Eric

Baerren

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June 15, 2009

Can We Be Honest About Energy That Will Last?

Over the last several decades, the general assumption has been that enough oil could be found and produced to meet what was expected to be continuously growing demand. The relationship took on the sheen of the world’s most obnoxious economic booster, flogging the idea of growth while angrily shouting down anyone who suggested that there are limits.

That has included shouting down the growing voice that warns we will get to where demand outstrips supply. No problem, the booster would tell you, because that would drive up prices which would then reduce demand to meet supply. If oil were not the blood of the globe’s economy, that would be fine. But higher gas prices in the past have prompted recessions, and reduced demand and is a sign of an economy either stagnating or in recession. The price of oil, creeping up even as we speak, is beginning to cause worry that it might derail economic recovery.

The decline of American oil production is a reminder that even the world’s blood has its limits. But there has always been another assumption – that there is enough supply to last for a long time. Just as conveniently as the supply-demand relationship suggests that demand for energy will never rise above supply, it has always been supposed that there is enough oil to last. How much? Who knows – but it’s enough to last through the immediate future, which is all anyone really cares about.

The latest Energy Information Administration report suggests that peak oil, the end of cheap and reliable energy, may be a bit closer at hand than previously believed. The report scaled back expected production from previous reports, and in 2030, expects the output of conventional fuels to be about 93.1 million barrels a day. Although that’s still higher than current production, it’s 14.1 percent lower than what previous reports have predicted.

When you consider that demand for energy – especially for transportation – is generally expected to rise, a drop in projected production should raise eyebrows. Although the report corrects a supply-demand discrepancy by projecting declining demand, that is predicated on slowed growth in India and China (combined, those countries are soon expected to surpass the United States as the world’s chief consumer of liquid energy). When those two countries recover from the global recession, which could happen this year or next, it could eventually prompt cut-throat energy competition.

As things currently stand, that means investing in unconventional fuels. These include things like biofuels, most of which aren’t entirely ready for the marketplace, but also things like oil shale and the Canadian tar sands.

These come with very serious practical problems, like an ever-increasing input of energy to get the final energy product. Put short, it means squeezing blood from stone. In the case of oil shale, it uses a great deal of water where water is already scarce.

The elephant in the room is environmental costs. Production of unconventional hydrocarbon fuel generates even more greenhouse gases than production of regular old petroleum. Why? You’re using energy to create energy. Liquid fuel produced from coal, for instance, just about doubles carbon emissions. This is on top of physical damage to local environments.

Combined, these suggest urgency and foresight in efforts to wean American motorists off oil, either through higher fuel economy or by development of advanced batteries necessary to make the electric car practical for the marketplace. It also adds legitimacy to novel ideas like the Pickens Plan, which would substitute natural gas for petroleum in many of the nation’s buses and trucks.

Will it work? If there is a concerted effort to shift, it’s possible to avoid economic upheaval. It means being honest about the marketplace’s tendency toward short-term gain rather than long-term sustainability, and permanently shelving the mindless boosterism. It also means being honest about the need for coherent, top-to-bottom energy policy, which is keenly within the purview of government.

© 2009 North Star Writers Group. May not be republished without permission.

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