Tuesday, June 24, 2008

New England heading for economic "catastrophe."

The former governor of Maine lays it on the line.

The Ellsworth American
“Catastrophe” Awaits Maine: Angus King
New Energy Sources Urgently Needed
Written by Tom Walsh
Thursday, June 19, 2008

That’s the word not from Chicken Little, but from former Maine Governor Angus King, who says he doesn’t use the term “catastrophe” lightly.

“This is a human catastrophe coming at us in the state of Maine in terms of energy supply and costs,” King said last week at a daylong seminar on harnessing tidal energy and offshore wind to confront runaway energy costs, costs he sees as a direct threat to Maine being habitable.

“This winter, the cost of fuel oil is going to more than double,” he said. “What’s being quoted now is $4.96 — $5 a gallon. That’s $1,000 to fill up your tank in the basement one time, and most people are going to have to fill up their tank six times.

“How is somebody who is making $350 or $400 a week going to pay to fill up the tank to keep warm? How are they going to pay to fill up the truck to get to work? This is, I think, the most serious crisis to ever face the state of Maine.”

...“Eighty percent of homes in Maine are heated with oil,” he said. “The national average is 9 percent. If you do the math, 87 percent of the total energy bill of the average Maine person is dependent on oil or natural gas, and that is a particularly serious problem.”

King notes that oil prices have more than tripled in the last 10 years. Only six months ago, he said, the price of oil was $75 a barrel. Last week it was $114.

“A non-hysterical prediction is that, by 2020, oil will be $300 a barrel, which means $10 a gallon for gasoline, which means $10 a gallon fuel oil. It means filling up the tank in your car will be $200, with incomes not that different. It means $2,000 to fill the oil tank in the basement.

“Here’s the catastrophe part,” he said at Bowdoin College. “In 1998, energy — all energy: cars, home heating and electricity — was 4 percent of the average Maine family’s budget. Today it’s 20 percent. It went from 4 percent to 20 percent in 10 years. That’s pain.”

Should oil hit $300 a barrel, King said, that percentage would increase from 20 percent to as much as 50 percent of the average family budget.

“We go from pain to lethal,” he said. “We simply can’t survive that...

...“Fifty percent of your budget for energy and 20 percent for health care leaves 30 percent for everything else: mortgage, rent, food. It’s just absolutely unsustainable.”

King predicted in Northport that $300 oil would see families pulling up stakes and dramatically changing how they live.

“The old thing we heard was people choosing between medicine and food,” he said. “People are going to be choosing between heat and food. People are going to be living together. People are going to be moving in to have five or 10 people in an apartment to deal with this problem.

“This is a really urgent problem, and I don’t think the world has come to grips with how serious.”

Doing nothing is not an option, King said. That’s what created what he sees as an unsustainable status quo.

This is the part people are having trouble with - seriously sitting down and looking at their budget and planning what they will do when gasoline, diesel, heating oil and natural gas are basically unaffordable.

Ignore it all you want, but it won't go away, class.

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