Power Laws, Bell Curves & The Death Of Rationalization - Energy Bulletin [View All]

[hatrack]

Interesting article.

EDIT

The structures of these two types of networks (the highway network as described by the normal distribution and the air network as described by power laws) are thus very different. Which brings us to the concept of peak oil, centralization and localization. In former times, slaughterhouses, bakeries, breweries and dairies were small, numerous and more or less evenly distributed across the country (just like roads are). Now they are big and they are located to only to a few places. According to the Swedish National Food Administration there exist (only) 25 “large-scale slaughterhouses” in Sweden that they oversee (and some of these slaughterhouses are – in line with the power laws - very much larger than others).

Six of these 25 Swedish slaughterhouses are run by Scan, one of northern Europe's largest food companies (working mainly with meat). As if by coincidence, I read in a Swedish trade journal (“Agriculture News”) that one of Scan’s six facilities (in Uppsala) will be closed and that most of the activities at another facility (in Skara) will disappear in the near future. "The slaughter and butchering of cattle and sheep be centralized to Linköping and the slaughtering and butchering of pigs will mainly be located to Kristianstad. <...> Total headcount will be reduced from 3 000 to around 2 500. Some of the employees may be offered jobs at one of the locations where activities will be centralized." In a column in the same issue of Agriculture News, the journalist Erik Brink writes appreciatively about Scan’s plans for restructuring their business: 

"closure of all slaughter in Skara is just the next step in Scan's crusade to get the Swedish meat producers to better adapt to market conditions. All old emotional trash will be cleared out and only that which makes business sense will remain."



"Adapt to market conditions" is in this context equivalent to going big and "large-scale". If you follow the transports going to and from these (currently) 25 large-scale slaughterhouses you will see that they are hubs with many long transports going to and from them (similar to the air network). There has been a push to rationalize and scale up the size of plants for decades, always moving towards an equilibrium that basically depends on the relationship between the cost of energy and the cost of labor. Energy has been cheap and labor has been expensive. In the search for higher profits, the tune has been to scale up operations by rationalizing, streamlining, concentrating, consolidating and slashing jobs - despite the fact that increased concentration also leads to increased vulnerability and longer transports. As energy has been cheap and the supply has been stable for decades, there has been little reason for any afterthoughts... until now. 



Because what will happen if energy becomes more expensive in the future? What if the relationship between labor and energy will change radically (albeit gradually) after peak oil? I do not mean that gasoline prices (or the price of electricity) will go up with 10 – 20 – 50 – 100 percent, but that the relationship between labor and energy will change fundamentally. Human ecologist Folke Günther has made a graph that shows how many seconds a Swedish industrial worker has had to work in order to buy a kilowatt-hour of energy in the form of gasoline at the gas pump:

EDIT

http://www.energybulletin.net/51140