Stoft takes on what he calls the "twin challenges:" energy security and climate stability. And I give him a lot of credit for writing the only book I've seen that takes both of these seriously and offers solutions that can work for both at once. His proposals make so much sense that the book makes me feel a little better—maybe we can actually kick our oil habit and save the planet from overheating.
Stoft is an energy economist, and he's backed by some energy experts, including physicist Art Rosenfeld, "the father of energy efficiency," and several economists, like Nobel economist George Akerloff. He's balanced in criticizing pundits of various stripes. He takes on global warming alarmists as well as deniers, "peak oil" pessimists as well as technological optimists, and others. He presents economic concepts clearly and presents historical evidence and common-sense explanations to support his critiques and proposals. Even though most of the ideas have been floating around for a while, the book is very useful for collecting a lot of great ideas and presenting them in an easy-to-understand package. Some of his major points are ...
• Done right, an effective energy policy is not free, but certainly affordable. The cost might be about 2% of national income by 2050—that is, less than a one-year delay in economic growth.
• Yes, there are uncertainties in global warming predictions, but uncertainty is the problem. The risks are real; with so much at risk it makes sense to buy some insurance.
• Oil may "peak," and production decline, but our economy can and will cope with that.
• OPEC tested the effect of high oil prices once before, with the "oil crisis" of 1973 through 1985. High oil prices worked to reduce energy use—and, by the way, cut CO2 emissions—so well that OPEC collapsed in 1985. But we grew complacent in the following two decades, and now look where we are.
• We can learn from what OPEC did. We can cut oil imports and CO2 emissions without the extreme pain of sending trillions of dollars to petro-dictators. Stoft recommends an "untax"—a tax on fossil fuels (CO2 emissions), with 100% of the revenues refunded directly to consumers, just as Alaska sends its citizens a check every year from its oil revenues. (Yes, this would work, and the book explains why.)
• Stoft points out that any climate treaty works nicely as a "consumers' cartel" that can counter the power of the OPEC cartel. This will reduce the price we pay OPEC (and Exxon) and will reduce oil imports. I think he's right when he says that the "climate camp" and the "energy-independence camp" should join forces to make progress. Their goals dovetail: we can fix the climate, beat OPEC and save enough money to pay for switching to new energy sources.
Being an economist, Stoft puts a lot of faith in energy prices as the principal driver for the changes and innovation we need. Not everyone agrees, but as I said, he makes his case with historical evidence. And he admits "the market" doesn't always work. For example, he says car buyers are not rational and proposes interesting incentives to increase mileage, and he backs subsidies for advanced energy research.
He takes good ideas from wherever he finds them, citing both Bush's economic advisor and James Hansen (Gore's science advisor), although he adjusts the ideas as needed. The book maintains a friendly, conversational tone, which makes for easy reading, and includes quite a few interesting tidbits. Sidebars with technical details are available for those interested.
Basically, I feel better after reading this book; we can achieve energy security and climate stability. Now let's get the powers-that-be to pay attention!
