foreign oil. Yes, another part of it has to do with fairness – if electricity producers have to then, why not petroleum companies? But my biggest reason for renewable energy mandates for oil companies is to have them use their virtually unlimited Research and Development resources for renewable resource purposes.

Ethanol, biodiesel, algae – I figure these are the best options for oil companies to turn to should they ever be faced with mandates similar to Amendment 37. Just imagine what could happen to the ethanol industry if it had big oil R&D behind it. I envision corn kernels the size of tennis balls in six months.

According to CNNMoney.com, Exxon Mobil posted a profit of $36.1 billion in 2006. Chevron and Conoco Phillips, the second and third top earners for the year, both posted profits of just under $15 billion each. Below is a list of R&D expenses for oil companies according to the Department of Energy in five-year increments.

I think it sure looks empty about half way down the table.

on Facebook on LinkedIn