Peak Oil - An objection to Hubbert's U.S. production curve as a benchmark for world production

[Tigermoose]

I have thought about Peak Oil for a while, trying to figure out if it is a reliable theory or not. I think I have thought up a valid objection. Here it is.

Hubbert's model for U.S. production that follows a bell curve only shows a decline because of market substitution. Let me explain. As the cost of other non-U. S. oil producers became lower than U. S. producers, the market naturally shifted consumption to the non-U. S. producers. Thus, there is a decline in U. S. production as non-U.S. production is cheaper. This is the decline slope in the bell curve.



But I contend that this does not hold true for world production. As world oil prices rise, demand will slacken (econ 101). This in turn will reduce the price. This will go back and forth until an "ideal" price is reached. So instead of a decline, I see a plateau of oil production and consumption. There is no sufficient substitute that consumers can go to instead of oil, so we will not have the steep downward curve of the Hubbert model. And if we do come up with a better solution, then all so much the better.

Whew. So perhaps the fears of societal collapse are unfounded? Perhaps instead we will see a decade or two of low to no-growth while the market stabilizes the price of oil and better substitutes are identified and consumption is lowered.



What do you think? Is this a valid criticism of peak oil? If others have argued this before, please send me some links!

[Blue Meany]

1. I think you have got part of the picture right.

As I see it, the industrial economy is dependent on cheap oil. As the price rises, it depresses this economy. This, in turn, diminishes the demand and the price goes down. This phenomenon puts a permanent damper on the economy and causes a continuing roller coaster effect on oil prices, the latter of which is exacerbated by speculation.

My take is that we have been at a peak-plateau for the last several years. The smart thing to do now would be to invest as much oil as possible in the creation of a new energy and transportation infrastructure (it will take massive amounts of energy to create this). The longer we wait, the less oil there will be to do it; thus it will take longer and be more expensive. As a society, however, we are choosing to make only token efforts, which is by default, choosing the path to societal collapse. It doesn't have to be this way, but the choices will determine out future.

BTW, I don't think that Hubbard accounted for the possibility of the opening up of new frontiers in the Arctic and Antarctic that might provide additioal sources of oil. If this happens, and the oil resources are mined and burned, this would be another path to collapse--via global warming.

[Tigermoose]

2. Price will bring about change - speculation is healthy

Speculation is a fundamental necessity for oil production. Purchases of the commodity stock leads to higher prices and more money for the oil producers to invest in more oil production, which in turn leads to lower prices as more oil comes online, which reduces the price, which increases demand, which increases price, which increases investment --- etc. This "roller coaster" is a normal part of the market economy.

I think that the governments of the world need to stop subsidizing oil production and let the market price oil. Then, that higher price will signal to consumers that they need to reduce their consumption, and alternative energy sources might become more viable. I think that government subsidies is causing a disconnect between the "true" price of oil and the consumer.

[FBaggins]

3. "Price elasticity of demand" complicates that a bit.

It isn't econ-101 (probably 201), but it's still an important factor.

Demand for oil is not as "elastic" as some items. Double the price of beef and some people will switch to chicken. Double the price of gasoline and their office doesn't get any closer nor their car more efficient. They can't throw a switch (in most cases) and run the car off of something else. A truck still needs to bring the groceries to the corner store... etc.

SOME gasoline demand dries up at the higher prices (the trip to grandma's house no longer looks affordable)... but it takes much longer for overall demand to fall in response to the higher prices.

All that said, Hubbert was wrong for other reasons. Not that peak oil isn't a reality, just that his timeline was off (potentially way off). Among other errors, he underestimated the impact of technology. We would have passed peak oil years ago were it not for the ability to get to oil that he had no idea was accessible.

[bananas]

12. Hubbert was wrong? You are insulting Hubbert! Blasphemy!

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=115&topic_id=246204&mesg_id=246356
:rofl:

edit to add: http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=115&topic_id=246204&mesg_id=246783
:rofl:

[FBaggins]

13. Insulting? Certainly not.

I'm just saying that he was wrong as to dates. The overall theory is essentially a truism.

Unlike the subject of post you reference... I'm not misstating Hubbert's position. He didn't posit a peak in nuclear power, nor was the supposed "peak" that you identified at all releated to a Hubbert-ian peak.

[bananas]

17. Hubbert became anti-nuclear and pro-solar - most "Hubbertians" ignore that

For some reason they worship the ancient sacred text he wrote in the 1950's,
and ignore everything he said after that.
Typical of irrational religious cults.

[FBaggins]

18. Which is entirely irrelevant to the discussion.

It has nothing whatsoever to do with whether "peak nuclear" was an appropriate term for an occurance that had absolutely nothing to do with a hubbert-type peak. Nor does it have anything to do with whether or not hubbert thought we would hit such a peak within multiple centuries.

Nor, frankly, would his changed position late in life (probably in his dotage:)) dig you out of the hole you dug at the time that claimed that he predicted a peak uranium about a decade from now when what you were looking at what the "uranium for inventory" line.

[bananas]

19. It's entirely relevant - the OP is specifically about "market substitution"

As Palast points out, Hubbert knew that tar sands could substitute for light crude,
but thought that mined uranium would be a better substitute.
(edit to simplify and remove reference to bred plutonium).
(edit to add: Hubbert predicted a peak demand for mined uranium to fill the inventory).

Later, Hubbert realized that solar was a MUCH better substitute than fission.
And no, it wasn't his "dotage", it was after he served on an AEC commission and learned first-hand that fission was not the safe clean energy source he had been told but had tremendous intractable problems. Also the steady advances in solar energy convinced him that solar was fully capable of substituting for oil, and that solar was a much better substitution for oil than fission.

[Tace]

4. On Catabolic Collapse -- John Michael Greer

http://www.energybulletin.net/node/16649

snip

The idea of catabolic collapse is simple enough, and it's best communicated through a metaphor. Imagine that, instead of the fate of civilizations, we're discussing home ownership. Until recently, when people went shopping for a home, most of them were sensible about it and bought one within their means. The housing bubble of the last few years, though, encouraged quite a few people to get in over their heads, buying much more house than they could afford, on the assumption that appreciating real estate values and the other advantages of home ownership would make up the difference.

If you're one of these latter, though, you probably didn't take the time to work out just how much your huge new McMansion would cost to own, maintain, and repair, and you almost certainly didn't realize that every period of rising real estate values gives way to a period of stagnant or falling values sooner or later. As these realities begin to sink in, you find yourself in a very awkward bind, because your monthly paycheck doesn't cover all your monthly expenses. You can cover the difference for a while by refinancing your house and extracting any extra equity in cash, but that only works as long as interest rates keep dropping and home values keep rising. Once that option's closed off, you've got very few others as long as you plan on keeping the house. You can take on more debt, which means your bills go up; you can postpone maintenance and repairs, which means your house begins to fall apart, and your bills go up; or you can stop paying some of your bills, which means your house becomes much less livable, and your bills go up. Eventually you end up so deep in the hole that you can't pay the mortgage and the property taxes any more, and you lose the house.

That's catabolic collapse in a nutshell. Like suburban mansions, civilizations are complex, expensive, fragile things. To keep one going, you have to maintain and replace a whole series of capital stocks: physical (such as buildings), human (such as trained workers), information (such as agricultural knowledge), social (such as market systems), and more. If you can do this within the "monthly budget" of resources provided by the natural world and the efforts of your labor force, your civilization can last a very long time. Over time, though, civilizations tend to build their capital stocks up to levels that can't be maintained; each king (or industrial magnate) wants to build a bigger palace (or skyscraper) than the one before him, and so on. That puts a civilization into the same bind as the homeowner with the oversized house.

What happens then depends on whether the civilization's most important resources are sustainable or not. Sustainable resources are like a monthly paycheck; you've got to live within it, but as long as you can keep expenses on average at or below your paycheck, you know you can get by. If a civilization gets most of its raw materials from ecologically sound agriculture, for example, the annual harvest puts a floor under the collapse process. Even if things fall apart completely -- if the homeowner goes bankrupt and has his house foreclosed, to continue the metaphor -- that monthly paycheck will let him rent a smaller house or an apartment and start picking up the pieces. Civilizations such as ancient Egypt and imperial China, which were based on sustainable resources, cycled through this process many times, from expansion through overshoot to a self-limiting collapse that bottomed out when capital stocks got low enough to be supported by the steady resource base.

more

http://www.energybulletin.net/node/16649

[Tigermoose]

7. Can you please explain your point?

I'm not really getting what you are after here.

1. My household cannot maintain and adjust the monetary supply as a way of easing through shocks. So I don't see how this metaphor is relevant. Maybe you are making an environmental argument rather than an argument about peak oil?

2. The market is the process whereby scarce resources are allocated by price. I guess you are putting forth an "overshoot" argument? I think that you are arguing about environmental degradation rather than peak oil?

[bananas]

10. It's pseudo-science. nt

[Terry in Austin]

15. Surely you can do better than that.

Go on -- I'm listening...

[Tace]

16. Tigermoose, I Couldn't Find The Example I Wanted For Catabolic Collapse...

But, in Greer's concept of catabolic collapse, the collapse of civilization (and oil supplies) occurs in a step-by-step fashion, with flat areas between steps down, much as you are suggesting that market prices would impede a quick collapse of oil supplies.

[bananas]

5. Congratulations

Here’s an intriguing thought: Global oil supplies are indeed set to peak within a few years, and no, that is not bullish for oil. Quite the contrary—it will spell the end of the “oil age.”
...
That will send oil to $175 a barrel by 2016—and will simultaneously put the final nail in oil’s coffin and send prices plummeting back to $70 by 2030. That’s because there’s an even more important “peak” moment on the horizon: A global peak in oil demand. That has already begun in the world’s biggest oil-consuming nation, Deutsche Bank notes:
...
The big driver? The coming-of-age of electric and hybrid vehicles, which promise massive fuel-economy gains for short-hop commuting but which so far have not been economic.

See http://blogs.wsj.com/environmentalcapital/2009/10/05/peak-oil-the-end-of-the-oil-age-is-near-deutsche-bank-says/
and http://climateprogress.org/2009/10/07/deutsche-bank-oil-to-hit-175-a-barrel-by-2016-which-will-drive-a-final-stake-into-long-term-oil-demand-spurred-by-a-disruptive-technology-the-hybrid-and-electric-car-that-will-very/

[bananas]

6. Hubbert first thought uranium would substitute for oil, later he became anti-nuclear and pro-solar

He favored a nuclear phase-out: "the sooner we get rid of it the better off we’re going to be. I would never recommend shutting all the plants down tomorrow, but certainly phasing them out."

He was very pro-solar: "We could make the transition in a matter of decades if we begin now."

See http://journals.democraticunderground.com/bananas/1229 for sources.

[Terry in Austin]

8. Welcome to the wonderful world of peak oil

You may have already found that discussions of peak oil tend to generate more heat than light. In that respect, as well as in more substantive ways, peak oil has much in common with climate change.

IMO, a lot of confusion (deliberate and otherwise) about peak oil centers around this: it's not about economics, it's about geology.

The rude fact is that the peak is already here -- world oil supply will never again increase. Not much theory there, just dumb geology. The thing is, though, we've built a way of life that absolutely depends on an ever-increasing supply of the stuff.

The prospect is enormous. It challenges our beliefs about ourselves, and represents a huge loss. With that in mind, you can trace a sort of Kubler-Ross sequence throughout discussions about peak oil: denial, anger, bargaining, depression, and eventually, acceptance.

Most people seem to be in the first phase, denial -- just as there were a lot of climate-change deniers at first, so there are for peak oil. For those further along, the bargaining stage tends to include a lot of discussion about market forces and techno-fixes like nuclear, fusion, and yes, large-scale solar and wind.

The gist of the bargaining stage is "If only we can be clever enough, we can keep our addiction" or even "If we show up at the window with enough cash, God will put more oil in the ground." We believe we can solve the problem with brains or money or both.

The real kicker is that it's not even a problem, in the sense that problems have solutions. It's more accurately described as a predicament -- something you just adapt to and manage as best you can. However, that's some medicine that does not go down easy.

The relevance of the John Michael Greer piece may not be immediately clear to anyone just starting to pay attention to peak oil issues. He tends toward longer-term, big-picture kind of stuff: the idea is that, since our society is effectively built on oil, the decline of oil will necessarily have some sort of downward effect on society in general -- this is the "catabolic collapse" analysis.

"Collapse" tends to be misunderstood, I think, because it sounds so drastic and dramatic. "Catabolic" basically just means slow, pervasive, and more or less manageable. Maybe that takes some of the sting out of it, anyway; makes the long-term facts a little easier to face.

If you're seriously interested in the subject, Greer is one of the smartest commentators on it, IMO, and his weekly blog (thearchdruidreport.blogspot.com) is a valuable read. Highly recommended.

Good luck with the red pill -- the future ain't what it used to be!

B-)

[GliderGuider]

11. +1

Very, very well said. On every single point.
:thumbsup:

[pscot]

39. That's good

as a reading of the public mind. But predictions about the scope or speed of collapse are highly speculative.

[Tigermoose]

20. I'll take a look, but right now I don't see the big deal. Yes, the world changes.

My initial reaction to your summary is as follows:

A gradual shift of our economy and way of life isn't really a surprise. That's pretty much just the way things have always gone. This is not a crisis, just the normal course of history. No need to stockpile ammo and spam. :)

[GliderGuider]

22. You might benefit from dipping into the dynamics of complex adaptive systems

Our civilization definitely qualifies as one of those. One of the interesting characteristics of such systems is that as they grow and become ever more efficient they lose resilience, becoming fragile, brittle and prone to failure avalanches triggered by small crises. It’s also known as a “sandpile problem” – the model is a pile of sand onto which you slowly pour more sand, making the pile grow and increasing the steepness of its sides at the same time. At some point the sides will be steep enough that dropping a single grain of sand at the right place will cause an unpredictable avalanche on the pile.

As applied to Peak Oil, the theory goes that if the post-peak decline of oil is steep enough, some critical systems (like JIT supply chains) might not have enough time to implement substitution, and instead of gradually shrinking, they fail. Failures like those could set off further downstream collapses that ripple out into the economy. It may not happen just like that, but that’s the underlying theory.

As Terry said, there are five phases to the process of understanding what’s going on right now. You sound like you’re in phase 1. Don’t be surprised if you do more research and your feelings change dramatically. Especially if you broaden your research to include everything else that’s causing problems in the world today (economics, growing social injustice, climate change, food security, ocean acidification, species extinctions, pollution, the depletion of other natural resources, deforestation, the thinning of the commercial genomes of many species etc.). And most especially if you roll all that stuff into a systems view and look at how it all interacts. Peak Oil is real, but could end up being the least of our worries.

Have a nice day… :evilgrin:

[Tigermoose]

23. My OP argues that there will be no steep decline

You say, "the theory goes that if the post-peak decline of oil is steep enough..."

I am cutting at the root of the peak oil theory by showing that the foundational model that shows a steep decline is flawed as a model for future world oil production. If that is the case, your arguments are invalid. There will be no steep decline in production, and thus no abrupt failures and downstream collapses.

Your argument that I am in denial is just childish. I could easily argue that you are an irrational fool but just don't know it. That won't get us anywhere, now will it? Besides, I accepted Peak Oil as a fact years ago but have recently begun to question its foundations as I learn more of the facts.

One last point. People's imaginations tend to get captured by metaphors (and models) that make a good story but have little basis in reality. "Bubbles," "Peaks," etc capture the imagination and lead to understandings of the world where things "pop" or "collapse." It seems to make sense as long as the metaphor or model is valid. But perhaps its time for you to take another look at the validity of the model in your head.

[GliderGuider]

25. Why not go over to The Oil Drum and pose the question?

There are a lot of oil experts there who will be more than happy to address your insight.

I'm not saying you're in denial. I'm saying it sounds like you might be, and I say that because I recognize the territory - I've been there too, about 6 years ago. I'm always shocked when beliefs I've clung to (sometimes not even realizing they were beliefs, instead mistaking them for Truth) are shown to be incorrect. I'm just cautioning you not to be too surprised if something similar happens to you over this issue.

Good luck with your quest. May you learn much.

[Tigermoose]

29. Caution: you might be wrong

Right back at you. ;)

I think I will head on over to the Oil Drum. I've also posed this interpretation over at the Chris Martenson Crash Course site.

[GliderGuider]

30. Cool. Post it in the current thread on decline rates, and we'll see what happens.

I've been wrong before. It never bothers me - that's how I learn.

[Tigermoose]

31. I just posted it - hopefully it isn't too late in the discussion

Hopefully people will respond to the objection or tell me why my interpretation of the model is faulty.

[GliderGuider]

50. You're being offered a very good education over on TOD.

A number of people have gone to great lengths to explain in depth (and in good faith) where you have gone astray in your thinking. It looks to me as though you are simply unwilling to consider that geology is a limiting factor.

It also looks to me as though you have let your sense of self get tied up with this idea. That might be part of what's blocking you from hearing different views. I hope some deeper consideration will permit you to take on board some of what you're being given.

[Terry in Austin]

26. Is 4.5% steep enough for you?

That's what CERA is using for their projected decline rate, and they are they are well-known for their optimism as cheerleaders for the oil industry. Even that rate -- let alone the more realistic 6% - 8% estimates -- is likely to have a pretty game-changing effect, if you care to put a pencil to it.

You might want to check a little more into what goes on in the oil patch and then come back to theory. The Oil Drum, for one, is a very good place to start if you're looking for actual data. In fact, there's a discussion going on right now about how fast or slow the decline in supply will be.

It appears you may be distracted or overly concerned by a lot of the narrative and cultural baggage accompanying peak oil -- metaphors, collapse, ammo-in-the woods alarmism, etc. Certainly, alarmism doesn't help clarity much. But it's a good bet that your instincts to learn the facts will keep you on the right track.

In any case, I suggest it's a little premature in your investigation to conclude that "There will be no steep decline in production, and thus no abrupt failures and downstream collapses."

There are quite a few steps in between, and much hinges on how steep is steep, how abrupt is abrupt, and what exactly is meant by "collapse." These are quantitative issues, and it's going to matter how much of a difference will make a difference.

[The2ndWheel]

24. How many gradual shifts of economies and ways of life have been

simple, easy, or peacefully accepted by everybody to just be the normal course of history?

[Tigermoose]

32. It depends on who you ask.

There is no general answer. I doubt anything is accepted by 'everybody.'

[The2ndWheel]

34. Exactly

Probably why it won't be a smooth and orderly transition into whatever comes next. It certainly wasn't, in many ways, as our current reality was being formed.

[Tigermoose]

35. History tends to only retell the horrific and disastrous.

For a lot of people, however, it wasn't all that bad. Some people even managed to enjoy their lives.

[The2ndWheel]

47. Very true

Some see it as collapse, others see it as progress, it all depends on the point of view of who, when, and where you are. Some see it as liberation, others see it as a trap. Some see it as a problem to be fixed and solved, others see it as a predicament larger than our ability to take everything into account.

[bananas]

9. Palast: "So where did Hubbert get the idea that we are running out of oil? He didn’t."

"So where did Hubbert get the idea that we are running out of oil? He didn’t. He made no such prediction. Quite the opposite..."

http://www.gregpalast.com/madhouse/index.php/32

<snip>

On March 7, 1956, geologist M. King Hubbert presented a research paper that would, a half century later, become the New Gospel of Internet Economics, the Missing Link that would Explain It All from the September 11 attack to the invasion of Iraq.

<snip>

“It’s true that there’s only twenty years’ supply left-and that’s been true for the last hundred years,” Lewis Lapham told me over a decent sauterne at Five Points. (He more often sups at Elaine’s, but I don’t rate that.) Lapham of Harper’s magazine is the only editor in the hemisphere with hard knowledge of the petroleum market, insight he inherited legitimately: His family helped found Mobil Oil, the back half of what is now Exxon Mobil.

He asked, “Why in the world would oil companies, or any company, announce that there’s lots of its product out there? You’d bust your own market. It’s better to say the cupboard’s bare.” As Lapham noted, we have been “running out of oil” since the days we drained it from whales.

<snip>

http://www.gregpalast.com/madhouse/index.php/33

<snip>

How could Hubbert have missed all this oil? Answer: He didn’t. On page 20 of his famous “Peak Oil” study, he accepts that the planet can yield up 800 billion barrels of oil from tar sands equal to all the “crude” (i.e., liquid) oil we are using up.

Hubbert’s Wars

So where did Hubbert get the idea that we are running out of oil? He didn’t. He made no such prediction. Quite the opposite, he said, after predicting “the culmination of world production” by 2006, he noted,
“This does not necessarily imply that the United States or other parts of the industrial world will soon become destitute of liquid and gaseous fuels….”

So what’s going on here? This is where Hubbert brings in Canadian tar sands and heavy oils, which he correctly predicts could more than replace the cheap, easily obtainable “liquid crude” (as he calls the light stuff). And he doesn’t fail to note the location of the giant supplies of the heavy oil: “Mesopotamia” (as Iraq was then known), Brazil and Venezuela.

So what was bugging Hubbert? We have plenty of oil, it just gets heavier. He warns against drilling for it, preferring a uranium-powered future. Why? Hubbert was writing in the hottest moments of the Cold War. The U.S. overthrow of Iran’s government and the looming tension over the Suez Canal pushed America and the Soviet Union toward nuclear war-and underneath it all was the tussle over oil. Hubbert’s peak did not identify dates we’d “run out of oil” but predicted the shift in the location of oil’s main sources-to Iraq and Venezuela by the beginning of the twenty-first century, which had serious implications, he said, for “domestic purposes and national defense.” To avoid conflicts between the U.S. and Russia, he hoped the superpowers in conflict would turn inward, to uranium, a resource abundant in both nations. The value of Hubbert’s seminal “peak” paper was not in predicting the end of the oil era but in naming, with chilling accuracy, the date and location of our future wars.

<snip>

[Terry in Austin]

14. The crucial premise: "We have plenty of oil"

Alas, that turns out not to be the case.

Hubbert just kicked off the discussion by noting the rude tendency of oil sources to follow a roughly parabolic course. Others escalated it by noting that the planet as a whole can rightly be considered an oil source, where the same dynamic applies.

Still others take offense at the rudeness of geology and continue the discussion with much hairsplitting and examination of plausible contingencies. Along the way, many things may come to light that are arguably true, but in the last analysis, irrelevant.

What is relevant is on the ground in the oil patch. And there, the story is fundamental: world oil supply is no longer increasing, nor will it ever again.

The real discussion now is about how to adapt.

[Tigermoose]

21. How to adapt? That's easy.

Price increases, people consume less. Price increases, our society changes to accommodate the increased prices by finding substitutes or altering behavior. Long term, this is not a problem. A short term crisis would be a problem, but once we understand the basic fact that Hubbert's model's drastic decline will not apply in a world system, then we can rest assured that no short term crisis will occur.

[Terry in Austin]

27. If you say so

It's also easy to quit smoking: just don't light another cigarette.

>> the basic fact that Hubbert's model's drastic decline will not apply in a world system

It's not clear that you've established this fact. Still...

>> our society changes by...altering behavior

...you have come to the essential point, however understated. The altered behavior will consist of arranging things so that we live with perhaps a fifth of the energy per capita we now have.

As for substitutes for fossil fuels, there aren't any, if "substitute" means replacing the amount of energy they provide.

[Tigermoose]

28. I'm looking for a refutation of my substitution interpretation of Hubbert's model

I'm looking for someone to show me that Hubbert's model validly applies to the world system of production. From my research, this Peak Oil theory uses this model as its foundation in making predictions. If that model is inaccurate, then much of the hype and predictions of the peak oil crowd are invalid. Right?

As long as the duration of the decline is lengthy, adaptation will not be a significant problem. If the duration of change is quick, then there is a crisis. I'm arguing that I don't see a valid reason that this change will be abrupt due to the market's ability to effectively allocate scarce resources. I see that there are several enormous deposits of energy available to make this duration of change a lengthy process -- tar sands, oil shales, deepwater, wind and solar, geothermal, coal, tidal, etc. These won't replace oil, but will supplement oil enough to avoid a short term crisis.

[kristopher]

33. "duration of decline"?

Not sure what you are measuring with that term as the "duration" is actually going to depend on several other variables triggered by marginal price increases in petroleum more than the pace of geologic constraints (especially true because of oil sands).

IMO what is important is whether there are ready and available alternatives to petroleum.
There are available: renewables, nuclear and energy efficiency with battery storage or H2; plus natural gas and or biofuels and of course, coal.

What matters next would be
a) the price/unit of delivered power compared to petroleum
b) the capital cost to implement the technologies and how the capital cost is spread across society
c) The net energy yield of the various options.

There is no way the world disintegrates into the MAdMax scenario or anything like it. Counter-intuitive as it may seem, it is also more probable IMO that a hard and fast need to transition (the signal would be rising prices) would actually spur the global economy rather than result in prolonged depressed economies. The problems the we will see are going to be a result of artificially supporting the present petroleum based economy long past the time when more efficient systems should take over; resulting in a sort of monopolistic inefficiency that societies get to pay for.

Those are *possible* choices, but we also need to evaluate those choices against a set of criteria in order to extract the "should" from the "could".

As originally published:
Abstract

This paper reviews and ranks major proposed energy-related solutions to global warming, air pollution mortality, and energy security while considering other impacts of the proposed solutions, such as on water supply, land use, wildlife, resource availability, thermal pollution, water chemical pollution, nuclear proliferation, and undernutrition. Nine electric power sources and two liquid fuel options are considered. The electricity sources include solar-photovoltaics (PV), concentrated solar power (CSP), wind, geothermal, hydroelectric, wave, tidal, nuclear, and coal with carbon capture and storage (CCS) technology. The liquid fuel options include corn-ethanol (E85) and cellulosic-E85. To place the electric and liquid fuel sources on an equal footing, we examine their comparative abilities to address the problems mentioned by powering new-technology vehicles, including battery-electric vehicles (BEVs), hydrogen fuel cell vehicles (HFCVs), and flex-fuel vehicles run on E85. Twelve combinations of energy source-vehicle type are considered. Upon ranking and weighting each combination with respect to each of 11 impact categories, four clear divisions of ranking, or tiers, emerge. Tier 1 (highest-ranked) includes wind-BEVs and wind-HFCVs. Tier 2 includes CSP-BEVs, geothermal-BEVs, PV-BEVs, tidal-BEVs, and wave-BEVs. Tier 3 includes hydro-BEVs, nuclear-BEVs, and CCS-BEVs. Tier 4 includes corn- and cellulosic-E85. Wind-BEVs ranked first in seven out of 11 categories, including the two most important, mortality and climate damage reduction. Although HFCVs are much less efficient than BEVs, wind-HFCVs are still very clean and were ranked second among all combinations. Tier 2 options provide significant benefits and are recommended. Tier 3 options are less desirable. However, hydroelectricity, which was ranked ahead of coal-CCS and nuclear with respect to climate and health, is an excellent load balancer, thus recommended. The Tier 4 combinations (cellulosic- and corn-E85) were ranked lowest overall and with respect to climate, air pollution, land use, wildlife damage, and chemical waste. Cellulosic-E85 ranked lower than corn-E85 overall, primarily due to its potentially larger land footprint based on new data and its higher upstream air pollution emissions than corn-E85. Whereas cellulosic-E85 may cause the greatest average human mortality, nuclear-BEVs cause the greatest upper-limit mortality risk due to the expansion of plutonium separation and uranium enrichment in nuclear energy facilities worldwide. Wind-BEVs and CSP-BEVs cause the least mortality. The footprint area of wind-BEVs is 2–6 orders of magnitude less than that of any other option. Because of their low footprint and pollution, wind-BEVs cause the least wildlife loss. The largest consumer of water is corn-E85. The smallest are wind-, tidal-, and wave-BEVs. The US could theoretically replace all 2007 onroad vehicles with BEVs powered by 73 000–144 000 5 MW wind turbines, less than the 300 000 airplanes the US produced during World War II, reducing US CO2 by 32.5–32.7% and nearly eliminating 15 000/yr vehicle-related air pollution deaths in 2020. In sum, use of wind, CSP, geothermal, tidal, PV, wave, and hydro to provide electricity for BEVs and HFCVs and, by extension, electricity for the residential, industrial, and commercial sectors, will result in the most benefit among the options considered. The combination of these technologies should be advanced as a solution to global warming, air pollution, and energy security. Coal-CCS and nuclear offer less benefit thus represent an opportunity cost loss, and the biofuel options provide no certain benefit and the greatest negative impacts.



Same single paragraph broken apart for ease of reading:

Energy Environ. Sci., 2009, 2, 148 - 173, DOI: 10.1039/b809990c

Review of solutions to global warming, air pollution, and energy security

Mark Z. Jacobson

Abstract
This paper reviews and ranks major proposed energy-related solutions to global warming, air pollution mortality, and energy security while considering other impacts of the proposed solutions, such as on water supply, land use, wildlife, resource availability, thermal pollution, water chemical pollution, nuclear proliferation, and undernutrition.

Nine electric power sources and two liquid fuel options are considered. The electricity sources include solar-photovoltaics (PV), concentrated solar power (CSP), wind, geothermal, hydroelectric, wave, tidal, nuclear, and coal with carbon capture and storage (CCS) technology. The liquid fuel options include corn-ethanol (E85) and cellulosic-E85. To place the electric and liquid fuel sources on an equal footing, we examine their comparative abilities to address the problems mentioned by powering new-technology vehicles, including battery-electric vehicles (BEVs), hydrogen fuel cell vehicles (HFCVs), and flex-fuel vehicles run on E85.

Twelve combinations of energy source-vehicle type are considered. Upon ranking and weighting each combination with respect to each of 11 impact categories, four clear divisions of ranking, or tiers, emerge.

Tier 1 (highest-ranked) includes wind-BEVs and wind-HFCVs.
Tier 2 includes CSP-BEVs, geothermal-BEVs, PV-BEVs, tidal-BEVs, and wave-BEVs.
Tier 3 includes hydro-BEVs, nuclear-BEVs, and CCS-BEVs.
Tier 4 includes corn- and cellulosic-E85.

Wind-BEVs ranked first in seven out of 11 categories, including the two most important, mortality and climate damage reduction. Although HFCVs are much less efficient than BEVs, wind-HFCVs are still very clean and were ranked second among all combinations.

Tier 2 options provide significant benefits and are recommended.

Tier 3 options are less desirable. However, hydroelectricity, which was ranked ahead of coal-CCS and nuclear with respect to climate and health, is an excellent load balancer, thus recommended.

The Tier 4 combinations (cellulosic- and corn-E85) were ranked lowest overall and with respect to climate, air pollution, land use, wildlife damage, and chemical waste. Cellulosic-E85 ranked lower than corn-E85 overall, primarily due to its potentially larger land footprint based on new data and its higher upstream air pollution emissions than corn-E85.

Whereas cellulosic-E85 may cause the greatest average human mortality, nuclear-BEVs cause the greatest upper-limit mortality risk due to the expansion of plutonium separation and uranium enrichment in nuclear energy facilities worldwide. Wind-BEVs and CSP-BEVs cause the least mortality.

The footprint area of wind-BEVs is 2–6 orders of magnitude less than that of any other option. Because of their low footprint and pollution, wind-BEVs cause the least wildlife loss.

The largest consumer of water is corn-E85. The smallest are wind-, tidal-, and wave-BEVs.

The US could theoretically replace all 2007 onroad vehicles with BEVs powered by 73000–144000 5 MW wind turbines, less than the 300000 airplanes the US produced during World War II, reducing US CO2 by 32.5–32.7% and nearly eliminating 15000/yr vehicle-related air pollution deaths in 2020.

In sum, use of wind, CSP, geothermal, tidal, PV, wave, and hydro to provide electricity for BEVs and HFCVs and, by extension, electricity for the residential, industrial, and commercial sectors, will result in the most benefit among the options considered. The combination of these technologies should be advanced as a solution to global warming, air pollution, and energy security. Coal-CCS and nuclear offer less benefit thus represent an opportunity cost loss, and the biofuel options provide no certain benefit and the greatest negative impacts.

You can download the full article at his webpage here: http://www.stanford.edu/group/efmh/jacobson/Articles/I/revsolglobwarmairpol.htm

Or use this direct download link: http://www.stanford.edu/group/efmh/jacobson/Articles/I/ReviewSolGW09.pdf

You can view the html abstract here: http://www.rsc.org/publishing/journals/EE/article.asp?doi=b809990c

Download slide presentation here: http://www.stanford.edu/group/efmh/jacobson/Articles/I/0902UIllinois.pdf

Results graphed here: http://pubs.rsc.org/services/images/RSCpubs.ePlatform.Service.FreeContent.ImageService.svc/ImageService/image/GA?id=B809990C

[Tigermoose]

36. Do you account for behavioral changes?

I see that you do a great job looking at technologies, but I also think that reduced consumption combined with lowering population rates due to reduced birth rates will have a big effect. Our society is built around cheap oil. But if we have a gradual transition rather than an abrupt crisis, society and people will adapt and reduce demand.

We need to let the price of oil rise according to market supply and demand rather than trying to preserve a low price through subsidies. Only then we will see behavior change and alternative technology adoption.

[kristopher]

42. That's a good question

I was speaking in economic terms, which is directly concerned with behavior and choice. The role of money in economics is as a nerve system that coordinates cultural critter.

Some people think that our beliefs, our "ideas", are the primary force that shapes our relationship with each other and the world around us. These "idealists" (not to be considered snarky at all) are describing behavior and approaching the issue as one where if we change behavior we can mitigate the adverse consequences of rapid oil depletion.

I know I see it differently (it appears you do too) and in a way that economics is well suited to express, as the well thought out OP shows. I'm a materialist, meaning that I think the material world and our direct relationship with it is primary and that it is what causes the formation of beliefs, social structures and social norms.

From that perspective I would just want to add a bit of flesh to a couple of of your assumptions, you wrote, "reduced consumption combined with lowering population rates due to reduced birth rates"

When I see "reduced consumption" I want to substitute "increased efficiency" as the former implies at the individual level a reduction in utility while the latter implies a steady state of benefits from reduced energy usage.

I'm not clear what the reduced birth rates would result from in this discussion, since that is usually a consequence of reaching a high level of specialization within a society. In the long run it is a factor, but the more immediate trend is for growth to continue for a bit longer. If your saying that you actually thinklargescle deployment of renewables would - since they are more easily deployed in the places that need energy most - act to accelerate the global transition to a more educated and specialized place universally; I'd have to say that sounds very possible and it is something I hadn't considered.


You also wrote that our society is built around cheap oil and then speak of a gradual vs abrupt transition. That was kind of the point of my previous post - we are already past the point where there is cause worry about the pace of transition. If we knew that our conventional oil supply was going to drop by 50%+ within 10 years it would be a huge economic boom as the serious work got underway to put in place a new global energy infrastructure. We've been limping along in a system of steadily declining final efficiencies with centralized thermal electric and internal combustion engines for transportation, but we are now fully ready to replace those technologies. Within as little as 10 years we could easily live with 50% less oil.

The real question, however, is what do we want to replace it with?

[Tigermoose]

44. Price will drive new infrastructure, technology, structures, behaviors

When price goes up sufficiently you will see that economic boom due to infrastructure replacement. I don't think we can proactively force this to happen ahead of the price.

Population: due to declining birth rates, the world population is projected to begin decreasing in 2050. In developed countries, that is already happening. Another factor here is that the ratio of elderly to productive workers is shifting significantly, so we will see lower demand for oil as economies shrink rather than expand.

Behavior, "idealism": I just mean that price will drive people to make different decisions in where they live, when they drive, how they use energy, etc. Economics is all about the allocation of resources, so I think that fits in with your materialist worldview.

[Terry in Austin]

37. A serious understanding of peak oil

It certainly begins with Hubbert's work, but a lot of developments -- and just plain old data -- have come along since then and need to be absorbed for any worthwhile understanding of the subject.

Hubbert noted a particular physical phenomenon, the dynamics of oil production. Newton noted the behavior of falling apples, and the results apply to planets as well as apples. In the same way, Hubbert's results apply at all scales. But we shouldn't get distracted by too much theorizing.

I'm a little concerned that your investigations seem to be in reaction to "hype" and "the peak oil crowd" and so on. Those are social phenomena and not quite the same thing. Peak oil is just a term for the point when world supply of oil stops increasing relative to demand and starts to decline. That's the physical phenomenon.

Sometimes the physical gets conflated with the social. I know there are several typical emotional responses to the the prospect of peak oil, one of which of course is the "omygodwe'reallgonnadietimetobuysomeammoandheadforthehills" response. If you find that one off-putting, you're in good company. However foolish that reaction may be, though, it's not a basis for dismissing the physical events it's associated with. They're two different animals.

Rest assured you don't have to be in a cult in order to be knowledgable about oil production facts and issues, nor will your learning about them put you under suspicion of belonging to one. You've already identified one of the crucial issues -- rate of decline -- and I hope your pursuit of the facts will be fearless and thorough. (You have checked out The Oil Drum, right?)

Good luck!

[Tigermoose]

40. Here's where we disagree

"Hubbert noted a particular physical phenomenon, the dynamics of oil production. Newton noted the behavior of falling apples, and the results apply to planets as well as apples. In the same way, Hubbert's results apply at all scales."

No, it doesn't. The whole point of my OP was that this was an invalid model for world production. I'm beginning to think my objection has legs because nobody will tell me why my objection is incorrect. It shouldn't be that difficult as long as Hubbert's model can account for market substitution as the main explanation of the steep decline.

[Terry in Austin]

41. I guess you're on your own there

>> my objection has legs because nobody will tell me why my objection is incorrect.

If you get to the point of doing any journal writeups, I'd recommend that you don't use that particular argument.

I hope it's not the case, but it seems like you've already made up your mind about what's at the end of a fairly long journey, just barely having started out on it.

Again, it's probably more productive to master the basic body of data before getting all theoretical. But if you're really interested in the subject, and it seems that you are, you'll probably find that out for yourself.

[Tigermoose]

43. Why don't you just answer my objection?

It's not that complicated of an objection. Is there something that is not clear?

[GliderGuider]

45. In the end, you need to do that for yourself.

You have not done the homework yet. You've had plenty of people offer you pointers, now it's time to do the work.

[NickB79]

38. Have you read the Hirsh report?

http://en.wikipedia.org/wiki/Hirsch_report

[GliderGuider]

46. I've been thinking about this a little more.

I'm not clear exactly what you're objecting to. Peak Oil theory simply says that the world's production of oil will at some point reach a peak and then, at some point after that, begin a permanent decline. No big whoop really. Most of what's said beyond that basic observation is, at this point, speculation and inference. The cause of the peak (i.e. the relative importance of various above or below ground factors), the timing of the peak, the length of the peak plateau, the timing of the start of the post-plateau decline, the slope and bumpiness of the post-peak decline curve, the social implications of the decline - all those factors are up for debate, and are in no way part of "Peak Oil Theory".

Now, a number of serious Peak Oil thinkers - including some very heavyweight people who have been assessing the issue for years both professionally and academically - have decided that the problem is likely to be more serious than it at first appears. That doesn't mean they are "right", it just means that is their informed opinion. There are other camps who disagree on virtually every aspect of PO-related speculation, aside from the simple and central point that oil production will at some point reach a peak and then decline.

A lot of people, especially newcomers to the issue, make the mistake of thinking that the inferences and speculative conclusions are part and parcel of the theory itself. They're not. Interestingly, most newcomers tend to reject speculations about the potential for serious disruptive consequences of PO, while accepting the equally speculative conclusion that PO will not pose any major unmanageable disruptions to our tranquil and cud-chewing progress towards the edge of the cliff (sorry, I couldn't help myself :-) ) Both conclusions are speculative, but it's instructive that most people who have been thinking about this for a while fall into the first camp, while the second tends to contain more newcomers (and oil industry smoke-generators). However, as I said before, there is no monolithic consensus on the consequences of Peak Oil.

All we can say for sure right now is that world crude oil production 1) stopped rising in early 2005 and 2) has been on a "bumpy plateau" ever since (+/- 2% over the last six years) while oil prices have gone through massive gyrations. Experience has thus validated two important predictions of PO theory: production will stop rising at some point, and there will be an indeterminate period of relative stasis in production levels during which price signals will fail to influence the supply. Beyond that, all bets are still in play.

[GliderGuider]

48. About those supply and demand curves we all learned about in Econ 101:

They work as expected if the supply in not constrained or there are substitutes. Regarding the situation of the USA post-1970, as westtexas has told you in TOD, there was no slowdown in drilling following the peak, so your speculation about the reason for a decline in US production was mistaken. In the following graph you can clearly see the production peak of the lower 48 in 1970, the secondary peak due to Alaskan North Slope Oil from 1978 to 1986, and the continual decline in production regardless of price thereafter.



On the world stage, the picture is a bit different so far. There was a gyration in the '70s and '80s due to disruptions in the Middle East, but there have been no similar above-ground events that might have triggered the rising prices and stagnating production since 2004/2005.



Since we're talking speculative outcomes here, I expect to see a world curve that ends up looking a bit like a like a sideways bell curve, with the price continuing to rise overall even as the price continues to fall. What that means for civilization is an open question. but I don't think substitution is in the cards. There is no substitute for transportation fuel on this scale, I don't expect efficiency improvements to keep up with the decline rate, and I don't think we can conserve enough without impacting the global economy. But that's just my opinion...

[ironrooster]

49. Glider - salient points

(1) The OP appears to think that supply and demand is inviolable - that is, immune from manipulation.
(2) The OP appears to believe that the cavalry (read scientists/techno fix...) will come to the rescue in the nick of time.

That said, it would be useful to have some idea of what baseline consumption would be if all nonessential
uses of petroleum were eliminated before speculating on the "substitution" argument of the OP.
My hunch is that to maintain - you know - civilization (absent any disruptive technology on the
horizon) there is only so low we can go in petroleum consumption.

I would also point out that when survival is on the line, econ 101 theory goes out the window b/c much of
it is cornucopian biased.

Without constant injections of energy things will unravel (pretty quickly). When I say "things" I mean even
technical know-how and institutional memory.

[GliderGuider]

51. "with the price continuing to rise overall as *production* continues to fall."

Just to drive the point home, there is no substitute for oil as a transportation fuel that will be available in sufficient quantities at the right price, with the right EROEI, and without significant environmental consequences - certainly nothing that will be available within the next decade. And the next decade is the crucial period, as far as I can tell. All of humanity's chickens are coming home to roost.

[Odin2005]

52. I believe what you are describing has been called the "bumpy plateau".