HOUSTON -- Windmill blades could be seen on a loading dock at one of the nation's busiest ports during a recent visit to the offices of the Port of Houston Authority to discuss major petrochemical investments coming their way.
The blades weren't entering the port, the staff explained, but rather leaving it. Though the details were fuzzy, the explanation was that a canceled wind energy project in central Texas was reselling them to another buyer, perhaps in Latin America.
This scene more or less epitomizes the past six-year swing in the future outlook of energy in the United States: renewable wind power headed out as oil- and natural-gas-fueled development moved in.
Energy historians by and large agree that the U.S. is in the midst of dramatic transition, one starkly different from the direction the nation was believed to be on just six years ago.
From record high oil prices, the start of the Great Recession and the election of President Obama, most visions posited a postindustrial renewal, a new information economy powered by solar, wind and other clean energy sources. Billions in public funds was spent to encourage this clean energy revolution, while much of the nation looked to California as the model for the future, a state that was deemed much further along the curve than the rest. Public interest in solar power and electric vehicles rose; investment followed.
Just six years later, things couldn't be more different.
Natural gas and oil once again dominate the picture, while wind is starting to find itself on shaky ground. Investments in heavy industrial manufacturing -- steel, pipes, oil field equipment and petrochemicals -- are rapidly becoming the new reality and main source of employment growth. Schools are increasingly focused on training the next generation of employees for the dirty fossil fuels industry, while many policymakers point to Texas as the model others should follow.
Bernard Weinstein, a professor and energy business expert at Southern Methodist University, said he can't recall any other time in the nation's past when a similar 180-degree shift has occurred. The reason, he said, is that those sky-high oil and natural gas prices people feared so much back in 2008 spurred a revolution the likes of which has never been seen before.
"After the bust in energy prices in the late '80s, we kind of thought that the party was over. Then five, six years ago we started perfecting these new drilling technologies, and we've just seen an incredible increase; in Texas alone we've seen a 100 percent increase in oil production in the last five years," Weinstein said. "This would have been considered science fiction a half-dozen years ago."
Weinstein said the breadth and speed of change that the oil and gas industry has experienced -- and its impact on the nation -- has surprised even him. He was at a loss to point to any period in U.S. history that looks somewhat similar to what's happening now.
"The contribution of oil and gas to [gross domestic product] growth has doubled not over the past decade, but over the past four years," he noted. "And if you look at job growth in the oil and gas sector ... let's put it this way, since the Great Recession began in 2008, we've seen almost a 30 percent increase in oil and gas employment, while nationwide we've just kind of gotten back to where we were before the recession began."
Joseph Pratt, a business and history professor at the University of Houston, pointed to the famous blowout at the Spindletop oil well in the early part of the 20th century as somewhat analogous to what's being seen today.
That episode demonstrated the abundance of the nation's crude oil supplies and how to get it, leading directly to new growth in the Southwest from Houston to Los Angeles. Those developments later spread nationally, then globally as oil gradually replaced coal as the dominant fuel for transportation, much as natural gas may now be doing for coal in terms of electricity generation. But it may be too soon to tell.
Pratt cautions that the world is still just at the beginning of what could be a global revolution in shale drilling and the rise of gas as the main source of power. He declined to give any solid predictions of what the global picture might look like decades from today, but he still believes that the technologies and techniques leading to new gas and oil abundance will only improve, and may eventually go global.
"By 20 years from now we won't recognize the fracking industry. It will be more technologically advanced in all its aspects," Pratt said. "These things are long term, and historically they've tended to be regional before they're national before they're global."
The president and his administration may be touting an "all of the above" vision for energy, one that enthusiasts for both fossil fuels and renewables share. But Pratt believes that some sources of renewable energy will be hurt; natural gas is just too cheap and abundant -- and now much easier to get thanks to horizontal drilling and hydraulic fracturing.
That wasn't the attitude just a few short years ago.
A half-dozen years ago, climate change carbon trading, and Wall Street's enthusiasm for all things energy that's clean and efficient was the narrative. Most experts feared an increase in the country's dependence on imported energy, for both oil and natural gas (which was back then believed to be increasingly scarce). Eco-friendly skyscrapers rose in Manhattan, and the Northeast introduced its cap-and-trade system for controlling greenhouse gas emissions.
Meanwhile, back in Texas it was wind power, not oil production, that grew at an astonishing rate. That boom was fueled by both state policy favorable to renewables and the production and investment tax credits that kept New York's money flowing into places like Sweetwater, Texas.
Then again, no one predicted the effect of the drilling boom in Pennsylvania, North Dakota and elsewhere. The Marcellus Shale natural gas rush saw the Northeast's CO2 emissions drop by about a third, ironically hurting the newly minted cap-and-trade system there (New Jersey has since left the program). Texas proudly exported gas to the Northeast for a long time; now the Northeast supplies Texas and the Gulf of Mexico region's industries instead, and will increasingly do so for the foreseeable future. And with wind tax credits gone, Wall Street seems keener to invest more in fracking than anything else happening in Texas.
The outlook for wind isn't completely grim, at least in the near term. Greg Wortham, executive director of the Sweetwater-based Texas Wind Energy Clearinghouse, said this state is still seeing about 8,000 megawatts planned or under construction this year thanks to a favorable interpretation of the federal tax credit expirations by the Internal Revenue Service. Not all of this will be built, but the bulk will, he predicted.
Still, he acknowledged that inconsistent federal support has cost the nation renewable technology manufacturing opportunities.
"We lost a tremendous amount of manufacturing in the last three or four years because the United States Congress is busy trying to be against the president," Wortham said. "We lost manufacturing that we worked for a decade to bring in, from Siemens in Kansas, to Vestas in Colorado, to Nordex in Arkansas, to all the ancillaries around."
Gas blows into wind, but solar shines
Future fears of gas scarcity are also a thing of the past. Anticipation of liquefied natural gas imports from Russia and Qatar have been transformed into plans for LNG exports to Japan and the United Kingdom.
Christopher Guith, vice president of policy at the U.S. Chamber of Commerce's Institute for 21st Century Energy, recently traveled to Houston to get an update on developments and to share the view from Washington, D.C., to this city's petrochemical companies at a recent event. During a break, Guith told EnergyWire that the changes in the country's future energy picture have happened so quickly that many in the nation's capital still haven't come to terms fully with the new reality.
Chamber of Commerce research shows that while construction on previously committed-to wind energy projects continues, new starts have dried up almost entirely. Guith said the wind blades waiting to ship out of the U.S. could be a sign of things to come.
"Much of the wind has fallen out the sail that we saw back in 2009 when the stimulus was passed," Guith said. "We've gone from 100 miles per hour to zero, and if nothing else, it definitively demonstrates the 1-for-1 correlation between the production tax credit and actual wind investment."
Still, the reality appears more nuanced and mixed. Not all renewable energy is hurting, and not all fossil fuel sectors have a bright future ahead.
While wind power supporters are beginning to feel pain, solar power still seems to be doing well, continuing to be driven mainly by state and not federal policies.
Analysts at SNL Energy recently reported that the first quarter of 2014 was the strongest for new industrial-scale solar power projects. Even in Texas, solar power has grown by leaps and bounds, primarily driven by city leaders in San Antonio and Austin determined to bring more of it onto the grid. In rising oil provinces like Colorado and New Mexico, solar remains popular; the thinking seems to be that if you can pull energy from the sky, you should.
And Wortham cautioned that observers should not write off wind energy just yet. The jobs and manufacturing it brings remain popular even in rural Texas, and lawmakers in Austin continue their support. He said the industry is also making gains at reducing costs and improving efficiencies, while enticing new customers such as eco-minded companies. He believes the industry is scrambling to find a future course in a post-tax-incentive reality.
"Everybody's doing their best to move forward with the incredibly inconsistent national policy," Wortham said.
Coal and the climate wild card
And just as natural gas is harming wind power, coal's future in the U.S. energy mix looks just as fragile.
Coal exports are keeping miners employed, but plans for new coal-fired power plants are dropping off the radar even in coal-friendly states. The nation has long had a love-hate relationship with coal -- the source of heavy metal contaminants, acid rain, mountaintop mining and deadly coal-mine accidents, this cheap black rock has been the main fuel for the U.S. economy for generations. The new generation appears to be loving natural gas much more.
There's near-unanimous agreement that the shale gas revolution is here to stay. The future of the shale oil revolution is an open question, though Weinstein believes it will be with us for some time to come as well.
"I think it's sustainable," he said. "Oil and gas production isn't a speculative business anymore. It's more like a manufacturing process. You rarely have a dry hole, and we keep getting better and better at finding the sweet spots."
Weinstein said that the only thing that could threaten both is a more aggressive response to climate change.
It's a very real risk driven by the laws of physics: Increasing the proportion of greenhouse gases in the atmosphere will increase the atmosphere's propensity to retain heat longer. Fear of future risks that rising average global temperatures may bring could spur future leaders toward more aggressive action that could target even natural gas, the cleanest fossil fuel.
Pratt at the University of Houston agrees that the shape of the response to climate change is the one wild card left for shale oil and gas.
"This could become the equivalent of Spindletop, but we don't know that yet," Pratt said. "It's clearly an amazing technological leap to be able to do this. The question is will it be done all over the world and will government and people allow this to be done."