Synthetic Fail

The checkered history of the previous much-hyped hope of alternative energy, synthetic fuels, is carefully investigated. The rendering of fuel from oil shale, liquefied coal, or other sources, while technologically feasible, remained a back-burner project for most of the twentieth century until the energy crisis of the 1970s. The creation of a quasi-federal entity, the Synthetic Fuels Corporation, was one of President Jimmy Carter’s signal achievements. But the SFC, which became an easy target for President Ronald Reagan’s budget cutters, was ultimately doomed by what had initially hastened its birth: fluctuations in energy prices. Cost-benefit analyses repeatedly revealed that costs outweighed potential benefits by orders of magnitude. However, actual losses were limited, because the projects tended to fail quickly, and these failures were blessings in disguise, as “potential expenditures were enormous.” Given the small number of projects that received SFC approval in the course of its approximately 2,000-day life, no one can say that the corporation was profligate, throwing taxpayers’ money at every energy-company mendicant that came along. It was just a failure.