Yes, the dire predictions haven’t yet materialized. It’s a combination of things. The shale “miracle” has temporarily driven down the cost of oil. However, the price of oil is highly dependent on the marginal cost of supply. Consumption doesn’t radically scale with price so if you can boost production slightly above demand the price plummets.
Ordinarily the OPEC countries would reduce production and get the price back up. They haven’t done so. It wouldn’t take much of a cut in production to drastically increase price. The reduction in revenue from selling less would be more than offset by the higher price they get for what they would sell. Besides, they would be able to sell the oil they save at a later date and get even more income. Personally, I believe various geopolitical factors have prevented that: principally the desire of those in control to destabilize Russia and Venezuela. They’ve failed at the first, they may be successful with the second. Just my opinion.
As for the looming crisis, the longer we artificially reduce price by subsidizing shale oil production with printed money the bigger the pain will be when the shale oil finally does run out. It won’t be pretty.
That said, the folks talking about the crisis do miss the fact that massive price increases will cause a reduction in demand (people will lose jobs, there will be serious relocation, society will break down, etc.) This will likely cause prices to drop again. They won’t stay down. The most likely scenario is a cyclic behavior in price with an underlying increase each cycle.
LesPhelps posted graphs from Limits to Growth above (I’ve posted them in other threads). They predicted the crisis around 2020. So far their projections have been amazingly prescient (the book was written in 1972). Based on how things look here in 2018 they may have nailed it.
Based on their graphs 2020-2025 is going to really suck.
Even if we manage to build out enough renewables to go from 2% to 25% of current energy consumption, where will the energy come from to renew the renewables every 25 or so years ? Ans. We can’t when all the fossil fuel is gone.
The only possible reason to roll out renewables @ eroei > 1 is to give us extra time in which to voluntary reduce our population to our long term (sans fossil fuel) carrying capacity, something that mankind refuses to countenance.
Peroron: …an energy crisis was just around the corner…first it was 2010, then 2012 then 2015 now we are here in 2018 and the trains seems to continue on. Can anyone tell me why this seems to be the case?
Heh. Yep, it’s human nature. Facts don’t matter; we never let “data-driven” failed predilections get in the way of making new ones!
Look, this claim of a future energy crisis goes back to the 1970s, and the corresponding stockpiling of beans, bullets, and gold. Nothing has changed since then (except a lot of people got rich).
What is really interesting? How much economic growth has occurred since then due to technology advancement. For example, China has pumped more cement in 4 years (2011-13) than the US did in the entire 20th century. The world has never been so wealthy, nor lived so well, as today.
More interesting? We in the US should be the very last people to be concerned about energy, since we have so many natural resources (especially energy resources). Coal, NG, nuclear, etc. We’re the breadbasket. In the event of a real crisis we will have ample warning as the resource short nations like Japan, England, Germany, etc. will look like Venezuela long before the US looks like Mexico.
Even more fascinating? Most of the US energy dependence is wasted on unneeded transportation! We could just get out of the suburbs and start living close to town, or use NG cars, or use public transport - hell, we could cut our oil usage in half without even trying very hard or impacting GDP.
I could go on and on, how the internet is probably more important than the printing press for economic growth, how information technology allows us to cut back on consumption without loss of quality of life, how the US has already peaked in electric consumption a decade ago, how we could all plant gardens rather than lawns and live healthier than we do now…but this would ruin the beans, bullets, and gold romance, right? Which I confess I enjoy myself :-)…
MKI-
I could go on and on, how the internet is probably more important than the printing press for economic growth, how information technology allows us to cut back on consumption without loss of quality of life, how the US has already peaked in electric consumption a decade ago, how we could all plant gardens rather than lawns and live healthier than we do now...While you are going on, could you tell us the amount of time it would take for everyone to transition to the new lifestyle you describe? And while you're at it, describe what happens during this transition period. I'm sure it's all puppies and ice cream, flip a switch, it happens overnight, right? I'm going to suggest it is exactly during this transition period that we need the beans, bullets, and gold. Here's the thing. Its easy to paint a picture of where nirvana is. It is a bit more difficult - and is the job of a responsible engineering manager - to nail down the task list, cost, and schedule for each item on the list. As a former engineering manager, you sound exactly like my optimistic crew of engineers that imagined they could get just about anything done in about two weeks. Of course when I got them to break the task list down, it turned into a six month schedule. You do know that people need to eat every single day during this transition, right? Just curious - were you ever in management? Did you ever have a budget, a crew of people working for you, were you responsible for delivering the project on time? If you have this skillset - it isn't even slightly evident in your posts!
Cuba experienced just a collapse. Theirs is called the Special Period where petrol became unobtainium. It’s a quick and easy study. I study their agricultural changes to influence My farm management.
check it out, Robie
Great interview, and thanks for the links at the end to join the group.
I think one of the reasons there is little interest in this in the mainstream is that people have lost faith in academia. I have even heard people say on forums (forums on which people understand that the system is failing) that we should now have less emphasis on science because it has failed us!! Instead we should bring in more <I’m not sure what> ? The problem is that science education is so poor these days and people just don’t understand what science is and how it works. I think people think that science is about complex math and stuff they can’t understand, but science is actually just a method of sorting through the world and testing hypotheses to see what isn’t true, and from this we are left with what we PRESUME to be true (until it can be disproven). So science is more relevant today than it ever has been. I think what is happening is that people are actually mistaking the complex jargon and math of economics as science, which could not be further from the truth. Science is clearly pointing out that most economics is complete nonsense. There was the technocratic movement in the early 1900’s which aimed to replace politicians and economists with scientists and engineers but it hasn’t held much traction. I guess we are its modern form.
And thanks for the specifics on EROEI for solar. I have been wondering what it is, I’ll look into it more. My first impression is that you should not include the energy needed for the labour to install it because we are talking about how much energy solar panels provide to society as a whole versus if they weren’t installed and society kept on “keepin’ on” without them. And the guys (and gals) who install these things aren’t just brought into existence for the purposes of installing solar panels, then they disappear from the world again afterwards. They would need to be fed and supported regardless of whether they install solar panels or did something else. So I think the crucial part of doing accurate EROEI calculations is to be very careful about what is included and what is excluded in the calculation, exactly comparing what the input energy situation is with them, versus without them. I don’t think simply just tallying up all the receipts for a project and converting this into an equivalent energy number is a very robust way to do this, especially since my gut reaction says that a lot fo the money in society is “recycled” through velocity so I’m not sure they can all just be arithmetically added to each other. But it will be interesting digging into the specifics of this to see what I come up with.
DFT: If you have this skillset - it isn’t even slightly evident!
No need to be personally disparaging. I was just answering peroron2000’s question (a relevant one that everyone else here just ignored). If you see something specifically wrong with my answer, address it.
DFT: Did you ever have a budget, a crew of people working for you, were you responsible for delivering the project on time? If you have this skillset - it isn’t even slightly evident!
Sheese. If it makes you feel better. Yes. But this has nada to do with my points.
While you are going on, could you tell us the amount of time it would take for everyone to transition to the new lifestyle you describe? And while you’re at it, describe what happens during this transition period.
First, a war (say 1941), dirty bomb (say 9/11), or disease (say flu 1918 style) is more likely to create rapid economic havoc than some “sudden” crisis due to energy. But assuming said energy crisis occurs? It’s pointless to predict, and the US is in the ideal position to hunker down and self-sustain until we re-adjust to the “new normal” anyway, which would almost surely be better than 99.9% of how humanity has lived to date. I’m not speaking theoretically: I live at 1/10 GDP by choice right now. Try it: Walk don’t drive. Hunt. Fish. Garden. Gather. Own a small home with a hand pump well. As CM would say: focus on being. Then invest in our growing economy without fear (keep 10% in physical gold just in case). Hell, it’s just money and life is too short to live in fear.
No need to be personally disparaging. I was just answering peroron2000's question (a relevant one that everyone else here just ignored). If you see something specifically wrong with my answer, address it.Right. You interpreted my criticisms as personally disparaging. They aren't. Personally disparaging comments would look something like this:
- "You're an idiot"
- "You are clueless"
- "You haven't the sense that God gave an ox."
Does anyone besides me see a need to correct the Crash Course section on EROEI https://peakprosperity.com/video/85855/playlist/92161/crash-course-c….
The EROEI for solar in the chapter is given at 21:1 and for wind 30:1. In light of this interview perhaps someone should revisit and revise the material in that chapter. Or maybe dispute the numbers presented in the interview.
MBC: people won’t have jobs, so they can “hunker down” all they like but they won’t be able to feed themselves.
Many can’t feed themselves nor find jobs right now - ever notice the number of people on public assistance? This doesn’t change the fact America is the world’s largest food exporter! We also have lots of NG for fertilizer, enough for the rest of our lives. So if we get into trouble with our bread and circuses? Well, the rest of the world will be in full fledged civil war by then. So in this supposed crisis the US will merely continue to hand out free food to people who don’t have jobs. Same old same old.
MBC: you have a skewed understanding of how modern society work
My “understanding of how modern society works” is exactly what allows me to live differently. Look, this isn’t debatable: I’ve been empirically proven accurate on this subject over the last three decades (to my profit). It’s my interlocutors who have something to prove. But there is certainly nada preventing others from doing the same except sloppy ways of thinking leading to poor understanding. Especially the 20 million in LA; what a great climate and opportunity for anyone with the right way of thinking (which is in very short supply today, I’m afraid). Every location has it’s strengths and weaknesses; it’s the people and their thinking that are the problem. It’s why Japan is rich and Venezuela is poor. One is resource poor yet smart and hardworking, while the later is resource heavy and dirt poor. It’s not about resources. It’s about understanding, which is the most important “resource” a people has.
Hi Chris
I agree that EROEI for solar panels is not as great as it might be but I’m not convinced by these sceptical figures (and note that the paper seeks to make disparaging comparisons of PV versus nuclear generation). Even if we accept energy costs like 505kWh/m² for invested labour (and that means about 500 man-days of work per square metre or 800 days for a standard 1.6 x 1m panel because one kilowatt-hour is about what a fit labourer can output during a working day), the output figures that I am achieving on my small home array is significantly more than 2M2Wh/m² noted in the extract above.
I have 17 panels rated at 185W (Sharp NU185) measuring approx 1m by 1300mm, or about 1.3m² each and therefore a total of 22m². Installed in Jun 2011, they have averaged over 2M7Wh per year or over 120kWk/m² per annum. Even if the 2M66Wh/m² figure is correct for the embodied energy, that is a payback period of 22 years, which is fine. They have shown no measurable performance drop-off to date and are guaranteed to produce at least 90% of rated output by year 20 (from memory). I fully expect them to last at least 30 years, by which time the EROEI will be over 1.3. I know that this is not great but it is certainly not less than unity as Ferroni & Hopkirk’s paper tries to make out.
Gas (and other fossil fuels) have been (and still are) significantly subsidised, which is why gas turbines have been a cheap way of producing electricity. Wind and solar (along with the other ‘renewables’) have no fuel cost, which is why new installations are almost certainly better value (using whatever metric) than fuel-burning generators.
If I were you, I would ask around for other quotes as $3.20/Watt installed is too expensive and you should be able to get better than that; certainly under $2/W.
Solar PV is a reasonable investment as you say and solar thermal even better.
Rev Malthus was incorrect in his analysis and the problem is not the number of people on the planet, it is the consumption and waste of [some] people.
Check out: https://overpopulationisamyth.com which robustly analyses the various arguments around overpopulation and debunks them.
Until we are all thinking more carefully about what we eat (whether it embodies fertiliser and fossil fuels), buy, how we work, travel and live, we can’t be pointing the finger at others saying that they shouldn’t exist.
An interesting part of the discussion was when Dr Hall started adding in ‘fudge factors’ to correct for the fact that electricity is more useful than many other forms of energy and therefore the EROEI needs to be adjusted accordingly. This is exactly what Exergy tries to account for. In a practical sense, it’s much harder to use but in these types of analyses is much more meaningful.
Exergy takes account of the entropy and evaluates the usable content of the energy. Hence, 1kWh of electricity can achieve more than 1kWh of oil or gas, which in turn is more useful than 10 litres of boiling water, which is more useful than 100 litres of tepid water.
This is how heat pumps achieve their ‘magic’ of providing two to seven kWh for each kWh input. This is also why electric vehicles can travel three or four times as far with 36 kilowatt-hours of charge as an internal combustion engine car can drive on a gallon of petrol.