President Obama addressed the nation on the BP oil spill and energy issues from behind his desk in the Oval Office on Tuesday night. (image: Doug Mills/The New York Times)

President Obama made a sixteen-minute speech from the Oval Office on Tuesday night that addressed the still-gushing oil leak in the Gulf of Mexico and the government’s response to the disaster (watch the full speech here and read the transcript here). The President reiterated his administration’s commitment to stopping the leak and cleaning up the oil that’s drifting toward (and has already arrived at) coastal communities: “We will fight this spill with everything we’ve got for as long as it takes.” But he offered few details of what that would entail and how much it would cost. He also assured Americans that “We will make BP pay for the damage their company has caused” and described the creation of an independently administered trust to dole out payments, but did not address the issue of the existing cap on BP’s economic liability for the damage. The speech offered very little in specific action plans, which earned some unfavorable reviews from pundits and policymakers.

The speech also included a call to action to help change the direction of America’s energy future—away from fossil fuels and toward domestically produced green fuels and other renewable energy sources. Obama repeated previous statements touting the economic benefits of a full-fledged push toward green energy:

As we recover from this recession, the transition to clean energy has the potential to grow our economy and create millions of jobs—but only if we accelerate that transition.

Like his remarks on the oil spill, however, Obama did not enumerate steps that would be taken to perform the acceleration. Though he did endorse the Waxman-Markey climate bill passed by the House of Representatives last year, calling it a “a strong and comprehensive energy and climate bill,” he did not urge the Senate to make debate and passage of the bill a higher priority.

Obama’s speech again reinforced his support for reducing US dependence on petroleum products through energy efficiency and new energy technology. He did not directly address the issue of carbon dioxide emissions, which many believe must be curbed through legislation in order to cut America’s fossil fuel “addiction.” Cap and trade and other proposals aimed at lowering emissions of carbon and greenhouse gases in general would have a direct effect on gasoline and heating oil prices. Obama’s speech did little to help or hinder the chances of the Waxman-Markey bill or any other climate and energy bill through Congress, so don’t expect your energy prices to change any time soon.

As oil continues to gush into the waters of the Gulf of Mexico, the fight over putting a price on carbon emissions and the burning of fossil fuels rages on. When and how measures to curb emissions might be implemented is no clearer now than it was before the President’s speech. The best advice for heating oil users and all other Americans is to invest in energy efficiency as soon as possible to guarantee energy savings no matter which directions the political winds are blowing.

President Obama tours the POET biorefinery in Macon, MO. (image: nytimes.com)

President Barack Obama visited the POET biorefinery in Macon, MO on Wednesday to emphasize his commitment to making biofuels a key component of America’s future energy mix, and make the US “first when it comes to biodiesel and the technologies that are being developed in places like POET.” In his speech, Obama hailed biofuels’ advantages as a clean, renewable, and domestic energy source that could create jobs and lead to energy independence.

As the Kansas City Star reported, Obama focused as much on economic recovery as he did on environment and energy. He pledged to follow through on the plan laid out by the Renewable Fuels Standard, which calls for US production of biofuels to triple by 2022, and said, “There shouldn’t be any doubt that renewable, homegrown fuels are a key part of our strategy for a clean energy future.”

In his remarks (full text available at the White House website),Obama made it clear that the development of biofuels was just one part of a broader strategy to create jobs and develop clean, domestic energy:

We began early last year by making the largest investment in clean energy in our nation’s history. It’s an investment that we expect will create or save up to 700,000 jobs across America by the end of 2012—jobs manufacturing next-generation batteries for next-generation vehicles; jobs upgrading a smarter, stronger power grid; jobs doubling the capacity to generate renewable energy from sources like sun and wind and biofuels, just like you do here.

POET produces more than one quarter of the country’s ethanol each year, and is a leader in cellulosic ethanol, which uses the non-edible parts of plants such as corn cobs. Even though Obama toured an ethanol biorefinery and made his remarks while a front-end loader filled with corn stood next to him, the president was intent on endorsing biofuels in general, not just ethanol (to the dismay of ethanol advocates). The ethanol industry may have wished that Obama had offered more specific support for the corn-based fuel, but his inclusive endorsement of all biofuels could be good news for heating oil users.

While gasoline is blended with ethanol, home heating oil is blended with biodiesel, which can be produced from a wide variety of feedstocks. If the government backs the production of biodiesel from algae, waste cooking oil, or other sources—and not just ethanol production—heating oil users are more likely to have access to a clean and affordable heating fuel.

Watch the full video of President Obama’s remarks at the POET biorefinery below.

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President Obama speaking at New York’s Cooper Union on Thursday. (image: Reuters via wsj.com)

In a speech at Cooper Union in downtown New York on Thursday, President Obama briefly touched on petroleum-dependent businesses’ participation in financial markets. In the middle portion of a speech calling for comprehensive reform to protect Americans against reckless activity on Wall Street, Obama used businesses hedging oil prices to moderate costs as example of fair and honest use of commodities markets:

So I want to reiterate: there is a legitimate role for these financial instruments in our economy. They help allay risk and spur investment. And there are a great many companies that use these instruments to that end—managing exposure to fluctuating prices, currencies, and markets. A business might hedge against rising oil prices, for example, by buying a financial product to secure stable fuel costs. That’s how markets are supposed to work. The problem is, these markets operated in the shadows of our economy, invisible to regulators and to the public. Reckless practices were rampant. Risks accrued until they threatened our entire financial system.

End users of petroleum products, as hedgers, serve as the counterparts to speculators, who have no interest in the physical products and trade futures or options contracts in pursuit of financial gain. Heating oil dealers often act as hedgers to protect themselves from unpredictable swings in heating oil prices. Obama’s comments allude to speculators using oil (and other commodities) as part of opaque investment activities that contributed to the financial collapse of 2008.

Watch the full speech on the Fox News website. The reference to oil hedging begins at the 13:54 mark.

Rumney Memorial School principal Adam Rosen (shown reading to third- and fourth-graders) discovered the benefits of energy audits and weatherization first hand. (image: rumney.org)

From President Obama to Secretary of Energy Steven Chu, many high-profile individuals and institutions have recently touted the energy-saving benefits of weatherization. The simple and inexpensive process of sealing up a house or other structure to ensure it stays warm in the winter and cool in the summer, if done correctly, can seriously reduce energy use and provide huge cost savings just a year after weatherization improvements are made. But should we take politicians’ and bureaucrats’ word on this issue? What do ordinary Americans have to say about weatherization?

To find out, one need look no further than an opinion piece published Tuesday on the Vermont news blog vtdigger.org. Under the straightforward headline “Rumney School used half as much fuel this year because of weatherization,” Principal Adam Rosen of Rumney Memorial School in Middlesex, VT described how a two-day weatherization project at the school led directly to huge savings on heating oil.

Last summer, the elementary school received a grant from the state’s Department of Natural Resources and began the weatherization process. The first step was an energy audit in which technicians examined the school building and identified the best ways to maximize its energy efficiency. Next, “with help from over a dozen hard working local volunteers, in two long days,” energy technicians installed attic insulation and sealed air leaks throughout the building to ensure that temperature-controlled air would stay inside the building and outside air wouldn’t get in.

Finally, the school (without the aid of a grant from the state government) invested in a comprehensive cleaning and tune-up of its oil-fired boiler and heating system: “[HVAC technicians] made suggestions beyond the routine annual boiler cleaning. We repaired thermostats and cleaned the dust off our radiator fins.”

Nine months later, the result of Rumney School’s investments couldn’t be more positive, as Rosen explained:

I had us bid on 6,500 gallons of home heating oil. Well, if we’d had a bone-chilling cold winter, we might have needed that much—as it was, we purchased less than 4,900 gallons of oil, and are going into the spring with a nearly 3,200 gallons in the 5,000 gallon tank. Air-sealing, followed by insulating and boiler maintenance paid off and the school benefited beyond any of our expectations: this year at Rumney Memorial School we used a little more than half the fuel that we used in previous years!

A school that had previously purchased 10,000 gallons of heating oil for one heating season bought just 4,900 gallons and has several thousand gallons left over for next year.

The lesson for heating oil users (and users of other heating fuels as well) is clear: weatherization works! Investing a few hundred dollars in a professional energy audit and appropriate improvements will save you thousands if not tens of thousands of dollars on heating and cooling bills over the future years and decades you spend in your home. Even if you move out of your energy-efficient home, the improvements you invested in will raise its market value. Plus, federal and state grants, incentives and tax breaks can help reduce up-front investment in audits and home improvements to increase savings even more. And let’s not forget the environmental benefits of home energy efficiency; using less energy means decreased consumption of fossil fuels and fewer greenhouse gas emissions.

Energy audits, insulation upgrades, and well-placed caulking are deceptive in their simplicity, but have proven to be astoundingly good investments for those who do them right. So if you’re looking to save some money on your heating oil and electricity bills, the time to invest in a professional energy audit and home energy improvements is now. Given the chance, President Obama, Secretary Chu, and Principal Rosen would all give you a hearty pat on the back for your decision.

"The future of US energy is heating oil," said Pres. Obama to a rapt audience on the grounds of a NJ heating oil storage facility. (image: Nicholas Whitaker via heatingoil.com)

After yesterday’s announcement that the US would expand offshore oil drilling, President Barack Obama dropped another bombshell on the energy world by calling heating oil “the key to America’s future” and pledging to bring heating oil to 10 million more American homes by 2014. To demonstrate his determination on this score, Pres. Obama will be converting the White House to a heating oil system, and dug up the Rose Garden to install a brand-new, 1,000-gallon home heating oil tank. President Obama announced his ambitious plan at a heating oil storage facility in Landon, New Jersey.

As crowds cheered, the President explained the importance of heating oil:

We cannot afford to delay one more day in bringing the citizens of this country the safe, reliable, and affordable heating fuel they deserve. For too long this advance has been held up the partisan squabbles of the past—the time has come to move forward. Heating oil’s high efficiency, low emissions that are getting lower each year, and clear path to 100 percent renewable biodiesel content make it the finest heating fuel in the land. All of America deserves this fuel. We’re starting at the White House, but we’re on our way to your house!

The announcement provoked some flutter in the financial press, as journalists struggled to piece together how heating oil, a close cousin of “oil” oil, was producing so much activity on the trading floor, outperforming metals, gasoline, and crude. Searching for an industry expert willing to explain the frenzy, Bloomberg news could only find the Maine Governor’s Office of Energy Independence and Security:

In Maine, the President’s comments have created a phenomenon. Following the president’s announcement, our office has been flooded with calls from Mainers eager to switch to heating oil for their home heating needs. The excitement has unfortunately led to some unlawful activity in southern Maine, where a band of heating oil marauders is performing involuntary repairs on tanker trucks carrying diesel fuel, flooding the local market with supplies of no.2 oil.

President Obama’s announcement came as surprise to many Americans—especially residents of the West coast and South. Puzzled viewers of the president’s speech in those regions turned to the internet to find out what heating oil is, making “what is heating oil?” the most-searched phrase on Google’s US search engine.

The craze swept the nation in record time, with some citizens driven by their enthusiasm to begin clearing space in their basements and garages on Thursday afternoon to make room for a new heating oil tank.

Following his prepared remarks, the president took questions from the press, and offered some details of how his program, dubbed “Making America Cozier with Oil Heat.” Private citizens will be rewarded with rebates worth 40 percent of the cost of their new oil heat system, including tank and furnace or boiler. New users of heating oil will also receive their first fill-up of the fuel for free, thanks to a cooperative subsidy program administered through the Department of Energy and local state oil dealer associations.

Reached for comment on Air Force One after his speech, the president told HeatingOil.com, “I’m fired up to get more people on board with this great fuel, and I’ll need your help to do it. Keep the good work, and spread the word!”

President Obama gives a speech on energy security at Andrews Air Force Base on Wednesday. (image: nytimes.com)

In a speech delivered at Andrews Air Force Base in Maryland, President Obama announced that the Interior Department would lift bans on oil and natural gas drilling off the coast of the southeastern US and parts of Alaska. Along with the announcement, Obama made a clear effort to cast his decision as a middle road between unchecked drilling and a blanket ban on drilling expansion. Details of the policy reported on Wednesday by the New York Times support this characterization: vast areas of the Atlantic ocean, a section of the Gulf of Mexico, and select areas off the coast of Alaska will be opened, while waters along the entire Pacific US coast and other Alaskan coastal regions will remain off-limits.

In his speech, Obama referred to the compromise decision as a product of careful deliberation on America’s energy security and future energy resources. As such, he tied expanded drilling to an increase in renewable energy use, saying that both resource categories were required to meet US energy needs. “We have less than 2 percent of the world’s oil reserves. We consume more than 20 percent of the world’s oil,” he explained. “And that means drilling alone cannot come close to meeting our long-term energy needs.”

A White House press release offered a more general statement from the President on that subject:

I want to emphasize that this announcement is part of a broader strategy that will move us from an economy that runs on fossil fuels and foreign oil to one that relies on homegrown fuels and clean energy. And the only way this transition will succeed is if it strengthens our economy in the short term and the long term. To fail to recognize this reality would be a mistake.

As proof of this broad and balanced approach, Obama made two announcements on the energy efficiency of vehicles along with the allowance of expanded drilling. In just a few days, he said, the White House would unveil higher fuel efficiency standards for vehicles sold in the US that would amount to saving “1.8 billion barrels of oil.” In addition, the president announced that the federal government would “lead by example” and vastly expand its use of hybrid vehicles:

In order to save energy and taxpayer dollars, my administration—led by Secretary Chu at Energy, as well as Administrator Johnson at GSA—is doubling the number of hybrid vehicles in the federal fleet, even as we seek to reduce the number of cars and trucks used by our government overall.

The Navy’s energy security logo on the F18 fighter jet scheduled to be “the first plane ever to fly faster than the speed of sound on a fuel mix that is half biomass.” (image: navy.mil)

After he emphasized the “sensible” and middle-of-the road nature of the new energy policies, Obama drove home his view of why it is important. He touched on the issues of energy independence and efficiency in the context of national security. He lauded the US Armed Forces for their leadership in energy efficiency, citing huge investments in efficiency measures this year, and pointed to an Air Force F18 fighter jet parked behind him.

This navy fighter jet, appropriately called the Green Hornet, will be flown for the first time in just a few days, on Earth Day. If tests go as planned, it will be the first plane ever to fly faster than the speed of sound on a fuel mix that is half biomass.

As is expected in all major political statements in our current economic climate, Obama peppered his speech with references to energy initiatives creating jobs and growing the national economy. He began his remarks by congratulating his administration on making the “largest investment in clean energy in our nation’s history,” and said the investment was “expected to create or save more than 700,000 jobs across America.” He repeated previous statements that a robust green energy industry in the US is crucial to America’s economic recovery.

Finally, Obama used his administration’s moderate approach to the issue to urge Congress to act on energy reform. He closed his speech with a broad call to action:

I think that we can break out of the broken politics of the past when it comes to our energy policy. I know that we can come together to pass comprehensive energy and climate legislation that’s going to foster new energy—new industries, create millions of new jobs, protect our planet, and help us become more energy independent. That’s what we can do. That is what we must do. And I’m confident that is what we will do.

For American consumers, the new drilling policies will not change much, at least at first. The allowance of drilling in new areas does not mean drilling will begin in the next few years, if at all. According to analysis from the Times, “Much of the oil and gas may not be recoverable at current prices and may be prohibitively expensive even if oil prices spike as they did in the summer of 2008.” The new policy gives oil and natural gas companies the option of drilling in a wider swath of territory, but offers no incentives to begin drilling activity. The lower prices and increased domestic production claimed by drilling supporters, which have been contested by many sources, including the Department of Energy, would not be realized for at least five years, and probably more.

The stricter vehicle efficiency standards will deliver cost savings to American drivers by requiring them to buy less fuel. As Obama put it, “new standards…will reduce our dependence on oil while helping folks spend a little less at the pump.” However, these requirements will only apply to new vehicles and probably won’t go into effect for a few years, so it will only be the new car owners of tomorrow that will see the benefits of higher fuel efficiency mandates.