OPINION: We need to act on energy security

With the president’s renewed focus on energy security, it is critical to understand the global efforts to address this issue, and for the United States to lead the way. I recently led a group of former public officials and senior business executives on a week-long trip to China to explore energy security issues. In meetings with senior executives, government officials and academics, we gained a better understanding of China’s energy challenges and the actions they are taking.

The trip reaffirmed our belief that while the United States and China share many energy-related concerns and goals, we also have different needs. Americans generally think of energy security as an oil issue, centered in the Middle East. In China it is an electrical power issue, as their government struggles to ensure sufficient generating and distribution capacity.

Dependence on oil is a critical issue for both countries — China is acutely aware of its growing demand for oil. In the past two years, China has become both the world’s largest manufacturer of light-duty vehicles and their largest market. Yet it still has only 36 cars per 1,000 people, versus 850 cars per 1,000 people in the United States. Anyone who has spent an afternoon stuck in Beijing traffic can imagine the challenge China faces as they continue to add cars to their roads. To meet this growing demand, China will have to import more oil over time.

Unlike the United States, where the government generally takes a hands-off approach to oil markets, the Chinese government, through its state-owned enterprises, has sought to obtain physical hedges against higher oil prices and supply shortages through investments in foreign energy projects in Africa, the Middle East and elsewhere.

There is no free market for oil, and China’s activities make the oil market even less free. The United States must make smart and realistic policy decisions to support its national interests.

China has taken an active approach on the demand side as well: For years, it has had a more aggressive approach to fuel economy than the United States. In fact, our fuel standards through 2016 are lower than those now in place in China. Most importantly, China has an intense commitment to the manufacture and deployment of electric vehicles as a way to reduce oil consumption.

To those of us concerned with American energy security, Chinese efforts on electric vehicles are impressive and challenging. China believes it is at a comparative disadvantage in the production of internal combustion engine vehicles, but views EVs as a nascent technology at which they can compete — and perhaps lead — internationally. American policymakers and manufacturers need to understand — and respond.

To promote their development, China has selected 15 demonstration communities to roll out programs to deploy electric drive vehicles, with communities having different focuses, such as buses, taxis or private vehicles. The government has dedicated more than $15 billion to support its effort, including incentives for new car buyers, and establishing a goal of selling 1 million new EVs annually by 2015.

From an economic and national security standpoint, there is an urgent need in the United States to sever our transportation system from oil. When prices go up, what can we do? There is nothing else to put in our cars and trucks. We have to pay more or drive less. 

There is little disagreement today that oil dependence poses a real and immediate danger to our nation. Events in the Middle East over the last few months — including the resulting spike in oil prices and our military involvement — prove the point. Turmoil in Bahrain takes place near a major military headquarters, and in Libya we are forced to choose between permitting heavy Libyan casualties or taking military action. Our oil dependence leaves us only bad alternatives.

Electrification offers a path toward a safer, stronger nation. But who will be paving that path — China or the United States? They are committed. We should be as well. China is not an enemy, but it is not in our interests to fall behind them, nor to be dependent on them for cutting-edge technology that we need to safeguard our economy and our future. It is time for the U.S. to commit to electrification.

Blair is a former Director of National 
Intelligence and commander in chief of U.S. Pacific Command. He is a member of the Energy Security Leadership Council.