The Pickens Plan: As Good As It Seems?

You’ve probably seen the commercials – actually, they’re sort of impossible to miss.  T. Boone Pickens, looking folksy in his chambray shirt, talking about how he has been an Oil Man for over 50 years and how he’s got a real plan to break our dependence on foreign oil.  I love these ads because I want to believe Mr. Pickens with all my heart.  I want to believe that the answer to our oil addiction might be as simple as switching our cars over to clean natural gas to buy us time to develop renewable alternatives that will eventually get us off of oil completely.  But I’m skeptical.  We’ve been fooled before.  So I decided to take a deeper look at this man and his plan…

Is The Pickens Plan really as good as it seems?

The Man

T. Boone Pickens is indeed a former oil man – in fact, he is worth at least 3 billion dollars and made most of that fortune in the oil business. He started as a geologist for Phillips Petroleum in the early 1950’s, and then went on to create Mesa Petroleum and Petroleum Exploration. Pickens’ belief in acquisition rather than further exploration in the 1980s, lead to his notoriety as a take-over giant and his ranking as Forbes 117th-richest person in America. Pickens was also known for his hefty financial support of George W. Bush, the Republican Party and the 2004 Swift boat ads that helped derail John Kerry’s bid for the presidency.

But today, T. Boone is all about clean tech energy and he has renounced his Republican affiliations in order to pursue his passion for changing the hearts and minds of Americans to the belief that natural gas and renewable sources like wind and solar are our best and most possible hope for a better future.

The Washington Post verbally scratched its head at Pickens new persona: “The billionaire speculator as energy wise man, an oil-and-gas magnate as champion of wind power, and a lifetime Republican who has become a fellow traveler among environmentally minded Democrats.” I say, good for you T. Boone!  Now let’s look at the Plan.

The Plan

Mr. Pickens feels that world oil production has reached its peak and can no longer meet the demands of global consumption.  In fact, he feels that it is on the decline and we’ll be out of oil before we have an alternative if we don’t do something now.  The Plan proposes that we replace the natural gas currently being used for grid power (electricity) with wind power (which he has invested heavily in) and then take the excess natural gas and use that for transportation fuel, replacing gasoline wherever possible until technology catches up with a renewable fuel source for our cars. 

Pickens believes that by doing this, we can reduce our yearly foreign oil imports from $700 billion down to $400 billion in the next ten years.  That sounds pretty good.  Another thing that raises my hopes is that the Plan has been endorsed by Carl Pope, executive director of the Sierra Club, who is usually quite vocal about things that are bad for the environment.  To read the entire plan: The Pickens Plan

The Verdict

Pickens has been criticized for creating a plan from which he might stand to gain quite a bit, having already invested nearly 12 billion dollars in wind technology.  His standard rebuttal to this accusation is: “I’m 80 years old, and I’m worth $4 billion. I have plenty of money.  I think it shows leadership that I’m putting my money into the wind business, and I’m willing to put my money where my mouth is.”  He testified in front of congress in July of this year that his plan would not only reduce our foreign oil consumption by switching cars to natural gas, it would create new jobs in clean technology throughout the wind corridor of the United States, an area in the middle of the country that stretches from the Canadian border, through the Great Plains and into Texas. 

The biggest impediment to the Plan, however, seems to be the number of hurdles that need to be gotten over in order for the Plan to succeed.  They include:

+  The monetary and environmental costs of building enough wind turbines to meet our power needs 
+  The assumption that wind power will adequately replace the natural gas proposed for transportation fuel
+  Connecting that power to large cities through approximately 40,000 miles of transmission lines
+  Switching millions of drivers over to natural gas vehicles
+  Creating enough natural gas filling stations to support all of those cars       
+  Over-coming a gridlocked political system
+  Navigating a severely weakened economy  

Mr. Pickens is quick to point out that his plan isn’t a complete solution, it is “a bridge to the future — a blueprint to reduce foreign oil dependence by harnessing domestic energy alternatives, and buy us time to develop even greater new technologies.”  With gas prices so high and the economy teetering on the edge, the Plan does seem like a real challenge and yet better than some other ideas floating around out there.  We all know that something has to change and it might mean that we have to make some short-term sacrifices to gain long-term benefits.  

If Mr. Pickens has enough energy at 80 to commit to an idea that will take that much money, hard work and tenacity, then I say let him try.  Maybe it’s just the Game Changer we need to take a serious step in the right direction.