Beyond Petroleum: The Broader Effects of the Deepwater Horizon Oil Spill

The leak at the ill-fated Deepwater Horizon well appears to have been stopped. Of course, the oil that has been released into the environment has done, and may continue to do, damage to the region’s ecosystems and tourist and fishing economies—damage that continues, justifiably, to reverberate in the public discourse. Yet while it has been called the “greatest environmental disaster” in American history, the effects of the Deepwater Horizon oil spill of 2010 go well beyond direct environmental and economic damages.

Broadly speaking, the oil spill disaster disrupted, and possibly derailed, difficult negotiations on climate and energy legislation in the U.S. Congress. In the weeks before the spill, discussions were progressing quickly in the Senate to re-introduce the major climate and energy legislation that has been on the legislative agenda since the presidential elections of 2008. While this legislation has encountered repeated challenges, a bill did pass the House of Representatives in 2009; and the Senate reached tenuous compromise that increased support for new nuclear power and, more critically, allowed for the expansion of offshore oil drilling. These provisions seemed to have secured the support of enough wavering senators to ensure passage of the bill.

Yet as soon as the magnitude of the spill was realized, it was clear that the offshore oil provisions were a major political liability and discussion of the energy bill effectively ceased. The delay over the summer months has put the Senate too uncomfortably close to the mid-term elections in November; therefore, reanimating the bill seems unlikely. In turn, the delay in passing energy legislation stalls federal funds for research on renewable energy technologies, carbon capture and storage and nuclear power; and it hobbles the international negotiations on climate policy. Finally, because these items were priorities for the Obama administration, the delay creates a potential campaign issue for the November elections.

In addition, the oil spill has clearly decimated the carefully cultivated green-leaning reputation of BP. For nearly a decade, under former CEO Lord John Browne, “Beyond Petroleum” sought to place itself in the vanguard of corporate environmental responsibility—breaking with a then-monolithic oil industry in 1997 to engage with international policy discussions on climate change, pioneering its own internal carbon emissions trading system, making diverse investments in solar power and other renewable technologies, and funding biofuels research. Under Browne’s leadership, which ended in 2007, BP sought to be a different kind of oil company that was seen foremost as a responsible global citizen, earning it the admiration of many environmental advocates. However, BP had an operational side as well that did not always function smoothly—particularly in its U.S. subsidiaries—and these disconnected realities clearly were a liability for the corporate parent. BP’s relatively new CEO, Tony Hayward, having renewed the oil focus of BP’s corporate identity (“Back to Petroleum,” perhaps), did the company no favors with his widely acknowledged mishandling of BP’s public relations over the past months. The unraveling of BP’s image as a responsible corporate citizen must undoubtedly raise questions, certain to be studied carefully, about the proper execution of corporate social responsibility (CSR) strategies in large multinationals.

Finally, the spill once again highlights the familiar weaknesses of the United States’ current energy infrastructure. While supply was never disrupted (nor would it be from the loss of any single oil well), the spill recalls, in the phrase of Charles Perrow, the “normal accident” inherent in many of our energy industries—the accident that we all know shouldn’t happen if everything went smoothly and all the involved parties were perfectly competent but nevertheless seems to recur: oil spills, fatal coal mine accidents and (thankfully rare) nuclear incidents. Many of our energy supplies do carry some dangers. While this need not be the only criterion for deciding on our energy choices, events such as Deepwater Horizon vividly illustrate these hazards. Some energy technologies carry inherent risks. Such risks can and should be mitigated with appropriate corporate safety culture and regulatory oversight. But the “normal accident” can serve also as a reminder to consider alternate futures. The virtues of such futures are well understood—less reliance on volatile oil supply, lower greenhouse gas emissions and regional pollution, and more robust energy security—and the motivations therefore encompass far more than simple risk reduction.

Should Deepwater Horizon therefore create additional pressure to diversify America’s energy supply? Probably. But whether it will do so is a much more difficult question to answer. President Obama tried to make such a point in his Oval Office speech on the spill. Not much resulted from this speech, and if anything it was decided that Obama’s integrative approach was simply too dull. Through many decades, the United States has shown a persistent and remarkable ability to tolerate the costs of petroleum use, presumably because people feel the benefits are greater in the aggregate, or perhaps because of a disconnect between the benefits and costs. Obama’s speech didn’t flop because it was dull; it flopped because nobody wanted to hear it. In the end, Deepwater Horizon highlights the uncomfortable, and clearly hazardous, reality that we are deeply reluctant to look beyond petroleum.