This past year, mostly for business but
also for leisure, I spent a lot of time
traveling. I traveled to three continents and visited more than 12 countries.
While each place had its own culture,
character and unique flavor, there was
one thread that ran through them all – a
commonality that made striking up a conversation with complete strangers as easy
as talking to my best childhood friend.
That common element was the soaring
cost of oil and the rising price of gas.
Reading the local newspapers almost
made me feel like I had never left home.
It’s interesting how the current oil
crisis gives new credence to that old saying
“what’s old is new again.” It wasn’t long
ago that the world faced very similar
challenges. The 1973 OPEC oil embargo
threw the world economy into a tailspin.
Though not as dramatically as today, U.S.
gasoline prices rose from 39 cents a gallon
to 55 cents a gallon in less than a year,
while the New York Stock Exchange lost
$97 billion in value in less than six weeks.
However, there appeared to be a silver
lining in the cloud.
President Richard Nixon announced
Project Independence in November 1973
with a goal of achieving energy independence by 1980. Conservation, he claimed,
coupled with the development of alternative
energy sources would free America from
its dependence on imported oil. Though
some important initiatives did emerge from
Project Independence – such as lower high-
way speeds, some mass transit development,
the conversion of oil power plants to coal
and the completion of the Trans-Alaska
Pipeline – the final assessment of the pro-
gram was best summarized by the current
president, George W. Bush, when he
noted that we have an addiction to oil.
While the 1973 oil crisis spawned the
age of more fuel-efficient automobiles
and the introduction of the compact-sized
car and the hatchback, everybody reverted
to business as usual as soon as relations
with Gulf oil-producing countries were
normalized. Within a decade, the hatch-
back gave way to the van, which was
overtaken by the SUV and finally the
Hummer. We had learned nothing.
Sixty-six years ago, economist Joseph
Schumpeter spoke of ‘creative destruction’
as the process through which new, cre-
ative companies unseated established
ones. He suggested that it isn’t competi-
tion that brings down business giants but
rather their reluctance to adapt to new
ideas and their inability to understand or
capitalize on new combinations. He noted
that many incumbent companies dismiss
or even try to discredit new ideas while
committing to existing products and pro-
cedures. However, the few companies that
survive periods of creative destruction are
those that display foresight, invest in and
form new partnerships and experiment
with new untested markets.
of us, for others, cause and effect are still
a matter of debate. Respecting all mem-
bers’ right to disagree, like the common
thread that bound the people I ran across
in Europe this past summer, I think we can
all agree that dependence on foreign oil
must be reduced at all costs. We have to
beat our addiction! To do that, we have to
heed the advice of Joseph Schumpeter
and embrace this period of creative
destruction. Unlike the last time, however,
change must come from the bottom up.
The one constant that survived the last
oil crisis and will emerge even stronger
after this one is district energy. Our chal-
lenge is to assume a leadership role and
show not only our government, but also
the public at large, that we can achieve
what President Nixon tried to do 30 years
ago. Under Rob Thornton’s leadership and
with the support of many of our mem-
bers, we have made significant gains in
Washington, D.C. But what’s even more
exciting from the perspective of creative
destruction are initiatives like solar district
heating in Europe or seawater cooling in
Our challenge is to assume a
leadership role and show not
only our government, but also
the public at large, that we can
achieve what President Nixon
tried to do 30 years ago.
Like you, I look forward to a fuller
discussion of these projects at our next
gathering, and I hope for their success.
…it isn’t competition that brings
down business giants but rather
their reluctance to adapt to
new ideas and their inability
to understand or capitalize on
President and CEO, Enwave Energy Corp.
At IDEA’s annual conference in Orlando,
there was some debate about global warming. While it is a self-evident truth for some
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