Solving Energy Crisis

Solving the energy crisis

 

There will be greater increases in the demand for crude oil up to the year 2013 and beyond.  The sharp rise in demand during the past few years drove the prices of crude oil to soaring highs. By almost the same time last year, prices of crude had increased already fifteen times.  Due to the skyrocketing prices, demand slowed but there is no reining in the inevitable growth of the demand for fuel oil.  Hence, the predicted 3.7 percent rise in consumption whether we like it or not, will put pressure upon the oil supplier countries and they will again raise their prices.  It will be a never-ending evil cycle.  And no one will have the power to stop it.  Department of Energy (DOE) will look like shit in the face of it.

 

As early as 2002, there was a great deal of rejoicing over the find of lower priced crude to come from Russia and Iran.  The purchase of the crude never actually happened.  A lot of factors prevented the deal to push through and I was part of it although from a remote distance.

 

The Russian crude at the time was being priced only at 9.00 per liter or even much cheaper on the low side of the fluctuating behavior of crude prices.  However, it was possible to peg through a formal agreement, the price of crude so that it will stay locked on to a specific rate and not follow the behavior of the price of crude oil.

 

To  make matters worse, the local buyers and dealerships, were meticulous about moisture that they registered their vehement resistance to the offer of cheaper crude just because compared to the prevalent crude oil from other sources our crude had 3.0% moisture content while the rest of the universe was selling oil with 2.0%.

 

As added insult to injury, it was announced by scientists later that water could be mixed with gasoline (or possibly diesel) to make the engine run more smoothly than you would have ever seen.

 

If I am not mistaken, up to 200 ml. of water can be used as additive for every one of about 55 liters of gasoline in the engine.  So what were the local buyers concerned about a small 1% difference in the recorded specs of crude from all other sources.

 

However, were it true that fuel is less expensive if the country sticks to cheaper sellers like Russia and Iran, among others, then I don’t know why the country had recently not considered using the option of buying the item from Russia and mid-East countries like Iran.

 

Before parting ways, most of my fellows sympathized and supported my advocacy for not deregulating the oil industry in 1990-1991 unless the country, this Republic of the Philippines, increased it’s oil refining capacity.

 

My fight was for naught since I lost and was shamed by the impunity with which the government rammed oil deregulation legislation into the collective throats of more than eighty million Filipinos.  I was already away when that happened but the pain was not lessened by the great distance.

 

This time, I make my pitch anew:

 

To ease the people’s burden, government shall embark into an ambitious, expensive project of building refineries to augment our refining capacity of 1-2% of the total national requirement.

 

Private sector like Shell is already considering building a USD 1 billion to USD 1.5 billion expansion facility of its refinery in Batangas.

 

Government can follow suit by (1) encouraging Shell’s rivals; or (2) going into the refinery building activity itself.

 

Another item that government can possibly undertake is to scrap the VAT subsidies considerably and use them in food-for-work projects to produce and harvest natural gas such as that from biowastes  or harness new sources of natural gas (NG).

 

Government and private sector should already go into the joint effort of building a network of refilling and pumping stations for natural gas.  Vehicles built on NG machines are now readily available from China and other countries.  The deal with China for the supply of custombuilt NG cars, buses and even motorbikes, has not been implemented up to this time.  And already, it had been a very long wait!  What happened here?

 

While agreements were signed many years ago in China and here, the sad fact is that the company that signed the agreements with China had no real money to front end the cost of importation of the NG vehicles.  Banks refused to consider lending for NG vehicle importation purposes a viable business.  And so the country suffers from massive hemorrhage of its foreign currency reserves in the importation of expensive crude oil.  Whereas, packaging and distribution costs for our own natural gas in Palawan and possibly many other in-country sources is much, much cheaper in the long run than buying foreign crude.

 

Both the government and the private sector are to blame for serious oversights in this regard.  But the blaming cannot go on forever.  Some action needs to be seen and fast.

 

Conserving energy is also going to help in the current crisis.  But that again has to be done on a wide and massive scale if it has to be economically viable.  Government offices limiting the time of use of light and air conditioning units is not part of the solution.  Actual resource recovery (savings) measures should be done as if it were a religion and every single worker, supervisor, manager and company owner or public sector executive has to take part in the process.  The resulting savings or resource recovered will be enough to stave off crude importation by a huge margin.  That is why many years ago, I had already been proposing a resource recovery movement, long before the present crisis struck and hit us all in the gut.  Sadly, before thinking of resource recovery, corruption is foremost in the minds of both government workers and officials and their counterparts in the private sector.  Tsk!  Tsk!

 

To recap, what I was saying:

 

To combat the negative net effect of oil deregulation, the refining capacity of the country has to be doubled, tripled, quadrupled many times over.  A measly 1-2% refining capability of the total national fuel oil requirement is definitely not good but foolhardy.  It practically washes away the justification for the passage of the EPIRA law, which is to all our minds now, is full of bull shit.  And the presidents and leaders of our legislative bodies that allowed its passage were abject fools and supreme traitors to the country.

 

Switch to alternative energy sources like natural gas must now more than ever be supported, especially by banks and the entire gamut of the public and private sectors.

 

Resource recovery measures should be undertaken by everyone as if the country were just one big movement.

 

Aside from NG, government and private sector should push for wind, solar and other energy sources, renewable or non-renewable.  And where there are solar panels, the NPA should pledge not or never to steal them, like they have been doing since the 80s so that they can have their sustainable mobile source of power.  Maawa naman sila sa bayan.

 

In this article, I have continually emphasized the cooperation between the government and the private business sector.  This cannot be ignored.  If the rebels in the Makati Business Club and other business groups will continue financing the proposals for coup d’ etat, people power and other foolish adventurisms of the enemies of the government, there is no way for the country to go but down.  One day, the Makati Business Club rebels will wake up to a country torn by civil war and their own offices and homes taken over by hungry warmongers that suddenly just appeared from wormholes in the underworld dimension.  Bad for them.

 

Finally, the entire populace should summon its very last resolve to prepare for the worst that is yet to come and to join hands in seeking solutions to the smaller problems that could blow into huge irreparable proportions when the final kick of the global crises happens.  To those that have nothing constructive to do, this I say:  shut up and die!