OIL SUPPLY: LCFS: A Great Blow to American Security

ARLINGTON Earlier this month, it was announced in Washington that the chairman of the Senate Foreign Relations Committee would be named the lead sponsor of a cap-and-trade bill in large part au thored by the chairwoman of the Senate Environment Committee.

The listing was not accidental: As the debate over climate policy in Congress has evolved over the past few months, proponents of a policy that seeks to ration the amount and type of energy available to the American people have come to recognize their success in selling this plan will depend on whether they can make the case that raising the cost of energy here at home will somehow strengthen our security position around the world.

Of all the current and future components of the Senate cap-and-trade bill, no provision stands at greater odds with that imperative than an infrequently mentioned policy proposal known as the Low-Carbon Fuel Standard (LCFS). Added initially to the House's version of cap-and-trade, some in Congress are chafing for its inclusion in the Senate version expected to be debated later this fall. If successfully added, an LCFS would initiate a direct and systematic assault on the energy and economic security of this nation.

It doesn't take a four-star general to understand that America's security is strengthened in direct proportion to the amount of energy we're able to procure from secure, affordable sources. Unfortunately, over the past 25 years, the volume of energy we've been forced to import from foreign, often unstable sources has more than doubled -- a function of naturally declining production at home, and an unwillingness on the part of our elected leaders to unlock new areas for exploration so that the next generation of Americans has the same access and opportunity that was afforded to us.

Thankfully, as production volume in the United States has gradually declined over the past several decades, production potential for our allies in Canada has steadily risen. Today, more than 2.5 million barrels of Canadian energy crosses the U.S. border every 24 hours, much of it routed to grateful consumers in the Midwest, but a significant portion also making its way to the mid-Atlantic, Intermountain West, and even Texas.

An LCFS would effectively undo this important security and economic relationship, and worse, actually divert this secure Canadian energy to people and places around the world who don't live under the same stifling regime. A recent analysis compiled by the U.S. Department of Energy's top policy adviser suggests that China will be the chief recipient of this gift from Washington, claiming more than 2 million barrels a day of Canadian oil that, without an LCFS, would've been sent straight to the American public.

The Canadians, for their part, are beginning to read the writing on the wall as well, inking a deal with a state-owned Chinese oil giant last month in a not-so-thinly-veiled response to efforts by Congress to unilaterally ban their chief export from entering the United States.

Proponents of an LCFS note their preferred policy doesn't "explicitly" target Canadian crude. They're right. What it does do, however, is assign rankings to world crude sources that favor energy produced in the Middle East, Africa, and elsewhere -- on the grounds that this oil is "lighter" in form and thus "easier" to produce. Conversely, secure energy available to us in the United States -- and nearly all of the crude produced in Canada -- is deemed under an LCFS to be "heavy" and thus more difficult to get to market.

Unfortunately, our competitors in China will be more than happy to claim the resources we blithely leave behind. And once secured, they'll emit significantly more carbon in transporting, refining, and consuming those resources than Americans ever could or would. That doesn't sound very bright to me.

America's long-term economic and strategic security does not, contrary to popular view, depend on our nation cutting off all ties to regional energy partners and insisting upon complete independence from foreign sources of crude. Even Saudi Arabia imports a portion of its energy from abroad. But it does depend on our ability to finally and fundamentally reclaim our energy destiny, and once again put ourselves in a position to contract with producers of our own choosing -- not the choosing of our competitors and agitators overseas.

An LCFS, if passed, would erode our present situation even more than it currently is. And it would render our country, and those who both live in it and have spent their lives defending it, less secure as a result.
Rear Admiral [Ret.] James J. Carey is national chairman of the National Defense Committee (http://www.NationalDefenseCommittee.org) and former chairman of the U.S. Federal Maritime Commission. Contact him at (703) 971-3220.