Preparing for energy constraints
Structural changes in the environment, energy and the economy will ensure that the next twenty years will be completely unlike the last twenty. Before New Yorkers can address that question, they must be briefed on the broader scope of our challenges.Likely climate change impacts on NYC include hurricanes, flooding, and heat waves. A subtle but crucial omission is that preparing for future climate change impacts often leave out the need to sharply reduce our carbon emissions from fossil fuels, to lessen the future impacts of climate change.
Another reason to rapidly transition away from fossil fuels is that we are highly dependent on them, and we are encountering limits to their supplies. In our recent history, the last 150 years in which our modern economy has come to be, we have always been discovering more supplies of petroleum, natural gas and goal. However, conditions have changed.
According to data from the US Energy Information Agency, world crude oil production has barely budged the last several years. Despite record investment in exploration and production development, crude oil production has been on a bumpy plateau. Oil companies are forced to drill in increasingly extreme locations, often miles under the ocean floor. It's because the easy oil has all been found. Even with the slight increase from unconventional oil supplies, world oil production has been stagnant - and could go into permanent decline at any time. We should start preparing now.
When this happens, the price and supply of oil will become increasingly volatile. It doesn't mean we're running out of oil - we will have oil for a long time - but it does mean we have to accelerate our transition to a renewable energy powered economy.
Likewise, we keep hearing that because of new techniques for drilling natural gas from shale, we'll have enough natural gas for 100 years and the US will even be exporting natural gas to other countries. New studies indicate we have far less gas than that, and we should urgently accelerate our transition to renewable clean power instead.
Our economy, beset with multiple financial crises, is already highly volatile. Entering a time in which availability of fossil fuel energy supplies is permanently declining instead of increasing will clearly affect economic conditions. Unending economic growth will no longer be feasible or environmentally desirable, but economic reform leading to a prosperous economy is possible. The policy responses noted above will help us move in that direction and adapt to a future in which price and supply of fossil fuel is increasingly volatile.
Despite sharp increases in oil prices, world crude oil production has remained on a plateau for about seven years. While total world liquids have increased over this same time period, some of those additional liquids (i.e., natural gas liquids, deep water oil, oil sands or corn-based ethanol) are very expensive to recover, or very low in energy density, or very polluting, or also face supply limits.
For a long time, the International Energy Agency dismissed concerns of world oil production peaking in the near term, although each year, their projected production increases became smaller and smaller. In 2010, the IEA's World Energy Report quietly admitted that conventional crude oil production already peaked - in 2006.
In the graph below, IEA shows conventional crude oil from currently producing fields going into permanent and steep decline after 2006. IEA optimistically claims that total oil liquids production can remain stable based on new crude oil production from fields that haven't yet been developed (powder blue) and fields yet to be found (sky blue).
"World Energy Outlook 2010," IEA
If those new oil supplies don't materialize, the ASPO chart below may be a more accurate prediction of future oil production. ASPO analysts think that a world production peak in all liquids may be imminent.
Expanding
the NYC sustainability discussion
NYC Office of Emergency
Management has plans for
disruption
of electric service but not for oil price shocks.
So
far,
fuel volatility seems to be absent from NYC policy
discussions.
In 2008, this writer's report requested the City (1) revise
all planning and budgeting decisions to accomodate
potentially higher energy costs; (2) create
contingency plans for price spikes; and (3) promote
sustainability initiatives as a way of buffering
higher energy costs. It was distributed
to Rohit Aggarwalla, first director of the
Bloomberg Administration's PlaNYC initiative, and
other officials.
Proactive
NYC leaders might want to look at official
reports on
municipal preparation for fuel depletion and energy
volatility issued by the
cities of San
Francisco, CA, Portland,
OR, and Bloomington,
IN.
Expediting the transition to a renewable
energy powered economy
Renewable energy sources such as solar, wind and
geothermal can eventually power much of our economy, and
we should increase their capacity as quickly as
possible. Since
they provide electricity (and some heating) but much of
our transportation and building infrastructure is built
to run on liquid fuels, the transition will not be
simple. Oil
provides about 1/3 of the world’s total primary energy
supply, and about 90% of the energy for world
transportation. The
most
valuable strategies besides regionalizing
agriculture include reducing energy use to European
standards, scaling up renewable power and mass transit,
and upgrading electricity transmission and storage
infrastructure.
For more information:
-
Basics from from Association
for
the Study of Peak Oil
- Energy Bulletin’s peak
oil primer
- Wikipedia on peak oil
- The Post Carbon
Institute