By Bracken Hendricks and Ana Unruh Cohen
Special to washingtonpost.com
Wednesday, May 24, 2006 12:00 AM

With average gas prices creeping toward $3.00 a gallon and oil hovering at $70 a barrel, our dependence on oil has been at the top of the news, becoming a defining political issue and a looming source of voter discontent. The United States imports well over half of the oil we use, spending a staggering $175.6 billion on imports last year -- driving up the trade deficit and emboldening unfriendly regimes awash in petrodollars. We consume a quarter of global oil but possess less than 3% of reserves, leaving few options other than increasing imports unless we enact policies that reduce our reliance on oil.

But the challenges of oil are not limited to gasoline prices or imports: They are truly global in nature. In much of the developing world, reliance on oil has been devastating. The International Energy Agency estimates that for every $10 hike in the cost of a barrel of crude, the economy of an oil importing country in sub-Saharan Africa is impacted more than ten times as much as the United States. Furthermore, gains from debt forgiveness are being wiped out by rising energy costs. For example, Ethiopia has spent the equivalent of its entire debt write-off, or $1.3 billion, importing fuel over the last three years. The environmental impacts of oil are perhaps the most frightening of all. Each gallon of gasoline burned produces about 20 pounds of the greenhouse gas carbon dioxide, adding to an atmospheric concentration that is already higher than it has been in the last 650,000 years and increasing the risks of climate destablization.

In the face of all these problems -- what President Bush has called an "addiction to oil" -- America faces a major test. Will we embrace policies designed to prolong our reliance on oil, simply seeking to drive down prices and extend supplies, or will we pair solutions to oil security with answers to climate change? Not all oil security solutions are created equal when examined through the lens of climate security. As the nation decides on how to kick the oil habit, policies must be adopted that reduce oil consumption (PDF) and decrease greenhouse gas emissions. This must become the dual measure of our success.

Until lately, energy legislation rarely aspired to meet this higher standard, but recent developments may indicate a turning point. Two weeks ago, House Democrats unveiled a crash program to transition America to bio-fuels like bio-diesel and E-85, an 85% blend of ethanol and gasoline, and to empower farmers in a future carbon market. Last Wednesday Senate Democrats unveiled a plan to move toward energy independence by 2020. The Senate plan is comprehensive in its scope. It catches many of the good ideas that were orphaned in recent years under this administration's focus on expanding oil supply and consumption, and it rolls back the tax breaks and giveaways to the oil companies of last summer's energy bill. But perhaps most importantly of all, it explicitly links a comprehensive domestic energy policy with measures that track carbon emissions and their impact on the global climate.

These are promising starts, but bigger and bolder ideas are needed to meet the challenges of oil at home and abroad.

Farm-based renewable energy, and in particular biobased fuels, have the capacity today to deliver a secure and stable supply of fuel, provide support for farmers, create long-term jobs for rural communities, and make tangible reductions in greenhouse gas emissions. American farmers are struggling to compete in today's global marketplace, while an uneven international playing field in agriculture keeps millions of small-scale producers in the developing world mired in poverty. Farmers around the world share a common goal and a mutual frustration: the inability of the global trading system to deliver a fair market price for their products.

In Growing the World's Energy Future, the Center for American Progress has proposed a plan to increase domestic farm revenues from energy that would reverberate through the global economy in mutually beneficial ways. Our energy program would boost our national security by reducing oil imports and by linking U.S. agricultural competitiveness to the alleviation of poverty and despair abroad -- two key elements in the appeal of terrorism in the developing world.

Many studies show that to preserve U.S. manufacturing jobs we must rapidly convert our auto industry to produce more energy efficient vehicles. One piece of the solution is a bill called "Health Care for Hybrids." The Center has looked at legacy health care cost relief as an incentive for investments in retooling U.S. plants to produce more efficient cars and guaranteed fuel savings.

Another innovative strategy for moving off oil and rapidly driving new technology to market is proposed by Center Distinguished Fellow and former Senate Democratic Leader Tom Daschle and Sun Microsystems founder Vinod Khosla. They have offered a new idea for calculating fuel economy using a new Carbon Alternative Fuel Equivalent standard (subscription required). This measure would guarantee that cars that can run on ethanol actually use the fuel to displace gasoline, ensuring real reductions in oil consumption. In fact, combining 85% ethanol fuel with plug-in electric drive trains can achieve effective fuel economies of hundreds of miles for every gallon of gasoline.

As long as we focus solely on oil, new solutions like mining the tar sands of Alberta will seem like viable answers to our energy problems, however disastrous they are to the climate. By linking oil security and climate security, we can unleash real innovation. The tide of political will is turning. It is time to demand real leadership and serious investment. Time is short, and America is ready for a change.

Bracken Hendricks is a Senior Fellow at the Center for American Progress.  Ana Unruh Cohen is the Director for Environmental Policy at the Center for American Progress.