Keith Hennessy had a great blog post on “Oil Spill Crisis as Opportunity” where he makes the following suggestion for new legislation:

Imagine that the President proposes new legislation targeted at the problem of engineering safety in deepwater drilling.  Imagine his legislation contains five provisions:

  1. Require that all deepwater wells have a relief well in place before production begins.
  2. Mandate requirements for double piping and a list of other industry engineering best practices.  The prior best practice for engineering safety becomes the legally mandated minimum.
  3. Mandate that each deepwater drilling operation be insured for at least $20 B of environmental damage before production can begin.  Insurers will therefore require further engineering stringency to protect themselves.
  4. Raise the legal liability cap for any drilling platform to $50 B, just to be safe.
  5. All new wells must meet all of the above requirements, and all existing wells must cease production until they meet them.  (The details here might need some work.)

He makes this suggestion after offering the following analysis of current energy consumption usage patterns and the limits of battery technology:

If you are focused on carbon emissions, then oil, coal, and natural gas naturally group together as “fossil fuels” and are the combined source of the problem.  If you are focused on energy, then oil is one issue (transportation), and coal and natural gas are another (electric power).

We use almost no oil to produce power in the U.S., and electricity powers only a tiny fraction of our transportation, despite recent increases in hybrid and natural gas vehicles.  Yes, they’re growing at a rapid rate.  But the overlap between oil as one type of energy source vs. coal and natural gas as another is vanishingly small.

Someday when battery technologies improve, the fuel and power worlds will blend in the U.S., and there will be strong and direct economic relationships between the production of electric power and the use of oil.  Until that day, from an energy perspective, “fossil fuels” conflates oil with coal and natural gas in a way that is at best confusing and at worst misleading.  Substituting biofuels for oil or making vehicles more fuel efficient has almost no effect on the amount of coal or natural gas we use.  “Produc[ing] wind turbines,” “installing energy-efficient windows, and small businesses making solar panels” are quantitatively irrelevant to our use and production of oil.  All the windmills and solar panels you could imagine will not reduce our dependence on oil as a transportation fuel.

He has a great chart and more details, go read the whole post.