Raising the Value of Going Green on the Battlefield

June 13, 2014

Does America’s reliance upon fossil fuels endanger U.S. service members? That’s what Adam Tiffen argued recently here at War on the Rocks. Tiffen pushes hard for increased federal funding for renewable energy and efficiency research as the answer. As a fellow soldier, I agree with Tiffen’s start point: moving fuel across the battlefield is both dangerous and expensive. Yet, as a student of energy finance, I reject his conclusion. The most appropriate remedy is not to simply pump more money into research and development. Instead, the Department of Defense must fully consider and account for the financial, opportunity, and human costs of sourcing and delivering energy in expeditionary environments. By doing so, the department will ensure the most economic and appropriate energy source will win — while our service members do, too.

As the Assistant Secretary of Defense for Operational Energy argued in her recent Foreign Affairs article, the U.S. military’s fuel demands pose a legitimate and serious risk to the institution. In my experience at the tactical level, the units with whom I served on small security stations and combat outposts needed hundreds of gallons of fuel delivered two or three times a week. Even when we used vehicles infrequently, we still needed fuel to power tactical operations centers, water pumps, heaters, and kitchen equipment. In Iraq, my unit’s demand was fulfilled by combat logistics patrols that reached us by ground, thanks to units such as Tiffen’s, as well as those nested within my own higher headquarters. Astoundingly, fuel comprised 50% of the supplies delivered by these logistics patrols, which required heavy tankers, and for local convoys, 20-25 soldiers to deliver and secure. In Afghanistan, fuel reached my unit’s outposts far more often by air, because the roads could not support the convoys, and because the risk from roadside bombs was too high. In both theaters, the final cost of delivered fuel typically exceeded its purchase price by several hundred times.

More importantly, delivering all that fuel — especially by ground — was a dangerous distraction from the mission. While Tiffen described the severe consequences too often borne by those conducting resupply operations, he did not directly address the costs incurred by the warfighting and support elements charged with keeping the ground lines of communication open and clear. As a company commander in the Army’s 82nd Airborne Division in Afghanistan, one of my unit’s central goals was to facilitate freedom of maneuver along a short stretch of Ring Road in Ghazni province. In order to keep the country’s only highway open, we regularly conducted security patrols on or directly adjacent to the road instead of focusing on our relationships with Afghans in villages farther away. While Highway 1 serves as more than a coalition supply line, for our unit that was its main role. We expended a great deal of time and money securing it so that we could protect those meant to deliver our fuel. Aside from exposing my paratroopers to high and perhaps unnecessary risks, these efforts prohibited me from conducting other, more critical operations such as developing Afghan security forces or defeating anti-coalition elements. As a result, these route security missions represented tremendous opportunity costs for my unit, as I am sure they did for other commanders across the country.

Until 2009, the aforementioned financial and opportunity costs remained disregarded externalities. The Department of Defense strove to internalize these externalities through the development of the Fully Burdened Cost of Energy (FBCE), wherein the price of a gallon of fuel includes the comprehensive cost of delivering it to the forward edge of the battlefield. FBCE factors the purchase price of fuel along with the burden on the delivery assets (cost of delivery, depreciation of assets that conduct the delivery, and other environmental or infrastructure costs), and the burden on security/force protection assets (cost of manpower and fuel consumed in security operations). By adding the cost of these burdens to the commodity price of energy — namely diesel and jet fuel — the DoD has lowered the relative costs of other energy sources. Because these values are largely scenario driven, one could argue the validity of these estimates (Hint: we probably should), but at least now the department has a number. As a result, alternative generation methods such as photo-voltaic generation (solar panels) and waste-to-energy combustion have become viable forms of energy generation and have been employed both overseas and at domestic installations. Importantly, these changes have not occurred because the government is attempting to “choose” winning technologies, but because economic conditions warrant their use. Where alternative generation methods such as waste-to-energy are employed, military forces have gained a more cost effective, productive and healthy substitute to burning waste in open pits; and they have also lessened their dependence upon fuel otherwise imported at tremendous cost to national and human treasure.

Though it required eight years of war, the department has done well to develop the FBCE. In contrast, it is startling to discover that private industry had not comprehensively considered the fully burdened cost of powering its data centers until as recently as 2010. Despite this progress, the DoD must do more. To Tiffen’s original point, it must reduce the overall risk to its limited means, logistics systems, and service members. Plainly, it must fully integrate not only costs measured in dollar, but also in casualties. While the U.S. Army Environmental Policy Institute released a report in 2009 detailing casualty factors for fuel and water resupply convoys, these risk factors have yet to be incorporated in the newly updated FBCE guidance. Furthermore, defense officials must also include the opportunity costs of operating fuel-hungry equipment into tactical planning. For example, the cost of securing a short stretch of Afghanistan’s Ring Road for logistics patrols was greater than the gas required to power four of my unit’s vehicles during the convoy. It included the cost of the previous three days’ route reconnaissance missions that facilitated a safe convoy as well as the lost opportunities to conduct key leader engagements with Afghan elders or develop capacity amongst the Afghan security forces. Until our headquarters can integrate factors such as these, military commanders directing combat operations will continue to face ambiguous and unnecessarily difficult decisions about how best to utilize our resources toward the myriad technologies for energy provision.

Research dollars alone will not fix this problem. So, while Tiffen is correct to call attention to the high cost of energy in terms of both treasure and lives, he is mistaken to advance greater R&D budgets as the most appropriate solution. The U.S. government (whether the Department of Defense or Energy) ought not focus simply on increasing funding levels; rather, it should strive to better internalize the various costs and risks to providing energy to the forward edge of the battlefield. If it can, the relative costs of alternative or more efficient means of generation will drop and the benefit will be far greater than merely the development of the next best technology. Though the gains certainly could include more sustainable generation methods, they may also include reduced demand through focused efforts to improve organizational culture toward the use of energy. Or they may include dramatic efficiency improvements through the implementation of currently commercially available, smart distribution systems such as microgrids. To save service members’ lives, we must think beyond spending money to create the next best thing. We must think smarter about our business processes and better use what we have by allowing actual economics to dictate our future decisions. Doing so will raise the value of and thereby compel us to “go green” on the battlefield.

 

Tim McDonald is an active duty U.S. Army officer attending Duke University’s Fuqua School of Business, where he is earning an MBA with a concentration in energy finance. He is a veteran of combat deployments to both Iraq and Afghanistan.  The views expressed are his own.

 

Photo credit: The U.S. Army