I’ve been reading up a lot this week about peak oil. I’ve been dipping into my copy of “The Post-Carbon Reader“, which really ought to be required reading for everyone involved in discussions about climate change. It’s a collection of short essays by a large number of forward thinkers, put together by the Post-Carbon Institute. They take as their premise the evidence that we’re now reaching the limits to growth on a number of major planetary indicators (climate change, peak oil, biodiversity loss, agricultural sustainability, the nitrogen cascade, etc).

The existence of these planetary limits was first popularized by the Club of Rome, in the Limits to Growth study. Although many people criticized the original Limits to Growth study, most such criticisms focussed on the details. The central message still stands: long term sustained growth, based on ever growing exploitation of the resources of a finite planet, is simply not possible. So far we’ve manage to avoid such limits through the principle of substitutability: human inventiveness comes up with new technologies that allow us to keep on growing (e.g. in terms of population and in terms of economic activity). For example, the original Limits to Growth study worried extensively about imminent food crises. But in the event these were avoided through the green revolution, whereby farming yields were dramatically increased through new agricultural practices. But these practices are incredibly energy-intensive, and are only possible because of cheap fossil fuels. The challenge now is that now we’re hitting limits in a whole set of areas at once, but most notably in the supplies of cheap energy. The principle of substitutability doesn’t work if all the systems that might drive it are also under stress.

So energy is central to all these issues. The introduction to the Post Carbon Reader points out that the abundance of cheap energy that humanity has enjoyed for the last 150 years is an anomaly in human history, and we’ve become so used to it that it’s hard to recognize how anomalous it it. Peak Oil is the first sign that the anomaly might be ending, and that our access to cheap energy is effectively over.

Last time I wrote about peak oil, I did some back of the envelope calculations to figure out whether peak oil might save us from the climate crisis. My numbers showed that about half of the remaining fossil fuel reserves need to stay buried in the ground if we are to stand a chance of staying below the +2ºC of warming advocated by most commentators. The message was that peak oil won’t save us from serious climate disruption, largely because there are enough coal deposits that a switch to coal (using coal to replace natural gas and oil) will spell disaster. But there’s a worse problem. Once we hit peak oil (which might have already happened), production starts to decline while demand still grows. The result is that oil prices shoot up, making it ever more profitable to drill for every last drop. So, not only will peak oil not save us from climate change, it will exacerbate the problem by ensuring greater profits for those who extract those last remaining drops. The same argument applies to peak coal, which is probably only a few decades away. What would induce people to leave such valuable commodities unexploited?

There is, of course, growing evidence that we’ve already hit peak oil. The spike in oil prices in the summer of 2008 were a taste of what’s to come, and we’ve seen evidence in the last month that oil prices are on their way back up to those levels. The reasons for this are gradually becoming clear: the oil industry has apparently been telling pleasant lies to governments for the last few decades, greatly exaggerating their estimates of remaining oil reserves. The extent of this exaggeration was recently revealed by wikileaks. And the essay by David Hughes in the Post-Carbon Reader explains the context, by exploring how unrealistic US government projections have been.

Much has been made in discussions about climate denialism about the oil industries funding concerted attempts to discredit climate science. But within the oil companies themselves, there does seem to be a recognition that the party is over. Take, for example, this report produced by Shell earlier this month: Shell Energy Scenarios to 2050. The Shell report takes the climate science very seriously, and quotes from the Rockström et. al. paper on on planetary boundaries, along with the the work by Allen et. al. and Meinhausen et. al. on limits to cumulative emissions. There’s no mention from the Shell scenarios team of any doubt about climate change and peak oil – in fact they clearly state that “the longer the delay in climate policy action, the more likely shocks become” (p17).

What’s interesting about this report from Shell is the two different alternative scenarios they explore, which they call Blueprint and Scramble. The blueprint scenario represents serious climate policies that switch to clean energies more rapidly than any current political discussions would achieve. The alternative, Scramble, makes depressing reading. It posits a world in which nations focus more on their own energy security than on the long-term goals of reducing demand and switching to renewables. It’s a scramble for the dwindling fossil fuel supplies that puts supplier nations firmly in the driving seat (at which point we can forget any worries about human rights and equity), and in which we’ll see increasing international conflict:

Scramble in the west could also result in increasing anti-globalisation, more protectionism and political radicalism. […] As global order fragments, governments in developed countries will be pressured to protect the living standards of their populations”.

If oil companies understand this, why don’t politicians?

5 Comments

  1. Very tiny mitigation on the switch from oil to coal: far fewer smokestacks than tailpipes, so can expect higher efficiencies (where fuel is consumed, not counting massive losses from transmission).

    (And if fantastical emission scrubbing technology manifests it can be deployed to fewer places.)

    In the absence of Doc Brown’s “Mr. Fusion Home Energy Reactor”, all the carbon in fossil fuels the ground will become greenhouse gases in the air.

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  3. I’m reminded of the line from Life of Brian – “as much gold as I could eat”. Perhaps the smarter planners are the ones still thinking about food supply rather than energy.

    UK climate scientists contributed to this project –
    http://www.bis.gov.uk/foresight/our-work/projects/current-projects/global-food-and-farming-futures

    Of course one dilemma of increasing food supply is that it can actually drive population growth (in any animal species), whereas increased energy supply isn’t likely to do the same.

  4. The fundamental flaw with LTG (which no-one ever seems to notice, let alone mention) is that they assumed exponential growth in resource use and pollution, with linear (or polynomial, I forget) growth in resources.

    They then spent a long time and lots of graphs demonstrating the obvious, which is that an exp will eventually overtake a linear.

    That part was true, vacuously so, and of course remains true.

    But it tells you nothing at all useful about the timescales, on indeed about whether the assumptions are valid.

  5. @William: Huh?
    The LtG study did spend some time pointing out the nature of exponential growth (which at the time, few policy people really understood, and even today many economists don’t seem to get).

    But that wasn’t the guts of the study. The study used a (slightly simplistic) systems dynamics model that coupled population, economic activity, food, resource consumption, pollution etc, along with a number of information feedbacks, to explore the effects of different ways humanity might respond to approaching limits. The key finding is that if an exponential growth approaches a finite resource limit, with weak or delayed information feedbacks, the result is a collapse; and conversely, with the appropriate feedbacks, such a collapse can be avoided. Furthermore, the nature of delays on those feedbacks matter a lot. I don’t think anyone really understood this before LtG (it was the key insight of the early systems dynamics work), and given the lack of progress in dealing with growth since then, it seems most people still don’t get it.

    Of course, denialists responded in much the same way they do now to climate science: they completely misrepresented the contents of the study, and they did this so effectively that even today most people who have heard of the study have a completely distorted view of what’s in it.

    In fact, it looks like the assumptions underlying their models were pretty accurate. See:
    http://dx.doi.org/10.1016/j.gloenvcha.2008.05.001
    in which the empirical data from the last 30 years is compared with the scenarios used in the models, demonstrating that the scenarios were correct, and therefore that the key points they make about collapse may well still be correct.

  6. Another rather startling turn-around has been the International Energy Agency’s recent acknowledgement of Peak Oil (and more significantly, acknowledging it as having already happened):

    http://www.energybulletin.net/stories/2010-11-11/iea-acknowledges-peak-oil

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