Energy security is now being given serious attention. Development of solar, wind and other renewable energy technologies appears to be coming closer to reality as President Obama proposes spending billions of dollars to reduce U.S. dependence on foreign oil and to stop sending dollars to regimes that fund terrorism.
But while all this talk is exciting, it is disconnected from economic reality — many alternative energy technologies still are neither industrially scalable nor commercially sustainable — and also from political and military actuality.
A case in point is how Russia and China view energy security. The U.S. debate explicitly incorporates environmental objectives and implicitly endorses isolationist tendencies, while the Russian and Chinese versions explicitly promote expansionist tendencies while discounting or even ignoring environmental objectives.
How does Putin’s Russia understand the term “energy security?”
Not wind mills, solar farms or anything that is environmentally friendly. Putin probably doesn’t worry much about global warming. He’s obviously quite happy Arctic ice is melting, since that allows Russia to expand north and claim new riches on the floor of its continental shelf. Putin also probably finds it odd to mention “renewables” and “security” in the same breath. Energy security for Russia is not a “dual use” product. For Russia, it means making the country safe from foreign threats. This is done by leveraging its immense natural gas and oil reserves not just to boost its GDP, but also to reinvigorate its political influence while rebuilding an intimidating global war machine.
For Russia, energy security means “weaponizing” energy. It is not a philosophy that aims at some future self-sufficient “clean energy” paradise. It is a doctrine for today, which takes the world as it is, vulnerable and addicted to “dirty energy” such as natural gas, oil and coal, and exploits that dependence to make Russia stronger. With this cynical way of looking at the world, much akin to the way Colombian drug lords regard cocaine addicts, Russia pursues an energy security that is quite alien to what most Americans dreamily think it to be.
Russia uses natural gas deliveries as a blunt object to club Ukraine when it’s late on payments. Europe gets whacked, too, as Ukraine gets beaten.
Moscow wants Brussels to know that Russia means business. In a sort of “Stockholm syndrome” where hostages identify with their captors, some in Europe, especially Germans, have reacted by showing new interest in dedicated natural gas lines direct from Russia. Moscow claims that a direct pipeline is better, so that European nations don’t become “collateral damage” in the next case of Russian on Ukrainian domestic energy violence. At the same time, Moscow opposes any pipeline that comes directly from the Caspian and doesn’t cross over Russia, probably because Moscow can’t turn it on and off.
Not satisfied with the immense control that the natural gas pipeline gives Moscow over its neighbors, Russia is pursuing the building of an OPEC-style group to throttle the production of natural gas globally and to keep prices high.
The suspicion that Moscow was angling to use Somali pirates as a pretext to invite itself back into a warm water port in the Indian Ocean has proven right. The Russian and Yemeni presidents met in February and agreed that in return for a billion dollars worth of Russian weapons and in appreciation of the Russian navy’s efforts to combat Somali pirates, the Yemenis would allow the Russian fleet to use their ports.
Russia will soon be rebuilding its naval base on the island of Socotra, which historically included dry dock facilities and a giant submarine pen. Long after the Somali pirates have disappeared, the Russian navy will still be on Socotra, the strategic base from which Moscow will be able to threaten the flow of crude oil and liquid natural gas to Europe, the United States and Japan.
Russia is also luring the Japanese and Chinese to become dependent on its vast energy resources. Russia announced the building of a multibillion-dollar liquid natural gas facility in its far east that will increase exports dramatically. Russia also announced a multi-year contract to sell natural gas and oil to China.
Russia’s version of energy security looks like “energy imperialism” when viewed by its neighbors. It is assuming that the United States will remain dependent on oil and natural gas for decades to come, and consequently vulnerable to Moscow’s use of energy as a weapon.
For China, energy security means ensuring it has access to as many independent and redundant sources of oil and natural gas as it can afford. Beijing has spent the past decade scouting out new sources of oil and natural gas worldwide, negotiating leases to new and old fields, and paying often well over market rate. As prices have dropped, China has gone on an energy buying spree, and used its immense foreign exchange reserves to buy up energy leases in Asia, Africa, South and North America, and even Iraq.
Other than coal, China doesn’t have any significant energy resources. China realizes that its labor will not stay the cheapest forever. Even if it continues to exploit coal and build coal-burning electric power plants right next to coal mines — China opens a new plant every week or so — it can keep its electricity costs at only about 2 cents a kilowatt hour for so long. China looks all over the world for other nations’ oil, gas and coal.
The Spratly Islands in the South China Sea hold the promise of large offshore oil fields. China is also active in southern Sudan, where oil fields may bring new supplies. Khartoum is pushing Darfur refugees out of the way so Chinese oil companies can safely exploit those fields.
Khartoum will also probably renege on the 2011 independence referendum for the Government of Southern Sudan where the remaining oil is. It explains why GOSS was quietly buying T-72 tanks that got hijacked by the Somali pirates.
China just closed a long-term deal with Venezuela for its oil, and is scouting out yet more sources in other South and North American nations. It’s even negotiating with Cuba to drill for its offshore oil, just a few miles away from Miami. China must certainly be happy that Florida is forbidding drilling. With the marvels of modern sideways drilling, Cuba might even be able to sell U.S. crude to the Chinese and Russians.
Although China boasts of “clean energy” projects and works to convince the world that it takes wind, solar and other new energies seriously, Beijing is just as cynical and practical as Moscow about the bottom line. Judged by what they do, and not by what they say, it’s clear that the Chinese and Russians both agree that the world will remain dependent on crude oil, natural gas and coal for many decades to come. They both understand that energy security is really “energy policy” combined with old fashioned “national security.” The only difference is that Russia thinks in a more aggressive stance, while China adopts a more defensive posture, which reflects differences in their domestic energy supplies.
To most Americans, energy security still means that the United States is sending money to Arab oil kingdoms and that those dollars are getting into the hands of Islamist terrorists. But in fact the amount of money we send to Arab regimes is much exaggerated, and Islamist terrorists do not constitute as great a threat to the United States as would a reconstituted Russian empire or a new Chinese regime.
Energy security, according to the U.S. thinking, assumes that a “fortress America” at least for energy is possible and also desirable. Talk from energy experts today is about the United States stopping imports of foreign oil and gas and so decoupling from global energy markets. Instead, the nation would rely on wind, solar and wave. Such thinking is about as unrealistic as assertions from analysts a couple of years ago who claimed that the economies of India and China had “decoupled” from the United States such that even if the nation suffered a downturn, the rest of the world economy would still be pulled forward by the two new engines.
Energy isolationism is not a realistic option.
Even if the energy experts were right that imports of foreign oil and gas could be halted, the United States would still be unsafe. Removing the nation from the global crude oil and natural gas markets would make those fuels cheap and plentiful for the rest of the world. The United States would be subsidizing the growth of an all powerful China and other as yet unidentified rivals. It wouldn’t take long for China to become the world’s biggest national economy. Perhaps most ironic for those worried about global warming, the new flood of cheap and plentiful fossil fuels for developing countries would unleash the Co2 that would have been limited if emitted by the United States under any Kyoto II deal.
The bottom line: If the United States wants to get energy security right, it must pay attention to what the Russians and Chinese are thinking and doing. We need to retire the mirage of energy independence — an isolationist dream that makes no sense in a globalized world. The challenge of energy security requires marrying sound new energy policy to old fashioned national security.
Michael G. Frodl is a tax attorney, former chairman of the Environmental Law Committee of the Bar Association of Washington, D.C., and an advisor on emerging risks. He is a cofounder of the Forum for Environmental Law, Science, Engineering and Finance. His personal views do not represent those of FELSEF. He can be reached at mgfrodl@tidalwave.net.