Peak Oil is You
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Page added on August 8, 2015
Why Oil Will Never Be Replaced
Summary
- With an ongoing oil glut, it seems that many people believe that the oil industry is at the start of a long term downturn, due to oil eventually being replaced.
- Many believe that technological improvements in drilling, newly discovered oil reserves outpacing consumption, and reduced consumption due to electric vehicles will eventually kill the oil industry.
- This article explains why oil consumption will increase for several decades, and why the price of oil will consistently rise beyond inflation in the long term.
Introduction
Since the collapse of oil prices last summer, it seems that there has been renewed talk about the worst case scenario for the oil industry. Over the last few decades we have had technology improvements leading to enormous oil deposits now being deemed recoverable, additional oil reserves being discovered, and the development of electric vehicles; this has led to the belief that oil will essentially become a useless commodity, and could potentially remain relatively cheap from this point on. Although it can be difficult to predict how many new deposits will be discovered or how technology improvements can improve the utilization rate of the current deposits, one can get a general idea of future oil consumption based on several variables. I am writing this article to refute the argument that oil will eventually be replaced by more efficient technology, and instead offer a discussion of why the rate of oil consumption will continue to grow for several decades. In addition, I will discuss why the price of oil will increase regardless of the remaining world wide oil reserves at the time.
The chart below shows the price of Energy Select Sector (NYSEARCA:XLE), a fund which corresponds to the Energy Select Index. We can see that as a whole, the energy industry has lost about 30% of it’s value since last July.
Why Electronic Cars Won’t Kill The Oil Industry
I’ll start with the most common argument against the replacement of oil: the belief that electronic vehicles will replace the vast majority of the demand for oil.
I think it is important to first get a snapshot of how oil is being consumed, and which of these consumption methods are threatened. Unfortunately, there does not seem to be any global data, so I used the United States data derived from the Energy Information Association (NYSEMKT:EIA). It is important to consider that there would be many variables that may suggest the United States would not the best representative sample of the world, however, this data should at least be somewhat accurate. According the EIA, this is how oil use is broken down in the United States:
| Gasoline | 46% |
| Heating oil/Diesel Fuel | 20% |
| Jet Fuel (Kerosene) | 8% |
| Propane | 7% |
| Natural Gas Liquids/Refinery Liquids | 6% |
| Still Gas | 4% |
| Petrochemical Feed-stocks | 2% |
| Residual/Heavy Fuel Oil | 2% |
| Asphalt and Heavy Road Oil | 2% |
| Lubricants | 1% |
Therefore, we can see that almost half of all fuel is used for gasoline, likely the biggest threat to oil consumption due to electronic vehicles. Despite what many people believe, less than half of oil is used for gasoline; almost a quarter is used for diesel or heating oil, and almost 10% for jet fuel. Therefore, approximately 71% of oil is used for transportation, while only 46% of this is used for personal vehicles (neglecting diesel personal vehicles). I want to take the time to point out that there has been no evidence that we will be having electronic airplanes, cargo freighters, or large scale industrial equipment; therefore jet fuel and heating oil/diesel fuel should still be in demand as the population grows. We have had the technology for nuclear powered boats for decades, it has not proven to be economical or safe based on past experiences; although there has been some research into this, there to date has been no nuclear powered boats used for international trade. There seems to be no evidence of emerging products that would replace home heating oil with respect to cost, as home heating via electricity is currently less efficient than oil heating. So it seems that this chunk of the pie will still be in demand. There seems to be no indication that any of the other mentioned uses for oil would be replaced in the future, as we will continue to use oil for a variety of other purposes such as plastic or asphalt production. Therefore, in the absolute worst case scenario, only 46% of the overall use of oil should be affected by electric vehicles.
Now lets look at this 46% a little bit closer; are all personal vehicles going to become electric? I still think there will be certain classes of vehicles that would be very difficult to become completely electronic, such as larger trucks or recreational vehicles. In addition to this, there will be a significant time lag from when the technology becomes widely available to when it is popular. Then, we have to consider that people are not just going stop driving gas vehicles altogether, it would be a gradual phase-out that would occur over a couple of decades, to consider the average lifespan of a vehicle. Then we have the huge amount of the population that would likely still prefer to drive gas vehicles, as well as the effect of the developing world; countries with less money are likely to continue driving and fixing gas vehicles for several decades due to the lower cost.
Based on what I’ve been reading, it seems that almost all major automobile manufacturers are planning on releasing electric vehicles in the next decade. Lets take an extremely pessimistic view and assume that by 2030, the majority of vehicles sold become electric, and by 2040, gas cars are no longer mass produced. Even in this almost impossible scenario, as there will likely always be a market for people that “prefer” gas cars, it would still be around 2050 to 2060 before gas vehicles were completely off the road. With these assumptions in mind, the global use of automobile gasoline would likely peak until the shift towards electronic cars outpaced overall use of automobiles (which would be based on population and global economic situations); therefore in this almost impossible scenario, our gasoline consumption would increase as it has in the past, for at least a couple of more decades.
One important consideration is that people that predict that oil will become replaced essentially fall victim to their own argument; the shift towards electronic vehicles would only occur if it was more economical, which would assume that oil would have to become more expensive. If the market shift towards electronic vehicles was so significant, it would lead to a lower price of oil, which in itself would retard the growth of the electronic vehicle market. In order for electronic vehicles to beat out oil-powered vehicles in market share, there would need to be a long term cost advantage of electricity over oil. One last point that must be considered in this scenario, is that if the shift towards electronic vehicles was significant enough, the price of electricity would logically increase as well, and there would be enormous pressure to bring enough electricity to the grids.
Furthermore, when you consider that the US Energy Information Administration believes that by 2040 gasoline and diesel vehicles will constitute 95% of the market worldwide, it seems that the almost impossible scenario I outlined would not happen. Even if it did happen, it would take several decades to have any significant effect, and massive amounts of oil would be depleted by then. I do believe that the EIA prediction is somewhat overly optimistic for the oil industry, and it seems feasible that electric vehicles would be more than 5%; this, however, is just my personal speculation, based on the general interest of electric vehicles. I also live in a notoriously “left wing” city, where we are already seeing a lot of electric vehicles on the road.
The EIA proposes that personal vehicle oil consumption will only slightly increase from 2010 to 2040, while commercial transportation (shipping, rail, aircraft, commercial trucks, etc.) is expected to double. They posit that this is due to increased efficiency and use of electric vehicles being offset by population growth and increased demand from developing countries, most notably China. Overall, they predict that transportation use of oil would increase 40% by 2040.
One last consideration is that many automobile manufacturers have shifted towards increasing fuel efficiency, rather than replacing the combustion engine. I think that this has to be considered as a negative variable for oil consumption, as even if combustion engines were 95% of the cars by 2040, the overall consumption per mile may be significantly lower. This is a very difficult thing to predict as it would depend on future technology, and future buying habits; will people continue trending towards buying larger vehicles, or will the trend go the opposite way? The EIA predicts that the average MPG will drop from 45 mpg in 2010 to 25 mpg in 2040; this would roughly offset their prediction of overall vehicle use doubling by 2040, of which 40% is attributed to growth in China. One must keep in mind that the EIA is making a very bold prediction that the general market will be moving towards greater fuel efficiency, rather than electric vehicles; however, even if this prediction was wrong, the demand for oil would still be consistent.
Cheap Oil Will Be Gone Soon
Many would argue that the “cheap oil” was drilled a while ago, but this seems to be subjective. As a whole, however, there has been a general trend that the cost of oil production per barrel has steadily risen beyond inflation due to the natural effect of a free market economy; the more easily accessible oil has been drilled first, leaving behind increasingly difficult to access reserves. It is important to consider that most of the countries that have large reserves of easily accessible oil, or the Middle-East reserves, are pumping at an incredible pace; while the extremely large and expensive deposits of oil in Canada or Venezuela, are being pumped at much lower rates as they are not very economical at today’s prices. Although technological advancements can delay some of this, it seems that this trend will inevitably continue with time. Therefore, because it would take so long for the world’s dependence on oil to decrease significantly, the shift towards electric vehicles would not likely occur until a significant chunk of the current petroleum reserves are depleted. Despite the seemingly huge global reserves of oil, an enormous percentage of this is very expensive to drill, and this will constitute almost all of the remaining oil by the time the shift occurs towards electric vehicles.
Why “Future Discoveries” Won’t Lower The Price of Oil
The next argument against oil, seems to be the wide-held belief that we will continue to discover more reserves of oil, and this would keep the price of oil low as the fear of hitting peak oil would be routinely delayed. Looking at the huge increase in global oil reserves over the last twenty years certainly adds a lot of strength to this argument, especially in North America as technology has turned dozens of billions of barrels into recoverable oil.
What is the problem with this argument? It is absolutely true that the global oil reserves will continue to increase over the next few years, and it will likely continue to increase beyond the amount of oil that is consumed annually. A better way to understand this situation is to consider that almost all of the new oil that will be discovered in the future, will be “expensive oil”; furthermore, any reserves that would be deemed recoverable due to technology improvements would almost be guaranteed to be more expensive, as the oil is considered to be non-recoverable due to the difficulty of obtaining the oil. So instead of focusing on the global oil production, consumption, and reserves several decades from now, instead look at the average cost of production several decades from now. Even if oil consumption fell to half of its current levels, the price of oil would still logically have to increase if the average cost of production was significantly higher than today; this price increase would logically go up due to the expense costs, regardless of the demand for the product.
The classic catastrophizing belief around oil has been that the oil reserves would almost run out, sending the price of oil to enormous levels, and inducing a worldwide economic collapse; therefore the belief was that declining reserves would ultimately lead to an extremely high price for oil. Therefore, the retort to this argument has been that the ever increasing oil reserves would not allow that scenario to happen. Instead, we are going to see the price of oil gradually increase in the long term as the price of obtaining the oil will increase, regardless of the demand.
Population Growth
Another obvious consideration that seems to be neglected, is that the global population is still growing at a rapid rate. We currently have a worldwide population of 7.18 billion people; By 2050, the United Nations Department of Economic and Social Affairs predicts that the global population will increase to over 9.5 billion people; this generally agrees with other estimates as well. Therefore, this represents an approximately 25% increase in population. Even if the oil consumption per person decreases significantly, the overall consumption would be largely offset by the continual growth in population. Also, keep in mind that over half of oil consumption is not used for personal vehicles, and this would likely continue to grow regardless of technology advancements. Also, the continual trend towards international trade would proportionately increase the role of commercial transportation.
Developing Economies
As of 2014, the United States had almost 5% of the world’s population, and almost 25% of the personal vehicles. China, the world’s fastest grower in automobile use, currently has less than 7% of the world’s vehicles, and is expected to more than quadruple this number in the next 30 years. This is part of the reason why the OECD International Transport Forum suggested that by 2050, there would be 2.5 billion cars on the road; to put this in perspective, the global number of cars surpassed 1 billion in 2010, and have already grown to 1.2 billion since then. As more of the world starts to mirror the spending habits of the United States, this will logically increase the number of cars. Furthermore, this adds extra importance on the economic feasibility of electric cars, as price would likely be the most significant factor in developing economies.
Buying Opportunity
I believe that I have outlined a general argument as to why oil will never be replaced as a commodity, as the only significant threat seems to be electric vehicles, which will not likely have an enormous impact in our lifetimes. Why does this create a buying opportunity? Because this opinion seems to be in the small minority right now, as many speculate about the long term viability of the oil industry. It is unlikely the oil will increase significantly in the next few years due to the global oil glut, however, as more capital expenditures are reduced and mega projects are canceled, it is only a matter of time before this lack of long term production results in the pendulum swinging the other way, and oil-producers would be unable to meet global demand. This needs to occur for much longer, and more companies need to become insolvent in order for this trend to continue enough to shift the momentum. I believe a significant increase in the price of oil would occur afterwards, which would likely occur between 2020 and 2025; I will be explaining how I came to this conclusion in a future article.
I believe that the best way to profit for a long term oil investor, is to invest in the Canadian oil sands industry, as they are home to many projects with lifespans of several decades, and contain vast reserves with a higher cost of production; this makes Canadian energy companies seem like a poor investment right now, when it is in fact a fantastic buying opportunity. I believe that the safest way to invest in the Canadian oil industry for the long term, is to invest in one of the large diversified companies such as Suncor Energy (NYSE:SU), Imperial Oil (NYSEMKT:IMO), or Canadian Natural Resources Limited (NYSE:CNQ); this is because these companies are generally profitable in a downturn due to their downstream revenues, while also owning several projects with billions of barrels of reserves. So far, it seems that Suncor offers the best long term return due to their large cash and oil reserves, and continual positive earnings.
As I believe oil will likely continue in the $40-$60 range for the next few years, now presents a good buying opportunity for the long term or medium term investor; one could load up on oil companies waiting for an eventual large rebound, or one could play the swing trade in oil by buying in the $40’s and selling in the $60’s. Either way, oil has head into the $40’s for the third time in the last few months; despite what the media says, the world is NOT ending, and it will go back up shortly. Take advantage of the irrational beliefs of others, by loading up on oil stocks over the next few months and years, especially right now as oil approaches new lows.
43 Comments on "Why Oil Will Never Be Replaced"
Plantagenet on Sat, 8th Aug 2015 10:31 am
“Seeking Alpha” predicts that the oil glut may continue for another two years. Possibly—is hard to predict the exact timing of the end to the oil glut. But the drop in rig counts is eventually going to translate into a drop in oil production, and an end to the oil glut.
penury on Sat, 8th Aug 2015 10:54 am
I agree that oil will remain “cheap” for the next few years. However, one persons cheap is an other persons too dear to buy. In an economy “worldwide” of cratering sales deflation is rampant. The ability of people to buy the product is falling faster than prices can be cut. A perfect feed back loop is being established. A cannot buy, B can no longer sell, B fires A and the cycle continues. There are no sources ofr demand left able to reignite the boom years prior to 2006.
Mike989 on Sat, 8th Aug 2015 11:06 am
Finance. An industry that’s Dead in 10 Years, is Dead Today.
No long term buyers.
Coal going bankrupt globally.
Natural Gas/Fracking will be next.
Then Gas.
That’s reality.
Either you get out of carbon now, or you ride the wave to bankruptcy.
Repubs are welcome to do that.
Davy on Sat, 8th Aug 2015 11:23 am
Mike, you forgot to add AltE to your list or better yet since this is multiple choice (d) all of the above. You green corns are so delusional. You have some kind of exceptional view of AltE and EV’s like they are decoupled from the regular economy. The regular economy produces AltE Mike not the other way around.
Boat on Sat, 8th Aug 2015 11:53 am
So all consumers of oil products that save $1.50 per gallon can’t afford to pass on their savings? Fresh veggies, canned goods, meat etc are all cheaper in stores. The simple message is, huge windfall profits by a few are now being passed out to the many but awesome to to the consumer.
Davy on Sat, 8th Aug 2015 12:13 pm
This is for the boat and his happy face comment:
Stephen Schork, appeared on BBG’s Pimm Fox yesterday to explain not only what the immediate future holds for both oil and gasoline prices, but why, when one actually gets cause and effect right, “this drop in oil prices, this drop industrial metal prices, this is not good. It’s a canary in the coal mine that something is not right in the global economy, and that is a concern for us all.”
And this is the big concern because we keep on thinking that lower energy prices are somehow good for the economy. That can’t be, because energy prices or commodity prices in general don’t drive economic growth. Economic growth drives commodity prices.
Stephen Schork: The Commodity Crash Is “A Canary In The Coal Mine For The Global Economy”
http://www.zerohedge.com/news/2015-08-08/stephen-schork-commodity-crash-canary-coal-mine-global-economy
Boat, some of what you say is undoubtedly true for some people but for the economy as a whole it is not happening like you corns have been preaching. Why can’t you acknowledge that Boat?
marmico on Sat, 8th Aug 2015 12:37 pm
Don’t forget the refinery margins. They are picking up an extra $0.25 per gallon of gasoline relative to recent crack spreads.
http://theamericanenergynews.com/energy-news/american-refineries-enjoying-a-record-run-in-2015
shortonoil on Sat, 8th Aug 2015 1:39 pm
“And this is the big concern because we keep on thinking that lower energy prices are somehow good for the economy.”
There seems to be a phenomena that if someone is told something enough times that they will believe it. The media, and about everyone else has been pounding the “cheap energy” scenario. Someone should ask “how cheap, and “cheap for whom”?
For the end consumer, who has to pay the entire energy bill, oil at least, is not cheap. On a BTU bases the end consumer is paying 18% more today for a BTU from crude than they did in 1970. That is based on nominal dollars. In 1970 a barrel of oil was $3.18 and the end consumer received 126,035 BTU from a gallon of crude. In 2015, at today’s price, a barrel of oil is $43.75 and the end consumer gets 63,345 BTU from a gallon of crude.
A barrel of oil may be cheaper than it was a year or so ago, but it is still not cheap. Cheaper is not the same thing as cheap. If the media can not tell the difference between cheaper and cheap, what can they tell the difference about? Cheaper oil is not going to save the day because it is definitely not cheap!
http://www.thehillsgroup.org/
Truth Has A. Liberal Bias on Sat, 8th Aug 2015 2:01 pm
Another case of someone who didn’t see the drop in price coming now telling us how long it’s gonna be here.
Energydebt on Sat, 8th Aug 2015 2:21 pm
What an utter lie: “reduced consumption due to electric vehicles”…
Then something opposite: “Why Electronic Cars Won’t Kill The Oil Industry”
jjhman on Sat, 8th Aug 2015 7:52 pm
Short said:”On a BTU bases the end consumer is paying 18% more today for a BTU from crude than they did in 1970…. In 1970 a barrel of oil was $3.18 and the end consumer received 126,035 BTU from a gallon of crude. In 2015… oil is $43.75 and the end consumer gets 63,345 BTU from a gallon of crude.”
But in 1970 the VW I was driving got about 25 MPG in driving around town. If I had been driving a Mustang I would have been getting about 14 MPG. Today my wife’s Toyota gets about 27 with a big V6 and my Mini gets over 32. So it’s not quite as bad as you suggest.
Makati1 on Sat, 8th Aug 2015 9:34 pm
Sales pitch to keep the suckers on the line…lol.
“…now presents a good buying opportunity for the long term or medium term investor…”
All of the rest is pure bull shit.
Kenz300 on Sun, 9th Aug 2015 4:40 am
Electric cars are the future……..
No oil changes, no tune ups, no replacing exhaust systems, and no gasoline……..
Drive buy the gas station and wave…….
Dredd on Sun, 9th Aug 2015 6:24 am
It need not be replaced.
It needs to be repealed.
The global trade via sea ports is endangered (The Gravity of Sea Level Change).
So, leave it in the ground already.
Mike989 on Sun, 9th Aug 2015 9:53 am
Again, when “energy” only means carbon-energy, you’re not seeing the big picture.
Solar companies are booking GIGAWATT size projects.
What you’re seeing is a sector of the economy now Simply Ignoring Carbon. That’s going to kill demand, for carbon, demand for Solar is STRONG.
The pollution industry is going to look like it’s in a slump, which in a previous Decade gave you proof of an economic slump.
That Correlation is now BROKEN.
Davy on Sun, 9th Aug 2015 10:18 am
Mike is in his usual green delusions of rapture. Mike, tell me solar that has no carbon component and I will tell you about the carbonless diesel I have here on the farm.
Mike we are not stupid here. We see through your green wash. I am green and a tree hugger but I believe in reality not fantasy. I have solar here on the farm. I read constantly about AltE. I am a believer in it but for real reasons not false promises.
In this time in our history one of the greatest task ahead of us is the pursuit of the truth through honesty and humility. What we face is epic and dangerous. We can no longer afford NASA Mars travel nonsense and Hollywood happy endings with modern life. This is about a rebalance through a bottleneck period. Rational honest soul searching is needed. Tough choices will need to be made with little margin of error.
onlooker on Sun, 9th Aug 2015 10:28 am
The problem is not us leaving oil, it is oil leaving us.
Outcast_Searcher on Sun, 9th Aug 2015 10:41 am
Mike, how do you propose we go from the 2% electricity at a utility scale now in the US to enough to get us 100% off of fossil fuel dependence for electricity?
We have rising energy demand globally as far as the eye can see. Solar is EXPENSIVE when considering installation and maintenance, even if the panels were free (they’re not) and even if the panels didn’t require lots of hydrocarbons during their life cycle.
Now, even if you somehow got there without destroying the economy (I don’t think you can) — you have a MUCH bigger problem. HOW do you replace the TRANSPORT fossil fuels? You can’t run electric cars on moonbeams – they take LOTS of energy.
Though green energy will grow, we will have massive fossil fuel consumption for many decades. You’re simply ignoring the problem.
If in doubt, read “The Conundrum”, which points out the global carbon footprint will inevitably climb for decades due to human nature and the consumption of carbon nearly ALL human activity takes — including breeding more humans.
Outcast_Searcher on Sun, 9th Aug 2015 10:44 am
Mike and Ken, it’s not a technology problem, it’s a human nature problem. New technology makes things cheaper — so more stuff is consumed, which increases the global carbon footprint.
If we don’t fundamentally change human nature, no amount of techtopian “solutions” will help over time.
Good luck fundamentally changing human nature in time to solve the AGW problem as the global human population continues to grow.
penury on Sun, 9th Aug 2015 11:06 am
OS I would like to agree with you ” it’s not a technology problem, it’s a human nature problem.” When you talk energy everyone wants to go to wind or solar. Wonderful, little problem, what would be the time frame, and the cost of supplying solar and.or wind power to say the State of Georgia if you started tomorrow? All I get when I ask the proponents is gobbledy gook, try it its fun.
Mike989 on Sun, 9th Aug 2015 11:06 am
Davy, sure, this year solar has a carbon component in it’s production and distribution. That will drop year after year.
What you’re seeing is say 10%-20% in the financial community see the geometric growth of solar and wind, caused by rapid price drops, that are projected to continue.
The battery storage revolution alone will cancel 50% of coal facilities, as with demand leveling you only need 1 plant and battery backup, where you’d have needed 2 plants to handle peak.
As battery backup is vastly faster at switching speeds than a gas plant, you don’t need gas plants.
What’s left is transportation.
I’d bet only on companies that are making serious investment today: Tesla, Nissan and GM.
The others are going to get caught in the wave of geometric change.
That’s the problem with geometric change, would you have imagined 40 coal company bankruptcies 2 years ago?
What will the world look like in 2018?
Market disruption is not predictable if you don’t watch for it.
Mike989 on Sun, 9th Aug 2015 11:08 am
Lesson, it only takes 20% of global investors that see the future, to affect markets today.
Mike989 on Sun, 9th Aug 2015 11:14 am
The state of Georgia is small potatoes, or is that peanuts.
New Zealand is doing it in three years.
http://www.greentechmedia.com/articles/read/wind-and-geothermal-will-allow-new-zealand-to-completely-phase-out-coal
And think of the benefits.
1) No Fresh Water Diverted to clean coal for processing.
2) No coal air pollution problems.
3) No mercury, arsenic and uranium in your water supply.
4) You import coal into Georgia, but you’d replace that will Local Jobs building Local Power.
5) Lower rates of autism in your kids from the mercury drop in your water and fish. In other words vast improvement in health to the state population.
6) No coal ash spills into your water.
Mike989 on Sun, 9th Aug 2015 11:59 am
“I want to take the time to point out that there has been no evidence that we will be having electronic airplanes, cargo freighters, or large scale industrial equipment; ”
– Actually, this statement isn’t true.
– We see research into electric versions, and hybrid versions are being produced. The economics of switching to a hybrid solution today, for any vehicle run 8 hours a day or more are very large, lower fuel expense and less maintenance typically.
– The switch to pure battery/electric versions has a bigger payback to the investor.
Seeking Alpha is a short term 3 month horizon source if information, and therefore incompetent.
Davy on Sun, 9th Aug 2015 12:04 pm
Mike you are a lost cause. At least you are promoting a valuable component of our future energy needs. We need more AltE in those areas where they have the greatest EROI or bang for the buck. AltE is a valuable niche energy component to the overall energy complex but it will not substitute for fossil fuels.
I am with Pen & Outcast most of the issues we are dealing with are human nature and human attitudes. I see little chance of changing that until a significant crisis. In crisis comes change.
Some changes that are needed is seasonality, variability, and slow speed (local). This is of course not comparable with the status quo but it will be the future if we are lucky enough to have a future. Our rebalance is near with population and consumption. We will see a drop by an order of magnitude whether we like it or not. Bottleneck economics will not be pretty.
apneaman on Sun, 9th Aug 2015 12:06 pm
Yes there are some benefits mike, but there are also major externalities techno-utopians avoid like the plague. Like what is the waste stream going to look like if it’s scaled up too? How much habitat has to geet torn up for these green dreams? How many more dystopian lakes and towns will it create?
The dystopian lake filled by the world’s tech lust
… “Hidden in an unknown corner of Inner Mongolia is a toxic, nightmarish lake created by our thirst for smartphones, consumer gadgets and green tech, discovers Tim Maughan.”
…
http://www.bbc.com/future/story/20150402-the-worst-place-on-earth
…
Salmon run threatened by ‘unprecedented’ British Columbia mining spill Contaminants released from mine tailings pond entered local waterways, lakes, prompting water ban
http://america.aljazeera.com/articles/2014/8/7/bc-mine-tailings.html
…
Million gallon wastewater spill shuts down Colorado river
http://america.aljazeera.com/articles/2015/8/7/wastewater-spill-shuts-down-colorado-river.html
apneaman on Sun, 9th Aug 2015 12:11 pm
Mike989 if your really interested in solar batteries then why not take a good long look at the biggest one of all – the one you live on. Pay special attention to what ape industrialization has done to discharge it. All your green dreams are more of the same.
Humans face extinction if plant destruction continues: ‘Laws of thermodynamics have no mercy’
…
http://www.ibtimes.co.uk/humans-face-extinction-if-plant-destruction-continues-laws-thermodynamics-have-no-mercy-1511026?utm_content=buffer99158&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer
…
Human domination of the biosphere: Rapid discharge of the earth-space battery foretells the future of humankind
…
https://collapseofindustrialcivilization.files.wordpress.com/2015/07/pnas-2015-schramski-1508353112.pdf
Davy on Sun, 9th Aug 2015 12:13 pm
Come on Mike, you can crow about grid power some but you are pissing in the wind discussing AltE transport. AltE transport has a very low possibility of becoming a significant source of transport power. This is especially true with aircraft, heavy equipment, freight transport, and very large ocean vessels. You may get some penetration in the passenger transport sector but even there EV’s will likely never scale up significantly because of cost and time left to scale up.
Boat on Sun, 9th Aug 2015 12:37 pm
Google Solar City and look at the way to finance Solar. Founded in 2006 now has grown to 35% of the US market. Just the beginning folks
Boat on Sun, 9th Aug 2015 12:56 pm
Davey,
The price of oil has been inflated for several years more from market forces and geopolitical reasons. Appears to me a normal new range for a barrel of oil is in the $65 range. Oil under $50 is a a market overreaction.
The savings consumers get now will go back in the consumer market and get a better value for their dollar.
The last few years the over inflated price of oil kickstarted fracking but as we have learned that even oil as low as $50 still leaves 1/3 of the rigs drilling. I have read some of these wells break even at $31. Those particular wells are still making a lot of money. So they keep drilling. Just think how much money they made when oil was $100 a barrel. So much for the ponzi scheme/oil didn’t make any money.
ghung on Sun, 9th Aug 2015 1:05 pm
Woe be unto me to point out that you guys keep having the same misguided argument. The question isn’t whether or not fossil fuels will be replaced. The real questions are; When? With what? To what degree, at what point in the collapse of industrial civilization?
We and our children will all be making other arrangements, most of which won’t measure up to your current expectations. Best be reviewing those expectations and deciding which are quickly becoming obsolete.
apneaman on Sun, 9th Aug 2015 1:07 pm
What’s happening in the oil market right now is ‘unprecedented’
Read more: http://www.businessinsider.com/the-new-structure-of-the-oil-market-2015-8#ixzz3iLHzmcLW
apneaman on Sun, 9th Aug 2015 1:09 pm
Don’t worry Elon, Uncle Sam still has a little more milk in the titty before it runs dry…………………………………………………………………….
Tesla Loses More Than $4,000 On Every Car Sold
http://www.zerohedge.com/news/2015-08-09/tesla-loses-more-4000-every-car-sold
ghung on Sun, 9th Aug 2015 1:14 pm
Sure, Boat. Google Solar City, then google “Solar City Reviews”. You can start here:
http://www.consumeraffairs.com/solar-energy/solarcity.html
Western culture, media, politics, and corporate propaganda; all designed and remarkably adept at keeping “WE, The Children sucking on the BAU tit. That’s what Solar City’s 20 year contract is all about. Maybe they’ll throw in a 72 month lease on a Tesla if you whine enough.
MrNoItAll on Sun, 9th Aug 2015 1:25 pm
“Google Solar City and look at the way to finance Solar”
Then Google “solar city reviews” and read about how terrible the “deal” actually is, bordering on a scam operation.
Last week I was in Home Depot and was approached by a Solar City guy standing in his booth. He gave me the sales pitch and I said sure, sounds great, send one of your sales guys out.
The guy who came out was a nice guy, but obviously not very bright. He told me things that directly contradicted what the sales guy at Home Depot told me. For example, the guy at Home Depot told me that Solar City makes money by selling back all of the excess electricity generated by the solar setup to the local power company. The sales guy told me that I get to sell all of that excess electricity to the power company. When I pointed out the discrepancy, he admitted he didn’t know who got to sell the excess electricity.
When the solar panels get old and worn out, they don’t replace them. They also use the cheapest possible solar panels, according to a couple of reviews I read.
One of our friends got the Solar City setup and now regret it severely, for multiple reasons, most of all because they aren’t saving a dime.
One final thing. The Solar City salesman that came to my home kept telling me that I get an Oregon State tax credit of $3000 per year for four years. Then, at the end of his sales pitch, he told me there is one catch. And that is, I have to pay Solar City half of that tax credit — not when I get the tax credit, but monthly! So, instead of no upfront cost and just paying for my monthly electricity usage that the Home Depot sales guy promised, I have to pay $75 per month plus monthly electricity usage.
Solar City is a scam operation. Don’t fall for it. That’s my opinion and advice.
Guys like Boat think Solar City is the wave of the future, along with Tesla and other government funded technological fantasies. Their critical thinking and fact gathering skills prevent them from seeing the real picture, rendering them and millions like them “suckers” for these “great deals”. And keeps them from understanding how dire the straights are that we find ourselves in.
It’s okay, Boat. Not everybody gets born with it.
apneaman on Sun, 9th Aug 2015 1:38 pm
Lol
apneaman on Sun, 9th Aug 2015 2:05 pm
Solar City – The Enron of alt energy.
apneaman on Sun, 9th Aug 2015 2:25 pm
Oil will never be replaced, but industrial civilization will and maybe the apes too. Here’s your daily DOOM.
Food System Shock
The insurance impacts
of acute disruption to
global food supply
Emerging Risk Report – 2015
Innovation Series
http://www.lloyds.com/~/media/files/news%20and%20insight/risk%20insight/2015/food%20system%20shock/food%20system%20shock_june%202015.pdf
Boats high and dry as Central Europe fights drought
http://www.scotsman.com/news/environment/boats-high-and-dry-as-central-europe-fights-drought-1-3852796
Water district’s wells across Washington running dry
http://www.kirotv.com/news/news/water-districts-wells-across-washington-running-dr/nnF26/
California drought: River that runs through downtown San Jose goes dry; fish and wildlife suffer
http://www.mercurynews.com/drought/ci_28607817/california-drought-river-that-runs-through-downtown-san
Conserving soil: precious, finite and under threat
http://www.theecologist.org/blogs_and_comments/Blogs/2961577/conserving_soil_precious_finite_and_under_threat.html
What a scorcher! Typhoon Soudelor triggers Hong Kong’s hottest day in 130 years as pollution levels soar
Many elderly people struggle to cope as city records hottest temperatures in 130 years as three people were sent to hospital with suspected heatstroke and more than 1,500 call for emergency help
http://www.scmp.com/weather/hong-kong/article/1847760/hong-kong-bakes-typhoon-soudelor-triggers-record-highs-start
Heat Continues to Roast West, Fueling Drought, Blazes
http://www.climatecentral.org/news/heat-roasting-west-fueling-drought-blazes-19318
I’ll leave y’all with that to ponder while I go off to march in the first ever hetero sexual pride parade. Actually, I’m just going for a walk, but I can still dream damn it!
Makati1 on Sun, 9th Aug 2015 8:00 pm
Back and forth. The proponents and the deniers.
Reality: Unless the first world is willing to give up 90%+ of their energy usage, it ain’t going to happen.
Anyway, the financial/economic system is going to crash and end ALL of the ‘alt-energy’ plans except muscle power. When the dust settles, there will be no ‘middle class’ anywhere. And maybe not much of a master class either.
No matter what you want to believe, electric is never going to power a 787 jetliner with 400+ people and luggage anywhere. Electric vehicles will not replace cars in any significant numbers.
Electric will definitely never power the mega machines that mine and haul the minerals everything needs to exist.
If you want a look at the future, study the 18th century before coal. That is, IF we are lucky.
So, argue all you want. The future is already set and it ain’t even close to BAU.
shortonoil on Sun, 9th Aug 2015 8:10 pm
Burning fossil fuels produces enough heat to raise the temperature of 179 cubic miles of water 1° F per day. That is equivalent to 1.54 Lake Eries per day. Unless someone can figure out how to speed up of the flow of that heat into space for an entire planet, we won’t be using FFs much longer.
davey thompsony on Sun, 9th Aug 2015 8:24 pm
I hear ya Makatione “So, argue all you want. The future is already set and it ain’t even close to BAU.” AND lets not forget the nukes 440 some odd FUKIES waiting to happen.
Makati1 on Mon, 10th Aug 2015 9:34 pm
davey T, yep they are just waiting to go wild.
Ed on Tue, 11th Aug 2015 5:54 am
There is no alternative to fossil energy. When it’s gone, it’s gone. No electric cars, renewables won’t renew themselves when get to end of their lifespan, nuclear plants won’t be decommissioned etc. The carrying capacity of the planet will plummet as the productivity of the land to produce food plummets. We will be back to a wood burning society within 100 years although there may not be any trees left to burn as 9 billion people compete to stay alive.
In the short term any commodity which will become scarcer is worth owning. So energy and arable land is worth buying.