Let’s Not Forget Our Energy Lessons!

Originally published January 16, 2015

Let's Not Forget Our Energy Lessons... Again!

The recent reduction in oil prices has come at a very good time for those of us who use heating oil to keep our homes warm. Heating bills are substantially lower than last year, and it looks like they may come down even further. So, even if the cold weather sticks around through March like it did last year, we should be paying less overall for heat. Not only are we paying less for heating our homes, but we are also paying the lowest prices for gasoline and diesel than we have seen since 2008. Happy days are here again!
 
There are many reasons for the lower prices that we are now enjoying and could potentially enjoy in the future. The biggest reason is the oil market has been booming, and huge amounts of petroleum are being pumped out of the ground. The high prices of the last eight years have been a great incentive for companies and countries to go out and find new sources of oil, pump them out of the ground and bring them to market.

Let’s talk about the next important reason for these low prices – Reduced demand. There are three main reasons for this:

1. The world economy is not strong right now, and when the economy goes down, demand for petroleum goes down.
2. People are using more alternative energy sources instead of fossil fuels. Biomass, solar, wind, geothermal and other sources are being used to heat and cool buildings, generate electricity and power vehicles.
3. New technologies now enable us to be much more efficient with the fuels that we use. Cars and trucks go further on a gallon of gasoline or diesel, houses are tighter and better insulated, and heating systems can achieve 90-plus percent efficiency.

My purpose for writing this blog is to remind those who remember the energy crisis of the 1970s, and to educate those born later, that we missed an opportunity to get our country on the right track energy-wise. There was a strong commitment by most of us in the nation to find alternative fuels and to become more efficient in using those fuels. We had strong incentives, AVAILABILITY and MONEY! Our prices for petroleum jumped up significantly, and we became fearful that the supply was running out. Many of us considered it our patriotic duty to conserve energy!

So we started down the road to becoming more energy independent and conservative in our use of fossil fuels. But we took a wrong turn in the 80s and went back full throttle to our old ways, which has resulted in some high demand/high prices over these past few years. The history of petroleum prices includes a series of wild swings in price, and I don’t believe that we will ever see that change. What I do believe is that we all have an impact on the future price of energy by doing what we should have done in the 70s, and that is to live more conservatively. Buy the Focus instead of the Mustang.

​Bob

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