Re: Peak Oil
- From: "David Ewan Kahana" <dek@xxxxxxx>
- Date: 30 Sep 2005 01:29:33 -0700
widsith wrote:
> David Ewan Kahana wrote:
> > widsith wrote:
> > > dkomo wrote:
> > > > John Bode wrote:
> > > >
> > > > > Robert J. Kolker wrote:
> > > > >
> > > >
> > > >
> > > > >
> > > > > Our industrial economy is wholly dependent on an ever-increasing supply
> > > > > of *cheap* energy. None of these alternatives is going to be as cheap
> > > > > as oil is now. By the time the cost of oil makes any of the
> > > > > alternatives look attractive, our economy will have already collapsed.
> > >
> > > Although Ill disagree with dkomo in a moment, Im joining him as the
> > > devils advocate.
> > >
> > > First, stop focusing on oil. Our industrial economy _currently_ uses
> > > oil for approx 1/3 of its energy needs. (Source:
> > > http://energy.cr.usgs.gov/energy/stats_ctry/Stat1.html) Oil is
> > > primarily of vaule as the source of our mobile energy needs. I believe
> > > that less than 10% of our electricity is generated by oil.
> > >
> >
> > Yes, *far* less than 10% of electricity, I would say only
> > about 2-3% is currently generated by oil. Electricity is
> > produced mostly by coal fired plants, LNG fired plants, and
> > nuclear plants now: oil has been pretty much phased out, though
> > e.g., there is still one oil fired plant here on LI.
>
> Less than 10% was a figure from memory from some research I did
> regarding coal use about 5 years ago. It was not meant to be exact.
>
Fair enough ... my attempted corrections aren't meant
to be exact either: or at least they didn't come out
that way ;->
I wouldn't have known anything close to an exact figure except
that I recently had an argument with an older colleague who
seemed to think that we still used a great deal of oil for
electricity production. So it just happened I had looked it up.
Only about 10% of oil goes into non-fuel uses overall.
> >
> > Overall, 1/3 from oil seems a little bit low. I find a figure of
> > 40% from the following source:
> >
> > http://www.eia.doe.gov/emeu/aer/pecss_diagram.html
> >
> > The breakdown in primary energy sources seems to be currently:
> >
> > 40% petroleum
> > 23% natural gas
> > 22.5% coal
> > 6.1% `renewable'
> > 8.2% nuclear power
>
> That jives roughly with the page I used.
>
Sorry ... I see that I made a mistake above. The units
are not actually percentages on the link I provided.
The numbers are energy consumption in quads. The
sum of the five sectors is: 99.8 Q, so that this doesn't
make much difference actually. On your page, the sum of
consumption is 94.27 Q, the difference presumably being
the growth in overall energy use from 1998 to 2005. The
percentages do seem to jive very well, but we see that
36.6 Q in oil use has now grown to 39.8 Q.
In any case, the total percentage from oil does seem to
be about 40% in both cases, and it's far and away the
largest single energy source. The percentage from
fossil fuels overall clearly dominates the total: at 85%.
But your point is a very good one, one certainly should not
focus on oil alone.
> >
> > Of this total energy 28% goes into transportation, 22% into
> > industrial uses, 11% into residential + commercial uses, and
> > 39% into electric power.
> >
> > I don't know quite what the source of the difference is
> > in these figures. Oh, but I see you said `industrial economy.'
> > Maybe that's it?
>
> Nope, I used 'industrial economy' in response to the OP's use of that
> term. The page I quoted cites 38.8%. Yours - 39.8%. Your site lists
> 'petrolium' while mine, 'oil', perhaps shad accounts for the remaining
> 1%? Either that or the difference is due to the year the statistics
> are from. Energy consumption is variable enough that one year would be
> enough to account for that. (Another 750K SUV's anyone?)
>
Yes, I think most of the differences are probably classification,
and the variation over seven years.
> I used 'approx 1/3' since the exact amount didnt matter to my argument.
> I was simply pointing out that Oil isnt the whole story, nor even a
> majority of our economy's energy use.
>
And that's a very good point, which I agree with.
Of course, most of the other current sources are exhaustible
in the same way that oil is, though the time scales are
different.
> > > Secondly, while the total cost of various types of energy is debated,
> > > even environmental sources list nuclear as approx 50% greater than
> > > coal. (http://www.greens.org/s-r/11/11-09.html) I dont think that a
> > > 50% increase in the cost of energy will cause the economy to come to a
> > > grinding halt. (Keep in mind that oil prices have increased 100% in
> > > the past few years and we havent collapsed yet.) More nuclear friendly
> > > sites list the cost as less than coal.
> > > (http://www.uic.com.au/nip08.htm)
> > >
> >
> > However, inflation adjusted oil prices are still well below the 1984
> > peak in world prices, and a fair percentage of the increase has
> > arguably been due to a fall in the value of the dollar against world
> > currencies.
>
> Depends on what you mean by 'a fair percentage' but yes.
>
Well, it's hard to quantify, but my thinking is that oil
producers and sellers are not idiots and realize that the
dollar is dropping, so they attempt, with some degree of
success, to set prices so that they obtain a constant
income in relatively hard currencies.
Over the last five years, USD/EUR hit a low of 0.85 in
Jan 2001, and peaked at 1.35 in Jan 2005, for a ratio of
about 1.6.
http://www.ecb.int/stats/exchange/eurofxref/html/eurofxref-graph-usd.en.html
It would be better to take a basket of hard currencies,
but I think you'll find relatively similar figures for
something like the US dollar index.
Oil prices were $30 in Jan 2001, and hit $50 in Jan 2005.
So over that time period, dividing by the change in dollar/euro
gives an equivalent cost of $30. Since then, dollar/euro
has reversed, but we're still seeing a sharp rise in oil prices.
In my opinion, price right now is being largely speculatively
driven, though I'm not currently short oil ;->
http://futures.tradingcharts.com/chart/CO/M
> > There is no real sign of current shortage in the oil supply.
> > I would not argue that there is. At some price point, it seems
> > clear that there would be major fallout in the economy ...
> > say $200 or $300, or more per barrel. I don't know where
> > that point is.
>
> Neither do I, but I think youre in the right ballpark. My point was
> that there are known technologies that will become economically favored
> before that point, technologies that do not have as sharp a resorce
> constraint. (Coal liqification anytime between now an another
> $50/barrel, nuclear in another $20/ton in coal prices.)
>
I agree completely with your point.
> > Environmental estimates of the cost of nuclear energy are quite
> > frankly nonsense. The major economic costs of building
> > nuclear power plants are largely due to the extremely long
> > legal delays in building them which in turn arise from highly
> > exaggerated public concerns over safety. Early nuclear plants
> > were built far more quickly and at lower cost, and produced
> > electricity at costs only inferior to those for hydroelectric
> > generation. It goes without saying that the energy density
> > of the source is highest for nuclear power.
>
> I used environmentalists numbers, not because they were accurate, but
> because they are the most pessimistic and I could still make my case
> with them.
>
Fair enough. I would argue however, that it will become essential
to use nuclear energy, and that one should direct some focus
also in that direction, since it is in fact practical and
can make some impact on the 85% figure that's coming
from fossil fuels, if not immediately on the 40% coming from
oil. We're coming to a point now where all alternatives have
to be considered.
> > The most modern coal fired plants seem to approach nuclear
> > in basic economic costs and EROI, assuming the effect of
> > regulation could be neutralised. Hydroelectric is
> > far and away the best in terms of EROI, but it's of
> > course limited.
> >
> >
> > > Thus, we have economically feasible alternatives for our non-mobile
> > > energy needs. Our biggest concern is transportation. How do we
> > > continue to power cars, boats, planes etc? Outside of the maritime
> > > industry, nuclear is not an option. Here liquified coal is a temporary
> > > solition, and one that is economically feasible at current oil rates.
> > > Liquification costs $30/barrel, and unless Im doing the math wrong, can
> > > produce approx 4 barrels per ton of coal, resulting in a net cost of
> > > $40/barrel. (http://www.eia.doe.gov/oiaf/servicerpt/erd/fossil.html)
> > > That gives a $25/barrel profit at todays prices, or an under 8 year ROI
> > > on the $2.2B plant cost. I expect that the reason people are not
> > > building these sites yet is that no one expects oil to stay at these
> > > prices for the next 10 years.
> > >
> >
> > To supply 12 million barrels of oil per day, which is about
> > what we currently use for transportation, we will need to build 360
> > liquefaction plants: the energy cost of running those plants will
> > be enormous, and we will begin to burn up coal at a high rate.
>
> Appoximately US$1Trillion, or 10% of US GDP to build the 360 plants.
> Assuming a reasonable set of assumptions (no increase in
> recoverability, energy use per capita constant, population growth at
> 0.95%/year) we have about 80 years of coal supplying both our coal and
> oil needs. No, its not a permanent solution, but certainly enough time
> to make a transition to yet another technology. (The automobile is
> only about 100 years old.)
>
Your prices I think are correct.
But I'm not sure that's quite accurate about the time
scale. If you wanted to replace all of the oil and coal
with coal, you have to increase the coal production something
like a factor of 3, isn't it true?
Roughly we have 250 years of coal at current usage rates, and
about 100 years if your population growth rate is factored in.
But conversion energy efficiencies are pretty low for liquefaction
.... those 360 plants also take a lot of power, which has to come from
somewhere, so this requires an increase in basic energy production or
import, too. I can't say precisely what the difference would
be, without making assumptions about what would happen
to oil/etc. and running some simulations. But I think it
probably comes out at less than 80 years. It depends on how
much coal you think we have, I suppose.
> > I think we need to replace all cars by electric cars, eventually.
>
> I agree that electric is our current best bet. Im just trying to point
> out that there is an eventually at the end of that sentence.
>
Absolutely ... the eventually is what we want to be sure get to ;->
> > Oil use for ground transportation is about 12 million barrels
> > out of 22 million used per day, so this would help considerably.
> > Achieved over a short enough time it would even marginally affect
> > the growth in world demand, world demand being currently about
> > 83 million barrels per day.
> >
> > If we have electric cars, all possible sources of generating
> > electricity can contribute equally to transportation, including
> > nuclear. I'ld propose doubling the proportion of energy we obtain
> > from nuclear to 16% as an initial step ... that means building
> > 100 new nuclear plants, though.
>
> Unfortunately, that brings up the question of who's backyard we build
> them in. That is the big question, one which I have no way of
> answering, at what price for electricity does the consumer begin to
> accept the presence of a nuclear plant? I mean sure, its great if its
> in the town 50 miles away, but Im sure theyre thinking the same thing
> about you. But at some price-point it will become politically viable.
> I just have no idea how to estimate that point.
>
For my part I was happy enough to have a nuclear
plant right in my own backyard, but the powers that
be turned it off at a net cost of close to $10 billion
which is now being eaten mostly by Long Island
ratepayers ... we must have very close to the highest
electric rates in the whole country.
At some point it becomes necessary for the Federal
government just to invoke eminent domain, I think.
France, for example, just bulled straight ahead with
their nuclear programme and now does some business
selling electricity to Germany I think.
I think nuclear plants should have been built far from
population centres, and there were many problems with
the way in which the nuclear industry was managed. There
are far superior reactors in use in Canada, and the US
should have gone that way. I had the occasion to ask
Hans Bethe about this question and he told me that the
basic reason that the boiling water reactors were built
here in the US, and not the much more neutron efficient
CANDU reactors is that Admiral Rickover insisted on a
scaled up model of the navy design being the model for
the civilian nuclear power industry.
Idiocy.
> > I estimate the chances that this will happen in the current
> > environment as very low ... the Bush administration did initially
> > propose reinitiating efforts on nuclear power generation, it's
> > the one thing I don't fault them on. But they have backed off
> > on that issue.
>
> I guess thats my point, its not what will *this* administration do, but
> what will happen during the next 3-5 administrations.
>
Absolutely right. Step one is the midterm elections. Step two
is getting some people frome the reality-based community in
charge of our energy policy. Without that, nothing good is
going to happen, and we are in _desperate_ need of a long
term policy.
> > > > >>In the short run we can raid mexican and venezualan oil if it really
> > > > >>gets desparate.
> > > > >>
> > > > >
> > > > >
> > > > > Raiding Mexican and Venezuelan oil reserves isn't going to make a
> > > > > difference once oil hits $100/barrel.
> > > >
> > > > Couple of points. How hard is it for Americans to reduce their driving
> > > > by 10% to 25%? Not too hard I would think. Second, how hard would it
> > > > be to improve overall gas efficiency of our trasnsportation fleet by
> > > > 50%? In many cases, not too hard. Take a large SUV or pick up truck
> > > > getting 14 miles a gallon. A 50% improvement would be 21 miles a
> > > > gallon. Almost all small to midsize cars can easily obtain that. What
> > > > about a 100% improvement to 28 miles a gallon? Many cars also get that
> > > > without straining. Hybrid cars can reach 40 miles a gallon or better.
> > > >
> > > > I don't think it is all that unreasonable to reduce our demand for
> > > > gasoline by 25% in the short term, and 50% or better in the long term by
> > > > a combination of eliminating unnecessary driving and trading in our
> > > > pig-mobiles for gasoline efficent cars. This will happen automatically
> > > > as gas prices continue to rise.
> > >
> > > Ill disagree with you here dkomo, since all you are addressing is
> > > consumer demand. I cant find figures on the proportions of different
> > > types of end use, but I would expect that less than 50% of oil is used
> > > by personal vehicles, so even a 50% reduction in driving only results
> > > in a 25% reduction in our total consumption. I believe there is a
> > > significant "fixed overhead" in transportation generated by our
> > > economy. Merely reducing our driving and increasing automotive fuel
> > > efficiency, while a good idea in any case, wont solve the problem.
> >
> > I agree basically, although I don't think driving can be
> > reduced much, not very easily at least. Oil used for transportation
> > is a bit more than 50% of the total. The irreducible minimum oil use
> > for transportation is probably that associated with air travel.
>
> Transportation, but Im not sure how much eliminating unnecessary
> driving and efficient automobiles will effect trucks, trains and
> airplanes. I was trying to esitmate cars. Dkomo posted another link
> showing 28% for cars and 13% for light trucks.
>
Trucks and trains surprisingly don't amount to all that much,
I seem to remember it's something like 10%. I'll try to find
a reference for that, if I can. Automobiles are a big part
of it.
> > Air travel, it goes without saying is crucial to the
> > world and the US economies, and replacing petroleum
> > in that case is going to be quite difficult.
>
> Agreed, the same goes for maritime shipping, although there the problem
> is less technological than political. I mean if we can run a carrier
> or submarine on nuclear power, why not a supertanker or superfreighter?
Absolutely right.
David
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