The Tech: In Washington, nothing gets done unless it is put on the agenda. How will Senator McCain make energy a priority for his administration?
James Woolsey: The first requirement if you want it on the agenda in Washington is to have the president want it there. Unlike the Bush Administration, which has been opposed to a mandatory cap and trade system, one of the most important things you can do to move towards renewable energy [and away] from carbon emissions is a cap and trade system. … I think that will [be] at or very close to the top of his agenda … the stagnation we have seen on [the energy] issue in the Bush administration will certainly not be the case in a McCain administration. …
With respect to moving away from oil as the underlying fuel for transportation while still getting through the period for some more oil to limit the amount of imports … [McCain] would push hard on electric vehicles — particularly plug-in hybrids. That tax credit has now been passed by the congress in recent legislation.
He also has the prize effort to move forward very much like the way the Defense Advanced Research Projects Agency, DARPA, uses prizes to help create teams [and] move forward with new technology … and that technology [can] reduce the cost of batteries for plug-in hybrids in electric vehicles by some 70 percent down to around $300 a kWh battery pack.
Press Detroit to move far more rapidly than they are now to deploy flexible fuel vehicles to help create a market for alcohol based fuels, ethanol, methanol, butanol, all of which have possibilities. But [McCain] is opposed to steering the system towards any one of those which is corn based ethanol, but definitely supports the movement towards alcohol-based fuels as well as toward electricity. Those two together should begin to have a substantial effect on our need for using [and] our dominance for oil [for] transportation.
But as an interim measure, while we move away from oil … [we should use oil that is] domestically produced [rather] than foreign produced because our borrowings of hundreds of billions of dollars a year to import oil have been part of our financial difficulties with our balance of trade [and] value of the dollar …
TT: Going back to cap and trade, Senator Obama has said he would auction off the permits. If this is different from Senator McCain’s position, how would he initially allocate permits and what criteria would he use?
JW: He hasn’t come up with a precise formula yet, but he does believe that at the beginning when one wants to try to move into having a cap and trade system set up rapidly … it would ease the transition if at least some of the permits initially were provided by the government. But our expectation is that it would be a fairly small percentage of the overall permits. We will steadily move towards having more be auctioned …
TT: There was a lot of talk at the debate … on new cleaner technologies. Setting aside where the energy comes from, the fact of the matter is that Americans consume about 25 percent of the energy produced in the world. Is energy consumption behavior a concern? If so, how will Senator McCain address this issue?
JW: Yes, it is a big concern and he is a strong supporter of moving out promptly with encouragement to be more efficient in use, especially of electricity. He talks about some of the companies — Wal-Mart, Texas Instruments and others — that have done a very good job of this and believes that a mandatory cap and trade system will put a particular pressure on any form of energy that emits CO2.
[This particularly includes] coal and to a lesser extent, but some extent, to natural gas. That pressure will help us move towards energy efficiency and towards shifting energy sources … from carbon emitting sources to non-carbon emitting.
TT: One of the specific projects mentioned by the McCain campaign is the goal of building 45 nuclear plants by 2030. Does Senator McCain have a plan on how this will be financed? Currently, what is the best option for waste storage?
JW: Ultimately, they are going to be financed by the consumers of the electricity. … He wants to get started on a program of that sort because he believes that … some old coal fired power plants need to be replaced and some of the old nuclear plants need to be replaced, so he wants in place a program that is capable of adding base load power that is clean.
If you are looking for base load that can operate 24/7 and not emit CO2, you are going to rather quickly think one is going to have to have some new nuclear power plants. There may be a question of how many: If everything works well with respect to energy efficiency … you might not need as many as you would otherwise would.
That might be also affected if we rather rapidly develop a method of sequestering — not just capturing but sequestering — CO2 from coal fired power plants. That might open up utilization of coal … These things can all interact. The solid reality [is] that we know how to produce nuclear power plants and we’ve done it before and done it successfully and it doesn’t emit CO2 and can operate 24/7. Those things together are what have pushed [McCain] to believe that we should move out promptly with a program on nuclear power plants.
TT: With your background in the CIA, you have been able to shape the energy debate into one of national security. Is this the only way to sell it to the American people? How will Senator McCain convince the American people in investing in plug-in hybrids and renewable energy technologies?
JW: There are all sorts of reasons to want to move towards renewable energy and away from oil dependence. There’s national security that applies to making the grid a lot more resilient as well as moving away from oil and a possibility of cutoffs in the Middle East.
There is also of course climate change, which [McCain] cares deeply about and along with Joe Lieberman was the first introducer of … a mandatory cap and trade system in the Congress … right around the beginning of this decade. Then there are people — there are large numbers of evangelical groups — that believe that one is not taking good care of the Earth if one pollutes it with huge amounts of CO2 and there are people who just want to drive more cheaply.
I drive in my plug-in hybrid at a cost for 20 miles, the first 20 miles a day are about two cents a mile where gasoline is 15 cents a mile. So you can be interested in moving away from oil simply because electricity is cheaper. Any of these reasons are fine; we have to have a coalition of people who are interested in these steps for all sorts of different reasons. …
I mean you got all kinds of folks that are interested in moving in this direction and each for their own reasons and the bigger you make the tent in terms of people with different objectives … they still … come together wanting to move away from fossil fuels and away from oil for transportation. That’s fine, that’s great, that’s how you get substantial amount of support is by being open to a wide range of people.
TT: How will Senator McCain engage developing countries such as India and China in reducing carbon emission, balancing development and environmental/energy concerns?
JW: … China is a very hard case because it does not have a rule of law, but it is a huge emitter of CO2 and it may be that initially, one would want to work with China on the basis of offsets and bring China into the system by having verifiable offsets.
For example, if a Chinese official says they are going to plant a million hectares of trees — that can be verified from afar from aircraft or even from satellites. But there are [some cases where a] Chinese official might say I was going to do x but now I’ll do y. If you just send money … you really don’t want that to be part of the system because people will understandably lose confidence in the system [if] it is based on a claim … from a country that doesn’t operate under the rule of law.
So I think one wants to move as quickly as possible to bring … the international cap and trade regime [to] countries that operate under the rule of law, particularly any [countries] like India that emit a lot of CO2 and then use offsets perhaps in other countries. …
[We should also move toward] developing technology that is more attractive than technology that emits carbon or … if we can get photovoltaic cells to have substantially higher efficiencies than they have now we may be able to make some of these renewables … a lot more attractive both in carbon emissions terms and terms of cost then they are today.
So the creativity of American society and the fact that bright graduates of MIT are now starting photovoltaic companies and battery companies — whereas few years ago that would not have been the case — is a very positive sign.
I think the best way to bring China and other emitting countries into the common effort is to invent and develop the technology that is more attractive for all reasons … or they are headed towards more coal fired plants.