The Oil Drum: Peak Oil and The Energy Utilization Chain

It has often been cited how economics does not incorporate or look at physics and biology when it comes to sustainability issues. However it can also be said that physicists and biologists have failed to recognize economics when it comes to studying Peak oil or how to adapt to Peak oil. One of the more interesting dimensions in the discussions of net energy analysis is the Energy Utilization Chain (EUC). Instead of looking only at the net energy from say the oil well to the car wheel (well to wheel), it is important to also look at the energy service itself. You can have a wheel on a car, but you can also take a train or develop other forms of transportation that can use high net energy sources. In economics, this is called substitution and the degree of that substitution is called the elasticity of substitution.
Much more after the jump to The Oil Drum.