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The Search for Alternative Energy

Clif Droke
April 11th, 2005

Lately the energy sector has dominated the headlines. Rising oil, gas and electricity prices have taken a toll on the consumer’s wallet not to mention the rising cost of production and transportation across the general economy.

In such times it’s easy to get caught up in the fear-laden rhetoric of the mainstream press and the talk of $100/barrel oil. The press is apparently so confident that oil will keep rising and that consumers will spend more on gasoline this summer that the following presumptuous headlines have recently appeared: "Oil to rise despite step back from all-time high," "Oil to explode higher analysts say," "Americans will pay high price at the pump this summer." Considering that newspapers aren’t supposed to be in the forecasting business these headlines sound a bit too much like they are doing someone’s propaganda (i.e., psychological prep work)...wouldn’t you agree?

Or maybe the media have simply gotten carried away in all the excitement. The press articles cite surging oil prices, refineries "running nearly flat out" and demand for gasoline and diesel growing as the rationale for their "safe bet" that motorists will be paying a significant premium at the pump this summer. And who knows, maybe we will!

Business Week magazine in the April 11 issue points out that since 2000 the average cost of a gallon of self-serve gasoline shot up 39% from $1.51 to $2.10. Curiously, they didn’t mention how today’s prices compare with those 1998 when crude oil futures were around $10/barrel and gas at the pump in many locations was around $1.00/gallon! "With record-breaking oil prices and expected seasonal summer price hikes, experts see no relief in sight," said BW.

Already the gasoline price situation is hitting ridiculous extremes. Last week the national average price of unleaded regular hit $2.22 a gallon, up from $1.78 a year ago, according to the U.S. Energy Department. In some parts of the country, prices have already zoomed past that mark. And of course the energy analysts are forecasting even higher prices for the near future. "Barring a reversal (of the run-up in crude prices), a jump in the retail pump price to $2.45 a gallon by Memorial Day — the traditional start of the summer driving season and the traditional seasonal peak for gasoline prices — now seems likely," Morgan Stanley chief economist Richard Berner wrote in a report last week.

According to one media source, the relentless rise in energy costs is beginning to put pressure on Congress and the White House. "The White House is working to speed construction of new refineries and spur investment in alternate energy sources," the report said. But what kind of "alternate energy sources?" is the question that immediately comes to mind. If it’s anything like past recommendations by the federal government in this area they will likely prove to be woefully inadequate in meeting the country’s rising energy needs.

What the country needs now more than ever is access to viable alternative energy technologies...technologies that have been in existence for many years and have a proven record of successful applications on the consumer and industrial levels. The problem, though, with getting such technologies to the market is none other than Uncle Sam himself. Or perhaps another way of saying this is that Big Oil won’t let Uncle Sam grant access to alternative energy sources that threaten the petroleum industry.

This tendency toward suppression of low-cost, high-efficiency alternative energy sources is nothing new. Many years ago, the famous financier J.P. Morgan essentially shut down the extremely promising experiments of Nikola Tesla, who promised to provide "free energy" to the country and eventually the world through his remarkable breakthroughs in electricity research and the wireless transmission of energy. The banking cartels of that time supported the old-fashioned (and much more expensive) forms of energy would hear nothing of it. The more things change, the more they stay the same...

Most of these alternative energies are being funded by private investors, which in part explains the lack of mainstream availability. Not only are the companies that produce such alternate, non-petro-based energies denied sanction by the government, they are also attacked by academia as being "scientifically unfeasible" and denied coverage by the mainstream press.

Such is the plight of promising alternative energy sources in the areas of fuel cell and cold fusion research, for example. There was a time back in the 1990s when interest in cold fusion was skyrocketing and the technology threatened to break into the mainstream. The work of Dr. Eugene Mallove and others was gaining in popularity and cold fusion was proven in laboratories numerous times including public demonstrations at MIT. Even petroleum companies like Amoco and Bechtel have been involved in cold fusion research and experimentation. For instance, Bechtel has explored the economics of cold fusion and concludes that generator units operating at 10-20kw will encourage power users to gradually unplug from the power networks.

Back in 1999 the U.S. Department of energy (DOE) was to sponsor a public conference on cold fusion in Bethesda, Maryland but pulled out at the last minute (but not before taking the names, addresses, and Social Security numbers of the attendees). As publisher of Dr. Antony Sutton’s several books on cold fusion at that time (including the breakthrough work "Cold Fusion: Secret Energy Revolution") I was among those in attendance and the research and technologies presented at the conference was truly astounding.

There is hope for cold fusion gaining access to the marketplace, however. The DOE has been reviewing it off and on for years and an executive summary is pending and was due to be submitted to the Office of Science before the end of 2004. The Office of Science is to release the information to the public.

Then there is the fuel cell industry. For those not familiar with this promising technology, fuel cells convert the chemicals hydrogen and oxygen into water and in the process produces electricity.

Some types of fuel cells work well for use in stationary power generation plants, while others may be useful for small portable applications or for powering cars. The proton exchange membrane fuel cell (PEMFC) is one of the most promising technologies and is the type of fuel cell that will most likely end up powering cars (prototype fuel cell-powered cars have already been developed), buses and possibly even homes.

Another major developing area in the alternate energy arena is nanotechnology, which has applications too numerous to mention here. The energy-enhancing possibilities of nanotech were discussed in the recently published book "Bottomless Well" by Peter Huber and Mark Mills. The authors argue throughout the book that "energy isn’t the problem, energy is the solution" and that "energy begets more energy; tomorrow’s supply is determined by today’s consumption. The more energy we seize and use, the more adept we become at finding and seizing still more."

The good news about rising fuel and energy prices is that above $40/barrel oil, it becomes economically feasible to rigorously pursue alternatives to oil-based fuels. Hopefully this is just what we’ll witness in the months and years ahead and especially in the scientific fields briefly discussed here.

--Clif Droke
April 11th, 2005

email: clif@clifdroke.com

©2002-2005 Publishing Concepts. All Rights Reserved.

Clif Droke is the editor of the Gold Strategies Review newsletter, a technical forecast and overview of precious metals and North American gold stocks available at www.clifdroke.com . He is also the author of numerous financial books, including most recently "Gold Stock Almanac 2005."