peak fossil fuels by 2017

[apeiron]

Steve Mohr of Australia's Newcastle University has modelled the earth's fossil fuel reserves and come up with this massive study (warning: 13mb).

PROJECTION OF WORLD FOSSIL FUEL PRODUCTION WITH SUPPLY AND DEMAND INTERACTIONS
http://ogma.newcastle.edu.au:8080/vital/access/services/Download/uon:6530/SOURCE4?view=true

Plenty of gems in the study, like current energy consumption being the equivalent of every person on earth having 90 slaves.

But headlines are that best guess for a production peak in fossil fuel is 2016–18 (at a total production rate of 509–525 EJ/y).

For the fossil fuels individually:

Coal - 2019 (212–214 EJ/y).

Oil - 2011-12 (179–188 EJ/y).

Natural gas - 2019-2062 (143-157 EJ/y).

Unconventional oil and gas will probably create a shoulder to the production curves, which will slow the fall-off the other side of their peaks, but will not change the peak dates themselves.

The most optimistic scenario for oil (p136 - case 2 dynamic) does see a second oil production peak circa 2110 that about matches the conventional oil peak. However this would have to be all shale oil (tar sands would be gone by then).

It is a little surprising that coal has so little time left (as China and India seemed to be rather relying on coal) and that gas will be such a big player in the final wash-up. On the other hand, it is what Mohr's group have learnt about Chinese coal consumption which is accelerating that peak.

On the optimistic side, Mohr notes, it sure puts a concrete limit on the carbon footprint issue :smile:.

[Office_Shredder]

Slow internet connection, so it's gonna take me a bit to see the pdf. From your post though:

The most optimistic scenario for oil (p136 - case 2 dynamic) does see a second oil production peak circa 2010 that about matches the conventional oil peak. However this would have to be all shale oil (tar sands would be gone by then).

Unless I missed something tar sands are not gone by 2010

[apeiron]

Unless I missed something tar sands are not gone by 2010

Peak production means you have burnt half, and still have another half to go. And the peak year is when the transition happens. So that is the year when you use the record amount. After that, production is forever in decline. And priced accordingly.

Tar sand is such an unattractive proposition that it has been left to last. We barely exploit tar sands yet but may have to ramp up fast (just as we are having to move into deep water drilling for conventional oil). However tar sands just plug the gap for a while.

Mohr's "best case" scenario shows no more conventional oil at all by 2100 and then no more useable tar sands by 2150. Shale oil would be pretty much done by 2180 - if you believe it can actually ever get started. Shale oil as a choice makes tar sands look pretty.

[apeiron]

If 13mb is too much to download, a summary is here...

http://www.energybulletin.net/node/53509

[mheslep]

On the optimistic side, Mohr notes, it sure puts a concrete limit on the carbon footprint issue :smile:.I don't know about 'concrete' since as you stated above this is based on a model. What's optimistic about energy source depletion?

In general, since this posted in the political forum, did you intend this to be a political discussion?

[mheslep]

Tar sand is such an unattractive proposition...Unattractive how? Do you mean something other than the increased CO2 emissions?

[Jack21222]

Tar sands and oil shale are much more expensive to extract useful oil from than light sweet crude.

I also wanted to add, whether peak oil happens in 2017 or in 2037 or anything in between, it's still a blink of an eye when looking at civilization. Even if the peak doesn't happen quite that soon, the problem still needs to be addressed immediately.

[Office_Shredder]

Peak production means you have burnt half, and still have another half to go. And the peak year is when the transition happens. So that is the year when you use the record amount. After that, production is forever in decline. And priced accordingly.

Tar sand is such an unattractive proposition that it has been left to last. We barely exploit tar sands yet but may have to ramp up fast (just as we are having to move into deep water drilling for conventional oil). However tar sands just plug the gap for a while.


I know what peak production means. The problem was that you had a typo and said 2010 instead of 2100 :tongue2:

[mheslep]

Tar sands and oil shale are much more expensive to extract useful oil from than light sweet crude.
I know that, but I don't know that tar sand oil reserves are 'unattractive' at a world crude price of $75/bbl. Without checking I though tar sands extraction ran around ~$50/bbl. Furthermore there's no missing geopolitical rogue state external cost with Canadian tar sand oil, as there is with imported Middle Eastern oil.

[Office_Shredder]

I know that, but I don't know that tar sands are 'unattractive' at a world crude price of $75/bbl. Without checking I though tar sands extraction ran around ~$50/bbl. Furthermore there's no missing geopolitical rogue state external cost with Canadian tar sand oil, as there is with imported Middle Eastern oil.

Oh, you just wait. Once the Canadians get filthy rich on tar sand money, there's no telling what they'll do

[mheslep]

Oh, you just wait. Once the Canadians get filthy rich on tar sand money, there's no telling what they'll do:biggrin: Yes, could be, though I doubt they'll start flying airplanes into buildings containing bunches of Canucks arguing with Yanks about hockey.

[apeiron]

I know what peak production means. The problem was that you had a typo and said 2010 instead of 2100 :tongue2:

Ahh, thanks. I've corrected that. :blushing:

[apeiron]

I know that, but I don't know that tar sand oil reserves are 'unattractive' at a world crude price of $75/bbl. Without checking I though tar sands extraction ran around ~$50/bbl.

Various snippets on tar sands.....

At some point in the foreseeable future Canada's domestic energy needs and U.S. Energy policy are headed for an inevitable clash. Canada's conventional oil production is already in decline and will continue to decline. Natural gas production is barely holding despite an unprecedented amount of drilling in the last couple of years. And Canada's domestic energy needs are growing at 3-4% per year. It is a worrying prospect for Canadians as energy sovereignty was effectively surrendered under the NAFTA agreement. Canada's energy resources must, under the agreement, be open and accessible to corporate energy interests. To date, four of the five oil majors (Royal Dutch/Shell, ExxonMobil, ChevronTexaco, and TotalFina) have invested or committed themselves to invest billions of dollars in tar sands development. National oil companies have also staked their claim, ranging from Norway's Statoil to China's Sinopec.

The Canadian region defined as "the Athabaska tar sands" covers an area over 140,000km2 of once virgin boreal forest, a larger area than the state of Florida. It is estimated to hold an equivalent 1.7 trillion barrels of oil or more. But of that only 150-200 billion barrels (about 10 percent) may be recoverable "with today's technology and under current and anticipated economic conditions".

the tar sands as "Canada's dirty secret." The tar sands mines are each as big as 150 square miles and may be 300 feet deep, each leaving a tremendous scar on the landscape. Depending on the bitumen concentration, 4-6 tons of material must be moved and processed for every barrel of synthetic crude produced. Over 80 per cent of the established tar sands reserves are deeper and must be extracted in situ. Reclaiming and cleaning up the land damaged by tar sands operations will be a monumental task. According to the paper The Harm the Tar Sands Will Do, "after 40 years of mining, not a single operation has received a reclamation certificate from the government of Alberta. Suncor Energy's operation, the longest-operating tar sands mine, says it has reclaimed 858 hectares of land since starting operations in 1967, less than nine per cent of the land its operations have disturbed to date. Syncrude Canada, the largest daily producer of tar sands, says its operations have disturbed 18,653 hectares since 1978, with just 4,055 hectares of land reclaimed.

In conclusion, tar sands are an economically and energetically viable, although hardly ideal, approach to maintaining liquid fuel supplies. The most severe problem is probably their local and global environmental impact, and they are already impacting Canadian CO2 releases significantly. But the tar sands are unlikely to make a large impact on overall supply of liquid fuels because their supply is likely to be rate, rather than total resource limited. If the maximum rate were to grow to about 2 billion barrels a year this would approximately meet Canada’s demand and could leave relatively little for export if Canada’s production of conventional oil continues to decline. Achieving even this rate of production from tar sands is uncertain because of growing concerns about environmental impacts downstream and insufficient hydrogen and water.
http://www.theoildrum.com/node/3839


Furthermore there's no missing geopolitical rogue state external cost with Canadian tar sand oil, as there is with imported Middle Eastern oil.

Indeed and here is an estimate of that cost...

The energy security cost to the U.S. of maintaining the uninterrupted
flow of oil from this area is approximately $50 billion per year, and
depending on various assumptions in several studies, can make the
true cost of oil, counting military and energy security expenses,
as high as $100-$150 per barrel.

A study by the National Defense Council Foundation (NDCF) in
2003 provides the most in-depth examination of this subject since
the 1987 study by the General Accounting office, which was prior
to the first Gulf War. The NDCF study found that America spends
$49.1 billion defending Persian Gulf oil, adding more than one
dollar to the cost of a gallon of gasoline.
The study further concluded that the overall economic toll of this
dependence on foreign oil is staggering. The diversion of capital and
investment resulting from spending nearly $100 billion annually on
foreign oil, i.e. money that would otherwise be spent in the U.S., costs
the U.S. economy more than 800,000 jobs per year, and costs federal,
state and local government treasuries $13.4 billion in lost revenues.
A National Defense Council Foundation study found that when taken
together, the economic losses, the defense costs, and oil supply
distribution costs bring the total cost of imported oil to approximately
$250 billion per year, or close to $4.00 per gallon over the current
purchase prices of gasoline.

http://www.ethanol.org/pdf/contentmgmt/Energy_Security_Issue_Brief.pdf

The "good" news for the US is that it is rich in oil shale....

While oil shale is found in many places worldwide, by far the largest deposits in the world are found in the United States in the Green River Formation, which covers portions of Colorado, Utah, and Wyoming. Estimates of the oil resource in place within the Green River Formation range from 1.2 to 1.8 trillion barrels. Not all resources in place are recoverable; however, even a moderate estimate of 800 billion barrels of recoverable oil from oil shale in the Green River Formation is three times greater than the proven oil reserves of Saudi Arabia.”

Shale oil is guesstimated as approximately half as efficient to produce as oil from tar sands. American oil shales are also located in arid areas which are more ecologically sensitive than the tar sand areas of Canada.

In conclusion, although shale oils represent a huge potential resource they have a history of “always a bridesmaid and never a bride” because as prices for oil increase the prices for extracting shale oil have increased as well. This history represents the very real problems of generating a useful product from the resource. The main problems include the distance of the shale from both the water and labor needed to extract it, the large environmental impact compared to conventional oil and the relatively low EROI . In addition, with both shale and tar sands there is some disagreement whether the in situ should be charged as an energy opportunity cost, (in the same sense that bagasse could be in sugar cane ethanol). Ultimately, the question is, if conventional oil becomes very scarce whether a resource such as shale oil will be developed regardless of cost.

http://www.theoildrum.com/node/3839

[JaWiB]

We'll be pretty well screwed if we use up all the coal (unless someone figures out a great carbon sequestration method before then).

The crazy thing is that the US still has subsidies for fossil fuels, and probably quite a bit more subsidies for fossil fuels than for renewables.

[apeiron]

In general, since this posted in the political forum, did you intend this to be a political discussion?

Of course. What drives politics, economics and world affairs more than energy? It is the fundamental input. The British empire was built on its access to cheap coal, the US empire on its access to cheap oil.

Peak energy consumption will equal peak economic activity and peak global harmony (arguably :smile:). After that, the game changes radically.

If it is to be BAU (business as usual) then we need a new cheap energy source in a very short time it seems. And how many reactors could we build, or turbines erect, in seven years?

[Office_Shredder]

And how many reactors could we build, or turbines erect, in seven years?

As many as we're willing to pay for of course. There were something like 9 million construction workers in 2009; a quarter of them are now unemployed. Assuming the federal government decides it's a no holds barred contest to break our fossil fuel usage, labor and material supplies are the limiting factor

Relying on

http://nextbigfuture.com/2007/07/constructing-lot-of-nuclear-power.html

Materials isn't the problem. If 1000 power plants takes up 10% of the world's annual concreete and steel supplies, over 5 years that's only 2% of the annual supply, which isn't bad. And if it takes 10,000 construction workers to build the thing in that time (a guess) that's 10 million jobs. A quarter of the workers are freely available, and the remaining three quarters can be taken from other sectors (there are some 15 million people unemployed in the US). Maybe that's an unfeasibly large inexperienced workforce, but certainly hundreds of new power plants could be built

[mheslep]

And how many reactors could we build, or turbines erect, in seven years?More like 100 years for oil (out to 2110) if we believe Mohr's case 3. Mohr has similar numbers for natural gas case 3. And in any worst case scenario, fossil fuels do not entirely collapse in seven years.

[ZQrn]

Oh boy, I remember the 'pessimistic' estimates in 1995 still being 2050, and that was near then. The pessimists are always more realistic it seems.

I also read the other day that IPv4 is expected to be saturated in 2010, that's also quite near.

[apeiron]

More like 100 years for oil (out to 2110) if we believe Mohr's case 3. Mohr has similar numbers for natural gas case 3. And in any worst case scenario, fossil fuels do not entirely collapse in seven years.

Is this a rational summary of his findings?

Again, making the energy/economy link, we are really saying that unless we can find some other energy source, world GDP will peak in 2017 and smoothly decline for ever after. And this transition point looms in seven years on middle-ground assumptions.

The actual range of his worst and best case scenarios for peak fossil fuels is suprisingly narrow - 2012 to 2029.

Fossil fuel productions for CASE 1, CASE 2 and CASE 3 is projected to peak between 2012 and 2029 at 433 – 581 EJ/y.

[mheslep]

Is this a rational summary of his findings? I'm only attempting above to cite Mohr not make deductions (so far). As far as I can tell those are roughly the empirical numbers for case 3 out to the point of depletion/ collapse in production, not a peak (Mohr's figure attached below) I thought near depletion was what you had in mind when you said:
And how many reactors could we build, or turbines erect, in seven years? by which I assumed you meant at least a large fraction, if not most, of the existing secondary power plants had to be replaced. Such a case would not come about from a mild transition to post peak production, but only from a collapse in production.

...Again, making the energy/economy link, we are really saying that unless we can find some other energy source, world GDP will peak in 2017 and smoothly decline for ever after. And this transition point looms in seven years on middle-ground assumptions.We? At least in the US, energy consumption per capita peaked back in the late seventies yet GDP has managed to increase substantially (per the World Bank):
http://www.google.com/publicdata?ds=wb-wdi&met=eg_use_pcap_kg_oe&idim=country:USA&dl=en&hl=en&q=us+energy+consumption+per+capita
It may be that energy production and GDP is more closely correlated in developing countries like China, which strikes me as intuitive, but I doubt the correlation holds very tightly in developed countries (i.e. how many yachts can one water ski behind?).

Fossil fuel productions for CASE 1, CASE 2 and CASE 3 is projected to peak between 2012 and 2029 at 433 – 581 EJ/y.
Yes. Note that per Mohr 2100 production is still ~450 EJ/y in case 3.
http://i28.tinypic.com/6h81mq.jpg
Given one EJ/yr is produced by ~32 GW(e) plants/reactors running at 100% capacity factor, the 131 EJ/yr energy deficit by 2100 would covered by building 45 GW(e) 100% capacity factor non-fossil replacement units (nuclear/solar/wind/geothermal/efficiency improvements/etc.) per year, worldwide, for ninety years. For comparison, China alone has been adding new electric capacity at a rate of ~62 GW(e) per year (fossil and other)
http://www.eia.doe.gov/cabs/China/images/china-elec_by_type2.gif

[apeiron]

I'm only attempting above to cite Mohr not make deductions (so far). As far as I can tell those are roughly the empirical numbers for case 3 out to the point of depletion/ collapse in production, not a peak (Mohr's figure attached below) I thought near depletion was what you had in mind when you said:


Case 2 is Mohr's best guess choice, case 3 is the optimistic outlier. So long as you are clear about the difference. And again, what is striking is that all three cases are quite narrowly grouped.

On the meaning of a peak, of course I understand that we are roughly saying half gone, so half still left. But we are also saying all the cheap, high EROEI, is gone, now we are left with the expensive low EROEI. Which has obvious direct consequences for economics and politics.

I realise no-one really wants to believe the situation can be as dire as these kinds of studies suggest. So it would cheer me up if you actually had convincing arguments about why there is no reason to worry.

I had a chance to chat with one of your undersecretaries for energy earlier this year. She was quite optimistic about how the US would cope. She cited the figures for how much wind is just waiting to be harnessed in the mid-west. She said Obama's 20 year goals to shift to alternatives would be achieved in 10, because the need was so urgent. It was all very "can do". Yet I still went away feeling I had heard nothing of substance. There was no sense of concrete detail that would actually make any of this happen.


We? At least in the US, energy consumption per capita peaked back in the late seventies yet GDP has managed to increase substantially (per the World Bank):
http://www.google.com/publicdata?ds=wb-wdi&met=eg_use_pcap_kg_oe&idim=country:USA&dl=en&hl=en&q=us+energy+consumption+per+capita
It may be that energy production and GDP is more closely correlated in developing countries like China, which strikes me as intuitive, but I doubt the correlation holds very tightly in developed countries (i.e. how many yachts can one water ski behind?).


In fact I was reading a study the other week that argued real average wealth in the US has stagnated since the 1970s. And the curves matched oil consumption. I'll try to find it again.

Generally, the correlation is good in the research I've read. And it makes sense that energy is the basis of wealth. A more efficient economy would extract more work from the same amount of energy of course. But this is well understood from basic ecology. And ecological economists are the ones to be listening to these days.

On China, energy consumption has soared in line with GDP as the China miracle has recently been driven by infrastructure - construction.

Unfortunately, all the signs are that what they have been mostly building is a property bubble - whole cities of empty apartment blocks funded by crazy finance.

http://globaleconomicanalysis.blogspot.com/2010/07/ponzi-shark-loans-fuel-chinas-housing.html

The miracle may shortly prove to be a mirage. Although people are saying the saving grace for China is that it still holds so many US dollars and keeping the dollar artificially high will have proved a good insurance policy.

A crazy age, don't you agree?

[mheslep]

[...]I realise no-one really wants to believe the situation can be as dire as these kinds of studies suggest. I'm interested in discussing a model such as Mohr's based on the actual results he obtains and crunching more numbers to see where that might take us (as I did above). However, I don't see the utility in pursuing arbitrary characterizations about what is or is not 'dire' without some kind of verifiable context. By contrast, and for instance, above I attempted to place Mohr's fossil fuel energy deficit as of 2100 in context by showing the feasibility of replacing it. After all, this is a science & engineering forum and I hope to pursue those lines.

I don't see utility in grouping critiques in with some kind of conjured group who are imagined as refusing to 'believe' in the latest Malthusian predictions, or about hand waiving away energy policy proposals without examination as containing nothing of value. Also, the continued reliance on blogs as a point-maker, while sometimes interesting when identified as such, is not useful to build a discussion on firm ground, as one can quickly find blog 'evidence' from no less than tenured professors showing how on 911 it was actually US officials that directed aircraft into the WTC.

In fact I was reading a study the other week that argued real average wealth in the US has stagnated since the 1970s. And the curves matched oil consumption. I'll try to find it again.I imagine that can only refer to some income inequality discussion, a digression I'd not like to pursue here, as there's no question gross US economic output has seen substantial growth since the 1970s. The data, in real terms, is readily available: US GDP has more than tripled since 1970.

http://www.usgovernmentspending.com/usgs_line.php?title=US%20Real%20Gross%20Domestic%2 0Product%20GDP%20History&year=1970_2010&sname=US&units=k&bar=0&stack=1&size=m&col=c&spending0=4269.9_4413.3_4647.7_4917_4889.9_4879.5_ 5141.3_5377.7_5677.6_5855_5839_5987.2_5870.9_6136. 2_6577.1_6849.3_7086.5_7313.3_7613.9_7885.9_8033.9 _8015.1_8287.1_8523.4_8870.7_9093.7_9433.9_9854.3_ 10283.5_10779.8_11226_11347.2_11553_11840.7_12263. 8_12638.4_12976.2_13254.1_13312.2_12990.3_13112.1

[apeiron]

I'm interested in discussing a model such as Mohr's based on the actual results he obtains and crunching more numbers to see where that might take us (as I did above).

Which still does not explain why your analysis is focused on case 3 rather than case 2, except as a personal prejudice.

You have not provided a reason why his best guess middle path is in fact less likely than his most optimistic one.

But yes, it would certainly be interesting to follow up his study with an estimate of the actual gap for his various scenarios, and thus the number of nuclear reactors, wind turbines, or whatever would be needed to fill it.

[Office_Shredder]

Tripled since 1970... inflation has done far more than that

http://nowandfutures.com/inflation_long_term.html

[mheslep]

Which still does not explain why your analysis is focused on case 3 rather than case 2, except as a personal prejudice.

You have not provided a reason why his best guess middle path is in fact less likely than his most optimistic one.Correct I haven't; I picked one. Mohr provided three cases from a model, a non-peer reviewed model (so far); I'm inclined to pick #3 for the moment.

But yes, it would certainly be interesting to follow up his study with an estimate of the actual gap for his various scenarios, and thus the number of nuclear reactors, wind turbines, or whatever would be needed to fill it.Well I tried to give it a go above. One EJ/yr requires 32 GW, at 100% capacity factor for electric generation. That translates roughly to (worldwide) any of the following (all electrical cases):
o 31 AP1100 nuclear reactors running at the US average 93% capacity factor (or 15 of the common two reactor plants)
o 32 of the one year increases in Texas wind capacity seen in 2007-2008 (2.76 GW peak) at 37% capacity factor ( or 32 * 1850 1.5 MW wind turbines)
o A 3.5% increase in US electrical generation or usage efficiency, or both. (assuming a 900GW(e) average US electrical load)

Again, all of those provide one EJ/year, with Mohr predicting a ~131 EJ/yr deficit by 2100. So the rate of deficit is about 1.5 EJ/year.

[apeiron]

I imagine that can only refer to some income inequality discussion, a digression I'd not like to pursue here, as there's no question gross US economic output has seen substantial growth since the 1970s. The data, in real terms, is readily available: US GDP has more than tripled since 1970.


This wasn't the study I was looking at, but it is a meta analysis of the energy/GDP correlation of 88 countries.

We use panel data for 88 countries to test for cointegration between per capita real GDP
and per capita energy consumption. We find that these two variables are cointegrated.
Thus, we conduct tests for short-run, long run and strong Granger causality between the
growth rates of per capita GDP and energy consumption. We find evidence for two-way
short-run, long-run and strong causality between the two variables. These results
contradict the results of a number of other studies using panel data.

http://mpra.ub.uni-muenchen.de/18446/1/MPRA_paper_18446.pdf

And here is some data on US stagnation for the ordinary Joe.

EPI data tracking income and wage patterns show that the majority of income growth has for decades gone to a startlingly small number of top earners, while other workers have suffered a persistent stagnation or even decline in real earnings.
This pattern is best illustrated in the following chart, which shows that 34.6% of all income growth over the past three decades has gone to the top one-tenth of 1% of all earners. By contrast, the bottom 90% of all earners has collectively seen only 15.9% of all income growth over the same period.
http://www.epi.org/analysis_and_opinion/entry/a_long_and_persistent_middle-class_squeeze/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+epi+Economic+Policy+Institute #When:21:21:59Z

[CRGreathouse]

By contrast, the bottom 90% of all earners has collectively seen only 15.9% of all income growth over the same period.

Wow, that sounds pretty good.

[apeiron]

Correct I haven't; I picked one. Mohr provided three cases from a model, a non-peer reviewed model (so far); I'm inclined to pick #3 for the moment.


OK, cherry-picking the outlier, we still have a story where fossil fuel energy falls off the cliff circa 2020, plummeting ~100 EJ/yr. So it is not a gentle linear decline rate out to 2100 but an energy plunge from 2020 to 2050 (co-inciding with peak population of course).

And then things level out a bit for the next 50 years - based on the one huge compensating factor of shale oil.

So your optimism rests on the US being willing to dig up its backyard when the time comes? Is this what you are saying?

[apeiron]

Wow, that sounds pretty good.

It's truly impressive.

You get a thousand people in the room and show them this really big luscious cake and cut it into six peices. You pick out one person in the room and say hey, you look really deserving. Here, have two slices all to yourself. Enjoy! Then you take a third slice and say well this is going to have to be shared by the next 900 of you. Way to go! Outstanding.

[Jack21222]

(co-inciding with peak population of course).


This is a very important point which isn't being made enough. We very well may be looking at 9 billion people on the planet by 2050 according to a UN Prediction (http://esa.un.org/unpd/wpp2008/fig_1.htm). Plus, world per capita GDP will continue to rise as it always has, and more GDP generally means more energy.

While production levels off and starts to decline, even in the most optimistic scenarios, energy usage will continue to go up.

[CRGreathouse]

You get a thousand people in the room and show them this really big luscious cake and cut it into six peices. You pick out one person in the room and say hey, you look really deserving. Here, have two slices all to yourself. Enjoy! Then you take a third slice and say well this is going to have to be shared by the next 900 of you. Way to go! Outstanding.

Does that bother you? I figure my deserts are limited to a fair share of the 6000 BC cake, which is vastly smaller. That my percent share is small means little to me, given the size of the cake.

[Office_Shredder]

Does that bother you? I figure my deserts are limited to a fair share of the 6000 BC cake, which is vastly smaller. That my percent share is small means little to me, given the size of the cake.

People work hard to make their country and their society better. People go to war and fight and die trying to preserve their country. If you ask a soldier from WWII if he fought so that everyone in America could have a standard of living comparable to 6000BC, and a select few could be super wealthy and own the country, he would say no. If you ask Thomas Jefferson and Benjamin Franklin if they did what they did to found this country so that a select few could hoard all the wealth in this country, of course they would say no.

To say that your baseline is living in a cave and hunting animals for dinner is to ignore the fact that hundreds of years of work has been done by people to raise and maintain society as a whole to a better standard of living. If someone then found a way to destroy that and send everyone except for themselves back to the stone age, it should bother you immensely.

[russ_watters]

Tripled since 1970... inflation has done far more than that

http://nowandfutures.com/inflation_long_term.html That's tripled after inflation. It says so right on the side bar of the graph that all the numbers are adjusted for parity with the 2005 dollar value.

[russ_watters]

And here is some data on US stagnation for the ordinary Joe.

[separate post]
You get a thousand people in the room and show them this really big luscious cake and cut it into six peices. You pick out one person in the room and say hey, you look really deserving. Here, have two slices all to yourself. Enjoy! Then you take a third slice and say well this is going to have to be shared by the next 900 of you. Way to go! Outstanding. Then later, you go back to them with a much bigger cake and give them a much bigger piece than they had before. Since their stomach hasn't grown with the growing cake, they find themselves well satiated by their bigger piece of cake.

I don't believe that when the rubber meets the road, people's view of their economic situation is based primarily on envy. While that view has a lot of traction on internet forums and maybe even in front of a bar and other places where people like to complain/vent, if your boss called you into his office and gave you a 15.9% raise, your first thought will not be "gee, I wonder what the other guys got", but will rather be "gee, I wonder what I can buy with this".

A person's actual living conditions are based on what they themselves earn, not what someone else earns. If Bill Gates's net worth suddenly doubles over the next year due to a recovery by the stock market, my ability to afford my mortgage will not disappear.

[russ_watters]

I realise no-one really wants to believe the situation can be as dire as these kinds of studies suggest. So it would cheer me up if you actually had convincing arguments about why there is no reason to worry. Though I haven't read the full study yet, it appears to me that except for a small handful of one-liner snippets of editorializing, it is almost entirely a numerical projection of supply. Words like "dire" and "worry" don't seem to fit unless there are predictions made about what happens to the US/world economy as a result of these supply models. The study doesn't discuss them, so any discussion of them stemming from the study is essentially just idle speculation.

Will the economy collapse? Will we adapt by building nuclear plants and buy electric cars? The study contains no discussion of those issues whatsoever.

[TubbaBlubba]

A person's actual living conditions are based on what they themselves earn, not what someone else earns. If Bill Gates's net worth suddenly doubles over the next year due to a recovery by the stock market, my ability to afford my mortgage will not disappear.

Besides, the worth of money is relative. I doubt Bill Gates uses his money to buy a million gallons of milk.

[mheslep]

I don't believe that when the rubber meets the road, people's view of their economic situation is based primarily on envy. While that view has a lot of traction on internet forums and maybe even in front of a bar - and other places where people like to complain/vent, if your boss called you into his office and gave you a 15.9% raise, your first thought will not be "gee, I wonder what the other guys got", but will rather be "gee, I wonder what I can buy with this".

A person's actual living conditions are based on what they themselves earn, not what someone else earns. If Bill Gates's net worth suddenly doubles over the next year due to a recovery by the stock market, my ability to afford my mortgage will not disappear.I believe people have a mix of both: 1) 'Yes I can prosper on my own' and 2) envy. In my experience and reading, the balance between the two varies around the world. In the US in particular I think we are much more oriented to #1, i.e. I can prosper without tearing down the other guy, that the pie is dynamic and grows. This mindset is exceptional to the US in my view, and most of us don't realize the extent of the difference from the rest of the world.

Example:BONO: I don't know. Ireland has a very different attitude to success than a lot of places, certainly than over here in the United States. In the United States, you look at the guy that lives in the mansion on the hill, and you think, you know, one day, if I work really hard, I could live in that mansion. In Ireland, people look up at the guy in the mansion on the hill and go, one day, I'm going to get that bastard. It's a different mind-set. KING: I'll say.
http://transcripts.cnn.com/TRANSCRIPTS/0212/01/lklw.00.html

[mheslep]

This wasn't the study I was looking at, but it is a meta analysis of the energy/GDP correlation of 88 countries.
As I said above:
It may be that energy production and GDP is more closely correlated in developing countries like China, which strikes me as intuitive, but I doubt the correlation holds very tightly in developed countries (i.e. how many yachts can one water ski behind?).That MPRA paper mixes in, for example, The Congo with the USA. I'm curious about the breakout.

The authors of that MPRA paper also cite other conflicting studies, e.g.:
One of the first studies was by Kraft and Kraft (1978). They use data for the
USA for 1947-1974 to study the causal relationship between gross energy consumption and GNP. They find uni-directional causality flowing from GNP to energy. Their conclusion is that energy conservation would not adversely affect GNP.

[mheslep]

OK, cherry-picking the outlier,
It would more useful I think to stick with author's description of the cases:
Following a critical review of the literature, included in this study, three cases were adopted. CASE 1 and CASE 3 being lowest and highest recent estimates, respectively, and CASE 2 being author’s best guess based on the information available.A high side estimate is not the same thing as an outlier.

we still have a story where fossil fuel energy falls off the cliff circa 2020, plummeting ~100 EJ/yr. So it is not a gentle linear decline rate out to 2100 but an energy plunge from 2020 to 2050 (co-inciding with peak population of course).I'd like to avoid mixing the hyperbole (cliff, plunge) with a discussion of the results of the study. Can we stick to the numbers therein? In case 3 between 2020 and 2050 Mohr shows a decline of approximately 3 EJ/yr. Cases 1 and 2 show a slightly steeper decline in that period, starting a few years sooner. If we agree so far, then it seems to me the interesting question becomes is replacing this loss rate feasible? If the US share of the decline is say 1 EJ/yr then it appears to me that via some combination of the replacement scenarios I put forth above (http://www.physicsforums.com/showpost.php?p=2810804&postcount=25) that replacing that loss rate is feasible.

And then things level out a bit for the next 50 years - based on the one huge compensating factor of shale oil.

So your optimism rests on the US being willing to dig up its backyard when the time comes? Is this what you are saying?<shrug>I suggest that you are conflating two issues here (and above) that simply leads to confusion: the first being political barriers, and the second is what fossil reserves are economically retrievable over time (the subject of Mohr's thesis). Granted both are important, but mixing them up leads to errors in my view.

Also, I don't know that open pit digging is required for shale oil recovery. It appears in-situ techniques are possible.
http://www.shell.us/home/content/usa/aboutshell/projects_locations/mahogany/technology/
http://en.wikipedia.org/wiki/Shell_in_situ_conversion_process
http://www.nypost.com/p/news/opinion/opedcolumnists/item_6mUUAG1W7YrQDbbKn8M2WP/1

[Office_Shredder]

That's tripled after inflation. It says so right on the side bar of the graph that all the numbers are adjusted for parity with the 2005 dollar value.

Woops, I missed that. My bad... I thought it would be pretty weird for GDP to decrease so dramatically after inflation was included

[mheslep]

An update -

One EJ/yr (1e18 J/yr, ~32 GW-yr), possible non-fossil equivalent replacements:

Nuclear: 30 AP1000 (http://en.wikipedia.org/wiki/AP1000) reactors running at the US average ~93% capacity factor (or 15 of the common two reactor plants), plus transmission.
-
Wind Turbines: 32 times the one year increase in Texas wind capacity seen in 2007-2008 (2.76 GW peak) (http://www.windpoweringamerica.gov/wind_installed_capacity.asp) at 37% capacity factor ( or 32 * 1850 1.5 MW wind turbines), plus transmission.
-
Conservation: A 3.5% increase across the board cut in US electrical generation via load efficiency, generation efficiency, or both. (assuming a 900GW(e) average US electrical load)
-
Conservation: A 2% across the board cut in US petroleum usage through increased efficiencies such as higher vehicle mpg, or migration to electric vehicles (1 EJ = 167 million bbls oil, US 2008 consumption = 7080 million bbl/yr (http://www.eia.doe.gov/energyexplained/index.cfm?page=oil_home#tab2))
-
Solar PV: 20 by 20 mile solar PV farm, 192 GW peak (225 W/M^2 mono-crystalline silicon panels, 1/6 capacity factor).

[apeiron]

The study doesn't discuss them, so any discussion of them stemming from the study is essentially just idle speculation.


You think that is a rational statement?

Just say this study is valid (and you are not disputing that yet) then the likelihood of peak fossil fuels in seven years is not really worthy of further comment???

We all go ho hum. Technology will always find a way round things?


Will the economy collapse? Will we adapt by building nuclear plants and buy electric cars? The study contains no discussion of those issues whatsoever.

Broadly there are two responses - the technological and the social. One says a way will be found to continue business as usual despite peak fuels, peak population and global warming. The other says ecological limits will actually bite and growth-predicated economics will collapse. This will require deep social change - energy descent, relocalisation, etc.

I am quite happy to consider the arguments for both. But the issue for this OP is really about timescales. What do we actually know about peak fossil fuels? This study impressed me. If you have good reasons to doubt its timescales, then please state them.

[russ_watters]

You think that is a rational statement? Certainly. Just say this study is valid (and you are not disputing that yet) then the likelihood of peak fossil fuels in seven years is not really worthy of further comment??? I didn't say it wasn't. What I said was that speculation about "dire" consequences doesn't exist in that study and doesn't have any evidence behind it. It is pure speculation and is worth very little.

[apeiron]

It is pure speculation and is worth very little.

And that reads like evasion born of cognitive dissonance. If you can provide some kind of technical road-map study that looks at energy alternatives and their EROEIs, then that would be a contribution. At least mheslep is attempting to look at what might plug the gap.

For me, responses like biofuels and deep water drilling are evidence of how difficult it actually is to find technical outs. A nuclear rennaissance is easy to dream about, but harder to see happening.

There is in fact huge shortsightness on both sides concerning these kinds of fixes. The greenies and nimbies are effectively opposing even wind turbines as they don't like the view being messed up. They will be an effective brake on nuclear for sure.

This is where the speed of the peak is the issue. It is not just about technical fixes, but about the ability even to take rational decisions in societies with short-term mindsets.

What you call "pure speculation" I call taking the future seriously.

[Jack21222]

If the US share of the decline is say 1 EJ/yr then it appears to me that via some combination of the replacement scenarios I put forth above (http://www.physicsforums.com/showpost.php?p=2810804&postcount=25) that replacing that loss rate is feasible.


You're completely ignoring costs. The question isn't whether we can replace the energy, but at what cost? You're also completely ignoring the rest of the world. The United States doesn't exist in a vacuum.

The price of oil is due to shoot up dramatically in the coming decades due to the combination of flat or declining production coupled with increasing demand as more of China and India get "developed," along with other such countries. Even if the United States is able to make a successful conversion away from oil in the next couple decades, how about India and China? Will they have the resources to reconfigure their economies? What happens to the world economy when oil is $300 per barrel?

[Office_Shredder]

The US regains its manufacturing jobs

[mheslep]

You're completely ignoring ...No, I'm focusing on one part of a very large problem at a time, a part I happen to have some familiarity with. That's how one generally solves problems. The costs of most of the replacements are roughly known. Meanwhile, introducing nationalistic 'what about the rest of the world' lines derails the discussion.

[mheslep]

Technology will always find a way round things?
Visibly it has.

[apeiron]

Visibly it has.

Easy to say. But I guess many decades of close exposure to the gap between the hype and the reality makes me less confident. AI, fusion, nano-technology, SDI, space travel, neutropics. So many sci fi claims with rather pedestrian outcomes.

A fossil fuel replacement strategy has to match the EROEI and also the projected consumption curve of the world for it to be business as usual.

If the EROEI is markedly worse (and you have to factor in things like conversion costs of everyone going electric cars or whatever), or the consumption curve (GDP burn) is flatter or declining, then you will have to have a strategy for "socio-political" redesign as well.

[apeiron]

An update -

One EJ/yr (1e18 J/yr, ~32 GW-yr), possible non-fossil equivalent replacements:
[LIST]
Nuclear: 30 AP1000 (http://en.wikipedia.org/wiki/AP1000) reactors running at the US average ~93% capacity factor (or 15 of the common two reactor plants), plus transmission.


What your analysis neglects is...

a) the need to replace existing ageing reactors, most coming to the end of their 40 year lives.

b) BAU depends on rising energy consumption - standard projections are that energy consumption globally will double by 2050 (or quadruple without expected energy efficiency measures).

http://europa.eu/rapid/pressReleasesAction.do?reference=MEMO/07/2
http://www.worldenergy.org/documents/scenarios_study_online.pdf

So the equation for nuclear reactors would be replacements + those needed to offset fossil fuel decline + those needed to allow for BAU energy consumption = (some unfeasible number :tongue2:).

Say half the energy gap could be filled by biofuel and renewables, then how many reactors does this require?

The world figures, rather than just the US figures, do matter. Because if say, only the US had a technical out, then it could expect both less fossil fuel from the rest of the world (so would require more nuclear/alternatives) and also more trouble from the rest of the world (which is hardly conducive to BAU).

It would also be good if you could stick to case 2 analyses rather than case 3 because you have given no reasons for preferring the high side projections other than your cognitive bias.

And this means not the alternative scenarios too, which build in unrealistic coal dynamism. (Case 3 builds in unrealistic shale oil).

But anyway, on your preferred case and a presumption of 30 reactors to produce 1Ejy, the global equation would seem to be 15 replacements + 90 fossil fuel gap pluggers + 190 BAU enablers = ~300 reactors being built a year between 2010 and 2050.

Time to buy shares in Ariva and Toshiba!!

But of course, how realistic is it that we could replicate the world's current total installed capacity every year for the next 40?

(The scale up factor required for the other half of the post-peak BAU equation - biofuels and renewables - is of course way more horrendous).

[Jack21222]

Meanwhile, introducing nationalistic 'what about the rest of the world' lines derails the discussion.

Isn't "introducing the rest of the word" the exact opposite of "nationalistic?" Are we using two different versions of the English language?

[mheslep]

But anyway, on your preferred case and a presumption of 30 reactors to produce 1Ejy, the global equation would seem to be 15 replacements + 90 fossil fuel gap pluggers + 190 BAU enablers = ~300 reactors being built a year between 2010 and 2050.
I don't believe that follows. Could you clarify how you arrived at the replacements and the new energy demand numbers?

First, the current world wide installed reactor base is 439, average age 26 (http://www.iaea.org/cgi-bin/db.page.pl/pris.reaopag.htm), with 50 currently under construction (http://www.world-nuclear.org/info/inf17.html); replacing all operating reactors over the next 40 years is 11 per year. Also, I suggest renovating an old nuclear plant (versus simply shuttering it) with an existing license to operate on an approved site is a far less expensive and difficult task than building a brand new plant from scratch. Thus adding counts of replacements together with new plants and using the sum as figure of metric to gauge feasibility is at least partially flawed approach.

Second, regarding new demand, Mohr says he already incorporates some kind of new demand model in his estimates for fossil fuel production. So it appears that 1) declines from some future peak fossil production point that is a function of demand, and 2) new future demand have at least some overlap in composition, and thus counting them separately would be double counting at least in part.

Third, the One EJ/year equivalents list I suggested above are simple energy balance metrics, i.e. so many solar panels produces and EJ/yr. I included no prescription saying one type must be used to the exclusion of the others. The world is free to pick and choose any combination non-fossil sources, as of course it will.

[apeiron]

First, the current world wide installed reactor base is 439, average age 26 (http://www.iaea.org/cgi-bin/db.page.pl/pris.reaopag.htm), with 50 currently under construction (http://www.world-nuclear.org/info/inf17.html); replacing all operating reactors over the next 40 years is 11 per year. Also, I suggest renovating an old nuclear plant (versus simply shuttering it) with an existing license to operate on an approved site is a far less expensive and difficult task than building a brand new plant from scratch. Thus adding counts of replacements together with new plants and using the sum as figure of metric to gauge feasibility is at least partially flawed approach.


OK, call it 10 a year.


Second, regarding new demand, Mohr says he already incorporates some kind of new demand model in his estimates for fossil fuel production. So it appears that 1) declines from some future peak fossil production point that is a function of demand, and 2) new future demand have at least some overlap in composition, and thus counting them separately would be double counting at least in part.

The point of the study is how little the peak changes with various demand and supply considerations. And the 90 a year was based on your suggested figure.

But let's be reasonable and halve it - biofuels and other renewables can take up any of the slack.


Third, the One EJ/year equivalents list I suggested above are simple energy balance metrics, i.e. so many solar panels produces and EJ/yr. I included no prescription saying one type must be used to the exclusion of the others. The world is free to pick and choose any combination non-fossil sources, as of course it will.

I've already halved the nuclear contribution in the 190 figure I quoted - accepting scenarios like the Shell study where biofuels and other renewables take up the slack.
(p17 - http://www-static.shell.com/static/public/downloads/brochures/corporate_pkg/scenarios/shell_energy_scenarios_2050.pdf)

Current world energy consumption is ~470 Ejy (http://en.wikipedia.org/wiki/World_energy_resources_and_consumption#Nuclear_pow er_2).

Consumption would be double this by 2050 given BAU and good efficiencies.
(http://www.worldenergy.org/documents/scenarios_study_online.pdf)

OK, allow peak fossil fuels to be 2020 and the peak to be 520 Ejy, that will mean that on top of new energy to plug the post-peak decline, there will also have to be 420 Ejy extra capacity in 2050.

Let half of that be nuclear reactors - 210 Ejy.

So if 30 reactors = 1 Ejy (as you said) then that is an extra 6300 reactors by 2050.

That comes to a build rate of 158 a year. (A lesser figure as I've been even more generous with the assumptions).

So 10 + 45 + 158 = 213 new reactors world wide every year to give us BAU (presuming nuclear carries only half the load and the contribution can be matched by other non-fossil fuel sources).

That is four new reactors every week. And about $6 billion in capital cost (or probably a lot more as fossil fuel peaks and energy costs soar).

Sounds like a tall order to me. Can you supply any evidence to suggest the world can build this many reactors and also manage the waste? Peak uranium would also be a consideration at this level of building of course.

[mheslep]

...And the 90 a year was based on your suggested figure.
Yes I know the 90 reactors are for gap plugging in fossil fuel decline based on my estimate of 30 reactors per 1 EJ/yr replacement. My second question was about your figure of 190 (6.3 EJ/yr) Buisiness-As-Usual new demand reactors. What is the basis of that figure? Edit: appears you address that below, thanks.

I've already halved the nuclear contribution in the 190 figure I quoted - accepting scenarios like the Shell study where biofuels and other renewables take up the slack.
(p17 - http://www-static.shell.com/static/public/downloads/brochures/corporate_pkg/scenarios/shell_energy_scenarios_2050.pdf)Before I plough through that 52 pgr, what exactly are saying that the Shell scenario provides as relevant to your point? Could you quote a relevant passage?
Current world energy consumption is ~470 Ejy (http://en.wikipedia.org/wiki/World_energy_resources_and_consumption#Nuclear_pow er_2).Agreed (you meant this top link I believe (http://en.wikipedia.org/wiki/World_energy_resources_and_consumption))

Consumption would be double this by 2050 given BAU and good efficiencies.
(http://www.worldenergy.org/documents/scenarios_study_online.pdf)Ok, I don't know about the 'BAU' and efficiency qualifiers but I agree a world wide doubling of energy demand by 2050 is in line at least with some of US EIA's Outlook predictions, most of that increase coming from the developing world.

OK, allow peak fossil fuels to be 2020 and the peak to be 520 Ejy, that will mean that on top of new energy to plug the post-peak decline, there will also have to be 420 Ejy extra capacity in 2050.That's my point above - you are double counting there by at least 50 EJ/yr (110 EJ/yr in case 3) as the fossil peak already counts increased demand.

Let half of that be nuclear reactors - 210 Ejy.

So if 30 reactors = 1 Ejy (as you said) then that is an extra 6300 reactors by 2050.

That comes to a build rate of 158 a year. (A lesser figure as I've been even more generous with the assumptions).

So 10 + 45 + 158 = 213 new reactors world wide every year to give us BAU (presuming nuclear carries only half the load and the contribution can be matched by other non-fossil fuel sources).To avoid double counting let's simplify: In 2050 EIA predicted demand is ~940 EJ/yr.* Then, Mohr's 2050 fossil production is ~480 EJ/yr (case 3), so the 2050 demand deficit from fossil decline is 460 EJ/yr. If nuclear is tasked to cover half of that as you propose, then we have 230 EJ/yr * (30 reactors/EJ/yr) over 40 yrs is 173 reactors per year world wide, plus 10 replacements per year.

[...]Can you supply any evidence to suggest the world can build this many reactors and also manage the waste?
http://www.world-nuclear.org/info/inf17.html
It is noteworthy that in the 1980s, 218 power reactors started up, an average of one every 17 days.
http://www.world-nuclear.org/info/inf17.html
Regarding cost for nuclear, this varies considerably by country, another reason why addressing the problem world wide is complicated. In the US yes nuclear capital costs appear to be $5-7 / W(e). However China is throwing up PWBs for $1.6/W(e), or $1.6B for a one GW(e) reactor (as pointed out by signerro (http://www.physicsforums.com/showpost.php?p=2115378&postcount=115)r)
The two generators at Tianwan are expected to produce 2.12 MW each year for east China, which boasts the fastest economic growth in the country.

The construction of Tianwan Nuclear Power Station began in 1999 and has cost 26.5 billion yuan (3.3 billion US dollars). Both generators feature Russian pressurized-water technology.
http://news.xinhuanet.com/english/2006-05/13/content_4542917.htm

Peak uranium would also be a consideration at this level of building of course.Eh, peak production of Uranium isotope 235 maybe, otherwise no there's no peak production of fissionable fuels anywhere near 2100.

The International Atomic Energy Agency estimates the remaining uranium resources to be equal to 2500 ZJ. (i.e. 2500 years of 1000 EJ/yr production)

*I'm highly sceptical that real demand will reach that high coming from the developing world, that instead efficiencies such a solar water heating, high efficiency lighting, and more efficient aviation (e.g. 787) will leap frog the more wasteful technologies just as the cell phone leap frogged land telco lines in the developing world. But for now I'll accept the doubling prediction of 940 EJ/yr in 2050.

[apeiron]

To avoid double counting let's simplify: In 2050 EIA predicted demand is ~940 EJ/yr.* Then, Mohr's 2050 fossil production is ~480 EJ/yr (case 3), so the 2050 demand deficit from fossil decline is 460 EJ/yr. If nuclear is tasked to cover half of that as you propose, then we have 230 EJ/yr * (30 reactors/EJ/yr) over 40 yrs is 173 reactors per year world wide, plus 10 replacements per year.

OK, BAU = business as usual. ie: continued GDP growth and energy demands basically unchanged apart from significant efficiency moves (by 2050, consumption merely doubles rather than quadrupples).

And it seems you will settle for 183 new reactors a year to cover half the peak fossil fuel gap (which is still a low side case 3 estimate based on Mohr's study).

So that is 183 reactors a year building programme compared to the 21 a year achieved during the 1980s. Almost an order of magnitude increase in building maintained over four decades (if it started this year).

This would be a reactor every two days.

The rosiest projections of the industry lobbiest is "a realistic estimate of what is possible might be the equivalent of one 1000 MWe unit worldwide every 5 days."

http://www.world-nuclear.org/info/inf104.html

[aquitaine]

Easy to say. But I guess many decades of close exposure to the gap between the hype and the reality makes me less confident. AI, fusion, nano-technology, SDI, space travel, neutropics. So many sci fi claims with rather pedestrian outcomes.

A fossil fuel replacement strategy has to match the EROEI and also the projected consumption curve of the world for it to be business as usual.

If the EROEI is markedly worse (and you have to factor in things like conversion costs of everyone going electric cars or whatever), or the consumption curve (GDP burn) is flatter or declining, then you will have to have a strategy for "socio-political" redesign as well.



Ah yes, the grand old EROEI misconception (http://peakoildebunked.blogspot.com/2005/08/4-eroei-misconceptions.html). Fortunately, we have things like electric cars (which are coming out this year and next year) which will allow us to still go to work while avoiding taking the bus. And to make that electricity, we have the most efficient and abundant source of energy ever discovered: nuclear fission. Doomed? Hardly.


I find it interesting you can come onto a science and technology forum and say technology wont find a way around things. Peak oil is very much a problem of technology, and so therefore it has technological solutions.

[apeiron]

I find it interesting you can come onto a science and technology forum and say technology wont find a way around things. Peak oil is very much a problem of technology, and so therefore it has technological solutions.

Thanks for the link to the blog "debunking EROEI". It really is very funny. A top source. :smile:

Screw the earth. It's like the egg we hatched out of. We suck its resources dry, and then we step out of the nest and fly into the wild black yonder

We will never run out of hydrocarbons or energy, because they are the basic building blocks of the universe, and the universe is infinite.

Who says a world production peak means US consumption has to go down? That's not necessarily true. Maybe world production starts declining, and US consumption doesn't, or even goes up. After all, the US is rich, and the schoolyard bully.
Obviously this situation can't go on forever, but it's certainly a good stopgap, and I don't see anything to really prevent it from happening.

The guy is clearly an economic genius :rofl:.

Even when using oil to recover oil, money can still be made with an EROEI of 1 if inflation is high enough. Oil projects take a long time. You make all the oil investments when oil is at, say, $40, and sell the product when oil is at $80. The net energy gain is 0. The net monetary gain is %100, minus the rate of inflation. Depending on the economic climate, this could even work with an EROEI<1.

how would you even *know* if you had crossed into an EROEI<1 ? No one is doing the energy acccounting, and due to the entrenched resistance of traditional economists, no one will be. So why would production stop due to a variable that no one is calculating?

Now suppose you have a reserve of oil, and using it, you can produce another reservoir of the same size, would you do it? Hubbert would say no, it's irrational. You might as well just consume the oil, or hold and sell it later because it amounts to the same thing. But that is incorrect because there are beneficial side effects to producing, even though the EROEI=1. If you produce, lots of people can remain employed in the production effort, and get paid and eat, while you use up the first reservoir. And when it's exhausted, you have a whole new reservoir to use or consume, so you haven't lost anything.

Your "source" just gets better and better.....

Production with an EROEI of 1 or less can also be rationalized through accounting chicanery. Subsidies and tax breaks are good examples. You socialize the input energy costs, and privatize the output energy profits. Here's a more extreme example: You live in a last-dregs world where oil is virtually non-existent, and worth an astronomical sum. So you capture some people, and work them to death pumping out a barrel of oil from an old well. You don't feed or care for them in any way, so you have minimal costs, and in the end you get a priceless barrel of oil. In short, it's rational to produce oil even with an EROEI of 0.001 if you can force or trick someone else into paying the costs.

Gosh Aquitaine, I just hope you were in on the joke.....

[aquitaine]

Unlike you, he knows what he's talking about.

[apeiron]

Unlike you, he knows what he's talking about.

No, no. If you want to question my conception of EROEI issues, then you need to link to some credible research and not this satirical nonsense.

[brainstorm]

I have been trying to compare the cost of expanding solar to rising fossil-fuel costs. Assuming oil and coal prices keep rising, the cost of solar should decline relative to non-renewables. However, solar users who feed-in to their grid are wanting to receive the retail rate in exchange for fed-in energy. This means that there is no allowance for the utility company itself. The question is will utility companies charge more for oil/coal-based power in order to buy-in excess solar for the grid, or will the high costs and declining demand for non-solar drive the utility companies to bankruptcy?

[apeiron]

I have been trying to compare the cost of expanding solar to rising fossil-fuel costs. Assuming oil and coal prices keep rising, the cost of solar should decline relative to non-renewables. However, solar users who feed-in to their grid are wanting to receive the retail rate in exchange for fed-in energy. This means that there is no allowance for the utility company itself. The question is will utility companies charge more for oil/coal-based power in order to buy-in excess solar for the grid, or will the high costs and declining demand for non-solar drive the utility companies to bankruptcy?

I think the point at the heart of your question is about the big possible efficiency gain that would be possible with relocalised energy production. Power has been about big companies/big government building the infrastructure. Now we need a scalefree model of production which would maximise efficiency. It would be good for homescale production to be able to use the national grid as its battery, as actual batteries are a bad idea.

In countries like Germany, farmers have been paid a premium for electricity generated by wind turbines on their land. Hence wind is flourishing in Germany. A subsidised start quickly overcame the NIMBY factor.

In my own country (New Zealand), you can feed power into the national grid. But you get less for it when you later buy it back. So effectively you are penalised.

So I would say there is a natural future in national power grids becoming the storage battery for homescale energy production. But you have two key problems with this happening.

The first is that the existing monopolies have to be made to open up (which is possible where the state is in charge, much harder in privatised systems).

The second is the issue of fossil fuel pricing. Unless there is some imposed pricing mechanism that pushes up the cost of fossil fuel to what it should be (pricing in its scarcity, its carbon footprint, etc) then it will continue to be under-priced and so undercut renewable alternatives.

This is the problem for people who say "technology solutions will save us". The technology may exist, but getting it in place requires some rather serious socio-political-economic engineering. Those of us following progress are alarmed at how little progress there is on behaviour change.

We know that denial is the first stage of grief. Denial is what we mostly still hear from people.

[brainstorm]

Solar energy is wonderful, but the point I was trying to raise is that for people to sell their excess power onto the grid at the same price they pay for it requires that someone else pay them at that rate PLUS the costs of maintaining the grid, as well as administration costs, etc.

So, ultimately I think it's going to come down to a question of competing labor costs. 1) How much do solar producers expect per kwh and 2) how much are fossil fuel producers willing to take per kwh generated? Solar may end up costing more than fossil fuel only because the people supplying it are indexing their price against what they pay for electricity, whereas the fossil fuel prices are based on supply and demand.

Eventually, if enough people invest in solar panels to make feed-in competitive, there will be supply-side competition and the cost paid to solar-cell owners will go down. However, the question is whether this low price will be sufficient to motivate private individuals to buy and maintain solar systems. It may turn out that big companies undercut private individuals eliminating home-based solar collectors.

At that point, my question would be what was gained economically by switching to solar, if it just becomes another profit industry the same as fossil fuels. Granted the ecological benefits are great, but it's not like people are going to be any more free economically than they are now, even though sunlight is 100% free. See the problem?

[apeiron]

At that point, my question would be what was gained economically by switching to solar, if it just becomes another profit industry the same as fossil fuels. Granted the ecological benefits are great, but it's not like people are going to be any more free economically than they are now, even though sunlight is 100% free. See the problem?

Afraid that I don't really understand the point you are trying to make.

What I was saying is that a key issue with alternatives is that if the power source is "everywhere" as it is with wind and sun, then it makes sense to create a system that can tap into it over all available scales. With electricity grids, this would not actually be that hard to do, although established interests might resist the change.

The "economic freedom" of people boils down to then getting the cheapest power for the longest time. Whether this is achieved by big monopolies or turbines and PV panels on every roof is not really a big deal is it?

[brainstorm]

The "economic freedom" of people boils down to then getting the cheapest power for the longest time. Whether this is achieved by big monopolies or turbines and PV panels on every roof is not really a big deal is it?

If economics was sane, I would say you're right. Unfortunately, though, I was trying to explain that people with solar cells are trying to feed-in power for a high kwh fee. This means those who buy from the grid will have to pay even more to fund the high solar costs PLUS the costs of infrastructure and administration.

Another way to put it is that people will have to pay the same amount of money to the utility companies to cover their infrastructure and administration costs AFTER investing in their solar system. PLUS, the price per kwh will go up as a result of how many less kwh are being bought by people living off their solar systems during the day.

So you're going to ultimately end up paying more for solar energy because the people working for the utility companies are going to want to keep making the same amount of money, along with the people who produce infrastructure, build buildings, etc. Either that or the economy has to be radically restructured to make life sustainable with significantly lower amounts of income.

[talk2glenn]

If economics was sane, I would say you're right. Unfortunately, though, I was trying to explain that people with solar cells are trying to feed-in power for a high kwh fee. This means those who buy from the grid will have to pay even more to fund the high solar costs PLUS the costs of infrastructure and administration.

This is a legitimate problem with net-metering generally, but is a policy, rather than market problem.

Power companies are required by federal law to buy back excess eletricity, at some rate. Exact policy varies state-by-state. At the market-end of the spectrum, states either allow the utility to contract with homeowners directly (setting a contract rate), or provide a legal wholesale rate (which is significantly lower than the market rate for the electricity, reflecting the fact that the utility maintains the grid).

Other states, however, require that homeowners be compensated at the utilities own market rate (the same rate the utility charges its customers for electricity draw). These policies make little economic sense; the homeowner does not have to pay for his share of the infrastructure, as you point out, and he does not have the overhead of grid maintenance. His only infrastructure costs are the initial PV installation, which was itself already heavily subsidized by the public utilities and the state. This means rates generally must go up to offset the added costs of paying the owners of solar setups at greater than market rates (if the power company and homeowner negotiated, the agreed upon price for the homeowners energy return would be significantly less than that charged by the power company itself), and effectively non-solar households are subsidizing solar households, a market distortion.

While unfortunate, it is not unique to electricity return. Even without these kinds of net metering policies, taxpayers generally are already subsidizing the installation of solar cells on homes, through federal and local programs.

[apeiron]

While unfortunate, it is not unique to electricity return. Even without these kinds of net metering policies, taxpayers generally are already subsidizing the installation of solar cells on homes, through federal and local programs.

Market mechanism are maximally efficient in theoru, but usually suffer from extreme short-sightedness in practice as only the immediate future is easy to see.

So it would be normal to subsidise behaviour that we want to encourage long-term. This is why public transport is subsidised.

Alternative energy needs subsidising for the same reason. Indeed, the situation is worse. Fossil fuels are priced too cheaply (in the longterm view). Yet the response to a price rise is economic contraction - which then reduces the demand and thus price. This is because production is based on longterm infrastructure investment. So the system is locked into an attractor that keeps fossil fuel prices artificially low and prevents a move to more expensive alternative energy infrastructure.

The relationship is well understood. And countries can make choices about how to break-out of the feedback loop.

[brainstorm]

Subsidizing solar systems, either though formal subsidies or buying excess energy they produce at retail rates, is a double-edged sword. Yes it promotes the installation of solar systems, but it also spoils the supply-market of solar-cell producers by making them accustomed to subsidized profit-levels. The question becomes whether the solar-cell industry will remain in business once subsidies are reduced or eliminated. Ironically, if solar growth is very successful, it will contribute to oil conservation, which will extend the life of oil as an available fuel. This in turn lowers demand and therefore the price of oil, which in turn makes it harder for solar to compete. Ultimately the question is whether solar cells will become so simplified and/or plentiful that they will be as easy to cultivate as, say, a lawn sprinkler system. Will people be able to go to a local hardware store and pick up the parts to set up or fix a solar system and, as such, will the industrial production of these parts become so massified as to render the parts as cheap as any other relatively meaningless mass-produced commodity, such as pvc and pvc fittings?

[talk2glenn]

Market mechanism are maximally efficient in theoru, but usually suffer from extreme short-sightedness in practice as only the immediate future is easy to see.

If this is true, why does it follow that the government would be more able to anticipate long term needs than the market? Is the future more easily foreseen by public than market forces? I would argue that the evidence strongly suggests the latter outdoes the former; the centrally planned Soviet Union could not anticipate long term needs for winter clothing in one of the most consistently cold regions on earth, while we take it for granted that there will always be enough milk on store shelves to go around, with little to no waste, despite dramatic fluctuations over both the short and long terms. Markets in fact have a harder time anticipating short-term demand than long-term, due to unforeseeable events (disasters, for example, but also apparently random fluctuations in short-term consumer preferences that are relatively stable over longer periods).

This is why public transport is subsidised.

Public transportation isn't subsidized because of an anticipated long-term growth in demand, but for precisely the opposite reason: the long-term demand trend has been negative.

As demand for public transport has gone down, it has become increasingly dependent on public subsidy to survive, because there is an excess in supply (which would tend to push prices down and eliminate weaker competitors, in a competitive marketplace, reducing supply and increasing demand until a new equilibrium is met).

So the system is locked into an attractor that keeps fossil fuel prices artificially low and prevents a move to more expensive alternative energy infrastructure.

Fuel prices are not kept artificially low; the market rate is a product of supply and demand. If it is the case that supply of cheap fuels is decreasing irrecoverably, while demand for energy is increasing, then these prices will rise until alternative sources become viable.

The question becomes whether the solar-cell industry will remain in business once subsidies are reduced or eliminated.

Clearly, if subsidies were not offered, demand for solar cells would decline, which would lead to short-term price falls. This would have the effect of eliminating the weakest competitors in the industry. The industry would survive, but it would be composed of a smaller number of companies.

This in turn lowers demand and therefore the price of oil, which in turn makes it harder for solar to compete.

This is only true for the short-term. In the long term, oil companies will respond by reducing supply, and price levels will rise again. The new equilibrium level in the long-term may or may not be lower than the initial price.

[aquitaine]

Subsidizing solar systems, either though formal subsidies or buying excess energy they produce at retail rates, is a double-edged sword. Yes it promotes the installation of solar systems, but it also spoils the supply-market of solar-cell producers by making them accustomed to subsidized profit-levels. The question becomes whether the solar-cell industry will remain in business once subsidies are reduced or eliminated. Ironically, if solar growth is very successful, it will contribute to oil conservation, which will extend the life of oil as an available fuel. This in turn lowers demand and therefore the price of oil, which in turn makes it harder for solar to compete. Ultimately the question is whether solar cells will become so simplified and/or plentiful that they will be as easy to cultivate as, say, a lawn sprinkler system. Will people be able to go to a local hardware store and pick up the parts to set up or fix a solar system and, as such, will the industrial production of these parts become so massified as to render the parts as cheap as any other relatively meaningless mass-produced commodity, such as pvc and pvc fittings?


Solar has other more fundemental problems that prevent it from becoming a primary source of baseline power. For example, it doesn't work at night.

[JaWiB]

Subsidizing solar systems, either though formal subsidies or buying excess energy they produce at retail rates, is a double-edged sword. Yes it promotes the installation of solar systems, but it also spoils the supply-market of solar-cell producers by making them accustomed to subsidized profit-levels. The question becomes whether the solar-cell industry will remain in business once subsidies are reduced or eliminated. Ironically, if solar growth is very successful, it will contribute to oil conservation, which will extend the life of oil as an available fuel. This in turn lowers demand and therefore the price of oil, which in turn makes it harder for solar to compete. Ultimately the question is whether solar cells will become so simplified and/or plentiful that they will be as easy to cultivate as, say, a lawn sprinkler system. Will people be able to go to a local hardware store and pick up the parts to set up or fix a solar system and, as such, will the industrial production of these parts become so massified as to render the parts as cheap as any other relatively meaningless mass-produced commodity, such as pvc and pvc fittings?
Why should the subsidies be reduced or eliminated? Subsidies for fossil fuels are still around.

[JaWiB]

Solar has other more fundemental problems that prevent it from becoming a primary source of baseline power. For example, it doesn't work at night.

Which is why people are looking into energy storage solutions like hydrogen. It isn't an insurmountable problem

[brainstorm]

I was in the middle of a detailed response message when the power went out and I lost my work. Ironic that it happened while I was posting about energy developments! Anyway, the main issue, imo, is that people can't expect that current consumption patterns are going to magically cause solar power, fossil fuel supply, or any other aspect of energy resourcing to behave in ways they expect it to. People act as if the energy sources have to meet their cultural expectations instead of the other way around. If solar doesn't work it night, it may be that people are going to have to adapt their cultural patterns to go without electricity at night. It may not be necessary to do this right away or all at once, but it makes more sense to me that if you estimate that eventually it will be inevitable that you would rather transition slowly than wait for the sh*t to hit the fan, so to speak.

Currently, I believe the political-mechanical issue is whether free-markets are suited to adapt to energy production and consumption needs for the future. Presumable with valid knowledge about the future they would be, but the problem is that market interests themselves exert influence on future-knowledge in a way that suits short-term profit-motives and consumer-habits. In short, consumers are willing to pay to be told what they want to believe, even if that means making the disaster worse in the long run. Many people simply don't believe there's any disaster even coming - that it is just a trick on the part of people who want to generate cultural change.

The biggest question is whether government should allow solar developments to get priced out of the market, or whether some combination of subsidies and business-model intervention could push the solar-energy industry in the direction of making technologies more accessible, affordable, and therefore widespread. Of course, if existing energy-interests decide that growth of solar is going to interfere with their ability to maintain infrastructure with a narrower customer base, they will probably focus on preventing solar from gaining market share, just because they need the money to continue funding their operations, which they have a stake in maintaining.

[talk2glenn]

Many people simply don't believe there's any disaster even coming - that it is just a trick on the part of people who want to generate cultural change.

There is no "disaster". This is a political myth promoted by interested parties who regard petroleum and other carbon fuels as "bad", and so-called alternatves as "good". If there were any impending threat of a collapse in global oil supplies, the price of oil (which reflects both current supply/demand and anticipated future supply/demand, through the futures markets) would be significantly higher than it is currently. Even with recent inflation, which is a product of market distortion through public policy (war, energy subsidy, etcetera) and not fundamental changes in supply/demand (the increased demand from China is more than offset by increased production), refined oil remains extremely cheap, relatively speaking. This is because it is extremely plentiful.

Global proved oil reserves have grown every year since they began collecting the data using current methodology at the turn of the century. This means that we are finding new, economically exploitable oil (at current price and technology levels) faster than we are drilling it up. Or, another way of putting it is to say that the amount of oil we know of in the earth TODAY is NO LESS THAN it was at the BEGINNING of the industrial cycle in the late 1800's.

Despite arguments to its "unsustainability", the engineering trends suggest that the rate of technology and productivity growth is more than enough to offset the drainage of known fields, with the effect being that oil is practically an inexhaustible resource, even if that is not theoretically accurate.

The biggest question is whether government should allow solar developments to get priced out of the market, or whether some combination of subsidies and business-model intervention could push the solar-energy industry in the direction of making technologies more accessible, affordable, and therefore widespread.


It is never the case that public subsidy causes an industry, any industry, to become more "affordable". It may be true that public subsidy increases accessibility in the short term, but this is at the expense of the long term (the short term increase in demand must ultimately be met by a long term reduction in that demand, to achieve balance of payments equilibrium - the debt government accrused today through subsidy must be paid tomorrow through tax, if you will, though this is a crude and not always accurate metaphorical explanation). To exercise this point, consider the recent cash for clunkers program. The program subsidized the purchase of cars in the short term, but everyone acknowledge that this would mean a later-term decline in car sales, once the subsidies were eliminated (in effect, people who would have otherwise purchased their vehicle in a month purchased it today; net sales were unaffected, just the rate of sales). Subsidy advocates argue that, due to unforeseen market conditions, it is worth moving future demand to present demand, for political reasons.

As to affordability, a subsidy has the effect of maintaining an immediate market price level that is below the clearing, equilibrium price (through cash rebates to consumers or producers; the price paid by the consumer is less than the actual price, which includes the subsidy). This means that consumer demand will exceed producer supply, in the short, subsidized term. In response, producers will ALWAYS raise prices. In effect, subsidies have the effect of RAISING the short term price. This is economic reality. Again, subsidy advocates will argue this is a politically desirable outcome; they cannot argue that this will not happen. Again to exercise this point, consider college tuition rates. Do to heavy subsidy through the DOE guaranteed loans programs, demand for a college education outpaces supply, and the price of tuition increases much more rapidly than inflation.

[apeiron]

Despite arguments to its "unsustainability", the engineering trends suggest that the rate of technology and productivity growth is more than enough to offset the drainage of known fields, with the effect being that oil is practically an inexhaustible resource, even if that is not theoretically accurate.


Have you read the study that is the subject of this thread and can you please explain how it is an inaccurate summary of actual known reserves and consumption trends?

You say:

Global proved oil reserves have grown every year since they began collecting the data using current methodology at the turn of the century. This means that we are finding new, economically exploitable oil (at current price and technology levels) faster than we are drilling it up.

Can you please supply the references for that statement?

[Proton Soup]

there is a huge amount of methane hydrate ice at the bottom of the sea. i find it hard to believe that we won't find a way to harvest it as soon as that becomes profitable. of course, that is not infinite, either (despite being continually produced biologically), but it would certainly buy more time.

[apeiron]

Fuel prices are not kept artificially low; the market rate is a product of supply and demand. If it is the case that supply of cheap fuels is decreasing irrecoverably, while demand for energy is increasing, then these prices will rise until alternative sources become viable.


If you want to talk about subsidies and free markets, you might want to consider this first...

IEA analysis that will be presented in the World Energy Outlook (WEO) 2010 -- to be released in November -- reveals that fossil fuel subsidies are much higher than previously thought. In 2008, fossil fuel consumption subsidies rose to USD 557 billion, up from USD 342 billion the previous year. Phasing out such subsidies would send a price signal to create incentive for more efficient use.

http://www.worldenergyoutlook.org/subsidies.asp

[mheslep]

... These policies make little economic sense; the homeowner does not have to pay for his share of the infrastructure, as you point out, and he does not have the overhead of grid maintenance. Also, unless the residential solar is heavily cleaned up by batteries, the power quality is lousy (large variation on a time scale of seconds). As more and more solar comes online, this is likely to become a problem for the utilities.

[mheslep]

Solar has other more fundemental problems that prevent it from becoming a primary source of baseline power. For example, it doesn't work at night.Clearly approaches like solar thermal (http://en.wikipedia.org/wiki/Andasol_Solar_Power_Station)'work' technically at night. The economics of the storage are the question.

[Argentum Vulpes]

Solar Thermal is one possibility for night time power, hydrogen is another way to store excess power from solar power production for night time usage. The big problem that I see with that line of thought or any other "we need to develop technology" cures to make solar more in line with the western worlds expectations with the current power system is there is a tonn of "if" coming off of these plans.

Also solar panels require rare earth materials to do their thing, so do all semi conductors in consumer electronics. China is the worlds suppler of these materials and they have announced a cut back in global exports, due to rising internal needs. Because of laws of supply and demand the cost of these panels will rise, and so will other consumer electronics. Solar if brought to large scale will not drop in price but rise, and so will anything else with a semi conductor.

It is incredibly disappointing that so many people on this thread have discounted Nuclear power as the solution to the problem. It all but displaced oil as a power source in the USA (approximately 20% of current grid power). It replaced oil/diesel on subs and aircraft carriers in the USA navy, and replaced oil in the Russian ice breaker fleet. All cases where nuclear power has clearly demonstrated a clear path for displacing fossil fuel sources.

As for having a plan that has some "if" coming off of it, that will succeed. Replace coal boilers with nuclear tea kettles, and use the excessive heat to run a coal to liquid plant. Looking at USA reserves of coal that gives approximately 344 billion barrels of oil just inside of the USA borders. Sounds like a good reserve to me, and no one will loose their job, heck might even create some more.

[aquitaine]

Which is why people are looking into energy storage solutions like hydrogen. It isn't an insurmountable problem

Adding extra expense. Even with a storage solution you'd need to build over projected demand to compensate for the extra load, which feeds the other problem: fundemental inefficiency. The fundemental efficiency limit is the amount of solar energy per square meter, 27 watts if I recall correctly (though feel free to correct me). Now, in order to generate the gigawatts needed to power a city, you'd need huge amounts of land turned into solar farms, many may hectares worth. Instead of doing that, why not just go with the sensible solution and use nuclear? After all, many power plants have several reactors allowing them to get 3+ GW at just one site or more. Or do we really want to use MORE land, destroy more habitat than we already are? Land usage matters.

[mheslep]

Also solar panels require rare earth materials to do their thing, so do all semi conductors in consumer electronics.
No, rare earth elements are not required in traditional PV crystal panels. Chemically they are simple P-N junctions (http://en.wikipedia.org/wiki/Solar_cell#The_p-n_junction), and the typical dopants for silicon are listed here (http://en.wikipedia.org/wiki/Dopant).

Solar if brought to large scale will not drop in price but riseSolar PV panels are now produced at a rate of several gigawatts worth of panels per year, the price has continually dropped over time, dramatically so in the last two years. See, e.g.
http://i26.tinypic.com/2dab13s.gif
http://www.1366tech.com/v2/
The main cost in crystalline panels is the highly purified silicon required; methods of producing the silicon wafers have become increasingly efficient over time.

[Argentum Vulpes]

No, rare earth elements are not required in traditional PV crystal panels. Chemically they are simple P-N junctions (http://en.wikipedia.org/wiki/Solar_cell#The_p-n_junction), and the typical dopants for silicon are listed here (http://en.wikipedia.org/wiki/Dopant).

Now lets stop being disingenuous here. Yes the old generation one PV moncrystalline panels require no rare earth elements. However those panels are lucky to get 20% efficiency. Have to be in large heavy sheet configurations. Have to track the sun, and the hotter they get the efficacy of the panels drop off. There is a reason they are generation one panels, and labs are barking up the generation four tree.

Solar PV panels are now produced at a rate of several gigawatts worth of panels per year, the price has continually dropped over time, dramatically so in the last two years. See, e.g.
http://i26.tinypic.com/2dab13s.gif
http://www.1366tech.com/v2/
The main cost in crystalline panels is the highly purified silicon required; methods of producing the silicon wafers have become increasingly efficient over time.

Of course the cost of the panels are going to go down if it is artificially brought down by government subsidies. Also per your graph for the line to remain true there must be a 35% growth in solar power generation, and only 18% of that growth go into new based technologies. Also the production facilities must have an 18% capacity factor (CF) and rely on a 7% government subsidy. Sounds like a lot of restrictions to keep that graph true.

And for kicks and giggles lets look at how efficiently the largest large scale solar project vs largest nuclear power uses land. DeSoto Next Generation Solar Energy Center with a peak power output of 25 MW on 140 acres of land with a CF of 19.1%. So there is approximately 178 kW of electricity per acre 19.1% of the year. Palo Verde Nuclear Generating Station has a peak power output of 3,875 MW on 4,000 acres of land with a CF of 86%. So there is 800 kW of electricity per acre 86% of the year. So nuclear uses land 4.5 times more efficiently and dose it 4.5 times as long.

Nuclear power is hands down the most efficient way to produce power with current technologies. Solar is a nice idea that needs a tonn more research. In its current form solar power can not provide base load power now or in the foreseeable future.

[mheslep]

Now lets stop being disingenuous here.
Yes the old generation one PV moncrystalline panels require no rare earth elements. Exactly, I'm attempting to stop you from continuing to do so. You made a claim about rare earth elements limiting the supply of PV panels:
Also solar panels require rare earth materials to do their thing, so do all semi conductors in consumer electronics. China is the worlds suppler of these materials and they have announced a cut back in global exports, due to rising internal needs. Because of laws of supply and demand the cost of these panels will rise, and so will other consumer electronics
Provide a valid reference showing how mass produced PV (i.e. panels) require rare earth elements in amounts sufficient to drive up PV panel costs or retract the claim and move on. Hint: You're confusing thin film solar, some of which does use rare earth, and polycrystalline silicon panels, which does not, even the modern ones.
However those panels are lucky to get 20% efficiency.No, panels prior to 2000 yielded ~10-15%. Now, most panels mass produced panels hit ~18%, with a few at 20-22%.
Have to track the sun, and the hotter they get the efficacy of the panels drop off.Sun angle and temperature still impact the output of 2010 PV mass produced crystalline cells; for that matter, temperature impacts the performance of any P-N junction semiconductor.

Also the production facilities must have an 18% capacity factor (CF) and rely on a 7% government subsidy. Sounds like a lot of restrictions to keep that graph true.Capacity factor is not germane to PV manufacturing, but refers to the percentage of online operation time of a power source; for solar power this refers to the amount of time the PV produces equivalent rated power which depends of course on sunlight received, typically 1/5 to 1/6 of a 24 hr day, ie. 18%. The 7% figure is not a government subsidy, but the assumed interest rate on borrowed money, i.e. the discounted rate of future cash flows.

Regarding nuclear power, I haven't seen anyone dismiss it in this thread. Instead there has been discussion of how much nuclear could be built in a given time.

[JaWiB]

Adding extra expense. Even with a storage solution you'd need to build over projected demand to compensate for the extra load, which feeds the other problem: fundemental inefficiency.

You already have to build over projected demand, regardless of the energy source...

The fundemental efficiency limit is the amount of solar energy per square meter, 27 watts if I recall correctly (though feel free to correct me).

I think average insolation is in the hundreds of W/m^2

Now, in order to generate the gigawatts needed to power a city, you'd need huge amounts of land turned into solar farms, many may hectares worth. Instead of doing that, why not just go with the sensible solution and use nuclear? After all, many power plants have several reactors allowing them to get 3+ GW at just one site or more. Or do we really want to use MORE land, destroy more habitat than we already are? Land usage matters.
True, you would need a lot of surface area. But there also seems to be a lot of land available in various places. Solar farms aside, we also have plenty of parking lots and rooftops. It's hard to say how much infrastructure could cost, but I still think solar is one of the best options in the long-term.

As for nuclear, I'm not against it, but I've heard conflicting reports about the availability of fuel, overall costs (one speaker cited some project in France that went ridiculously over budget and wasn't completed on time), and it has the typical disadvantage that it uses up a lot of water.

[apeiron]

Nuclear power is hands down the most efficient way to produce power with current technologies. Solar is a nice idea that needs a tonn more research. In its current form solar power can not provide base load power now or in the foreseeable future.

A complete costing of nuclear is more complicated. For example, the waste has to go somewhere, which will do something to your land useage calculations.

But anyway, I think it is easily agreed that there needs to be a baseload system and other stuff slots in on top.

The major thing we are not yet set up to do is capture free energy at any scale which is most convenient. The public utility/private monopoly model distorts the market by favouring large scale energy projects. It is obviously better if, for example, the electricity grid was a two-way network that could function as a battery. So if I tiled my roof with PV panels, the excess would feed into the grid - where it might even be stored by pumping water back up into a hydrodam - and then I could take that electricity back at a later date at a similar rate.

Nuclear would have to be the big utility model of course. PV would be the consumer level probably. And wind could span the range.

The economic calculations are complex, but counting the cost of plugging new technology into old financial models of infrastructure is dumb. It is the new infrastructure that we are trying to imagine.

And the point of the OP is that we have less time than many imagine to get imagining and acting. If we wait for market forces, it will be too late as oil is not accurately priced as a commodity!

Scarce goods should have higher prices, but fossil fuels have been treated as a free lunch (where I would not automatically disagree that nuclear has been over-priced by the market in terms of its dangers and capital costs - I am just wary because the industry has been in large part justified by a desire for bombs).

[mheslep]

The fundemental efficiency limit is the amount of solar energy per square meter, 27 watts if I recall correctly (though feel free to correct me).


I think average insolation is in the hundreds of W/m^2


1366 W/m^2 (http://en.wikipedia.org/wiki/Insolation) is the mean power density striking the earth's upper atmosphere; 1000 to 1100 W/m^2 reaches the surface at sea level at mid day in lower latitudes. Then solar PV crystalline panels convert to electricity at ~20% in rated conditions, producing on the order of ~200 W(e)/m^2.

[mheslep]

.... and it has the typical disadvantage that it uses up a lot of water.So do many solar thermal systems. So do biofuel technologies - all of them. Solar PV requires no water of course.

[talk2glenn]

Can you please supply the references for that statement?

Much of the information is proprietary; it is difficult to find collectively published quantitative data over time in the public domain. However, see this link:

http://www.hubbertpeak.com/laherrere/supply.htm

Specifically, see figures 4 and 5, for US and World (minus) US proved reserves, respectively. Note that proved reserves are not linked to production per se; they are defined as "reserves which are practically harvestable given the current price of oil and current technology".

Beyond this, there are vast quantities of unproved reserves - hydrocarbons we are reasonably confident are out there, but are not reasonably attainable given current price and technology levels.

Solar PV panels are now produced at a rate of several gigawatts worth of panels per year, the price has continually dropped over time, dramatically so in the last two years. See, e.g.

I do not know what methodology the architects of your graph used, because it is more certainly not the case that solar electricity production is anywhere near the level of $0.20/kWh. Current US aggregate production cost is ~$0.32/kWh. This is a customer-cost rate for residential, roof-mounted solar panels in optimal conditions. Because it is a customer-cost rate, it does not include subsidy-added costs, which can be upwards of 50% of net. This implies an unsubsidized rate of ~$0.48/kWh; this is many times higher than the average electricity rates paid by most American utility customers (for reference, average rate was 12 cents in 2009 in the United States, not including demand charges).

http://www.solarbuzz.com/solarindices.htm

For commercial/industrial electricity generation, costs are lower - between 15 and 30 cents/kWh. Note that this is still significantly higher than the costs of conventional and other alternative fuels. Further, solar has one critical disadvantage (shared by other renewables) - geography. Unlike conventional plant technologies (nuclear, gas, coal), in order to achieve these rates the solar plants must be built in "optimal conditions". In the US, this means parts of the contiguous southwest (Arizona and Southern California). Efficiencies drop dramatically as one moves east and/or north (for perspective, efficiency drops by about 50% when conditions go from clear to partly cloudy in Phoenix, AZ).

The typical response from solar-advocates is that efficiency will improve with time. Clearly, this is true. But it is also true that efficiency ratings for competing technologies will also improve with time. This implies two things:

1) You'd be foolish to install rooftop solar today, when it is both cost ineffective and will be less cost ineffective tomorrow.

2) We are foolish to subsidize solar technology development to the extent that such subsidies disfavor other, potentially more efficient alternatives. There is no reason the promise of "improved efficiency" should be uniquely solar. Any technology, lavishly subsidized by public funds as solar has been, will improve. Policy makers should be asking, is the gain in efficiency/dollar equal to or greater than the gains that could be had by spending the same amount on an alternative fuel source?

These points are addressed by markets. They are not addressed by policy makers. This is why solar subsidies (like all subsidies) are generally a bad thing, from an economic perspective.

In a free market, nobody would install solar, because it makes no economic sense. So the state heavily subsidizes both solar producers and solar consumers for residential PV installations. And, in a free market, investors would consider competing technologies and investment return before lending their money. The government is interested in neither the competition nor in earning a return, so it allocates its subsidy dollars inefficiently compared to the market. Since those government dollars are removed from the private, investably money supply, the economy in aggregate will be less efficient (less growth over time). From the policy-makers perspective, this is acceptable, because the long term goal for politicians is politically desirable outcomes (namely, the success of solar), NOT return on investment (aka profit or economic growth).

[JaWiB]

1) You'd be foolish to install rooftop solar today, when it is both cost ineffective and will be less cost ineffective tomorrow.

"You" as in the consumer might benefit from rooftop solar if you state happens to have good incentives


2) We are foolish to subsidize solar technology development to the extent that such subsidies disfavor other, potentially more efficient alternatives. There is no reason the promise of "improved efficiency" should be uniquely solar. Any technology, lavishly subsidized by public funds as solar has been, will improve. Policy makers should be asking, is the gain in efficiency/dollar equal to or greater than the gains that could be had by spending the same amount on an alternative fuel source?

These points are addressed by markets. They are not addressed by policy makers. This is why solar subsidies (like all subsidies) are generally a bad thing, from an economic perspective.

As I've stated, fossil fuels are awarded more federal subsidies than renewables, and most of the federal subsidies for renewables aren't even for solar (though I guess it might not be the same at the state level?) I also believe that you have to consider the environmental cost of fossil fuels because at some point it will translate into an economic cost.


In a free market, nobody would install solar, because it makes no economic sense. So the state heavily subsidizes both solar producers and solar consumers for residential PV installations. And, in a free market, investors would consider competing technologies and investment return before lending their money. The government is interested in neither the competition nor in earning a return, so it allocates its subsidy dollars inefficiently compared to the market. Since those government dollars are removed from the private, investably money supply, the economy in aggregate will be less efficient (less growth over time). From the policy-makers perspective, this is acceptable, because the long term goal for politicians is politically desirable outcomes (namely, the success of solar), NOT return on investment (aka profit or economic growth).
Huh? Last I checked a lot of the government money in solar is going into private industry and manufacturing. I guess I'm not understanding your point

[apeiron]

Much of the information is proprietary; it is difficult to find collectively published quantitative data over time in the public domain. However, see this link:

http://www.hubbertpeak.com/laherrere/supply.htm

Specifically, see figures 4 and 5, for US and World (minus) US proved reserves, respectively. Note that proved reserves are not linked to production per se; they are defined as "reserves which are practically harvestable given the current price of oil and current technology".


Epic fail Glenn :redface:.

You somehow seem to have cited a leading peak oiler. (Remember this? http://dieoff.org/page140.pdf)

Perhaps you did not read down to the conclusion (you certainly misread the graphs)....


Today we consume three times more than we discover. No technological breakthrough is foreseen! Technology helps to produce quicker and cheaper, but hardly increases the reported reserves which anticipate the technology.

The Middle East has most of the yet-to-produce reserves, but needs a great deal of money to meet the future increase in demand, as the production of the rest of the world will decline soon. Bankers are reluctant to invest in M.E. fearing instability, lack of demand of M.E. supply and future low price.

As far as petroleum is concerned, the World is moving in the wrong direction because of very poor data and erroneous interpretation. An oil crisis could be coming and nobody is prepared.

Surplus or shortage?: the answer is surplus of oil resources (conventional and non-conventional), but shortage of oil reserves before 2010 In fact, as oil price will increase substantially, the demand will be less than anticipated. There are many fields for energy savings.

[mheslep]

I do not know what methodology the architects of your graph used, because it is more certainly not the case that solar electricity production is anywhere near the level of $0.20/kWh. Current US aggregate production cost is ~$0.32/kWh. This is a customer-cost rate for residential, roof-mounted solar panels in optimal conditions. http://www.solarbuzz.com/solarindices.htmRecheck, e.g. solarbuzz. Of course the chart from that solar PV company is using a favourable bracket, which in the US for Industrial systems in sunny climates is now $0.192 per kWh (http://www.solarbuzz.com/solarindices.htm) for July 2010, so the chart from 1366 Tech is accurate for that case, especially since they draw the distinction between retail (residential) and wholesale electricity (two horizontal lines). The difference between residential and industrial PV is clearly due to greater installation and distribution costs, i.e. cost of installation scale, which is irrelevant to a figure on costs of PV cell production itself over time - the point of that chart.

Because it is a customer-cost rate, it does not include subsidy-added costs, which can be upwards of 50% of net. This implies an unsubsidized rate of ~$0.48/kWh; this is many times higher than the average electricity rates paid by most American utility customers (for reference, average rate was 12 cents in 2009 in the United States, not including demand charges).Solarbuzz prices specifically exclude:

the impact of rebate programs that are available today in some European Countries, Japan, some States of the USA and through bi-lateral aid programs.

For commercial/industrial electricity generation, costs are lower - between 15 and 30 cents/kWh. Note that this is still significantly higher than the costs of conventional and other alternative fuels.Yes for the moment. If trends continue as shown in the PV cost chart indicating solar PV is dropping 10% per year, then in 5-10 years that will no longer be true for some cases.
Further, solar has one critical disadvantage (shared by other renewables) - geography. Unlike conventional plant technologies (nuclear, gas, coal), in order to achieve these rates the solar plants must be built in "optimal conditions". In the US, this means parts of the contiguous southwest (Arizona and Southern California).Well replace 'must be' with 'are more cost effective when'
Efficiencies drop dramatically as one moves east and/or north (for perspective, efficiency drops by about 50% when conditions go from clear to partly cloudy in Phoenix, AZ).Capacity factor drops (% of daily sunlight available) in less than sunny conditions and thus cost per kWh rises in the E./N. Efficiency (% of incident light converted to electricity) of the PV panels actually improves in cooler climates.
The typical response from solar-advocates is that efficiency will improve with time. Clearly, this is true. Agreed.
But it is also true that efficiency ratings for competing technologies will also improve with time. Er, no. The efficiency of carnot cycle boiler plants are approaching their thermodynamic limits, have been for some time. More can and is being done in traditional heat cycle plants with rejected waste heat - combined cycle plants, and more efficient turbine blades. Though these gains are significant over the total scale of the grid, the efficiency gains themselves are small - unlike those seen in PV. More importantly, the cost of fuels for these plants (nuclear aside for the moment) is only going up, even if coal and gas reserves are plentiful at the moment.
2) We are foolish to subsidize solar technology development to the extent that such subsidies disfavor other, potentially more efficient alternatives. There is no reason the promise of "improved efficiency" should be uniquely solar.Solar subsidies may or may not be over done, but not for the reasons you suggest here. PV efficiency is not limited in the way heat engine efficiencies are (as this NREL chart suggests (http://upload.wikimedia.org/wikipedia/commons/c/c9/PVeff%28rev100414%29.png)), nor are there limited fuel supply issues increasing costs as in the case of fossil fuels.
Any technology, lavishly subsidized by public funds as solar has been, will improve. Fossil and nuclear have received much, much more government subsidies in total. We see figures of dollars per Watt produced showing renewables receiving more than fossil/nuclear, but I don't find that metric, by itself, useful.
Policy makers should be asking, is the gain in efficiency/dollar equal to or greater than the gains that could be had by spending the same amount on an alternative fuel source?
These points are addressed by markets. They are not addressed by policy makers. This is why solar subsidies (like all subsidies) are generally a bad thing, from an economic perspective.I'm generally in agreement with you here on subsidies and I favor free markets when I can find one. Here, the competition (fossil/nuclear) has been given more subsidies by orders of magnitude in total than solar/wind/etc. Take away the $billions of subsidies given to fossil/nuclear including that which it received in the past, add back in the externalities cost (pollution), then lets talk.

[heusdens]

Don't forget about concentrated solar power, it is more cost effective then PV, and estimates are that it can be more cost effective as electricity produced by oil before 2020. Also, it has the additional capacity to be able to desalinate water from the excess heat, so it would be a good idea to place them in desert like regions with plenty of sunshine.

[heusdens]

Fossil and nuclear have received much, much more government subsidies in total. We see figures of dollars per Watt produced showing renewables receiving more than fossil/nuclear, but I don't find that metric, by itself, useful.
I'm generally in agreement with you here on subsidies and I favor free markets when I can find one. Here, the competition (fossil/nuclear) has been given more subsidies by orders of magnitude in total than solar/wind/etc. Take away the $billions of subsidies given to fossil/nuclear including that which it received in the past, add back in the externalities cost (pollution), then lets talk.

Right!

Those mentioning that renewables depend on subsidies never mention those facts, and they are being dishonest about it by claiming that fossil and nuclear would not cost subsidies.

These lies we see over and over again (currently in the Netherlands the right-wing liberal and anti-islamic parties, claim in a similar fashion that windenergy only costs subsidies, while the truth is that wind power is taxed more as subsidized).

They have an agenda to keep us on fossil as long as possible (maximizing the profits of the oild- and gas companies) and hand us over into the monopoly of nuclear power.
Nuclear power will become the favourite targets of terrorists. But windmills will never be a target for terrorists.

Nuclear power will require a very centralized form of energy distribution, and that power will be in the hand of a few. But a mixture of many renewables is much more democratic as every citizin and region can provide their own energy. No centralized form of control possible in that option.

[mheslep]

Don't forget about concentrated solar power, it is more cost effective then PV, and estimates are that it can be more cost effective as electricity produced by oil before 2020.Yes concentrated solar thermal is more cost effective than PV at the moment, but concentrated solar thermal also has the drawback of generally coming in one size, large, and generally requiring lots of water.

[mheslep]

These lies we see over and over again (currently in the Netherlands the right-wing liberal and anti-islamic parties, claim in a similar fashion that windenergy only costs subsidies, while the truth is that wind power is taxed more as subsidized).

They have an agenda to keep us on fossil as long as possible (maximizing the profits of the oild- and gas companies) and hand us over into the monopoly of nuclear power.Do you have a source showing where these Netherlands political parties make these claims and state this agenda?

[talk2glenn]

Epic fail Glenn :redface:.

You somehow seem to have cited a leading peak oiler. (Remember this? http://dieoff.org/page140.pdf)

Perhaps you did not read down to the conclusion (you certainly misread the graphs)....

Their data was sound, which is what I was citing. Their conclusions were not. Did you notice that paragraph was written in 1997? For the past 13 years, proved reserves have in fact gone up (most recently by 0.7% in 2009, according to BP).

This directly contradicts the claim that production demand was greater in '97 than new discoveries. Their predictions are directly contradicted by observed evidence, as has always been the case for "peak oil" theorists.

I am reminded of a famous bet entered into by an economist and, I believe, a geologist. The names of the principals escapes me. The economist told the geologist to pick a basket of 10 commodities of his choice; the economist cared not what was chosen. The price of that basket would then be tracked over a period of ten years. If the average price of that basket was greater at the end of the bet than at the time it was placed, the economist would lose to the geologist. If the reverse was true, the geologist would lose to the economist.

Can you guess what happened? At the end of the bet term, the real price of the basket was not only lower, but the price of every commodity selected was also lower. The geologist lost absolutely.

Solarbuzz prices specifically exclude:

True, but the impact of other subsidies, which represent a significantly larger share of the net subsidy than simple customer cash rebates at time of purchase, are already built into the quoted costs used by solarbuzz.

Including rebates, retail solar subsidies approach 60% in some jurisdictions.

Er, no. The efficiency of carnot cycle boiler plants are approaching their thermodynamic limits, have been for some time. More can and is being done in traditional heat cycle plants with rejected waste heat - combined cycle plants, and more efficient turbine blades. Though these gains are significant over the total scale of the grid, the efficiency gains themselves are small - unlike those seen in PV. More importantly, the cost of fuels for these plants (nuclear aside for the moment) is only going up, even if coal and gas reserves are plentiful at the moment.

I am not an engineer, so it is difficult for me to argue with this. My concern is simply this: it is understood in economics that capital investment produces increased output, regardless of industry. A capital investment in solar will produce increased productive output. Similarly, a capital investment in coal plants will produce increased productive output.

I cannot predict and in fact do not care which investment will produce greater production gains. However, if it is the case that an investment in solar power will produce a greater return that a like kind investment in a competing technology, the public subsidy should not be necesarry. The subsidy is necesarry only to the extent that, in the absence of the public funds, there would not be an equal or greater investment of private funds. If private investors will not invest in a given business model, it is because they rationally expect to achieve a greater return through some competing, alternative investment.

Ergo, I can simply assume that because the solar subsidies exist and are lavish, it is because solar is politically rather than economically favored.

Fossil and nuclear have received much, much more government subsidies in total. We see figures of dollars per Watt produced showing renewables receiving more than fossil/nuclear, but I don't find that metric, by itself, useful.

Are we talking over program life times? This may or may not be the case, but it is certainly the case that so-called conventional energy sources are today negatively subsidized. That is, the amount of any government assistance to these industries is less than (substantially less than) the cost of taxes, fees, fines, and royalties.

I am also skeptical of the claim that the startup of these industries required lavish government interventions. These industries are established and dominant because they are cheap and plentiful, a fact which attracted massive initial private investment. It simply was not necesarry that the government support the oil, gas, and coal industry; it has always been the most economically viable means of fixed and portable energy production.

They have an agenda to keep us on fossil as long as possible (maximizing the profits of the oild- and gas companies) and hand us over into the monopoly of nuclear power.
Nuclear power will become the favourite targets of terrorists. But windmills will never be a target for terrorists.

This is conspiratorial; who is "they", and why do they care where you get your electricity?

"You" as in the consumer might benefit from rooftop solar if you state happens to have good incentives

My point exactly. In the absence of such incentives, no rational person would install solar panels, today.

Huh? Last I checked a lot of the government money in solar is going into private industry and manufacturing. I guess I'm not understanding your point

My point is that, because government is motivated by political rather than economic ends (that is, government is not concerned with achieving the maximum possible return on its investment dollars), those subsidy dollars would achieve a greater effect if invested privately in more efficient, competing alternatives. Government investment produces jobs and production output, of course. The question you should be asking is, would an identical investment in another industry have produced more jobs than the government plan? There are always opportunity costs. Markets are assumed to produce gains of maximal possible efficiency, given current conditions. There are no such assumptions for governments.

[mheslep]

I am reminded of a famous bet entered into by an economist and, I believe, a geologist. The names of the principals escapes me. The economist told the geologist to pick a basket of 10 commodities of his choice; the economist cared not what was chosen. The price of that basket would then be tracked over a period of ten years. ...You are referring to the Simon-Erlich (http://en.wikipedia.org/wiki/Simon-Ehrlich_wager) wager. Both were academics; Simon was an economist-business professor, Erlich is a biologist-ecologist. Simon's point, validated in winning the wager, was not that the supply of a given commodity will simply keep increasing via exploration, but that as the price of a given commodity increases users find less expensive alternatives. Simon also bet on commodities that can never really be depleted in a conservation of mass sense - metals. That is, there is just as much Nickel on the planet today as there was 10,000 years ago. Energy is different. Once used and 'dispersed' (its entropy is said to increase) it can never be re-concentrated without using even more energy. However, for what it is worth I believe Simon's point still applies to energy sources over a longer time frame.

[heusdens]

Do you have a source showing where these Netherlands political parties make these claims and state this agenda?

These claims (esp. against wind-energy) were made over and over again in the past elections. View their websites (in dutch) www.vvd.nl and www.pvv.nl

That they have some agenda, is just my own political intuition.

The "geert wilders" anti-islamic party (called "PVV" party of freedom) is a racist, xenofobic and anti-islamic party (and very pro-israel), which derived as a fraction of the VVD. They offer "simple" solutions to complex issues, they want to barrier immigration (esp. from moslim countries), want to repell moslims from the Netherlands when they have comitted illegal acts, want to forbid islamic schools (we have freedom of religion in netherlands, meaning all religious groups can raise their own schools), they want ethnic registration, etc.

The VVD, PVV and CDA (christen democratic party) find each other on the issue of not-abolshing the tax reducation on interests for mortgages. Economically that isn't feasible cause this tax-reduction causes house prices to become staggering high as to be non-afforable for starting household, and which is the current cause of the stagnation of the housing market.

The housing market, with house prices raising more as five times in 30 years, is a giant bubble, which serves the capitalist economy for maximum creation of money (any debt creates new money, that comes in to the economy, gets spend, etc.) but when house prices are too high, and buyers do no longer afford that high costs, this tears down the whole economy.

Almost all other parties want to get rid of this absurd tax-reduction policy for mortgages, so that house prices in the long run will be afforable again, but within a reasonable time frame.

Both the VVD and the PVV are arguing from the point of view that the whole climate debate makes no sense and esp. the PVV argues that "climate gate" proved that climate change caused (AGW) by humans is a "fraud".

They plea for nuclear energy, same as the VVD, and possible also the CDA, and plea against subsidies for renewables (based on false information, regarding both the subsidies issue as the climate argument - there was no scientific fraud).

As the neo-liberal agenda caused us the past and current and future crisis (the deregulation of many sectors, including the financial sectors), they have every reason to make people affraid of other threats (the Islam as the main enemy). It (this racist/xenofobic policy) serves a purpose of course, as this looks upon Muslims as being less then human-less civilized, which in turn serves the purpose of the illegal occupations of Muslims countries (Iraq, Afghanistan and the whole Israel/Palestinan issue).

[ As in previous periods for instance during the colonization of Indonesia, the Indo indigious people were treated as uncivilized and treated in a racist way, and also during the slavery periods, racism esp. had the form of anti-negro sentiments as being uncivilzed and less then human, so the racist policies always coincide with some other political/economic policy. ]

Undeniable the Iraq and Afghanistan occupation only serves the plundering of their crude resources, and no democratic or humanitarian goal. The military occupation has never pacified any of these countries, has not served their human interests and does not create a stable democracy, and also the military struggle can never be won. But as long as there is a war to fight the troops have an excuse to be there, so there isn't any intention to 'win' the war there, it just serves the political/economical goal. Iraq has been transformed into a pseudo-democracy, in which the real power is in the hand of the dominating oil-producing industries.

[talk2glenn]

You are referring to the Simon-Erlich (http://en.wikipedia.org/wiki/Simon-Ehrlich_wager) wager. Both were academics; Simon was an economist-business professor, Erlich is a biologist-ecologist. Simon's point, validated in winning the wager, was not that the supply of a given commodity will simply keep increasing via exploration, but that as the price of a given commodity increases users find less expensive alternatives. Simon also bet on commodities that can never really be depleted in a conservation of mass sense - metals. That is, there is just as much Nickel on the planet today as there was 10,000 years ago. Energy is different. Once used and 'dispersed' (its entropy is said to increase) it can never be re-concentrated without using even more energy. However, for what it is worth I believe Simon's point still applies to energy sources over a longer time frame.

Precisely. I absolutely agree that there may be a point where competing alternatives are more cost-effective than additional conventional energy producing infrastructure. That point will be marked by an unsubsidized negative rate difference (the costs of bring an additional kWh of solar online will be less than the costs of bring an additional kWh of coal or LNG online).

When we reach that point, investors will stop building conventional plants and start building solar plants. This will have the effect of raising the cost solar energy, and lowering the cost of conventional energy, until the ratio is positive again, and investors switch back.

This means that practically, if not theoretically, our supply of any commodity which has demand market value is infinite. Price ratios, production profit incentives, and the existence of competing alternatives guarantees it to be so.

This is why economists don't lose sleep at night worry about how we will feed exponentially growing populations. The market will find a way, even if it means that the cost of food as a proportion of total household expenses must go up (an unlikely but possible outcome; more likely cost of food will go down, which is the observed outcome over time, historically).

[mheslep]

...Are we talking over program life times? This may or may not be the case, but it is certainly the case that so-called conventional energy sources are today negatively subsidized. That is, the amount of any government assistance to these industries is less than (substantially less than) the cost of taxes, fees, fines, and royalties.I'll have to look at that some more, but I suspect that the same is true for solar and wind. I know for certain its true (on balance negative subsidy) in at least one well studied case of a large California 1980s-90s solar farm - the property taxes killed them.
I am also skeptical of the claim that the startup of these industries required lavish government interventions. Probably not, but then I'm reasonably certain that when coal, gas, and oil started up they didn't have to compete with existing industries already subsidized by the government for decades.

These industries are established and dominant because they are cheap and plentiful, a fact which attracted massive initial private investment.
Agreed, but again I'm arguing for the same level playing field under which fossil energy got started. I argue that but for substantial government support of fossil/nuclear renewables such as solar would be also be more attractive.

It simply was not necessary that the government support the oil, gas, and coal industry; it has always been the most economically viable means of fixed and portable energy production.Yes, fossil fuels have been a great energy source for the better part of a century but of course not 'always.' Before fossil oil there was whale oil. (http://timetoeatthedogs.files.wordpress.com/2008/09/whaling-ships.jpg) Before coal there was wood. And at least in the case of oil, government support by way of the US 7th fleet keeping the Gulf of Suez open was and is absolutely required.

[talk2glenn]

Before fossil oil there was whale oil. (http://timetoeatthedogs.files.wordpress.com/2008/09/whaling-ships.jpg) Before coal there was wood. And at least in the case of oil, government support by way of the US 7th fleet keeping the Gulf of Suez open was and is absolutely required.

I am glad you brought this up, because I was eager to enter the example of whales into the argument.

Whales were not saved from human-induced extinction by environmental laws, but rather by market laws. As the efficiently harvestable supply of whales was reduced (given the technology availabe to whale hunters at a fixed time), the cost of whale blubber as a fuel source increased. While this was happening, the efficiently harvestable supply of crude oil was increasing (given the technology available to speculators at the same, fixed time), which had the effect of lowering the cost of kerosense as a fuel source, until the ratio was negative (kerosene was cheaper than blubber).

Once negative, consumers stopped lighting their homes with blubber, and started lighting their homes with kerosene. In principal, it could one day become cheaper to light your homes with blubber again, but in practice this has not happened (oil continued to become cheaper, while our productive capacity to harvest whales for their blubber hasn't improved much).

But the de facto result was that whales were never driven to extinction by human economic activity, and never would have been. As the value of whale blubber goes up, consumers have an incentive to exploit competing alternatives, and producers have an incentive to produce more whale oil (increase the supply through exploration, farming, efficiency of blubber output per whale, or whatever).

I'll have to look at that some more, but I suspect that the same is true for solar and wind.

Solar and wind are often exempted from public startup costs (be it property tax exemptions, environmental regulation exemptions, etcetera) by local governments, and because they are usually not profitable in any near terms, they have an unintended but real income tax exemption.

Couple this with public grants and loan guarantees, and you have a positive net subsidy.

[mheslep]

Undeniable the Iraq and Afghanistan occupation only serves the plundering of their crude resources, and no democratic or humanitarian goal. Denied (http://img.timeinc.net/time/daily/2010/1007/time_cover_0809.jpg), and off topic.

[Office_Shredder]

Solar and wind are often exempted from public startup costs (be it property tax exemptions, environmental regulation exemptions, etcetera) by local governments, and because they are usually not profitable in any near terms, they have an unintended but real income tax exemption.

First, Walmart is often exempt from public property tax (how is a yearly payment a startup cost anyway?) along with many other big chains. Towns supporting businesses through eminent domain, tax breaks etc. in order to boost their economy is something that happens all the time, and to single out solar power for getting this benefit occasionally also is disingenuous.

You'll need to provide evidence of this common environmental regulation exemption.

Also, the income tax exemption because of lack of profit is just nonsense. Oil companies have the same opportunity (for example, Exxon-Mobil paid no income tax to the US in 2009)

[apeiron]

Their data was sound, which is what I was citing. Their conclusions were not. Did you notice that paragraph was written in 1997?

Yes, I noticed. Was there a reason for quoting old data rather than something current? And can you be specific about which data you are citing because it sounds like you are taking as valid exactly the trend lines the study criticises for faulty methodology.


For the past 13 years, proved reserves have in fact gone up (most recently by 0.7% in 2009, according to BP).


Now what you originally said was....

Global proved oil reserves have grown every year since they began collecting the data using current methodology at the turn of the century. This means that we are finding new, economically exploitable oil (at current price and technology levels) faster than we are drilling it up.

But you do know the difference between actually finding new reserves and simply reclassifying known unconventional reserves, right?

[mheslep]

Also, the income tax exemption because of lack of profit is just nonsense. Oil companies have the same opportunity (for example, Exxon-Mobil paid no income tax to the US in 2009)No, ExxonMobil is not an example of a zero tax bill because of net losses. Exxon Mobil paid $17.6B in 2009, $36B in 2008 (http://www.forbes.com/2010/04/01/ge-exxon-walmart-business-washington-corporate-taxes_slide_3.html), they just paid it elsewhere and not in the US. There may be plenty of good reasons to object to the tax laws that allow this, but these have nothing to do with this topic - tax liabilities or avoidance that may / may not apply only to renewable energy.

Edit: Forbes later updated their story to show Exxon did pay US taxes in 2009:
And for all you commenters outraged that Exxon isn't paying taxes in the U.S., don't worry, it is. Our article only focused on income taxes, but it's worth noting that the 10-k also records $7.7 billion in other taxes in the U.S. (like sales taxes)

[Office_Shredder]

No, that is not an example of a zero tax bill because of net losses. Exxon Mobil paid $17.6B in 2009, $36B in 2008 (http://www.forbes.com/2010/04/01/ge-exxon-walmart-business-washington-corporate-taxes_slide_3.html), they just paid it elsewhere and not in the US. There may be plenty of good reasons to object to the tax laws that allow this, but these have nothing to do with this topic - tax liabilities or avoidance that may / may not apply only to renewable energy.

I think you missed my main point. talk said that the fact that income tax is only levied on net profit somehow counts as a subsidy for solar power. I was pointing out that the same income tax rules apply to everyone.

[mheslep]

I think you missed my main point. [...]. I was pointing out that the same income tax rules apply to everyone.I got your larger point and agree; I also chose not to let the flawed example stand.

[apeiron]

Denied (http://img.timeinc.net/time/daily/2010/1007/time_cover_0809.jpg), and off topic.

If the topic has become about the responses to peak fossil fuels, then US military action in oil-rich areas is of course on topic. Would you want your nation to pursue simply technological solutions and ignore the geopolitical ones?

Pretty girls with their noses cut-off make good propaganda to stir a populace that is tiring of the US's longest war and wondering how the extreme cost can be justified while health and education in the homeland has to suffer. But that is an emotional argument and so not a valid one here.

Peak oil modelling has to factor in all the likely responses to arriving at a production turning point. Even oil companies like Shell are coming out with useful scramble vs blueprint analyses.

http://www-static.shell.com/static/public/downloads/brochures/corporate_pkg/scenarios/shell_energy_scenarios_2050.pdf

You only have to research the current US programme of air base building in the Middle East to get clear evidence of scramble.

We can all play the emotive picture game.
http://www.google.co.nz/imgres?imgurl=http://www.rawa.org/temp/runews/data/upimages/korenga_valley_afghanistan_killed_by_us.jpg&imgrefurl=http://www.rawa.org/temp/runews/2009/10/15/killing-the-innocents-to-save-our-troops.html&usg=__xkoEPJ273iM7i45XZNNwlGtw9T4=&h=436&w=550&sz=54&hl=en&start=9&um=1&itbs=1&tbnid=gDzdPfN59WdaHM:&tbnh=105&tbnw=133&prev=/images%3Fq%3Dafghanistan%2Bcivilian%2Bcasualties%2 Bus%2Bfire%26um%3D1%26hl%3Den%26sa%3DG%26tbs%3Disc h:1

But my interest lies in what is really happening in the world.

[mheslep]

If the topic has become about the responses to peak fossil fuels, then US military action in oil-rich areas is of course on topic. Would you want your nation to pursue simply technological solutions and ignore the geopolitical ones?...As you well know, Afghanistan is not an oil-rich area, so please don't detour the conversation there.

[heusdens]

Denied (http://img.timeinc.net/time/daily/2010/1007/time_cover_0809.jpg), and off topic.

Well you must be fundamentalistic believer in the true goodness of imperialism for bringing democracy and human rights to countries (like Afghanistan and Iraq), but for sure they come with a lot of bombs. As experienced previously Vietnam and Korea...

I stay a skeptic of such claims, since there are of course strategic raw materials that are far more important then human rights (and undeniably, the US does not have a very good record on supporting "democratic" regimes, given their support for Pinochet/Chili, Suharto/Indonesia, and many other right-wing or out-right fascist regimes).

We know we have been lied about Iraq. There was no Al Qaida connection. There were no WMD's. There were only massive deceptions.

I think this issue is "on topic" afaic.

[heusdens]

As you well know, Afghanistan is not an oil-rich area, so please don't detour the conversation there.

Which does not mean that:
1) They do have large deposits of valuable raw materials (like for instance Lithium).
2) You don't seem to remember the Unilocal (or whatever the oil companie's name was, Kazar was working at that firm; the Chinese wanted to buy this oil company but it was blocked by the US) issue, in which Afghanistan is a strategic region, as it is the only way to get oil out of the Kaspian/Central asian region without having to pass through Iran or Russia.

[heusdens]

Denied (http://img.timeinc.net/time/daily/2010/1007/time_cover_0809.jpg), and off topic.

btw. was that damage done by the Taliban (put in power by who again? If I am correct, the US placed them in power after the Soviets retreated) or a civilian casualty of the warfare (a misdropped bomb or something)?

Them fundamentalists and righ-wing Islamist where in the Soviet epoche called "freedom fighters", since they were good for fighting the "evil" commists. Now they are the enemy.
Like Saddam was before a friend of the USA, he could kill his own people and go into war with Iran, but then all of a sudden Saddam was the main enemy.

Afghan women were basically free in Afghanistan, during the Soviet occupation, and this could have lasted if not the US were supporting the right-wing fundamentalistic Islamic groups there.

So what side is the US on anyway?
So

[mheslep]

I think this issue is "on topic" afaic.Which is "Peak fossil fuels by 2017"

[Office_Shredder]

If this wasn't off topic before, certainly a bad attempt at criticism of US international policy over the past half century is off topic.

[heusdens]

If this wasn't off topic before, certainly a bad attempt at criticism of US international policy over the past half century is off topic.

I will reserve that critique for another topic. Anyway, the peak oil issue is closely related to how one handles upcoming oil scarcities, and this includes the military actions also. But if you want to treat that as a "different topic" even though it is connected to that same issue, I'll be glad to do that.

[apeiron]

As you well know, Afghanistan is not an oil-rich area, so please don't detour the conversation there.

It is strategic to the domination of an oil rich area. And there is also of course the direct interest in controlling future routes for natural gas pipelines.

One of the points of Mohr's study is just how important gas will be. So from a nationalistic US viewpoint, people might think it foolish if the US did not have the foresight to secure access to gas for itself and its friends.

But you are right that the topic was about the evidence for a fast approaching peak in fossil fuel - even coal, which would be the suprise for many.

Responses to that peak would be both technological and geopolitical. And we could even use the US case as a guide to which response might dominate.

US oil production did peak. It did not build nuclear reactors or wind turbines to keep the game going. It did find ways to manage saudi arabia and the other largest overseas oil reservoirs.

In a market forces analysis, one pathway appears to have been favoured over the other.

OK, I have set that argument up in a clearly tenditious way. But if people want to debate the likely response to peak fossil fuels, then the relative costs of warfare and new technology ought to be compared.

Scramble vs blueprints as the Shell document alludes.

[talk2glenn]

First, Walmart is often exempt from public property tax (how is a yearly payment a startup cost anyway?) along with many other big chains. Towns supporting businesses through eminent domain, tax breaks etc. in order to boost their economy is something that happens all the time, and to single out solar power for getting this benefit occasionally also is disingenuous.

I do not deny that this is common industry practice beyond solar power, nor do I think this is a "bad thing" in and of itself. In a subsidy-free environment, temporary tax exemptions help level the playing field for business startups relative to entrenched competitors. It is a policy discretion - the local government has decided that the subsidy is a good political policy, for its own reasons. But it is a policy with economic consequences, and those economic consequences are typically, but not always or necesarrily, negative for broader economic efficiency (does Wal Mart choose to open a new store in the most economically or politically desirable location?).

The trouble is when these subsidies (which the temporary tax credits are, by definition) are in addition to an already large federal largesse. Usually local communities justify the temporary local exemption as an offset against other negative subsidy items (federal taxes, environmental regulations, licensing fees, etc). In the case of renewable energy companies, this argument fails on its face.

Also, the income tax exemption because of lack of profit is just nonsense. Oil companies have the same opportunity (for example, Exxon-Mobil paid no income tax to the US in 2009)

You have cherry picked your data. The effective tax rate for Exxon-Mobil was a staggering 47 percent of taxable revenues. Further, as has already been pointed out, there are many additional taxes on oil companies (land use taxes, royalty taxes, licenseing fees, etc) that are deducted from taxable revenue but still paid to the national government.

The oil and gas industries are probably the largest non-personal revenue sources for the worlds governments, on average.

But you do know the difference between actually finding new reserves and simply reclassifying known unconventional reserves, right?

And you understand the difference between classified proved and unproved reserves, right? Proved reserves are a regulated, fiscal classification for corporate reporting purposes, and are defined as "economically practical reserves given current price and technology levels".

Clearly, before a reserve is "proved" it starts it life as "unproved". The burden is on the reporting company to establish that it can profitably remove some sum of oil from some point in the ground given the resources it has, if it attracts some fixed investment pool from private investors. So yes, all proved oil reserves by definition started their lives in the arbitrary, nonstandard, and very loosely understood unproved pool. What does this prove?

talk said that the fact that income tax is only levied on net profit somehow counts as a subsidy for solar power. I was pointing out that the same income tax rules apply to everyone.

I never said otherwise. In fact, I specifically said the income tax exemption for lack of taxable income was an unintended subsidy of the solar industry (given that the solar industry is able to channel its operating revenues into non-taxable initiatives). That it is unintended changes not the fact that it is a de facto subsidy.

For comparison, First Solar paid $23 million dollars in tax on $195 million in income, for an effective rate of less than 12%, well below rates paid by Exxon and other oil/gas companies.

[brainstorm]

There is no "disaster". This is a political myth promoted by interested parties who regard petroleum and other carbon fuels as "bad", and so-called alternatves as "good". If there were any impending threat of a collapse in global oil supplies, the price of oil (which reflects both current supply/demand and anticipated future supply/demand, through the futures markets) would be significantly higher than it is currently. Even with recent inflation, which is a product of market distortion through public policy (war, energy subsidy, etcetera) and not fundamental changes in supply/demand (the increased demand from China is more than offset by increased production), refined oil remains extremely cheap, relatively speaking. This is because it is extremely plentiful.
It is so funny to me that I go from the overpopulation thread, where everyone is quite sure that global population growth is leading to inevitable disaster, to this thread where oil is only "theoretically" scarce and the idea of disaster is a fiction promoted by political proponents of alternative fuels. I don't doubt that oil reserves are still significant, although new predictions seem to emerge all the time, probably each with its own market interest attached to it. What I do doubt is that economic growth based on oil-dependency is sustainable insofar as the bigger the economy grows, the more oil-intensive it becomes. It's like trying to keep a furnace running where the house keeps getting bigger and requiring increasing amounts of fuel to maintain the desired temperature.

If conservation practices were resulting in a steady decrease in per-capita oil usage globally, I would say that no abrupt crisis is likely at any point in the future. As long as per-capita oil usage is remaining the same or going up, though, there has to come some point in the future where scarcity will become immanent and conservation driven by necessity is never as pleasant as voluntary measures. Of course, alternative fuel sources and transit may evolve to the point where energy demand can remain high but transition smoothly from oil to others as it becomes necessary to do so. However, that will only be smooth transition if those industries are established, tried and true when they're needed. Otherwise it will be like trying to change a flat tire when you're already late, except you have to invent the spare tire before you can change the flat.

To exercise this point, consider the recent cash for clunkers program. The program subsidized the purchase of cars in the short term, but everyone acknowledge that this would mean a later-term decline in car sales, once the subsidies were eliminated (in effect, people who would have otherwise purchased their vehicle in a month purchased it today; net sales were unaffected, just the rate of sales). Subsidy advocates argue that, due to unforeseen market conditions, it is worth moving future demand to present demand, for political reasons.
I think it would have been more conducive to alternative-transit cultural growth and development if cash4clunkers and the auto industry bailout had not occurred. Getting a bunch of new cars on the road has a trickle-down effect of causing people to see hope of getting a new car, or a relatively new used one sooner than later. As long as people are having to maintain their clunkers, there is a certain realism about the amount of economic energy (labor and parts) that goes into maintaining these big, heavy vehicles. Compared to a clunker, walking/biking or buses are less of a pain. Compared to a new car with perfect climate control, sound-proofing, and a state-of-the-art sound system and all the creature comforts, buses/walking/biking seem like a pain. So cash4clunkers was more than an economic move, it was a cultural stimulus package.

[apeiron]

And you understand the difference between classified proved and unproved reserves, right? Proved reserves are a regulated, fiscal classification for corporate reporting purposes, and are defined as "economically practical reserves given current price and technology levels".


You are evading the point - which was about conventional vs unconventional. And about discovery vs reclassified.

What you said was that new discoveries outstripped consumption, not reclassified unconventional outstripped consumption.

So yes, now you may want to correct yourself.

But you have done such an awful job providing citations to back up your claims that I would discount anything you might say on the subject.

[talk2glenn]

As long as per-capita oil usage is remaining the same or going up, though, there has to come some point in the future where scarcity will become immanent

I think the problem is in the presumption that this point is a "black day", and the notion that there will be some dramatic change in oil consumption/production patterns overnight, with catastrophic social consequences.

Markets do not work this way. Investors are very cognizant of changing demand trends, and this weighs heavily in their invesmtnet decisions (you don't buy a 10 year bond in a company without considering its ability to repay that debt 10 years from now, regardless of present financial circumstances).

As oil usage goes up, all other things being equal, this puts inflationary pressures on oil prices. This in turn encourages consumers and producers to do two very different things, both of which put negative price pressure on the commodity:

1) Consumers are incentivized to use less oil, either by purchasing cheaper alternatives or reducing overall energy demand.

2) Producers are incentivized to produce more oil, either by exploring for new fields or more efficiently exploiting existing operations.

If at some theoretical point in time, producers are no longer able to keep up with demand price pressures, consumers will pick up the slack, so to speak. In this manner, an long term equilibrium is maintained that practically insures no valuable, marketable commodity is "used up", and that changes in consumption patterns are gradual and relatively non-consequential (there was no social upheaval as economies transitioned from dependency on water-power to electric-power for industrial output, for example).

Humans have been cutting down trees since the beginning of time, yet there is no concern of "peak wood" or an imminent drying up of global wood supply. Granted, there are some very clear differences in the wood market relative to the petroleum products market (particularly in the time scales needed to replace lost supply), but the principal is the same. Market forces naturally insure that wood will not be exhausted, even if such an exhaustion is theoretically possible given a fixed supply of trees at any fixed point in time.

What you said was that new discoveries outstripped consumption, not reclassified unconventional outstripped consumption.

Re-read what I wrote and what was quoted. I said new economically exploitable discoveries outstripped consumption. Nobody knows how much oil is in unproven fields, beyond educated guesses, because the surveying process is very expensive and time consuming. There is no incentive for oil companies to bother figuring out how much oil is in actually in Utah shale, because they don't anticipate it being economically reachable today.

Since talk of "discoveries" that does not specifically exclude the unproved and intentionally include only changes in reported, proved reserves is arbitrary, subjective and theoretical, I do not engage in it.

[brainstorm]

1) Consumers are incentivized to use less oil, either by purchasing cheaper alternatives or reducing overall energy demand.

If at some theoretical point in time, producers are no longer able to keep up with demand price pressures, consumers will pick up the slack, so to speak. In this manner, an long term equilibrium is maintained that practically insures no valuable, marketable commodity is "used up", and that changes in consumption patterns are gradual and relatively non-consequential (there was no social upheaval as economies transitioned from dependency on water-power to electric-power for industrial output, for example).

I love it. This is what I was telling people when gas was $4/gallon. The problem is that the economy responded to the challenge of $4/gallon gas rather poorly. If people hadn't pushed for increasing supply-side competition to drive the price down, I don't know what would have happened. Plus, the economy is still dragging along with $3/gallon gas. What economic restructuring and innovations have been implemented to increase oil-demand elasticity? To my knowledge, reasonably little except consumers have become wiser, more cautious, and more innovative when it comes to restricting their fuel-consumption.

Have businesses and residences altered their locations or employment/labor practices in ways that have reduced auto-commuting? Have large numbers of people shifted to relying on public transit? Have local retail outlets shifted to catering to pedestrian and bicycle traffic to the point where people can live sustainably without driving if necessary? No. Why? Because even $4/gallon didn't bring it to that point. But what happens when gas gets up to $6/gallon next time?

[apeiron]

Since talk of "discoveries" that does not specifically exclude the unproved and intentionally include only changes in reported, proved reserves is arbitrary, subjective and theoretical, I do not engage in it.

It's good that you share your private definition of terms like discovery (and new?) with us.

But now can you supply a recent study that makes more sense. Give us some actual figures.

[talk2glenn]

It's good that you share your private definition of terms like discovery (and new?) with us.

But now can you supply a recent study that makes more sense. Give us some actual figures.

I did no such thing! Proved reserves is a precise term defined uniformly by the SEC, DOE, DOI, and various international bodies. That's why we use it when we talk of discoveries; it was developed specifically to standardize and objectify discussion of oil field reserves, including new and existing finds.

[Evo]

You are evading the point - which was about conventional vs unconventional. And about discovery vs reclassified.

What you said was that new discoveries outstripped consumption, not reclassified unconventional outstripped consumption.

So yes, now you may want to correct yourself.

But you have done such an awful job providing citations to back up your claims that I would discount anything you might say on the subject.Apieron, you need to cite your sources too.

[Evo]

I will unlock this thread, but I need sources from everyone that has made any statement of fact.

No posts are to be made unless they are valid sources to back up what has already been posted.

If you have not made any claims, then you may continue to post your opinions.

If you have made no claims but are only requesting proof, please point that out to me. The burden of proof is on the one making the claim. However, if you also made claims, then you need to back them up.

I just need to bring some semblance of order to this thread and stop the bickering.

[apeiron]

Apieron, you need to cite your sources too.

Where have I not done so when asked?

[Evo]

Where have I not done so when asked?Can you list the post numbers with the sources? Too many posts today for me to keep up. I figure this is a better approach than me shutting down the thread in order to have time to read back though it and validate all sources before re-opening.

Thanks.

[apeiron]

Can you list the post numbers with the sources?

I haven't made any unsourced claims that have been challenged.

Glenn made a couple of claims that were contradictory to the study which is the subject of the OP:

with the effect being that oil is practically an inexhaustible resource

Global proved oil reserves have grown every year since they began collecting the data using current methodology at the turn of the century. This means that we are finding new, economically exploitable oil (at current price and technology levels) faster than we are drilling it up.

His reference to back up these claims turned out to be a peak oiler study from the previous century which concluded quite the reverse of what he purported.

He has yet to supply credible current figures.

He has not justified his use of the words "finding new" - although I accept it was probably just an over-eager way of saying reclassifying existing known probable (and largely unconventional) reverves to proven ones.

This reclassification issue is widely known, widely discussed. It is not hard to find public souces.

Making sensible estimates of actual useable oil is central to the OP study. If Glenn can raise a solid objection based on some source I have missed, then I would be interested.

[RonL]

This might put a little more information into the discussion of new production coming on line.
It has been known for some time, but technology has progressed enough to make the wells more likely to be successful. At least two things are going to be big factors in how quickly this play can be produced, (1.) having enough rigs to put wells in place, (2.) Having access to the very large volumes of water needed in the fracing process of long horizontal bores.

http://oilshalegas.com/eaglefordshale.html

BP just gave a good example of what resides below the Gulf of Mexico.

[talk2glenn]

He has yet to supply credible current figures.

http://tonto.eia.doe.gov/cfapps/ipdbproject/iedindex3.cfm?tid=5&pid=57&aid=6&cid=ww,&syid=1980&eyid=2009&unit=BB

1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

World 641.934 649.130 667.400 665.632 666.488 697.813 698.607 697.929 887.534 906.018 1,000.513 998.745 989.443 996.105 998.336 999.261 1,007.368 1,018.515 1,020.075 1,032.753 1,016.772 1,028.132 1,031.954 1,213.112 1,265.026 1,277.228 1,292.936 1,316.662 1,332.043 1,342.207

I aplogize for the lack of formatting in the copy/paste job, but if you follow the link directly you will find it more neatly organized.

Clearly, this data is in line with my claims. I did not know I was making any claim which was so controversial as to require sourcing; it is relatively common knowledge that world reserves today are larger than they were in the past.

The DOE data only goes through 1980, but I can assure you that the trend is the same however far back one goes.

although I accept it was probably just an over-eager way of saying reclassifying existing known probable (and largely unconventional) reverves to proven ones.

This is not accurate. Existing known probable reserves do not exist, as an international standard or otherwise. The only standard is the prescisely defined proved reserves, which are subject to regulation and verification. Proved reserves are not simply "reclassifications" of "known probably" reserves. When we talk of "probable" oil supplies we are engaging in idle speculation, nothing more. There is probably oil in my backyard; that does not mean anyone should try to factor that into measured global reserves.

[talk2glenn]

But what happens when gas gets up to $6/gallon next time?

I imagine you've answered your own question. As observed, there were consumer and producer reactions following the roughly 100% appreciation in gas prices which resulted in a 25% price depreciation to a new equilibrium level 50% above the baseline.

If gas prices were to appreciate further, I imagine the reaction would be the same: consumers would continue to move towards more fuel efficient vehicles, and/or change their driving habits, while suppliers would take steps to increase the amount of gas available to the market.

Remember also that there are policy barriers that prevent consumers and producers from changing their behavior quickly and efficiently, as is expected in ideal market conditions and modeled in economic theory. These regulatory and bureacratic hurdles are less efficient in their response to changing market circumstances, and serve to exacerbate the effects of rapid short-term price variance. In the medium and long runs, however, we can generally assume that governments will yield to market forces through policy changes and ultimately a market equilibrium will be established that preserves maximal market efficiency (at the most extreme, this might take several decades - see the Soviet Union).

And then there is the problem of immediate policy action intended by governments to mitigate the effects of price variations but which are counter-market mechanisms and ultimately serve only to exacerbate the corrective effects. For example, it was proposed by Sen. McCain during the gas crsis that the federal gasoline tax be temporarily suspended, and by others that the SPR be tapped. These two policy ideas would have had the effect of lowering gas prices in the short-term, but also discouraging the kinds of fundamental market changes that were necesarry to stabilize prices in the long-term.

These kinds of political circumstances can have dramatic, and typically dramatically negative, social consequences, but one must attribute fault correctly: they are government failures, not market failures. Indeed, we observe government-induced dramatic social events periodically throughout human history, in war, civil unrest, etc.

Western governments were, typically, relatively well insulated against these kinds of problems due to both the responsiveness of their bureacracies (as derided for inefficiency as they are, they are models of efficiency relatively speaking, and at least make an effort to make use of sound data in their policy decisions) and the market-oriented nature of their economies.

[apeiron]

Clearly, this data is in line with my claims. I did not know I was making any claim which was so controversial as to require sourcing; it is relatively common knowledge that world reserves today are larger than they were in the past.

It would be good if you could provide a source that backs up what you claim - that the rate of reserve increase has outstripped the rate of consumption.

But anyway, doing a quick calculation based on on...
http://tonto.eia.doe.gov/cfapps/ipdbproject/iedindex3.cfm?tid=5&pid=54&aid=2&cid=ww,&syid=2005&eyid=2009&unit=TBPD

and your....
http://tonto.eia.doe.gov/cfapps/ipdbproject/iedindex3.cfm?tid=5&pid=57&aid=6&cid=ww,&syid=1980&eyid=2009&unit=BB

You might want to check my maths but the story for 2009 appears to be an annual consumption of 30 billion barrels and an annual reserve increase of 10 billion barrels. Which if right, would rather undermine your position?

[apeiron]

Helping Glenn out with his research, the 2008 World Energy Outlook, the full text of which is now online, seems the best freely available official source.

http://www.worldenergyoutlook.org/docs/weo2008/WEO2008.pdf

Analysis starts p202. Here are some snippets.

According to BP, which compiles published official figures, proven reserves worldwide have almost doubled since 1980 (Figure 9.3). Most of the changes result from increases in official figures from OPEC countries, mainly in the Middle East, as a result of large upward revisions in 1986-1987. They were driven by negotiations at that time over production quotas and have little to do with the discovery of new reserves or physical appraisal work on discovered fields. The official reserves of OPEC countries have hardly changed since then, despite ongoing production.

Globally, remaining proven reserves have increased modestly but steadily since 1990, despite continuing consumption growth. According to O&GJ, reserves increased by 14.2 billion barrels, or 1.2%, in 2007, mainly thanks to upgrades in Venezuela, Brazil, Saudi Arabia, Kuwait, Iran and Angola. OPEC countries’ reserves, at 930 billion barrels based on official data, represent 77% of the world total (using the O&GJ estimate). The global reserves-to-production ratio (R/P), based on current levels of production, is in the range of 40 to 45 years, depending on the source and whether non-conventional resources are included. This level has changed little in the last few years.

A growing share of the additions to reserves has been coming from revisions to estimates of the reserves in fields already in production or undergoing appraisal(reserves growth) rather than from new discoveries (see the next section for a
discussion of the role of reserves growth). The volume of oil in new discoveries
has fallen well below the volume of oil produced in recent years (Figure 9.4).
Discoveries dropped from an average of 56 billion barrels per year in the 1960s to 13 billion barrels per year in the 1990s. The number of discoveries peaked in the 1980s, but it fell sharply in the 1990s.

The fall in both the number of discoveries and the volume of oil discovered has been most acute in the Middle East and the former Soviet Union. By contrast, discoveries rose in Africa, Latin America and Asia. The drop in discoveries worldwide was largely the result of a fall in exploration activity in the regions with the largest reserves (where access by international companies is most difficult) and a fall in the average size of the fields that have been found.

These factors more than offset the effect of an improved exploration drilling success
rate, which has increased by a factor of two in the last 50 years, from one out of six
wildcat wells to one out of three today (Harper, 2005). The downward trend in the
volume of oil found has reversed slightly in the current decade, thanks to increased
exploration activity (with higher oil prices), with an average 16.4 billion barrels per
year discovered since 2000. The excess of production over cumulative discoveries over the same period is 400 billion barrels.

[brainstorm]

Remember also that there are policy barriers that prevent consumers and producers from changing their behavior quickly and efficiently, as is expected in ideal market conditions and modeled in economic theory. These regulatory and bureacratic hurdles are less efficient in their response to changing market circumstances, and serve to exacerbate the effects of rapid short-term price variance. In the medium and long runs, however, we can generally assume that governments will yield to market forces through policy changes and ultimately a market equilibrium will be established that preserves maximal market efficiency (at the most extreme, this might take several decades - see the Soviet Union).

I hate to play the stratification card, but in my perception middle-class people were largely insulated against having to radically alter their lifestyle practices as a result of high gas prices. Yes, their budgets were affected by higher cost per tank, and they became more conscious of their driving choices and made choices to eliminate less essential trips. But this did not alter their fundamental approach to life, which was/is to drive around to most every activity and continue the urban-development practice of separating areas of work from residential areas and consumption. I suspect that if middle-class people had radically modified there consumption behavior to favor local businesses within walking/biking distance by actually walking/biking, investors would have noticed the trend and started thinking about expanding more local consumption, leisure, and work/job opportunities within gas-free distances from residences.

Ironically, the people who were hardest hit by the high gas prices, i.e. people with lower-income, do not stimulate (much) business investment because they don't spend as much money compared with middle-class consumers. So while more bicycle/walking/public-transit developments took place among lower-income consumers, business-investors didn't respond. In fact, they responded negatively by divesting in risky mortgage programs in order to re-establish investor confidence in middle-class lending.

Certainly there has been a very pro-active segment of middle-class people who have radically adjusted their lifestyle activities to pedestrian/bicycle transit, but business investment simply hasn't responded by generating more consumption and leisure opportunities that make these people as happy to live-local as they are to get in the car and go have an adventure, or at least go someplace else with something interesting to do. More importantly, workplaces have not moved or found other ways to make themselves 100% gas-free accessible to employees. Once this occurs, the economy will be oil-independent except for industrial applications and shipping.

[talk2glenn]

You might want to check my maths but the story for 2009 appears to be an annual consumption of 30 billion barrels and an annual reserve increase of 10 billion barrels. Which if right, would rather undermine your position?

You are quoting a net figure. That is, discoveries - production = net +10 bbl, for example.

A growing share of the additions to reserves has been coming from revisions to estimates of the reserves in fields already in production or undergoing appraisal(reserves growth) rather than from new discoveries...

This is hair-splitting. How does one differentiate between "new discoveries" and "estimate revisions"? Whether newly "discovered" oil is in existing or new fields is irrelevant to the point (which is, is that oil economically exploitable today).

There really is no distinction. It is a semantic argument, and serves no practical purpose except to reveal subjective biases in the authors. All other "conclusions" in the quoted paragraphs follow from this bad reasoning.

Imagine if I have a bag of peanuts. I cannot say how many peanuts are in that bag, but based on a survey of its contents, I reasonably estimate that it contains 1,000 peanuts. Some time later, after eating 900 peanuts, again I guage the contents of the bag, and find that it still seems to contain at least 1,000 peanuts. I report my peanut reserves at 1,000 initially, and 1,000 later. Both estimates are "accurate", in that they represent my best guess given the data and methodology available to me at the time. You can argue until you are blue in the face whether I actually "discovered" more peanuts, however, or had at least 1,900 peanuts the entire time, but this makes no practical difference; it is a philosophical argument, at best.

I hate to play the stratification card, but in my perception middle-class people were largely insulated against having to radically alter their lifestyle practices as a result of high gas prices.

Sure; I would agree. The share of an American middle class households income which goes towards fuel costs is pretty small. It would take a dramatic change in fuel prices, and no corresponding change in consumption patterns, before fuel prices would begin to have the kinds of dramatic effects you seem to want.

This will never happen. As transportation becomes more efficient, the share of household income devoted to fuel consumption should decline further, not increase. It would take a catastrophic reversal of this technical trend for this to change (as with food).

but business investment simply hasn't responded by generating more consumption and leisure opportunities that make these people as happy to live-local as they are to get in the car and go have an adventure, or at least go someplace else with something interesting to do

This is a reverse-causal argument. Business do not define the environments that make people happy; they respond to consumer demand for "happiness" to the extent that it is a marketable commodity by supplying luxury goods.

Consumers define what makes them happy. People prefer to drive than walk. This has always been the case, and will always be the case. All things being equal, driving or any other form of privatized transit (private planes, yachts, etc) is considered a more "luxurious" form of transportation than a public alternative. People are willing to pay for their privacy, and their exclusivity. You seem to imagine that this is the case because car dealers sold people cars. That is wrong; it is the case because consumers bought the cars. The supply always follows the demand, for obvious reasons.

If people would rather walk to the movies than drive to them, business would be happy to respond by building more theatres within walking distance. However, this would have a number of unintended effects which consumers would not like (and which I don't think you are considering). There would be fewer showings per theatre, and individual ticket prices would go up. Centralized megaplexes are more efficient than local boutiques. Movies being a normal good, consumers would rather have more of them than less; therefore we prefer a megaplex within driving distance to a boutique operation within walking distance. This would only change if the transportation costs became so expensive and/or unpleasant (ie, less luxurious via car and more painful via public bus) that it just wasn't worth the hassle of traveling to the megaplex uptown, and we settled for the neighborhood boutique. But clearly you can see how such a society is "less luxurious" (in that consumers are settling for less utility from their same, fixed normal consumption) than the one we have currently?

Again, businesses do not drive the environments we live in; consumers do. Businesses just respond by giving people the products they want. To the extent that governments force non-market models on consumers due to motivations which are political, rather than economic, the consequence tends to be a lower standard of living, as in the crude "trip to the movies" example above.

[brainstorm]

Sure; I would agree. The share of an American middle class households income which goes towards fuel costs is pretty small. It would take a dramatic change in fuel prices, and no corresponding change in consumption patterns, before fuel prices would begin to have the kinds of dramatic effects you seem to want.
You got me. There are multiple reasons beyond oil-dependency that I would like to see automotive transit become less dominant. However, this doesn't change the fact that doing so would also achieve better oil-independence, which would help insulate against future scarcity and price-spikes.

This is a reverse-causal argument. Business do not define the environments that make people happy; they respond to consumer demand for "happiness" to the extent that it is a marketable commodity by supplying luxury goods.
You're thinking abstract instead of concrete. I actually get around by bike and walking so I think about how much happier it would make me if there was more to do close by. The correlate of this is that the lack of things to do close by impedes the choice to bike/walk for my neighbors.

Consumers define what makes them happy. People prefer to drive than walk.
They do when gas is cheap, cars are readily available, traffic is good, and they don't have to be concerned about oil-wars, oil-spills, obesity, or other health problems related to over-reliance on driving.

This has always been the case, and will always be the case. All things being equal, driving or any other form of privatized transit (private planes, yachts, etc) is considered a more "luxurious" form of transportation than a public alternative. People are willing to pay for their privacy, and their exclusivity. You seem to imagine that this is the case because car dealers sold people cars. That is wrong; it is the case because consumers bought the cars. The supply always follows the demand, for obvious reasons.
I think you're assuming a lot on the basis of all the self-reinforcing aspects of automotive culture. Plus it's just not economically sustainable if prices go up again. Look how badly the economy did at just $4/gallon.

If people would rather walk to the movies than drive to them, business would be happy to respond by building more theatres within walking distance. However, this would have a number of unintended effects which consumers would not like (and which I don't think you are considering). There would be fewer showings per theatre, and individual ticket prices would go up. Centralized megaplexes are more efficient than local boutiques. Movies being a normal good, consumers would rather have more of them than less; therefore we prefer a megaplex within driving distance to a boutique operation within walking distance.
So you're basically saying that cinema attendance preferences will ensure sufficient demand and economic means of maintaining an automotive culture that allows people to drive a ways to a megaplex?

This would only change if the transportation costs became so expensive and/or unpleasant (ie, less luxurious via car and more painful via public bus) that it just wasn't worth the hassle of traveling to the megaplex uptown, and we settled for the neighborhood boutique. But clearly you can see how such a society is "less luxurious" (in that consumers are settling for less utility from their same, fixed normal consumption) than the one we have currently?
I think luxurious is relative and that if people's cultural experiences shifted in a way that they were satisfied with more local excursions, they would be happy not to have the hassles and expense of driving and use that time, money, effort, and headache for other things. Plus, they would be able to weather high gas prices without (much) deprivation.

Again, businesses do not drive the environments we live in; consumers do. Businesses just respond by giving people the products they want. To the extent that governments force non-market models on consumers due to motivations which are political, rather than economic, the consequence tends to be a lower standard of living, as in the crude "trip to the movies" example above.
That's what I was trying to explain in my previous post. Middle-class consumers could have driven business investment if they had sufficiently changed their behavior, which they didn't because they were relatively insulated by their high incomes relative to lower-income people. Lower income people DID change their behavior more, but their low-income prevents them from driving business investments to cater to them. This is why I called it a class-stratification problem.

[apeiron]

You are quoting a net figure. That is, discoveries - production = net +10 bbl, for example.


OK, but the point is still that this is not "discoveries".

Firstly, proved reserves are created by oil industry action. It is a book-keeping exercise in which you keep ahead of your production by qualifying a sensible amount of your probable reserves by actually getting out into the field and doing the necessary testing.

Secondly, the "discoveries" as you keep putting it include a mix of things. There are new estimates of recovery levels, the validation of long-discovered probable resources, new views of market prices that make long-discovered probable resources worth adding to the imminent exploitation list. And then some element of actual new discoveries.

Now what I was asking for - to back up your original phrasing of the situation - is that there is indeed no need to worry, peak oil is a myth, the supply is for all purposes unlimited, because we are still finding way more oil than we are using.

Now everything I read is about how official reserve figures are untrustworthy and the true picture, as far as it can be made out, is that there is very little new cheap oil discovery and most of any hope is being pinned on unconventional oil - precisely the stuff that is expensive and dirty.

So even if the peak can theoretically be delayed, the geopolitical consequences of moving into a new petroleum exploitation regime could be huge.

Which is why it is essential that you come up with your own credible sources that support your view.

Anyway, here are some futher sources to support my view.

Even tight US definitions of reserves are shonky...(your friend, Laherrere)....
Present probability of US proved reserves is about 50%, far from the SPE/WPC
definition of proved = 90%, and the maximum value is 75% once.
It means that Reasonable varies from less than 50% to 75 %!
http://www.hubbertpeak.com/Laherrere/ASPO2006-JL-long.pdf

And here Laherrere says it explicitly (check his graphs)....politically-inspired revisions vs the actual discovery story....

Political data is always rising from 1950 to now, when from the technical sources, oil
remaining reserves has peaked in 1980! It is well recognized by almost every IOC that,
since 1980, oil discovery is less than oil production

The same data annually shows very well the artefacts of political reporting, compared to the truth, which is that finding new reserves is a nightmare for oil companies (Scaroni 2006) and that since 1980 the world oil production is much higher than oil discovery.

It is interesting to find that major companies or official agencies which claims that peak oil is decades away, quote always old works by others, never their own. Exxon-Mobil 2006 quotes USGS 2000 (10 years old as being at end of 1995), Shell in 2002 quoted EneRG (1999), IEA in 2005 quoted Shell 2002! IFP quotes Wood Mac! Is it to say, if found wrong, that it is not their works?

Medias and politicians claimed that there is oil for the next 40 years and gas for 60
years, but it is using proved reserves from political or financial sources. The ratio is
different when using technical data (backdated mean). As mean annual discovery can be
modelled with several cycles, and production mimics discovery with a certain lag, the
R/P is trending towards an asymptote depending upon the width of the last cycle.

R/P from US proved reserves is about 10 years since the last 80 years, showing that
this ratio is useless for forecasting.....The last US barrel will be produced with still 9 barrels reserves in the ground, barrels that will then go back to resource status.

Many examples lead to conclude that the US reserve growth is mainly bad reporting and that the USGS claim of 730 Gb of world reserve growth obtained by applying this poor
and obsolete US proved growth to proved + probable reserves is scientifically wrong.
All forecasts using USGS 2000 results (at end 1995) are highly unreliable. A new world
assessment is a must.

This separate powerpoint has a bunch of the standard graphs from p14 on. They illustrate the basic claim that consumption > discovery. All the talk otherwise is based on political fiddling of the books.

http://www.sust.sbg.ac.at/download/sschool02/w_zittel_oil.ppt#269,14,Slide 14

[talk2glenn]

You're thinking abstract instead of concrete. I actually get around by bike and walking so I think about how much happier it would make me if there was more to do close by. The correlate of this is that the lack of things to do close by impedes the choice to bike/walk for my neighbors.

Your preferences and aggregate preferences do not necesarilly align, but surely you would be unhappy if you had to walk/bike everywhere (not just when the mood suited you), regardless of where you were going, why, or in what conditions? If you're going to the ball and it is raining, would you prefer to walk or drive? And if we agree that you would rather drive, again all things being equal, would you rather take the bus or ride in your own car?


They do when gas is cheap, cars are readily available, traffic is good, and they don't have to be concerned about oil-wars, oil-spills, obesity, or other health problems related to over-reliance on driving.

This is all ancillary. All things being equal, consumers would rather drive than walk (you can basically assume the ceterus perebus condition whenever anybody makes a simple statement, which is why we don't routinely include it in argument). The variables you describe determine the proportion to which consumers in a given market divide their travel time between driving and walking. Just because you would prefer to do something, doesn't mean that you can or will. Remember opportunity costs.


I think you're assuming a lot on the basis of all the self-reinforcing aspects of automotive culture. Plus it's just not economically sustainable if prices go up again. Look how badly the economy did at just $4/gallon.

Again, this is ancillary. I may not able to drive everywhere if gas prices rose to $10/gal, but I would still rather do so. I cannot afford to fly first class every time I go home for the holidays, and I in fact do not. However, if I could, I would.


So you're basically saying that cinema attendance preferences will ensure sufficient demand and economic means of maintaining an automotive culture that allows people to drive a ways to a megaplex?

As a simple explanation of urban development, yes. Because large, centralized distribution hubs are inherently more efficient (less is more, in business terms, given that the capital costs of opening a new store can be considered basically fixed, while the per-operation revenue potential is negatively sloped), it follows that the ability to travel over large distances cheaply and quickly contributes to greater aggregate economic performance. Cars effectively enable a single supermarket to serve a larger community with groceries; a single office building to serve a larger community with jobs; etc.


I think luxurious is relative and that if people's cultural experiences shifted in a way that they were satisfied with more local excursions, they would be happy not to have the hassles and expense of driving and use that time, money, effort, and headache for other things. Plus, they would be able to weather high gas prices without (much) deprivation.

Sure, what is luxury is relative, but luxury itself is not. It can be uniformly defined as "more utility is preferential to less". Therefore, any market outcome that increases utility/dollar is necesarilly more luxurious for consumers than the alternative, whether that means you have lowered the cost of slasher movies or roller coaster rides (we are assuming for a moment that the amount of dollars available to purchase goods is fixed). Not everyone will agree that things are better, but the consumers in aggregate will have reached a higher level of utility.


That's what I was trying to explain in my previous post. Middle-class consumers could have driven business investment if they had sufficiently changed their behavior, which they didn't because they were relatively insulated by their high incomes relative to lower-income people. Lower income people DID change their behavior more, but their low-income prevents them from driving business investments to cater to them. This is why I called it a class-stratification problem.

Thems the shakes. Lower income individuals consume less than their wealthier counterparts, therefore it is reasonable to expect that there will be fewer goods and services available to them.

[talk2glenn]

Now everything I read is about how official reserve figures are untrustworthy and the true picture, as far as it can be made out, is that there is very little new cheap oil discovery and most of any hope is being pinned on unconventional oil - precisely the stuff that is expensive and dirty.

I am sorry, but we have effectively reached the end of the argument. Your criticisms here are not technical; you have basically said you reject my conclusions because the data is, in your opinion, untrustworthy. Anybody can say "I don't trust the data, because it does not conform to my expected world view".

Given that this data is provided by the strongest sources in the field (large corporations, government agencies, etc), subject to peer review (to the extent anything as proprietary as oil reserves can be) and according to standardized definitions and methodologies, it is as good as we are going to get.

In the absence of competing data on world oil reserves that we can agree is "stronger" and which demonstrates apparently different circumstances, I think we have to pretty much say, game over man.

[apeiron]

I am sorry, but we have effectively reached the end of the argument. Your criticisms here are not technical; you have basically said you reject my conclusions because the data is, in your opinion, untrustworthy. Anybody can say "I don't trust the data, because it does not conform to my expected world view".

Given that this data is provided by the strongest sources in the field (large corporations, government agencies, etc), subject to peer review (to the extent anything as proprietary as oil reserves can be) and according to standardized definitions and methodologies, it is as good as we are going to get.

In the absence of competing data on world oil reserves that we can agree is "stronger" and which demonstrates apparently different circumstances, I think we have to pretty much say, game over man.

It's been game over ever since your first failure to present some actual source for your original claim. Your first cite in fact contradicted you flatly. Your second was just a trend line for proven reserves, not rate of discover vs rate of consumption.

I can't reject data that you can't provide :zzz:.

But I've had no trouble citing industry experts who have quite clearly said consumption has outstripped discovery for a long time, that proven reserves are not such a great benchmark for discussing this issue, that we are talking about pinning our optimism on expensive/dirty unconventional oil, etc.

[apeiron]

Regarding cost for nuclear, this varies considerably by country, another reason why addressing the problem world wide is complicated. In the US yes nuclear capital costs appear to be $5-7 / W(e). However China is throwing up PWBs for $1.6/W(e), or $1.6B for a one GW(e) reactor (as pointed out by signerro (http://www.physicsforums.com/showpost.php?p=2115378&postcount=115)r)


An interesting paper challenging your view of the economics of nuclear is...
http://www.vermontlaw.edu/Documents/Cooper%20Report%20on%20Nuclear%20Economics%20FINAL %5B1%5D.pdf

While some have called for the construction of 200 to 300 new nuclear reactors over the next 40 years, the much more modest task of building 100 reactors, which has been proposed by some policymakers as a goal, is used to put the stakes in perspective. Over the expected forty-year life of a nuclear reactor, the excess cost compared to least-cost efficiency and renewables would range from $19 billion to $44 billion per plant, with the total for 100 reactors reaching the range of $1.9 trillion to $4.4 trillion over the life the reactors

And then this paper that argues PV now has a stronger case than nuclear.....
http://www.ncwarn.org/wp-content/uploads/2010/07/NCW-SolarReport_final1.pdf

It is also interesting what it has to say about the hidden costs of nuclear.

Here, the market seems to be speaking!...

The Institute for Southern Studies reported
that as of July 2009 two of the 17 proposed
nuclear projects have had their construction
bonds rated as “junk” status and 13 others are
rated as just one step above junk.

I didn't realise the US taxpayer insured the industry...

The nuclear industry insists on taxpayer insurance
against catastrophic accidents. The
Price-Anderson act caps the liability for an
accident at a level that now totals approximately
$11 billion, which would be distributed
among all reactor owners. Federal studies
estimate that the damage from non-worst
case accidents could exceed $500 billion.

Some in Congress want to do even more. A
new analysis conducted for Friends of the
Earth shows that tax breaks totaling $9.7 billion
to $57.3 billion (depending on the type
and number of reactors) would come on top
of proposed subsidies totaling $35.5 billion
in the Kerry-Lieberman bill. If this bill succeeds,
nuclear plant owners might essentially
bear no risk.

[mheslep]

An interesting paper challenging your view of the economics of nuclear is...
http://www.vermontlaw.edu/Documents/Cooper%20Report%20on%20Nuclear%20Economics%20FINAL %5B1%5D.pdf
Challenges what view? That the construction cost of a US reactor is $5-7/W(e) How?

Cooper's estimate that a nuclear plant's operational cost of up to $44B/40 years more than renewables doesn't seem reasonable to me. I'm curious how he comes to that figure, but I'm not inclined to plough through his 78 pg report on nuclear power when we have other references (http://web.mit.edu/nuclearpower/), unless you want focus on some particular data he presents.

Cooper appears to be a consumer advocate, concentrating on issues like open media and telecom besides this. That's fine, but I'd rather spend time reading scientists, engineers and economists on this one.

[apeiron]

An interesting new forecast by Kuwaiti oil engineers predicts peak conventional oil in 2014.


The world production is estimated to peak in 2014 at a rate of 79 MMSTB/D. OPEC has remaining reserve of 909 BSTB, which is about 78% of the world reserves. OPEC production is expected to peak in 2026 at a rate of 53 MMSTB/D. On the basis of 2005 world crude oil production and current recovery techniques, the world oil reserves are being depleted at an annual rate of 2.1%.

http://pubs.acs.org/stoken/presspac/presspac/full/10.1021/ef901240p

It adds to the chorus of concern coming now from authorative sources....

http://peakoiltaskforce.net/wp-content/uploads/2010/02/final-report-uk-itpoes_report_the-oil-crunch_feb20101.pdf

http://www.jfcom.mil/newslink/storyarchive/2010/JOE_2010_o.pdf

http://www.chathamhouse.org.uk/files/16720_0610_froggatt_lahn.pdf

[mheslep]

An interesting new forecast by Kuwaiti oil engineers predicts peak conventional oil in 2014.



It adds to the chorus of concern coming now from authorative sources....

http://peakoiltaskforce.net/wp-content/uploads/2010/02/final-report-uk-itpoes_report_the-oil-crunch_feb20101.pdf

http://www.jfcom.mil/newslink/storyarchive/2010/JOE_2010_o.pdf

http://www.chathamhouse.org.uk/files/16720_0610_froggatt_lahn.pdfDid you actually compare the Kuwaiti estimates against any of the others?

I looked at one, Brazil, and the Kuwaitis are already falling substantially short of actual production figures. Here's the Kuwaiti estimate for Brazil, in which their model produces a peak production estimate of 2.0 mbbl/d this year, 2010.

Figure 17. Brazil crude oil production model:
http://pubs.acs.org/appl/literatum/publisher/achs/journals/content/enfuem/2010/enfuem.2010.24.issue-3/ef901240p/production/images/medium/ef-2009-01240p_0030.gif

Here's EIA, showing actual production in 2008 was 2.4 mbbl/d, already exceeding the Kuwaiti prediction, and by this year will likely be ~2.8 mbbl/d.

http://www.eia.doe.gov/cabs/Brazil/images/br_production.gif
http://www.eia.doe.gov/cabs/Brazil/Oil.html


Given the well known rapid development of Brazil's offshore oil, seem's like they should have tossed this model away and started over when it produced a 2010 peak. Petrobas, the Brazillian oil co, estimates (http://www.washingtonpost.com/wp-dyn/content/article/2009/12/06/AR2009120602442.html): that production in Brazil could reach 3.9 million barrels by 2020
That's the incumbent oil company, but it they're right the Kuwait paper is off nearly 100%. As the kids say, duh?

[apeiron]

Could this be the reason for the discrepancy?

In 2008, Brazil produced 2.4 million barrels per day (bbl/d) of oil, of which 76 percent was crude oil.

http://www.eia.doe.gov/cabs/Brazil/Oil.html

The Kuwaiti study looks at only crude. And 76% brings the actual oil barrels back to 1.8 mbd.

I think you will find that the EIA figure includes .45 mbd of ethanol.

[mheslep]

Could this be the reason for the discrepancy?



The Kuwaiti study looks at only crude. And 76% brings the actual oil barrels back to 1.8 mbd.

I think you will find that the EIA figure includes .45 mbd of ethanol.Good point, I missed that, however, the EIA 2010 crude estimate is then 2.12 mbbl/day using the same fraction of crude, with no indication of a peak occurring this year, and certainly not from the Petrobas estimate of 3.9 mbbl/day by 2020 as reported in the WaPo.

[apeiron]

Good point, I missed that, however, the EIA 2010 crude estimate is then 2.12 mbbl/day using the same fraction of crude, with no indication of a peak occurring this year, and certainly not from the Petrobas estimate of 3.9 mbbl/day by 2020 as reported in the WaPo.

Well the beauty of all this is we only have to wait a few years to discover whether the EIA and Petrobas have got it right or are exaggerating.

http://pubs.acs.org/appl/literatum/publisher/achs/journals/content/enfuem/2010/enfuem.2010.24.issue-

[sorry, fig 29 - I'll have to learn how to embed images here]

As an aside, this chart nicely confirms the increasing importance of the middle east as we slither down the other side of Hubbert's peak.

I wonder what China and India think at nights as they look at this graph?

[mheslep]

This cite claims to be reporting 2009 Petrobas data here for crude:
http://www.greencarcongress.com/2010/01/petrobras-oil-20100120.html
Oil production only topped-out at the daily average of 1,970,811 barrels, a 6.3% increase over 2008, when the average was 1,854,655 barrels per day.

[apeiron]

This cite claims to be reporting 2009 Petrobas data here for crude:
http://www.greencarcongress.com/2010/01/petrobras-oil-20100120.html

So is this a good test case now?

The model predicts a peak pretty much this year at about 2mbd. But if Petrobas managed to continue its growth rate of the past few years of 5/6 percent, then it should bust through this year to around 207mbb. And 217mbb in 2011.

Someone has got to be wrong! And very soon.

[mheslep]

So is this a good test case now?

The model predicts a peak pretty much this year at about 2mbd. But if Petrobas managed to continue its growth rate of the past few years of 5/6 percent, then it should bust through this year to around 207mbb. And 217mbb in 2011.Eh, 207 mbb/d? 2.07mbb/d?

[mugaliens]

Sounds about right. I looked into this in depth eleven years ago, researching a lot of data (raw data (not results from other studies), and from many different sources. I wound up with much the same, with peak oil around 2018, but my conclusions included severe shortages in the mid to late 20s, with a virtual cessation due to depletion by the mid-40s (2046). That was a decade ago, though, so the supplies and usage may have changed somewhat from what was being predicted back then.

[apeiron]

Sounds about right. I looked into this in depth eleven years ago, researching a lot of data (raw data (not results from other studies), and from many different sources. I wound up with much the same, with peak oil around 2018, but my conclusions included severe shortages in the mid to late 20s, with a virtual cessation due to depletion by the mid-40s (2046). That was a decade ago, though, so the supplies and usage may have changed somewhat from what was being predicted back then.

So are you battening down the hatches? Do you have a view on how the next 30 years are going to work out in terms of energy/economy/politics?

[mugaliens]

So are you battening down the hatches? Do you have a view on how the next 30 years are going to work out in terms of energy/economy/politics?

Somewhat. Here's the vehicle I'd like to own next (http://www.aptera.com/). Given its efficiency and the low $/erg of electricity, it's well worth it.

I must admit, though, I'm more partial to this beast (http://www.youtube.com/watch?v=nLV8WA-5PKo)... :)

[apeiron]

After the US JOE report, now the German army is talking about peak oil....

http://www.spiegel.de/international/germany/0,1518,715138,00.html


The study is a product of the Future Analysis department of the Bundeswehr Transformation Center, a think tank tasked with fixing a direction for the German military. The team of authors, led by Lieutenant Colonel Thomas Will, uses sometimes-dramatic language to depict the consequences of an irreversible depletion of raw materials. It warns of shifts in the global balance of power, of the formation of new relationships based on interdependency, of a decline in importance of the western industrial nations, of the "total collapse of the markets" and of serious political and economic crises.

According to the German report, there is "some probability that peak oil will occur around the year 2010 and that the impact on security is expected to be felt 15 to 30 years later."

In the long run, the study goes on, the global oil market, will only be able to follow the laws of the free market in a restricted way. "Bilateral, conditioned supply agreements and privileged partnerships, such as those seen prior to the oil crises of the 1970s, will once again come to the fore."

Since virtually all economic sectors rely heavily on oil, peak oil could lead to a "partial or complete failure of markets," says the study. "A conceivable alternative would be government rationing and the allocation of important goods or the setting of production schedules and other short-term coercive measures to replace market-based mechanisms in times of crisis."

Even more explosive politically are recommendations to the government that the energy experts have put forward based on these scenarios. They argue that "states dependent on oil imports" will be forced to "show more pragmatism toward oil-producing states in their foreign policy." Political priorities will have to be somewhat subordinated, they claim, to the overriding concern of securing energy supplies.
For example: Germany would have to be more flexible in relation toward Russia's foreign policy objectives. It would also have to show more restraint in its foreign policy toward Israel, to avoid alienating Arab oil-producing nations. Unconditional support for Israel and its right to exist is currently a cornerstone of German foreign policy.

[mheslep]

Most of the news in the OP Mahr study is regarding peak coal. Mahr has world peak coal at between 2010 and 2050. Yet from EIA we have:
Based on U.S. coal consumption for 2008, the U.S. recoverable coal reserves represent enough coal to last 234 years. However, EIA projects in the most recent Annual Energy Outlook (April 2009) that U.S. coal consumption will increase at about 0.6% per year for the period 2007-2030. If that growth rate continues into the future, U.S. recoverable coal reserves would be exhausted in about 146 years if no new reserves are added.
http://www.eia.doe.gov/energyexplained/index.cfm?page=coal_reserves
I'm not certain about the definition of 'last', likely EIA is referring to exhaustion and certainly not years to peak. And this is just a US estimate. However, Mahr's peak is mainly based on a nebulous country category he labels 'Rest', for which production is high for a a couple of decades and then vanishes. If we take away the 'Rest' category of coal producers, then world coal production is relatively flat out to 2100 even using his model.

[mugaliens]

Most of the news in the OP Mahr study is regarding peak coal. Mahr has world peak coal at between 2010 and 2050. Yet from EIA we have:

http://www.eia.doe.gov/energyexplained/index.cfm?page=coal_reserves
I'm not certain about the definition of 'last', likely EIA is referring to exhaustion and certainly not years to peak. And this is just a US estimate.

This is based upon known and anticipated coal reserves at expected coal usage rates, not the rates of usage if coal were required to replace petroleum usage after peak oil.

[mheslep]

This is based upon known and anticipated coal reserves at expected coal usage rates, not the rates of usage if coal were required to replace petroleum usage after peak oil.I saw nothing about replacing oil with coal in the Mahr study per the OP.

[jwxie]

I remember a few years ago they said the fossil fuels will last by 2040. I guess this was a combination of all types of fuels???

LOL. This is scary. But there are new sites being discovered....
One thing that I don't understand about nuclear energy. How do they power it up, without electricity? LOL

[mugaliens]

I saw nothing about replacing oil with coal in the Mahr study per the OP.

Exactly. If we had to do that, we'd be through the coal in much less time.

[apeiron]

Forbes interviews Charles Maxwell, senior energy analyst at Weeden & Co, on peak oil (and why to invest in oil sand companies).

http://www.forbes.com/2010/09/13/suncor-energy-oil-intelligent-investing-cenovus.html

snippet..........

The use of petroleum in the world is now up to about 30 billion barrels per year. The rate at which we have found new supplies of petroleum over the last 10 years has fallen to an average, of only about 10 billion barrels per year.
We're obviously in an unsustainable situation. We are now using up a greater number of barrels that we have found in the recent past and that we have reserved in the ground. We are now beginning to use it up relatively quickly--with scary consequences for the future.

A bind is clearly coming. We think that the peak in production will actually occur in the period 2015 to 2020. And if I had to pick a particular year, I might use 2017 or 2018. That would suggest that around 2015, we will hit a near-plateau of production around the world, and we will hold it for maybe four or five years. On the other side of that plateau, production will begin slowly moving down. By 2020, we should be headed in a downward direction for oil output in the world each year instead of an upward direction, as we are today.

[nismaratwork]

Forbes interviews Charles Maxwell, senior energy analyst at Weeden & Co, on peak oil (and why to invest in oil sand companies).

http://www.forbes.com/2010/09/13/suncor-energy-oil-intelligent-investing-cenovus.html

snippet..........

The use of petroleum in the world is now up to about 30 billion barrels per year. The rate at which we have found new supplies of petroleum over the last 10 years has fallen to an average, of only about 10 billion barrels per year.
We're obviously in an unsustainable situation. We are now using up a greater number of barrels that we have found in the recent past and that we have reserved in the ground. We are now beginning to use it up relatively quickly--with scary consequences for the future.

A bind is clearly coming. We think that the peak in production will actually occur in the period 2015 to 2020. And if I had to pick a particular year, I might use 2017 or 2018. That would suggest that around 2015, we will hit a near-plateau of production around the world, and we will hold it for maybe four or five years. On the other side of that plateau, production will begin slowly moving down. By 2020, we should be headed in a downward direction for oil output in the world each year instead of an upward direction, as we are today.

Well, that should make for a nice brisk world war... :cry:

[CAC1001]

From what I've read, we can replace a lot of uses for petroleum with natural gas, we also have nuclear power, also there is a tremendous amount of shale oil and tar sands oil, extraction is just more costly, I've read we can actually synthesize our own hydrocarbons by taking carbon from the air and hydrogen from the water, it is just very costly right now and the infrastructure isn't there.

They are also experimenting with ways to produce hydrocarbons from I think forms of algae or something like that in the oceans (don't know how much could be produced from them though).

[apeiron]

From what I've read, we can replace a lot of uses for petroleum with natural gas, we also have nuclear power, also there is a tremendous amount of shale oil and tar sands oil, extraction is just more costly, I've read we can actually synthesize our own hydrocarbons by taking carbon from the air and hydrogen from the water, it is just very costly right now and the infrastructure isn't there.

They are also experimenting with ways to produce hydrocarbons from I think forms of algae or something like that in the oceans (don't know how much could be produced from them though).

Ahh, the magic of science, unchecked by the laws of thermodynamics.

All sorts of things are chemically possible. The debate here is about what is economically practical.

[Andre]

Ahh, the magic of science, unchecked by the laws of thermodynamics.

All sorts of things are chemically possible. The debate here is about what is economically practical.

Maybe the debate should also be about what is fear-technical emotional feasible? Without that factor, we might have been happily enjoying nuclear power in prosperity and not worry a second about peak fuels and emissions.

[CAC1001]

Ahh, the magic of science, unchecked by the laws of thermodynamics.

All sorts of things are chemically possible. The debate here is about what is economically practical.

Shale oil and tar sands, or even sythesizing oil, are not economically viable now, but by the time we will need to start using them, they probably will be; also the technologies will be significantly more advanced by then I'd imagine.

[Argentum Vulpes]

Shale oil and tar sands, or even sythesizing oil, are not economically viable now, but by the time we will need to start using them, they probably will be; also the technologies will be significantly more advanced by then I'd imagine.

I know with shale oil and tar sands the most cutting edge way of processing them is with wet steam in situ. And the biggest cost in synthetic oil is the process heat.

So to get the costs of these fuel sources down just requires a large amount of cheep low cost per Mw unit of heat. There is a technology out there that dose it, just need to get the "fear" of it straighted out.

[mugaliens]

Maybe the debate should also be about what is fear-technical emotional feasible? Without that factor, we might have been happily enjoying nuclear power in prosperity and not worry a second about peak fuels and emissions.

Agreed. Unfortunately, a significant portion of litigation is unnecessary, in part fueled by fears originally held by the litigants, and in part fuelde by fears artificially exacerbated by legal representation. Not all lawyers do this, and most probably do not. It is, however, a factor.

I'm not sure how much of the litigation which halted nuclear development here in the US was either overinflated or unnecessarily raised the cost of nuclear power so much that it was no longer economically feasible as compared to other forms of power production. I do know that at one time it was being billed as cheap power.

[apeiron]

Cheap energy = easy economic growth. So peak fossil fuels can be read as a century-long economic super-bubble. And a super correction is thus what we soon face.

So if you want to put your faith in nuclear or alternatives, you have to come up with a credible analysis both of their basic EROEI (energy returned on energy invested - cheap energy has got to be better than 10:1), and whether they can be ramped up fast enough to fill the coming energy gap.

Here are some remarks on this issue from the current ASPO-USA meeting....

http://www.theoildrum.com/node/7035


Following a break, Dr Robert Hirsch chaired a session on the link between Energy and the Economy, and it was possibly the bleakest of the meeting. Chris Martenson talked about looking at the economy as a straight highway, and then hitting a bend. While models often see progress in linear terms life does not turn out that way. Money is loaned into existence and credit (and thus debt) has increased over time. Since 1970 it has doubled five times. Money and energy have been tied, but while money must continue to grow, energy cannot. Credit market growth (with an R^2 of 0.98) has an exponential relationship with time. He sees the problem not with the individual smaller bubble causes of housing, etc but rather the overall credit size itself.

He sees the problems coming in the 2014-2015 time frame when Peak Oil will be recognized and while growth may continue, prosperity may not.

He was followed by Nicole Foss- who many of us have read under the pen name Stoneleigh. She sees fossil fuels as generating the largest bubble in history. The economy has been driven up by energy, but as that declines what will take its place? In the sense that bubbles are Ponzi schemes where only early investors make a return on their investment, as this one comes to an end as the largest suckers get fleeced, so they collapse to general hurt.

Markets are driven by perception rather than reality. But by the time the general public hears of “a good thing” it is generally over. Hearing the “it’s a new paradigm” should warn you to sell the stock. But the world is driven on emotion. And when there is a collapse it is often sudden, bringing the value down below what it was before the bubble began. (And oil prices are following this model.) From this she could see nothing ahead but progress into a deflation and depression. We are already in a large debt and liquidity trap and as credit disappears the depression will develop and be sustained. The huge derivatives market may be the first to go, given its insignificant intrinsic value.

The problem is in part that it will be based on reducing volumes of oil, and with that reduction there is no possibility of a rebound, since the resource is not there to develop it. Oil has thus hegemonic power. The depression will, however, sustain its dominance since reduced demand will allow it to remain dominant.

The final speaker of the evening was Robert Hirsch, who has also recently co-authored a book – The Impending World Energy Mess which was available in signed copy at the meeting. In large measure his talk followed the book (from which you may gather that I did buy, and have half-read, a copy – and it is worth doing so, I may do a review later). He noted that the economy depends on energy, not the other way around. Further we should expect that the general public will still be surprised when oil supplies start to decline in the next 2 – 5 years. From then they will continue to decline for at least a decade, until alternate sources of fuel become sufficiently available. He covered the oil problem, including their forecast of how it will develop, and what an individual could do about it.

The story is a familiar one to the peak oil community: we are over reliant on a few giant oil fields that are depleting and not being replaced. We have been sensibly in a production plateau since 2005, something not predicted by earlier models, but there are an increasing number of reputable sources that see an end to the plateau, and the consequent decline, coming relatively soon. This will impact GDP and hurt national economies. The recent recession and drop in oil demand may have only shifted the onset of the decline by a few weeks.

It is unrealistic to expect a rapid answer to the decline from politicians. Looking at the likely rate of decline, a 2% fall could be easily handled, a 4% fall could be handled with difficulty, but at 6% it is going to be bad. They have had to guess, and think, at the moment that it will likely be at around 4%.

China, having foreseen this problem, are doing smart things to prepare for it. We in the West are not. It will lead to increased tensions – though they did not look at the potential for resource wars, or the likelihood that producers would withhold production for political or economic reasons.

Looking at individual response, we should all expect to be impacted, and because of the lack of political ability to resolve the issue (or even to address it yet) we should expect that the result will be very similar to the oil shortages of the 70s. There was a degree of panic – this will happen again. This time, however, there will be no North Sea or North Slope to come to the rescue. Nor can the oil taps be opened wider to remediate the problems. As a result he has got out of the market – since good stocks and bonds will be hurt as well as bad. He has added annuities to his portfolio, bought some gold, and moved closer to mass transit and the shops.

He reminded us that this is a liquid fuels problem, while most renewables (wind and solar and hydro) deal with the electricity supply, which is not helpful to the crisis. We also have enough food. The issue is in transportation where we need a substitute for oil.

In questions he was asked about rationing. He fully anticipates it happening, but it will be very complicated to develop and impose. Countries will respond in different ways and become more independent. The United States will have to reindustrialize, since it will not be able to rely on foreign manufacture. We increased productivity by having oil help labor. Now this must reverse.

He did not see the problem being deflation, but rather in the control of inflation. But then it is easier to write a history book than a forecast. He could only see that many people will get hurt in the coming years.

[mheslep]

Ahh, the magic of science, unchecked by the laws of thermodynamics.

All sorts of things are chemically possible. The debate here is about what is economically practical.I suspect you intended to highlight the point that energy is required to produce chemical fuels (and/or to extract them), but nothing CACI said violated the laws of thermodynamics.

[mheslep]

Shale oil and tar sands, or even sythesizing oil, are not economically viable now, Tar sands certainly are viable now with $80/bbl oil, as the Canadians demonstrate daily. Wiki cites $28/bbl production costs (not including diffuse environmental externalities).
http://en.wikipedia.org/wiki/Oil_sands#Canada

[mheslep]

Here are some remarks on this issue from the current ASPO-USA meeting....

http://www.theoildrum.com/node/7035Remarks by who? (Dave Summers. Who?). And I don't mean the speaker who Summers(?) remarks upon. I see the speakers included Bianca Jagger?

[CAC1001]

Looking at individual response, we should all expect to be impacted, and because of the lack of political ability to resolve the issue (or even to address it yet) we should expect that the result will be very similar to the oil shortages of the 70s. There was a degree of panic – this will happen again. This time, however, there will be no North Sea or North Slope to come to the rescue. Nor can the oil taps be opened wider to remediate the problems.

:confused: Is he aware of the shale oil? Tar sands? Natural gas? (we can make fuels from that and from my understanding, we have a ton of it). We also have a tremendous supply of coal, and if required, can turn coal into oil (while the political support isn't there for big domestic mining of coal right now, if things got really bad, I think public concern would override anything the environmentalists would say). We also have oil off the coastlines as well that we do not drill for at the moment.

In questions he was asked about rationing. He fully anticipates it happening, but it will be very complicated to develop and impose. Countries will respond in different ways and become more independent. The United States will have to reindustrialize, since it will not be able to rely on foreign manufacture. We increased productivity by having oil help labor. Now this must reverse.

The United States never deindustrialized. We manufacture more than any other nation on the planet. Not too long ago, our manufacturing sector alone was larger than China's entire economy.

[apeiron]

I suspect you intended to highlight the point that energy is required to produce chemical fuels (and/or to extract them), but nothing CACI said violated the laws of thermodynamics.

The point many people fail to get is that the world we are accustomed to has been built on cheap energy. So discussion of alternatives is meaningless unless the full EROEI equation is considered.

[apeiron]

Remarks by who? (Dave Summers. Who?). And I don't mean the speaker who Summers(?) remarks upon. I see the speakers included Bianca Jagger?

How can you be confused? All the speakers are named in the snippet.

[apeiron]

:confused: Is he aware of the shale oil? Tar sands? Natural gas? (we can make fuels from that and from my understanding, we have a ton of it). We also have a tremendous supply of coal, and if required, can turn coal into oil (while the political support isn't there for big domestic mining of coal right now, if things got really bad, I think public concern would override anything the environmentalists would say). We also have oil off the coastlines as well that we do not drill for at the moment.


If you refer back to the OP you will see that people are well-aware of such things. But even those who believe that such resources can be practically exploited are worried that they cannot be brought online in time to avoid real economic and social disruption.


The United States never deindustrialized. We manufacture more than any other nation on the planet. Not too long ago, our manufacturing sector alone was larger than China's entire economy.

True. But that is a minor point in this context. Or rather, reindustrialisation would be "good news" for those who hope for business as usual because it would mean that the economic disruption was proving pretty minor. Peak oilers would instead see "relocalisation" as the coming business model - if we are lucky.

[mheslep]

How can you be confused? All the speakers are named in the snippet.The question is about the source. There's no quote or transcript of Hirsch's remarks provided here, just an effectively anonymous interpretation from someone who claimed to be there.

[apeiron]

The question is about the source. There's no quote or transcript of Hirsch's remarks provided here, just an effectively anonymous interpretation from someone who claimed to be there.

It was written by David Summers, Curators Professor of Mining Engineering and Director
Rock Mechanics and Explosives Research Center, Missouri University of Science and Technology, who chaired the coal session.

It is unlikely he is wildly misrepresenting anything that was said :smile:.

I can't see how you can maintain that the report is "effectively anonymous", etc. But I suppose it deflects attention away from the actual content of what was (allegedly :zzz:) said.

[mheslep]

It was written by David Summers, Curators Professor of Mining Engineering and Director
Rock Mechanics and Explosives Research Center, Missouri University of Science and Technology, who chaired the coal session.

It is unlikely he is wildly misrepresenting anything that was said :smile:.I agree it is unlikely (now that you've identified him), but credentials are not the final word (http://wtc7.net/articles/stevenjones_b7.html) on these matters. See, e.g.:
I present evidence for the controlled-demolition hypothesis [of the World Trade Center on 911], which is suggested by the available data, and can be tested scientifically, and yet has not been analyzed in any of the reports funded by the US government.Dr Steve Jones, Professor of Physics, BYU, speciallizing in Muon-catalyzed fusion, metal-catalyzed fusion, archaeometry, solar energy. (since placed on leave by BYU).
I can't see how you can maintain that the report is "effectively anonymous", etc.
Because you didn't reference the author originally and the article doesn't contain any byline or signature (at least not in plain view)!

You are apparently operating under the principle that the burden is on the reader to both identify the source and discover whether or not it is independent and reliable, instead of on the poster. This is contrary to the guidelines, and tedious, as we've been through this before (http://www.physicsforums.com/showpost.php?p=2810729&postcount=22).

[apeiron]

You are apparently operating under the principle that the burden is on the reader to both identify the source and discover whether or not it is independent and reliable, instead of on the poster. This is contrary to the guidelines, and tedious, as we've been through this before (http://www.physicsforums.com/showpost.php?p=2810729&postcount=22).

Don't be ridiculous. You just didn't look very hard. You are trying to make something out of nothing because fussing about who said these things excuses you from having to deal with what they said.

[mheslep]

Some elbowing of the 'peak' further out in time:
http://www.ft.com/cms/s/0/dd1e9400-7ef1-11df-8398-00144feabdc0.html
Oil and natural gas markets are set to remain oversupplied until 2015, the International Energy Agency said on Wednesday, forecasting in its annual medium-term outlook report “comfortable spare capacity” for both energy commodities.
and
“For the next few years, the oil market is marked by more comfortable spare capacity than envisaged last year, and the duration of the current gas glut is set to last beyond 2013, at least in some regions.”

[mheslep]

Another commodities bet ala the Simon - Erlich wager (http://en.wikipedia.org/wiki/Simon%E2%80%93Ehrlich_wager) comes due, this time on the price of oil. The wager was between NYT libertarian-leaning columnist John Tierney (http://en.wikipedia.org/wiki/John_Tierney_(journalist)) and (recently deceased) energy banker and peak oiler Matthew Simmons. (http://dealbook.nytimes.com/2010/08/09/matthew-simmons-noted-energy-banker-dies-at-67/) The wager, made in 2005 for US$5000, was that the price of oil would triple by Jan 1, 2011. Mr Simmons' estate paid Mr Tierney his due.
http://www.nytimes.com/2010/12/28/science/28tierney.html

One would think reality would dry up the pool of those willing to bet liberally on calamity against human resourcefulness, or at least have them asking for better odds, but the Malthusian (http://en.wikipedia.org/wiki/Malthusian_catastrophe#Traditional_Malthusian_theo ry) gene appears stubborn. So count me in the Tierney camp, looking for similar wagers.

[mugaliens]

Oversupply? Gas glut?

If that's the case, why are gas prices are nearly 300% higher than they were a decade ago, particularly when inflation over that time has only been 31%, cumulative?

[Phrak]

Oversupply? Gas glut?

If that's the case, why are gas prices are nearly 300% higher than they were a decade ago, particularly when inflation over that time has only been 31%, cumulative?

What's your source?

[nismaratwork]

Another commodities bet ala the Simon - Erlich wager (http://en.wikipedia.org/wiki/Simon%E2%80%93Ehrlich_wager) comes due, this time on the price of oil. The wager was between NYT libertarian-leaning columnist John Tierney (http://en.wikipedia.org/wiki/John_Tierney_(journalist)) and (recently deceased) energy banker and peak oiler Matthew Simmons. (http://dealbook.nytimes.com/2010/08/09/matthew-simmons-noted-energy-banker-dies-at-67/) The wager, made in 2005 for US$5000, was that the price of oil would triple by Jan 1, 2011. Mr Simmons' estate paid Mr Tierney his due.
http://www.nytimes.com/2010/12/28/science/28tierney.html

One would think reality would dry up the pool of those willing to bet liberally on calamity against human resourcefulness, or at least have them asking for better odds, but the Malthusian (http://en.wikipedia.org/wiki/Malthusian_catastrophe#Traditional_Malthusian_theo ry) gene appears stubborn. So count me in the Tierney camp, looking for similar wagers.

I'm not sure that it's fair to call the eventual expiration of a limited reserve of fossil fuel, "Malthusian". I would say that's just reality, and how you interpret the potential fallout could be construed as Malthusian. Oil is a wasting asset by its very definition, and even if the USA, Western Europe, and some others manage with other power sources, we can see how oil plays a roll in the growth of China, India, and other nations which are becoming ever more industrialized.

Human resourcefulness is great, but you're asking for people to put their FAITH in their fellow man?! :rofl: Yeah, I have faith in both the great pumpkin, and that people will suddenly begin to solve more and bigger problems than they create.

Or in the words of Dana Gould, "Maybe the government should figure out how I can get on an airplane with my F*****G eyedrops before I set them loose on global warming!"

Well, I'll wait until I see world governments doing something other than their current and historical behaviour, 'Senators, Rome is overcrowded and too many dwellings are of wooden construction.' RESULT: Rome burns, politicians rebuild. You underestimate the human ability to ignore a problem until its upon us (we do it with our own mortality every days soooo...) and then rebuild. How do you, 'rebuild' a shattered portable energy economy? It's not as though we can go back to unicorn piss gasoline... or can we? Human resourcefulness... build me a gas-pissing unicorn!

[mheslep]

I'm not sure that it's fair to call the eventual expiration of a limited reserve of fossil fuel, "Malthusian". ...Tierney did not. Nor did I.

[mheslep]

...
If that's the case, why are gas prices are nearly 300% higher than they were a decade ago, particularly when inflation over that time has only been 31%, cumulative?Really? Care to make a wager on that? :biggrin:

~50-60% increase in real terms over 2000. Same price today in real terms as ~1983
http://www.randomuseless.info/gasprice/gasprice.html

[nismaratwork]

Tierney did not. Nor did I.

What is then?

[mheslep]

What is then?When the prediction includes something calamitous, like that failed forecast of a tripling of oil prices in only five years, or per Websters, an unavoidable "widespread poverty and degradation."

[russ_watters]

One would think reality would dry up the pool of those willing to bet liberally on calamity against human resourcefulness, or at least have them asking for better odds, but the Malthusian (http://en.wikipedia.org/wiki/Malthusian_catastrophe#Traditional_Malthusian_theo ry) gene appears stubborn. So count me in the Tierney camp, looking for similar wagers. Like playing 777 in the lottery every day or betting on an impending recession 5 years into an expansion period, this is a wager that seems like they must eventually win - not that I'd ever let them forget the years (decades!) of losses to focus on the win if it happens...

...but there are hints that for the US at least, the basic prediction of Peak Oil will never happen but instead may be rendered moot by technology and legislation, with the recession making for a sharp peak. Essentially, recent data suggests that due to that combination, we passed our peak in 2006 and may be starting a long-term and permanent decline, burning 20% less by 2030. And this is starting without a dramatic rise in gas prices.
http://www.boston.com/yourtown/cambridge/articles/2010/12/20/us_gas_demand_should_fall_for_good_after_06_peak/

[mheslep]

Like playing 777 in the lottery every day or betting on an impending recession 5 years into an expansion period, this is a wager that seems like they must eventually win - not that I'd ever let them forget the years (decades!) of losses to focus on the win if it happens...Absent the abolision of price signals, I seriously doubt the Peakers win ever such bets. All that has to happen is that other transportation energy sources - biofuel, hydrogen, solar/nuclear/whatever/ powered electrics - become as capable and cheaper per mile than petroleum, then the planet never depletes its reserves of oil. In such a case people would leave the (increasingly worthless) stuff in the ground.

...but there are hints that for the US at least, the basic prediction of Peak Oil will never happen but instead may be rendered moot by technology and legislation, with the recession making for a sharp peak. Essentially, recent data suggests that due to that combination, we passed our peak in 2006 and may be starting a long-term and permanent decline, burning 20% less by 2030. And this is starting without a dramatic rise in gas prices.
http://www.boston.com/yourtown/cambridge/articles/2010/12/20/us_gas_demand_should_fall_for_good_after_06_peak/
Thanks for that link.

"People wildly underestimate the effect that all this is going to have" on gasoline demand, says Paul Sankey, an analyst at Deutsche Bank. Sankey predicts by 2030 America will use just 5.4 million barrels a day, the same as in 1969.:rolleyes:

[mugaliens]

What's your source?

Source for historical gas prices (http://www.eia.doe.gov/petroleum/data_publications/wrgp/mogas_history.html).

Source for inflation (http://data.bls.gov/cgi-bin/cpicalc.pl).

Do you not concur with data as published by the U.S. Department of Energy or the U.S. Bureau of Labor and Statistics?

[russ_watters]

Source for historical gas prices (http://www.eia.doe.gov/petroleum/data_publications/wrgp/mogas_history.html).

Source for inflation (http://data.bls.gov/cgi-bin/cpicalc.pl).

Do you not concur with data as published by the U.S. Department of Energy or the U.S. Bureau of Labor and Statistics? There is a lot of data in a lot of different tables there. Please be more specific about where you got your numbers. What exact dates and prices did you use?

[mheslep]

Source for historical gas prices (http://www.eia.doe.gov/petroleum/data_publications/wrgp/mogas_history.html).

Source for inflation (http://data.bls.gov/cgi-bin/cpicalc.pl).

Do you not concur with data as published by the U.S. Department of Energy or the U.S. Bureau of Labor and Statistics?

And?

US gasoline avg price, regular, retail conventional:
Jan 01, 2001 1.377 (1.75 in 2011 dollars)
Jan 03, 2011 3.034

or a 73% increase over 10 years ago. US premium is similarly up 66%.

[CAC1001]

Absent the abolision of price signals, I seriously doubt the Peakers win ever such bets. All that has to happen is that other transportation energy sources - biofuel, hydrogen, solar/nuclear/whatever/ powered electrics - become as capable and cheaper per mile than petroleum, then the planet never depletes its reserves of oil. In such a case people would leave the (increasingly worthless) stuff in the ground.

One thing on this though, energy isn't so much what concerns me as usage of petroleum for materials. I mean everything from tires to plastics to laundry detergent, you need petroleum to make. Even if we could power our cities all on solar power, we still need petroleum for making things, right?

[nismaratwork]

There is a lot of data in a lot of different tables there. Please be more specific about where you got your numbers. What exact dates and prices did you use?

Seriously? I understand the need to present a concise citation, but I found that pretty easy to read through, and the calculator was... a calculator. Surely you have more to offer on the subject than this.

[nismaratwork]

One thing on this though, energy isn't so much what concerns me as usage of petroleum for materials. I mean everything from tires to plastics to laundry detergent, you need petroleum to make. Even if we could power our cities all on solar power, we still need petroleum for making things, right?

Well, there is some successful research into using corn byproducts as a substitute. It's hardly a solution, but then, it may be that the supply of petroleum byproducts carries us through until other options are perfected. Others here doubtless are better informed about this issue.

[apeiron]

The malthusian vs the cornucopian mindset is worthy of a more technical discussion here.

Is there any evidence or model that says human ingenuity must run ahead of the game here?

Past civilisations have collapsed because of resource limits. But this time round might be different because we have fully liberated human ingenuity with laisser-faire economics?

Personally I think we are running too many exponential curves at once - consumption of cheap fossil fuels, population growth, water degradation, ecological services run-down, climate change - to not hit the buffers.

For Malthusians, the modelling seems easy in this regard. But what is model for cornucopian analysis?

I guess it could be a Moore's law approach as spun by Kurzweil and the Singularity crew for example. But further thoughts anyone?

Economists always say market signals lead to substitution. Which is fair enough as far as it goes. But is there a model that says ingenuity runs ahead of our problems in some more formal sense?

[mheslep]

One thing on this though, energy isn't so much what concerns me as usage of petroleum for materials. I mean everything from tires to plastics to laundry detergent, you need petroleum to make. Even if we could power our cities all on solar power, we still need petroleum for making things, right?I see it the other way around, only the energy content is of concern in the long term. Yes hydrocarbon polymers are made from petroleum, apparently at the rate of of some two million tons per year (http://books.google.com/books?id=84b_MoTo4noC&pg=PA39&lpg=PA39&dq=polymer+production+world+annual+OR+year&source=bl&ots=lIDNAvlfXL&sig=sjoo7w6J6CSz4NUlsEAWdvGeFvU&hl=en&ei=5SglTdaWK8OC8gb24dyJAg&sa=X&oi=book_result&ct=result&resnum=3&ved=0CCUQ6AEwAg#v=onepage&q=polymer%20production%20world%20annual%20OR%20yea r&f=false). But they can be recycled or eventually synthesized from some other carbon and hydrogen source given the required energy. That is, the hydrogen and carbon mass is not leaving the planet. The useful energy (i.e. low entropy) from petroleum (or any other source), once spent, is gone forever.

[mheslep]

This is an elegant, open minded introduction to further discussion, though as you might guess I disagree with some of the assumptions and view point.
The malthusian vs the cornucopian mindset is worthy of a more technical discussion here.

Is there any evidence or model that says human ingenuity must run ahead of the game here?Have you read the new Ridley (http://www.nytimes.com/2010/06/13/books/review/Easterly-t.html) yet? (http://tv.nationalreview.com/uncommonknowledge/post/?q=MTkxODQ0ODJkNGY3YWNiODJmMWM5NmRmZGViNzZhMWM=) I'm about to. He amusingly calls the model "ideas having sex", I gather something about humans being the only species capable of exchange, and once ancient despotism got out of the way of free exchange, displaced haltingly at first, but with time overwhelmingly by classically liberal values and respect for the worth of the individual, prosperity exploded.

I would call the evidence that it does, not that it must, ample, such as the history of switching over global fuel sources every ~hundred years for the last three hundred (http://1366tech.com/v1/mambots/content/multithumb/thumbs/b.0.200.0.0.stories.site.graph_fuels.jpg) without depleting any of them. I gather Ridley's Rationale Optimist provides an onslaught of similar evidence.

Past civilisations have collapsed because of resource limits.Because? Yes some collapsed, yes there is a respected theory (http://en.wikipedia.org/wiki/Classic_Maya_collapse#Systemic_ecological_collapse _model), one of many, that these limits caused the collapse, for instance in the case of the Mayans. Even so, I don't know that this means resource consumption was the fundamental cause, as opposed to something else like cultural and government corruption that led to wanton destruction of environmental resources, and that then these conditions in turn provoked a collapse.

That is, allow me to conjure up a modern liberalized nation, suddenly taken over by a reincarnated Mayan King, who immediately ordered all the markets replaced with temples of sacrifice dedicated to him, and who's only standing order was to cut down trees to keep the sacrificial fires burning 24/7. Such a society might quickly hit resource limits, despite every blessing of existing modern technology, but in such a case I would not cite resource consumption as the cause of the collapse.

I guess it could be a Moore's law approach as spun by Kurzweil and the Singularity crew for example. As spun by Moore, and yes that's more good evidence.

[russ_watters]

Seriously? I understand the need to present a concise citation, but I found that pretty easy to read through, and the calculator was... a calculator. I figured out exactly what data came from the calculator. I have an idea of where the data came from for the other claim and it appears to me to be at best sloppy and at worst cherry-picked for the purpose of deception. Are you saying you know exactly what data came from the other link and what the resulting calculation was? Seriously? Do share with the rest of the class. We have two vastly different claims and need to reconcile how they can be so different.

[russ_watters]

Is there any evidence or model that says human ingenuity must run ahead of the game here?

Past civilisations have collapsed because of resource limits. But this time round might be different because we have fully liberated human ingenuity with laisser-faire economics?
I'd say the evidence is in the fact that society hasn't stagnated or that new societies haven't collapsed for the same reason old ones have. I'd also say that the burden of proof shoe is on the other foot: clearly not all civilizations that collapsed did so because of resource depletion, but the peak oil claim is that society must eventually collapse because of peak oil. Has no society ever adapted to a depletion of resources?

[apeiron]

Have you read the new Ridley (http://www.nytimes.com/2010/06/13/books/review/Easterly-t.html) yet? (http://tv.nationalreview.com/uncommonknowledge/post/?q=MTkxODQ0ODJkNGY3YWNiODJmMWM5NmRmZGViNzZhMWM=) I'm about to.

Haven't read the book (and the unkind would point out that Ridley was a chairman of Northern Rock among other things - a UK poster child for unsustainable growth models in finance) but the basic idea is clear enough.

Yes, broadly speaking, evolutionary theory would seem the natural way to model our adaptive capacity here. And we have a lot of reason to believe in our power to adapt.

But an immediate question presents itself. Is evolution is a theory about progressive advance or the maximising of entropification?

The cornucopian paradigm would seem wedded to a belief that it is all about human progress - things will keep getting better in some overall or global sense.

This could mean everyone is gets happier, or healthier, or GPD per capita rises forever, or human population keeps growing, or human social complexity keeps increasing. But to be a model, the cornucopian view would have to be able to spell out its measure of success.

And if this could be argued to be a natural goal, then we could argue that evolutionary theory is the model that predicts we will adapt and keep on moving towards this goal.

However most modern theoretical biologists (the ones I know, like Stan Salthe for instance http://www.mdpi.com/1099-4300/9/2/83/pdf) argue instead that evolution is about the acceleration of entropification. The natural goal is to dissipate gradients as fast as possible. And so this being the case, the "genius" of Homo sapiens will be directed towards exactly this goal. Our adaptive capacity is in fact being used to deplete the world of its natural resources.

So if left just to the natural forces of evolution, we would predict that human culture would evolve to "progressively" towards achieving that goal. And this of course appears to fit the facts. We are driven to be wasteful consumers of the otherwise locked away energy of fossil fuels.

Thus while I agree that evolutionary theory is a way to account for adaptive capacity, the same mechanism could have two quite different goals - some handwavey and pious notion of human ascension vs obedience to the second law of thermodynamics. And thus quite different views of the likely outcome.

So the cornucopian view seems to have to not only explain an adaptive capacity sufficient to stay a step ahead of resource depletion, but how that adaptive capacity is going to be used for anything other than the purpose of achieving resource depletion.

Of course, at this point people will begin appealing to things such as the "survival instinct". Or human foresight and choice. But again, let's hear something about the model that supports a belief in such things.

If I was continuing the cornucopian argument, I would now talk about anticipatory systems. I would be looking at the kind of societies that could indeed look ahead, agree "unnatural" goals like turning down the burn rate, and avoiding hitting the buffers.

My model of such a society would look rather different from the laisser-faire economies that Micawaber-like, say keep charging ahead blindly in the safe expecation that something will always turn up to rescue the day.

But that is not the kind of model that Ridley and his like are pushing, is it? So what kind of economic/social model can be shown to have 1) rich adaptive capacity, 2) a defined metric of success, and 3) sufficient anticipatory capacity to make choices far enough ahead of time with some certainty.

Laisser-faire economics would seem to offer only 1. On 2, the metric is usually GDP growth (a measure of entropification really) and perhaps a few quality of life stats like average life expectancy. On 3, there is a faith in market signals. Which is something - though you need a market (and do we have markets for goods like ecological services yet)? And you need honest markets (the credit crunch exposed that little issue bigtime - a shadow banking system orders of magnitude larger than the official one).

Another datapoint to throw into the mix is the question of whether we really are seeing rising rates of human innovation. There is the well-know criticisms of Jonathan Huebner for instance - http://en.wikipedia.org/wiki/Jonathan_Huebner

But to restate the question, a malthusian view of resource depletion seems easy to model. If a resource is finite and its exploitation exponential, the exploiting system can be predicted to hit a sudden wall. Even if the system has proven itself highly innovative in its past, there is no reason to expect it to have the kind of innovative capacity to handle the scale of disruption it must eventually strike.

The model supporting a cornucopian view is not clear to me at all. The best I can think of is that the system at question has been through enough disruptions in the past and has proved it has built up a general disruption handling capacity. But I would expect such a system to have recognisable methods for looking ahead so as to prepare for disruptions in timely fashion. And not to show a boom and bust bubble mentality when it comes to economics.

If we had a cornucopian model like this, we would be able to plug in the performance of countries and see how well designed they really are. We could say with some confidence that society is doing the right things. But I've talked to plenty of cornucopian economists who have said in a hand wavey fashion, humans are remarkably adaptive. However none so far who have been able to back this up with a formal model.

Another term for this is of course resilience. And there is a literature on that in relation to the disruptions of natural disasters. Peak oilers spend a lot of their time talking about building resilience and social capital too. But I guess that is back to the malthusian perspective.

I'm tossing around a lot of ideas here. But it is because I have not come across a robust reason to believe the cornucopian pitch. If there is a model out there, it would be great to be able to kick its tyres.

[apeiron]

I'd say the evidence is in the fact that society hasn't stagnated or that new societies haven't collapsed for the same reason old ones have. I'd also say that the burden of proof shoe is on the other foot: clearly not all civilizations that collapsed did so because of resource depletion, but the peak oil claim is that society must eventually collapse because of peak oil. Has no society ever adapted to a depletion of resources?

Are you so sure? Jared Diamond would be one who argues that carrying capacity is the most general factor in the collapse of societies.

http://en.wikipedia.org/wiki/Collapse:_How_Societies_Choose_to_Fail_or_Succeed

And the peak oilers optimistic scenario is a bumpy energy descent where we turn away from consumerism and relocalise. So this would be adaptation and an appealing vision to some.

[nismaratwork]

I figured out exactly what data came from the calculator. I have an idea of where the data came from for the other claim and it appears to me to be at best sloppy and at worst cherry-picked for the purpose of deception. Are you saying you know exactly what data came from the other link and what the resulting calculation was? Seriously? Do share with the rest of the class. We have two vastly different claims and need to reconcile how they can be so different.

So you didn't need more info, you have a problem with the info? That makes sense, but why not just say that in the first place?

[nismaratwork]

Are you so sure? Jared Diamond would be one who argues that carrying capacity is the most general factor in the collapse of societies.

http://en.wikipedia.org/wiki/Collapse:_How_Societies_Choose_to_Fail_or_Succeed

And the peak oilers optimistic scenario is a bumpy energy descent where we turn away from consumerism and relocalise. So this would be adaptation and an appealing vision to some.

In fact, boom or bust, we're bound to adapt, but adaptation may not be the most pleasant experience for the people living through it.

[mheslep]

Haven't read the book (and the unkind would point out that Ridley was a chairman of Northern Rock among other things - a UK poster child for unsustainable growth models in finance) but the basic idea is clear enough.And has doctorate in Zoology from Oxford. More later, maybe after I've read him.

[nismaratwork]

And has doctorate in Zoology from Oxford. More later, maybe after I've read him.

Maybe he wants to return the planet to non-human animals. :wink:


OR...

Maybe he's a bunch of wild animals in a PERSON MASK! TA TA TUM!

[PhilKravitz]

As many as we're willing to pay for of course.

So far we have been willing to pay for an insignificant number. Do we expect this to change? I do not.

[apeiron]

Republican congressman, he say....


What America Needs
�� The total commitment of WWII
�� The technology intensity and focus of the Apollo Program to land a man on the moon$275 billion in 2006 dollars
�� The urgency of the Manhattan Project to develop the atom bomb $1.1 trillion in 2006 dollars
�� Mitigate Peak Oil $3-4 trillion over 20 years BEFORE peak in 2006 dollars

http://bartlett.house.gov/UploadedFiles/Energy%20Bartlett%20Special%20Order%20Charts%20Feb %2028%202008.pdf

The presentation is a couple of years old, but has good graphs.

The cornucopian view is that fuel substitution will happen in response to market signals. But the problem is that oil is not yet being priced in a way to send signals.

Because energy consumption is the economy, price rises puncture the economy and so collapse the price. If you want markets to deliver, they have to have the right feedback loops built into them.

Anyway, politicians are now worried. Even the IEA has changed its tune. The EIA is becoming the last optimist in the room.

A good summary of how the tune has been changing....

http://resourceinsights.blogspot.com/2011/01/you-dont-have-to-take-my-word-for-it.html

[mheslep]

The cornucopian view is that fuel substitution will happen in response to market signals. But the problem is that oil is not yet being priced in a way to send signals.

Because energy consumption is the economy, price rises puncture the economy and so collapse the price. Seems to be priced sufficiently to make, for example, these alternatives economically viable: tar sand oil in Canada, some biofuels, PHEVs/EVs, more fuel efficient ICE vehicles.

Edit: the price signals might be a little more realistic without the $3-400 billion annual oil subsidies ($500 billion all fossil energy)
http://www.ft.com/cms/s/0/27c0ff92-7192-11df-8eec-00144feabdc0.html#axzz1BGJ6ZsCl

[nismaratwork]

Seems to be priced sufficiently to make, for example, these alternatives economically viable: tar sand oil in Canada, some biofuels, PHEVs/EVs, more fuel efficient ICE vehicles.

I agree, but if you argue that those are a decade or so overdue (the middle, less so), then we're still behind the 8 ball on this. That just sends the debate back to "Go" however, and this is NOT my area of... you know I was going to say expertise, but I'll say "competence" and just be honest.

[apeiron]

I agree, but if you argue that those are a decade or so overdue (the middle, less so), then we're still behind the 8 ball on this. That just sends the debate back to "Go" however, and this is NOT my area of... you know I was going to say expertise, but I'll say "competence" and just be honest.

This is the crux. Are things being left too late because a) political leadership does not get it/feels paralysed, or are we b) needlessly worrying because those in charge have already worked out all the angles and can see a path through?

I know what I believe from a lifetime seeing political decision making at close quarters (option a of course!).

But hopefully mheslep will return as promised with a cornucopian model of the situation that is convincing. I would like not to have to worry about peak cheap energy and only worry about global warming and global over-population o:).

[nismaratwork]

This is the crux. Are things being left too late because a) political leadership does not get it/feels paralysed, or are we b) needlessly worrying because those in charge have already worked out all the angles and can see a path through?

I know what I believe from a lifetime seeing political decision making at close quarters (option a of course!).

But hopefully mheslep will return as promised with a cornucopian model of the situation that is convincing. I would like not to have to worry about peak cheap energy and only worry about global warming and global over-population o:).

Oh yeah, I don't think anyone is going to be sad if the cornucopian model is TRUE. I'd like to live in an ice-cream castle in heaven when I die too; I'm not placing my bets on it. :wink:

[PhilKravitz]

This is the crux. Are things being left too late because a) political leadership does not get it/feels paralysed, or are we b) needlessly worrying because those in charge have already worked out all the angles and can see a path through?



I think there are more cases.

1) leadership does not get it
2) leadership already has it figured out
3) leadership knows it is an issue and sees no solution
4) leadership knows it is an issue and sees no easy solution

My guess is #4. About three years ago Lawrence Livermore National Labs (US) was advertising for an economist to study the total life cycle cost of all future energy generation systems. I would love to know the results of that study.

[CAC1001]

You know, we could probably significantly reduce fuel consumption (and hence petroleum) and also shave trillions out of healthcare expenditures, if Americans would lose some weight!

[nismaratwork]

You know, we could probably significantly reduce fuel consumption (and hence petroleum) and also shave trillions out of healthcare expenditures, if Americans would lose some weight!

Yeah, that's what will change the course of fossil fuel history... :tongue:

[apeiron]

Some more modelling that perhaps gets under the skin of the peak oiler vs cornucopian debate.

http://www.energybulletin.net/stories/2011-01-17/no-peak-oil-yet-limits-hubbert-model

This study contrasts the story for US oil production and US gas production. The one is peaked as Hubbert's curve predicted, the other still seems to be responding to cornucopian hopes - as prices rise, this stimulates innovation (such as fracking) that increases supply.

But....

[mheslep]

Recent comment from an energy analyst at Deutsche Bank: (http://usnews.rankingsandreviews.com/cars-trucks/daily-news/101221-US-Demand-for-Gasoline-Dropping/)

America's demand for gasoline has declined four years in a row and will not reach the 2006 level again, even when the economy fully recovers,” USA Today says.
furthermore
’'People wildly underestimate the effect that all this* is going to have on gasoline demand,’” says Paul Sankey, an analyst at Deutsche Bank who spoke with the AP. Sankey says that “by 2030 America will use just 5.4 million barrels a day, the same as in 1969.
He's referring there only to US motor gasoline consumption (not all petroleum derivatives) which has been hovering under 9 million barrels a day for a while now.
http://tonto.eia.doe.gov/dnav/pet/hist_chart/MGFUPUS2a.jpg

*'this' being:
o ICE cars and trucks becoming more fuel efficient
o blending of ethanol
o people driving less
o higher prices
o advent of hybrids and EVs
o waning popularity of SUVs

[nismaratwork]

Recent comment from an energy analyst at Deutsche Bank: (http://usnews.rankingsandreviews.com/cars-trucks/daily-news/101221-US-Demand-for-Gasoline-Dropping/)


furthermore

He's referring there only to US motor gasoline consumption (not all petroleum derivatives) which has been hovering under 9 million barrels a day for a while now.
http://tonto.eia.doe.gov/dnav/pet/hist_chart/MGFUPUS2a.jpg

*'this' being:
o ICE cars and trucks becoming more fuel efficient
o blending of ethanol
o people driving less
o higher prices
o advent of hybrids and EVs
o waning popularity of SUVs

Is there any indication that the petroleum market isn't finding an amenable customer in China? GM seems to think it's a good place to sell cars, and I think it's the definition of a growing market. Is there some indication that China won't pick up the slack, and then some?

[mheslep]

Is there any indication that the petroleum market isn't finding an amenable customer in China? GM seems to think it's a good place to sell cars, and I think it's the definition of a growing market. Is there some indication that China won't pick up the slack, and then some?There's some. Chinese bought 21 million electric bikes/scooters last year with 100 million total on the road.
http://www.time.com/time/world/article/0,8599,1904334,00.html

[nismaratwork]

There's some. Chinese bought 21 million electric bikes/scooters last year with 100 million total on the road.
http://www.time.com/time/world/article/0,8599,1904334,00.html

Yes, and they don't exactly have to gentrify much of the population to exert astounding purchasing power. Given that corporations have only very loose national ties in many cases, and are naturally addicted to money... do the math. China is the cocaine dealer of choice for junkies, if you substitute, "money" for cocaine, and "the US" for junkies.

[Greg Bernhardt]

One thing on this though, energy isn't so much what concerns me as usage of petroleum for materials. I mean everything from tires to plastics to laundry detergent, you need petroleum to make. Even if we could power our cities all on solar power, we still need petroleum for making things, right?

This is the case that this movie makes. Has anyone seen it? The guy talks about the countless petroleum products that can't be easily made with other materials. Most cars are full of plastic. Who cares if you can't afford to drive your car if can't afford to buy one any longer. mheslep thinks we can recycle enough, but I highly doubt we can recycle enough to meet future demand.

http://www.collapsemovie.com/

[mheslep]

This is the case that this movie makes. Has anyone seen it? The guy talks about the countless petroleum products that can't be easily made with other materials. Most cars are full of plastic. Who cares if you can't afford to drive your car if can't afford to buy one any longer. mheslep thinks we can recycle enough, but I highly doubt we can recycle enough to meet future demand.
Apparently petrochemical feedstock is about 2% of total US petroleum consumption (http://tonto.eia.doe.gov/dnav/pet/pet_cons_psup_dc_nus_mbblpd_a.htm). If that were the only use for petroleum it must be several centuries before the fossil reserves were used up, and then there is bio-oil made renew-ably from algae or soy or whatever to supply future demand. By the way petrochemical usage in the US has reduced by some 40% (http://tonto.eia.doe.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MPCUP_NUS_2&f=A) since 2004; I can only speculate as to why. In any case plastics are all carbon, hydrogen, oxygen, and nitrogen. Maybe some of our chemists can address synthesis from the basics, but I can't imagine it is all that difficult given sufficient energy. Maybe the movie will show otherwise (thanks).

[Greg Bernhardt]

but I can't imagine it is all that difficult given sufficient energy. Maybe the movie will show otherwise (thanks).

I fully accept you know vastly more about the subject than me. However is there a key in what you just said there? "given sufficient energy". Where are we going to get that energy? :)

[mheslep]

I fully accept you know vastly more about the subject than me. However is there a key in what you just said there? "given sufficient energy". Where are we going to get that energy? :)Well right, that was my point with CAC above (http://www.physicsforums.com/showpost.php?p=3067871&postcount=198) to which you've circled back around, that energy should be the focus and not material, at least not that which is made simply(?) from the abundant elements. As for some possible answers to your question here maybe see #41 (http://www.physicsforums.com/showpost.php?p=2811968&postcount=41), or some of the other couple hundred posts in this thread. :wink:

[PhilKravitz]

The issue for the US that imports so much energy is net export oil. There is a fine talk about this issue at
http://mediasiteson.sandia.gov/Mediasite/SilverlightPlayer/Default.aspx?peid=db3a600e-e93f-43ae-80d8-0f1cfbb328fe
It makes the case that the top five exports will have zero oil available for export in about 2031. That is not to say they have zero production. It is to say that they increase their domestic use and are at this point using all their production for themselves. So the next 20 years will be interesting.

[mheslep]

The issue for the US that imports so much energy is net export oil. There is a fine talk about this issue at
http://mediasiteson.sandia.gov/Mediasite/SilverlightPlayer/Default.aspx?peid=db3a600e-e93f-43ae-80d8-0f1cfbb328fe
It makes the case that the top five exports will have zero oil available for export in about 2031. That is not to say they have zero production. It is to say that they increase their domestic use and are at this point using all their production for themselves. So the next 20 years will be interesting.That comes about from the assumption that the Saudi's will continue to not develop their largely untouched remaining oil reserves, and continue instead to hold production at current rates, while at the same time extrapolating a Saudi domestic increase in oil consumption at ~6% per year out through the 2030's, a trend counter to what is seen now in the developed world. I don't think either one of those assumptions are warranted.

[PhilKravitz]

That comes about from the assumption that the Saudi's will continue to not develop their largely untouched remaining oil reserves,

No. Their assumption is that Saudi does not have large untouched reserves. Just as Matt Simon's made the point in his book "Sunset in the Desert".

[mheslep]

No. Their assumption is that Saudi does not have large untouched reserves. Just as Matt Simon's made the point in his book "Sunset in the Desert".From one the Sandia slides, 21:00

Conventional Wisdom - The Economist Quote About Saudi Arabia

Saudi Aramco's proved reserves alone could keep the world supplied for several decades. But it is only exploiting ten of its 80 or so fields, so will be able to pump at the present rate for about 70 years even if it never discovers another drop of oil

Economist Magazine, August 10, 2006

[nismaratwork]

From one the Sandia slides, 21:00

Aramco?... you mean, the company that becomes defunct if Saudi Oil dries up? I'm not sure if this is evidence of something, or just a prospectus.

[PhilKravitz]

The counter is the Hubbert curve fits to the actual Saudi production data.

Yes it could be that they have secret fields, the same has been said of the US. Time will tell.

[mheslep]

The counter is the Hubbert curve fits to the actual Saudi production data.

Yes it could be that they have secret fields, the same has been said of the US. Time will tell.The point of the Sandia brief, as I quickly went through it, was that the Saudi fields are not unknown nor secret but known and purposely not developed. As quoted above, they are exploiting only 1 in 8 of their known fields. Yes if they keep this up this artificial limitation internal demand make eventually overtake supply.

[nismaratwork]

The point of the Sandia brief, as I quickly went through it, was that the Saudi fields are not unknown nor secret but known and purposely not developed. As quoted above, they are exploiting only 1 in 8 of their known fields. Yes if they keep this up this artificial limitation internal demand make eventually overtake supply.

Unless of course that's just Aramco's fantasy... and really, when is a company going to tell its investors: "Hey guys, the reaper is literally breathing down our necks! Bail now!"?

[apeiron]

The issue for the US that imports so much energy is net export oil. There is a fine talk about this issue at
http://mediasiteson.sandia.gov/Mediasite/SilverlightPlayer/Default.aspx?peid=db3a600e-e93f-43ae-80d8-0f1cfbb328fe
It makes the case that the top five exports will have zero oil available for export in about 2031.

This is indeed a great talk - in a "may as well curl up and die right now" kind of way.

There was one really good policy suggestion in the Q&A. Because energy consumption is GDP, it makes sense to replace payroll tax with an energy consumption tax. So this would create the direct market signal that the situation needs. You can fill up your Hummer, but it is going to cost so much you might have to take the new neighbourhood tramtrain instead. So no taxes except on your fuel use.

And it was a little weird of mheslep to pull out the Economist quote out of the presentation as clearly that was the conventional wisdom the whole presentation debunks.

If Saudi has vast secret reserves, then that does not look reflected in the production curves, as Brown argues in slide 12. All other past and current scenarios fit the data (Brown claims) so Saudi would have to have been quietly carrying out some outlier production policy all this time. Are the Saudis really that politically sophisticated?

Overall, the presentation is very bad news. Top 5 exporters projected to cease exporting by 2031. And fuel price rises will be geometric as a consequence (from $100 a barrel, to $200, then $400, etc). Brown says the rich would bid up the price of remaining exports and so there is an accelerating feedback mechanism as part of the end game.

Of course all sorts of things would be happening at that stage. For instance, top exporters like Russia and Saudi might be having crash efficiency campaigns that would prolong their ability to supply. On the other hand, they would probably also decide to limit export so as to be able to supply their own folk.

[mheslep]

[...]
And it was a little weird of mheslep to pull out the Economist quote out of the presentation as clearly that was the conventional wisdom the whole presentation debunks.Brown's presentation is all about pushing the idea that internal consumption eventually will net out exports to zero. He produces nothing almost nothing new on production, that is to the counter the notion as espoused by the Economist, that the Saudi's are exploiting only "ten of its 80 or so fields."

If Saudi has vast secret reserves, then that does not look reflected in the production curves, as Brown argues in slide 12. All other past and current scenarios fit the data (Brown claims) so Saudi would have to have been quietly carrying out some outlier production policy all this time. Are the Saudis really that politically sophisticated?The current Saudi operation requires no secrecy or Machiavellian planning. They could simply choose a level of production to maintain or to slowly increase world prices.

We have (here) on this subject one respectable reference, that from the Economist on Saudi production, and no references at all to contradict it.

[apeiron]

The point of the Sandia brief, as I quickly went through it, was that the Saudi fields are not unknown nor secret but known and purposely not developed. As quoted above, they are exploiting only 1 in 8 of their known fields.

I'm still scratching my head about this. Saudi reserves are indeed a state secret. People are reduced to using google maps satellite pictures to count oil wells and get some idea of the actual production trends. (http://www.theoildrum.com/tag/ghawar). So the first point is that we are not dealing with "knowns" here, just trying to make sense of a lot of contradictory messages.

Here is as close to an honest answer as I've seen (http://www.energybulletin.net/node/50234 and http://www.energybulletin.net/node/50364) - which is a vote of confidence that Saudi can maintain 10 million barrels a day over a reasonable term, but the IEA goal of pushing Saudi to 15 mbd by 2020 (and that Saudi should already be at 12 mbd) is not do-able. And we have to remember that Saudi is in fact down around 8 mbd, and that during the 2008 price spike it appeared not to be responding to this price signal and so led some to feel it had in fact peaked.

- http://tomweston.net/saudioil.txt
- http://www.bloomberg.com/news/2011-01-05/saudi-arabia-s-2010-oil-production-exceeded-opec-quota-by-4-3-u-s-says.html
- http://www.silverbearcafe.com/private/saudireserves.html

And the second point - the implication that there is a ton in the ground because only 1 in 8 fields is being tapped - I think you will find that all the big fields are indeed in production and the rest are small fry. That was the Matt Simmons argument.

Or do you have do you have a source that backs up the impression Saudi are only tapping an eighth of what they have?

[mheslep]

I went back and caught all of Brown's narrative. Ug. I did not find it instructive.

[mheslep]

Somewhere in the presentation early on Brown states, "the area under the [Hubbert] curve gives the ultimate recoverable reserves". I'm not inclined to argue with Brown per se, but I grant the point seems common in the peak oil discussion. So here's an example showing my problem with the assertion. Below is the coal production in the UK from 1900 to ~now.

http://i52.tinypic.com/2yy5bnr.png

The earlier history shows an increase similar to this century's decrease; ~1850 had 50 mt/year, about the same as todays, with production peaking in 1913 at 260 mt/year. Taken together this makes a nice 'Hubbert' curve from 1845, peaking in 1913, and tailing off to today. Roughly, the area under that curve (by linear approximation), or the total recoverable coal per Brown, in the UK should have been ~16,000 mt from beginning to end, leaving only dwindling scraps now.

That conclusion is wildly wrong. Various geologic surveys show up to 45,000 mt of "technically recoverable" (http://www.coal.gov.uk/media/860AD/Response%20to%20Energy%20Review%20-%20Appendix%202.pdf) coal in the UK. These surveys don't speculate on coal at sci fi depths either, they're limited to no deeper than 4000 ft. Economics, not depletion, has done away with UK coal production. We can speculate on several reasons: the rise of North Sea oil, cheaper US and Chinese coal, expense of exporting coal solids, perhaps mines planned poorly long ago mines, now collapsed and flooded, that would still be economic if constructed properly to begin with, and so on.

[apeiron]

We have (here) on this subject one respectable reference, that from the Economist on Saudi production, and no references at all to contradict it.

Again, the issue is not the raw number of Saudi fields (well it is insofar it is a state secret) but the size of them. So this is what you need to provide evidence for. Otherwise the statement seems intentionally deceptive.

Wiki says...http://en.wikipedia.org/wiki/Oil_reserves_in_Saudi_Arabia

Although Saudi Arabia has around 100 major oil and gas fields, over half of its oil reserves are contained in only eight giant oil fields, including the Ghawar Field.

Despite its large number of oil fields, 90 percent of Saudi Arabia's oil production comes from only five fields and up to 60 percent of its production comes from the Ghawar field.[7]

Since 1982, the Saudis have withheld their well data and any detailed data on their reserves, giving outside experts no way to verify Saudi claims regarding the overall size of their reserves and output.

So we can see the powerlaw distribution of reserves that makes a "1 in 8" comment meaningless.

If Saudi has managed to hide a few more Ghawars up its sleeve, that would not only be a triumph of secrecy unparalleled, but it would also look rather out of line with basic statistical probability here.

A little more source is required, no matter how respected :rofl: you find the Economist.

[mheslep]

In response to Brown's main point, internal consumption will rapidly grow to eat internal production of todays oil exporters, here's the data on Canada. (http://www.eia.doe.gov/cabs/canada/Oil.html) BTW Canada, not Mexico, is the largest petroleum exporter to the US (http://www.eia.doe.gov/pub/oil_gas/petroleum/data_publications/company_level_imports/current/import.html) contrary to Brown's assertion in the talk (maybe it was true then).

http://www.eia.doe.gov/cabs/canada/images/oil_production.gif

That is, Canadian net exports have increasing mostly continuously since ~1990. To go off and speak at Sandia on a net exports theory and ignore this fact is reckless.

[mheslep]

Again, the issue is not the raw number of Saudi fields (well it is insofar it is a state secret) but the size of them. So this is what you need to provide evidence for. Otherwise the statement seems intentionally deceptive.
[...]
A little more source is required, no matter how respected :rofl: you find the Economist.Then take it up with the Economist, not me.

[apeiron]

We can speculate on several reasons: the rise of North Sea oil, cheaper US and Chinese coal, expense of exporting coal solids, perhaps mines planned poorly long ago mines, now collapsed and flooded, that would still be economic if constructed properly to begin with, and so on.

You can throw in other non-reserve factors too, such as pits were part of the social fabric and spent seams were kept going with subsidies just to provide continuity of local jobs. Thatcher came in and with the bonus of north sea oil was able to take on the mining unions in a power show-down.

But that is beside the point. Hubbert curve thinking is all about the varieties of friction that accumulate and force a shift from a first phase of easy extraction followed by a second of diminishing returns.

Anyway, back to what you were saying about all the untapped Saudi reserves which are known and should give us comfort....

[apeiron]

Then take it up with the Economist, not me.

No fair. You cherry-picked this slide from the presentation and gave it to us out of context.

It seems to me a clear reason why "mainstream" sources can't be trusted - the quote is basically spin.

So you are saying you cannot find support for the 1 in 8 statement and want to close the discussion? OK, I can understand that.

[mheslep]

You can throw in other non-reserve factors too, such as pits were part of the social fabric and spent seams were kept going with subsidies just to provide continuity of local jobs. Thatcher came in and with the bonus of north sea oil was able to take on the mining unions in a power show-down.Exactly, agreed.

But that is beside the point. Hubbert curve thinking is all about the varieties of friction that accumulate and force a shift from a first phase of easy extraction followed by a second of diminishing returns...Not according to Brown in this talk. He clearly states the production curve produces "ultimate recoverable reserves". That might indeed occur sometimes, but as a rule he's simply wrong.

[apeiron]

That is, Canadian net exports have increasing mostly continuously since ~1990. To go off and speak at Sandia on a net exports theory and ignore this fact is reckless.

The Canadian story is a little indeed, err, special given Nafta. :smile:

One implication of this “proportionality clause” is that although as shown in Trends in Canadian Petroleum Production and Consumption, Canada is a net petroleum exporter, it still has to import petroleum to cover the excess (i.e., the excess over net production minus domestic consumption) petroleum it sends to the USA. Up till now that had not been a problem, because importing petroleum from Europe, the Middle East and from the USA, has been cheaper than shipping oil from Western Canada.

http://crash-watcher.blogspot.com/2010/11/canadapetroleum-superpower-or-super.html

[nismaratwork]

Then take it up with the Economist, not me.

Yeah, from someone else I might buy that... not from you. You're way too bright to slip and fall into that one. I'd say, support the post you made with 'The Economist', and find a new source, or remove it. If the problem really is that you can be so easily gulled by this magazine, it may be best that you don't use it as a source.

This discussion over the last two pages has been driven by that piece of misinformation that you're not even willing to support. I find that a bit frustrating from someone as experienced and knowledgeable (according to Gokul, and you... and Russ, and others). Can you think how you might handle this if the situation were reversed... and yeah, I already know how you often have in the past; post records are great.

I'd add, that the Saudi Government ceases to be a meaningful authority in a country of international importance once those resources dry up. Obviously that process, and the possibility of annexation or war, increase as that peak and drop-off approach. I think you could argue that the entirety of Saudi oil production, and the house of Saud in general IS "Machiavellian", and they NOW require that approach. Having painted themselves into a corner politically, and socially with Wahabi Islam... I'd guess the greatest fear of anyone with a stake in SA is in fact that the oil-horizon appears.

[apeiron]

A little more on the near-term view on peak oil and conventional reserves.

1) Does Saudi have a lot more up its sleeve?

Here you can contrast the views of two top former Aramco staff. Here is a good WSJ analysis.

http://saudioilproduction.blogspot.com/2008/06/saleri-and-husseini.html

Husseini is sticking to his guns as recent interviews already cited show. And here from his own company website he still emphasises this key quote.

Husseini expressed a negative view about the world's proved oil reserves—
“[World] reserves are confused and in fact inflated. Many of the so called reserves are in fact resources. They’re not delineated, they’re not accessible, they’re not available for production”. By [Al-Husseini's] estimate 300 billion of the world’s 1200 [billion] barrels of proved reserves should be recategorized as speculative resources.
http://www.husseinienergy.com/Press_Releases_Details.aspx?Id=6

You can also check actual production figures for Saudi, which have bumped along at under 9.5 mbd for some years.
http://earlywarn.blogspot.com/2010/07/latest-saudi-arabian-oil-production.html

This does not tell us much I agree. The Saudi's claim to have the capacity as the world's swing producer to pump 12.5 mbd if needed (and Husseini says that's a fact). But with the oil spike/credit crunch/recession, the claim has not had to be tested.

But remember also the US wants Saudi to push production up to 15 mdb this decade. Which is what will show whether Saudi is actually mature as a producer or is stiil sitting on a hidden stash.

2) The actual big hope that Mheslep did not mention is Iraq. The obvious reason for effecting regime change was to get Iraq up from a measely 2 mbd to the 12 mbd where it "should be" for US economic interests and to fully exploit its reserves.

If everything goes smoothly and production gets ramped up in six years (an unparalleled increase in drilling, terminal building, etc) then Iraq could delay peak oil about a decade some say.

http://earlywarn.blogspot.com/2009/12/iraqi-oil-production-history.html

[mheslep]

I'm inclined to think CERA's estimates are most reliable. That is, if the demand is there and I don't think it will be.

http://www.cera.com/aspx/cda/imageDisplays/imageDisplay.ashx?PK=16152&t=Image&f=gImageData&n=iImagePK

http://www.cera.com/aspx/cda/public1/news/pressReleases/pressReleaseDetails.aspx?CID=8444

[apeiron]

I'm inclined to think CERA's estimates are most reliable. That is, if the demand is there and I don't think it will be.


I'm inclined to think Cera is at least as reliable as the Economist :wink:. But anyway, shouldn't you really be citing their most recent revised version of this graph?

https://www.cera.com/aspx/cda/client/report/reportImageDisplay.aspx?KID=5&CID=10720&IID=21246

Or the full report download...
https://www.cera.com/aspx/cda/filedisplay/publicfiledisplay.ashx?KID=5&CID=10720&PK=38356

Your earlier Cera graph shows plenty of growth in conventional oil production yet. The latest one looks to, err, have peaked, sorry to say. Average across all the spurious bumps of their undulating plateau and the line looks pretty flat at 85 mbd to me.

Unconventional oil still does roar away. But not nearly to the same extent as in the earlier graph.

Things overall look flat from 2020 at around 110 mbd. Then compare this current prediction to the one you cite which says supply will soar in a straight line to 135 mbd by 2035, only then peaking and flattening out.

So Cera may be reliable. It also seems to have changed its tune drastically in the space of a few years.

Like the IEA recent conversion to peak-ism, everyone's views are converging as they should. You would not be able to tell this just from Cera's rhetoric of course. So thanks for bringing attention to the graphs.

[nismaratwork]

I'm inclined to think Cera is at least as reliable as the Economist :wink:. But anyway, shouldn't you really be citing their most recent revised version of this graph?

https://www.cera.com/aspx/cda/client/report/reportImageDisplay.aspx?KID=5&CID=10720&IID=21246

Or the full report download...
https://www.cera.com/aspx/cda/filedisplay/publicfiledisplay.ashx?KID=5&CID=10720&PK=38356

Your earlier Cera graph shows plenty of growth in conventional oil production yet. The latest one looks to, err, have peaked, sorry to say. Average across all the spurious bumps of their undulating plateau and the line looks pretty flat at 85 mbd to me.

Unconventional oil still does roar away. But not nearly to the same extent as in the earlier graph.

Things overall look flat from 2020 at around 110 mbd. Then compare this current prediction to the one you cite which says supply will soar in a straight line to 135 mbd by 2035, only then peaking and flattening out.

So Cera may be reliable. It also seems to have changed its tune drastically in the space of a few years.

Like the IEA recent conversion to peak-ism, everyone's views are converging as they should. You would not be able to tell this just from Cera's rhetoric of course. So thanks for bringing attention to the graphs.

Wow, that's a real 180 turn in their graphs. How the hell did you miss that mheslep? First the Economist, now this... I thought the idea was that we didn't have to fact-check each other. :grumpy:

[mheslep]

I'm inclined to think Cera is at least as reliable as the Economist :wink:. But anyway, shouldn't you really be citing their most recent revised version of this graph?

https://www.cera.com/aspx/cda/client/report/reportImageDisplay.aspx?KID=5&CID=10720&IID=21246

Or the full report download...
https://www.cera.com/aspx/cda/filedisplay/publicfiledisplay.ashx?KID=5&CID=10720&PK=38356Thanks

Your earlier Cera graph shows plenty of growth in conventional oil production yet. The latest one looks to, err, have peaked, sorry to say.Why are you sorry?
Average across all the spurious bumps of their undulating plateau and the line looks pretty flat at 85 mbd to me.So?

Unconventional oil still does roar away. But not nearly to the same extent as in the earlier graph.

Things overall look flat from 2020 at around 110 mbd. Then compare this current prediction to the one you cite which says supply will soar in a straight line to 135 mbd by 2035, only then peaking and flattening out.

So Cera may be reliable. It also seems to have changed its tune drastically in the space of a few years. About resources? If you read the report you'd know that, no, they have not. The changes in production are due to changes in other factors, primarily demand. In neither the older or the newer report to they show any calamitous decline in production. As I said above about the earlier CERA production estimate, "if the demand is there and I don't think it will be." As CERA says in the recent report:
Supply evolution through 2030 is not a question of resource availability.
there should be more than an adequate inventory of physical resources available to increase supply to meet anticipated levels of demand in this time frame. Post-2030 supply may well struggle to meet demand, but an undulating plateau rather than a dramatic peak will likely unfold. Moreover, if the “peak demand” now evident in the OECD countries is a precursor of later developments in the emerging markets, world demand itself could eventually move on to a different course.*
But much will happen before then that will affect demand—from changes in the automobile engine and the electric battery to changes in demographics and values. That is why the concept of “peak demand” is so important. Ironically, it may come to be viewed in retrospect as the main driver of peak supply. In that case what happens aboveground will have set the tempo for what happens belowground.

[apeiron]

About resources? If you read the report you'd know that, no, they have not. The changes in production are due to changes in other factors, primarily demand. In neither the older or the newer report to they show any calamitous decline in production. As I said above about the earlier CERA production estimate, "if the demand is there and I don't think it will be." As CERA says in the recent report:

But the problem here is that you are asking us to trust people like the Economist and Cera when these are not transparent sources. You call them reliable. On what basis?

Cera is a private firm that keeps its data to itself. The report is a gloss. We don't know the methodology and we don't have the raw figures. And the fact their own projections can jump around so much should ring alarm bells. Why are you so unconcerned?

When you have one projection that says the world will produce a total of 3.6 trillion barrels by 2070, then a second one that says it will be now 2.4 trillion, well that is quite a gap.

Surely something must have changed even if, as you agree, Cera's rhetoric hasn't :uhh:.

Cera's position is that we can ignore oil reserves because they are effectively unlimited. But as said, the data that might justify that view is not being made public by Cera and is contested by, among others, the recent head of production at Aramco.

Given that stance, then of course Cera's argument becomes that we will produce as much as the market demands. We can model some demand damping due to the rising cost of unconventional production, or due to more conservative pumping to eke out fields for the longest, etc.

But assuming no constraint on actual reserves is such a big leap that it needs to be properly sourced here.

[nismaratwork]

...And again, there are compelling reasons for people with a great deal of money and influence to make "peak oil" a surprise... you know... like the housing crash. Ultimately oil is a kind of Ponzi scheme at the highest level, with principalities and wealth awarded to some, diffusing down the line. When that goes, it's going to go all at once, and given the stability of the region:weapons... :eek:

[mheslep]

But the problem here is that you are asking us to trust people like the Economist and Cera when these are not transparent sources. You call them reliable. On what basis? I am not asking you trust them apeiron, these are forecasts after all. Make up your own mind, as you will certainly do anyway with out my encouragement. I list them here only as mainstream sources, which is the habit of this forum. That is, they're not crackpot or conspiracy or "myoiltruthblog.org" sources, but they're no more the final truth on a subject than an article from the NYT or the WSJ. CERA is different in that it is not a news source but a private consulting firm. I find them more reliable than the numerous other forecasters out there because they are a longstanding professional organization, with an excellent reputation, including numerous experts in economics, the energy industry, and scientists. Its founder is a world famous pulitzer prize winner on energy.

Cera is a private firm that keeps its data to itself. The report is a gloss. We don't know the methodology and we don't have the raw figures. And the fact their own projections can jump around so much should ring alarm bells. Why are you so unconcerned?

When you have one projection that says the world will produce a total of 3.6 trillion barrels by 2070, then a second one that says it will be now 2.4 trillion, well that is quite a gap.

Surely something must have changed even if, as you agree, Cera's rhetoric hasn't [...]Yes indeed something has changed! As the report says, and I'll say one more time before moving on, demand has changed; demand forecasts are changing drastically in OECD countries from five years ago. World petroleum consumption did not increase, it actually dropped in 2008. US oil consumption in particular has declined every year since 2005. That doesn't mean it will continue to do so, but the recent consumption history facts certainly are a large change from the ever increasing oil consumption forecasts of a few years ago.

Cera's position is that we can ignore oil reserves because they are effectively unlimited.That's a strawman, they say the opposite.
Of course looking further ahead, it is important to recognize that oil is a finite resource ...

[nismaratwork]

I am not asking you trust them apeiron, these are forecasts after all. Make up your own mind, as you will certainly do anyway with out my encouragement. I list them here only as mainstream sources, which is the habit of this forum. That is, they're not crackpot or conspiracy or "myoiltruthblog.org" sources, but they're no more the final truth on a subject than an article from the NYT or the WSJ. CERA is different in that it is not a news source but a private consulting firm. I find them more reliable than the numerous other forecasters out there because they are a longstanding professional organization, with an excellent reputation, including numerous experts in economics, the energy industry, and scientists. Its founder is a world famous pulitzer prize winner on energy.

Yes indeed something has changed! As the report says, and I'll say one more time before moving on, demand has changed; demand forecasts are changing drastically in OECD countries from five years ago. World petroleum consumption did not increase, it actually dropped in 2008. US oil consumption in particular has declined every year since 2005. That doesn't mean it will continue to do so, but the recent consumption history facts certainly are a large change from the ever increasing oil consumption forecasts of a few years ago.

That's a strawman, they say the opposite.

re bold: Hardly; it's just an observation that the CERA model has plentiful oil long after we're all dead... hence "effectively.

Oh, and I'd be much happier of the founder was a Nobel rather than a Pulitzer winner.

[apeiron]

This should be a thought provoking graph. It shows the close relationship between oil prices and food prices. So for anyone arguing for energy substitution scenarios, one question here is whether there is a substitute for oil when it comes to food production. And also what are the prospects for political stability in the world's poor and populous countries if oil prices must double, treble, etc, as they would do if we have to move heavily into unconventional sources of petroleum.

http://www.paulchefurka.ca/Oil_Food.html

http://www.paulchefurka.ca/Oil_Food.png

[PhilKravitz]

It all seems to be unfolding just as projected in "The Limits to Growth" book from 1972(?).

[mheslep]

This should be a thought provoking graph. It shows the close relationship between oil prices and food prices.Yes, and it shows why oil prices and not necessarily corn based ethanol production should be the place to look for as a cause in the spikes in food prices.

So for anyone arguing for energy substitution scenarios, one question here is whether there is a substitute for oil when it comes to food production.Why not? Food is not literally made from oil; it is the ancillaries - transportation, etc - that need alternatives.

And also what are the prospects for political stability in the world's poor and populous countries if oil prices must double, treble, etc, as they would do if we have to move heavily into unconventional sources of petroleum.Treble? Tar sand oil is making money at $40/bbl. Why must unconventional fossile fuels, renewable liquids, and electric transportation reach an equivalent of 3X current $/bbl costs?

[PhilKravitz]

Why not? Food is not literally made from oil; it is the ancillaries - transportation, etc - that need alternatives.


The primary energy input is human made fertilizer.

[apeiron]

Why not? Food is not literally made from oil; it is the ancillaries - transportation, etc - that need alternatives.

As Phil says, fertilizer is a major input. Agricultural machinery and world transport rely on a portable liquid fuel source. So petroleum is behind the green revolution - in a way that nuclear or wind can never be directly, and indirectly, well that quickly becomes expensive.

But an aside you might quickly be able to answer. What about the fact that both commodities are denominated in US dollars here, so the correlation could merely reflect currency fluctuations - dollar against a world average?

I didn't think this was a factor, the dollar being the de facto world currency, but maybe it is?

Treble? Tar sand oil is making money at $40/bbl. Why must unconventional fossile fuels, renewable liquids, and electric transportation reach an equivalent of 3X current $/bbl costs?

Do you have a good analytical paper to back up the $40 figure? I know it is widely quoted. But history also shows that the oil industry goes for the cheapest, easiest development first, so what is break-even for early fields is not going to be the cost when production is in earnest.

If Canadian voters force producers to factor in the cost of environmental degradation, then again, the numbers will not seem so pretty.

The simple EROEI means that tar sands can never match the cheapness of sweet crude. The Canadians might accept wafer profit margins instead of extracting an Opec style profit on each barrel. Or then again, in a free market, they might sting the US for all it is willing to pay eventually. :smile:

[PhilKravitz]

"Tar sand oil is making money at $40/bbl." I do not support or deny this statement. But one of the major inputs to making tar oil is natural gas to cook the sand. So we have to modify the statement to say "at X $ per cubic foot for natural gas tar sand is profitable at $40/bbl" I do not know what X is assumed by those making the statement.

[apeiron]

More on tar sands....the criticisms run along the lines of too much carbon produced, too much water consumed, and even just physically scaling up the production is a major constraint.


http://www.ceres.org/Page.aspx?pid=1251

Shrinking profit margin: The costs of producing oil sands - already the world's most expensive source of new oil - are rising and will continue to do so due to the onset of carbon pricing, higher input commodity prices, and rising costs for water treatment and land reclamation. As a result, global oil prices will need to remain high - possibly approaching $100 per barrel - to ensure a competitive rate of return on $120 billion in planned expansion projects. Oil sand operators must also be mindful that if global oil prices get too high, between $120 and $150 a barrel, it will likely reduce global oil demand and shift markets in favor of alternative fuels.

Water and Other Resource Constraints: Oil sands production is highly water intensive, with up to four barrels of freshwater consumed for every barrel of oil produced from surface mining extraction. Water withdrawals from the Athabasca River watershed are already restricted during winter months to protect fish habitat. If oil sands production volume grows according to companies' estimates, some oil sands mining operations could exceed their wintertime allowances as early as 2014, causing possible production interruptions. Climate change may also exacerbate this situation; glaciers feeding into the Athabasca River watershed are already shrinking.

Growing Land Reclamation Costs/Liability: After 40 years of production, no oil sand companies have yet fully reclaimed the extensive tailings ponds used for holding polluted wastewater. This is because the fine tailings in these ponds take decades to settle out. These tailing ponds, already covering an area the size of Washington D.C., pose risks of contaminating adjoining lands and water resources, and present health problems in downstream communities. Alberta's Directive 74 requires oil sands miners to speed up remediation of existing ponds – an order that creates especially large liabilities for the industry's legacy miners such as Suncor and Syncrude.

[PhilKravitz]

I am sure Canada will be left just as clean as Nigeria.

[apeiron]

Reflecting the difficulties of ramping up production to "commercial scale", the actual goals are quite modest anyway.


Oil sands companies in Alberta are already producing 1.3 million barrels a day, and their goal is to triple production by 2030.

http://www.globe-net.com/articles/2010/may/24/financial-risks-of-oil-sands-greater-than-bps-gulf-oil-spill.aspx?sub=12

[nismaratwork]

I am sure Canada will be left just as clean as Nigeria.

When has Nigeria ever been anything like Canada in terms of geography, population density, or social and religious divisions? I don't see Canada being worried, but rather pleased as they sit on something that is more and more valuable: fresh water. We CAN live without oil, however it might set us back; no water = dead. Oil and fuel have started wars, but they're open to a lot of economic room too... water often leads to conflict.

So, I guess Canada might be terrified that they'll make lots of money, unless you think the USA is going to follow the script of a South Park movie?

[PhilKravitz]

. water often leads to conflict.


Yes water from the Canadian northwest is important to continued development of the US southwest.

[nismaratwork]

Yes water from the Canadian northwest is important to continued development of the US southwest.

...And how does that lead to Canada as Nigeria?

[PhilKravitz]

...And how does that lead to Canada as Nigeria?

it addresses the question of water needs can lead to conflict.

Nigeria has oil and is being exploited by the global corporations (no clean up), Canada has oil (oil sand) and is being exploited by the global corporations. Already the government is unhappy with the slow rate of clean up. How will they force clean up? They have failed to do so over the past 20 years according to a previous post not mine.

[Evo]

it addresses the question of water needs can lead to conflict.

Nigeria has oil and is being exploited by the global corporations (no clean up), Canada has oil (oil sand) and is being exploited by the global corporations. Already the government is unhappy with the slow rate of clean up. How will they force clean up? They have failed to do so over the past 20 years according to a previous post not mine.Please post links to the valid sources that prove your statements to be facts.

You have been making a lot of statements of *facts* in a number of threads without ever providing evidence when asked. Do not post here again until you furnish proof.

[nismaratwork]

it addresses the question of water needs can lead to conflict.

Nigeria has oil and is being exploited by the global corporations (no clean up), Canada has oil (oil sand) and is being exploited by the global corporations. Already the government is unhappy with the slow rate of clean up. How will they force clean up? They have failed to do so over the past 20 years according to a previous post not mine.

I'm going to do this, because I suspect you've never been taught about causal vs. casual relationships. Beyond that, would've just asked what Evo is: where do you get this stuff?


So: Here it is...

I found a good version via 'teh googlez..zuh':

Probably the single most important concept that I learned in a college class was the importance of the having the right comparison information when evaluating the importance of a statistic. The question should always be: relative to what?

Example: Someone says 90% of serial killers drink milk. People instinctively think milk somehow causes serial killers. Putting aside the fact that correlation is not necessarily causation, the statistic is only one of four pieces of information you need to evaluate the significance of the claim. What you really need is below:
Serial Killers Non-Serial Killers
Drink Milk 90% 89%
Don't Drink Milk 10% 11%

Now the claim is seen for the more or less trivial thing that it is. But so often just one of those numbers is given, and people assume the rest.
@http://www.metafilter.com/99598/What-scientific-concept-would-improve-everybodys-cognitive-toolkit


Note, that's not a citation, but it's a good example of a logical principle you need to get on, right away.

[apeiron]

Please post links to the valid sources that prove your statements to be facts.

You have been making a lot of statements of *facts* in a number of threads without ever providing evidence when asked. Do not post here again until you furnish proof.

It twas I that cited the Ceres study...

Growing Land Reclamation Costs/Liability: After 40 years of production, no oil sand companies have yet fully reclaimed the extensive tailings ponds used for holding polluted wastewater. This is because the fine tailings in these ponds take decades to settle out. These tailing ponds, already covering an area the size of Washington D.C., pose risks of contaminating adjoining lands and water resources, and present health problems in downstream communities. Alberta's Directive 74 requires oil sands miners to speed up remediation of existing ponds – an order that creates especially large liabilities for the industry's legacy miners such as Suncor and Syncrude.

The WWF has a campaign going....

Oil sands extraction uses significant amounts of water (2-4.5 barrels per barrel of oil produced), which ends up in toxic tailings lagoons that have never been successfully reclaimed. An analysis using industry data estimated that these lagoons already leak over a billion gallons of contaminated water into the environment each year.
http://dirtyoilsands.org/thedirt/article/quick_facts/

More detail from the actual Ceres report....

In 40 years of oil sands production, no tailings ponds have yet been fully reclaimed. That is because, while mature fi ne tailings settle out after three to fi ve years, the fi ne tailings remain suspended. As a result tailing ponds could substantially alter the surrounding ecosystem by contaminating soil and water sources, presenting both health problems to downstream communities and the potential of a catastrophic breach. This issue is one of the oil sands industry’s biggest long-term environmental challenges, especially for legacy oil sands miners like Suncor and Canadian Oil Sands Trust.

As discussed in Chapter 2, Alberta’s Energy Resources Conservation Board (ERCB) is tightening oil sands tailings management under Directive 74. Th is directive requires mined oil sands producers to remediate existing tailings ponds, where disposal has been completed, within fi ve to eight years, and progressively recycle more tailings in the future. Because fi ne tailings (FT) take as long as 40 years to settle, and current technology is not yet able to expedite this process, companies may be forced to use alternative processes such as bioremediation or Suncor’s proprietary MFT drying and accelerated dewatering process to meet the schedule set by the ERCB.

..If bioremediation were used to treat new tailings production, our analysis indicates that Imperial Oil could see a 6-17% increase in its debt-to-capitalization ratio, and Canadian Oil Sands Trust (COST) could see a 10–26% increase, in order to cover the added asset retirement obligations for existing tailings sands projects.

..Taken together, water management and land reclamation are major issues that get minimal attention on oil sands producers’ balance sheets.

Nigeria = Canada might be hyperbole, but - along with the Nafta arrangement I cited in #245 - Canada does seem surprisingly compliant about doing what it takes to get oil sands up and going. Compare for instance US reaction to a little spillage in its gulf.

“What is happening at the moment in the oil sands of Alberta is kind of like the Gulf spill, but playing out in slow motion,” [said] RiskMetrics study co-author Doug Cogan.

[PhilKravitz]

Please post links to the valid sources that prove your statements to be facts.

You have been making a lot of statements of *facts* in a number of threads without ever providing evidence when asked. Do not post here again until you furnish proof.

I was citing post #264

"Growing Land Reclamation Costs/Liability: After 40 years of production, no oil sand companies have yet fully reclaimed the extensive tailings ponds used for holding polluted wastewater. This is because the fine tailings in these ponds take decades to settle out. These tailing ponds, already covering an area the size of Washington D.C., pose risks of contaminating adjoining lands and water resources, and present health problems in downstream communities. Alberta's Directive 74 requires oil sands miners to speed up remediation of existing ponds – an order that creates especially large liabilities for the industry's legacy miners such as Suncor and Syncrude."

if you do not like post 264 please tell him/her to also stop.

[nismaratwork]

I was citing post #264

"Growing Land Reclamation Costs/Liability: After 40 years of production, no oil sand companies have yet fully reclaimed the extensive tailings ponds used for holding polluted wastewater. This is because the fine tailings in these ponds take decades to settle out. These tailing ponds, already covering an area the size of Washington D.C., pose risks of contaminating adjoining lands and water resources, and present health problems in downstream communities. Alberta's Directive 74 requires oil sands miners to speed up remediation of existing ponds – an order that creates especially large liabilities for the industry's legacy miners such as Suncor and Syncrude."

if you do not like post 264 please tell him/her to also stop.

Oh don't do this... it's not a fight you could win if you were RIGHT, and you're not. You drew some link between the fate of NIGERIA, which has been a basket case for longer than we've needed their oil, and Canada! One is a poor african nation ruled by a small elite, and the other is an advanced nation with international allies and a good military.

The US shares a HUGE border with Canada... they would be INSANE to ever attack them outright, and besides, why fight for what you can just BUY? We provide extra security from those who WOULD invade, and we import.

You keep making your problems the problems of WhoWee, or me, or another post... and now Evo?! I'm telling you, if she's asking for something, it's a HUGE favor and hint; she could just delete your posts and you! Please, stop for a minute or a night, then just don't make a claim you can't source in accordance with PF rules. Nothing that's being asked is unreasonable, even in a CASUAL conversation given what you've claimed, and this is a STEM forum.

[apeiron]

I don't see Canada being worried, but rather pleased as they sit on something that is more and more valuable: fresh water. We CAN live without oil, however it might set us back; no water = dead.

I like a good dust-up as much as anyone o:) but the issues here a little more important than the usual.

And I have already highlighted how tar sands and water resources are entwinned.

Here in Canada...a new water management framework under development for the lower Athabasca River will place tighter limits on the amount of water that can be withdrawn from the river to support the world’s largest energy project, the Alberta oil sands.

http://watercanada.net/2010/water-footprints/

So Canada's water is already under stress so far as tar sands exploitation goes.

[nismaratwork]

I like a good dust-up as much as anyone o:) but the issues here a little more important than the usual.

And I have already highlighted how tar sands and water resources are entwinned.



So Canada's water is already under stress so far as tar sands exploitation goes.

Yes, but how does this lead to the state of hell that is Nigeria? I can see conflict; I don't believe that conflict will follow the Nigerian model, or even be military. I'd add... Canada is big. Saying that tar sands = All of Canada being stripped and will end like Nigeria strikes me as being naive on the order of expecting to be, "welcomed as liberators."

[apeiron]

Yes, but how does this lead to the state of hell that is Nigeria? I can see conflict; I don't believe that conflict will follow the Nigerian model, or even be military. I'd add... Canada is big. Saying that tar sands = All of Canada being stripped and will end like Nigeria strikes me as being naive on the order of expecting to be, "welcomed as liberators."

Err, all Phil actually said was that Canada would be left as clean as Nigeria (and he could have meant "mighty clean" so far as this bare statement went). So you have jumped to a pretty extreme interpretation of a quick quip.

Canada is certainly in a position to impose its own environmental clean-up standards. The question is how well is it handling tar sands so far?

About as well as a corrupt, poor and exploited third world nation? Or like the country with a proud tradition of foresight and social responsibility that I have long imagined it to be?

If you have evidence that pertains to this specific question - the one Phil clearly implied - then this is certainly the time to bring it to the table. All the rest is some personal feud.

(Hey, maybe PF should have a forum for "give me your best shot" flaming. And bring back all those who've departed with a ---------- through them.)

[nismaratwork]

Err, all Phil actually said was that Canada would be left as as Nigeria (and he could have meant "mighty clean" so far as this bare statement went). So you have jumped to a pretty extreme interpretation of a quick quip.

I have if I'm wrong, and that's based on more than one quip. Let me ask you, because I know you enjoy a good debate and I don't want to jump to conclusions: do you think I jumped to a conclusion here? I've been to Nigeria, so, "clean as Nigeria", and "Mighty Clean" are oxymoronic, and since Canada is already pretty damned clean compared to many other large nations (low population density... key)... it's absurd.

Given that, it's an extraordinary claim based on literally nothing except the conjecture of the kind of people who failed to predict far more proximal events such as Tunisia and Egypt. Prognostication is a losing game, to summarize a wiser person.

Canada is certainly in a position to impose its own environmental clean-up standards. The question is how well is it handling tar sands so far?

About as well as a kid with a new toy, but that's a long way from any social, political, or environmental element of Nigeria. I'm sorry, it's a terrible comparison, and thus much of what follows is necessarily based on this flawed premised.

About as well as a corrupt, poor and exploited third world nation? Or like the country with a proud tradition of foresight and social responsibility that I have long imagined it to be?

More towards the latter, but with strong elements of the former. Until I see actions that aren't just irresponsible and newly runaway, but actually malicious, it's not very similar at all. You could compare mining around the world, but really, you'd be mad to compare the life of a coal miner in Whales, to a blood diamond miner who gets cavity searched once a day, and paid crud.

Canada is likely to do some serious damage before they reign in the desire to make money in this hysterical market. That said, they could turn Alberta into a wasteland, and you'd still have Nigerians marveling at the overall beauty of Canada. In short, it's just an absurd comparison in every sense; scale, social justice, ability to rapidly change course without engendering chaos... it goes on.

Besides, their water is ALSO a monetary investment in their water staying clean, and destroying that would be foolish. That doesn't mean it won't happen, but it would be surprising.

If you have evidence that pertains to this specific question - the one Phil clearly implied - then this is certainly the time to bring it to the table. All the rest is some personal feud.

(Hey, maybe PF should have a forum for "give me your best shot" flaming. And bring back all those who've departed with a ---------- through them.)

You're entitled to your opinion, including reporting me; I'm guessing your standing is far better than mine so you'd likely do well. I can only say that only "personal" element here is that his posts consistently make gross generalizations with no support. Maybe you should read some more of them before you leap to his defense, to the point of near absurdity on the, "clean" issue.

We both know you're too bright to believe that, and this is politics, not philosophy... there is less wiggle room when you have to deal with objective reality.

[mheslep]

But an aside you might quickly be able to answer. What about the fact that both commodities are denominated in US dollars here, so the correlation could merely reflect currency fluctuations - dollar against a world average?

I didn't think this was a factor, the dollar being the de facto world currency, but maybe it is?I'm not sure. Price of gold correction? Other than that I don't know. The US$ price of Gold is up maybe ~40% (http://www.goldprice.org/gold-price-history.html) in the last two years, tailing off just in the last month. So if one accepts gold as a standard, a constant supply commodity, then you could take that 40% out of the oil price as a currency correction, leaving the balance to supply and demand factors.



Do you have a good analytical paper to back up the $40 figure? I know it is widely quotedNo not handy; I'm also just relying on common statements in the mainstream media. Empirically, we know the Canadians kept tar sands substantial production going when oil was down at $55/bbl in early '09, and started operations there years ago when the price was consistently $65-$70/bbl in '06-'07

But history also shows that the oil industry goes for the cheapest, easiest development first, so what is break-even for early fields is not going to be the cost when production is in earnest.Well there's a couple of cost of production factors in play there. First, yes as the tar sands get harder to produce cost will go up, but I don't know that they are anywhere near that point yet. Second, there's the economics of scale - as the operation scales up the cost of production per bbl goes down.


The simple EROEI means that tar sands can never match the cheapness of sweet crude.That may be, but it does not mean 'unconventional oil' sources must cost 3X that of crude. The Canadians might accept wafer profit margins instead of extracting an Opec style profit on each barrel. Or then again, in a free market, they might sting the US for all it is willing to pay eventually. :smile:In a single huge buyer, medium sized seller model market, the buyer also has a lot of authority.

[mheslep]

The primary energy input is human made fertilizer.

As Phil says, fertilizer is a major input.I'm wondering about this one. Best answer I can pull for now is MacKay's swag estimate. He has fertilizer as ~2 kwh/day/person (http://www.inference.phy.cam.ac.uk/withouthotair/c13/page_78.shtml), total food production energy tally 15 kwh/d/person (http://www.inference.phy.cam.ac.uk/withouthotair/c13/page_79.shtml), or 13% of the total.

As far as the fertilizer mass itself, apparently the only fossile fuel energy use goes into the production of ammonia (NH3) based fertilizer via the Haber-Bosch process (http://en.wikipedia.org/wiki/Haber_process), which is the invention that spins all of modern agriculture, and accounts for maybe 2-5% of total natural gas (http://en.wikipedia.org/wiki/Fertilizer#High_energy_consumption) use. In any case what's needed to make NH3 as you might guess is not natural gas, per se, but the hydrogen that tags along natural gas, and water.
N2 + 3 H2 ⇌ 2 NH3

[mugaliens]

In any case what's needed to make NH3 as you might guess is not natural gas, per se, but the hydrogen that tags along natural gas, and water.
N2 + 3 H2 ⇌ 2 NH3

Given that Nitrogen is plentiful in the atmosphere, and Hydrogen is plentiful in water, I suspect the primary reason natural gas is used is to provide both energy for the conversation as well as hydrogen in a chemical form with less binding energy than it exists in water.

Is this correct?

If so, is there an electrochemical process which can be used to manufacture NH3 from just air and water, perhaps a catalyst or two, with no other ingredients used in the process?

[mheslep]

Given that Nitrogen is plentiful in the atmosphere, and Hydrogen is plentiful in water, I suspect the primary reason natural gas is used is to provide both energy for the conversation as well as hydrogen in a chemical form with less binding energy than it exists in water.

Is this correct?

If so, is there an electrochemical process which can be used to manufacture NH3 from just air and water, perhaps a catalyst or two, with no other ingredients used in the process?
1. The current process does NH3 from N from the 'air', and the H from natural gas. The required H could also be produced from water of course, given a lot of energy, taking us back around to the point that energy is nearly always the bottleneck, not material.
2. From what I recall of Bio 101, ammonia is used as fertilizer because plants require nitrogen as part of their photosynthetic metabolism (http://en.wikipedia.org/wiki/Light_reaction), but they're unable to fix N from the air (there are a few exceptions IIRC) as they are able to do for carbon, and can only get N via their root systems.

[Proton Soup]

1. The current process does NH3 from N from the 'air', and the H from natural gas. The required H could also be produced from water of course, given a lot of energy, taking us back around to the point that energy is nearly always the bottleneck, not material.
2. From what I recall of Bio 101, ammonia is used as fertilizer because plants require nitrogen as part of their photosynthetic metabolism (http://en.wikipedia.org/wiki/Light_reaction), but they're unable to fix N from the air (there are a few exceptions IIRC) as they are able to do for carbon, and can only get N via their root systems.

yeah, i think it's just the cheapest way to get the H. iirc, besides electrical hydrolysis, there is also a thermal process for cracking water that uses heat from nuclear power. this was one of the proposals for that "hydrogen economy", which would be more efficient.

[mheslep]

there is also a thermal process for cracking water that uses heat from nuclear power. this was one of the proposals for that "hydrogen economy", which would be more efficient.That depends on the source of energy available. Given a ready source of heat from combustion or even a nuclear reactor then yes thermal chemical cracking is more efficient of the primary energy than first converting the heat to secondary energy in the form or electricity, followed finally by electrolysis. Given the starting point is electricity from, say, PV solar or wind turbines, then I doubt that converting to heat, rather than electrolysis, is more efficient given any practical system that inevitably wastes some heat.

[al loomis]

nuclear isn't an answer, it's just a delay. there is a finite amount of uranium, just like coal and oil. but it's only other use is bombs, it might be a good idea to use up uranium first. that way carbon compounds will be available longer and they are handy for toys.

[apeiron]

But remember also the US wants Saudi to push production up to 15 mdb this decade. Which is what will show whether Saudi is actually mature as a producer or is stiil sitting on a hidden stash.

More confirmation on this front from our friend wikileaks. Bear in mind that the cable dates from late 2007, so knock about three years off all projections :smile:.

http://www.guardian.co.uk/business/2011/feb/08/oil-saudiarabia?intcmp=239

Al-Husseini, who maintains close ties to Aramco executives, believes that the Saudi oil company has oversold its ability to increase production and will be unable to reach the stated goal of 12.5 million b/d of sustainable capacity by 2009. While stating that he does not subscribe to the theory of "peak oil," the former Aramco board member does believe that a global output plateau will be reached in the next 5 to 10 years and will last some 15 years, until world oil production begins to decline.

It is al-Husseini's belief that while Aramco can reach 12 million b/d within the next 10 years, it will be unable to meet the goal of 12.5 million b/d by 2009. The former EVP added that sustaining 12 million b/d output will only be possible for a limited period of time, and even then, only with a massive investment program.

By al-Husseini's calculations, approximately 116 billion barrels of oil have been produced by Saudi Arabia, meaning only 64 billion barrels remain before reaching this crucial point of inflection. At 12 million b/d production, this inflection point will arrive in 14 years. Thus, while Aramco will likely be able to surpass 12 million b/d in the next decade, soon after reaching that threshold the company will have to expend maximum effort to simply fend off impending output declines. Al-Husseini believes that what will result is a plateau in total output that will last approximately 15 years, followed by decreasing output.

Al-Husseini estimates that moving forward, satisfying increases in global demand will require bringing online annually at least 6 million b/d of worldwide output, 2 million to satisfy increased demand and 4 million to compensate for declining production in existing fields.

He estimates that the current floor price of oil, removing all geopolitical instability and financial speculation, is approximately 70 - 75 USD/barrel. Due to the longer-term constraints on expanding global output, al-Husseini judges that demand will continue to outpace supply and that for every million b/d shortfall that exists between demand and supply, the floor price of oil will increase 12 USD.

He stated that the IEA's expectation that Saudi Arabia and the Middle East will lead the market in reaching global output levels of over 100 million barrels/day is unrealistic, and it is incumbent upon political leaders to begin understanding and preparing for this "inconvenient truth."

Al-Husseini was clear to add that he does not view himself as part of the "peak oil camp," and does not agree with analysts such as Matthew Simmons. He considers himself optimistic about the future of energy, but pragmatic with regards to what resources are available and what level of production is possible.

The last comment is a little amusing given the bleak assessment. If you check what people were saying even five years ago, you will see who was closer to "the truth" on this subject.

[Al68]

nuclear isn't an answer, it's just a delay. there is a finite amount of uranium, just like coal and oil.....Sure, but it's a very, very long delay. Centuries (http://en.wikipedia.org/wiki/Uranium_mining) long just counting the uranium that can be mined very cheaply. And that's only a small fraction of the total supply.

Long before we ever get to the point where uranium supply is a problem, nuclear power will be "too cheap to meter", as was once predicted by advocates. If uranium supply was the limiting factor, it would be too cheap to meter now, and would be for a very long time.

[al loomis]

declining energy resources are the best possible news: so far, the only practical way to reduce fossil fuel use is to raise the price and induce economic collapse., this may save us from the venus solution, at the cost of mass starvation, another positive actor on energy use, and the first world food war. it might be the first water war too, but aside from desal, energy neutral.

political management of humanities problems have absurdly ineffectual, but gaia has a range of mechanistic solutions which are coming into play.

[apeiron]

Long before we ever get to the point where uranium supply is a problem, nuclear power will be "too cheap to meter", as was once predicted by advocates. If uranium supply was the limiting factor, it would be too cheap to meter now, and would be for a very long time.

What do you actually mean here? It sounds like you are saying nuclear "done right" would be indeed "too cheap to measure" and only some mysterious factor (it's not limited supply) is preventing this being the case.

Please supply an explanation backed up by sources if this is what you mean.

[Al68]

What do you actually mean here? It sounds like you are saying nuclear "done right" would be indeed "too cheap to measure" and only some mysterious factor (it's not limited supply) is preventing this being the case.I made no claim of any "mysterious" factor. The factors preventing nuclear from being "too cheap to meter" are not "mysterious" at all: nuclear plants (http://en.wikipedia.org/wiki/Nuclear_power_debate#Economics) are very expensive to build and cost almost as much to operate as a coal plant.

But the fuel cost (http://en.wikipedia.org/wiki/Nuclear_power_debate#Economics)is very cheap relative to other plant types.

A cost factor isn't "mysterious" simply because it's unrelated to uranium supply.

[apeiron]

Very interesting to see how various people are spinning the reaction to the leaked cable.

The Wall Street Journal is making sound like el Husseini is backing away from a misinterpretation....
http://blogs.wsj.com/source/2011/02/09/saudi-oil-reserves-and-the-wikileaks-chinese-whispers-effect/

But the meat of the cable is not about the proper interpretation of reserve figures (as mentioned earlier in the thread, even el Husseini's own website is open about this). It is his insider view on actual production.

If the IEA says we are banking on 15 mbd from you guys, and the message back is that we're not sure about getting to 12 mbd yet - and that only for a decade rather than the 50 years Aramco chief recently promised in a public statement - then...whoops.

Meanwhile over at Fox News, there is confusion...
http://mediamatters.org/research/201102090025

"Hey, this is a heck of surprise. Means we better get drilling like crazy in the US again I guess." Where do they get these guys?

And across to the Economist for the most plausible spin...
http://www.economist.com/blogs/freeexchange/2011/02/oil_prices

"The market already knew all this in 2007. And the Saudis have just decided to limit production to get the most dollar out of the decline phase of the Hubert curve."

This is both probably true, and beside the point. The central issue is that the existing economy is based on cheap energy.

If there are other equally cheap substitutes out there (like "too cheap to meter" nuclear), then nothing need change. If basic energy costs double or treble, then this will be a very big shock.

Of course there is huge scope in the most wealthy countries to conserve fuel use. But then also they are the most able to continue to pay the market rate the longest. So cue just huge trouble in the populous poor parts of the world.

Except then, we are talking about some of the major oil producers. Oh well.

[apeiron]

I made no claim of any "mysterious" factor. The factors preventing nuclear from being "too cheap to meter" are not "mysterious" at all: nuclear plants (http://en.wikipedia.org/wiki/Nuclear_power_debate#Economics) are very expensive to build and cost almost as much to operate as a coal plant.

But the fuel cost (http://en.wikipedia.org/wiki/Nuclear_power_debate#Economics)is very cheap relative to other plant types.

A cost factor isn't "mysterious" simply because it's unrelated to uranium supply.

I remain baffled by what you intended by your comments. If it is just that peak uranium is a good way off even if we cranked up the nuclear industry, then that is true.

But the central issue here is about cheap (and portable) energy. So total cost per watt is what would be "cheap" or "expensive".

[Al68]

I remain baffled by what you intended by your comments.What is baffling? My comments were in response to a post saying that nuclear power wasn't a solution because there was only a "finite supply" of uranium.If it is just that peak uranium is a good way off even if we cranked up the nuclear industry, then that is true.Very true and non-baffling and non-mysterious. :smile:But the central issue here is about cheap (and portable) energy. So total cost per watt is what would be "cheap" or "expensive".Right. And the total cost per watt of nuclear power has almost nothing to do with uranium supply.

[mugaliens]

nuclear isn't an answer, it's just a delay. there is a finite amount of uranium, just like coal and oil. but it's only other use is bombs, it might be a good idea to use up uranium first.

All known current reserves will supply the world with power for approximately the next 85 years. However, that's with a conventional reactor, which uses less than 1% of the fissile material. A breeder reactor (http://en.wikipedia.org/wiki/Breeder_reactor)uses nearly all of the fissile material, while simultaneously producing fissile fuel out of non-fissile materials.

[Argentum Vulpes]

I'd like to add the point that current light water reactors (PWR/BWR) only use up about 3% of the potential energy in the fuel rods. Neutron poisons build up in the fuel making the chain reaction less stable (harder to keep going) after about 24 months of full power days. If the USA got back into the reprocessing business much more of the uranium/plutonium in the fuel rods could be "burnt" and make much more energy.

Also with the use of breeder reactors and LFT reactors to bring thorium into the energy market, the human race would be hard pressed to run out of fissionable material to use.

[mheslep]

Even though nuclear the figures above appear fine at a glance, I hope we can keep this thread in the habit of referencing factual claims.

[DrClapeyron]

Can anyone really present a factual claim that nuclear breeder reactors threaten to destroy the US coal and oil industry, leaving millions of people jobless?

I've wondered if the above claim is what prevented new nuclear plants from being built in the 70's and 80's while things like 3 Mile and Chernobyl were just convenient rally cries. Think about what the oil industry means for jobs in the financial market; we go to war over this stuff, spending trillions of dollars to protect oil and currency reserves, and sacrificing countless lives and living conditions to insure that power is kept in the same hand.

I mean, if it did collapse the US oil and coal markets, couldn't we just sell the stuff to poor countries that don't have it? Give them cars, bigger houses and better roads while increasing the US's export sector. Yes, I'm a guiness!

[mheslep]

Can anyone really present a factual claim that nuclear breeder reactors threaten to destroy the US coal and oil industry,...!Yes, with some attention one can at least attempt to demonstrate whether that scenario is a) scientifically possible and b) economically feasible. Why not give it a try? The rest borders on Overly Speculative Posts (http://www.physicsforums.com/showthread.php?t=414380) if anything does. For instance, this
...I've wondered if the above claim is what prevented new nuclear plants from being built in the 70's and 80's while things like 3 Mile and Chernobyl were just convenient rally cries....
Begs for an anti-nuclear hand-waiver to respond in kind: "how could anyone consider nuclear after 3 Mile Island and Chernobyl." And why not, if the only goal is come up with a better conspiracy theory?

[apeiron]

One authorative figure in the peak oil debate is Robert Hirsch, ex manager of research at Exxon, RAND Corporation consultant, director of the US nuclear fusion programme and author of Peaking of World Oil Production: Impacts, Mitigation, and Risk Management, written for the United States Department of Energy.

Catching up on what he has to say these days, there is this recent slide presentation...
http://www.businessinsider.com/the-impending-world-energy-mess-2010-11#-1

Of interest is slide 4 that shows oil production hit a peak in 2004 and has since plateaued.

Slide 6 shows the tight correlation between cheap oil and GDP (evidence that burning oil is the economy basically).

Then slide 10 predicts what is going to happen to the economy given even "a best case mitigation scenario" - the cornucopian belief that technological fixes can ride to the rescue once decline begins.

Hirsh and his colleague are forecasting a 10 percent drop in world GDP in just two years following peak production, about an 18 percent drop after a decade.

The mother of all depressions in other words. It will be worse of course if war and mayhem break out says Hirsh.

There is also this recent Le Monde interview with Hirsh...
http://petrole.blog.lemonde.fr/2010/09/16/interview-with-robert-l-hirsch-12
and
http://petrole.blog.lemonde.fr/2010/09/16/interview-with-robert-l-hirsch-22/

Where he alleges an official policy of cover up....

Q: What happened after you published your 2005 report on ‘peak oil’ for the US Department of Energy (DoE) ?

A: The people that I was dealing with said : « No more work on peak oil, no more talk about it. »

Q: People that were high in the administration hierarchy ?

A: The people that I was dealing with were high in the laboratory level. They were getting their instructions from people on the political side of the DoE, at high levels.

After the work we did on the 2005 study and the follow-up of 2006, the Department of Energy headquarters completely cut off all support for oil peaking and decline analysis. The people that I was working with at the National Energy Technology Laboratory were good people, they saw the problem, they saw how difficult the consequences would be – you know, the potential for huge damage – yet they were told : « No more work, no more discussion. »

Q: That was in 2006, under Bush administration. Has anything changed with the Obama administration ?

A: It has not changed. I have friends who simply won’t talk about it now. So I have to assume that they are receiving the same kind of instructions.

...I think in the case of the United States, that there are people inside the government that understand the problem. I don’t think it’s a huge number of people. And one might say that there is a conspiracy to keep it quiet.

[apeiron]

I made no claim of any "mysterious" factor. The factors preventing nuclear from being "too cheap to meter" are not "mysterious" at all.

Nuclear is an emotional issue. So in the interest of rational assessments, here is the most current relative cost assessments that I have seen (from a fairly pro-nuclear source).

http://web.mit.edu/ceepr/www/publications/workingpapers/2009-004.pdf

we find that the levelized cost of electricity from nuclear power is 8.4¢/kWh, denominated in 2007 dollars. The levelized cost of electricity from coal, exclusive of any carbon charge, is 6.2¢/kWh, denominated in 2007 dollars. The levelized cost of electricity from gas, exclusive of any carbon charge, is 6.5¢/kWh

Of course, the nuclear option has to deal with the question already raised early in this thread (from about post #240) about the practical speed of ramping up construction at a rate to meet the demand.

My starting question on nuclear is, if it is so cheap and clean, how come countries are not already doing it? We seem on the brink and yet the nuclear renaissance is still awaiting lift-off. So either a) goverments are fools, b) nuclear does not actually pan out, or c) fossil fuels are not seen to be an issue (so back to "governments are fools" then o:)).

[nismaratwork]

Nuclear is an emotional issue. So in the interest of rational assessments, here is the most current relative cost assessments that I have seen (from a fairly pro-nuclear source).

http://web.mit.edu/ceepr/www/publications/workingpapers/2009-004.pdf



Of course, the nuclear option has to deal with the question already raised early in this thread (from about post #240) about the practical speed of ramping up construction at a rate to meet the demand.

My starting question on nuclear is, if it is so cheap and clean, how come countries are not already doing it? We seem on the brink and yet the nuclear renaissance is still awaiting lift-off. So either a) goverments are fools, b) nuclear does not actually pan out, or c) fossil fuels are not seen to be an issue (so back to "governments are fools" then o:)).

Can't fear and NIMBY, mixed with our electoral process and strong existing energy lobbies explain it well enough? I think I'll choose "a", but with the addition that the people and the government are, as the Egyptians have been saying so eloquently, "One hand". NIMBY comes from the public, not from the top.

One question: the cost for nuclear power is based in the current economic climate, right? Would that change if the US made a real choice to move from coal to Geiger clicks, and made it an exportable industry?

Your points seem to outline a void in a market that sooner or later (whichever view) is going to need filling and FAST. It seems that we could take the lead from other nations in reactor design, and the benefits that come in materials and other areas as a result. We all got together to send some fellows to walk on our moon, it seems reasonable to "moonshot" a project that could be vital to national security and the world economy.

As you say though, if it's that easy, why aren't we doing it.... and back at square one. *rubs temples*

[apeiron]

Can't fear and NIMBY, mixed with our electoral process and strong existing energy lobbies explain it well enough? I think I'll choose "a", but with the addition that the people and the government are, as the Egyptians have been saying so eloquently, "One hand". NIMBY comes from the public, not from the top.

He's back! :biggrin:

Nimby is of course an issue. On the other hand, when governments really want to do things, they can manipulate public opinion. The US problem is probably that the government wanted to leave it to the free markets and it does in fact require a state-level commitment.

India wants to/must go nuclear in a big way. China and Korea are eyeing up the market leadership position. So the "moonshot" effort may well come from the East if anywhere.

[nismaratwork]

He's back! :biggrin:

Nimby is of course an issue. On the other hand, when governments really want to do things, they can manipulate public opinion. The US problem is probably that the government wanted to leave it to the free markets and it does in fact require a state-level commitment.

India wants to/must go nuclear in a big way. China and Korea are eyeing up the market leadership position. So the "moonshot" effort may well come from the East if anywhere.

True on all counts, and it seems like just another industry we're ceding for no good reason. Still, for humanity at large, it has to come from SOMEWHERE.

[Al68]

....My starting question on nuclear is, if it is so cheap and clean, how come countries are not already doing it?....Who said nuclear power was cheap? Still not understand my comments? The fuel is cheap. Building and operating the plant is expensive.

And countries are already doing it, despite the high initial cost of building a nuclear power plant. And the fact that the fuel is cheap, plentiful, and very, very efficient relative to burning fossil fuels provides an incentive to continue building them, since improved efficiency, technology, efficiency of scale, and innovation can potentially drastically reduce that cost over time. After all, we are talking about a technology in its infancy.

And it should be pointed out that the above claim that nuclear power is inherently "very, very efficient relative to burning fossil fuels" is a monstrous understatement.

[apeiron]

Still not understand my comments?

It was the relevance that was in question.

You could argue wind is cheap too. In fact it cost nothing does it? And it will never run out. However obviously we still have to go a little futher to talk meaningfully about it as a substitute cheap energy.

[mheslep]

One authorative figure in the peak oil debate is Robert Hirsch, ...Well informed, knowledgeable maybe. Not authoritative, especially not on matters of economics. The fact that Hirsch, who still keeps a working IEC (http://en.wikipedia.org/wiki/Inertial_electrostatic_confinement) fusion reactor on his desk that he famously co-invented, attempts to go beyond his field and declaim on worldwide economic predictions discredits him in my view.


Edit:
I see this Hirsch briefing on peak oil (http://www.authorstream.com/Presentation/Nivedi-61110-ASPO2005-Hirsch-PEAKING-WORLD-OIL-PRODUCTION-IMPACTS-MITIGATION-RISK-MANAGEMENT-PRESENTATION-PROBLEM-CON-Business-Finance-ppt-powerpoint/) which says in part (slide 5):
Experts overestimated North American natural gas reserves and future production as late as 2001
...
US natural gas production is now flat and in decline
If wrong on natural gas whats the risk on oil?
Then when I go to check actual US production figures I see this (http://www.eia.doe.gov/dnav/ng/hist/n9050us1m.htm), with US production up nearly 400 billion cf since 2005, and leaves me thinking Hirsch is prone to unsupported, if not crackpot, assertions on at least this subject.
http://www.eia.doe.gov/dnav/ng/hist_chart/N9050US1m.jpg

[mheslep]

Who said nuclear power was cheap? Still not understand my comments? The fuel is cheap. Building and operating the plant is expensive.
Apparently even nuclear construction can be done relatively inexpensively, even if it is not currently inexpensive in the West.
http://www.physicsforums.com/showpost.php?p=2115378&postcount=115

[apeiron]

Well informed, knowledgeable maybe. Not authoritative, especially not on matters of economics.

You may not have noticed that he has two co-authors.....both economists. And economists specialising in energy issues.

Roger H. Bezdek is president of Management Information Services, an economic-research firm. He received his Ph.D. in economics from the University of Illinois at Urbana-Champaign in 1971 and has worked in academia and for the federal government.

Robert M. Wendling is vice president of Management Information Services. He received a master’s degree in economics from George Washington University in 1977. He has served as senior economist at the U.S. Department of Commerce, program manager at the U.S. Department of Energy and director of the Department of Commerce's STAT-USA office

[apeiron]

with US production up nearly 400 billion cf since 2005, and leaves me thinking Hirsch is prone to unsupported, if not crackpot, assertions on at least this subject.

I think your quotes are rather selective and out of context here. Are you saying that in 2005, production was not in decline? Or that in 2001, reserves weren't being over-estimated?

Of course, if you can show sources where Hirsh was calling 2005 already the US peak in natural gas production, then that might have something. But so far you haven't.

In the meantime here is a good assessment of the actual picture on natural gas....being more than a single slide of bullet points easily taken out of context, at least there is something concrete here you can now attack.

http://oilprice.com/Energy/Natural-Gas/Dont-Count-on-Natural-Gas-to-Solve-US-Energy-Problems.html

In summary, a review of information related to US natural gas production (and in particular shale gas production) does not give much confidence that it can ramp up by more than a small percentage over the next 25 years. Even if it can, there is a chance that global warming gases associated with shale gas will suddenly become an EPA concern, and production will need to be scaled back.

There is little evidence that shale gas producers can make money at current low prices. At higher price levels, coal becomes a cheaper alternative, and substitution becomes more difficult. Coal and petroleum consumption is so large in relationship to natural gas consumption that trying to ramp up natural gas to replace more than a very small percentage of these fuels would seem to be impossible.

[Al68]

It was the relevance that was in question.How so? My comments were in response to a claim that a limited supply of uranium stands in the way of nuclear power being a good solution. My obvious point was that uranium supply is irrelevant to the cost of nuclear power. But I pointed that out already, so now I'm baffled as to why my comments were so difficult to understand. :confused:You could argue wind is cheap too. In fact it cost nothing does it? And it will never run out. Yes, and if someone claimed that wind power was expensive due to a limited supply of wind, my response would be similar to my comments in this thread.

[nismaratwork]

Well... wind does run out, just not on a human timescale. I think when our atmosphere is balsted away by an expanding sun, we can rest assured that wind will no longer be a factor.

Wind isn't magic, it's just very VERY plentiful... but not everywhere, not all of the time.

My view: we NEED nucelar power as a stop-gap until we can begin to add storage capcity to the power grid, and that's not coming soon it seems. I don't think giant building-sized liquid batteries count... there need to be storage in the grid, or we need to burn SOMETHING.

[Proton Soup]

can we not just dig down to the magma and steal heat stored in the earth? i mean, how many eons would it last before we shut down the magnetic shield?

[nismaratwork]

can we not just dig down to the magma and steal heat stored in the earth? i mean, how many eons would it last before we shut down the magnetic shield?

Heh... probably a very long time, but then it might be a poor idea to breach a magma chamber by accident, and WOW that equipment would need to be tough. Still, I get your point, and there are other ways to exploit the geomagnetic field... just not cost effective.

If you added storage to wind, solar, and even more exotic means... efficient and reusable capacitor, then suddenly it's not insane to do this. I don't mean one house with a battery, I mean long term serious storage, and a new infrastructure to transmit it.

[Proton Soup]

Heh... probably a very long time, but then it might be a poor idea to breach a magma chamber by accident, and WOW that equipment would need to be tough. Still, I get your point, and there are other ways to exploit the geomagnetic field... just not cost effective.

If you added storage to wind, solar, and even more exotic means... efficient and reusable capacitor, then suddenly it's not insane to do this. I don't mean one house with a battery, I mean long term serious storage, and a new infrastructure to transmit it.

capacitors that don't leak would be a blessing indeed. heck, i need to go look that up again. i was under the impression we had them lasting up to a few days already...

[nismaratwork]

capacitors that don't leak would be a blessing indeed. heck, i need to go look that up again. i was under the impression we had them lasting up to a few days already...

I believe so... I think it was MIT or Caltech (I always forget names) that made some real inroads into "supercapactiors" using various arrangements of carbon. It seems promising to me, but this is an area where my ignorance is profound.

Still, we need more than a few days, or we need a few days dirt cheap. Time... both will take time, and until then we have to consider whether it's coal, or clickclickclick. My preference is nuclear, because frankly with coal moving toward sequestering carbon... toxic waste is toxic waste. If we're going to deal with that, lets at least get our bang for our buck in a proven science.

[Al68]

My preference is nuclear, because frankly with coal moving toward sequestering carbon... toxic waste is toxic waste. If we're going to deal with that, lets at least get our bang for our buck in a proven science.I agree with that, and would add that building and operating nuclear power plants has the added bonus of making us better at building and operating nuclear power plants.

Nuclear power has far greater potential than other energy sources. And currently operating commercial plants are far from representative of that potential.

As a single (but typical of the US Navy nuclear program) example, the USS Eisenhower (http://en.wikipedia.org/wiki/USS_Dwight_D._Eisenhower_%28CVN-69%29) nuclear aircraft carrier was commissioned in 1977, designed and built with nuclear technology in its infancy, and went in for refueling for the first time in 2001, and with a reactor design that very, very safe, to say the least.

Of course commercial nuclear plants are necessarily hamstrung by national security concerns with enriched uranium, but to say there is much room for improvement in commercial nuclear plant technology is a monumental understatement.

[mugaliens]

[QUOTE=Evo;3110457]Please post links to the valid sources that prove your statements to be facts.

This thread is bursting with valid sources, at least a third of 300 worth.

[mugaliens]

If the USA got back into the reprocessing business much more of the uranium/plutonium in the fuel rods could be "burnt" and make much more energy.

A little known fact in the industry is that most nuclear powered subs and surface ships in the US Navy are breeder reactors. I suspect the same is true of the Russian Navy.

[nismaratwork]

I agree with that, and would add that building and operating nuclear power plants has the added bonus of making us better at building and operating nuclear power plants.

Nuclear power has far greater potential than other energy sources. And currently operating commercial plants are far from representative of that potential.

As a single (but typical of the US Navy nuclear program) example, the USS Eisenhower (http://en.wikipedia.org/wiki/USS_Dwight_D._Eisenhower_%28CVN-69%29) nuclear aircraft carrier was commissioned in 1977, designed and built with nuclear technology in its infancy, and went in for refueling for the first time in 2001, and with a reactor design that very, very safe, to say the least.

Of course commercial nuclear plants are necessarily hamstrung by national security concerns with enriched uranium, but to say there is much room for improvement in commercial nuclear plant technology is a monumental understatement.

In a rare fit of total kinship, I agree with literally everything you said. I would emphasize that it just seems mad to cede this potential ingenuity and skill in reactor design out of old fear.

mugaliens: Really? I had no idea. What are the benefits specific to a naval vessel in having a breeder?

[Al68]

In a rare fit of total kinship, I agree with literally everything you said. I would emphasize that it just seems mad to cede this potential ingenuity and skill in reactor design out of old fear.I agree completely (one too many beers? :smile:). Most people just have no idea how much difference there is between commercial nuclear plants and what nuclear power is capable of. I used the USS Eisenhower as an example because I'm a former crew member (Naval nuclear program, decades ago).

And that "ingenuity and skill in reactor design" was decades ago. Much has been learned since then. For example, new aircraft carrier reactor (http://en.wikipedia.org/wiki/United_States_Naval_reactor) cores are designed to last 50 years before refueling. Nuclear power with today's technology could easily power the world's electric demand for the foreseeable future. Very easily and very safely.

[nismaratwork]

I agree completely (one too many beers? :smile:). Most people just have no idea how much difference there is between commercial nuclear plants and what nuclear power is capable of. I used the USS Eisenhower as an example because I'm a former crew member (Naval nuclear program, decades ago).

And that "ingenuity and skill in reactor design" was decades ago. Much has been learned since then. For example, new aircraft carrier reactor (http://en.wikipedia.org/wiki/United_States_Naval_reactor) cores are designed to last 50 years before refueling. Nuclear power with today's technology could easily power the world's electric demand for the foreseeable future. Very easily and very safely.

Yeah, it just drives me up the wall when I consider it. The Russians are still fiddling with old designs, but what if we'd been really funding our nuclear industry instead of paralyzing it? Maybe not, they'd be buying plants from us, and maybe given plant designs they'd have to buy fuel too!

It just seems like throwing away solid gold. I realize that mining for Uranium is not exactly green, but neither is coal. I see people here like Astronuc, and I just wish there had been more like him in the period when "green" became anti-nuclear. Truly, the gift of splitting the atom is harnessing that energy... the bombs are just a messy side-note... albeit one that could wipe us out. By focusing so much on nuclear weapons, I feel the public inextricably links memories of "nuclear" with "Nukes".

[Argentum Vulpes]

A little known fact in the industry is that most nuclear powered subs and surface ships in the US Navy are breeder reactors. I suspect the same is true of the Russian Navy.

I thought the long time between core refueling on US navy nuclear craft was from a highly enriched uranium load, not from breading.

For clarification I was referring to the civilian power side when it comes to reprocessing. The USA has a current mode of operation of once through loads on fuel. Heck even without reprocessing, just repacking, USA light water fuel could get an extended life going through a CANDU reactor. However thanks to anti nuc nuts that plan fell through.

[mugaliens]

Nuclear power with today's technology could easily power the world's electric demand for the foreseeable future. Very easily and very safely.

I've seen estimates ranging between 80 years and 500 years. I suspect the huge variances are due to different assumptions about who gets to use the technology and to what extent. Long enough, hopefully, for us to perfect a fusion solution. From what I gather, we've enough fusion fuel for longer than the Earth will last with an expanding sun about 5 trillion years from now.

Sorry if I'm off on the dates/timelines. I'm remembering from a similar discussion on another science forum from a few years back.

[nismaratwork]

I've seen estimates ranging between 80 years and 500 years. I suspect the huge variances are due to different assumptions about who gets to use the technology and to what extent. Long enough, hopefully, for us to perfect a fusion solution. From what I gather, we've enough fusion fuel for longer than the Earth will last with an expanding sun about 5 trillion years from now.

Sorry if I'm off on the dates/timelines. I'm remembering from a similar discussion on another science forum from a few years back.

I think the fusion dream will be far too late for anyone. I used to think that way, but managing the plasma with magnetic fields isn't exactly easy to scale... what a shock. Even more damning in my eyes, would be the reactor 'blanket', which right now would need to breed enough tritium to keep the reaction going, absorb and transfer enough energy aside from that to be a viable reactor, withstand nearly constant bombardment by high energy neutrons, and run at least 18 hours a day... at LEAST.

No, I think we'll be splitting the atom for a long time to come before a fusion solution we can see currently emerges. New science, and breakthroughs of course, are always welcome to make me look like a fool, and I'm thrilled when they do! I have very little hope for fusion as a viable source of energy in the grid, and if they did emerge we'd need MASSIVE storage to make it viable and serviceable.

Remember, what happens to pretty much EVERY material when it gets the tar knocked out of it by high energy neutron bombardments? BRITTLE... not what you want in your reactor blanket. That... and tritium... do much deuterium so little tritium.

[mugaliens]

I think the fusion dream will be far too late for anyone. I used to think that way, but managing the plasma with magnetic fields isn't exactly easy to scale... what a shock. Even more damning in my eyes, would be the reactor 'blanket', which right now would need to breed enough tritium to keep the reaction going, absorb and transfer enough energy aside from that to be a viable reactor, withstand nearly constant bombardment by high energy neutrons, and run at least 18 hours a day... at LEAST.

No, I think we'll be splitting the atom for a long time to come before a fusion solution we can see currently emerges. New science, and breakthroughs of course, are always welcome to make me look like a fool, and I'm thrilled when they do! I have very little hope for fusion as a viable source of energy in the grid, and if they did emerge we'd need MASSIVE storage to make it viable and serviceable.

Well, that sounds like you're talking about a tokamak. What about laser inertial confinement?

[nismaratwork]

Well, that sounds like you're talking about a tokamak. What about laser inertial confinement?

Impressive, but it's not about to make us rich with fusion power... the same issues are there, minus the confinement issues. A break-even reaction doesn't mean we actually get the energy we put into it back, just that the reaction itself yields as much or more than we put in. CAPTURING it... making that into a viable plant?... I have no idea.

Frankly I thought that blasting holraums was more about the study of nuclear weapons and high energy, as well as the study of fusion... not a viable reactor design.

[apeiron]

Ooh, some action on renewables and subsidies from that nice Mr Obama....


President Barack Obama proposed on Monday boosting funds for clean energy research and deployment in his 2012 budget by slashing subsidies for fossil fuels such as oil, gas and coal.

The budget would also provide $853 million to support new nuclear energy technologies, such as small modular reactors.

To help pay for the clean energy initiatives, the White House is asking Congress to repeal $3.6 billion in oil, natural gas and coal subsidies, a move that would total $46.2 billion over a decade.

But many Republicans oppose cutting subsidies for fossil fuels, saying it would hurt industries that provide jobs while the economy is still fragile.

http://www.reuters.com/article/2011/02/14/us-usa-budget-energy-idUSTRE71D3V420110214

[nismaratwork]

Ooh, some action on renewables and subsidies from that nice Mr Obama....

If he gets that through, I can take a little Good Old Party 'sticking it to the poor'. No offense R's, but each party has its "thing". Democrats want to save the unsalvageable, and Republicans want Darwin, Reagan, and Goldwater genetically merged into an Uber-president.

Both are frankly laughable to me, but that is my view only. I think this is clever... democrats will vocally oppose the president on cuts for "aid", the republicans will be complaining that... we don't subsidize coal. That is not the kind of situation you want to be in as a politician.

[apeiron]

If he gets that through, I can take a little Good Old Party 'sticking it to the poor'.

He has failed a few times already, apparently. So nice to see he is sticking at it.

And it is of course a global issue, though for a different reason in oil-producing nations with a large poor population to keep placated.

The imbalance between subsidies for fossil fuels and those for renewables is an issue faced by countries around the world. In a recent report, Bloomberg New Energy Finance calculated global fossil fuel subsidies at $557 billion, compared to $46 billion for renewable energy. In 2009, the G-20 nations pledged a reduction in their domestic fossil fuel subsidies, but little action has followed.

http://leadenergy.org/2011/02/cutting-fossil-fuel-subsidies-third-times-the-charm/

[nismaratwork]

He has failed a few times already, apparently. So nice to see he is sticking at it.

And it is of course a global issue, though for a different reason in oil-producing nations with a large poor population to keep placated.

Agreed... and damn that is one depressing article.

[mugaliens]

Ooh, some action on renewables and subsidies from that nice Mr Obama....

Oh. So that's where he's planning to spend his originally rejected, though now resurrected, tax increases (http://news.yahoo.com/s/ap/20110214/ap_on_re_us/us_obama_taxes):

"Obama's proposal would extend tax credits for college expenses and expand them for child care. A more generous Earned Income Tax Credit for families with three or more children would be made permanent.

The plan would enhance and make permanent a popular business tax credit for research and development, and would provide tax breaks for investing in manufacturing and for making commercial buildings more energy efficient."

It's a little early for him to start campaigning for a 2012 run, isn't it?

[Al68]

I've seen estimates ranging between 80 years and 500 years.For all practical purposes, relatively cheap uranium supply is unlimited. Most sources are just not used because uranium is so plentiful and cheap to obtain from open-mining. Even seawater (http://en.wikipedia.org/wiki/Uranium_mining#Recovery_from_seawater) contains 3.3 mg/m^3 uranium. Very low uranium prices prevent that from being cost effective ($240-300/kg) using current methods, and very little research has been done to evaluate better ways to concentrate it for the same reason. And that virtually unlimited supply is but a fraction of the total, and I only mention it to make the point: we live on a very uranium-rich planet.

Again, the cost of nuclear power is driven by construction and operating costs, which are driven by safety and national security concerns. The amount of uranium easily and cheaply obtainable is orders of magnitude greater than we could ever use to meet any foreseeable demand. Like I said before, if we ever improved nuclear technology to the point where uranium supply drove the cost, household electricity would be too cheap to meter.

[Al68]

.....and Republicans want Darwin, Reagan, and Goldwater genetically merged into an Uber-president.Nah, just Goldwater would do very nicely. :biggrin:

[apeiron]

The amount of uranium easily and cheaply obtainable is orders of magnitude greater than we could ever use to meet any foreseeable demand.

What is your source for this claim? Do you have some peer-reviewed reference you can supply?

[Al68]

What is your source for this claim? Do you have some peer-reviewed reference you can supply?Well, that's more of a gross understatement than a claim IMO, but no, I don't have a peer-reviewed reference. I gave my more than adequate source in that post: http://en.wikipedia.org/wiki/Uranium_mining.

The only reason all those other sources of uranium aren't used is because it's too cheap now to open-mine to even bother with other sources. Even concentrating uranium from seawater is fairly cheap, and if you do the math at 3.3 mg/m^3, I think you will agree that plentiful is an understatement. And we haven't even bothered with R&D to make that much cheaper because it's so plentiful from other sources.

Edit: Here's a paper in the American Journal of Physics (http://sustainablenuclear.org/PADs/pad11983cohen.pdf) that says uranium from seawater, using fast breeder reactors, would economically last at least 5 billion years. My claim was apparently far too modest. :smile:

[apeiron]

Even concentrating uranium from seawater is fairly cheap, and if you do the math at 3.3 mg/m^3, I think you will agree that plentiful is an understatement.

Given that the recovery process has only been demonstrated at the experimental level and the scaling up to commercial production is untested, I would say you could be risking overstatement.

It is like getting x60 more out of uranium with fast breeders. Or shifting to thorium. The ideas are attractive, but still to be proven in practice.

This does not mean I think the prospects aren't good, just that everything needs to be kept in perspective and judged on the best evidence available.

This could be one such summary (which does argue uranium supply is not an issue in any immediate sense)...

http://www.worldenergy.org/publications/survey_of_energy_resources_2007/uranium/673.asp

[Al68]

Given that the recovery process has only been demonstrated at the experimental level and the scaling up to commercial production is untested, I would say you could be risking overstatement.Nope, still huge understatement. The $240-300/kg "experimental" cost should get much cheaper if scaled up, it certainly wouldn't get more expensive. Common sense says potentially much, much cheaper, but that's just speculation.

But even that number is reasonably cheap by fossil fuel standards, it's just not economical compared to other, cheaper uranium sources.It is like getting x60 more out of uranium with fast breeders.OK, what's 5 billion years divided by 60 (or 100?)? We are obviously not going to run out of atoms to split in the foreseeable future, regardless of the details.

[mheslep]

Ooh, some action on renewables and subsidies from that nice Mr Obama....
To help pay for the clean energy initiatives, the White House is asking Congress to repeal $3.6 billion in oil, natural gas and coal subsidies, a move that would total $46.2 billion over a decade.
Thanks for this. Repeal of fossile subsidies is well overdue. I hope these cuts pass. I do have one reservation, in that there's a game the government has played with industry over the years: with one hand the government bashes the energy industry over the head by encouraging or allowing frivolous law suits and regulation, and then when recognizing the same industry is responsible for jobs and critically needed energy, the same government hands out subsidies with the other hand. The point is that when the subsidies go, and they should, attention should by paid to industry harassment as well.

But many Republicans oppose cutting subsidies for fossil fuels, saying it would hurt industries that provide jobs while the economy is still fragile.Really? Many, unnamed Republicans, in this Reuters article.

[nismaratwork]

Thanks for this. Repeal of fossile subsidies is well overdue. I hope these cuts pass. I do have one reservation, in that there's a game the government has played with industry over the years: with one hand the government bashes the energy industry over the head by encouraging or allowing frivolous law suits and regulation, and then when recognizing the same industry is responsible for jobs and critically needed energy, the same government hands out subsidies with the other hand. The point is that when the subsidies go, and they should, attention should by paid to industry harassment as well.

Really? Many, unnamed Republicans, in this Reuters article.

Are you making an argument for fairness in government and business, and then beyond that, is a Reuters no longer a valid source for P&WA? If "unnamed R/D/I, official, aide" is no longer valid from a generally trusted source, there's going to be very little to talk about.

I agree with the cuts, but which frivolous lawsuits do you mean... there are are lot lawsuits past and present in that arena, and not all are frivolous. It would probably help to know which you consider to be, and which you believe are valid, if any.

Other than a sense of wounded feelings, which I think the energy industry can handle, I'm not hearing any material damages put forth. Profits... plenty of those, but not a lot of damages.

[mheslep]

A PF valid news source is basis for argument. That doesn't mean the source is beyond question or somehow infallible.

[nismaratwork]

A PF valid news source is basis for argument. That doesn't mean the source is beyond question or somehow infallible.

Fair enough, so what was your point in the "unnamed republicans"? That's pretty much standard fare from a wire source and this kind of information. Asking for a better source, sure, but Reuters is what it is.

I'd add, if it's basis for an argument, maybe you'd be better served by addressing its content, or challenging its veracity outright, not side-stepping it.

[mheslep]

Fair enough, so what was your point in the "unnamed republicans"? Just what I said. The article did not name any Republicans, nor even use an unnamed source. Your bit about unnamed "aids" above is imaginary; there's no source what so ever in that article claiming any kind of direct knowledge of lawmakers minds. The author just asserts.

Back to the topic ... peak fossil fuels.

[nismaratwork]

Just what I said. The article did not name any Republicans, nor even use an unnamed source. Your bit about unnamed "aids" above is imaginary; there's no source what so ever in that article claiming any kind of direct knowledge of lawmakers minds. The author just asserts.

Back to the topic ... peak fossil fuels.

To be clear, the bit about aides was not related to THIS, but a generalization. Besides, isn't this how politics is conducted through the media in general?

So... DO Republicans support cuts to fossil fuel subsidies, because if so, I can understand why you'd be so annoyed at a Reuters line. If it's just an illustration of a well understood and long-held position on the other hand, I think that would just be rhetorical and not entirely forthright. Still, as you say, peak fossil fuels:

Given the power of fossil fuel lobbies in congress, is it realistic to believe that we'll be more successful in reducing them than with farming subsidies?

[apeiron]

Regardless of which politicians say what, the economic logic of oil pricing (and so subsidies among other market manipulations like ME airbases and support for despotic rulers) is clear enough.

Richard Heinberg is writing a book with a nice explanation.
http://postcarbon.us1.list-manage1.com/track/click?u=311db31977054c5ef58219392&id=4e04de2333&e=00411b992d


as the new decade wore on, the price of oil soared relentlessly, reaching levels far higher than the “pessimistic” $30 range. Demand for the resource was growing, especially in China and some oil exporting nations like Saudi Arabia; meanwhile, beginning in 2005, actual world oil production hit a plateau. Seeing a perfect opportunity (a necessary commodity with stagnating supply and growing demand), speculators drove the price up even further.

As prices lofted, oil companies and private investors started funding expensive projects to explore for oil in remote and barely accessible places, or to make synthetic liquid fuels out of lower-grade carbon materials like bitumen, coal, or kerogen.

But then in 2008, just as the price of a barrel of oil reached its all-time high of $147, the economies of the OECD countries crashed. Airlines and trucking companies downsized and motorists stayed home. Demand for oil plummeted. So did oil’s price, bottoming out at $32 at the end of 2008.

But with prices this low, investments in hard-to-find oil and hard-to-make substitutes began to look tenuous, so tens of billions of dollars’ worth of new energy projects were canceled or delayed. Yet the industry had been counting on those projects to maintain a steady stream of liquid fuels a few years out, so worries about a future supply crunch began to make headlines.[29]

It is the financial returns on their activities that motivate oil companies to make the major investments necessary to find and produce oil. There is a long time lag between investment and return, and so price stability is a necessary condition for further investment.

Here was a conundrum: low prices killed future supply, while high prices killed immediate demand. Only if oil’s price stayed reliably within a narrow—and narrowing—“Goldilocks” band could serious problems be avoided. Prices had to stay not too high, not too low—just right—in order to avert economic mayhem.

So the question is how laisser faire economic policies can fix these kinds of systemic problems? Market behaviour gets locked into a fixed point attractor until at some stage the buffers are hit. A market unable to correct itself gets "corrected" in much the same way as a drunk driver on a windy road.

Cornucopians claim that technology and substitution always gallop to the rescue of markets. This is why free markets work. But what is the model for a market locked into a state by larger forces? Where is the theory that would introduce rationality to longterm behaviour in such a market.

Industry subsidies would be one of the symptoms of the actual "market forces" at work. Along with a resistance to fuel taxes. And military budgets, etc.

Removing fossil fuel subsidies is of course a good idea both if you are a peak oiler, or simply a free market purist. But if the diagnosis is correct - there are tight constraints on the free functioning of the fossil fuel market, it is in almost everyone's near term interests to manipulate the market - then any action that causes a price rise will find itself by some other action to force it back down.

And consequently there will be no money going into the development of substitutes (nuclear for instance) and little voluntary efficiency measures.

Perhaps someone can find a cornucopian modelling of this situation. Maybe it can be argued that what we should expect is a chaotic phase followed by a swift transition to some new economic attractor. We will be in for a rough few decades, a time when a succession of crashes results eventually in that new mix of efficiency and new "cheap" fuel sources, but then sail out the other side with an economy that prices in its fuel at a different long-run level.

Where are these optimistic, but realistic, cornucopian models when you need them?

[nismaratwork]

Regardless of which politicians say what, the economic logic of oil pricing (and so subsidies among other market manipulations like ME airbases and support for despotic rulers) is clear enough.

Richard Heinberg is writing a book with a nice explanation.
http://postcarbon.us1.list-manage1.com/track/click?u=311db31977054c5ef58219392&id=4e04de2333&e=00411b992d



So the question is how laisser faire economic policies can fix these kinds of systemic problems? Market behaviour gets locked into a fixed point attractor until at some stage the buffers are hit. A market unable to correct itself gets "corrected" in much the same way as a drunk driver on a windy road.

Cornucopians claim that technology and substitution always gallop to the rescue of markets. This is why free markets work. But what is the model for a market locked into a state by larger forces? Where is the theory that would introduce rationality to longterm behaviour in such a market.

Industry subsidies would be one of the symptoms of the actual "market forces" at work. Along with a resistance to fuel taxes. And military budgets, etc.

Removing fossil fuel subsidies is of course a good idea both if you are a peak oiler, or simply a free market purist. But if the diagnosis is correct - there are tight constraints on the free functioning of the fossil fuel market, it is in almost everyone's near term interests to manipulate the market - then any action that causes a price rise will find itself by some other action to force it back down.

And consequently there will be no money going into the development of substitutes (nuclear for instance) and little voluntary efficiency measures.

Perhaps someone can find a cornucopian modelling of this situation. Maybe it can be argued that what we should expect is a chaotic phase followed by a swift transition to some new economic attractor. We will be in for a rough few decades, a time when a succession of crashes results eventually in that new mix of efficiency and new "cheap" fuel sources, but then sail out the other side with an economy that prices in its fuel at a different long-run level.

Where are these optimistic, but realistic, cornucopian models when you need them?

re bolding mine: Oh, they would be in the circular file with Cold Fusion, Anything with the word "Over-unity" in it, a signed photograph of Ronald Reagan giving a thumbs up in a cowboy hat, and Everything Tesla said after he lost his marbles.

It seems to me that the faux-Libertarian model is just what you said... let the poor bastards (most of us) slam into a jersey barrier at speed... that'll teach 'em! The fact that a cleanup effort, towing the wreck, unintended victims, you know... Blowback... has that ever been an issue in, "Die Beste aller möglichen Welten?" Not that I can see, although that's one hell of a way to resolve the cognitive dissonance of actively participating in your own destruction.

I'm curious though, to me, your case is very convincing... BUT... what's the solution?

[Al68]

Fair enough, so what was your point in the "unnamed republicans"? That's pretty much standard fare from a wire source and this kind of information.Standard fare, yes, but that assertion in the Reuters piece provided absolutely no information regarding the position of any politician, yet pretended to do so. It would rise to the level of hearsay if it provided a name and quote. Another issue is that the position of the "unnamed" politician is paraphrased, which may or may not accurately portray the actual position even if a name was provided.....Besides, isn't this how politics is conducted through the media in general?...Yes, for decades. That's how people are mislead and manipulated by media sources. That piece may or may not itself be misleading, but has no legitimate value for the purpose of determining any politician's position on the issue.

[nismaratwork]

Standard fare, yes, but that assertion in the Reuters piece provided absolutely no information regarding the position of any politician, yet pretended to do so. It would rise to the level of hearsay if it provided a name and quote. Another issue is that the position of the "unnamed" politician is paraphrased, which may or may not accurately portray the actual position even if a name was provided.Yes, for decades. That's how people are mislead and manipulated by media sources. That piece may or may not itself be misleading, but has no legitimate value for the purpose of determining any politician's position on the issue.

I agree with that, but given that it's hardly a controversial or new position (see apeiron's post), I was a little taken-aback that mheslep felt that the content wasn't worth addressing, only the source.

[apeiron]

I'm curious though, to me, your case is very convincing... BUT... what's the solution?

My solution was to move me and my family to New Zealand :wink:.

The optimistic view among peak oilers is to point out that energy descent may mean going without a lot of consumer junk, a lot of life choices, but on the other hand, it could be psychologically healthier (physically too as we get back to working the land, cycling everywhere).

So the solution - as advocated by the transistion town movement - is get to know your neighbours, learn to grow, invest in quality tools, plant fruit and nut trees. Build resilience and know-how.

[nismaratwork]

My solution was to move me and my family to New Zealand :wink:.

The optimistic view among peak oilers is to point out that energy descent may mean going without a lot of consumer junk, a lot of life choices, but on the other hand, it could be psychologically healthier (physically too as we get back to working the land, cycling everywhere).

So the solution - as advocated by the transistion town movement - is get to know your neighbours, learn to grow, invest in quality tools, plant fruit and nut trees. Build resilience and know-how.

:rofl: Yeah, I seriously considered moving once or twice myself. Good for you, and good for your family. Beyond that, it sounds like my view, but with the addition that you hope to survive, and I expect doom. I like your viewpoint more, but then, you have a family to care for and presumably age and experience on me. I hope I can settle on a view before I simply become misanthropic, because given your knowlege-base and conclusions, I'd be pretty terrified.

[apeiron]

I hope I can settle on a view before I simply become misanthropic, because given your knowlege-base and conclusions, I'd be pretty terrified.

On a personal level, what's the worst that can happen except that you will get to witness even more history being made?

Being alive at this precise moment in human history must be winning the ultimate jackpot. You get to see "what happened" to a species, as well as enjoy the likely highspot for understanding the reality within which this species arose. You just have to invent a life that maximises the opportunity presented.

For the kids though, it could be a bit of a bugger :tongue2:.

[nismaratwork]

On a personal level, what's the worst that can happen except that you will get to witness even more history being made?

That sounds pretty either really good, or like a curse! Still, I take your meaning.

Being alive at this precise moment in human history must be winning the ultimate jackpot. You get to see "what happened" to a species, as well as enjoy the likely highspot for understanding the reality within which this species arose. You just have to invent a life that maximises the opportunity presented.

For the kids though, it could be a bit of a bugger :tongue2:.

Well, I enjoy the lack of lice and other parasites, and sewerage and lamps are really fantastic. This "series of tubes" we're using right now isn't half bad either... then again, it deepens on what you want from a jackpot. It might have been a more peaceful life before it was conceivable that we might be in the process of systematically drowning in our own waste and stupidity. I think I can hear Voltaire laughing... :wink:

[apeiron]

The latest on what the oil companies are saying....

http://www-static.shell.com/static/aboutshell/downloads/aboutshell/signals_signposts.pdf

Shell says we need to be worried as we are about to enter the zone of extraordinary misery/opportunity.

Shell does not dwell on the reasons why the oil won't be there, but focuses on the geopolitical stress to be expected from developing nations expecting their fair share of the global economic cake.


Underlying global demand for energy by 2050 could triple from its 2000 level if
emerging economies follow historical patterns of development.
In broad-brush terms, natural innovation and competition could spur improvements
in energy efficiency to moderate underlying demand by about 20% over this
time. Ordinary rates of supply growth -- taking into account technological,
geological, competitive, financial and political realities -- could naturally boost
energy production by about 50%. But this still leaves a gap between businessas-
usual supply and business-as-usual demand of around 400 EJ/a – the size of
the whole industry in 2000.
This gap – this Zone of Uncertainty – will have to be bridged by some combination of
extraordinary demand moderation and extraordinary production acceleration.


So even with optimistic efficiency measures and optimistic supply growth, there is still a huge gap to be filled (or expect a very unhappy world with a demographics that pits the young, angry and populous against the old, weary and nervous).

[nismaratwork]

How very enlightened of them... :grumpy:

[Greg Bernhardt]

"The world can be powered by alternative energy, using today's technology, in 20-40 years, says Stanford researcher Mark Z. Jacobson"

http://news.stanford.edu/news/2011/january/jacobson-world-energy-012611.html

[nismaratwork]

"The world can be powered by alternative energy, using today's technology, in 20-40 years, says Stanford researcher Mark Z. Jacobson"

http://news.stanford.edu/news/2011/january/jacobson-world-energy-012611.html

But converting will be a massive undertaking on the scale of the moon landings. What is needed most is the societal and political will to make it happen.

There is no political will, no corporate motivation as a stake in any one nation is no longer necessary in the long-run. As a society, I can't even imagine it until it's far too late... can you?

I think that's why we need a bridge: Nuclear, and even then I have my doubts.

[mheslep]

"The world can be powered by alternative energy, using today's technology, in 20-40 years, says Stanford researcher Mark Z. Jacobson"

http://news.stanford.edu/news/2011/january/jacobson-world-energy-012611.htmlI don't see a cost total this time. When Jacobson came out with this proposal in 2009, his cost was $100 trillion worldwide over twenty years. For even just the US portion of such a plan, the cost is far more than the Apollo program with which he wants to compare.
2009 Version:
http://www.scientificamerican.com/article.cfm?id=a-path-to-sustainable-energy-by-2030&print=true
http://news.stanford.edu/news/2009/october19/jacobson-energy-study-102009.html
http://www.physicsforums.com/showpost.php?p=2543785&postcount=84

I believe Jacobson's view is coming inevitably, but in a different timescale than he imagines, say 2070, not his 2030, and for a lot less money (constant dollars).

[mheslep]

Regardless of which politicians say what, the economic logic of oil pricing (and so subsidies among other market manipulations like ME airbases and support for despotic rulers) is clear enough.

Richard Heinberg is writing a book with a nice explanation.
http://postcarbon.us1.list-manage1.com/track/click?u=311db31977054c5ef58219392&id=4e04de2333&e=00411b992d

Here's another Heinberg appearance: a 911 Truther petition
We Want Real Answers About 9/11
http://www.911truth.org/article.php?story=20041026093059633
See #45.

[apeiron]

Here's another Heinberg appearance: a 911 Truther petition
We Want Real Answers About 9/11
http://www.911truth.org/article.php?story=20041026093059633
See #45.

Attacking the man rather than the argument again, hey?

[nismaratwork]

Attacking the man rather than the argument again, hey?

When there's nothing left... ad hominem. Another variation would be, "those who can't, ad hominem."

[nismaratwork]

I don't see a cost total this time. When Jacobson came out with this proposal in 2009, his cost was $100 trillion worldwide over twenty years. For even just the US portion of such a plan, the cost is far more than the Apollo program with which he wants to compare.
2009 Version:
http://www.scientificamerican.com/article.cfm?id=a-path-to-sustainable-energy-by-2030&print=true
http://news.stanford.edu/news/2009/october19/jacobson-energy-study-102009.html
http://www.physicsforums.com/showpost.php?p=2543785&postcount=84

I believe Jacobson's view is coming inevitably, but in a different timescale than he imagines, say 2070, not his 2030, and for a lot less money (constant dollars).

Basically, you believe anything that doesn't have this crisis occuring during your lifetime. That is indeed one very profound way to resolve cognitive dissonance. On the other hand, this strikes me as a fairly radical bet for conservatives, don't you?

True, Jacobson is dreaming, but if you added nuclear to the mix and spread out the impact and transiition... oh right, you still haven't adressed that idea. I'd add, if everyone judged the content of one anohter's writing by the views we held, how many people here would listen to you at all? I don't see the point of inserting a standard you wouldn't normally apply, which is obvious given a detailed perusal of your posting history.

So... nuclear taking over for Coal, while we focus on portable fuel sources... how much would that cut the 100 trillion USD estimate? Oh, and what would be a reasonable price for the entire world to make that transition in 20 years?

[apeiron]

So... nuclear taking over for Coal, while we focus on portable fuel sources... how much would that cut the 100 trillion USD estimate? Oh, and what would be a reasonable price for the entire world to make that transition in 20 years?

On the subject of peak coal, a reminder that that wacky conspiracy theorist Heinberg has been writing articles for that notorious crank rag Nature :redface:. His rantings would never pass peer review in any serious journal, etc, etc.

http://www.energybulletin.net/stories/2010-11-18/fridley-heinberg-discuss-peak-coal-nature-journal

[Proton Soup]

Heh... probably a very long time, but then it might be a poor idea to breach a magma chamber by accident, and WOW that equipment would need to be tough. Still, I get your point, and there are other ways to exploit the geomagnetic field... just not cost effective.

If you added storage to wind, solar, and even more exotic means... efficient and reusable capacitor, then suddenly it's not insane to do this. I don't mean one house with a battery, I mean long term serious storage, and a new infrastructure to transmit it.

hey, guess what...

http://www.physorg.com/news/2011-02-magma-power-geothermal-energy.html

[nismaratwork]

hey, guess what...

http://www.physorg.com/news/2011-02-magma-power-geothermal-energy.html

Now that's more than impressive, but what leaps to mind is: you have to do all of this in a volcanically active region!

[apeiron]

How bad is it going to get with Middle East oil suppliers like Libya and Iran? First the risk of destruction and disruption of supply. Then later nationalisation and rationing if there is more democratic self-control.

Egypt, Bahrain are important too for their pipelines and shipping lanes. Moving oil is a strategic good just about as much as producing it.

[nismaratwork]

How bad is it going to get with Middle East oil suppliers like Libya and Iran? First the risk of destruction and disruption of supply. Then later nationalisation and rationing if there is more democratic self-control.

Egypt, Bahrain are important too for their pipelines and shipping lanes. Moving oil is a strategic good just about as much as producing it.

We have Israel... a base in Crete, the fifth fleet... if we have to have WWIII, this might be a good time to have it.

[apeiron]

We have Israel... a base in Crete, the fifth fleet... if we have to have WWIII, this might be a good time to have it.

How is that going to work? Wars create disruption of oil production, and disruption is precisely what the economy cannot afford. Especially if Saudi cannot crank up production to make up shortfalls, as seems to be the case.

Consider the history of these kinds of events.

Crises in Iran and Iraq

In 1979 and 1980, events in Iran and Iraq led to another round of crude oil price increases. The Iranian revolution resulted in the loss of 2 to 2.5 million barrels per day of oil production between November 1978 and June 1979. At one point production almost halted.

The Iranian revolution was the proximate cause of what would become the highest price in post-WWII history. However, its impact on prices would have been limited and of relatively short duration had it not been for subsequent events. Shortly after the revolution, production was up to 4 million barrels per day.

In September 1980, Iran already weakened by the revolution was invaded by Iraq. By November, the combined production of both countries was only a million barrels per day and 6.5 million barrels per day less than a year before. Consequently worldwide crude oil production was 10 percent lower than in 1979.

The combination of the Iranian revolution and the Iraq-Iran War cause crude oil prices to more than double increasing from $14 in 1978 to $35 per barrel in 1981.

Three decades later Iran's production is only two-thirds of the level reached under the government of Reza Pahlavi, the former Shah of Iran.

Iraq's production remains a million barrels below its peak before the Iraq-Iran War.

http://www.wtrg.com/prices.htm

[nismaratwork]

How is that going to work? Wars create disruption of oil production, and disruption is precisely what the economy cannot afford. Especially if Saudi cannot crank up production to make up shortfalls, as seems to be the case.

Consider the history of these kinds of events.

Key point, "If we have to have...", and the justification being that as chaos and disruption is already spreading...

I admit, there was also an element of death's head humor. With Libya becoming a slaughterhouse and the rest joining in... lets face it, it's raining **** and is unlikely to stop.

Then... Iran... do you believe that they'll be allowed to build a nuclear weapon? The latest worm did some damage, but the best I've heard is a year. Maybe this is the kind of change we need, which may not be the change we want.

My point: If the region has to explode, better conventional than nuclear, and better now than in 15 years when China is feeling more adventurous.

[apeiron]

My point: If the region has to explode, better conventional than nuclear, and better now than in 15 years when China is feeling more adventurous.

I was thinking that the clever approach from the US POV was to stage these things. If it takes about a decade to invade, regime change, get the oil pumping at maximum rate, then you want to take an Iran or Iraq off-line in a managed fashion. In timely fashion so it keeps the production curves smooth as far into the future as possible.

And you don't really care who runs these countries - hard men or democracies - so long as those in charge are incentivised to stay focused on maximum oil production.

Worrying about a nuclear Iran seems a bogeyman issue. What kind of arsenal could they end up with - compared to a thermonuclear Israel with multiple delivery platforms for instance?

But an Iran without the infrastructure to efficiently export all its oil in the not too distant future? That really does not bear thinking about in geopolitical circles. Whether you are US, China, or whoever is in charge by 2020.

[nismaratwork]

I was thinking that the clever approach from the US POV was to stage these things. If it takes about a decade to invade, regime change, get the oil pumping at maximum rate, then you want to take an Iran or Iraq off-line in a managed fashion. In timely fashion so it keeps the production curves smooth as far into the future as possible.

And you don't really care who runs these countries - hard men or democracies - so long as those in charge are incentivised to stay focused on maximum oil production.

Worrying about a nuclear Iran seems a bogeyman issue. What kind of arsenal could they end up with - compared to a thermonuclear Israel with multiple delivery platforms for instance?

But an Iran without the infrastructure to efficiently export all its oil in the not too distant future? That really does not bear thinking about in geopolitical circles. Whether you are US, China, or whoever is in charge by 2020.

True, but here a disaster is, and we have to consider how best to capitalize on the situation. I would say that the major issue of a nuclear Iran is two-fold:
1.) Israel is unlikely to allow that, and Iran is too unstable historically.
2.) A nuclear Iran, like NK, suddenly can turn to shoring up its power, free in the knowledge that nobody wants to start a war with a nuclear power.

To be blunt, what's coming, is coming, and we can't stop it. We can however, try to sieze key assets and hope for a cold-war a la a divided Germany.

edit: Besides, you want impetus to develop other fuels and technologies? Widespread poverty, chaos and death should be a strong impetus. Personally, I think we're getting a preview of things to come, something Kissinger knew could only be delayed.

[apeiron]

Something new to worry about :smile: - thermodynamic limits to the wind that can be sucked out of the atmosphere.

http://www.newscientist.com/article/mg21028063.300-wind-and-wave-farms-could-affect-earths-energy-balance.html?full=true&print=true

The numbers still sound dubious and better modelling will follow. But it is interesting to think of the feedback effects that could result from draining energy from normal air or tidal flows. Every action has its consequences.

[Proton Soup]

Something new to worry about :smile: - thermodynamic limits to the wind that can be sucked out of the atmosphere.

http://www.newscientist.com/article/mg21028063.300-wind-and-wave-farms-could-affect-earths-energy-balance.html?full=true&print=true

The numbers still sound dubious and better modelling will follow. But it is interesting to think of the feedback effects that could result from draining energy from normal air or tidal flows. Every action has its consequences.

New Scientist has always been horrible. sure, removing energy from the wind and moving it somewhere else will change the ecosystem. so does removing energy from rivers. then they want to make the point that the sun is the ideal source (in the linked article from that page). but the variation in solar energy creates wind, too.

That's because solar radiation - ultimately our only truly renewable energy source - produces usable energy in only two ways. First by heating different parts of the Earth to different degrees, and so driving vast flows of wind and water, and second by being absorbed by biological organisms - or, nowadays, by solar cells. (http://www.newscientist.com/article/mg21028062.500-the-sun-is-our-only-truly-renewable-energy-source.html)

oh noes! moving solar energy to a different location will change weather patterns, too!

[apeiron]

New Scientist has always been horrible.

Hey, I used to write for them! (But I did stop largely because they really did become tabloid sensationalist.)

sure, removing energy from the wind and moving it somewhere else will change the ecosystem. so does removing energy from rivers.

Yes, too true. The hydro dam revolution is now running into problems 30 or 40 years down the road because dams silt up and become unusable. They also do so much damage to ecology of river mouths that there are big costs to fisheries and biodiversity that have to be factored into the financial equation.

Again, every action has consequences and we haven't been putting enough effort into the science of modelling that.

We can make the machines, but are less good at modelling the world in which they then exist.

[mheslep]

Anyone see the fine 2007 Daniel Day-Lewis film There Will Be Blood (http://www.imdb.com/title/tt0469494/), about the early days of Texas oil wildcatting? Now from Daniel Yergin (http://www.ihs.com/capabilities/experts/Daniel-Yergin.aspx), author of the Pulitzer winning history of the oil business, The Prize (http://www.amazon.com/Prize-Epic-Quest-Money-Power/dp/0671799320), comes an essay:

There Will Be Oil (http://online.wsj.com/article/SB10001424053111904060604576572552998674340.html)

...This is actually the fifth time in modern history that we've seen widespread fear that the world was running out of oil. The first was in the 1880s, when production was concentrated in Pennsylvania and it was said that no oil would be found west of the Mississippi. Then oil was found in Texas and Oklahoma. Similar fears emerged after the two world wars. And in the 1970s, it was said that the world was going to fall off the "oil mountain." But since 1978, world oil output has increased by 30%...

Yergin has a sequel out on energy titled The Quest (http://online.wsj.com/article/SB10001424053111904265504576569020549199248.html?K EYWORDS=DANIEL+YERGIN), so expect more public visibility soon from him such as this essay.

[CAC1001]

I would disagree with him in his claim about technologies like wind power broadening our energy base. Otherwise, I hope he is correct. In the comments section, there are some people really tearing him up though.

[mheslep]

I would disagree with him in his claim about technologies like wind power broadening our energy base. Otherwise, I hope he is correct. In the comments section, there are some people really tearing him up though.Which comments? Hayward's review of Quest, or Yergin's There Will Be Oil?

[CAC1001]

Which comments? Hayward's review of Quest, or Yergin's There Will Be Oil?

Yergin's There Will Be Oil.

[DoggerDan]

There Will Be Oil (http://online.wsj.com/article/SB10001424053111904060604576572552998674340.html)

The definitive difference, of course, is that the previous scares were based on not knowing the other reserves existed (a thing of the 1880s past) or not having the technology to get to it. Modern technology can get to only so much, and that's really not much at all. The rest is just way out of reach.

Unless we invent transporter technology, but by then our need of oil will also be a thing of the past.

No. There will not "always be oil."

[CAC1001]

The definitive difference, of course, is that the previous scares were based on not knowing the other reserves existed (a thing of the 1880s past) or not having the technology to get to it. Modern technology can get to only so much, and that's really not much at all. The rest is just way out of reach.

Unless we invent transporter technology, but by then our need of oil will also be a thing of the past.

No. There will not "always be oil."

Well it depends on economics and technological innovation. Everyone knows that oil is in a finite supply, but if technological advancements occur that reduce the amount of oil required, then that can lengthen out the existing supply.

[mheslep]

The definitive difference, of course, is that the previous scares were based on not knowing the other reserves existed (a thing of the 1880s past) or not having the technology to get to it.
That is the similarity, not the difference. There always have been reserves, somewhere, that are unknown; this is also the case now.


No. There will not "always be oil."Of course there will be oil in the ground, for millennia, somewhere. It is likely that oil won't always be useful compared to other sources of energy, or the price of obtaining oil will be to high, or the cost to the environment of obtaining oil and using it will be to high, etc.

[DoggerDan]

That is the similarity, not the difference. There always have been reserves, somewhere, that are unknown; this is also the case now.

No, that's the difference. In 1880, Pennsylvanians thought they'd hit a localized gold mine of oil, but were largely unaware of reserves elsewhere. The difference is that today, we know where the reserves are located.

I don't think you're using the term "reserves" correctly: "The total estimated amount of oil in an oil reservoir, including both producible and non-producible oil, is called oil in place. However, because of reservoir characteristics and limitations in petroleum extraction technologies, only a fraction of this oil can be brought to the surface, and it is only this producible fraction that is considered to be reserves." http://en.wikipedia.org/wiki/Oil_reserves

As technology improves, we will have greater access to what's currently in the "oil in place" folder. When that happens, that oil will be moved from that folder to the "oil reserves" folder.

The problem remains that we know about far more oil than we're able to tap given both current and foreseen technology. Hence my comment about developing a Star Trek like transporter to get it from there to here.

Of course there will be oil in the ground, for millennia, somewhere. It is likely that oil won't always be useful compared to other sources of energy, or the price of obtaining oil will be to high, or the cost to the environment of obtaining oil and using it will be to high, etc.

Right now it's both a cost and a technology problem. In the 1950s, we simply could NOT get to the Moon. That required technological refinements which cost buku bucks. Even today, however, cost remains a massive barrier, as it will with most of the oil in place.

[mheslep]

No, that's the difference. In 1880, Pennsylvanians thought they'd hit a localized gold mine of oil, but were largely unaware of reserves elsewhere. The difference is that today, we know where the reserves are located.

...:confused: Until 2007, nobody had any idea there might be 1.8B bbls off the coast of Guiana, as the geology was not visible to typical inspection. (http://www.bloomberg.com/news/2011-09-09/tullow-oil-makes-oil-discovery-offshore-french-guiana.html)

Geologists believe that when the Atlantic Ocean started opening between South America and Africa, organic sediment resulted in hydrocarbon deposits known as the Late Cretaceous turbidite sands. They haven’t been drilled to date because they are less visible than other types of deposits and drilling at such depths has only recently become viable.


Until a couple years ago, nobody expected large amounts of oil off Brazil. Until last year, nobody thought there was any oil in Israeli med. waters. Until several years ago, nobody though natural gas locked in shale was economically retrievable. On and on.

[DoggerDan]

The message you have entered is too short. Please lengthen your message to at least 4 characters.

Really? Look below:

:confused: Until 2007, nobody had any idea there might be 1.8B bbls off the coast of Guiana, as the geology was not visible to typical inspection. (http://www.bloomberg.com/news/2011-09-09/tullow-oil-makes-oil-discovery-offshore-french-guiana.html)

Putting that into perspective, there are 1,324x10^9 bbl in all reserves. Compare that to the "find" of Guiana. Be careful to ensure you match the decimal places, and you'll find Guiana is but a drop in a billion-drop bucket.

Which brings back my point: Why is it the media is so easily duped when it comes to basic scientific concepts?

Despicable! And grossely wastefuly of US taxpayer resources.

....
...
omically retrievable. On and on.

[Chi Meson]

"1.8 billion" sounds like a lot until you realize that the US burns 20 million of them a day.

So Guyana gives our oil dependency another 3 months of life.

[mheslep]

Another example showing knowledge of reserves then, knowledge of reserves now:
OPEC 1980 (410B bbls), OPEC 2009 (1137B bbls)
http://en.wikipedia.org/wiki/File:OPEC_declared_reserves_1980-now_BP.svg
Nobody today knows where the all the future oil is either, but the trend for the moment is up.

[edpell]

The amount of oil that can be extracted depends on how much you are willing to pay for a barrel. At $20 per barrel the remaining amount is small. At $300 per barrel there is a lot of oil still remaining. How many buyer are there are $300 per barrel? ($10 per gallon for gas or home heating) The biggest know reserve is the Orrinoco tar sands in Venezuela at 600 billion barrels, 20 years world supply. Second Canadian tar sands at 300 billion barrels, 10 years world supply.

[DoggerDan]

Another example showing knowledge of reserves then, knowledge of reserves now:
OPEC 1980 (410B bbls), OPEC 2009 (1137B bbls)
http://en.wikipedia.org/wiki/File:OPEC_declared_reserves_1980-now_BP.svg
Nobody today knows where the all the future oil is either, but the trend for the moment is up.

You are again confusing the difference between "reserves" and "oil in place." Reserves refers to only the portion of the oil in place which we have the current knowledge technology to extract. Thus, you could have 1T bbls of oil in place, half of which is recoverable i.e. reserves. If you invent a way to get out another 200B bbls, your reserves increase to 700B bbls, all without finding a single additional drop of oil.

"The total estimated amount of oil in an oil reservoir, including both producible and non-producible oil, is called oil in place. However, because of reservoir characteristics and limitations in petroleum extraction technologies, only a fraction of this oil can be brought to the surface, and it is only this producible fraction that is considered to be reserves." From: http://en.wikipedia.org/wiki/Oil_reserves


The amount of oil that can be extracted depends on how much you are willing to pay for a barrel.

It depends on two things, actually. The first is technology. If you don't have the technology to get to it, you can pay all the money in the world and you will still be unable to get to it.

If you can get to it, then recovery price comes into play.

[mheslep]

You are again confusing the difference between "reserves" and "oil in place." Reserves refers to only the portion of the oil in place which we have the current knowledge technology to extract. Thus, you could have 1T bbls of oil in place, half of which is recoverable i.e. reserves. If you invent a way to get out another 200B bbls, your reserves increase to 700B bbls, all without finding a single additional drop of oil....The graph (http://en.wikipedia.org/wiki/File:OPEC_declared_reserves_1980-now_BP.svg)is clear; it refers only to reserves: OPEC 1980, 410B bbls; OPEC 2009, 1137B bbls, almost tripling in that time. That much is empirical fact. No doubt part of that increase is due to the inevitable improvements in removal technology, and part is due simply to additional discoveries.

[DoggerDan]

The graph (http://en.wikipedia.org/wiki/File:OPEC_declared_reserves_1980-now_BP.svg)is clear; it refers only to reserves: OPEC 1980, 410B bbls; OPEC 2009, 1137B bbls, almost tripling in that time. That much is empirical fact. No doubt part of that increase is due to the inevitable improvements in removal technology, and part is due simply to additional discoveries.

Now you're steaming on a few more boilers. :) <--- am I dating myself? All the jumps are due to locating new reserves. The very slight upwards slope of the lines is due to incremental improvements in technology. The problem is, most new finds are beyond the ability of our technology to extract them, so they add to oil in place, but not reserves. Exceptions in your graph are noted.

To be honest, I don't think removal technology will increase all that much. We had a devil of a time trying to cap the BP leak at Macondo. The fact we can establish a well-head in a mile of water still amazes me, given all the issues involved in just a couple hundred feet of water.

My point is that technology is much more of a factor than cost, but there haven't been quantum improvements in technology in decades. Only incremental ones. Thus, the only reason we haven't pumped more has been cost, as no company will pump the costly oil if they can pump the easy oil.

Without radical technological advances, we can't get to it. Injection of water, natural gas, steam, surfactants, and CO2, the use of submersible pumps, which cover primary (5-15%), secondary (35-45%), and tertiary (40-65%) recovery methods aren't radical, and they've been used for decades. Until you mine the oil-laden rock itself, the rest of the oil is unrecoverable. There it sits. This is why I made that comment about Star Trek transporter technology, because we sure as heck can't start digging mines under a mile of ocean.

Oh, well, if we had Star Trek force fields we could...

No, I'm afraid even the most radical advances in foreseeable technology over the next 100 years will only allow us to get a few more percent out of the mix.

By the way - you like graphs? Here are some interesting ones: http://www.cnn.com/SPECIALS/2010/gulf.coast.oil.spill/interactive/numbers.interactive/index.html

[mheslep]

...
To be honest, I don't think removal technology will increase all that much...
Well put your money on the table then. :tongue: People keep betting against the trend and keep losing.
http://www.nytimes.com/2010/12/28/science/28tierney.html?adxnnl=1&adxnnlx=1317073238-sZfLE7biv6f3wU4wF1/PIQ


The fact we can establish a well-head in a mile of water still amazes me, given all the issues involved in just a couple hundred feet of water...That's a common line but it seems myopic to me. Day after day 300 ton aircraft constructed w/ literally millions of parts travel seven miles up in -50C temperatures at 600 miles per hour. Dams hold back cubic miles of water. Professional soccer players have heart transplants and keep playing. Nuclear aircraft carriers displacing 100,000 tons travel the seas at up to thirty knots for twenty years without refueling. This all is now taken for granted, yet come an accident and suddenly drilling a hole in the ocean floor becomes the impossibly risky task without comparison.

[DoggerDan]

Me: The fact we can establish a well-head in a mile of water still amazes me, given all the issues involved in just a couple hundred feet of water...

That's a common line but it seems myopic to me. Day after day 300 ton aircraft constructed w/ literally millions of parts travel seven miles up in -50C temperatures at 600 miles per hour. Dams hold back cubic miles of water. Professional soccer players have heart transplants and keep playing. Nuclear aircraft carriers displacing 100,000 tons travel the seas at up to thirty knots for twenty years without refueling. This all is now taken for granted, yet come an accident and suddenly drilling a hole in the ocean floor becomes the impossibly risky task without comparison.

Myopic?

When aircraft malfunction, they can usually make an emergency landing. If they can't, fatalities rarely involve people who weren't on the passenger list.

When dams burst, there's often warning signs and subsequent evacuations in advance. If not, they might wipe out a relatively (compared to the Gulf of Mexico) valley.

We've yet to loose a nuclear carrier under any circumstances.

When a mile-deep oil well in the gulf blows out, it's difficult to stop. It killed half the life in the Gulf of Mexico.

I don't think my point of view is in any way "myopic."

[mheslep]

National Petroleum Institute just released a report stating that North American oil production could be as high as 20 million barrels per day in 2035, in other words 100% of US current consumption, requiring no OPEC imports. This would be accomplished mainly by using hydraulic fracturing techniques to recover oil and expansion of production in the Canadian Oil sands.

http://i55.tinypic.com/116m2qf.gif
http://downloadcenter.connectlive.com/events/npc091511/Resource_Supply-091511.pdf

[DrClapeyron]

NGL and lease condensates are not crude oil. Crude oil reserves in the US have dropped from 39 billion barrels in 1970 to 25 billion barrels in 2009. Consequently crude oil production has been dropping just the same. The US produces something like 5.3 million barrels of crude oil per day. The rest of the "oil" or "petroleum liquids" production is from NGL (including refined gases) and lease condensates.

[mheslep]

NGL and lease condensates are not crude oil...Yes, what is the point? Industrial society does not require crude oil, it requires gasoline, Jet-A, diesel, etc that can be made from all sources shown in the figure.

[DrClapeyron]

I can say with some certainty that the most recent large reserve increases are due to higher prices. The Venezuelan and Canadian oil sands have been known for decades, unproduced due to cheap oil - until recently.

Reserves are based on price, market and technology constraints. These reserves will change (grow) as price increases, but the OIP need not increase the same and in fact will decrease if no new OIP is found.

Public interest has changed from peak crude oil to peak fossil fuels. This clearly shows that both of these reserves are depleting and peaking at rates which affect everyone. It is no longer the price today people are concerned with but the price 10-20 years from now.

NGL and lease condensates are natural gas production byproducts. Texas' (my home state) last great oil play is in fact an unconventional shale gas play which produces lease condensates (oil) around Gonzales. The Eagle Ford resource is something like 22 trillion cubic feet. By comparison the Marcellus resource is something like 440 trillion cubic feet. Recently the USGS published a study stating they believe the Marcellus resource to be 80% less than 440 trillion cubic feet.

Considerably bigger than the Eagle Ford the Marcellus however does not have an oil window (condensates) like the Eagle Ford, and likely won't produce the same volume of NGL and lease condensates. Can't say much about the Bakken Shale other than it is much like the Eagle Ford because of the wet gas that is found in the formation. These gas plays, I am certain, are produced to provide natural gas to both utility and industrial natural gas power plants.

[mheslep]

I can say with some certainty that the most recent large reserve increases are due to higher prices. The Venezuelan and Canadian oil sands have been known for decades, unproduced due to cheap oil - until recently.

...

A similar opinion is held by Harold Hamm, Oklahoma-based founder and CEO of Continental Resources and pioneer of horizontal drilling, in today's WSJ Weekend Interview:

One reason for the renaissance has been OPEC's erosion of market power. "For nearly 50 years in this country nobody looked for oil here and drilling was in steady decline. Every time the domestic industry picked itself up, the Saudis would open the taps and drown us with cheap oil," he recalls. "They had unlimited production capacity, and company after company would go bust."


Today OPEC's market share is falling and no longer dictates the world price. This is huge, Mr. Hamm says. "Finally we have an opportunity to go out and explore for oil and drill without fear of price collapse."

http://online.wsj.com/article/SB10001424052970204226204576602524023932438.html?m od=WSJ_Opinion_LEADTop

[DrClapeyron]

A similar opinion is held by Harold Hamm, Oklahoma-based founder and CEO of Continental Resources and pioneer of horizontal drilling, in today's WSJ Weekend Interview:


It's not just the OPEC countries losing their edge:

Russian Oil Boom’s End Means Lower Tax That Risks Unrest: Energy

Russia’s 12-year oil boom is nearing its peak, forcing the next president to decide whether to cut taxes and revive production or use the windfall from $100 oil to boost public spending and quell mounting unrest.

As Vladimir Putin campaigns for a second stint in the Kremlin, the nation’s existing fields are losing pressure and oil companies OAO Rosneft, OAO Lukoil and TNK-BP (BP/) say production taxes give little incentive to invest. Since Putin first became president in 2000, crude output has grown 57 percent to 10 million barrels a day, surpassing Saudi Arabia and flooding the state treasury.

http://webfarm.bloomberg.com/news/2012-02-20/russian-oil-boom-s-end-means-lower-tax-that-risks-unrest-energy.html

Is peak oil now cause for social demonstrations in Russia? I heard rumors that Egypt's net oil exports had been declining fast in the couple years prior to Mumbarak's removal. Decreasing revenues hurting the state coffers?

And how about this publishing by Scientific American (Nature journal reference):

Has Petroleum Production Peaked, Ending the Era of Easy Oil?

A new analysis concludes that easily extracted oil peaked in 2005, suggesting that dirtier fossil fuels will be burned and energy prices will rise

Despite major oil finds off Brazil's coast, new fields in North Dakota and ongoing increases in the conversion of tar sands to oil in Canada, fresh supplies of petroleum are only just enough to offset the production decline from older fields. At best, the world is now living off an oil plateau—roughly 75 million barrels of oil produced each and every day—since at least 2005, according to a new comment published in Nature on January 26. (Scientific American is part of Nature Publishing Group.) That is a year earlier than estimated by the International Energy Agency—an energy cartel for oil consuming nations.

http://www.scientificamerican.com/article.cfm?id=has-peak-oil-already-happened

Maybe some hipocrasy on Bloomberg's part, publishing this after the Nature and Scientific American publications, and published before making claims about Russia's peaking oil production:

Peak Oil Scare Fades as Shale, Deepwater Wells Gush Crude

When Daniel Lacalle, in his early 20s, took a job with Spanish oil company Repsol YPF SA in 1991, friends chided him for entering a field with no future. "They all said, 'Why do you want to do that? Don't you know only 20 years of oil is left in the whole world?'" he recalls.

Two decades and four energy crises later, the U.S. Geological Survey estimates that more than 2 trillion barrels of untouched crude is still locked in the ground, enough to last more than 70 years at current rates of consumption. Technological advances enable companies to image, drill and shatter subterranean rocks with precision never dreamed of in decades past. Trillions of barrels of petroleum previously thought unreachable or nonexistent have been identified, mapped and in many cases bought and sold during the past half decade, from the boggy wastes of northern Alberta, to the arid mountain valleys of Patagonia, to Africa's Rift Valley.

"Betting against human ingenuity has been a mistake," says Lacalle, who today helps oversee $1.3 billion as a portfolio manager at Ecofin Ltd. in London. "The resource base is absolutely enormous, so much so that we will not run out of oil in my lifetime, your lifetime, our children's lifetimes or our grandchildren's lifetimes."


http://www.bloomberg.com/news/2012-02-06/peak-oil-scare-fades-as-shale-deepwater-wells-gush-crude.html

[CaptFirePanda]

Predicting when Peak Oil will occur is the greatest downfall of the the theory, imo. There are so many factors that need to be considered and forecasted that arriving at any sort of confident prediction requires a fair amount of naiveté.

The concept itself is quite sound, however, even if we assume vast amounts of untapped resources out there somewhere.

We need to consider the following factors:

1) What has been discovered and exploited to date represents the easiest to find and most accessible resources. Sometimes it was bubbling right up to surface, or leaking from the banks of rivers. Ultimately, it was right there in our own backyards and all we needed to do was sink a well down to begin production;

2) Unconventional sources are becoming a greater part of overall production as we move forward. This is because, our original methods used to recover the hydrocarbons didn't get it all (some fields can have very low recovery factors less than or equal to 5%) or because we've developed technologies that allow us find more remote or more 'nebulous' resources. The rather large numbers associated with some of these resources (especially shale gas) are misleading in that they reference what is in-place and not what is recoverable. There are about 50 kgs of gold in every square kilometre of seawater, but we aren't extracting gold from it any time soon;

3) These new methods (like enhanced oil recovery, hydraulic fracturing, SAGD, etc...) all require advances in techology which, in turn, required increased R&D on the parts of oil and gas companies. Increased R&D is a result of greater cash flows and broadened exploration brought on by price increases;

4) There new methods fundamentally require more energy to undertake. If they didn't, we would have already accessed them. If new methods aren't required and we are producing conventional sources, they are generally more remote and require greater energy to travel to and develop infrastructure for;

5) This greater amount of energy required to produce resources must be coupled by incremental increases in oil/gas prices, otherwise it would not be economic for companies to go after them. Growing demand also puts stresses on production and the only way to produce more, is to drill/discover more. This also requires incremental increases in cost.

6) At some point, the energy required to access and produce new resources will begin to conflict with the value of the energy extracted. I'm sure we could send out deeper and deeper oil rigs, or (perhaps) drill through the Antarctic ice sheet to access possible resources there, or microfracture the entire Bakken/Duvernay to produce all of the gas captured in the unforgiving shales. This, however, comes at greater and greater cost.

7) So, with the need to expend more energy to find and produce more hydrocarbons while dealing with ever increasing demand we are running into an inevitable breaking point (aka Peak Oil). When this will happen exactly, is next to impossible to predict. Will it happen in our lifetime? Maybe. Will it happen in our children's lifetimes? More likely.

The question arises: Can we change policies and regulations quickly enough to allow for the development of other energy sources to a degree that they can replace hydrocarbons? Maybe. I am pessimistic about this because we will also be faced with many other challenges in the coming decades and they will all be of very significant proportions. Assembling vast amounts of wind farms, hydroelectric dams, nuclear power plants, etc... will become increasingly more difficult if/when crude prices rise and supply dwindles. What kind of pressures will this put on the agricultural industry which relies heavily on hydrocarbons?

Even with another 50 -100 years, we're going to be challenged.

[mheslep]

4) There new methods fundamentally require more energy to undertake. If they didn't, we would have already accessed them. If new methods aren't required and we are producing conventional sources, they are generally more remote and require greater energy to travel to and develop infrastructure for;While possibly true I don't think it is fundamentally true that new(er) methods must use more energy, just because they have not been used before. There are several other possibilities. It may well be that the new(er) methods such as frac jobs are simply more expensive (for now) than traditional methods. It may be that the technology was not available. Continental's CEO Hamm, per the interview above (http://www.physicsforums.com/showpost.php?p=3533777&postcount=394), suggests the reason is that the investment in unconventional drilling in the US was too risky given the Saudis could in the past had the ability turn on the taps and bankrupt everyone with expensive rigs, and now the Saudis are maxed out (maybe).

Calculating the energy use of frac drilling of oil/gas may not be as straightforward as it seems. Most observers seem to concentrate on how much energy it takes to drill one frac well, which by itself is clearly more than a traditional vertical well. However, I've yet to see consideration of various other factors: with vertical drilling the oil/gas and narrow bores if the well missed by 10 feet that was as dry a hole as if one missed by a mile. A dry hole, and there were many, was utterly wasted drilling energy. With shale geology it appears to me the oil is almost always found given the virtually wide bore, if more difficult to extract. So dry holes may be very rare, eliminating setup and take-down, transport from here to there, etc. This is all supposition; I have not seen data to back it up.

[CaptFirePanda]

While possibly true I don't think it fundamentally true that new(er) methods must use more energy, just because they have not been used before. There are several other possibilities. It may well be that the new(er) methods such as frac jobs are simply more expensive (for now) than traditional methods. It may be that the technology was not available. Continental's CEO Hamm per the interview above suggests the reason is that the investment in unconventional drilling in the US was too risky given the Saudis could in the past had the ability turn on the taps and bankrupt everyone with expensive rigs, and now the Saudis are maxed out (maybe).

Hydraulic fracturing is more expensive now because it requires more energy. The permeability of these shales and tight plays is significantly lower than conventional pools. That cannot be altered by technology unless energy is added into the equation. We can, of course, reduce the overall amount of energy added, but it will still be more than that of conventional sources. You can't (as far as I know) transcend the basic laws of nature with current or foreseeable technology.

Like I said, new technology requires energy (in this case, it is often in the form of currency) and is only applied when and if it is economically feasible. Increased hydrocarbon prices are what makes new technologies economically feasible. Like I've mentioned previously, these increased prices may be the result of market speculation, but long term trends are the result of requiring more and more unconventional sources to meet demands.

The oil sands, for instance, were identified more than 200 years ago and they've been commercially developed for almost 100 years. They haven't become a viable source of crude until just recently, however. So, why leave a vast amount of potential fuel in the ground for so long? Well, because the economicsand technology weren't there first of all. Then, once the technology became available, the economics still weren't there. It wasn't until about 2003 that production reached levels of real significance.

Economics was the limiting factor and when the supply/demand requirements were met, the oil sands were produced. This supply/demand is driven by the fact that consumption is catching up (if not surpassing) production and this is happening because of the energy required to produce the same amounts of hydrocarbons now is greater than the energy required 20 years ago.

Calculating the energy use of frac drilling of oil/gas may not be as straightforward as it seems. Most observers seem to concentrate on how much energy it takes to drill one frac well, which by itself is clearly more than a traditional vertical well. However, I've yet to see consideration of various other factors: with vertical drilling the oil/gas and narrow bores if the well missed by 10 feet that was as dry a hole as if one missed by a mile. A dry hole, and there were many, was utterly wasted drilling energy. With shale geology it appears to me the oil is almost always found given the virtually wide bore, if more difficult to extract. So dry holes may be very rare, eliminating setup and take-down, transport from here to there, etc. This is all supposition; I have not seen data to back it up.

Actually, the size of the well bores has very little to do with recovery of the resource. With unconventional resources, horizontal drilling from well pads is the new status quo. The horizontal holes can be as long as 3500m and run as deep as a couple thousand meters. From these pads, the often drill several holes in various directions (in plan view, they would look like spiders, in a sense). The reasoning behind this is that the gas within the shales is so finely disseminated that it is being treated as a statistical play (eg. there's going to be gas in there, so the more you drill it and fracture it, the greater your chances are for production). Typically, these wells produce at very high rates initially and then drop off quickly. Thus, more pads and more horizontal wells must be drilled.

They definitely do have a much better success rate based on the simple fact that the gas is pervasive. But it isn't a simple one to one comparison (simply based on the intensity of unconventional drilling).

[mheslep]

The question arises: Can we change policies and regulations quickly enough to allow for the development of other energy sources to a degree that they can replace hydrocarbons? Maybe. I am pessimistic about this because we will also be faced with many other challenges in the coming decades and they will all be of very significant proportions. Assembling vast amounts of wind farms, hydroelectric dams, nuclear power plants, etc... will become increasingly more difficult if/when crude prices rise and supply dwindles. What kind of pressures will this put on the agricultural industry which relies heavily on hydrocarbons?

Even with another 50 -100 years, we're going to be challenged...Yes the issue you describe, sometimes called the energy trap, after a close look gives me little concern. I find that the US economy has i) an enormous amount of energy consumption slack in it that is ignored, and likewise ii) has an enormous capability to produce alternatives.

For case i), reference the 1979/Iranian oil crisis. US energy use per capita had been continually increasing every year as far back as the data shows. In 1978 it was at its all time high, and by 1983 after the crisis had dropped 14%. Yet during that same 5 year period GDP rose 32% (not inflation corrected). Here's another narrower example. A US family summer vacation might be 1000 miles round trip, consuming 5GJ (5e9 Joule) in the average 25 mpg car. This source claims the construction of a nuclear power plant requires 25PJ (25e15 Joule) (http://world-nuclear.org/info/inf11.html), so that if 100 million families decided to forego a single summer vacation (gasp!) twenty new nuclear power plants could be built from the energy savings. If all those skipped family vacations were air travel, 2 people one flight (http://www.inference.phy.cam.ac.uk/withouthotair/c5/page_35.shtml), then 340 nuclear plants could be built.

For case ii), the ability to quickly produce alternatives, look at ethanol. Yes corn ethanol is a poor energy crop, is a dumb subsidy, using up arable land, etc, but this is beside the immediate point, which in this case is volume. US ethanol production, going from almost nothing a decade ago, is now one million barrels per day (http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=M_EPOO_YNP_NUS_MBBLD&f=M), and it would be greater if not for the 10% blend limit imposed by the EPA that has leveled off production. For comparison the US produces almost six million bbls / day of crude oil (and rising). (http://www.eia.gov/dnav/pet/hist_chart/MCRFPUS2M.jpg)

[mheslep]

...
Actually, the size of the well bores has very little to do with recovery of the resource.
By virtual bore diameter, I refer to the reach of the created fissures shown in this illustration:

http://assets.nybooks.com/media/photo/2012/02/15/mckibben_2-030812_jpg_630x511_crop_q85.jpg

This increases the explored volume well beyond the bit diameter and thus the odds of success.

Typically, these wells produce at very high rates initially and then drop off quickly.
Last I looked, yes hydro frac gas drops initially in the first months and then stabilizes to a slow decrease. Is that your understanding?

They definitely do have a much better success rate based on the simple fact that the gas is pervasive. But it isn't a simple one to one comparison (simply based on the intensity of unconventional drilling).I don't follow the last sentence. Can you please explain further?

[SixNein]

While possibly true I don't think it is fundamentally true that new(er) methods must use more energy, just because they have not been used before.

Advances in technology cannot violate the laws of thermodynamics. We can find more efficient methods of extraction from sources like oil sands; however, we will never match the energy efficiency of conventional wells. And here is why:

"About two tons of oil sands are required to produce one barrel (roughly 1/8 of a ton) of oil."
http://en.wikipedia.org/wiki/Oil_sands#Extraction_process

Lets pretend for a moment that we were pumping oil sand like a conventional well. We would need to pump 16 tons of sand in order to produce 1 ton of oil. In a conventional well, we would get much closer to 16 tons of oil. So just from the extraction standpoint alone, we have lost a great deal of efficiency. And we still have to separate the oil from the sand.

We are very close if not at peak production of oil. But the peak should not worry people nearly so much as the long terminal decline. How do we manage the long term?

[SixNein]

The question arises: Can we change policies and regulations quickly enough to allow for the development of other energy sources to a degree that they can replace hydrocarbons? Maybe. I am pessimistic about this because we will also be faced with many other challenges in the coming decades and they will all be of very significant proportions. Assembling vast amounts of wind farms, hydroelectric dams, nuclear power plants, etc... will become increasingly more difficult if/when crude prices rise and supply dwindles. What kind of pressures will this put on the agricultural industry which relies heavily on hydrocarbons?

Even with another 50 -100 years, we're going to be challenged.

There is going to be a need for lifestyle changes. Historically, we can divide the modern era into two parts: Expansion of oil production and decline of oil production. My best guess is that we are going to be seeing a great deal of demand destruction. In addition, we may begin to measure economies by how fast they decay.

Renewable technology is going to be very difficult without massive energy storage systems. And nuclear is going to be difficult from a psychological perspective, and it will be difficult from a military perspective.

[CaptFirePanda]

For case i), reference the 1979/Iranian oil crisis. US energy use per capita had been continually increasing every year as far back as the data shows. In 1978 it was at its all time high, and by 1983 after the crisis had dropped 14%. Yet during that same 5 year period GDP rose 32% (not inflation corrected).

That's all well and good, but since the 1980's the gap between US production and consumption has widened significantly. Anomalous drops in consumption reveal that, to some degree, conservation may help. The bigger picture, however, reveals that production is hitting a plateau and nominal drops in consumption will not be enough.

http://i.imgur.com/974Ec.jpg

(taken from here (http://205.254.135.24/totalenergy/data/annual/pdf/aer.pdf))

Also, I am highly doubtful that the US economy will be making strides like it did in the 80's.


Here's another narrower example. A US family summer vacation might be 1000 miles round trip, consuming 5GJ (5e9 Joule) in the average 25 mpg car. This source claims the construction of a nuclear power plant requires 25PJ (25e15 Joule) (http://world-nuclear.org/info/inf11.html), so that if 100 million families decided to forego a single summer vacation (gasp!) twenty new nuclear power plants could be built from the energy savings. If all those skipped family vacations were air travel, 2 people one flight (http://www.inference.phy.cam.ac.uk/withouthotair/c5/page_35.shtml), then 340 nuclear plants could be built.

The construction of 340 nuclear power plants would be a very significant contribution to alternative sources of energy in the US. These plants, of course, could not be built overnight and, seeing that the Plant Vogtle in Georgia (which was approved earlier this year) was the first in 34 years to be approved and likely won't be operational until 2017, I would suggest that the time required to get 340 plants proposed, approved and built would be significant. Also, nuclear power isn't what keeps the US transportation industry driving, nor does it keep any of those tourist-laden planes aloft.

For case ii), the ability to quickly produce alternatives, look at ethanol. Yes corn ethanol is a poor energy crop, is a dumb subsidy, using up arable land, etc, but this is beside the immediate point, which in this case is volume. US ethanol production, going from almost nothing a decade ago, is now one million barrels per day (http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=M_EPOO_YNP_NUS_MBBLD&f=M), and it would be greater if not for the 10% blend limit imposed by the EPA that has leveled off production. For comparison the US produces almost six million bbls / day of crude oil (and rising). (http://www.eia.gov/dnav/pet/hist_chart/MCRFPUS2M.jpg)

The US consumes ~19.2 million bbl, so that would meet 5% of the consumption for the country. Increasing production beyond current numbers, even without EPA restrictions, is likely not going to happen. Food/arable land is just as (if not more) valuable, so offsetting hydrocarbon consumption by taking up valuable agricultural land is something that would be far from an easy sell.

I pointed out that pulling oil out of shale is not the only place where energy is consumed. In response you ignore that point and repeat what you said previously. Why?

Let's not have anyone fool us or fool ourselves. What about Hamm's reasoning?

I didn't ignore it, I just missed the addition you made to that post. As for Hamm's reasoning, he does a very good job at saying what any CEO of an oil & gas company should say.

By virtual bore diameter, I refer to the reach of the created fissures shown in this illustration:

This increases the explored volume well beyond the bit diameter and thus the odds of success.

The term "virtual" well bore is something I am not familiar with and does not seem to come up on any sort of regular basis in discussion around hydraulic fracturing.

Please note that fracturing of wells is something that has been done in vertical wells throughout the history of oil and gas production. It is not a new concept. Techniques have changed and adapted to suit new resources (eg. shale gas), but it has been used for decades.

Last I looked, yes hydro frac gas drops initially in the first months and then stabilizes to a slow decrease. Is that your understanding?

Production drops off significantly throughout the first year of production. New wells are therefore required in order to compensate for this drastic drop-off in order to maintain production levels.

I don't follow the last sentence. Can you please explain further?

I was addressing your statement about how much more successful the shale gas wells are based on the drilling techniques. As I'd mentioned, the gas in these plays is pervasive, but very disseminated throughout the entire play (which can cover vast geographical areas). Thus, the chances of getting some gas are very high. However, drilling intensity has to increase in order to see viable rates of production. Your typical vertical well, on the other hand, may have a limited areal extent, but they are drilled to intersect much more productive gas horizons.

[mheslep]

...
We can find more efficient methods of extraction from sources like oil sands; however, we will never match the energy efficiency of conventional wells. And here is why:

"About two tons of oil sands are required to produce one barrel (roughly 1/8 of a ton) of oil."
http://en.wikipedia.org/wiki/Oil_sands#Extraction_process

Lets pretend for a moment that we were pumping oil sand like a conventional well. We would need to pump 16 tons of sand in order to produce 1 ton of oil. In a conventional well, we would get much closer to 16 tons of oil. So just from the extraction standpoint alone, we have lost a great deal of efficiency. And we still have to separate the oil from the sand. Comparisons are not well served by examining one side of the problem. How much energy do you imagine is required to pull oil up a vertical well from two miles below the surface, or set up an off shore drilling platform, or drill dry wells? Oil sands projects don't have failed exploration problems, the resource is near the surface. We've already seen the energy comparison of oil sand production to traditional production courtesy of CaptFP. Yes oil sand requires more energy than *average* traditional oil, but not all all traditional, and certainly not as much more as you story indicates. Anyway the thread above (recently) is about shale oil and gas and hydraulic fracturing, not the tar sands.

We are very close if not at peak production of oil.<shrug> Maybe, but saying it does not make it so.

But the peak should not worry people nearly so much as the long terminal decline. ...Why? Energy consumption in the developed world is in a long decline.

[SixNein]

Comparisons are not well served by examining one side of the problem. How much energy do you imagine is required to pull oil up a vertical well from two miles below the surface, or set up an off shore drilling platform, or drill dry wells? Oil sands projects don't have failed exploration problems, the resource is near the surface. We've already seen the energy comparison of oil sand production to traditional production courtesy of CaptFP. Yes oil sand requires more energy than *average* traditional oil, but not all all traditional, and certainly not as much more as you story indicates. Anyway the thread above (recently) is about shale oil and gas and hydraulic fracturing, not the tar sands.

<shrug> Maybe, but that's saying it does not make it so.

Why? Energy consumption in the developed world is in a long decline.

http://upload.wikimedia.org/wikipedia/commons/thumb/f/fe/EROI_-_Ratio_of_Energy_Returned_on_Energy_Invested_-_USA.svg/578px-EROI_-_Ratio_of_Energy_Returned_on_Energy_Invested_-_USA.svg.png

[SixNein]

Anyway the thread above (recently) is about shale oil and gas and hydraulic fracturing, not the tar sands.


On the topic of shale gas, a great deal of companies are pulling back on drilling because price is too low.

http://thetimes-tribune.com/news/as-gas-drilling-boom-slows-worry-sets-in-1.1273569#axzz1nLG40ovC
http://www.foxbusiness.com/news/2012/02/09/bg-group-to-cut-us-shale-gas-drilling/

Here is an interesting quote form the first link:

As recently as last week, natural gas futures were trading at $2.69 per million BTU, less than half the price it was as recently as September 2008 and far below the $5 to $7 level that many say is the average price required in North America to produce shale gas economically.

Read more: http://thetimes-tribune.com/news/as-gas-drilling-boom-slows-worry-sets-in-1.1273569#ixzz1nLGLeN2J

[mheslep]

That's all well and good, but since the 1980's the gap between US production and consumption has widened significantly.Since 2005 the gap has closed significantly as those graphs show, and continues to close. US oil imports have dropped ~25% since the peak back then.

The construction of 340 nuclear power plants would be a very significant contribution to alternative sources of energy in the US. These plants, of course, could not be built overnight and, seeing that the Plant Vogtle in Georgia (which was approved earlier this year) was the first in 34 years to be approved and likely won't be operational until 2017, I would suggest that the time required to get 340 plants proposed, approved and built would be significant. Also, nuclear power isn't what keeps the US transportation industry driving,...Sure, please don't overdraw the example, which was to show the amount of slack in the system. I provided it in response to the earlier
...Assembling vast amounts of wind farms, hydroelectric dams, nuclear power plants, etc... will become increasingly more difficult if/when crude prices rise and supply dwindles.
so substitute whatever energy infrastructure you care to build.

The US consumes ~19.2 million bbl, so that would meet 5% of the consumption for the country.Sure, and falling. Again I cited the explosive growth in corn ethanol in response to the query about energy changes being made "quickly enough", not to promote more ethanol. If you don't like corn ethanol (I don't), substitute your favorite biofuel approach (I like this one at 500 bbls/acre-year (http://www.jouleunlimited.com/faq/how-does-joule-calculate-potential-deliver-25000-gallons-ethanol-and-15000-gallons-diesel-acre-y)). I don't know what may or may not work, but once an approach is proven I have little doubt of industrial ability to scale up rapidly - as shown by corn ethanol.

Increasing production beyond current numbers, even without EPA restrictions, is likely not going to happen.Ethanol production is somehow fixed at today's levels? What is proven by a "not going to happen" assertion?

I didn't ignore it, I just missed the addition you made to that post. As for Hamm's reasoning, he does a very good job at saying what any CEO of an oil & gas company should say.Sorry I responded before your edit/update and since deleted the comment. Whatever Hamm's motivation, his explanation for the growth in US domestic oil production is logical.


Please note that fracturing of wells is something that has been done in vertical wells throughout the history of oil and gas production. It is not a new concept. Techniques have changed and adapted to suit new resources (eg. shale gas), but it has been used for decades.Yes I'm aware, (http://www.spe.org/jpt/print/archives/2010/12/10Hydraulic.pdf) though the current technique and scale is little like that of decades ago.

Production drops off significantly throughout the first year of production. New wells are therefore required in order to compensate for this drastic drop-off in order to maintain production levels.Sure, another reason why success rate is important. Drill (for instance) ~150,000 frac shale wells at 100 bbl/day and domestic supply meets demand (after refinery gains, some NG liquids, and some ethanol)

[mheslep]

<shrug>
As we've seen before:
http://www.oilsands.alberta.ca/images/FS-CES-GHG-Chart-Well2Wheels.png

[apeiron]

And nuclear is going to be difficult from a psychological perspective, and it will be difficult from a military perspective.

This is one aspect of the story that still really puzzles me.

I get that the gas and coal plays extend the dependence on fossil fuels past peak cheap oil for maybe 20 to 30 years, but why is the world not buying the nuclear play (apart from India perhaps, and those who want to make bombs)? Especially as green house gas emission targets are another reason to go nuclear, if it is in fact economic.

The maths was discussed earlier in this thread. Although I am no enthusiast of nuclear, I think Mheslep made a prima facie case for its viability - certainly enough to make me ask why it is not happening, and instead we have the likely far more environmentally damaging course of the gas and coal plays.

Answers anyone?

[apeiron]

<shrug>
As we've seen before:
http://www.oilsands.alberta.ca/images/FS-CES-GHG-Chart-Well2Wheels.png

Those are the figures from one study, paid for by the state doing the exploitation. Other studies paint a worse picture for tar sands.

And of course, the "tank to wheels" part of the chart is utterly irrelevant to the point the chart argues. It is a blatant perceptual massaging of the message.

So the chart I would like to see is a metastudy of just the well to tank figures. That would be the start of a fair judgement.

[CaptFirePanda]

Since 2005 the gap has closed significantly as those graphs show, and are continuing to close. US oil imports have dropped ~25% since the peak back then.

The over-riding reason behind those recent drops in consumption/import numbers is the extremely significant recession that we experienced in 2008.

Sure, please don't overdraw the example, which was to show the amount of slack in the system. I provided it in response to the earlier...so substitute whatever energy infrastructure you care to build.

I could substitute any sort of energy source in there but it doesn't make your point any more valid. All I have to do is expand the picture to global consumption because, as we know, the US is not the only consumer of hydrocarbons in the world and there are at least 2 developing countires that will more than pick up any slack US citizens are willing to give.

Sure, and falling.

No, not falling. Recovering perhaps, but definitely not falling.

Again I cited the explosive growth in corn ethanol in response to the query about energy changes being made "quickly enough", not to promote more ethanol. If you don't like corn ethanol (I don't), substitute your favorite biofuel approach (I like this one at 500 bbls/acre-year (http://www.jouleunlimited.com/faq/how-does-joule-calculate-potential-deliver-25000-gallons-ethanol-and-15000-gallons-diesel-acre-y)). I don't know what may or may not work, but once an approach is proven I have little doubt of industrial ability to scale up rapidly - as shown by corn ethanol.

As I've mentioned, land-use issues will inevitably arise with respect to any of these sorts of technologies. Whether they are taking up arable land or otherwise, there will be significant limitations on how large they can grow.

Ethanol production is somehow fixed at today's levels? What is proven by a "not going to happen" assertion?

The bit where I mention the difficulty in trying to use arable land and food supplies to satisfy energy needs rather than actually putting food on people's table. That has not been and will not be an easy sell.

Yes I'm aware, (http://www.spe.org/jpt/print/archives/2010/12/10Hydraulic.pdf) though the current technique and scale is little like that of decades ago.

They are different because they are being used to produce from very different geological horizons with very different physical properties that require far more intensive multi-stage fracturing techniques.

Sure, another reason why success rate is important. Drill (for instance) ~150,000 frac shale wells at 100 bbl/day and domestic supply meets demand (after refinery gains, some NG liquids, and some ethanol)

Since the 1980's the US had drilled about 220,000 (http://205.254.135.24/dnav/ng/hist/na1170_nus_8a.htm) gas wells so the 150,000 number equates to about 25 years of drilling (certainly not an overnight fix). Also with gas prices where they are now, it would take a lot of incentive and recovery for anyone to keep pace with historical rates of drilling (especially when drilling techniques are far more expensive).

By 100 bbl/day are you talking "barrel of oil equivalent" (BOE)? If so, average productivity of gas wells peaked in the 70's near 450,000 cubic feet/day/well (http://pubs.usgs.gov/fs/fs-0113-01/fs-0113-01.pdf). 100 BOE/day/well equates to about 600,000 cubic feet/day/well. Thus, you're hoping for a 33% increase in productivity for these wells. This seems optimistic to me.

[ThomasT]

What about the North Dakota oil field(s). Won't this, as well as the exploitation of Canadien oil, push the peak fossil fuel date back a bit?

[SixNein]

This is one aspect of the story that still really puzzles me.

I get that the gas and coal plays extend the dependence on fossil fuels past peak cheap oil for maybe 20 to 30 years, but why is the world not buying the nuclear play (apart from India perhaps, and those who want to make bombs)? Especially as green house gas emission targets are another reason to go nuclear, if it is in fact economic.

The maths was discussed earlier in this thread. Although I am no enthusiast of nuclear, I think Mheslep made a prima facie case for its viability - certainly enough to make me ask why it is not happening, and instead we have the likely far more environmentally damaging course of the gas and coal plays.

Answers anyone?

The EORI graph I posted should explain it. Compare nuclear to coal....

[SixNein]

What about the North Dakota oil field(s). Won't this, as well as the exploitation of Canadien oil, push the peak fossil fuel date back a bit?

No, in fact, those unconventional sources are a sign of peak oil. But understand, peak oil is more of a misnomer for cheap oil.

[apeiron]

The EORI graph I posted should explain it. Compare nuclear to coal....

Yes, but that shows nuclear in the middle of the pack and tar sands down the tail.

So the logic of cheap coal for electricity baseload generation is clear. And coal-to-fuel may pay for itself above other transport and fertiliser plays. (Although you would have to factor in future carbon taxes that may be added to get a truer picture of EROEI.)

However there are plenty who claim nuclear is already cheap enough and could get much cheaper.

See earlier posts about what the pro-lobby claim...http://www.physicsforums.com/showpost.php?p=3131150&postcount=299

we find that the levelized cost of electricity from nuclear power is 8.4¢/kWh, denominated in 2007 dollars. The levelized cost of electricity from coal, exclusive of any carbon charge, is 6.2¢/kWh, denominated in 2007 dollars. The levelized cost of electricity from gas, exclusive of any carbon charge, is 6.5¢/kWh

[EDIT: sorry, that was those questioning the pro-lobby - I meant the earlier cites from Mheslep like http://www.physicsforums.com/showpost.php?p=2814081&postcount=54.]]

Regarding cost for nuclear, this varies considerably by country, another reason why addressing the problem world wide is complicated. In the US yes nuclear capital costs appear to be $5-7 / W(e). However China is throwing up PWBs for $1.6/W(e), or $1.6B for a one GW(e) reactor (as pointed out by signerror)


So either such figures are an exaggeration when all externalities are taken into account (the cost of insuring plants, the cost of decommissioning plants, etc) or there are other non-economic factors that I don't understand.

Personally, I believe it most like is just economics.

And the fact that tar sands/shale gas are now being produced are evidence of this. Even though they may be "economic" only because they are flowing into an existing economic infrastructure that has the hidden subsidies and political capture, as well as the refineries, pipelines, capital and vehicle lock-in, to make them viable. As well as no serious accounting of environmental impact.

I don't believe that any fear of nuclear or other psychological barriers would be allowed to stand in the way of nuclear alternatives. You would only have to dim a country's lights for a weekend and citizens would be screaming at governments to get on with building reactors.

The anti-nuclear mentality seems more fueled by the anti-proliferation movement, which countries already with nukes would encourage for reasons of military strategy. So the psychology is encouraged because it suits the world's biggest energy users at present, and keeps the bigger energy exporters at bay.

So no, I'm still not clear of the real reasons why nuclear is not yet the play. It could be clear-cut EROEI. But then that would only mean that fossil fuels economics are so distorted that the price signals are not getting through. It is irrational market behaviour that needs good international regulation to fix.

[SixNein]

Yes, but that shows nuclear in the middle of the pack and tar sands down the tail.

So the logic of cheap coal for electricity baseload generation is clear. And coal-to-fuel may pay for itself above other transport and fertiliser plays. (Although you would have to factor in future carbon taxes that may be added to get a truer picture of EROEI.)

However there are plenty who claim nuclear is already cheap enough and could get much cheaper.

See earlier posts about what the pro-lobby claim...http://www.physicsforums.com/showpost.php?p=3131150&postcount=299


Economically, we don't have an alternative that can compete with coal on price. If the future environmental damage was calculated as a part of the price, alternatives might be priced into the market. On the other hand, it could be suicide for the economy unless all players in the global market agreed to participate. And I don't foresee any agreements like that any time soon. The Kyoto Protocol went down the toilet fast because China and India were exempt.


Personally, I believe it most like is just economics.

And the fact that tar sands/shale gas are now being produced are evidence of this. Even though they may be "economic" only because they are flowing into an existing economic infrastructure that has the hidden subsidies and political capture, as well as the refineries, pipelines, capital and vehicle lock-in, to make them viable. As well as no serious accounting of environmental impact.


They are also becoming priced into the market because conventional wells are in decline. Peak oil is mostly about the economics of oil once the conventional wells dry up.


I don't believe that any fear of nuclear or other psychological barriers would be allowed to stand in the way of nuclear alternatives. You would only have to dim a country's lights for a weekend and citizens would be screaming at governments to get on with building reactors.

The anti-nuclear mentality seems more fueled by the anti-proliferation movement, which countries already with nukes would encourage for reasons of military strategy. So the psychology is encouraged because it suits the world's biggest energy users at present, and keeps the bigger energy exporters at bay.

So no, I'm still not clear of the real reasons why nuclear is not yet the play. It could be clear-cut EROEI. But then that would only mean that fossil fuels economics are so distorted that the price signals are not getting through. It is irrational market behaviour that needs good international regulation to fix.

Good luck on getting the international stuff worked out.

[ThomasT]

This is one aspect of the story that still really puzzles me.

I get that the gas and coal plays extend the dependence on fossil fuels past peak cheap oil for maybe 20 to 30 years, but why is the world not buying the nuclear play (apart from India perhaps, and those who want to make bombs)? Especially as green house gas emission targets are another reason to go nuclear, if it is in fact economic.

The maths was discussed earlier in this thread. Although I am no enthusiast of nuclear, I think Mheslep made a prima facie case for its viability - certainly enough to make me ask why it is not happening, and instead we have the likely far more environmentally damaging course of the gas and coal plays.

Answers anyone?Just guessing, but maybe the technology isn't advanced enough to label nuclear a sure thing. Plus nuclear is really expensive up front. So, the vast shale oil deposits, coal deposits, etc., which don't require the building of immensely expensive nuclear facilities, or even new refineries, and which promise a quicker return on investment, will be emphasized for at least the foreseeable future.

Coupled with the already existing oil and coal infrastructure, then nuclear is a nonstarter.

[SixNein]

Just guessing, but maybe the technology isn't advanced enough to label nuclear a sure thing. Plus nuclear is really expensive up front. So, the vast shale oil deposits, etc., which don't require the building of immensely expensive nuclear facilities, or even new refineries, and which promise a quicker return on investment, will be emphasized for at least the foreseeable future.

Nuclear competes more with coal than oil.

There really is no good alternatives to oil for the combustible engine that can meet our demand. We are simply just stuck.

[ThomasT]

Nuclear competes more with coal than oil.

There really is no good alternatives to oil for the combustible engine that can meet our demand. We are simply just stuck.That agrees with what I've read. I wonder about the future prospects of hydrogen, etc., fuel cells (mostly for individual vehicles, a large part of the consumption of oil, afaik). Obviously wind and solar are limited by current storage capability technology, as well as the cost to individual consumers who might choose to implement, say, solar technology and live free of the grid.

[apeiron]

Nuclear competes more with coal than oil.

There really is no good alternatives to oil for the combustible engine that can meet our demand. We are simply just stuck.

I think this may be at the heart of it. We need everyone to switch to electric cars. And then even if we do that, trucks, planes, farm equipment and military hardware still needs the grunt of diesel.

So we are still on track for economic adjustments like we are seeing in Greece right now. :wink:

[ThomasT]

So we are still on track for economic adjustments like we are seeing in Greece right now. :wink:Do you really think so? I don't see the US as having Greece-type economic problems ... ever.

[apeiron]

Do you really think so? I don't see the US as having Greece-type economic problems ... ever.

I was thinking of the world, or that part of the world which is used to having expectations of wealth.

[mheslep]

Since the 1980's the US had drilled about 220,000 (http://205.254.135.24/dnav/ng/hist/na1170_nus_8a.htm) gas wells so the 150,000 number equates to about 25 years of drilling (certainly not an overnight fix). Also with gas prices where they are now, it would take a lot of incentive and recovery for anyone to keep pace with historical rates of drilling (especially when drilling techniques are far more expensive).Recent drilling rates are much higher as that EIA data shows: 20.5 thousand gas wells per year 2007-9. Yes these frac wells are much more expensive, but the US industry as a whole is also drilling 3X fewer feet of dry hole (http://205.254.135.24/dnav/pet/hist/LeafHandler.ashx?n=PET&s=E_ERTWD_XWF0_NUS_MF&f=A) than they were back in (say) the 1960s, and that's against today's higher drilling rate.

By 100 bbl/day are you talking "barrel of oil equivalent" (BOE)? ....I was referring to actual oil, and was estimating how many shale oil wells would be required for domestic production to meet consumption. The N. Dakota (Bakken) per well average is 86 bpd. (https://www.dmr.nd.gov/oilgas/stats/historicaloilprodstats.pdf)

Thanks for the well sourced replies. More later ...

[ThomasT]

No, in fact, those unconventional sources are a sign of peak oil. But understand, peak oil is more of a misnomer for cheap oil.I don't understand. These are, afaik, vast oil resources. Peak oil is about exploitable resources, isn't it?

[MarcoD]

The problem is exponential growth with limited resources. If it is exponential, then there is a doubling time, which implies a time where you will use exactly the same amount of resources as throughout the whole of history, as well as consume the last resources during that period.

[mheslep]

No, not falling. Recovering perhaps, but definitely not falling.

Yes, and falling. Product supplied as of last week was down to 18.054 mbpd (4 week average), or 1.2 mbpd less than the same time last year. The last time US petroleum consumption was below the current level was March of 1997
http://205.254.135.24/dnav/pet/hist_chart/WRPUPUS24.jpg
http://205.254.135.24/dnav/pet/hist/LeafHandler.ashx?n=pet&s=wrpupus2&f=4

[ThomasT]

The problem is exponential growth with limited resources.But there's not exponential growth wrt consumption of fossil fuels, is there? Yes, consumption is increasing. But so can production. At least, as far as I can tell, for the next century ... and maybe a lot longer.

[SixNein]

I don't understand. These are, afaik, vast oil resources. Peak oil is about exploitable resources, isn't it?

The textbook definition is the peak production of oil.

And there is reason to believe we might have peaked out on production. For example, oil prices have been rapidly increasing over the last decade while production has been hanging out on a plateau. Economics would suggest a constrained supply.

http://www.theoildrum.com/files/FIG_02_SPLIT_CRUDE_OIL_SUPPLY_OCT_2010.PNG

And the military says this:

By 2012, surplus oil production capacity could entirely disappear, and as early as 2015, the shortfall in output could reach nearly 10 million barrels per day
..
..
..
While it is difficult to predict precisely what economic, political, and strategic effects such a shortfall might produce, it surely would reduce the prospects for growth in both the developing and developed worlds. Such an economic slowdown would exacerbate other unresolved tensions, push fragile and failing states further down the path toward collapse, and perhaps have serious economic impact on both China and India."


http://www.jfcom.mil/newslink/storyarchive/2010/JOE_2010_o.pdf

Make no mistake... the problem is quite serious.

[CaptFirePanda]

Recent drilling rates are much higher as that EIA data shows: 20.5 thousand gas wells per year 2007-9. Yes these frac wells are much more expensive, but the US industry as a whole is also drilling 3X fewer feet of dry hole (http://205.254.135.24/dnav/pet/hist/LeafHandler.ashx?n=PET&s=E_ERTWD_XWF0_NUS_MF&f=A) than they were back in (say) the 1960s, and that's against today's higher drilling rate.

Those numbers are for dry (eg. non-productive) exploratory and developmental wells (both oil and gas). Looking at the producing numbers, the footage is fairly substantial. It is good to know we are drilling less for dry holes based on technological advantages, but there is certainly a need to drill a lot of footage (and, in some cases (http://205.254.135.24/dnav/pet/hist/LeafHandler.ashx?n=PET&s=E_ERTWG_XWFD_NUS_MF&f=A), well over historical numbers)

I was referring to actual oil, and was estimating how many shale oil wells would be required for domestic production to meet consumption. The N. Dakota (Bakken) per well average is 86 bpd. (https://www.dmr.nd.gov/oilgas/stats/historicaloilprodstats.pdf)

Thanks for the well sourced replies. More later ...

You're welcome. I didn't notice the jump to oil.

Anyway, there are currently around 500 (I'm picking a high number here) wells drilled per year in the Bakken (overall, there are ~5,000-7,000 oil wells drilled per year in the US, but I cannot break out the shale oil wells at this point. I suggest that they represent a small portion of this number). Hitting that 150,000 mark would be a pretty significant.

I would also caution against the average production rate. One, you are including historical data for oil not necessarily produced from shales (the Bakken isn't all shale). Also, this doesn't show the natural and rapid decline in production of these wells. Wells peter out quickly and are replaced by new wells in a short time frame (likely 1-2 years).

I'll comment further on the the consumption in the US (I need sleep!). Suffice it to say, the recession isn't over and recovery will not be a smooth line. The long term trend is still upwards and, unless some form of technology that I haven't heard of has offset consumption since ~2008, the trend will continue upwards.

[mheslep]

That's all well and good, but since the 1980's the gap between US production and consumption has widened significantly.Since 2005 the gap has closed significantly as those graphs show, and are continuing to close. US oil imports have dropped ~25% since the peak back then.
The over-riding reason behind those recent drops in consumption/import numbers is the extremely significant recession that we experienced in 2008. That conclusion is not justified, especially given the recession was Fall 2008 and imports have has been falling since 2005. Yes economic slow downs deserve some of the blame for energy imports and consumption, but other factors apply apply including improvements in economic energy intensity and increase in domestic supply:
1. US energy intensity (energy per unit of economic output) has been cut in half since 1980, (http://www.google.com/publicdata/explore?ds=d5bncppjof8f9_&ctype=l&met_y=eg_use_pcap_kg_oe#!ctype=l&strail=false&bcs=d&nselm=h&met_y=eg_use_comm_gd_pp_kd&scale_y=lin&ind_y=false&rdim=region&idim=country:USA&ifdim=region&tstart=319698000000&tend=1266469200000&hl=en&dl=en)and improved 10% the period 2007 to 2010.
2. US domestic crude production has been rising since ~2007 (up 1 mbbl/day), as have natural gas liquids (up ~500kbbl/day) (http://205.254.135.24/totalenergy/data/monthly/pdf/sec3_2.pdf)
3. Ethanol production has doubled in the last couple years (see graph from earlier post), now 1 mbbl/day.
Those three things contribute strongly to the reduction in imports and consumption.

I could substitute any sort of energy source in there but it doesn't make your point any more valid. All I have to do is expand the picture to global consumption because, as we know, the US is not the only consumer of hydrocarbons in the world and there are at least 2 developing countires that will more than pick up any slack US citizens are willing to give.
A fair point. (http://www.google.com/publicdata/explore?ds=d5bncppjof8f9_&ctype=l&met_y=eg_use_pcap_kg_oe#!ctype=l&strail=false&bcs=d&nselm=h&met_y=eg_use_comm_kt_oe&scale_y=lin&ind_y=false&rdim=region&idim=country:USA:CHN:IND&ifdim=region&tstart=319698000000&tend=1266469200000&hl=en&dl=en) Note though that energy prices have a way to go before they are constant around the world, and exports to the highest bidder immediate. Natural gas for instance is priced overseas at several multiples of the of the US price (for now). Bakken oil sells at a $30/bbl discount locally (for now). I doubt a squeeze in supply meeting demand becomes serious enough to stop a build out in more energy infrastructure.

(I like this one at 500 bbls/acre-year). I don't know what may or may not work, but once an approach is proven I have little doubt of industrial ability to scale up rapidly - as shown by corn ethanol.As I've mentioned, land-use issues will inevitably arise with respect to any of these sorts of technologies. Whether they are taking up arable land or otherwise, there will be significant limitations on how large they can grow.The depends on the efficiency of the biofuel method and the consumption at the time. That 500 bbl/acre-year engineered bacteria approach (should it work) requires 13 million acres to meet all of US current consumption (18 mbbl/day). That compares well to the 90 million acres in use currently for all US corn crops, not that such an approach needs arable land.

[ThomasT]

The textbook definition is the peak production of oil.

And there is reason to believe we might have peaked out on production. For example, oil prices have been rapidly increasing over the last decade while production has been hanging out on a plateau. Economics would suggest a constrained supply.

http://www.theoildrum.com/files/FIG_02_SPLIT_CRUDE_OIL_SUPPLY_OCT_2010.PNG

And the military says this:


http://www.jfcom.mil/newslink/storyarchive/2010/JOE_2010_o.pdf

Make no mistake... the problem is quite serious.From the graph, it doesn't seem to me that the price of oil has anything to do with supply and demand. Maybe you can explain it to me.

So, what, exactly, is the problem? As far as I can tell there's no current shortage of oil. And prices rise and drop more or less arbitrarily.

[SixNein]

From the graph, it doesn't seem to me that the price of oil has anything to do with supply and demand. Maybe you can explain it to me.

So, what, exactly, is the problem? As far as I can tell there's no current shortage of oil. And prices rise and drop more or less arbitrarily.


There are many different types of oil fields. For the most part, we have been getting most of our oil from conventional oil wells. These are very easy to extract oil from, and they have the highest EORI. The production on this type of field has peaked and is entering decline. Part of the problem is replacing the lost production with other sources be it shale, ethanol, or tar sands. These are more intensive to produce and have lower EORI. In a basic nutshell, the industry will need to flat our run in order to stand still.

The other part of the problem is dealing with global demand:


The number of registered cars, buses, vans, and trucks on the road in China reached 62 million in 2009, and is expected to exceed 200 million by 2020, though by 2050 it will be surpassed by neighbouring India and be pushed to second place in total automobiles.[

http://en.wikipedia.org/wiki/Automotive_industry_in_the_People%27s_Republic_of_ China

There is also the issue of growing internal demand in exporting nations.



In a basic nutshell, the ultimate problem is gas prices are going climb.

[SixNein]

In a basic nutshell, the ultimate problem is gas prices are going climb.

The ultimate question is how deep are we in the muck? We wont know until we find out how fast we can get these unconventional sources up and running and at what levels of production.

I seriously doubt we can match convention production with unconventional sources. EORI on these sources really seems to indicate that they are not going to keep up.

[SixNein]

I was in the middle of a detailed response message when the power went out and I lost my work. Ironic that it happened while I was posting about energy developments! Anyway, the main issue, imo, is that people can't expect that current consumption patterns are going to magically cause solar power, fossil fuel supply, or any other aspect of energy resourcing to behave in ways they expect it to. People act as if the energy sources have to meet their cultural expectations instead of the other way around. If solar doesn't work it night, it may be that people are going to have to adapt their cultural patterns to go without electricity at night. It may not be necessary to do this right away or all at once, but it makes more sense to me that if you estimate that eventually it will be inevitable that you would rather transition slowly than wait for the sh*t to hit the fan, so to speak.

Very good point and likely imo. There is simply no way we can meet demand for everyone in the world to consume energy like Americans.

Currently, I believe the political-mechanical issue is whether free-markets are suited to adapt to energy production and consumption needs for the future. Presumable with valid knowledge about the future they would be, but the problem is that market interests themselves exert influence on future-knowledge in a way that suits short-term profit-motives and consumer-habits. In short, consumers are willing to pay to be told what they want to believe, even if that means making the disaster worse in the long run. Many people simply don't believe there's any disaster even coming - that it is just a trick on the part of people who want to generate cultural change.

The biggest question is whether government should allow solar developments to get priced out of the market, or whether some combination of subsidies and business-model intervention could push the solar-energy industry in the direction of making technologies more accessible, affordable, and therefore widespread. Of course, if existing energy-interests decide that growth of solar is going to interfere with their ability to maintain infrastructure with a narrower customer base, they will probably focus on preventing solar from gaining market share, just because they need the money to continue funding their operations, which they have a stake in maintaining.

Great post

[SixNein]

it is relatively common knowledge that world reserves today are larger than they were in the past.
.
.
.
The only standard is the prescisely defined proved reserves, which are subject to regulation and verification.

Correction... there is regulation and verification in the US.

The same is not true of the international community. OPEC countries are unaudited and report whatever they damn well please. In fact, they have motivation to over-report their reserves.

Outside of looking at their fudged numbers, for example, see the numbers in red here:
http://en.wikipedia.org/wiki/Oil_reserves#OPEC_countries

We see stuff like this:

The cables, released by WikiLeaks, urge Washington to take seriously a warning from a senior Saudi government oil executive that the kingdom's crude oil reserves may have been overstated by as much as 300bn barrels – nearly 40%.

http://www.guardian.co.uk/business/2011/feb/08/saudi-oil-reserves-overstated-wikileaks

[SixNein]

Interesting
http://www.nature.com/nature/journal/v481/n7382/full/481433a.html

[ThomasT]

There are many different types of oil fields. For the most part, we have been getting most of our oil from conventional oil wells. These are very easy to extract oil from, and they have the highest EORI. The production on this type of field has peaked and is entering decline. Part of the problem is replacing the lost production with other sources be it shale, ethanol, or tar sands. These are more intensive to produce and have lower EORI. In a basic nutshell, the industry will need to flat our run in order to stand still.I see.

The other part of the problem is dealing with global demand:


http://en.wikipedia.org/wiki/Automotive_industry_in_the_People%27s_Republic_of_ China

There is also the issue of growing internal demand in exporting nations.



In a basic nutshell, the ultimate problem is gas prices are going climb.I forgot about increasing demand in China, India, etc. . Ok, the picture/problem is getting clearer for me. Usable petroleum products are harder and increasingly more expensive to produce, and demand for them continues to increase. Hence, higher prices.

Any predictions on what it will be in the US in, say, 2020?

[SixNein]

I see.

I forgot about increasing demand in China, India, etc. . Ok, the picture/problem is getting clearer for me. Usable petroleum products are harder and increasingly more expensive to produce, and demand for them continues to increase. Hence, higher prices.

Any predictions on what it will be in the US in, say, 2020?

Right, the unconventional sources are harder to produce. And in particular, there is really no chance of getting the kind of rates we need. A lot of people think about volume in the ground, but don't really think about volume to the market. In other words, how much volume can one get out of the ground and to the market with any given oil field per year. The volume to the market determines how much oil we have to use for any given year. Tar sands for example have plenty of volume in the ground, but the rates are limited in ways that conventional oil is not due to processing the sand. On top of that, the EROI is much lower. So the rates we get out of the tar sands are much lower. At the end of the day, the peak of conventional oil wells signal a peak of oil production. Now put that on top of increasing demand, and it doesn't take much to see one has a really big problem.

The 2020 price will depend a lot on the state of conventional oil wells, politics, and demand. There is quite a bit of uncertainty on the conventional well reserves because there is no accountability on the figures provided by oil producing nations. In a basic nutshell, we don't have access to trustworthy data. So projections vary from now to 2040 on world production decline. But by looking at current world production for crude, it seems to have leveled off for the last 9 years. What production gains we have had comes from other liquids. And that is one of the reasons we've seen so much speculation on oil in the market.

Here is a link with a break up on liquids:
http://www.theoildrum.com/files/Screen%20shot%202012-02-13%20at%209.02.36%20AM.png

[SixNein]

A study by a German military think tank has analyzed how "peak oil" might change the global economy. The internal draft document -- leaked on the Internet -- shows for the first time how carefully the German government has considered a potential energy crisis.

http://www.spiegel.de/international/germany/0,1518,715138,00.html



The government was warned by its own civil servants two years ago that there could be "significant negative economic consequences" to the UK posed by near-term "peak oil" energy shortages.

http://www.guardian.co.uk/environment/2011/jun/15/peak-oil-warning


The world is much closer to running out of oil than official estimates admit, according to a whistleblower at the International Energy Agency who claims it has been deliberately underplaying a looming shortage for fear of triggering panic buying.


http://www.guardian.co.uk/environment/2009/nov/09/peak-oil-international-energy-agency

[DrClapeyron]

China is ramping up production of solar pannels. (http://www.bloomberg.com/news/2012-02-24/china-encourages-solar-product-makers-to-expand-amid-supply-glut.html)


China Encourages Solar-Product Makers to Expand Amid Supply Glut
By Bloomberg News - Feb 24, 2012 8:29 AM CT

China set targets for increasing production capacity at key polysilicon and solar cell makers, part of the government’s plan to ensure its companies survive a slump in prices.

China wants each “leading” company to have 50,000 tons a year of polysilicon capacity by 2015 and targets 5 gigawatts for each of its top solar-cell makers, according to a five-year plan posted on the Ministry of Industry and Information Technology website today.

And in other news BP is finding it difficult to compete with Chinese solar pannel manufacturers (http://www.bloomberg.com/news/2012-02-24/bp-tells-partners-of-plan-to-withdraw-from-australia-solar-power-project.html).


BP Plans to Withdraw From Solar-Energy Venture in Australia
By James Paton - Feb 24, 2012 1:59 AM CT

BP Plc (BP/), Europe’s second-largest oil company, plans to withdraw from a venture seeking Australian government funds to build a solar-power project in the state of New South Wales.

“We’ve indicated that we wish to leave the consortium and that we won’t be part of the new bid process,” Jamie Jardine, a Melbourne-based spokesman for BP, said by mobile phone today.


...

The company decided to exit the global solar business after 40 years because it has become unprofitable, Mike Petrucci, the chief executive officer of BP’s solar unit, told staff in an internal letter in December. The industry faces oversupply and price pressures after Chinese competitors increased production.

[apeiron]

And in other news BP is finding it difficult to compete with Chinese solar pannel manufacturers (http://www.bloomberg.com/news/2012-02-24/bp-tells-partners-of-plan-to-withdraw-from-australia-solar-power-project.html).

Comparing China vs US energy strategies ought to tell us a lot about where the world will be going in next 30 years.

A Chinese political scientist told me it boils down to China being a nation run by engineers and the US a nation run by lawyers. :rofl:

[mheslep]

I think this may be at the heart of it. We need everyone to switch to electric cars. And then even if we do that, trucks, planes, farm equipment and military hardware still needs the grunt of diesel.

So we are still on track for economic adjustments like we are seeing in Greece right now. :wink:Electric motors have more than enough 'grunt' for any heavy duty transportation task one cares to imagine, as we all are reminded (or should be) every time we board the electric subway that accelerates 50-200 tons from 0 to 60 mph in 10secs or so. The limitation brought on by batteries lies with long distance range and perhaps extreme temperature cases, for now.

[mheslep]

But by looking at current world production for crude, it seems to have leveled off for the last 9 years. What production gains we have had comes from other liquids. ...

Here is a link with a break up on liquids:
http://www.theoildrum.com/files/Screen%20shot%202012-02-13%20at%209.02.36%20AM.png
But why look at just crude? During the same 9 years all liquid fuels increased 10-11 mbpd. Consumption is largely agnostic about source.

[SixNein]

But why look at just crude? During the same 9 years all liquid fuels increased 10-11 mbpd. Consumption is largely agnostic about source.

We look at just crude because we are interested in the production of those conventional oil wells. If we were to combine all of that information, we would arrive at Simpson's paradox, and we would draw incorrect conclusions about their state because of the lurking variables.

[apeiron]

Electric motors have more than enough 'grunt'....

Energy density is the issue....
http://www.global-greenhouse-warming.com/support-files/biodiesel_deer_future.pdf

[mheslep]

Energy density is the issue....
http://www.global-greenhouse-warming.com/support-files/biodiesel_deer_future.pdfYes, of which range is a linear function. At some point though I hope these 50:1 joule/kg comparisons shown in the front matter of these presentations go away, as heat engines inevitably through away more than half of that energy. Then of course diesel and gasoline engines don't run by themselves, they require the additional mass and volume of a fuel pump, oil pump, water pump, an air intake system, exhaust system, starter, large radiator, transmission with four or more gears, differential, on and on, none of which are required in an EV. Apparently a 4:1 range ratio, 400 miles to 100, is the practical ratio today.

[CaptFirePanda]

That conclusion is not justified, especially given the recession was Fall 2008 and imports have has been falling since 2005.

From the plot it is obvious that the numbers have not been in decline since 2005 and looking at the raw data confirms this (with minor dips lasting no longer than a year).

Yes economic slow downs deserve some of the blame for energy imports and consumption, but other factors apply apply including improvements in economic energy intensity and increase in domestic supply:
1. US energy intensity (energy per unit of economic output) has been cut in half since 1980, (http://www.google.com/publicdata/explore?ds=d5bncppjof8f9_&ctype=l&met_y=eg_use_pcap_kg_oe#!ctype=l&strail=false&bcs=d&nselm=h&met_y=eg_use_comm_gd_pp_kd&scale_y=lin&ind_y=false&rdim=region&idim=country:USA&ifdim=region&tstart=319698000000&tend=1266469200000&hl=en&dl=en)and improved 10% the period 2007 to 2010.

I would suggest this is a factor of technology, rather than consumption. As we have seen, consumption has been increasing while production decreasing since 1980.

2. US domestic crude production has been rising since ~2007 (up 1 mbbl/day), as have natural gas liquids (up ~500kbbl/day) (http://205.254.135.24/totalenergy/data/monthly/pdf/sec3_2.pdf)

Definitely an increase (although it is closer to 0.7 mbbl) and much of this can be attributed to the Bakken. Unfortunately, as we know from every other source of hydrocarbon, production peaks and then drops off - moreso with respect to the shale plays as, without constant hydraulic fracturing and drilling, production drops off rapidly.

3. Ethanol production has doubled in the last couple years (see graph from earlier post), now 1 mbbl/day.
Those three things contribute strongly to the reduction in imports and consumption.

They contribute, yes; whether they contribute strongly is a very different thing. They offset some increases in consumption, but they do not come anywhere close to offsetting the historical rise in consumption and the drop in production. Ethanol is, at best, a stop gap and it doesn't account for much of the overall hydrocarbon picture.

A fair point. (http://www.google.com/publicdata/explore?ds=d5bncppjof8f9_&ctype=l&met_y=eg_use_pcap_kg_oe#!ctype=l&strail=false&bcs=d&nselm=h&met_y=eg_use_comm_kt_oe&scale_y=lin&ind_y=false&rdim=region&idim=country:USA:CHN:IND&ifdim=region&tstart=319698000000&tend=1266469200000&hl=en&dl=en) Note though that energy prices have a way to go before they are constant around the world, and exports to the highest bidder immediate. Natural gas for instance is priced overseas at several multiples of the of the US price (for now). Bakken oil sells at a $30/bbl discount locally (for now). I doubt a squeeze in supply meeting demand becomes serious enough to stop a build out in more energy infrastructure.

Think of it as a a feedback loop. In order to maintain supply to match demand, one needs to expend energy. Greater energy must be spent in order to meet greater demand. As production increases, resources are depleted quicker. As resources are depleted, more energy must be expended in order to drill up and find new resources. So, in order for us to keep pace with growing demand, we must spend energy to speed up production and to fill any voids left by depleted resources. We begin to exploit unconventional sources more and more and our dependance shifts from the more conventional sources (which are all on the decline). To get energy, we must spend energy and the energy we need to spend will only increase.

The US is not an isolated case in the energy cycle. Despite any growing supply from within, consumption still outpaces domestic production by about 40% (compared to 20% in 1980). It is quite apparent that new technologies and new discoveries are not abating the US need for imported hydrocarbons. We can nickle and dime the numbers until the end of time, but the long term historical trends are such that the US relies rather heavily on foreign production of hydrocarbons. In order to bridge that 40%, there will need to be some sort of technological epiphany or the fundamentals of geology/thermodynamics will need to be turned on their collective ears. In the face of a huge global shift in energy consumption, the US will need to make some pretty significant strides in the next decade or so.

The depends on the efficiency of the biofuel method and the consumption at the time. That 500 bbl/acre-year engineered bacteria approach (should it work) requires 13 million acres to meet all of US current consumption (18 mbbl/day). That compares well to the 90 million acres in use currently for all US corn crops, not that such an approach needs arable land.

These forms of biofuel generation are still in their infancy. For as long as ethanol has been used and produced in the US, it still accounts for a fraction of US fuel.

[mheslep]

That conclusion is not justified, especially given the recession was Fall 2008 and imports have has been falling since 2005.From the plot it is obvious that the numbers have not been in decline since 2005 and looking at the raw data confirms this (with minor dips lasting no longer than a year).:confused: To what data are you referring?

http://205.254.135.24/dnav/pet/hist_chart/MTTNTUS2a.jpghttp://205.254.135.24/dnav/pet/hist/LeafHandler.ashx?n=pet&s=mttntus2&f=a

[MarcoD]

Energy density is the issue....
http://www.global-greenhouse-warming.com/support-files/biodiesel_deer_future.pdf

The picture on page 11 didn't look too bad to me. Sure, you lose cargo space, but not that much. Is there anything known about the size, or durability, of the engine which would drive a hydrogen based truck?

[CaptFirePanda]

:confused: To what data are you referring?

http://205.254.135.24/dnav/pet/hist_chart/MTTNTUS2a.jpghttp://205.254.135.24/dnav/pet/hist/LeafHandler.ashx?n=pet&s=mttntus2&f=a

This is one of my problems... initially we were discussing consumption, then you jumped to supply numbers and now net imports. There are, of course, subtle differences between them all (nickle and diming, as I mentioned).

So, I'm trying to keep track, but obviously it's just as confusing for me.

[mheslep]

This is one of my problems... initially we were discussing consumption, then you jumped to supply numbers and now net imports. There are, of course, subtle differences between them all (nickle and diming, as I mentioned).

So, I'm trying to keep track, but obviously it's just as confusing for me.

ok, understood.

....

I would suggest this is a factor of technology, rather than consumption. As we have seen, consumption has been increasing while production decreasing since 1980. Well there have been several ups and downs. Here is the consumption data (all liquids) back to '63 this time. (http://205.254.135.24/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MTTUPUS2&f=M) Increase up to the '79 Iranian crisis, decline to ~83 then increase, slight decline in 90-91, and then decline again since ~2006-7.
http://205.254.135.24/dnav/pet/hist_chart/MTTUPUS2M.jpg

Note oil consumption per capita (link up thread) has declined pretty much continuously, showing that more efficient cars/trucks/airplanes/ships, the elimination of oil based electric generation and so on have made a difference in consumption.

Think of it as a a feedback loop. In order to maintain supply to match demand, one needs to expend energy. Greater energy must be spent in order to meet greater demand. ... As resources are depleted, more energy must be expended in order to drill up and find new resources. So, in order for us to keep pace with growing demand, we must spend energy to speed up production and to fill any voids left by depleted resources. We begin to exploit unconventional sources more and more and our dependance shifts from the more conventional sources (which are all on the decline). To get energy, we must spend energyYes I am familiar with the ERoEI concept.

and the energy we need to spend will only increase.I don't agree that it will only increase. Yes tar sands initially require more energy than conventional, but from what I read tar sand production energy is declining especially in the last year. I doubt tar sands production energy costs will ever reach conventional, but neither do I see a runaway energy production problem. More like a step increase.

The US is not an isolated case in the energy cycle. Despite any growing supply from within, consumption still outpaces domestic production by about 40% (compared to 20% in 1980).And compared to ~65% in 2005-6.

It is quite apparent that new technologies and new discoveries are not abating the US need for imported hydrocarbons.One can argue that new production/efficiency is not the entire reason for the closing gap, or that current conditions won't hold in the future, and I'm happy to see those arguments. But as written that statement is simply not true. US oil imports are falling, and have been since 2005, and now so are gas imports. (http://205.254.135.24/dnav/ng/hist_chart/N9100US2m.jpg)

...These forms of biofuel generation are still in their infancy....Yes, and may never go anywhere. I'm simply pointing out that it is not justifiable to say that land use always rules out any kind of way forward for biofuels. I agree land use rules out a corn ethanol future, but not some of the other far more efficient schemes on the table, and which at least don't violate any laws of physics.

[CaptFirePanda]

Well there have been several ups and downs. Here is the consumption data (all liquids) back to '63 this time. (http://205.254.135.24/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MTTUPUS2&f=M) Increase up to the '79 Iranian crisis, decline to ~83 then increase, slight decline in 90-91, and then decline again since ~2006-7.

Looking at the raw data, the decline coincides with 2008 as 2007 shows a fairly decent increase.

Note oil consumption per capita (link up thread) has declined pretty much continuously, showing that more efficient cars/trucks/airplanes/ships, the elimination of oil based electric generation and so on have made a difference in consumption.

This stat can also be atttributed to many other factors that may or may not be at play here (eg. wealth distribution, age distribution, etc...) I'm not saying they would skew the results, I'm just pointing out that overall consumption is still on the rise and it outpaces domestic production.

Yes I am familiar with the ERoEI concept.

I think the idea of the "ERoEI concept" overshadows basic thermodynamics. One can fixate until the end of time on distinct ERoEI values while losing sight of the thermodynamic quandry.

I don't agree that it will only increase. Yes tar sands initially require more energy than conventional, but from what I read tar sand production energy is declining especially in the last year. I doubt tar sands production energy costs will ever reach conventional, but neither do I see a runaway energy production problem. More like a step increase.

The bulk of oil sands production has come from mining operations to date. Along with that, however, are the SAGD operations. These produce volumes much less than mining operations do (on a one to one comparison), but collectively will account for greater amounts of total contribution to oil sands production. These operations require drilling, thermal processes to create steam, pipelining, etc... and are far less concentrated than mining operations. So, even if energy requirements are decling now they will increase again. SAGD operations will likely account for ~80% of bitumen produced throughout the course of oil sands development.

Thus, we can keep adding up incremental steps of energy increase, which may seem somewhat trivial on their own, but become far more significant when viewed collectively. Futhermore, this goes beyond oil sands. It encompasses the full range of unconventional resources. Energy use will never be statci for a certain process (eg. it will likely decrease over time), but we are in a situation where we are finding more and more resources that require greater energy to produce.

And compared to ~65% in 2005-6.

Taking snapshots in time of these sorts of things is misleading. Overall, historical trends are what describe the system best. We do, of course, take anomalies into consideration and determine if they are part of a trend. On their own, however, they are mostly meaningless.

One can argue that new production/efficiency is not the entire reason for the closing gap, or that current conditions won't hold in the future, and I'm happy to see those arguments. But as written that statement is simply not true. US oil imports are falling, and have been since 2005, and now so are gas imports. (http://205.254.135.24/dnav/ng/hist_chart/N9100US2m.jpg)

They are falling, but they have only been falling for the last 2-3 years of a 61 year upward trend. As I mentioned above this kind of aberration does not mean much of anything until it becomes a long-term trend. At the moment, it can be explained away by many other factors.

Yes, and may never go anywhere. I'm simply pointing out that it is not justifiable to say that land use always rules out any kind of way forward for biofuels. I agree land use rules out a corn ethanol future, but not some of the other far more efficient schemes on the table, and which at least don't violate any laws of physics.

I don't think I said land-use always rules out the concept of biofuels (if I did, I apologize). I think I indicated that land-use issues will be an impediment to these sorts of operations. There are many sectors vying for space and it is very difficult to justify large extents of land for low relatively volumes of fuel.

[mheslep]

...
This stat can also be atttributed to many other factors that may or may not be at play here (eg. wealth distribution, age distribution, etc...) I'm not saying they would skew the results, I'm just pointing out that overall consumption is still on the rise and it outpaces domestic production.??? You mean that, what, the average linear consumption trend for the last several decades is up? Sure, but I hope we agree that recently this is not the case, that the recent consumption figures are
US Consumption, 4 wk average, all oil, mbpd (http://205.254.135.24/dnav/pet/hist/LeafHandler.ashx?n=pet&s=wrpupus2&f=4)
Feb 2007 21.8 (all time high US consumption)
Feb 2008 20.6
Feb 2009 19.5
Feb 2010 19.3
Feb 2011 19.4
Feb 2012 18.1
i.e. off 17%, otherwise I'm wasting my time here against some kind of dogmatic belief unchangeable by data.

The bulk of oil sands production has come from mining operations to date. Along with that, however, are the SAGD operations. These produce volumes much less than mining operations do (on a one to one comparison), but collectively will account for greater amounts of total contribution to oil sands production. These operations require drilling, thermal processes to create steam, pipelining, etc... and are far less concentrated than mining operations. So, even if energy requirements are decling now they will increase again. SAGD operations will likely account for ~80% of bitumen produced throughout the course of oil sands development.Perhaps, but in the future we don't know if SAGD will be used over (say) VAPEX (http://en.wikipedia.org/wiki/Oil_sands#Vapor_Extraction_Process_.28VAPEX.29)tha t does not require steam. With very cheap natural gas to make steam no doubt SAGD will continue for awhile, but there's no rule mandating that will be the case.


They are falling, but they have only been falling for the last 2-3 years of a 61 year upward trend. As I mentioned above this kind of aberration does not mean much of anything until it becomes a long-term trend. At the moment, it can be explained away by many other factors.
I respect long term trends. The flip side of long term trends is that reversals never seen before have significance. That's why I see a six year reversal 25% off the peak as significant.
US net imports all oil mbpd (http://205.254.135.24/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MTTNTUS2&f=A)
2005 12.55
2006 12.39
2007 12.03
2008 11.11
2009 9.67
2010 9.44
2011 8.52 (12 month rolling average)


I don't think I said land-use always rules out the concept of biofuels (if I did, I apologize). I think I indicated that land-use issues will be an impediment to these sorts of operations. There are many sectors vying for space and it is very difficult to justify large extents of land for low relatively volumes of fuel.<shrug>I don't know that commercial interests are vying for the vast tracks of barren land in the US, at least they have not so far. Certainly there are groups that want these areas left barren and pristine.

[CaptFirePanda]

??? You mean that, what, the average linear consumption trend for the last several decades is up? Sure, but I hope we agree that recently this is not the case, that the recent consumption figures are
US Consumption, 4 wk average, all oil, mbpd (http://205.254.135.24/dnav/pet/hist/LeafHandler.ashx?n=pet&s=wrpupus2&f=4)
Feb 2007 21.8 (all time high US consumption)
Feb 2008 20.6
Feb 2009 19.5
Feb 2010 19.3
Feb 2011 19.4
Feb 2012 18.1
i.e. off 17%, otherwise I'm wasting my time here against some kind of dogmatic belief unchangeable by data.

I mean the long term trend. Interesting how the all time high winds up shortly before the 2008 dive.

Perhaps, but in the future we don't know if SAGD will be used over (say) VAPEX (http://en.wikipedia.org/wiki/Oil_sands#Vapor_Extraction_Process_.28VAPEX.29)tha t does not require steam. With very cheap natural gas to make steam no doubt SAGD will continue for awhile, but there's no rule mandating that will be the case.

Well SAGD is quite prevalent currently and will continue to be for some time. Whether or not VAPEX ever comes to fruition is up for debate. There are other technologies out there as well, but there is a rather solid line between what is economic and what isn't.

I respect long term trends. The flip side of long term trends is that reversals never seen before have significance. That's why I see a six year reversal 25% off the peak as significant.

Six years reperesents 10% (or less) of the time in which this upward trend has been taking place. It also coincides very well with the most recent reccession (do I sound like a broken record yet?). Listing the early 80's gives you a similar trend, but imports steadily increased until 2008. I see the "reversal" as somewhat short term and a similar return to business as usual will follow.

<shrug>I don't know that commercial interests are vying for the vast tracks of barren land in the US, at least they have not so far. Certainly there are groups that want these areas left barren and pristine.

Whether it is commercial, environmental, social, etc... interests, they will still be at play.

[mheslep]

...I see the "reversal" as somewhat short term and a similar return to business as usual will follow.Yes so I gather, but I don't understand why.

I've cast about for some energy indicator from the '08 recession that is independent of conservation measures and I think I have one. Vehicle Miles Driven is an indicator tied closely (?) to economic output, i.e. the recession. VMD has dropped about 3% since the 2008 recession began, so there is some indication, I think, of the impact the recession had on US oil consumption.
http://www.bts.gov/publications/multimodal_transportation_indicators/february_2012/html/highway_vehicle_miles_traveled.html

That's 3% against an oil import cut of 25%. I'd certainly agree that, should the economy get strong again and unemployment return to normal, the US will see a 3% bump or more of VMD (unless the price of gas goes well over $4/gal). However there are some things that are not going return to business as usual regardless of the economy:

Automobile mpg. New vehicles have improved mpg by 8% since 2007. Fleet on the road is improving mpg ~2% a year. Those vehicles will not return to old mpg figures should the economy boom.
Heating oil cuts by 45%: people in Maine are not going to rip out the insulation and destroy their heat pumps and high efficiency wood stoves to switch back to oil.
Shale oil, Bakken. Like you I don't know how long it will last, but for the next decade or so shale is going to continue to be large, and we can expect other US shale formations to start producing large volumes too. Shale is out of the bottle and won't be put back in.
Shale gas. We will continue to see a million bpd of liquids cast off from gas, at least.
Ethanol. Will continue at the current 1 mbpd, at least
Naphtha for plastics. Has largely come from oil, is now rapidly vanishing and is being replaced by cheap natural gas sourced ethane at 1 mbpd. (http://online.wsj.com/article/SB10001424052970204778604577243632504873636.html)

etc

[CaptFirePanda]

Careful, you've flipped from imports (where the 25% decrease occurs) to consumption (~17%) for comparisons.

I would be, if I had the time or inkling, interested to see what sort of effect this had on the family vacations, and other similar "luxury" things. But this is a little too much "trees" and not enough "forest".

The interesting part is that reduction in consumption is not directly correlatable to use of gasoline or other crude derivatives. In a debt driven economy, when a recession hits keeping pace with debt leads to less and less money for other spending. I'm no economist and I won't pretend to be, but the relationships are far from directly proportional.

You can get bogged down in the minutia, but the simple fact remains is that when a recession hits, oil imports and consumption drop. This isn't something that the general public does in response. This is something that occurs as a result of many other factors.

[apeiron]

IMF researchers have put out a study on peak oil that takes into account the geological contraints on production, plus the technological advances in extraction that can be expected, and are still warning of "a near doubling, permanently, of real oil prices over the coming decade."

See http://www.imf.org/external/pubs/ft/wp/2012/wp12109.pdf

Or that conclusion in a little more detail....

While our model is not as pessimistic as the pure geological view, which typically holds that binding resource constraints will lead world oil production onto an inexorable downward trend in the very near future, our prediction of small further increases in world oil production comes at the expense of a near doubling, permanently, of real oil prices over the coming decade. This is uncharted territory for the world economy, which has never experienced such prices for more than a few months.

Our current model of the effect of such prices on GDP is based on historical data, and indicates perceptible but small and transitory output effects. But we suspect that there must be a pain barrier, a level of oil prices above which the effects on GDP becomes nonlinear, convex.

We also suspect that the assumption that technology is independent of the availability of fossil fuels may be inappropriate, so that a lack of availability of oil may have aspects of a negative technology shock. In that case the macroeconomic effects of binding resource constraints could be much larger, more persistent, and they would extend well beyond the oil sector.

Studying these issues further will be a priority of our future research.

[russ_watters]

So how, in your opinion, does that fit with or contradict the idea of Peak Oil?

[mheslep]

The references cited in this IMF paper make me immediately skeptical, especially Deffeyes and Matt Simmons, as these are not only peak oilers but peak oilers that also feel the need to forecast catastrophe and the collapse of civilization. The paper does not mention any the flaws associated with these authors.

Dr Deffeyes has been called production oil peaks in 2000, 2003, 2004, 2005 at least. Since 2006 has had on his Princeton web site (http://www.princeton.edu/hubbert/current-events-06-02.html):
By 2025, we're going to be back in the Stone Age.

[russ_watters]

Noted, but there are two interesting statements in there that seem to contradict the alarmist view:

1. A "permanent doubling of oil prices" does not fit my understanding of Peak Oil, which afaik predicts a continuous (accelerating?) increase.
2. Small continued supply increases is radically different from an accelerating drop.

These two statement to me paint a picture of no near-term peak oil risk.

What I've been seeing lately appears to be pretty strong contradictions of peak oil. The gist of a recent Time article for example is that there are vast untapped reserves out there that require twice the cost to extract as current reserves. Thus a doubling of the price could cause a decades-long stabilization of oil economics.

[Jimmy Snyder]

By 2025, we're going to be back in the Stone Age.
Assuming they were burning coal in the Stone Age.

[mheslep]

.... The gist of a recent Time article for example is that there are vast untapped reserves out there that require twice the cost to extract as current reserves. Thus a doubling of the price could cause a decades-long stabilization of oil economics.Yes but twice what cost basis? At one point the Saudi's could pull oil for $10/bbl.

It seems to me there are several replacements, using existing technology, that would prevent a price doubling. The first that comes to mind is gas to liquids. The largest plant in the world is Pearl (http://en.wikipedia.org/wiki/Pearl_GTL#Technical_features), in Qatar, which cost $24 billion, and produces 192 thousand bbl oil/day from 1.6 billion cf/day of gas. If the twenty year cost of the plant is $30 billion, then the bbl price amortized over the plant life is $30/bbl, plus the cost of the gas to make a GTL bbl of oil is ~$45/bbl @ $4/1000 cf, so ~$75/bbl is the top price from GTL. Apparently a GTL plant is about to break ground in the US (http://www.northwestbusiness.ca/2012/05/our-own-gas-to-liquids/), brought on by the spread between natural gas and oil prices.

*The IMF authors mention this, but discount them due to 'problems' with the 'elasticity' of 'replacements'.

[mheslep]

Here's another another low cost 'replacement' that negates the price doubling thesis:

RAND predicts the costs [of oil shale production] would decline to $35–48 per barrel ($220–300/m3) within 12 years.
http://en.wikipedia.org/wiki/Oil_shale#Economics