Peak Oil: How will our lifestyles change? Or is it Quackery.

It is clearly not impossible, unless one resorts to arbitrarily restictive no-true-Scotsman definitions of what counts as “comparable” in order to exclude some of the prototypes that have already been built and tested. In any case, including “transportation infrastructure” as one of the criteria not to be changed is simply making the claim trivially true by definition (since, of course, changing from hydrocarbons to batteries or hydrogen or banana peels or whatever involves replacing the infrastructure of gas stations with a new infrastructure for the substitute energy source) and thus meaningless.

Some peak-oil skepticism from a LW quarter: Investigative journalist Greg Palast’s 2006 book, Armed Madhouse, Chapter 2: “The Flow”:

(Palast does not seem to understand that Hubbert’s original 1956 prediction was that United States (not global) oil production would hit its all-time peak in the 1970s, which it did; nor that the “peak” is to be followed not by a “crash” but by a gentle downward slope of production as each barrel of oil, with each passing year, costs more and more to extract; nor that global consumption of oil is not a constant but will increase dramatically as India and China become more industrialized; but let all that pass for now.)

Hubbert, Palast points out, was a geologist employed by the oil industry (as are practically all the geologists of the Association for the Study of Peak Oil). His 1956 study is labeled “Publication No. 95, Shell Development Company, Houston, Texas.” At that time, oil was abundant; the price of crude was $2.77 a barrel, or a nickel a gallon, and sinking; new discoveries worldwide were driving down the price still further. Hubbert’s study, in Palast’s view, was propaganda intended to serve the industry’s needs.

Elsewhere in the same chapter, Palast fills us in with some background on the economics of the oil industry. The five big international oil companies own some oilfields of their own, but they have to buy most of the oil they refine from the nationalized oil industries of the OPEC nations. You might think they would want to buy it as cheap as they can, so they can pocket the difference, or else charge less at the pump and sell a lot more gasoline, but it’s not that simple:

This argument ignores the inertia imposed by market-entry costs – a massive amount of inertia in the case of transportation infrastructure. The fact that it takes fuel costs greater than $6/gallon to push the system over that hump does not imply that, once over the hump, the cost of the new infrastructure will necessarily remain at the equivalent of over $6/gallon.

I should’ve been clearer . . . see post #12.

People have been talking about the high cost of oil and the need for alternatives since the seventies. How long do you figure it’ll take the new technology to kick in?

My personal opinion is that I invented a method for making fuel at the equivalent price of two dollars a gallon, I’d find investors quickly and we’d have the infrastructure running within a couple of years. After that, it would all be hookers and blow and Hugo Chavez could kiss my ass.

Here’s an analogy. I win the lottery and start living a lifestyle that costs me $200,000 a year. My friends say “Hey, Nemo, don’t be an idiot, you’ve only got so much lottery money. Once you spend it all, you’ll be poor.” And I say, “No, don’t worry. Once I’ve spent all my lottery money, I’ll just figure out some other way to get the $200,000 I need each year. But there’s no reason to worry about that problem now because I have still have lots of lottery money left.” But I’m ignoring the fact that I was never able to make $200,000 year in the past, why do I think I’ll be able to make it in the future? Winning the lottery was a one-time event and once that money’s gone, I’ll never live at that level of wealth again. I won’t starve to death - I’ll just get a job and go back to living a middle-class life again.

That’s what oil is like. We’ve been living off a cheap finite source of energy for the last hundred years. But we act like our current level of energy is permanent and that when oil runs out, we’ll figure out some other source of equally cheap energy. But there’s evidence to support that belief; we haven’t found that cheap alternative yet. Maybe when oil gets scarce, we’ll just have to adjust to an economy where energy is expensive. Like me after the lottery money is gone, we won’t starve but we won’t be rich either.

So if we don’t like what the theory is called we can rename it. How about, Adjusted Income contingent on supply of hydrophobic, lipophilic, liquid organic material - that is finite. There will come a time that cost is too high, because oil is too scarce and we use other materials for energy. Investing in that kind of technology has to have a begining - I think we’re pretty close. Also, there are many people out there studying this trend to make predictions on when we will reach that scarcity level and nearly all of them point to alternative fuels to alleviate the dependency on fossil fuels.

“For five years, I had been flying around the country telling college lecture audiences and conference-goers that our fucked up everyday environment of strip malls, tracts houses, outlet malls, parking lots and other accessories of the national automobile slum was liable to put us out of business as a civilization. I asserted that the culture growing in this foul medium had gotten so bloated and diseased that it would succumb sooner rather than later to its own idiot inertia. I still believe that today. It is both a conviction and a wish, because to go on in our current mode would be culturally suicidal.”

Kunstler explicitly wishes for the end of Western civilization in its current form. He explicitly desires its replacement by a small-scale, regional civilization built on farming and locally-made goods that are not mass manufactured.

And he hasn’t changed his views since that Y2K article. This interview about that novel of his you’re so enthusiastic about (linked on the front page of his own personal website) contains the following exchange:

"Q: The world in World Made By Hand is very grim, but there’s some beauty in it, too.

A: I’d contest the idea that I’m presenting a wholly grim world. It’s a world that’s very different, a world in which there are quite a few challenges and quite a few losses, but I’m not at all convinced that the people are necessarily more miserable. Their medical care has become much more primitive, and they work harder, but they’re working very directly with their neighbors on things that matter to them. Their ceremonies are much more direct and social in nature – in other words, they party a lot. They’re also continuing to go through a transition. Their way of life is not settled – they’ve left behind the world of happy motoring and consumerism and cheese doodles and Pepsi-Cola, but they’ve entered a world in which the terrain of everyday life is once again very beautiful. Their best friends are no longer made-up characters on TV shows, they’re eating food that they’ve raised themselves and requires some skill to process, and they’re making their own music. So what I’m describing is a world of social riches that we’ve left behind – left behind in our eagerness to become the slaves of our electronic gadgets.

Q: It sounds almost like you’d welcome this world.

A: Let’s say there are elements that I’m not fearful about."
How is that not Luddite, especially in light of his earlier stated “wish” that modern Western civilization (which he calls “bloated and diseased” - I don’t know about you, but I generally don’t use those words to describe things I like) come to an end?

Our life styles have already changed. Call it OPEC greed or overreaching. The major oil producers are finding out what happens when you squeeze too hard on your customers. They thought that they had the U.S and the EU by the nutsack. Guess again.

The Middle East and other OPEC members have basically one commodity to sell, when you attempt to control your customers the customers will respond.

I will hang on to my 99 Ford Escort beater car until it dies, thanks to OPEC. I am willing to bet that there are many people in the western world who feels the same way.

I bet China and India wasn’t and isn’t pleased either with OPEC’s tactics.

The free market still prevails for the most part. Suck it OPEC.

This is not going to help with oil consumption nearly as much as perhaps you think it will.

I can say my mother was bloated and diseased when she died (she was). Doesn’t mean I didn’t like her. I wished for her passing, but only to end her suffering.

What about Kokopilau’s point that Kunstler was saying exactly the same things about Y2K that he is about Peak Oil now? Doesn’t that support the notion that he has a desired end in mind, and is/was just looking for the means by which it’ll come true? If not, why not?

The catch is that you only get to "the equivalent price of two dollars a gallon"after the overall market for some alternative grows big enough to spread a lot of startup costs over a humongous number of gallons. In the beginning, the equivalent price is more like ten dollars a gallon, because those costs are spread over relatively few gallons.

That’s the hump that needs to be climbed. Painful, yes, but hardly the sort of gloomy (for rational people) or gleeful (for puritanical Luddites) scenario of permanent scarcity posited by the “peak oil” crowd.

The conclusion that the basic underpinnings of Western Civilization will fall into ruin depends on supporting claims that I’ve already dismissed as being based on the dubious claim that technology can’t do what it has in fact already done. The fact that energy infrastructures will need updating to translate these technologies from the prototype stage to actual mass utility is trivially obvious.

While I’m sorry about your mother’s passing, your analogy nevertheless proves my point: despite your claims to the contrary, Kunstler indeed wishes for the end of Western civilization as we all know it, and would like to see it replaced by a local, agrarian, more primitive way of life that’s akin to 16th/17th Century Europe.

Thomas Hobbes, who actually lived in the type of world Kunstler so foolishly idealizes (unlike Kunstler himself, a man that despite his Luddite leanings apparently has no problem flying jets around the country and using the Internet to promote his apocalyptic fantasies), wrote in The Leviathan that a life without industry and widespread trade would be “solitary, poor, nasty, brutish, and short”.

I think Hobbes’ assessment of a world where Western advances are rejected to be a bit more accurate than Kunstler’s romantic delusion regarding the same thing.

Kunstler is elevating minor quibbles to the status of major roadblocks. He raises three issues, claiming that none of the available alternatives:

  1. “is as versatile as gasoline”: For purposes of running the fleet of “cars and trucks”, it doesn’t have to be particularly “versatile”; it just needs to do the basic job of making the wheels turn. “Versatility” is more likely to be an issue for air travel; at most, the cost of flying might increase somewhat as airlines have to outbid other uses for the available oil (with the price pushing those other uses toward alternatives).

  2. “or can be produced for anything close to the cheap price of gas we’ve been accustomed to”: In part, that’s a result of the economy-of-scale issue I mentioned in a couple of previous posts. To the extent that alternatives may turn out to be inherently more expensive than gasoline, the transition is comparable to the effects of the fuel price increases that have happened on and off during the past decades: annoying, but hardly enough to threaten to the basic ability of people to live their lives as they like (rather than the way Mr Kunstler likes).

  3. “or can be stored or transported as easily”: The differences between alcohol, electricity, etc on the one hand and gasoline on the other are matters of a somewhat larger percentage loss in transit, somewhat larger storage tank requirements, etc. Again, this is a marginal issue, comparable to the inconvenience of gas going another dollar a gallon.

The Heinberg Article I linked to above talks about the doom and gloomers and their effect on the real problem at hand. There is a larger issue embedded in the facts of the problem, and people deal with that in different ways. Some deny the existence of any issue at all, others get overwhelmed and block it out and still others try and come to reasonable conclusions.

I think it’s a mix between the inevitable and a productive solution.

Quoth the esteemed Una Persson:

Not directly: I’m aware that oil represents only a negligibly small percentage of US electrical generation. But many of the alternative technologies which would decrease dependence on oil (electric cars or trains, for instance) depend on electricity from the grid, and hence ultimately on whereever that electricity is coming from. If we were to convert a major portion of our transportation energy use to electric, we would need more power plants, and it’d be better if those power plants were based on renewable sources.

Further, coal (which supplies most of our electricity) has all the same issues as oil: Yes, we have a lot more coal, and a lot of it is here in the friendly USA, but it’s still finite and will run low eventually. Peak coal is just as real an issue as peak oil; it’s just further in the future. And there’s no reason not to start addressing that right now, too.

I think one of the points that most people miss when talking about how alternative energy systems will replace oil, once oil becomes too expensive, is that because oil is such a large portion of our current energy supply, as it becomes prohibitively expensive, everything that we use it for will also rise in price.

ie: any commodity that is mined, transported, refined, processed etc will increase in price as oil increases. (this includes oil drilling and tar sands processing)

You can’t make solar panels, electric cars, algae ponds, nuclear power generators, etc. out of electricity… you need access to afordable oil in order to create the infrastructure with which you hope to replace the decreasing oil supply.

This is why so many peak oilists sound like chicken littles… you can’t wait until the cheap oil runs out before you have a backup plan in place.

There’s probably no product that would be more readily accepted than a cheap energy alternative to oil. Anyone who has a realistic proposal would be drowning in investment money. And this has been true for over three decades. But despite this, we’re still using essentially the same technology.

Sure there is. You want to invest your money in the things that have the biggest payback. That may not be dealing with “peak coal” out in 2100 or so. Instead it may be in health care, cancer research, AGW, prevention of hunger in the third world, education, etc.