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Breaking the Oil Addiction Counterpoint: The Peak Oil Tango

By Steve Andrews and Randy Udall

Credit: istockphoto.com

History suggests that energy is an IQ test that Americans tend to fail. In response to the Oil Crises of the 1970s, the United States wasted billions in a futile effort to jumpstart oil shale and other synfuels. Then federal automotive fuel-efficiency standards and flush production from newly discovered giant fields in Mexico, Alaska and the North Sea bailed us out. By 1985 oil prices had dropped to $10 a barrel and American energy policy went back to its default position, “stuck on stupid.”

With respect to today’s twin crises — accelerating climate change and an imminent peak in world oil production — our margin for error is far smaller. Consider our predicament: There are now 2.4 billion more people on the planet than there were in 1975. In the intervening three decades, we have used roughly 650 billion barrels of oil. Indeed, half the oil humans have used has been consumed since 1980. Although China has gone mad for cars and the world’s automobiles now consume four times more energy, in the form of fuel, than people consume in the form of food, this time there are no virgin giant fields waiting in the wings.

Global oil production has been rising for 150 years. In the 60 years since the end of World War II, it has risen eightfold. Here in the United States, we have built an entire civilization around inexpensive petroleum. Cheap oil, natural gas and electricity have governed our land-use patterns, automotive designs, architecture, agricultural systems and even our caste of mind. Today a typical American travels the distance to the Moon every 20 years and consumes his or her body weight in petroleum each week. Human beings have always craved perpetual motion, and oil, for a moment, granted our wish to live like gods.

We are not running out of oil, but the era of expanding oil production is rapidly closing. We don’t think it makes sense to sugarcoat what peak oil means. Within a few thousand days, global oil production is likely to have peaked and be in permanent decline. If, by 2015, production is falling by 1 million barrels a day each year, that will represent the loss of as much energy as is provided by 80 nuclear power stations or 2 trillion cubic feet of natural gas. With respect to peak oil, we think it makes more sense to consider a wide range of intelligent responses rather than search for magic “solutions.”

If we want to craft a prosperous way down, there’s little time left. Time is our most precious and least understood resource. Money not spent today can be invested tomorrow, but time lost is gone forever. The excellent report, “Peaking of World Oil Production: Impacts, Mitigation and Risk Management,” by Robert Hirsch et al. states that “more than a decade of intense implementation will be required for world-scale impact.”

Given fundamental energy realities and the degree to which we are hooked on oil and natural gas imports, the notion of seeking “energy independence” through greater drilling is, frankly, a fantasia. Imports now supply two-thirds of our petroleum liquids, plus 20 percent of our natural gas. Eliminating imports to enhance national security may sound worthy, but it is impossible.

U.S. oil production has been falling for 30 years. North American natural gas production is now in permanent decline. Some of the silver bullets sound great … until you do the math. Producing 10 million barrels per day of coal liquids would require doubling the amount of coal mined in this country, with suicidal climate impacts. A U.S. Department of Energy official recently opined that we could produce 2.5 million barrels a day from Colorado’s oil shales. Since that would require building 25 new power plants to heat the kerogen in the shale into oil, this is thermodynamic insanity, a bureaucrat’s pipedream. Where do they find these people? We could afford to chase panaceas in the 1970s, but not this time.

We agree with the Hirsch Report’s finding that our biggest challenge will be liquid fuels. Corn ethanol is a dog, but cellulosic biofuels have promise. Since today’s cars waste about 80 percent of the energy they consume, there are enormous opportunities to improve fuel efficiency through advanced engine designs, lighter vehicle platforms, hybrid drives and better tires. What’s our strategy for averting the worst impacts of peak oil?

1. Start with education. Until federal and state officials understand peak oil and natural gas, they will continue to make dumb energy choices. Until more citizens and corporate decision-makers grasp the critical realities, they will continue to tolerate policies that put prosperity at risk.

2. Focus on efficiency. We need to double new car and truck efficiency as rapidly as possible, but no later than 2017. Since higher CAFÉ standards remain contentious, we favor a strategy that combines (a) feebates whereby gas guzzlers pay a fee, while sippers get a rebate; (b) higher gasoline taxes; and (c) increased fuel-efficiency standards.

3. Switch fuels substantially from liquids to electricity. Plug-in hybrids offer enormous potential and merit rapid R&D. Of course, any fuel-switching effort requires a major push toward renewable energy; otherwise moving cars onto the grid will simply accelerate climate change.

4. Improve land-use planning. No quick fix here, but we need to begin steering infrastructure development (and redevelopment) away from the “more lanes” philosophy that has ruled since WWII. Mixed-use, higher-density design is the wave of the future.

5. Ramp up investments in mass transit.We must revitalize and expand rail transportation.

6. Conserve. Conservation is arguably the most patriotic thing we can do.

7. Reconsider alternative fuels. Current policy doles out perks for a technology patchwork of corn-based ethanol (with a low return on energy investment), oil shale (still, after 100 years, in R&D), coal to liquids (not yet commercial with carbon dioxide sequestration) and hydrogen (two decades away, since it’s an energy carrier, not a fuel). If cars become four times more efficient, cellulosic ethanol may help the move toward sustainable mobility.

We do not support incentives to “increase domestic supply.” That’s a delusion, since it will be difficult to keep U.S. oil production flat, let alone increase it. Given today’s oil prices, the market is providing sufficient incentives to oil companies to optimize production. We will need to drill 35,000 to 50,000 oil and gas wells each year in this country simply to keep production from plummeting.

Time is short. We can’t flunk the energy IQ test again.

Steve Andrews and Randy Udall, American Solar Energy Society members, are two of the co-founders of ASPO-USA (the Association for the Study of Peak Oil and Gas, www.aspo-usa.com). They’ve spent a combined four decades in energy, working on residential efficiency, renewables and the utility sector.

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