Points of departure

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Figure. Optical illusion of simultaneous expansion and contraction.


The Swedish blogger Ylven recently wrote a text [in Swedish] about how clueless people are when she tries to explain what peak oil is, even though she leaves plenty of (grim) hints about what it will mean. Either people do not understand the problem at all, or they understand the problem but believe that "everything will be fine". Maybe they have eaten too many Chinese fortune cookies, because, as you may know, such cookies contain only positive messages. When I had some guests over earlier this spring, I told my guests that on my fortune cookie the surprising message was "Oil will peak and you will starve" (everyone in this particular company understood the joke). Looking at my joke in a different light, you may find the seeds of both a public educational campaign as well as a business idea which I gladly share with you - "Peak Fortune Cookies" - with messages such as "Oil will peak and your car will run out of gas", "Oil will peak and you will eat turnip and bark bread", "Oil will peak and you will lose your job", or why not "Oil will peak and you will be drafted to fight a resource war"?

I’m a university teacher and by now I have been able to sneak in some peak oil information as background to other things I talk about a couple of times. The reaction I get from the audience is usually the same as Ylven gets even though I have a "captive audience" who can not immediately stand up and leave the room. Based on a couple of these experiences, I have had to think long and hard about some of the starting points I have personally come to take for granted, and I now emphasize these in my talks in order to increase the likelihood of my point to be understood by the audience. These starting points are assumptions that I have incorporated into my own world view and also arguments that might persuade others. These assumptions are interrelated and they form a logical chain that is easy to follow but hard(er) to refute:

1 Peak oil is now. And if not exactly now, then at least very soon. But already today’s "normal" oil price is many times higher than the price a decade ago, and no one believes that the long-term trend will be broken and that the price will go down in the future. It is difficult today to imagine how we could increase oil production significantly over a longer period of time. Instead, we need to run faster and faster and chase harder- and-harder-to-find oil just to manage to remain in the same place (see the red queen). This claim can be backed up by tables and graphs.

2 Peak Oil is a predicament, not a problem. A problem can be solved, but a predicament has to be handled or countered by adopting better or worse strategies. A predicament can not once and for all be "solved" or "overcome". The fact that we will all die one day is an example of a predicament. You may extend or shorten your life (for example by eating healthy food and exercising or by smoking and taking risks in traffic), but in the end it makes no difference, for you will in any case die. You can not cheat the Reaper; he is standing somewhere, waiting to take you into his arms for the final embrace.

3 Peak oil = peak energy. Oil accounts for around 37% of global energy use and up to 95% of all transport depends on oil. When oil becomes (more) expensive it will become expensive to transport goods (globalization stops) and to transport people (travelling will become prohibitively expensive). No single type of energy and no combination of energy sources may cover up for the steady shortfall in oil production by a few percent per year. In addition, we have already picked "the lowest hanging fruit" also with regards to coal and gas, which together with oil constitute 85% of the global energy production. Furthermore and as the icing on the cake, it is said that there are some problems nowadays having to do with the climate as a result of us burning up all those non-renewable fossil fuels...

4 Peak Oil = Peak Economy. There is a strong correlation between energy consumption and economic growth. We can for sure hope for "decoupling" - to be able to have continued economic growth while maintaining or even reducing energy use - but no country has ever managed this Indian rope trick and that does not bode well. Maybe we are high on energy, listening a little to closely to the voice of intoxication, but it will unfortunately all too soon be replaced by a massive hangover.

The second point (above) is by the way an argument with unmatched know-it-all qualities. If you first explain what a predicament is by using death as an example, you may then easily move on and explain why Peak Gold (which occurred a decade ago) is a good example of a finite-resource predicament. As for the mining of gold, for each year you get less gold for the money (the investments) - from 12 grams of gold per metric ton of ore in 1950 to 3 grams of gold today. Gold is a good example of why the production of all non-renewable resources will always ultimately reach a peak and then begin to fall and/or why we have to run faster for each year to remain on the same spot (mine more ore to get the same amount of gold).

With this groundwork in place, any further objections to any of the arguments above may be rejected with a claim that the person objecting is suffering from denial and is trying to convert a Peak Oil predicament into a problem that may be fairly easily solved (with new technologies - electric vehicles, new energy sources - wind or nuclear power, redressing economic inequalities in the world or in a specific country, by mobilizing unparallelled political will, global agreements or some other miracle cure).

In any case, at around this point I usually stop bringing forward relatively cocksure claims (which if necessary may be backed up), and instead take a more humble stance. This is also where it starts to get really interesting when I further claim that:

5 The future will bring "disruptive" changes. (From Peak Fortune Cookies: "Oil will peak and you will face disruptive changes"). We will face many and big changes in the coming decades, but when haven't we in the previous decades? But the big point here is that the "direction" of these changes will be changed: Peak oil implies Big Changes. But not changes within the framework of the current system, but changes of the framework itself. Obama trump card was "change" ("Change We Can Believe In"). In the election campaign, “change” was a call full of promises, something to hope for and believe in. Unfortunately, the changes that await us will hardly be welcomed by anyone.

I imagine that somewhere during the coming decade (2010-2020), or at the latest in the decade thereafter, we will experience a shift from an expanding system (increasing amount of energy, more natural resources being exploited, increasing global population, more wealth, better welfare, people's expectations about the future being bright and so on) to a system in a state of contraction and shrinking.

We have lived with an expanding system for a few hundred years and all our economic and political structures (as well as our expectations for the future) are therefore adapted to a world of More, Better, Bigger, Faster, More Advanced, Newer, Cheaper and Two-For-The-Price-Of-One. The political challenges of distributing the material surplus of a growing cake is of course a breeze compared to the political challenges of distributing the cutbacks and austerity measures of a shrinking cake. This spring's riots in Greece has given us a foretaste of the problems we are facing. The change from the former (an expanding system) to the latter (a contracting system) will thus be "difficult". As you understand, this is a gross understatement, since (all) our current structures are ill-suited to manage this new reality.

If I allow myself to be a little bit pessimistic, I can not exclude the possibility that all of our current political structures (including a democratic government and perhaps the nation-state itself) will appear to be dysfunctional and break down as they are shown to be unable to cope with the problems we will face in the coming decades. Think of "failed states" such as Somalia, Sudan, Zimbabwe, Congo, Afghanistan etc. These are places where the state has withdrawn from many of its commitments (healthcare, education, police and judiciary, infrastructure, etc.) and where small groups/clans /regions must cope as best they can and not seldom in competition with other groups/clans/regions.

This is by all means a speculative worst-case scenario, but I in any case feel very certain about my claim that we will experience disruptive changes where the direction of the changes and societal "development" (or rather, degradation) will break off from what we and our parents have become accustomed to regard as normal (expansion and better times just around the corner).

To specify exactly what this will mean - what will happen, in what order and on what timescale - is of course an infinitely harder task. Despite the difficulties, it is these issues that interest me the most, rather than issues about production volumes and the exact time and date of peak oil, i.e. issues that Kjell Aleklett’s research group in Uppsala is mainly dealing with. What captures my interest is not "When will peak oil happen?" but rather "What happens next?". And although specific predictions are difficult or impossible to make, broad development lines are at least possible to comment or speculate on.

Some of my earlier texts have dealt with such questions about what might happen when energy becomes more expensive, for example "Energy free of charge", "Transportation free of charge" and “Death of Rationalization”.

I have some semi-developed ideas related to the text above, and I might concretize them in a follow-up to this post.
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Transportation free of charge

.Picture: Ryanair ad, offering to sell us 1 million airline tickts for 79 SEK or less (10 dollars or less) from Stockholm to a variety of European cities. The price corresponds to the cost of two (so-called) meals at McDonalds.


In the previous text I wrote, I suggested that we could - at least from a historical perspective - for all practical purposes regard energy as free or charge in today's society. As a special case of this it thus follows that also transportation is free of charge. That is the topic of this text, but it is written from a completely different perspective compared to the previous text, because the inspiration comes from a book about designing virtual worlds!

In medieval times, it was expensive to transport goods around Europe. Wine was a drink for peasants in France, but if you transported the wine to Scotland, it suddenly became a drink only for wealthy nobles. The cost of transporting wine the - to us - fairly modest distance from France to Scotland was so high that wine after such a trip immediately became a drink for only the very richest of persons. In medieval times, most products were simply not worth transporting for any longer distances and were instead produced and consumed locally. Also moving you own self (to travel) was "expensive" in terms of time, money and effort. It is not a coincidence that the French word for work, "travailler" has the same root as the English word "travel". To travel was time consuming, laborious and expensive.

In a virtual world (such as Second Life or World of Warcraft), there are no logical obstacles that stops you from immediately transporting goods or yourself from one end of the (virtual) world to the other. Actually, there is no physical "world" there in the first place, but rather just a large database that keeps track graphics and points of view, of where everything is and what is behind the next (virtual) hill. In some virtual worlds it is thus possible to immediately teleport yourself (and your possessions) from and to wherever, but most worlds are designed in such a way so as to impose artificial restrictions that make travel a little bit more time-consuming and laborious. Without distances that take (some) time to overcome, the geography of the virtual world would "collapse" and everything would be next-door to everything else. It then becomes rather pointless for the designers of the virtual world to spend time designing roads that will never be traversed and stunning vistas that will never be admired by anyone. There are also other (predominantly negative) implications of absence of (virtual) distances and geography that most desingers choose to avoid or restrict when designing virtual worlds. My point here though is that teleportation is technically feasible and argubly the most "natural" way to move in a virtual world, and that all travel and transportation could be free in such a world (immediate and at no cost).

Let us assume that these two models represent two extremes. At one end we have Europe in medieval times (very expensive transportation and travel) and at the other end we have a creation of imagination, a thought experiment that we call virtual worlds (free transportation and travel). The question is if travel and transportation today is more similar to medieval Europe or to virtual worlds? The answer is obviously that we are a lot closer to virtual worlds where travel and transportation could be completely free but for various game design reasons happens to instead cost (some).

Today we ship goods around the globe in staggering volumes without this increasing the price of the product to any significant degree. Where a factory is located on Earth in the era of globalization has little to do with transportation costs. The actual transportation of a barrel of oil from the Middle East to Europe or the United States contributes only with a price increase of a single dollars per barrel (and last year the price of that barrel fluctuated roughly between 50 and 150 dollars).

Furthermore, Ryaniar (see picture above) will fly me to 35 destinations from Stockholm and the ticket to almost two thirds of these destinations (in a dozen different European countries) costed 10 dollars or less last Christmas (including taxes and charges)! Is it physically possible to push prices lower? Have transportation and travel ever been as cheap as today? The answer to both questions is “no”, simply for the reason that 10 dollars for an airline ticket is so close to free that it makes no difference compared to a price of 5 or 3 dollars. Will transportation and travel continue to be this cheap in days to come? Well, no, of course not.

If we raise our eyes and adopt a historical perspective that extends a few hundred years back in time (before we found oil, before we started using large quantities of coal and before the industrial revolution began) we can again conclude that energy in modern society for all practical purposes has been, and still is free of charge. It thus follows that also transportation and travel is free today (at least from a historical perspective).

In what other society or era has it been possible for the least affluent members of a society to spend an evening babysitting or to rake leaves from someone’s lawn and use (part of) the proceeds to jump on a plane from Stockholm to Prague or Dublin? A one-way trip with Ryanair to these and some other destinations had a price tag of less than 3 dollars (30 SEK) last year before Christmas! Isn’t the world upside down when what I need in order to cook a dinner at home costs more than a flight to Berlin? The 16-year-old girl next door put a note in our mailbox the other day offering her services as a babysitter for an hourly rate of 8.50 dollars during weekends...

It’s not that I begrudge "poor" Swedes the opportunity to travel abroad, it's just that I think the situation is not stable or sustainable in the long run. If oil (and thus fuel and thus transportation) is no longer free, but instead begins to Cost Big Time - say, “only” three or four times more than today - the airline industry would crash and burn in every way possible except literally.

As more than 80% of the energy we use on Earth comes from non-renewable fossil fuels, what will happen when we during this century will have to gradually adapt step by step to making do with the energy that is created and re-created each year with the sun as the source (sun, waves, wind, hydro, biofuels)? The reasoning above and in the previous text give some clues as to the type of changes that lie ahead of us this century, and that will most probably start to reshape our lives already during the next decade...

PS. Should I take the opportunity to travel now while it is still inexpensive or should I refrain?


This text was originally published in Swedish on December 6, 2008.
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Energy free of charge

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A little more than 50 years ago, Lewis Strauss, chairman of the U.S. Atomic Energy Commission, proclaimed that the promise that nuclear power brings is that "It is not too much to expect that our children will enjoy in their homes electrical energy too cheap to meter". The phrase "too cheap to meter" occasionally pops up when an accusing finger points at that phrase as proof that nuclear power has not fulfilled what it promised, or more generally, that new technology is always hyped and that the hopes of techo-optimists are not to be trusted. The idea I explore here is instead that energy for all practical purposes has been and still is free of charge (but that this of course will change radically when peak oil becomes apparent to everyone).

By some calculations based on local Swedish conditions (Flygare and Isacson, 1999), 19 days of manual harvesting - hard physical work 200 years ago - has been replaced by an hour of driving a tractor today. We have in similar ways replaced the vast majority of physical labor by humans or animals - days of toil and sweat moving rocks, logs or merchandise - with the energy contained in one gallon of petrol or diesel. The most common use of petrol today is of course to quickly move hundreds of millions of big heavy metal containers - with (usually) one person inside each - back and forth, back and forth. The average Swedish car weighed more than 1 400 kilos in 2007 according to statistics from the Swedish Institute for Transport and Communications, SIKA.

The term "energy slave" represents the amount of energy needed to replace the work of a manual laborer. The energy content of a gallon of gasoline is roughly equivalent to the force a person can develop during one month of hard physical work. The implication is that in the western world we all can be said to have many energy slaves working for us 24 hours a day in order to maintain our current high-energy lifestyles.

The average American has according to some estimates a three-digit number of energy slaves and even though we Swedes may not have as many slaves, we still play in the same league. Exact estimates of the number of energy slaves varies widely, but the point of using the concept is to convey an understanding in more human terms of the fact that each one of us - unconsciously and perhaps feeling that we are entitled to - make use of large amounts of energy in order to maintain our modern western lifestyles. In ancient Egypt, 95% of the population was directly employed in agriculture and they managed to (only) generate a surplus of energy (food) that was sufficient for feeding the remaining 5% of the population who were slaves and built the pyramids. In "the bad old times" energy was thus Expensive.

The next step here is to show not only that we today use energy in abundance, but also that this energy is very very cheap. I here borrow from Richard Heinberg who argues that it has been sufficient to work for 20 minutes with a statutory minimum wage in the U.S. in order to afford a gallon of gasoline. Twenty minutes of (probably not very physically demanding) work thus gives us access to energy equivalent to up to 200 hours of hard physical work. Exchanging 20 minutes for 200 hours gives us an exchange ratio of a factor of 600 (and far higher if you have a higher salary)!

It is thus impossible to deny that energy is very cheap today. With a longer historical perspective, energy is so incredibly cheap that it can for all practical purposes be regarded as free in our modern society. It might not feel that way when you pay at the pump or when you get the electricity bill, but it is very much so in a longer historical sense. The only reason the electricity bill hurts is because we use so insanely much of that product. A traditional light bulb of 100 Watts uses as much energy in an hour as (or is on par with what) a man performing hard physical labor (an energy slave) can develop during the same amount of time! If electricity was generated by bodily work, we would need an extra man working for us for each lightbulb we wanted to have lit. Low-energy lightbulbs are of course preferable, but we have at this point not even begun to talk about the costs of keeping the fridge, stove, washing machine or our consumer electronics running, or the costs for heating water for a shower.

Perhaps it is possible to push this argument a little bit further and claim that as long as we as a society can afford to maintain our current lifestyle, energy for all practical purposes remains free. When then would energy start to cost? Well, maybe when:

- we as a society must make difficult choices that may seem radical today.
- we discover that the amount of energy (electricity, gasoline, heating) we can purchase with 25% of our disposable income has shrunk considerably, forcing us to make some hard choices.
- most individuals can no longer afford to own/drive cars
- we no longer can afford a summer cottage or to go on vacation (forget abroad)
- we can not afford to heat or cool our McMansions (and forget the pool)

Living conditions is a hidden “energy thief” that many might not think about even though it costs significant amounts of energy to build, heat and maintain our housing. The average Swede has access to 44 m2 (475 ft2) of dwelling per person - an increase of over 60% since the late 70's. Other more authoritave sources such as Statistics Sweden report figures as high as 55 m2 (600 ft2) per person which would mean that we Swedes have doubled our living space per person in as little as 30 years.

According to Jonas Frycklund, an economist at the pro-industry lobby group Confederation of Swedish Enterprise, the average living space per person in the U.S. is 70 m2 (750 ft2) per person. That figure might be correct but as it so happens, Jonas also thinks that we will live in larger houses and consume more in the future and he confidently looks forward to when "the children of our grandchildren will relax in their pools and with good conscience reflect on the fact that that they do not exert any pressure on the environment."

Sweden has the largest number of single households in the world and Stockholm is the top single-household capital of the world. It is obviously more expensive (and more energy consuming) per person to live by yourself rather than to share a household with others. No less than 47% of all households in Sweden are single households and a further 28% consists of two persons. In one part of central Stockholm, Kungsholmen, 80% (!) of all households are single households (I do not know if a single parent qualifies a "single household"). Is it sustainable to have so many refrigerators and stoves and TVs in so many relatively large and sparsely inhabited apartments? Not in a world where energy is no longer free, because in that world we will have to crowd together and share the cost...

Some of the figures presented above can be contested and discussed. There are several factors that you could examine further, for example:

- Exactly how does one define an "energy slave"? Input (energy in terms of food) or output (work you get)? What force can a human being sustainably exert during 8 or 10 or 12 hours of hard physical work?
- How many hours does one month's work consist of? 160 hours (40 hours/week x 4 weeks/month + some holidays) or 320 hours (12 hours/day x 6 days/week)?
- What is the minimum wage (and the average wage) in the US and elsewhere in relation to the price of gasoline (or electricity).

None of this however changes the basic argument proposed above. Energy is from a historical perspective incredibly cheap – for all practical purposes free - and in the long term (beyond the oil peak) practices that we very much take for granted will by necessity be reshaped and altered or altogether disappear. Our challenge is to ensure that “different” does not necessarily and unilaterally mean "worse", but that we can rather find good solutions that can work in a sustainable low-energy society.

After I started to play around with the idea that energy today is free of charge (this text) and that transportation therefore is free or charge too (the following text), I have acquired new conceptual glasses that allow me to see the world in new ways. Media theorist Marshall McLuhan noted that we do not know who discovered water, but we do know that it was not a fish. The point is that it is difficult to see what we swim in, is surrounded by, and take for granted. It is easier to become aware of your own culture and the things taken for granted when you are abroad, when you discover that things work differently there and gain the opportunity to reflect on the differences between here and there.

The same is true for energy and transportation. Our society takes the stable supply of cheap energy for granted to the extent that we are not aware of this fact and have a hard time imagining any alternatives. Only with a provocative claim that "energy is free of charge" - which of course is not true in the literal sense - can we start to think about and recognize the full scope and the implications of what will happen - in all areas - when energy no longer is free, but instead will Cost Big Time.

When I went to IKEA at two p.m. in mid-November last year, I all of a sudden opened my eyes to the fact that there were thousands of lamps along the highway that were already starting to light up. And when I one hour later sat in IKEA's autumn-decorated restaurant, I noticed that I was surrounded by yet more lights in all the windows. It is at times like these that you lean back and ponder. … for example on the fact that the gasoline for driving 25 kilometers back and forth to IKEA only costs a few dollars and that the late lunch at IKEA therefore still was much cheaper than if we would have stayed at home and gone around the corner for a lunch at the neighborhood pub...

Who is today thinking about electricity consumption and the cost of power when we buy a food processor or a DVD player? You and me both, for all practical purposes, treat energy as if it was free of charge. Try to argue against it!


This text was originally published in Swedish on December 2, 2008.


Reference
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Flygare, Iréne and Isacson, Maths (1999). "Jordbruket i välfärdssamhället: 1945-2000" [Agriculture in Welfare Society: 1945-2000]. Stockholm: Natur & Kultur. (Book 5 in the series "History of Swedish Agriculture").
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