Renewables religion is dangerous

It could destroy our nation's best opportunity to get strong and create more jobs.

By Jim Cramer Sep 17, 2013 9:26AM

thestreet logoOil drums (© Kevin Phillips/Digital Vision/age fotostock)I am giving up on any hope that Congress will understand the carbon/fossil fuel renaissance in this country.

 

On Monday, we interviewed Sen. Max Baucus, D-Mont., an energy and mineral-rich state. He was holding a conference on the economy, including a presentation involving the Bakken, which will soon be producing 1 million barrels a day, up from about 300,000 a couple of years ago.


I thought: Here we go, commonsense senator from a reasonable state where mining jobs had always been a mainstay of the economy. So I asked a benign question about whether they would be discussing the positive prospects of all the newfound energy in this country and what it means for the U.S. economy, given the Bakken segment of his conference.

 

The senator wasted no time getting right to the heart of the matter: the importance of renewable energy. I almost fell out of my chair. I figured this was the one senator who might actually admit that we are close to energy independence on the continent, provided we can get the oil and gas where it is needed, something that would create a huge number of jobs. Nope, it's all about renewables, all about subsidized power. It's all about the government helping an industry that can't solve the big issue, which is how to stop the importation of oil from countries that aren't friendly with the United States while hiring many more people in this country. I figured he would at least give me some love on natural gas, which is cleaner than so many other fuels, certainly dirty diesel, which is responsible for 25% of our imported fuel.


Nah, renewables.


I pressed. How about all of the jobs that could be created if we just had a program that could get the unemployed where the jobs are in the Bakken and the Eagle Ford and the other shales that are oil and gas rich but people poor.


Nope, he wanted to talk about training people. Darn it, the companies will train them. They are willing to pay well above the nation's average if they can just find a way to get the people to these godforsaken places. The government doesn't need to train a soul.


I was going to follow up with a question about Keystone, but I knew it was just hopeless.

This squandered opportunity is painful, even as objection after objection has been met. Two years ago The New York Times took after the natural gas industry, saying there wasn't enough of it to justify the possibility of using it for a surface fuel. I was so disgusted  because already the glut was so evident that we would have to burn off more natural gas -- a natural byproduct of oil drilling -- that I contacted the ombudsman and got a critical word in about the coverage.

Then the objection was drinking water and "Gasland." Encana (ECA) had a couple of wells that environmentalists charged were leaking gas. The EPA was all over it but upon proper investigation found that there was no issue and no leak from Encana.


Then it was methane pollution and how drilling for natural gas caused more particulate damage than people thought, which meant it was no cleaner than oil. This came despite a dramatic decline in our own carbon footprint because of our aggressive switch to burning natural gas, not coal, as a power-plant fuel. A University of Texas study showed that the government was dramatically overstating the methane leakage and that it wasn't even a real issue.


It's all coming together to use natural gas as a surface fuel, except Congress wants to talk only about renewables and the importance of the government's getting behind them, not unlike the Spanish thrust to do so, which almost bankrupted that state. The U.K. went that way, too, and it cost them mightily.


I think that we are on some sort of ridiculous path that simply won't acknowledge the potential here for self-sufficiency. We are exporting 2 million barrels of gasoline a day because of rules that don't let us ship it to where it is needed unless the tankers fly under U.S. flags, which almost none do. That jacks up our gasoline prices in the Northeast, which I now believe is by design to use less fuel. The military seems not to care about the leverage our nation has over the Middle East if we didn't need its oil, which we wouldn't if we embraced natural gas as a surface fuel. We know the skies would be cleaner. We know pipelines punch above their weight when it comes to job creation.

 

But they only want to talk renewables. It is a religion, one that can't be touched. And it could destroy our nation's best opportunity to get strong and create more jobs instantly.

 

We have such a surfeit of natural gas right now that we have virtually stopped drilling. We are permitting export plants all over the place that won't be built. It is almost as if we are suicidal.

 

Mark my words: We are going to crucify our nation on a cross of renewables.

 

It's insanity.

 

Cramer 

 

Jim Cramer is a co-founder of TheStreet and contributes daily market commentary to the financial news network's sites. Follow his trades for Action Alerts PLUS, which Cramer co-manages as a charitable trust.

 

 

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73Comments
Sep 17, 2013 9:46AM
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Globalization is the plan.  The giving away of the last 100 years of assets this country has amassed is the present game plan.  Much like Merkel giving away the bounty of the German citizenry our electerds are doing exactly the same.  It makes no sense Jim because you are on the wrong side of the issue.  Think about appeasing the rest of the world. Think about attempting to jack up all the developing economies of the world and maintaining them at the expense of our kids and grandkids.  You have to get new glasses Jim because what should be in focus isn't in focus.  It is no longer vogue to think American from a political stand point.  Think about the youngster in Indonesia that needs a hand up.  Forget about the kid in Detroit.  My fear is instead of raising opportunities for the rest of the World these politicans will merely lower the bar for everyone in the world.  But come to think of it, isn't that pretty much all they ever do.  JMHO
Sep 17, 2013 10:29AM
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This just in! A new study warns of long term debt!  LMAO  I should get paid to write these articles.

Sep 17, 2013 11:27AM
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I see our present energy plan as a half hearted attempt to quell mainstream complaining only, while the entire time the rich liberal elites behind the scene hate fossil fuel and regardless of the cost want it removed from our futures. 
Sep 17, 2013 11:55AM
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There have been some Major oil/ngas finds in recent times in the Americas or Western Hemisphere.

 

Oil and Tar Sands in Canada...

Monster Deposits off-shore Brazil and other un-tapped deposits in S. America.

New finds in the Gulf area adding to reserves..

Mexico with some unknowns, with little Activity(from outside), because of crime and Political strife.

Shale and other fields being opened in about  4 or more areas of the U.S.

Plus what we still have, in portions of Alaska un-tapped.

OPEC should be put on notice and I think they might be paying attention.?

 

Sep 17, 2013 11:49AM
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Democrats are perpetual teenagers believing in all manner of fantasies like renewable energy which has never existed anywhere without the aid of taxpayer support to do what the market cannot - buy it.

America needs real energy - oil, natural gas, nuclear, coal. What we don't need is tree hugging dreamers and tax money hungry schemers getting in the way of economic growth.

Sep 17, 2013 1:00PM
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I will say one really good thing about renewables........ they offer true options for getting off the grid.
Sep 17, 2013 11:33AM
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One of the best articles I have ever read from Jim Cramer. He is so right on this it is refreshing. If there was one thing most people who have already commented partly negative is we ship 100's of billions of dollars overseas to buy oil and oil related products. We can keep almost all of that $ in the US, and if we do, i has the potential for real GDP & income growth in the US. 

To those who claim we should conserve this scarce resource: we have never done a good job understanding how much oil there is, & we already have many places where we don't drill that we know there is a ton of oil.
Sep 17, 2013 10:07AM
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Pipelines are being built....Everywhere.

Some are being replaced or upgraded...

Rail cars are hauling oil and fuel....At a much higher rate then just a few years ago...

Cheaper than trucking, and pipelines have not been completed.

 

The Keystone pipe, although a producer of jobs; May not add a lot of oil to our base, but could have some bearing on prices...Being held up mostly by States and Environmental  Groups.

More refineries are needed, at least 2-3 maybe 4, then prices should start going lower.

And usage of Natural Gas, should be expanded and then add Green Energy to the mix.

And there are alternatives to making Coal burn "cleaner."

All the above will make us completely energy independent, and maybe a "net" seller.

Sep 17, 2013 1:14PM
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If renewable energy was cheaper, we will stop using oil and gasoline... and we will get off the grid, 
Sep 17, 2013 10:34AM
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Jim, If we conserve the resources we have now (oil and Gas) and mix in some renewable energy, then we can make our supply last longer... correct? Isn't the whole goal to get off of imported energy and never go back? I think we need both. Also, the renewable energy sector is also creating lots of jobs, so the jobs are not just in oil and gas.
Sep 17, 2013 12:59PM
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You forget one thing FriendofJack. Obama and the green energy rich people are just as crooked as Bush and the oil companies.........  It is just a diversion of our money to a different set of crooks. Sounds good..... the same as "we have enough oil to be independent" ........ but it means nothing.
Sep 17, 2013 1:19PM
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80% of the universe it's hydrogen based. The Sun, the stars, the H bomb, our bodies everything that moves (with the exception of Petroleum based technology) runs in hydrogen. Lavoisier discovered that during the French revolution. He was able to split hydrogen from oxygen from water. In NASA all the new technology it's based in deuterium (Improved Hydrogen).  No contamination, pure energy, eventually, no need of middle man (that's the real problem here)..No corporations, eternal source of power, here and everywhere from a glass of water to the end of the universe. Bad idea. No wars, no CEO, no lobbies, no Exon Valdez, no Osamas, no Middle East, no War contractors..No good..
The good part it's change it's not part of life. Change it's life. If you want to get rich, you have to take advice from a Rich, not from a salesman. They will always wanna give you something that worth a lot less than you pay for..
Sep 17, 2013 1:07PM
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Natural gas is so under utilized it pathetic. I won't go into all the reasons why as it would take more time and space then I currently have. Therefore, I shell just point the finger at the folks in D.C. for again not recognizing the value of a natural resource that has the potential to rescue us from the strangle hold foreign crude oil producers and their importers have on this country. It's shameful.  
Sep 17, 2013 12:52PM
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If you think of it from a strictly short-term net-profit standpoint, yes renewables are not the best option.  You can't make money fast enough (instantly) on them.  And that's all everyone cares about.  But renewables are a long play.  If we could supply a majority or all of the electricity the US needs via wind/solar/nuclear/etc imagine what we could do with all that oil and gas at our disposal?  You could sell it to everyone that doesn't have the renewable energy sources like us.  You could stockpile it for some future need.  You could tell the Middle East "We're good - we don't need your oil.  Thanks for the memories."  You could make the US a powerhouse not beholden to the whims of a global energy market that can set it own policy, not trying to play the big dog and scare everyone else around.  Oil is finite - the sun never stops shining/wind never stops blowing.
Sep 17, 2013 9:55AM
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our energy plan should consider all forms available as a salt and pepper approach.  use oil, natural gas, NUCLEAR for the big output.  use water, wind, solar for supplemental energy - mainly at the homeowner or small business level. 

 

it's ludicrous to use big windmills for intermittent energy.  it's silly to use miles wide land for solar to then be land used for nothing else. 

 

jimmy - you pitch natural gas constantly.  fine.  i get it.  but if natural gas had/has such value, WHY aren't the big oil companies installing more natural gas distribution centers?  such as for use in cars?  THEY have the money yet THEY don't see the value in investing in themselves?  there's an answer in there for you. 

 

 

Sep 17, 2013 9:54AM
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Cramer - if you actually thought Max Baucus would be interested in real energy independence and job creation by exploiting fossil fuels, you are a naive, politically ignorant fool.
Sep 17, 2013 11:07AM
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Mr Cramer, I thought you would write about the Fed meeting .. 
Sep 17, 2013 10:45AM
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The problem is we never have had nor do we have a national energy policy.  Wingnuts would call it socialism & want the market to determine things. We need an intermediate plan and a long term plan.  The intermediate plan relies on what we have (natural gas & oil) and gradually weens us off carbon based fuels.  At the same time it tells most of the current oil producing countries where to go.  The long term plan develops less polluting 'clean' energy sources.  However, no politician would have the guts to embrace this type of plan because they are ALL beholden to big oil.  If we had a policy along these lines we could reinvigorate the economy in 2 years time & have suplusses in 5 years time.
Sep 17, 2013 1:22PM
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I don't think it's a god idea to dot the landscape with oil and gas wells. Leave it in the ground. Forever. Nobody knows the long term environmental impact of large scale fracking. It's foolish to rapidly expand this activity. The only reason renewables are expensive compared to oil & gas is because oil & gas are heavily subsidized, with indirect costs  (pollution and health effects primarily) hidden and often ignored. Expanded fracking is not a panacea, and will not save our economy. 
Sep 17, 2013 12:33PM
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Sadly, market manipulators consider honest investors fair game. How many times have they  played honest investors over QE?  So often, I fear we have come to expect it.
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