I believe global crude oil production is declining about 6.5% a year. Production of ethanol and oil from tar sands has hit a plateau. Despite recent falls oil must return to high prices as it runs out. What is happening now with oil is a trap for the unwary. While for now Australia has natural gas, coal and coal seam methane the rest of the world wants it so we will pay world prices even at home. In future coal layers will be deeper and thinner and thus more expensive to exploit, with or without carbon taxes.

Having said that I'm not sure that some of the proposals like battery cars are the answer. For Australia it may be better to run heavy vehicles on natural gas if necessary cutting back both on LNG exports and using gas for electrical generation. There is not the slightest sign from Canberra they are thinking that far ahead. We should attack the problem on several fronts including using less energy period. Since Rudd is like a rabbit blinded by headlights perhaps the Obama administration will give us a lead. I think Canberra should give us an energy options paper updated every year that sets out prospects for the likes of liquid fuel imports and substitutions, renewables and carbon emissions then comparing those targets with actual performance. Currently we are getting ever closer to the edge of a cliff.

Taswegian, I'm also sceptical of battery-powered cars in the short term. We need to accept that that private cars will become expensive and public transport will be the way to go in cities. This raises the hard problem of urban sprawl, but there are solutions (e.g., Smart Growth http://www.smartgrowth.org/).

Whether we like it or not, oil will run out relatively soon; my calculation was for all fossil fuels. Once oil gets too expensive (it will never actually run out), things will get really tough. Doing what we do with oil is much more expensive using any of the alternatives.

I strongly recommend reading MacKay's book. I didn't agree with all his solutions but it's an excellent starting point for getting a handle on what's possible.

The thing that worries me is that the pollies all think about the next news cycle, rather than the next 10 years. If we move slowly but deliberately now, we'll find solutions, and the economy will be able to withstand a slow transition. The longer we wait, the more chance there is that we will have little option but to act very fast.

Exponential growth in demand for fossil fuels (the main point of the article) means that the endpoint in resources will happen a lot faster than most expect.

Another fact often overlooked: CO_2 accumulates in the atmosphere, because we are pumping it out faster than the environment can absorb it. Nearly 20% of the excess will still be there in 1,000 years, according to the well-tested Berne model. If we hit a point where CO_2 levels are clearly dangerously high, we will have to go to ZERO emissions. The longer we take to slow down on emissions, the sooner we reach that point.

The only way this will not be a problem is if the science the Rudd government claims to accept is actually wrong. It is therefore very troubling that the government claims to accept all this science, and continues to act as if it doesn't.

In summary: every issue except short-term expediency points to slowing down on fossil fuels.

One thing that is rarely considered is changing our life styles so we need less energy.

There are many ways this can be done. Zoning changes can put people closer to work and mandate energy efficient buildings. Changes in depreciation allowances can make it more profitable to repair old buildings than to put up new ones. Changes in personal consumption habits such as making things do longer, impressing others by ingenuity in use of objects rather than in amassing them, making meals from scratch rather than buying prepared food etc. Engaging in sports rather than paying money to watch other people do it. Taxation rewarding people and companies for effective conservation practices. In Australia we could have a cabinet Department of Conservation that would suggest methods and government policies to further conservation of resources.

Good article. I hope the book is as good as Phil's says - I am downloading it now.

The statement that the pollies don't take sustainability seriously (or AGW, or water supply, or oil - put whatever rocks your boat here), is self evident. I'll take it as a sign they are getting a clue when they start talking about sustainable population densities.

Right now they are saying on one day we should halve our total CO2 emissions, and on the next day making decisions that will lead us to double our population by 2050. Until they show some sign of connecting the two, I assume they are off with the pixies. On the ecological front, if they promise reductions in our ecological footprint while ignore population growth they might as well be promising to turn the sea into ginger beer.

The only possible response I see is ridicule - because they are acting like idiots. Or liars. Or pollies, I guess.

The only realistic long-term source of energy in the distant future is nuclear fusion. With the raw material being sea water, it can produce all the energy we can use into the indefinite future. The world's first fusion power station is under construction at present in southern France, and may be producing power within ten years. In addition, it does not produce nuclear waste (the waste product is helium gas), is fail safe, and would be very cheap to operate. Let us hope it is operational before the shortage of fossil fuels triggers a major crisis.

plerdsus, I think you may be talking about this: http://en.wikipedia.org/wiki/ITER ... unfortunately it is only a technology demo and won't produce significant usable power.

The main downside of this sort of fusion reaction is that it produces heat, an inefficient path to electricity.

Here's another idea to contemplate: polywell fusion (http://en.wikipedia.org/wiki/Polywell). It looks promising but needs serious funding to explore more fully. One of its key features is that the fusion reaction produces charged particles, so the energy can convert directly to electricity (95% efficiently, claimed). More detail here: http://www.strout.net/info/science/polywell/index.html

The mention of 'growth of demand' not being factored in brings us back to hideously rising populations which are causing more demand for everything.

Growth should be seen as a dirty word by all but those making money from growth, and pushing for higher immigration and populations to make them even richer. There are fewer of them than us, and it's about time we started leaning on our useless politicians.

As for oil: it's been 'running out' for decades now. Maybe it is near it's end, maybe it's not. We would all like to see alterntives (the providers of oil are ripping us all off) but to date, the only possiblity with any practical use is nuclear power. All other forms are OK for hobbyists, but there is no evidence that electricity, solar or wind will, even all together, provided a reliable and practical supply of energy in the future.

Many people are against nuclear power, including our own Government, so there's not much hope for us if we are to believe the people who have become professional scare-mongers.

Sorry PhilipM, the calculations on when fossil fuel reserves are likely to run out are almost certainly wrong. You may be out by a century, perhaps several. Who knows? There have been forecasts that easy lift (ie cheap to extract) petroleum will run out some time soon, but no-one is seriously suggesting we will run out of fuel. Instead, the concern is that the switch from cheap to expensive oil will be disruptive. I have no comment to make on those forecasts but it is likely that the recent spike in petrol prices was due to some short term factor, rather than the long-term decline in easy lift oil.
However, no one aside from the occasional rapid environmentalist has suggested that there might be an end to coal. The reserves figure you are using almost certainly bears no relation to the amount of coal that can be exploited - as has been shown time and again the reserves figure for minerals is influenced by price. If coal is worth more there is more exploration, ergo more coal is found. This relationship is true for all resources - even oil to a certain extent. Leave it with you.

At last.... an article that says it the way it really is.

I'm of the opinion we have very few avenues left now that we have allowed Peak Oil to catch the powers that be by surprise. One of these avenues is to live more simply, so we may simply live, to quote Ted Trainer.

In our household, we have proven beyond any doubt that it is possible to lead a far more satisfying lifestyle on a fraction of the energy budget we all take for granted.

We generate over 90% of our electricity with a combination of solar and efficiency (and could easily make it 100% with some effort from our kids!), and we grow much of our own food, including this year the exciting prospect of making our own cheese from organic goats' milk. Food creation is one rarely disclosed area where much of our energy is used up. My car ran out of rego 18 months ago, and that was that. We now save so much money by NOT participating in the economy, that my wife only needs to work five days a fortnight to cover all our expenses including her pottery habit.

If only she'd agree to get rid of her car.... we'd be able to pay the rates just with cheese I estimate!

Curmudgeon you may be right that we will find more copper and zinc if we look harder due to high prices. That could be true of gas to some extent (think hydrofracturing), but coal and oil are different. The most recent good sized oil discoveries have been way offshore and even then under kilometres of seafloor rock. When it takes as much energy to extract and refine as it can produce then the whole exercise is futile whatever the price. Mining of fossil fuels is different to metals and diamonds because they not only have to break even in energy terms but still have enough surplus energy to power the rest of the economy. Limiting CO2 places an extra constraint. As far as I am aware nowhere outside of Iraq can profitably produce a new oil field at $50 a barrel. Basically what we have now is as good as it gets. Look at the UK; their once mighty coalfields in Wales and Yorkshire are now uneconomic as the remaining coal is too deep. High oil prices didn't help the Brits find more oil in the North Sea and they are now oil importers, not exporters. They also now depend on Russia for 20% of their gas with unhappy results. If coal, oil and gas can run out or become uneconomic for the Brits why can't it happen to the world as a whole?

Sorry to tell you Curmudgeon.... but you are wrong. The US, the largest producer of coal in the world, hit peak COAL ENERGY 20 years ago. Anthracite, the best coal of all, is as good as totally mined out, and more and more coal, of ever worse quality, needs to be exploited, and more and more energy spent in the process, all the time, just to tread water. The exact same thing applies to oil too.

You are right that we will never run out of oil, because one half to one third of what is left is so energetically expensive it will never come out of the ground.... it would take more energy to exploit it than it contains.

You should visit http://www.chrismartenson.com/crashcourse

It seems to me that we really need to think and act outside of our current rigid boxes re the nature of energy altogether---and how we can generate, harness and use it.

What about the ideas and inventions of people such as the genius Nikola Tesla or the relaitively unknown James McCanney.

Then there is the entire spectrum of possibilities featured on and via this website: http://www.borderlands.com

The glaring error in this article is that it doesn’t identify who the ‘we’ is who is to take the action. ‘We’ – all human beings, taken individually - are already taking action to provide ourselves with the the resources we want in the future, in order of our priorities and in view of the pay-offs.

But as soon as we talk about policy, the ‘we’ means the state’s power of compulsion and coercion. We are talking about using force - police and prisons - as the basis of social co-operation.

It is an error to see all the problems in terms of positive science. This is because the science does not give us the end values people are striving for. The use of policy necessarily imports the requirement of ethically justifying the use of force. Once we ask whether the use of violence or threats is justified to achieve the chosen ends, the argument crumbles, both as to ethics and pragmatics.

What makes the author think that he has got a better grasp of the problems and solutions, the costs and the benefits, than the billions of people who are already working on the problem according to their own values and their own time preferences? The entire arrogant approach of presuming to abstract the problem from the individual values of the people involved, decide in aggregate what the solution should be, and then using force or threats of force to implement it, is erroneous and should be condemned. It has failed over and over and over again in human affairs. There is not the slightest reason to think that bureaucrats can centrally plan the world’s ecology. There is not the slightest reason to think they can centrally plan the efficient use of the world’s resources.

Sustainability is merely the catch-cry for the new generation of officious meddling totalitarians, making all the same mistaken assumptions as the last lot. Having failed to achieve the ideal society by central planning of the economy, they now aspire to achieve the ideal society by central planning of the ecology *and* the economy.

No, Diocletion. Look deeper - it's about peace, not war.

Spare me the pretension of superior insight.

So the idea is to systematically use violence or the threat of violence on a global scale in order to achieve a more peaceful result than peaceful production and exchange, is it?

If as you say it's about peace not war, then why not just *not* use aggression in the first place? Why is violation of life, liberty and property the answer? Why is policy the answer? Answer please?

Do you think causing human death is justified in order to achieve sustainability? Answer please?

How many people should die to achieve your vision of ecological sustainability? Have you even thought whether your policy program involves causing human deaths? Answer please?

If you restrict the use of a particular resource to achieve sustainability, how are you going to know whether it has the effect of causing human deaths? Answer?

If forcibly restricting the use of resources that now serve to provide food, medicine, or other necessaries, results in human death, how are the 'sustainability' school not advocating the causing of those deaths? Answer please?

The new totalitarians want to use violent coercion against the whole of society that disagrees with them, and then have the gall to talk down to others about their purpose being peace not war.

Diocletian, you wrote;

“Sustainability is merely the catch-cry for the new generation of officious meddling totalitarians…”

Oh collywobbles!

Whatever happened to our discussion about this on the ‘Framing language, changing meaning’ thread? You dropped it like a hot potato! http://forum.onlineopinion.com.au/thread.asp?article=8323#131323

“I propose we stop worrying about who is right and wrong in the climate change debate, and move as fast as we can to sustainable energy.”

I certainly support that Philip. But why stop at sustainable energy? Why not go all the way to a sustainable society…and with considerable urgency?

Concern about climate change needs to evolve into concern about overall sustainability, which necessitates stabilising our population and developing a steady-state economic system.

There’s not much point in moving into a sustainable energy regime if our population is just going to continue to rapidly increase and our absurd continuous-growth based economic system just blunders on, thus increasing all sorts of resource and environmental pressures.

An outstanding contribution Phillip. I agree that moving as fast as we can to sustainable energy does require true leadership and resolute political will. Obama seems to appreciate then need for bold, whole of government renewable public policy. By contrast, our carbon pollution reduction policy mix is a confusing mess that is doomed to a humiliating failure in a few years after its introduction.

Charging for pollution permits and then giving most of the money back to the big polluters has set an awful precedent and gives all the wrong signals to the markets, the public and the world at large.

Rudd's assitance to NSW in building new rail links to boost coal exports to China, in deferance to our coal barons, will one day be regarded as his crime against humanity. As the polar and tundra regions melt and a new hostile climate equilibrium approaches, we need to take a rational planned approach to reducing the greenhouse gas content of our atmosphere involving population control and simpler living where we strive to attain clean energy self-sufficiency for most housholds and as a nation.

Excellent article.
Battery cars will take over when they perform better and are more convenient, not before. (No coercion needed Diocletian!) The recent oil shock will kick-start the final push for this I think. Once mature, electric cars will make internal combustion look like steam locomotives. This is not just wishful thinking, I've been "hands on" for a while now and things are finally looking up!
Leigh. Massive scale solar plants that heat oil are operating right now in Texas. By heating oil power can be produced for hours after the sun sets. Computer controlled grids (unlike the 19th century rubbish we run now) will enable load balancing despite the coal lobby cry of "base load must be coal/nukes". Cost per Kilowatt is comparable to coal without any subsidies. Technology is not really the issue: investment and clear government policy is, as is the FUD created by the industries that our society currently relies on.
Sadly, we are probably dependent on the likes of "BP". Hopefully "Beyond Petroleum" is more then just a cute marketing slogan.

Diocletian, correct me if I'm wrong, but you come across as one of those long-haired hippies with an arts degree in a useless subject, who never take a bath, and who distrust anyone who knows the difference between a limited slip differential and a differential equation :)

To your argument: "we" are the same mugs who are spending up to $10-billion dollars of our money a year (various calculations e.g. see http://www.smh.com.au/news/national/public-purse-props-up-fossil-fuel-industries/2007/05/07/1178390228019.html and http://www.isf.uts.edu.au/publications/CR_2003_paper.pdf) courtesy our government to prop up fossil fuels in various subsidies that make neither economic nor environmental sense.

Consider the car. Cash handouts to keep nonviable factories going. Roads are heavily subsidized. The perverse fringe benefits tax system where you pay MORE tax if you use your car LESS. In Brisbane, the Greens proposal to spend $3-billion on light rail is scoffed at by the big parties -- who are spending over $2-billion dollars on EACH of several road tunnels. These tunnels will not get close to cost recovery even with a toll higher than the train fare over a similar distance.

So a simple answer to your question: "we" are already spending the money I would like to see spent, but on technologies of the past, not the future.

If you think you are living in a pristine free market economy with no government intervention, dream on.

Come now Philip M there is no need for silly abuse. As for Coorandgreeny .. no, sorry, the stuff you read about the good coal being totally mined out would apply only to certain deposits. All attempts to put global limits on specific resources is so difficult that no-one bothers these days.. even if what you say about that type of coal is true it is only marginally relevent.. some good sources of info are the International Energy Association, the US Department of Commerce and Energy and, locally, ABARE.. ( www.abare.gov.au) which produces an excellent resources quarterly

Thanks, Curmudgeon. I'm sure Diocletian has a sense of humour. He must have to use that pseudonym with his views, given that the eponymous Roman emperor created "largest and most bureaucratic government in the history of the empire" (http://en.wikipedia.org/wiki/Diocletian).

I know about those resources. The International Energy Association is not that far off agreement with me (http://www.iea.org/textbase/press/pressdetail.asp?PRESS_REL_ID=275).

Surely you must agree that the sound policy approach when faced with a reasonably high probability of a massive change in the energy economy is to start on the things that are easy to change, and invest in R&D for the ones that aren't?

I never ceases to amaze me how inefficient energy use is in this country. You can walk around the centre of Brisbane in air-conditioned comfort IN THE STREETS because buildings have gaping portals instead of double doors as is done e.g. in the US. Spending billions on tunnels when you could do good public transport for less seems to me particularly short-sighted.

I thoroughly agree with the inefficient energy use. I'm sure that's right. And we should not be wasteful.

But, no, there is no forseeable end to the use of fossil fuels. If you saw any limit given by the US energy people its probably simply a short hand way to refer to known reserves, and unconnected with any possible date those reserves might run out. Go back in 10 years and the figure will be the same or larger.
Now there must be a limit somewhere but the interaction between price-reserves-technology-demand-supply-infrastructure and resource substitution is so complex that any sort of forecast is nearly impossible. All you can really say is that prices for all commodities have been falling steadily, in real terms, for decades - wild swings aside - and I believe that applies to oil as well..

Curmudgeon, oil is probably at something of an inflation-adjusted low right now but the previous spike was a record even allowing for inflation by about 50% over the last spike. You can't take a recession-driven price drop as indicative of a long-term trend (even if you don't believe the recession was influenced by energy prices, a rapid decline in economic activity has collapsed the energy market).

I've found plenty of (sometimes expert) opinions that supply is becoming harder, and that price volatility is to be expected even without supply problems. Why would you want to rely on a commodity with either of those problems, let alone both. Here are a few articles (not requiring subscriptions to read). Would you care to share your more optimistic sources? Thanks.

http://www.energybulletin.net/node/3272
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1153749#
http://www.wtrg.com/prices.htm
http://www.marketoracle.co.uk/Article6153.html
http://www.financialsense.com/editorials/mckillop/2008/0421.html
http://www.eia.doe.gov/oiaf/aeo/otheranalysis/aeo_2008analysispapers/woppt.html

Sure oil's last peak was a high - or at least I won't argue the point - all the peaks I have know have been highs.. It is possible that the ongoing shift from easy-lift to more expensive oil may push up real prices for a time.. not sure on that point.. and the difficulty of finding major reserves may indeed be making supply more difficult .. and the Russians have not helped with major restrictions limiting investing in their industry - but again that does not change the argument.
The problem with forecasting oil reserves and prices is that events like tech breakthroughs can throw it all out the window.. this happened with the Canadian oil sands recently.
As for forecasting reserves in coal and LNG (both of which, can be made to substitute for oil if needs be).. energy forecasting is so complicated that everyone outside the green movement has given up (recent oil industry forecasts for the end to major reserves dealt with a specific case - and even then I don't think they got it right..) Anyway, hope your thesis goes well...

It seems to me that the base line, if you will excuse the pun, is that
oil production, all liquids, is stuck at around 85 Mbd since May 2005.
The last oil price spike occurred when demand leaned on the supply
rather hard and the price shot up with a bit of aid from speculators.

Unfortunately this coincided with the interest rate increase on all
those sub-prime loans in the US and up went food & petrol.
Many more than expected defaulted on their loans and the insurance
was inadequate and so here we are.

The recession pushed down demand and we await a recovery and another
increase in oil prices and what will happen when demand reaches the
production level again ?
This cycle will repeat several times hopefully and it will wake up
Kevin Rudd and company.

As it stands now Kevin Rudd is pushing to build more freeways (ABC TV)
and so we cannot hope for help from that quarter.
The policy makers in government simply do not understand.
The problem is that the money to do what is necessary to prepare for
energy depletion will have been spent on airports, 2nd airport for
Sydney, road tunnels for Brisbane, more freeways for Melbourne (ABC TV).
While public transport and projects like solar thermal power station
modifications go wanting.

Some experts think we may only get one or two cycles of the oil price
spike-financial crash so the politicians will have to be fast learners.
On the past pereformance I think thats a forlorn hope.

The real problem is that the victims of the bust side of these boom and bust cycles are the most vulnerable. The poor or marginally employable often have to travel far to get to work. Make petrol really expensive, and they are stuck at home when they could be out looking for work. Sure the market will eventually fix the problem – but at what cost? It's not as if we live in a pristine free market economy. Fossil fuels are heavily subsidised, and are getting more in the cause of "jobs" (in an industry that's increasingly capital rather than labour intensive, and has a history of shedding jobs fast on its down cycles).

If only we had the leadership the Americans are lucky enough to have now... so much depends on Obama actually delivering not so much because he is so good (which we can only really determine with hindsight) but because the rest of the world's leadership is so pathetic (which we can see now). If he fails, the consequences will be really scary.

Hi again Philip.

Regarding McKay's essay: McKay’s conclusion is to

1. electrify transport - this reduces oil consumption in favour of electricity production.
2. use heat pumps for air and water heating.
3. use clean coal and nuclear electricity – this translates into “use nuclear electricity” because clean coal doesn’t exist, and besides he advises it is only a “stop-gap” as coal will run out relatively quickly.
4. transmit renewable energy from other countries (eg solar power from deserts) – no mention is made of the enormous cost of this, in particular the cost of HVDC transmission systems.

McKay’s ultimate conclusion is this: Renewables cannot provide enough energy to satisfy current or future demand. But he concludes that nuclear fission (fast breeders with seawater extraction) can provide enough energy for all humans on the planet, and represents a major part of a sustainable long term solution.

McKay addresses the issue of intermittency in renewable energy by

1. promoting the notion of pumped storage. (highly inefficient, dependent on hydro resource availability - which Australia lacks) 2. suggesting that more geographically separated plants reduces the impact of intermittency (misleading)

The problem with renewables is that even though the more plants you have, the smoother the flow of power, there is still the small chance that there will be an extensive calm period on a cloudy day when tidal flows are slack. In which case, you must have a very large capacity of idle stand-by gas plants to kick in at a moments notice. Technically, this is not a huge problem, but it is a huge economic issue. It is very, very expensive. McKay, by failing to address the economics of the issue, glosses over the problem posed by intermittency in renewables. The reality is that the economic restriction created by the need for redundancy, and availability of hydro resource, limits renewable to a fraction of total capacity. The bulk of supply must come from reliable baseload sources such as nuclear power.

regards,

Greig

Greig, McKay was also a bit weak on the weaknesses of nuclear such as massive environmental damage from mining and fuel refinement, and the tendency for all the money to be focused on technologies with military applications.

Also be careful of taking his examples over wholesale to Australia. Heat pumps for example have a much easier time here because an air-source heat pump works well most of the year in most of Australia, whereas Europeans need much more expensive ground-source heat pumps to take them through winter. They also don't have much sunshine to work with, or much spare land on which to plant biofuels crops that grow on land unsuited to agriculture.

Back to nuclear ... Thorium for example can in theory be used for a process with much shorter half-life and no military potential, but it has hardly been explored. Most current work is in India. See more at http://en.wikipedia.org/wiki/Thorium_fuel_cycle – the theory looks good but not much has been done.

Uranium is not a great choice for fuel because the quantity available is too low and it will run out quickly if there's a massive building program. It also has largely been developed along lines that make weapons relatively easy to develop out of civilian technology.

Maybe some countries in Europe will go nuclear in a big way but it's not a general solution. Would you like every unpredictable police state to have access to significant nuclear resources? In any case the limited acceptability of nuclear is not just my opinion. The IEA's World Energy Outlook 2008 Edition http://www.worldenergyoutlook.org/docs/weo2008/WEO2008_es_english.pdf sees nuclear as dropping from 6% of primary energy production to 5% by 2030 (its share of electricity goes down from 15% to 10%).

Working out ways of managing load and matching to capacity is not an impossible problem, just very hard. We can manage a technology as chaotic at the basic architecture level as the Internet with remarkably few failures. Instead of saying "too hard" and giving up, we need to start working on these problems now. They will not go away, nor will they solve themselves.

Philip,

Could you please explain how an air-source heat pump works, and how it would be used for cooling in Australia.

I am glad that you have recognised that matching load and capacity is a difficult problem - in fact it is THE problem in energy production. I note you make no effort to present any solutions, but I'll have a crack...

In my opinion as renewables increase in Australia under the MRET, and energy supply becomes more and more variable and unstable, I can see small urban located gas turbines for peaking load becoming very popular. But in Australia the problem is that piped gas is not yet well developed ... as the Moomba gas fields will be exhausted in less than 20 years. We need new gas pipes from PNG or the NW Shelf or access to local coal seam gas, and we need to start building very soon or rolling blackouts wilol become very common.