Solid policy objectives can be achieved
Q: What does it mean for a nation to be energy independent? Is it realistic and if so how should that be achieved?
"Energy independence" is something of a sloppy term, but it seeks to capture several interrelated policy objectives, and as a result is an important goal to pursue.
First, it is important to insulate the United States from external energy shocks. Sixty-eight percent of U.S. imported oil comes from countries rated as "high risk" or "very high risk" of political instability by the Economist magazine. The reality is that are significant economic consequences of being heavily reliant on a source of energy that is prone to disruptions due to instability.
Second, energy purchases contribute significantly to balance of payments deficits. Worse, much of the money we sent abroad to buy energy goes to countries that then use those funds to undermine American interests. We send billions to Hugo Chavez annual. We send billions to Saudi Arabia. We send billions to Russia. In each case, we're funding, in part, countries pursuing global policy objectives at odds with American interests.
Third, international energy flows are vulnerable to terrorism and piracy. We spend billions annually on security for these energy flows. As a result, energy dependence also implies very costly global security responsibilities. By some estimates, we spend $100 billion annually to maintain capabilities to ensure access to Middle Eastern oil alone.
Fourth, we have tremendous potential sources of energy at home. Focusing on off-shore oil exploration is unfortunate. Instead, we should focus on the massive opportunities in solar, wind, geothermal, and even nuclear energy at home. Locally produced energy is less prone to disruptions, requires less investment in international security measures, and promotes economic growth at home through high-paying jobs in the domestic energy sector.
"Energy independence" may have a vaguely nationalist feel to it, but behind the rhetoric there are some very solid policy objectives that could be achieved by increasing energy production at home and reducing our reliance on some of the riskier foreign sources that currently make up a large part of our energy portfolio.
In terms of how much energy independence we can achieve... it depends how much we're willing to invest. But if we were to move to a hydrogen or battery electric transportation sector, we could become wholly energy independent. There are some upfront costs, certainly, but no fundamental technological hurdle even today to a revolutionary shift in our reliance on foreign produced energy sources.