On Energy, a Lesson for Texas From the 1970s

Unrest in the Middle East, rising oil prices and frustration with federal energy policy — for Texans of a certain age, today’s headlines must seem like déjà vu all over again. The current situation is far less severe than the aftermath of the 1973 Arab oil embargo. But the parallels are unmistakable. 

Back then, state officials railed against federal price controls for natural gas because they reduced the incentive to hunt for new supplies. Today, Texas policymakers rage at Washington for moving too slowly to approve leases for deepwater offshore drilling, and for imposing tight environmental controls that could hinder power plants and refineries.

Still, one lesson Texas could take from the 1970s is that what seems clever today may not remain so tomorrow. A classic example involves the trade-offs between coal and natural gas power. In the mid-’70s, convinced that gas supplies were running out, state regulators ordered electric utilities to reduce their use of the fuel. So they started burning coal instead.

Today, some state officials are urging the opposite. Lt. Gov. David Dewhurst has voiced support for phasing out the oldest coal plants and increasing natural gas power in their place. Far from running out, Texas’ gas supplies have expanded rapidly in recent years with better technology and the discovery of new shale formations. Coal is now vilified — outside of Texas, at least — as contributing to climate change, for emitting a number of pollutants, and environmentalists are eager to shut down ’70s-era coal plants, such as Luminant's Martin Lake coal plant (pictured), which began operating in 1977.

“We are a fickle people,” said Michael Webber, the associate director of the Center for International Energy and Environmental Policy at the University of Texas. Nationally, he said, a 1978 law barred utilities from building new gas power plants. The policy effectively aided coal but was rescinded in 1987.

The ’70s were also when Texas began building nuclear power plants, which went forward despite concerns about ballooning costs and waste storage. Those issues have added resonance today, with potential expansions at Texas’ two nuclear plants almost certainly on hold in the wake of the crisis in Japan.

Advocates of renewable energy also see the ’70s as a missed opportunity. Gov. Dolph Briscoe Jr. had called for a federal Manhattan Project to find an environmentally friendly and secure mix of fuel sources, which would include solar, geothermal and nuclear fusion.

Months before the 1973 embargo, he formed an energy advisory council chaired by his lieutenant governor, Bill Hobby, and the group ordered studies on a variety of fuels — including one on wind power in 1974 and another, in 1977, on a portfolio of options including solar, wind, biomass and even exotics like algae. Policymakers were aware that oil and gas production in Texas had peaked in 1972, according to the author of the 1977 report, Robert J. King, who still heads a clean-energy consulting firm in Austin.

The only alternative to succeed on a large scale, however, has been wind power, and most of the growth did not even occur until the past decade.

Energy conservation, a fact of life during the ’70s, has also largely been abandoned — although Texas today uses energy more efficiently than it did decades ago, meaning that the state’s economic output per unit of energy is far greater. 

In November 1973, just a month after the embargo began, Briscoe decried the “wasteful use of energy in every segment of our society.” He asked state agencies to use less fuel, buy small cars and set thermostats to 65 degrees in the winter. He had put a brigadier general, James M. Rose, in charge of the Energy Conservation Task Force, and Rose delivered regular updates on the falling electricity and natural gas usage at the Capitol building, even seeking to adjust the schedules of the building’s janitors so they would not waste light at night. 

In today’s environment, where eight-hour rolling blackouts in February sparked outrage, such pronouncements by a Texas politician would be politically unthinkable.