Originally published in Petroleum Industy Review.
If American energy security policy has a lesson for Romania, it's that sometimes you can wind up on the right road by luck.
For decades, the United States has used more energy per capita than most nations. But the 1970s' oil crisis taught the country a fundamental lesson: modern economies depend on reliable – and relatively cheap – sources of energy. Since then, that realization has been a critical lens through which to view American foreign policy.
But those who sat in hours-long gasoline queues grew older, and many Americans forgot the lesson. The 1980s and 90s saw tremendous growth in US energy demand, the economy hummed, and dependence on foreign oil increased, as Americans in their millions bought ever larger, gasolineguzzling SUVs.
Flash forward to September 11th and the 2008 global economic recession. The latter coincided with a dramatic advance in natural gas and oil extraction: hydraulic fracturing. While Americans were hunkering down, a quiet engineering revolution was going on across the country.
Petroleum engineers had learned how to turn their vertical drills horizontal, exposing wide sections of shale and other "tight" rock formations, laid down millennia ago, to high pressure fluids that broke them up, releasing natural gas and other hydrocarbons. American natural gas exports rose a staggering 68% - from 27.3 billion cubic meters in 2008 to 45.8 billion cubic meters in 2012 – with natural gas now poised to replace coal as the major fuel source for domestic electricity generation. Not coincidentally, this increase coincided with a drop in US greenhouse gas emissions over the same time period.
With the US Environmental Protection Agency announcing Clean Air Act carbon regulations in September that are likely to impose strict requirements on coal-fired electricity plants – and the federal government's almost simultaneous approval of a fifth new liquefied natural gas – the pace of US natural gas exploration and production is set to quicken.
Natural gas has played a significant role in reducing US emissions of greenhouse gases – when burned to produce electricity, methane produces about half the CO2 emissions of coal – and its dependence on foreign sources of energy. Federal air regulations on natural gas extraction and production facilities will require capture or flaring of gas at the time of well completion, ensuring that methane is not released directly to the atmosphere, where it is a far more potent greenhouse gas than CO2.
At the same time, the US is increasing fuel efficiency standards for automobiles and raising the minimum volumes of renewables that must be included in transportation fuels. In fact, just this summer, the US Environmental Protection Agency announced a plan to include green electricity among the renewable fuels eligible for credit under the federal program.
More by default than design, the US has thus arrived at what President Obama calls an "all-ofthe- above" approach to energy security, with increasing reliance on diverse, domestic fuel sources, energy efficiency and conservation and renewables. And recent polls show that 87% of the American public now views development of clean energy sources as a public policy priority.
The 1989 fall of communism led to a precipitous decline in Romania's energy consumption and production in the early 1990s. But from an energy security perspective, Romania now begins from a fortunate starting point. Its per capita energy use in 2010 was just 1.9 tonnes of oil equivalent (TOe), compared with 7.3 TOe for the US, and policy analysts project Romania's energy use to rise just 10% to 2.1 TOe by 2015.
Like the US, Romania also possesses abundant energy resources. Owing largely to hydroelectric power, Romania is on track to meet the European Union's goal of deriving 24% of its power from renewable resources.
While the country remains an importer of petroleum and natural gas, Romania sits atop and adjacent to significant tight rock hydrocarbon reserves. The first exploration wells have already been drilled, and as long as the government maintains vigilant regulatory oversight over hydraulic fracturing, Romanians may reasonably expect to become net exporters of natural gas, breaking the country's long dependence on Gazprom.
While America's shale gas revolution may seem idyllic to some, Romania has an opportunity to modify that model to better suit its starting conditions. Unlike the US, Romania's per capita energy consumption is relatively modest, so the country can afford to take time to develop the resource in a consistent way, while advancing other renewable fuel sources in addition to hydroelectric power.
Climate change must remain part of the energy security equation for Romania and the rest of the world. Fortunately, wind power and anaerobic manure digestion, among other alternative energy sources, hold great promise for Romania – and may allow it to reach the EU goal set for renewables by 2020.
From an energy security perspective, then, Romania is wellpositioned for the 21st century with diversified, domestic energy resources, a mindfulness of the importance of climate change, a motivated and well educated population and a strong manufacturing base.
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