Weaning the United States from Foreign Oil

Weaning the United States from Foreign Oil:

An Assessment of the Impact of the American Energy Security Fund on Oil Imports, Greenhouse Gas Reduction, and Job Creation

The following is an excerpt from Weaning the United States from Foreign Oil. To read the full report, please download the PDF file by clicking on the link to the left.

Clean Edge was hired the American Energy Security Fund to evaluate the impact of investments in and deployment of clean-energy technologies and energy-efficiency measures on reducing the nation’s reliance on foreign oil. The following white paper takes a look at hypothetical scenarios that measure the impact of investments on our importation of foreign oil, the potential for reducing greenhouse gasses, and the creation of new job opportunities.

In order to conduct its assessment, Clean Edge created hypothetical scenarios to measure the following:

  • Gallons of gasoline eliminated/replaced;
  • Tons of greenhouse gasses (carbon dioxide) reduced; and
  • Number of new jobs created.

Three levels of funding were examined: a commitment of $5 billion/year over ten years ($50 billion total), $10 billion/year over ten years ($100 billion total), and $15 billion/year over ten years ($150 billion total). The results of our analysis provide a compelling picture of how we could shift our current dependence on imported oil towards solutions that will enhance our security, our leadership globally in emerging technologies, and our environmental stewardship.
Some top-line findings include:

  • Over a ten-year period, we could eliminate our need to import oil from the Middle East by 40%-80%.
  • In the final year of the program (Year 10), we could displace the need for Middle East oil by as much as 98%.
  • We could remove the equivalent of up to 22% of all vehicles on the road today.
  • We could create up to three million jobs, representing over 2% of all current U.S. employment.

Our calculations, unless otherwise noted, reflect a summation of investments over a tenyear period of time. In these examples, we look at two different scenarios:

  • Baseline – in which we applied a 6% percent annual improvement in economies of scale and costs. This was a conservative multiplier based on industries such as solar which have experienced an 8% annual improvement in these criteria. In this scenario we project the average cost to replace imported Middle East oil (with alternatives such as biofuels, hybrid electric vehicles, and other technologies) at $1.24 a gallon in Year 10.
  • Accelerated – in which we doubled the baseline improvement figures to capture the potential effect that the American Energy Security Fund would have on accelerating benefits in specific technologies, such as breakthroughs in applications like cellulosic ethanol, or the positive impact this injection of money would have on tangential companies. In this scenario we project the average cost to replace imported Middle East oil at $0.62 a gallon in Year 10.

At $5 billion a year:

  • We could reduce the need for foreign oil by between 34 billion gallons and 67 billion gallons -- which equates to eliminating the need to import oil from the Middle East by between 13% and 27% over a ten year period.
  • We could reduce carbon dioxide emissions by between 153 million tons and 307 million tons -- equivalent to taking from 8 million to almost 16 million vehicles off the road or removing between 4% and 7% of all vehicles on the road in the U.S. today
  • We could create almost a million jobs over ten years, roughly the number of jobs currently in the telecommunications sector.

At $10 billion a year:

  • We could reduce the need for foreign oil by between 67 billion gallons and 134 billion gallons, representing between 27% and 53% of imported Middle East oil over a ten year period.
  • We could reduce carbon dioxide emissions by between 307 million tons and 615 million tons -- equivalent to taking from almost 16 million vehicles to 31 million vehicles off the road or removing between 7% and 14% of all vehicles on the road in the U.S. today.
  • We could create almost two million jobs over ten years, more than fifteen times the number of people currently working in oil and gas extraction.

At $15 billion a year:

  • We could reduce the need for foreign oil by between 101 billion gallons and 202 billion gallons, reducing our need for oil from the Middle East by between 40% and 80% over a ten year period.
  • We could reduce carbon dioxide emissions by between 461 million tons and 923 million tons -- equivalent to taking from almost 24 million to 47 million vehicles off the road or removing between 11% and 22% of all vehicles on the road in the U.S. today.
  • We could create almost three million jobs over ten years, representing two percent of all current employment.

Download the full report