The death of Peak Oil = The death of green energy?

So the USofA is supposed to be energy independent by 2020. That's the forecast by some, that we will have so much oil, that we will be able to tell OPEC to go screw themselves. If this happens, will this mean the death or drastic slowdown of green energy, electric transportation...

I saw this happen with the last energy shortage, or the last artificial energy shortage (Arab oil embargo). When it happened, there was a big push to put solar hot water panels on everyone's roofs, now all those systems are long gone. The moped invasion of the late 70's early 80's, only lasted a few years, as people went back to their old ways.

With the government demanding newer vehicles get better and better MPG and with new technologies making incredible amounts of energy available, can we expect the lackluster E-cars to fail. I don't expect E-bikes to go away, as they are the only real practical electrical transportation. But E-cars have a huge hurdle to leap. Battery technology, charging infrastructure, a public that is comfortable with their ICE powered cars.

Are photovoltaic panels going to be showing up in peoples yard sales piles, $2.00 each. That's how I got my solar hot water panels, at a yard sale. Heck, $100,000.00 jobs go begging in the oil boom towns, unemployment of 3.5 percent. Not a dime of government incentives to convince people that they need to buy a ICE vehicle. No government incentives to drill or invent this new oil boom technology.

Is the end near for green energy.

The end is not near. Green tech is just making incredibly slow gains. But faster gains in recent periods compared to the past. Battery powered vehicles used to be a complete joke / total pipe dream just 10 years ago. Nowadays, we're seeing acceptance of them finally.. and better.. the Tesla Model S was named car of the year by motor trend..

Yes, government does stupid things. Like continue oil subsidies and wars, and simultaneously subsidize electrics.
Push companies to make electric cars - then raise CAFE so that gas cars are cheaper to operate.
You can't expect them to help. It's the industry's job to find a solution.
We need better batteries, period.

Don't lose hope of electrification, it will come in time. Your kid's RC 'copter is electric and is more fun to play with than a gas RC 'copter. He sees electric cars on TV. He might even think that ebikes are really cool. He won't have that awful experience with ni-cad and lead acid batteries. Maybe he'll even appreciate the sound of an astro motor spinning up to full tilt rather than the sound of a V8

deronmoped said:

I saw this happen with the last energy shortage. . . .

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That says it all.

There will be no energy independence in 2020. Obama will pout and point the finger for four years then the jackasses that voted for him will give him the finger. By 2017 we will have all the $10/gallon gas we can pay for, thanks to Obama voters. Only the lack of jobs will curb use. As he slinks off in humiliation, he will at last put words to what we've always known he was thinkng: "I hate you all, I hope you DIE!!!!"

Electric cars will be catching fire on the freeway with greater frequency, because there'll be more of them. Tow trucks will be big business. Federal, State, Municipal laws will fine you and fine you for failing to meet their precious goals, politicians will berate you on the floors of their legislative houses and vote themselves free gas. Cars that DON'T get the mandated fuel mileage will be what is for sale on the car lots.

And there'll be new laws requiring American energy independence in 2040 passed in China, with stiff penalties if we don't make it this time. . . .

It does kind of remind you of the 70's shortage, which was purely political in origin. This time really smart people have manipulated the market in a much more subtle way, resulting in a more permanent increase in prices. So now, as then, new technology gets developed to make extraction of more expensive sources profitable.

Threre are other similarites to the 80's as well, during those years we forgot all about saving energy we were in a deep recession. So we tended to want to save our money and not buy any new cars big or small, or any home improvements. It was during the 90's that we really started upsizing the car and the house. By then oil had gotten cheaper compared to your income than ever. Same thing this recession, once you start worrying about this months house payment enough, screw the enviroment.

But this time around there really has been a large global increase in the use of oil, so it will tend to get higher and higher in price with less tendency for the market to crash to low prices as it has so many times in the past.

It's not really a peak oil thing at all that drives the green movement. Green is just something most people get interested in when you have extra money you can afford to spend on luxuries. Then it becomes a style and a status symbol to have shit on your roof.

Many of us here of course, are the 1% that is driven by a true concern about the enviroment, or maybe are just that frugal that we dig really economical transportation.

There Will Be Oil, But At What Price?
by Chris Nelder and Gregor Macdonald | 11:26 AM October 4, 2011
Harvard Business Review

Daniel Yergin's typically sunny outlook on oil in his recent Wall Street Journal piece, "There Will Be Oil," suggested that technology and new energy discoveries would avert any of the economic disasters portended by peak oil. We found Mr. Yergin's dismissal of these risks premature and repetitive. After all, he has asserted since 2004 that global oil production was nothing to worry about, and that there would be few effects on the economy.

We counter that managers who would see their businesses survive the next few decades of extreme economic volatility will need to develop some literacy about oil and its complex relationships with the economy. They would be wise to consider the long list of peak oil analyses by the world's militaries, and they would take heed of the sobering outlook offered by veteran analyst Robert Hirsch for the Department of Energy. And we must correct some of Mr. Yergin's assertions.

Conventional crude ended its 150-year-long growth trajectory in 2004 and flattened out around 74 million barrels per day. Crude supply did not budge when oil prices tripled from 2004 to 2008, but global demand remained firm, shrugging off a recessionary dip in 2009. All the growth in supply since then was not crude but unconventional liquids, including natural gas liquids, biofuels, refinery gains, synthetic oil from tar sands, and other marginal resources. These liquids are by no means equivalent to crude. Yergin's calming charts include these unconventional liquids and hide the fundamental issue of the depletion of mature fields. They also hide the declining energy density, higher cost, and lower flow rates of these new resources.

As Shell, Chevron, Total, the IEA, and a host of other serious observers have openly declared since 2005, the age of cheap and easy oil has ended. The "oil" that's left is progressively expensive, difficult, risky, marginal, and fraught with secondary effects like increasing carbon emissions, demand for water, and competition with food.

A wide spectrum of agnostic analysts with decades of distinguished service in the oil industry and its press have addressed this. We like the formulation of petroleum economist Chris Skrebowski, which defines peak oil as the point where "the cost of incremental supply exceeds the price economies can pay without destroying growth at a given point in time."

The connection between oil shocks and recessions has been understood for decades. We have ample historical evidence that when petroleum expenditures reach 5% of GDP, recession typically follows. Annual energy expenditures rose from 6.2% of U.S. GDP in 2002 to a painful 9.8% in 2008, which was immediately followed by an economic crash. And now oil is sending energy expenditures back above 9% of GDP, just as we see fresh indications that the recession persists. This is not a coincidence.

It's difficult to tease the oil price signal out of the concurrent financial crisis and opportunistic speculation, but it would be a grave error to think it had no effect on the economy. Indeed, we believe it was, and remains, the most important fundamental of our present recession. On the plateau of oil supply, prices are trapped on a narrow ledge. Economic growth requires more oil, which requires high oil prices, which in turn undermine economic growth. And that ledge is getting narrower. We know that the economy fell on its face at $147 per barrel in 2008, and brought growth to a halt in 2011 at $120. The new pain tolerance limit appears to be $90 in the U.S., but $100-110 in China. At the same time, it costs $80-90 to bring a new barrel of supply online from marginal resources such as deepwater, tar sands, and the Arctic.

Yergin wants to have it both ways: He wants us to believe that the market will bear the high prices required to keep supply increasing against the backdrop of mature fields — which are declining by 5% per year — while at the same time asserting that prices will remain low enough to engender continued economic growth. This, we submit, is impossible.

Peak oil poses a host of systemic risks to the global economy, and will increasingly disrupt supply chains in our globalized world. Contra to Yergin's view that Ricardian Comparative Advantage will produce abundant oil for export, oil-producing nations will continue to feed their domestic populations, leaving less for sale on world markets. OECD consumers will be increasingly priced out of oil markets as their disposable income adjusts downward to reflect energy costs.
http://blogs.hbr.org/cs/2011/10/there_will_be_oil_but_can_you.html


The U.S. government should reallocate funds currently spent on mature energy technologies toward research and development for alternative technologies at the early stages of development. In the context of serious fiscal reform, it should also gradually raise taxes on gasoline and diesel (while compensating for those hikes by lowering payroll taxes). This shift would not only discourage consumption (while rewarding work); it would also shield consumers from price volatility: if taxes accounted for a larger fraction of the pump price of gasoline and diesel, swings in the underlying price of crude would be less consequential. Such taxes have been politically toxic in the past, but they may be more palatable than many of the other options that would be considered in any serious budget debate.
http://www.foreignaffairs.com/articles/67890/robert-mcnally-and-michael-levi/a-crude-predicament

I agree that there is no way the USA is going to become energy independent within 10 years, at least not without a radical shift in behaviour.

dogman said:

Many of us here of course, are the 1% that is driven by a true concern about the enviroment, or maybe are just that frugal that we dig really economical transportation.

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I think we're here simply because we're all "out of the square" type of people.

The last ten years there been a lot of focus on the Bakken field in North Dakota/Canada. When that dries up, there is another deposit in NW Colorado called the "Green River". 720-Billion barrels roughly, but its the hard-to-extract shale kind. Its near an aquifer (don't want to contaminate it) but the shale-oil extraction methods currently used are water intensive, so...

http://oilshalegas.com/greenriveroilshale.html

I'm guessing fuel would have to be $8+/gallon before there would be enough pressure to overcome the reistance to extracting that oil. It might take a contrived global crisis/war for emergency powers to be in effect (bypassing congress). But, yes...even though the "low hanging fruit" has pretty much already been harvested, there actually still is a lot of oil around.

Green river is a beautiful place. Probably the most scenic area of all Wyoming. I believe some of the water we get here in Utah comes from there. I really hope they don't tear that place up.





The worst part of peak oil is the environmental destruction involved. I'm not talking carbon numbers, i'm talking about the sheer amount of water they end up poisoning in order to frack and process tar sands.

Nep, you've been in SLC all this time and I never noticed.

I have a ton of family there. Mormons, going all the way back to the beginning, including Smith, Illinois, SLC, etc. interesting story. I like SLC.

About Peak Oil. We'll eventually change our personal behavior in terms of transportation and oil will be for fueling other projects.

We'll be okay.

IMF study: Peak oil could do serious damage to the global economy
Posted by Brad Plumer on October 27, 2012 at 12:44 pm
Washington Post

The world isn’t going to run out of oil anytime soon. But there’s still concern among various geologists and analysts that our oil supply won’t grow as quickly or as easily as it used to. We’ll have to resort to harder-to-drill oil to satisfy our crude habits. More expensive oil. That would push prices up. And high oil prices could act as a drag on growth.

This, at any rate, is the basic idea behind “peak oil.” And there’s some reason for worry. Between 1981 and 2005, world oil production grew at a steady pace of about 1.8 percent per year. All was well. But starting around 2005, oil production appeared to plateau. And, since demand for oil kept rising, especially in countries like China and India, that caused prices to soar. Oil doesn’t get much cheaper than $100 per barrel these days. And that, some economists worry, has acted as a drag on growth around the world.

So how bad would it be if peak oil was really upon us? That’s a question that two IMF economists try to tackle in a new working paper, “Oil and the World Economy: Some Possible Futures.” (pdf) The authors, Michael Kumhof and Dirk Muir, don’t make any definitive predictions about how the oil supply will evolve. Rather, they try to model a number of different scenarios in which oil does become more scarce and the world tries to adapt.

The paper itself offers an interesting look at how the world might cope with higher oil prices, so let’s take a look at the various scenarios:

1) Oil production grows very slowly or plateaus.

• This is the baseline scenario that Kumhof and Muir use. They assume that oil grows by about 1 percentage point less each year than its historical average. So, let’s say, oil grows at a steady 0.8 percent per year rather than the 1.8 percent annual average between 1981 and 2005. This isn’t a temporary oil disruption like the one we saw in 2008. It’s a persistent, long-term supply shock.
  
  What would happen? Oil prices, the IMF model suggests, would gradually double in 10 years and quadruple over 20 years. Regions that import oil on net, such as Europe and the United States, would see a small hit to growth—about 0.2 to 0.4 percentage points each year. Countries that export, like Saudi Arabia, would get a lot wealthier.

2) Oil production grows at a slower rate, but the world adapts fairly easily.

• In this scenario, oil production declines, but countries start switching to electric cars or fueling their vehicles with natural gas. Vehicles and manufacturers become more efficient. In economist terms, the “elasticity” of demand quickly increases.
  
  Under this scenario, the United States and Europe take just a small hit to growth, about 0.1 to 0.2 percentage points per year. Japan and Asia actually get a boost to their economy, since they can adapt to higher oil prices and export more stuff to oil-producing countries in the Middle East. All told, this is a fairly happy outcome.

3) Oil production grows at a slower rate, but the world can’t find substitutes.

• As the IMF authors note, it’s not assured that the world can quickly adapt to steadily increasing oil prices. Oil is, after all, quite valuable and hard to replace. Electric cars may not catch on. It’s tough to build infrastructure for natural-gas vehicles. The chemical industry might struggle to find substitutes for oil as feedstock. The oil substitutes that result turn out to be lower-quality. In this scenario, wealthy regions like Europe, the United States, and Japan take an annual GDP hit of 0.4 percent to 0.6 percent. That starts to hurt.

4) Oil turns out to be far more important than most economists had assumed.

• The Energy Information Administration estimates that petroleum purchases make up just 3.5 percent of the U.S. economy. Looked at from that angle, expensive oil shouldn’t do too much damage. But, the IMF authors note, several books and articles have pointed out that this understates how crucial oil is to the functioning of a modern economy. Many key technologies contain materials or use fuels derived from crude.
  
  If, in fact, oil is much more important than many economic modelers have assumed, then the blow to growth from even a modest plateau in oil could be quite large—lowering growth rates by up to 1.2 percentage points over the next two decades.

5) Oil production starts shrinking rapidly.

• This is the doomsday scenario. Some studies have suggested that global oil production is currently on a plateau and will soon start shrinking in by around 2 percent per year. Existing wells will dry up. The world will increasingly rely on oil from places that are more expensive to develop, such as Canada’s tar sands. What happens then?
  
  Nothing good. According to the IMF’s modeling, prices could increase by 800 percent over two decades. Growth rates in Europe and the United States would be reduced by at least a full percentage point—and much more if oil turns out to be more important than we thought. “Relative price changes of this magnitude would be unprecedented,” the authors note, “and would almost certainly have nonlinear effects on GDP that the model is not able to capture adequately.” Yikes.

In any case, these scenarios aren’t easy to model—especially since nations might respond in unpredictable ways. (If crude output started shriveling, some oil producers could start restricting exports. Or fuel subsidies could affect demand elasticity. ) All told, however, the IMF authors say it’s quite possible that a decent-sized decline in oil production could have “dramatic” effects that could prove very, very difficult for the world to adjust to.

http://www.washingtonpost.com/blogs/wonkblog/wp/2012/10/27/imf-study-peak-oil-could-do-serious-damage-to-the-global-economy/

I believe that a lot of people don't realize, that the cost of oil is not all about how hard it is to get out of the ground, or demand side of it. Inflation is a huge factor in the cost of oil. The way the fed is printing dollars, pretty soon a loaf of bread will be $1,000.00. Inflation is kicking our ass, our wages are not keeping up. So when you go to fill up, how much of that increase is due to increased cost of extraction, demand and how much is due to inflation. I know my wages are the same as they were, when adjusted for inflation, as 25 years ago

Anyways, I'm all for us being energy independent. It would do us a World of good to not have to spend trillions on military to keep the flow of foreign oil coming in. And, maybe, we could be like the people in Alaska, get a check every year, $$$, for our share of the mineral rights.

spinningmagnets said:

I'm guessing fuel would have to be $8+/gallon before there would be enough pressure to overcome the reistance to extracting that oil.

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Which hopefully means it is never going to happen because by the time oil reaches $8 per gallon, electric cars will be economical.

I'm with neptronix, it would be a real shame!

I'm glad that we're at the point that electric cars are finally better than gas powered cars. Hopefully they'll come down in price enough, gas will go up in price a lot, and we won't burn all of the gas that's left. It's time for politicians and the general populace to listen to scientists saying that mining more gas and coal will help the economy a little, but will provide a swift destruction of the natural environment via climate change. I have a feeling that this will be worse for the economy in the long run.

fizzit said:

I'm glad that we're at the point that electric cars are finally better than gas powered cars. Hopefully they'll come down in price enough, gas will go up in price a lot, and we won't burn all of the gas that's left. It's time for politicians and the general populace to listen to scientists saying that mining more gas and coal will help the economy a little, but will provide a swift destruction of the natural environment via climate change. I have a feeling that this will be worse for the economy in the long run.

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What have you been smoking?

If E-cars are better then ICE cars, why is no one buying the E-cars. (Nissan just revised there sales forecast for the Leaf, sold less then half of what they hopped for this year). Maybe you can get out there and convince the rest of the World that they should junk their ICE car and go buy a battery powered car. Come back with your declaration when battery technology has gotten ten times better and they have the infrastructure to charge your car in place.

Someone wishing for gas to go up in price has no idea what that would do to the rest of the economy. Every time there is a increase in fuel costs, everything else you buy goes up correspondingly. Your "goes up a lot" will not only apply to gas, but to food, electronics, entertainment, travel... Cars are not the only thing that depends on oil. Try buying a ticket to fly anywhere when fuel costs have "gone up a lot".

As soon as you go back to living like your stone age ancestors did, then I will believe you about being serious about GW. Put your GW practices where your mouth is.

Nissan CEO abandons '2012 electric vehicle sales target

From The Detroit News: http://www.detroitnews.com/article/20121115/AUTO0104/211150461#ixzz2CMUVRHNa

I wonder if they did a survey on why people are not buying them, what the reasons would be.

1) Cost.
2) Range anxiety.
3) No place to charge them.
4) New technology anxiety.
5) Fuel savings does not pencil out.

deronmoped said:

What have you been smoking?

If E-cars are better then ICE cars, why is no one buying the E-cars.

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Because they are too expensive, the charging infrastructure is not in place for long distance trips, and there is a negative stigma and ignorance surrounding them. Those are really the only reasons. I did not say that the charging/refueling network was better, or where it needs to be right now. However, that doesn't matter as much unless you take long roads trip often. When I say electric, I mean the Tesla model S. That is what I am referring to. However, the Nissan Leaf is still better than a gas powered car.

Someone wishing for gas to go up in price has no idea what that would do to the rest of the economy. Every time there is a increase in fuel costs, everything else you buy goes up correspondingly. Your "goes up a lot" will not only apply to gas, but to food, electronics, entertainment, travel... Cars are not the only thing that depends on oil. Try buying a ticket to fly anywhere when fuel costs have "gone up a lot".

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We will be back to living in the stone age anyways, if we don't get our butts in gear. You are correct that things will go up in cost, but the long term cost is far greater if we just continue on our path towards disaster.

Do you not want to cause death and pain? Do you not want to support people that disagree with you? Because I won't believe you until you stop participating in the world economy. Everyone is a hypocrite on some level. Deal with it.
One can help prevent global warming without any sort of "stone age" living. For example... riding an electric bike instead of driving, and driving an electric car.

fizzit said:

One can help prevent global warming without any sort of "stone age" living. For example... riding an electric bike instead of driving, and driving an electric car.

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Right! there are plenty of ways to live on far less fossil fuels/energy. Technology gives us these interesting solutions:

+ electric bicycles / trikes / velomobiles capable of very high efficiency.
+ aquaponic fish/vegetable growing systems, which are closed loop systems that don't require chemical fertilizers and produce very little water waste.
+ at high elevations, 'earthship' style house building can produce a house in places like Colorado, Utah, and northern New Mexico which require almost no heating or cooling whatsoever.
+ how about living at middle latitudes like John in CR? :lol: he probably runs a few 100 watt fans in his house during the day, and that's all the climate control he needs out there. You down to wear sandals and shorts all year? :lol:

So these 3 things can cut your fossil fuel usage the most. Your transportation, your consumption of food, and your house heating/cooling are where you use carbon the most.

deronmoped said:

If E-cars are better then ICE cars, why is no one buying the E-cars. (Nissan just revised there sales forecast for the Leaf, sold less then half of what they hopped for this year). Maybe you can get out there and convince the rest of the World that they should junk their ICE car and go buy a battery powered car.

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Hybrids: the gateway drugs to full-on EVs.

"During October [2012], its first full month in the market, 3,182 [Ford C-Max Hybrid] units were sold, outselling the Prius v by more than 400 units, which had ranked as the fourth most sold hybrid in the previous months. Sales of the C-Max Hybrid also led Ford to achieve its best October hybrid sales month ever with a total of 4,612 sales, up 142% over October 2011. Ford reported that 25% of C-Max Hybrid sales took place in California, with Los Angeles and San Francisco as the top selling regional markets."

http://www.greencarcongress.com/2012/11/cmax-20121102.html

I work for a huge oil corporation. The new tech for extracting oil is amazing. I am sure that even with Obama in power we will become oil independent as well as being a natural gas exporter in a few years. Just discovered is the green river formation . "The Green River Formation contains the largest oil shale deposits in the world. The 213 billion tons of oil shale contain an estimated 3 trillion US barrels of shale oil, up to half of which is estimated as recoverable or about equal to all the entire world's proven reserves"~ Wikipedia. No wonder they haven't given me a day off in 63 days.

Most of the hydraulic fracturing is done in the biodiesel wells to extract soybean oil from the earth. It is natural.

boppinbob said:

I work for a huge oil corporation. The new tech for extracting oil is amazing. I am sure that even with Obama in power we will become oil independent as well as being a natural gas exporter in a few years. Just discovered is the green river formation . "The Green River Formation contains the largest oil shale deposits in the world. The 213 billion tons of oil shale contain an estimated 3 trillion US barrels of shale oil, up to half of which is estimated as recoverable or about equal to all the entire world's proven reserves"~ Wikipedia. No wonder they haven't given me a day off in 63 days.

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keragen can not be fractured any more than can the oil sands. you guys have no clue, even if you do work for the worlds largest oil company.

multistage hydraulic fracturing has nothing to do with the green river formation and it has nothing to do with the oil sands recovery operations in alberta.

it is not like it is hard to go study and learn something if you wanna criticize other people. at least they made the effort to educate themselves and learned how to fracture the shale.

TylerDurden said:

"During October [2012], its first full month in the market, 3,182 [Ford C-Max Hybrid] units were sold, outselling the Prius v by more than 400 units, which had ranked as the fourth most sold hybrid in the previous months. Sales of the C-Max Hybrid also led Ford to achieve its best October hybrid sales month ever with a total of 4,612 sales, up 142% over October 2011. Ford reported that 25% of C-Max Hybrid sales took place in California, with Los Angeles and San Francisco as the top selling regional markets."

http://www.greencarcongress.com/2012/11/cmax-20121102.html

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Hmm,..not that a few thousand sales is very significant considering the size of the market,..but I wonder if those figures would be the same if there were no rebates available ?
how much has that "success" cost the taxpayer ?

ot like it is hard to go study and learn something if you wanna criticize other people.

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Who was criticizing, you dumb bitch.

Hillhater, what's the deal? knowing that the money you pay in taxes ( or at least maybe, your children will pay in taxes ) go to help a middle class person get a fancy car that they can run off coal instead of oil doesn't give you the warm fuzzies?

..meanwhile we ride electric bikes and haven't asked any money to help finance them.. let's get in on this game! government is just a big pile of money you can use to steal from other people after all!

( ya, i'm being sarcastic in case you couldn't tell. )

Hillhater said:

TylerDurden said:

"During October [2012], its first full month in the market, 3,182 [Ford C-Max Hybrid] units were sold, outselling the Prius v by more than 400 units, which had ranked as the fourth most sold hybrid in the previous months. Sales of the C-Max Hybrid also led Ford to achieve its best October hybrid sales month ever with a total of 4,612 sales, up 142% over October 2011. Ford reported that 25% of C-Max Hybrid sales took place in California, with Los Angeles and San Francisco as the top selling regional markets."

http://www.greencarcongress.com/2012/11/cmax-20121102.html

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Hmm,..not that a few thousand sales is very significant considering the size of the market,..but I wonder if those figures would be the same if there were no rebates available ?
how much has that "success" cost the taxpayer ?

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neptronix said:

Hillhater, what's the deal? knowing that the money you pay in taxes ( or at least maybe, your children will pay in taxes ) go to help a middle class person get a fancy car that they can run off coal instead of oil doesn't give you the warm fuzzies?

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That is a pretty ignorant thing to say. Starting with the fact that you obviously don't understand what a hybrid is.