NCPA - National Center for Policy Analysis

Energy Abundance vs. the Poverty of Energy Literacy

June 26, 2012

For many decades, Americans have had the good fortune and innumerable economic, health and lifestyle benefits of using highly affordable energy.  While most Americans will remember periods where prices spiked, such price shocks have been relatively infrequent events, usually triggered by an outside cause, such as instability in the Middle East or unexpectedly rapid economic growth in China, says Kenneth P. Green, a resident scholar at the American Enterprise Institute.

This low-cost-energy blessing has not been an accident -- U.S. public policies have largely stayed out of the way, and shrewd American entrepreneurs have proven up to the task.

  • Unlike many other countries, U.S. taxation on energy has been reasonably low.
  • Further, while regulations have been significant, they have been offset by continued access to abundant and affordable energy.
  • Finally, Americans have benefited from a highly efficient private energy sector that discovers, produces and brings energy (both in liquid form and as electricity) to meet consumer demand.

This ease-of-use is not the case for the rest of the world, however.  Despite the relative age of basic energy technologies, hundreds of millions still lack access to electrical power, stripping them of substantial economic and health outcomes.

  • An estimated 79 percent of the people in the Third World -- the 50 poorest nations -- have no access to electricity.
  • The total number of individuals without electric power is put at about 1.5 billion, or a quarter of the world's population, concentrated mostly in Africa and southern Asia.
  • The situation is particularly acute in sub-Saharan Africa: in 11 countries, more than 90 percent of people go without electricity.
  • In six of these -- Burundi, Chad, Central African Republic, Liberia, Rwanda and Sierra Leone - only 3 to 5 percent of people can readily obtain electric power.

Highlighting this widespread lack of access should cause Americans to better appreciate their low-cost energy that is a crucial ingredient in so many facets of their lives.  Additionally, this energy is cleaner and less harmful than ever before.  This is true both in terms of human illnesses and in damage done to natural ecosystems.

Source: Kenneth P. Green, "Energy Abundance vs. the Poverty of Energy Literacy," The American, June 12, 2012.

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