Sunday, March 27, 2005

Peak Oil Comes Out

Several months back, I began to notice a substantial change in the positions of important organizations around the country regarding the use of electrical fuel in the transportation sector as well as an increased interest in a solar hydrogen economy in general. The people at Edison Electric were suddenly on board with the electric fuel idea. Others across the Washington spectrum were making abrupt turns in their thinking about electric fuel and the Plug In Hybrid.

We mused with each other at the office what was happening.

I suggested that there must be a CIA type report floating around Washington that spoke to the reality of Peak Oil, and that the word was finally getting out to some of the beltway types who would be understandably slow to embrace such talk.

A few weeks back, I saw this story which proved that such a report was indeed out there.

US report acknowledges peak-oil threat
By Adam Porter in Perpignan, France
Wednesday 09 March 2005,

It has long been denied that the US government bases any policy around the idea that global oil production may be in terminal decline.

But a new US government-sponsored report, obtained by, does exactly that.

Authored by Robert Hirsch, Roger Bezdek and Robert Wendling and titled The Peaking of World Oil production: Impacts, Mitigation, & Risk Management, the report is an assessment requested by the US Department of Energy (DoE), National Energy Technology Laboratory.
It was prepared by Hirsch, who is a senior energy programme adviser at the private scientific and military company, Science Applications International Corporation (SAIC).

"Intervention by governments will be required, because the economic and social implications of oil peaking would otherwise be chaotic. But the process will not be easy. Expediency may require major changes to ... lengthy environmental reviews and lengthy public involvement."
Hirsch notes, despite arguments from the major oil companies and producer nations, that new finds of oil are not replacing oil consumed each year. Despite the advances in technology, reserves are becoming increasingly difficult to replace.

But in its conclusion the report makes troubling reading, noting that "the world has never faced a problem like this. Without massive mitigation more than a decade before the fact, the problem will be pervasive and will not be temporary. Previous energy transitions were gradual and evolutionary. Oil peaking will be abrupt and revolutionary."

Then, I found the report on this site late last week.

The first sentence in the Executive Summary pretty much says it all:

The Peaking of World Oil production presents the US and the World with an unprecedented risk management problem.

And the closing paragraph of the Summary begins with this doozy:

In summary, the problem of peaking in world conventional oil production is unlike any yet faced by modern industrial society.

Let me repeat that,

In summary, the problem of peaking in world conventional oil production is unlike any yet faced by modern industrial society.

Although the report is clearly sanitized, it is very provocative. Many of the peak dates referenced are within the next few years. The report calls for wedge policies which can begin to manage the risk associated with this peaking.

Perhaps the silliest thing in the report is the statement that electricity cannot be made into liquid fuel.

All in all though, it's a good primer on the subject in general, and on the use of oil, and on the possible replacement policies and technologies.

And then this Friday, the New York Times runs this editorial by Kenneth S. Deffeyes, a professor emeritus of geology at Princeton, and the author of "Beyond Oil: The View from Hubbert's Peak."

After a little foreplay, Mr Deffeyes goes in for his point:

A permanent drop in world oil production will have serious consequences. In addition to the economic blow, there will be the psychological effect of accepting that there are limits to an important energy resource. What can we do? More efficient diesel automobiles, and greater reliance on wind and nuclear power, are well-engineered solutions that are available right now. Conservation, although costly in most cases, will have the largest impact. The United States also has a 300-year supply of coal, and methods for using coal without adding carbon dioxide to the atmosphere are being developed.

After world oil production starts to decline, a small group of geologists could gather in my living room and all claim to have discovered the peak. "We told you so," we could say. But that isn't the point. The controversy over the Arctic National Wildlife Refuge is a side issue. The problem we need to face is the impending world oil shortage.

Then, just to add a little cheery cherry to the top of the cake, this story appears.

Energy body wants brakes on fuel consumption
By Adam Porter in Perpignan, France
Thursday 24 March 2005,

The International Energy Agency is to propose drastic cutbacks in car use to halt continuing oil-supply problems. Those cutbacks include anything from car-pooling to outright police-enforced driving bans for citizens.

Fuel "emergency supply disruptions and price shocks" - in other words, shortages - could be met by governments. Not only can governments save fuel by implementing some of the measures suggested, but in doing so they can also shortcut market economics.

An advance briefing of the report, titled Saving Oil in a Hurry: Measures for Rapid Demand Restraint in Transport, states this succinctly. "Why should governments intervene to cut oil demand during a supply disruption or price surge? One obvious reason is to conserve fuel that might be in short supply.

"But perhaps more importantly, a rapid demand response (especially if coordinated across IEA countries) can send a strong market signal."

The report goes on to suggest a whole series of measures that could be used to cut back on fuel consumption. They are cutting public-transport costs by a certain amount to increase its usage while simultaneously dissuading car use.

Then more radically the idea of going further and cutting public-transport costs by 100%, making them free to use. Car-pooling, telecommuting and even corrections to tyre pressures are also suggested.

But the most hardline emergency proposals come in the form of drastic speed restrictions and compulsory driving bans. Bans could be one day in every 10 (10%) or more stringently on cars with odd or even number plates. They would be banned from the roads on corresponding odd or even days of the month (50%).

In forming its conclusions the IEA tacitly admits that extra police would be needed in these circumstances to stop citizens breaking the bans. Even the cost of those extra patrols are part of the IEA's study.

"Policing costs are more substantial and may consist of overtime payments for existing police or traffic officers or increases in policing staff. We assume this cost at one officer per 100 000 employed people."

Around here, that's 10 more officers for fuel use enforcement.

"Our main conclusion finds that those policies that are more restrictive tend to be most effective in gaining larger reductions in fuel consumption. In particular, driving restrictions give the largest estimated reductions in fuel consumption."

Here, however, they do strike a word of warning for governments and those in power.

"Restrictive policies such as this can be relatively difficult to implement and thus may come at higher political costs."

According to the IEA's little-known emergency treaty, the Agreement on an International Energy Programme (IEP), "measures to achieve demand restraint fall into three main classes - persuasion and public information, administrative and compulsory measures, and finally, allocation and rationing schemes".

This would mean that countries who signed up to the treaty, including the five biggest economies of the world - US, Japan, Germany, UK and France - would all have to institute cuts.

Who needs Kyoto when we've got the "Agreement on an International Energy Programme?"

It reminds me of the scene in Butch Cassidy and the Sundance Kid when they are getting ready to jump off of the cliff into the deep river to avoid getting caught. Sundance gets nervous because he can't swim.

Butch soothes him by saying,

Don't be silly,

The fall is going to kill you.

And the Perfect Storm gathers,

for the Earthfamily.



Anonymous Anonymous said...

I have also noticed a distinct change in press reports discussing the end of cheap oil and an awareness of the eventual depletion of the world’s oil. Most articles correctly mention that renewable energy will eventually step in to replace energy from oil and natural gas, but the articles generally, and incorrectly, imply that renewable energy cannot supply a significant amount of the world’s energy for the foreseeable future. The renewable energy community must convey the message to the public that renewable energy is ready for rapid and significant contribution to world energy needs and that that the largest source of renewable energy is likely to be photovoltaic electricity. CHF

6:41 PM  
Anonymous Anonymous said...

This comment has been removed by a blog administrator.

6:45 PM  
Anonymous Anonymous said...

what about this international energy agency report? this is huge. I had to read this twice.

11:04 AM  
Blogger oZ said...

I don't see how anyone can read these three stories together and not become convinced that indeed our institutions have led us into a boxed canyon.

Either we are led by very smart men who are very good liars or we are led by idiots.

I think Mark Twain said that.

12:38 PM  

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