Sunday, June 26, 2016

Brexit and the energy equation

The fretting in the financial markets after Great Britain's voters narrowly decided to leave the European Union (EU), a move dubbed Brexit, was less about immediate effects--there aren't any since it would take Britain up to two years to withdraw--and more about a foreboding that other countries will want out, too.

In addition, some think it likely that Scottish independence will once again be on the agenda. Scots were heavily in favor of remaining in the EU.

Centrifugal political forces are bad for business since they spell uncertainty and ultimately disruption if they come to fruition as they did in Britain regarding the EU. And, Britain, of course, isn't the only country in Europe facing breakaway movements. The people of Spain's Catalonia region have for some time sought a referendum on independence from Spain. Only last year Catalan separatists won a majority in the regional government. The movement cites cultural and linguistic reasons for independent statehood, reasons that could be asserted by many groups across Europe and lead to more instability.

The larger question is why there is building discontent with global economic and political integration not only in Europe, but also in the United States as evidenced by the candidacies of Donald Trump and Bernie Sanders.

The slim defeat for pro-EU forces has been explained as a vote against EU immigration and business regulation policies and against the loss of national sovereignty. But there is also a feeling afoot that the move toward greater integration through the EU and through global and regional trade agreements is designed primarily to enrich global financial elites--all the while subjecting middle- and lower-class wage earners to stagnant and even falling incomes as they compete against cheap labor in developing countries.

In the conversation about the rising revulsion against further integration, one factor is not being discussed: energy. With oil, natural gas and coal, the world's primary energy sources, all far below their high prices of the last decade, all would seem well on the energy front.

Britain, of course, had been reaping the benefits of oil and natural gas deposits in its sector of the North Sea since the 1970s. However, after 2005 the country ceased to be a net exporter of crude oil and natural gas liquids. Imports of natural gas have risen steeply with 2014 imports reaching 19 times what they were in 2000. Both these trends point to the decline of the North Sea fields and Britain's re-entry into the league of oil and gas importers, a sudden reversal of a previous long-term trend and a net negative for the British economy.

As you'll see below, this trend combined with the effects of high energy prices on productivity growth had a negative effect on the incomes of middle- and lower-class voters who simultaneously paid a higher proportion of their incomes for increased energy bills. This double whammy has likely contributed to discontent among such voters who were looking for a way to express their frustration and found it in the Brexit vote.

Returning to the trends mentioned above, the year 2005 turned out not only to be an inflection point for the North Sea fields, but also for the worldwide oil markets. Prices rose inexorably and spiked in 2008 to their highest ever. After prices dipped to around $35 per barrel in the wake of the financial crash that followed, they rose sharply again regaining $100 by early 2011 and hovered around record average daily prices for more than three and a half years. The high prices were related to rising demand from Asia, but also to a dramatic slowdown in the growth of oil production worldwide.

If the cause of our current economic difficulties was, in part, high oil prices which slowed the world economy, then an energy connection comes into view. Current low oil prices become a symptom of economic weakness rather than merely a reflection of excess supply. (Much of the world outside of North America also experienced high natural gas prices during this period in the form of high landed costs for liquefied natural gas in Japan and Europe, far higher than the U.S. pipeline price during this period.)

Moreover, high energy prices in general can be linked to slower productivity growth. And, we have seen global productivity growth far below the expected trend since 2005, a year that was as noted an inflection point for oil prices. Now, here's the important part: Productivity growth is the basis for rising wages. With declining productivity growth employers are less likely to raise wages as those raises would eat into profitability.

There are other reasons why wage earners may not be receiving wage increases, but lack of productivity growth is an important one.

So, here's what all this had to do with the Brexit vote: Stagnant or declining living standards breed discontent among a populace used to rising standards. Pro free trade and economic integration forces argue that such integration into larger trading federations leads to greater prosperity. When the prosperity disappeared as it did in Ireland, Spain and Greece, significant political movements arose in the latter two (Podemos in Spain and Syriza in Greece) which question further integration and suggest at least substantial alteration of the terms of EU membership. The effect on British wage earners was more subtle, but found its expression in the Brexit vote.

Likewise, real American median wages have been generally slumping since 2007. The long-awaited recovery in wage growth has yet to appear in the United States even as a boom in oil and natural gas related to extraction from shale deposits boosted incomes in states where the boom occurred.

As in Europe, American voters have been looking for the reason for their declining prospects, and two candidates for president this year suggested a reason that makes sense to those voters: Global trade agreements have depressed American wages. Donald Trump said he would "renegotiate" the North American Free Trade Agreement (NAFTA). Bernie Sanders outright opposed NAFTA in 1993 while a congressman and continues to oppose agreements he believes punish domestic labor.

While supposedly unfair trade and financial agreements may be a cause for the decline of middle- and lower-class fortunes, they cannot be the sole cause. That's because wage stagnation began long before NAFTA and long before the introduction of the Euro.

It's instructive to note that in the United States median hourly wages leveled off in 1973, the year of the Arab Oil Embargo. Energy costs in the United States rose dramatically after that though they returned to lower levels in the 1980s and 1990s. Still, the country was increasingly dependent on foreign oil and sent more and more of its income abroad during this period to pay for that oil. During the recently expired oil and natural gas boom in the United States, high prices enriched those involved while transferring wealth from those who weren't. The effect on overall wages seems to have been slightly negative.

None of this definitively proves that stagnant wages are caused by high energy prices, increasing energy imports or skewed trade agreements. But there is strong evidence that all three are implicated. Not surprisingly, energy is the theme that is being neglected in this discussion because energy is currently in a cyclical price trough, one that may very well have resulted from the dampening effect previously high prices had on economic and productivity growth.

Such effects are hard to pin down. And, the mythology brought to us by the public relations arm of the fossil fuel industry is that we need not worry about sufficient energy supply--a story they've been touting since the lows in oil prices in 1998. Every step of the way on the path to the price spike of 2008, the industry said big new supplies were just around the corner.

When a special kind of hydraulic fracturing made new oil deposits available in the United States, only prices near $100 a barrel made them economical (as we can see by the widespread bankruptcies among those companies reliant on such deposits in the recent low-price environment).

It's those high prices which I believe have slowed the economy making oil now seem temporarily plentiful. If we don't go into a major recession or depression, a rise in demand could send prices soaring and put further pressure on overall productivity growth while increasing energy bills for households. That would set the stage for more discontent among those who believe that increased economic global integration is hurting rather than helping them.

Kurt Cobb is an author, speaker, and columnist focusing on energy and the environment. He is a regular contributor to the Energy Voices section of The Christian Science Monitor and author of the peak-oil-themed novel Prelude. In addition, he has written columns for the Paris-based science news site Scitizen, and his work has been featured on Energy Bulletin (now Resilience.org), The Oil Drum, OilPrice.com, Econ Matters, Peak Oil Review, 321energy, Common Dreams, Le Monde Diplomatique and many other sites. He maintains a blog called Resource Insights and can be contacted at kurtcobb2001@yahoo.com.

Sunday, June 19, 2016

Disconnect: Congressional hawks hate sustainability, but love military that seeks it

Recently, I toured a U.S Navy mine sweeper and destroyer during Fleet Week. Just before the tour entrance line a tent with exhibits caught my attention. On the first table were a set of small bottles containing various kinds of liquid fuels, a sampling meant to highlight the biofuels now being developed and used by the Navy. At the second table I was greeted by a Navy public relations specialist who handed me a quarterly magazine devoted exclusively to the Navy's energy and environmental initiatives.

The U.S. Navy isn't the only service seeking to make itself less dependent on fossil fuels and friendlier to the environment. The U.S. Department of Defense (DOD) has committed itself to more sustainable practices and alternative fuels across all services. The reason: The DOD takes climate change and fossil fuel dependence as serious risks to the nation's security and to the U.S. military's own ability to fight and protect the nation.

Why does the U.S. military establishment take these threats seriously and act on them in such a thoroughgoing fashion while the military's strongest congressional supporters are the most ardent opponents of sustainable practices?

Using the hawkish Center for Security Policy's (CSP) 2013-2014 congressional scorecard as a proxy for devotion to all things military, we find 21 so-called "champions" of national security in the U.S. House and Senate who voted for all items favored by the CSP during the session. Among those 21 legislators, nine had a 0 percent rating from the League of Conservation Voters for 2014, four had a 3 percent rating, four had a 6 percent rating, one had 20 percent rating, one had a 60 percent rating, and two were not rated.

This is not a perfect indicator by any means, but it provides a general outline of the disconnect between a military establishment which has embraced sustainability and its most ardent legislative supporters who refuse to recognize and act on those same imperatives for sustainability in the civilian economy.

Certainly, part of the explanation is that the budget of the U.S. military is very large, and many constituencies which benefit from it in both political parties need to be satisfied before it can pass. But another part of the explanation is the way the military assesses risk versus the way we assess risk in the civilian economy.

For military commanders every decision has life-and-death implications. Poor planning for any part of military operations--food, clothing, shelter, fuel, weapons, ammunition, intelligence, transport, coordination with other armed services, and so on--can hinder success and cost lives. Contingencies, however remote, are often considered since they can mean substantial loss of life if ignored. Essentially, mission planners are asking, "What if?"

Climate change models suggest widespread disruption of agriculture, water supplies and coastal settlements (due to sea level rise) resulting in growing instability around the world and leading to increased military threats. A 2015 DOD report to Congress on climate-related risk summarizes the department's thinking.

The DOD also understands that renewable energy gathered on military bases is less vulnerable to disruption from hostile actions, actions that could prevent imported fuel from reaching those bases and which could also compromise civilian electrical grids. The department has therefore adopted aggressive goals for renewable energy with the Navy setting a 50 percent goal by 2020.

Why is the DOD moving so fast? Because it perceives that risks related to fuel supplies and climate change are real and immediate. The department believes these risks must be addressed now to maintain readiness not only for violent attacks from hostile forces, but also for sustainability in peacekeeping operations and humanitarian missions.

Why are we not applying the same analysis to the U.S. civilian economy? Certainly, there are many people who do, but they have not been able to convince enough federal legislators to move more quickly on an energy transition that would both lessen our dependence on fossil fuels and mitigate climate change.

But the most important difference is that in civilian society we have to set policy by consent, by legislative action. In the military, policy can be set by top commanders and enforced, policy that often puts security above cost and that fossil fuel lobbyists are generally impotent to alter.

Moreover, civilian society operates under a market system in which priorities for investment are affected by millions upon millions of buying and investment decisions made by individuals and companies. And, those individuals and companies have a say in public policy, a say that tends to value stability over change.

For example, utilities are being forced to adopt renewable energy targets by state utility commissions around the country. But, it would be difficult to force those utilities to shut down, say, half their fossil fuel plants by 2020 without bankrupting them and endangering the stability of the electrical grid to boot. Existing infrastructure is not so easily disposed of because its owners want to get maximum value out of it before disposing of it and because its integration with larger systems (such as the electrical grid) must be carefully taken into account.

Still, the threat of climate change to food and water supplies, to the stability of existing infrastructure including coastal settlements, and to the health of human populations (more very hot days and more tropical diseases) suggest that adapting to and mitigating climate change ought to be as much a priority in U.S. civilian society as it is in the U.S. military. And, we now have compelling demonstrations from the military that a rapid transition can take place.

All we have to do is to find the will to make that transition. The military recognizes that its effectiveness at its mission is at stake. If only we civilians everywhere could embrace alternative energy and climate-change adaptation and mitigation with the same zeal, maybe the very conflicts which the U.S. military anticipates as an outcome of climate change and resource pressures could be considerably lessened or eliminated.

And then, just maybe the sailors I met during Fleet Week wouldn't have to fight in conflicts related to those twin risks because we civilians would be taking climate change and energy resource pressures as seriously as they do and doing what is necessary to address them.

Kurt Cobb is an author, speaker, and columnist focusing on energy and the environment. He is a regular contributor to the Energy Voices section of The Christian Science Monitor and author of the peak-oil-themed novel Prelude. In addition, he has written columns for the Paris-based science news site Scitizen, and his work has been featured on Energy Bulletin (now Resilience.org), The Oil Drum, OilPrice.com, Econ Matters, Peak Oil Review, 321energy, Common Dreams, Le Monde Diplomatique and many other sites. He maintains a blog called Resource Insights and can be contacted at kurtcobb2001@yahoo.com.

Sunday, June 12, 2016

Can the world go all-electric?

Recently, word leaked out that Norway may ban the sale of diesel- and gasoline-powered vehicles by 2025. The move toward electric vehicles is part of a dream shared by those concerned about climate change and about fossil fuel depletion (especially oil depletion), namely, to turn the world into one big all-electric paradise by running everything we can on electricity.

Theoretically, this is possible, but getting there won't be easy. First, such a transition will take time. In the Norwegian example cited above, the transition to an all-electric private car fleet would take about 15 years based on Norwegian new private car registrations in 2015 and the current total number of registered private cars.

But the ban wouldn't take effect until 2025. While Norwegian electric car registrations are rising, so are total car registrations. Even if we generously assume that the rise in electric car registrations between now and 2025 will shave five years off the transition, that still means Norway won't achieve an all-electric private automobile fleet until 2035. And, Norway is already a leader in the move toward all-electric transportation. Other countries lag far behind.

The Norwegian example points out a second difficulty in the transition to an all-electric world. Norway gets 95.9 percent of its electricity from hydroelectric dams. It gets another 1.6 percent from wind turbines. Only 2.5 percent of its electricity comes from thermal power plants, the kind that burn fossil fuels such as coal and natural gas and that provide 66 percent of the world's electricity.

Transitioning to electric transportation in places that primarily burn coal, natural gas and/or diesel fuel to produce electricity would undermine the goal of lowering greenhouse gas emissions. In thermal power plants, the ones that burn fossil fuels, two-thirds of the energy produced is lost in the form of heat. Only one-third is turned into electricity.

Electric automobile manufacturers claiming that their cars get the equivalent of 100 miles per gallon aren't factoring in the fossil fuel portion of the electricity used to power such cars. And, while electric automobiles reduce emissions to zero at the site where you use them, if they are powered exclusively by electricity generated from fossil fuels, the actual miles per gallon equivalent may drop to between 30 and 40. That would make such electric cars no more climate-friendly than high-mileage gasoline-powered cars and less climate-friendly than some hybrid-electric cars.

The Union of Concerned Scientists in a 2014 update of an earlier survey outlines the best regions in the United States for electric vehicles based on the fuel mix of utilities. Where nuclear and renewable power are highest, emissions are, of course, lowest. That's why electric transportation only really addresses climate change when it is powered primarily by electricity from nuclear and renewable energy.

Of course, transportation is not the only area that we could electrify. While most industrial processes are powered by electricity, many industries require process heat to melt metals, foster chemical reactions, and cook and bake foods. These industries usually burn fossil fuels for that heat, mostly natural gas. Using electric heat would be extremely inefficient and injurious to the climate in this case unless, of course, the electricity comes from nuclear and/or renewables.

Let's not forget that homes, stores and offices need heat in colder climates, most often supplied by heating oil and natural gas. The same tradeoffs exist for these users as for industrial firms needing heat for their various processes.

While renewable energy is growing rapidly, a full transition to a renewable energy economy is still decades away. Projections from the U.S. Energy Information Administration (EIA) suggest continued heavy dependence on fossil fuel energy as late as 2040. That is a recipe for climate disaster if we are supposed to reduce carbon emissions worldwide by 80 percent by 2050 in order to maintain a livable planet.

In addition, the EIA projection for oil (lumped under "liquids" in the EIA's chart) may not be realistic given what we know about the cost of extracting much of the remaining oil from tar sands, the Arctic and the deep ocean. A considerable amount of oil touted as available to us in the future may simply not be cost-effective to extract.

So, we are faced with twin limits: the amount of carbon dioxide we can safely dispose of in the atmosphere and the amount of cheap oil left to extract.

The seemingly obvious solution is a very rapid transition to low-carbon or no-carbon energy in the form of renewables and nuclear power. The pace of the renewable energy build-out is impressive. But it is doubtful that such a build-out can proceed at a rate that will not only add to current electric generating capacity in order to meet new demand from transportation and growing demand from residential, commercial and industrial users, but also replace enough existing fossil-fueled plants in time for our rendezvous with 2050. Nuclear power is unlikely to expand much given public opposition due to safety concerns and given the decommissioning of older plants. Both renewable and nuclear power require some fossil fuel energy to build and service since 84 percent of the the world's energy currently comes from fossil fuels.

This brings us to a less risky, but nevertheless challenging strategy for addressing our twin crises. We could reduce dramatically the amount of energy we require. While we need to continue the renewable energy build-out and quicken its pace, we also need to meet that build-out halfway by reducing our energy use. The trouble with our current system is that if one group of people, say, the European Union, reduces its energy use overall, another group, say, fast-growing Asian nations, may be glad to buy the unused energy resources (mostly fossil fuels) now available at prices made lower by reduced EU demand.

This is called the Jevons Paradox in which increased energy efficiency actually creates more demand. To reach our goal of drastically cutting emissions and still have enough renewable energy to meet the needs of a modern technical society, we would actually need to put limits on fossil fuel energy use in order to short-circuit Jevons Paradox which could lead to increased rather than reduced burning of fossil fuels. As long as energy demand continues to grow and as long as we depend so heavily on fossil fuels for that energy, we run the risk of destroying our habitable climate, finding ourselves without the necessary energy to run our economies and/or paying a price for energy that our economies cannot bear without sinking into stagnation.

What this suggests is that economic growth itself might have to slow or even stop altogether. That could spell widespread economic and social problems in a society that has been designed only for continuous economic growth.

The methods for drastically cutting energy use are already available. We don't require new technology (though new technology will likely make energy use even more efficient). So-called passive house methods (which can and are being used for commercial and industrial buildings) can reduce heating and cooling needs by 80 to 90 percent. Widely available LED lighting offers deep reductions in energy use while providing that same level of light. Simply changing the way we do things can have a dramatic effect on energy use. Such nonprofits as the Rocky Mountain Institute have been showing government and industry how to reduce energy consumption dramatically by changing processes using existing technology.

Going all-electric or mostly electric has clear advantages. Electricity is an extremely flexible form of energy that can be applied to widely disparate tasks. Lighting rooms, heating water, and refrigerating food are typical household examples. A major argument for moving toward electricity derives from the simple fact that the most cost-effective form of renewable energy is electricity.

In order to make a climate-friendly transition that electrifies those areas of our economy that are not already powered by electricity, we would have to transition our electric generation simultaneously to renewable energy. Success would depend on government policies and an alert public willing to pay the costs of such a transition and willing to change the way it lives in order to accommodate that transition.

One example of a possible accommodation comes from the fact that renewable electricity sources such as wind and solar are intermittent. We get them only when the wind blows and the sun shines. For this reason, cheap electric energy storage has been considered a prerequisite before wind and solar could dominate electricity generation.

But one alternative would be to manage the intermittent nature of such sources by managing when we perform certain tasks. Those that are more critical might be scheduled during daylight hours when sun and possibly wind are both available. This is the kind of change that may very well be necessary as part of an electric transition, a transition that would require a revolution both in policy and in expectations concerning our daily life and work.

UPDATED June 14, 2016

Kurt Cobb is an author, speaker, and columnist focusing on energy and the environment. He is a regular contributor to the Energy Voices section of The Christian Science Monitor and author of the peak-oil-themed novel Prelude. In addition, he has written columns for the Paris-based science news site Scitizen, and his work has been featured on Energy Bulletin (now Resilience.org), The Oil Drum, OilPrice.com, Econ Matters, Peak Oil Review, 321energy, Common Dreams, Le Monde Diplomatique and many other sites. He maintains a blog called Resource Insights and can be contacted at kurtcobb2001@yahoo.com.

Sunday, June 05, 2016

Taking a short break - no post this week

I'm taking a short break and expect to post again on Sunday, June 12.

Sunday, May 29, 2016

The faux insurgency of the climate change deniers and the need for closure

Climate change deniers like to style themselves as latter-day Copernicuses and Galileos, lone visionaries bucking the established wisdom of the ages embodied back then in the teachings of the Catholic Church.

There is a certain appeal to imagining oneself as isolated and embattled but unbowed. The analogy, however, is specious on its face. For neither Copernicus nor Galileo had giant international oil and coal companies supporting them with tens of millions of dollars of annual public relations expenditures and scores of fake think tanks which would have provided them comfortable and profitable sinecures while shielding them from the attacks of the church.

No, the climate change deniers actually work for the established church of our age, wealthy corporate interests opposed to doing anything to mitigate the ongoing carnage of climate change--the very interests that continue to have a stranglehold on the legislative bodies of the world to such an extent that relatively little has actually been done to address climate. The most compelling evidence is the steady march upward of atmospheric carbon dioxide levels measured at the world's best known measuring station, the Mauna Loa Observatory.

To hear the deniers one would think that we are already groaning under the weight of carbon taxes across the globe. The reality is that only a handful of countries and jurisdictions have bothered with such taxes, and one of them, Australia, repealed its tax. Yes, yes, there are cap-and-trade emissions schemes in the European Union, northeastern United States, California and Quebec. None of these jurisdictions has collapsed economically as a result. In fact, all are becoming leaders in a technological revolution that is moving us away from dependence on finite, climate-changing fossil fuels.

The real insurgents, the real Copernicuses and Galileos, then are the pioneers in climate research including the originator of the aforementioned measuring station at Mauna Loa, Charles Keeling. Keeling began taking measurements of atmospheric carbon dioxide at Mauna Loa in 1958, observations which constitute the longest series of carbon dioxide measurements available and which are now called the Keeling Curve. In the early years, Keeling had difficulty maintaining funding for measuring something that seemed unimportant at the time.

Strangely, we now know that much excellent research on climate change was done by Exxon Corp., the world's largest oil company, in the 1970s and 1980s. Later the company chose to bury that research and deny the importance of climate change, thus switching sides from climate pioneer to climate change denier. The company threw its enormous financial resources behind a network of advocacy organizations and fake think tanks acting as front groups for its agenda to forestall action on climate change. Talk about inconvenient truths!

What group of well-intentioned Galileos actively tries to thwart discovery, inquiry and debate when that group already knows from its own research that the truth is the opposite of what it is saying? We now know that is what the climate change deniers have done for more than two decades.

What they are sore about is that they've been exposed and they've lost the fight, at least over whether climate change is real and whether humans have the lion's share of the blame for it.

Commenters on my climate-related pieces often include deniers who get upset when I refuse to post their comments or delete their comments when they do get through. Deniers protest that I am censoring them and that I'm not interested in a discussion with people holding opposing views. (Never mind that many of those people are paid to hold and propagate those views.)

It is a common tactic to claim that all publications ought to be billboards for climate change denialism and that those that refuse to make themselves available for this purpose are not interested in genuine inquiry and debate.

First, privately-owned publications in the United States and many other countries have the right to publish whatever they please and not to publish whatever doesn't please them. This is the very essence of freedom of the press--not to be coerced by anyone.

Censorship then cannot emanate from a privately-run publication, broadcast or video service. It can only come from the government coercing such media outlets to run or NOT to run something.

The deniers have their own websites, their own publications, even their own cable news network, namely Fox. No one is preventing these media from denying the human role in climate change. They do it every day.

The second charge, that those who refuse to engage with deniers are not interested in genuine inquiry and debate, is also a trick. There is nothing in my right to free speech and inquiry which obliges me to engage with people I do not wish to engage with. Nothing! Freedom of speech and freedom of association mean that I'm free to research and write about topics in any lawful way that I see fit.

Genuine engagement presupposes one very important thing: that both sides are open to logic and evidence and the possibility of changing their minds. Where that is not the case, the only result can be stalemate.

I would be greatly relieved if bona fide climate scientists discovered compelling and convincing scientific evidence that countermands all that we currently understand about climate change and that shows we are, in fact, about to experience a regression to the climate I grew up with. This is always a possibility even though it seems highly unlikely given what we already know. I am, of course, not talking about cherry-picked data taken out of context from the very climate scientists that deniers despise, but a profound alteration of the contours of climate science as we know it.

A denier never admits the possibility of changing his or her mind. Just ask a climate change denier what will convince him or her that climate change is real and caused by humans. I guarantee that he or she will not have a response. Evidence simply doesn't matter, so they have never considered what evidence would convince them to change their minds.

The deniers are free to try get people to listen to them. If I were physically to prevent others from listening to them (unless those others are minors under my guardianship), then I would be guilty of coercion. But I haven't done that and won't do that. I'm already quite good at convincing the people I can reach not to bother listening to deniers.

Here are the crux of the deniers' strategy and the horrible implications of it: The deniers want to convince the world that no policy action can be taken so long as there is any disagreement. They somehow pretend that there must be 100 percent consensus one way or the other.

The hypocrisy of this, of course, is that there is no 100 percent consensus that we should continue to burn fossil fuels; yet, by policy we continue to do so in large quantities every day. Would the deniers consent to a moratorium on burning fossil fuels so long as there is a debate about the consequences of burning them? When the shoe is on the other foot, it doesn't fit so comfortably, does it?

I'm sure deniers will be shocked, SHOCKED, to find out that public policy is always made without 100 percent certainty. Were it not so, there would be no public policy at all. Deniers know this, and that's what they want, public policy paralysis.

But there is something else that is disturbing about the deniers' tactics when we look at such tactics through an historical lens.

No doubt there are those who even today might argue that slavery ought to be legal. After all, the Bible, the holiest of books in the Christian world, sanctions slavery. And, the Bible was a frequently used weapon by the slaveholders and their apologists. Perhaps in the interests of honest inquiry we should engage those who argue for the reimposition of slavery.

Too farfetched? How about those who continue to argue for segregation of the races? Today we call them white supremacists. Shall we give them our ear in order to make sense out of the debate over segregation? Should we withhold our judgment about segregation until all the facts are in? (I am generously presuming that a white supremacist could actually give me facts.)

How about women's suffrage? There are cultures yet today that do not believe women should have a role in governing their own societies. Women, they say, are too immature and weak-minded to participate in such a lofty enterprise. Perhaps we should listen to those advocating the end of women's suffrage (or its prevention where it does not already exist) so we can try to discern whether we should take the vote away from women in our own societies.

As hard as it is to believe, some debates are actually closed. Yes, there may be a few dissenters left, but they are almost exclusively talking among themselves.

But those are social issues, you may say. Scientific inquiry is never closed off. Ideally, that's true (although one should note that in the cases cited above scientific arguments were made supporting slavery, the superiority of whites and the inferiority of women).

Scientific inquiry should and does go on even after policy decisions are made. But as a practical matter, we as a society through industry associations, for example, come to common understandings leading to product standards. It would be impossible to produce and use a cellphone without such standards. We could not do such a thing if we insisted that no cellphone be produced as long as there is not absolute agreement about all the aspects of physics thought to touch even remotely on their function (which there isn't since the science of physics is an open enterprise always subject to change). We do the same through government with regard to clean water and clear air regulations. Our understanding continues to evolve in both areas. But that does not prevent us from making needed policy and product standard decisions.

Keep in mind that the same people who brought us the full-throated defense of cigarettes as a harmless pastime have brought us the well-appointed packaging of climate denialism. I can only say that if they are true to their convictions, they should now all be chain-smoking cigarettes without any mental reservation or fear.

Society as a whole through its government cannot be effective if it must wait for every dissenter to quiet down. In fact, waiting for all dissent to dissipate would be the equivalent of not governing at all.

Representative government is a mechanism for debate, for letting those who dissent from the majority to be heard and possibly persuade. But then it's time for action, and those on the losing side are not asked to relinquish their free speech rights, but rather asked to accept the will of the majority (at least until such time as the issue is properly placed before the legislature to reconsider).

Those who deny human-caused climate change have been and continue to be free in most countries to say whatever they please. The real problem the deniers are having is that their audiences are getting smaller and smaller. That's what happens when you don't have a very compelling argument and the total weight of the evidence is so lopsided against you.

Kurt Cobb is an author, speaker, and columnist focusing on energy and the environment. He is a regular contributor to the Energy Voices section of The Christian Science Monitor and author of the peak-oil-themed novel Prelude. In addition, he has written columns for the Paris-based science news site Scitizen, and his work has been featured on Energy Bulletin (now Resilience.org), The Oil Drum, OilPrice.com, Econ Matters, Peak Oil Review, 321energy, Common Dreams, Le Monde Diplomatique and many other sites. He maintains a blog called Resource Insights and can be contacted at kurtcobb2001@yahoo.com.

Sunday, May 22, 2016

Saudi Arabia is planning for the post-oil era, why not the United States?

The world's largest exporter of crude oil, the Kingdom of Saudi Arabia, recently announced a plan for its post-oil future. If a country almost synonymous with the oil economy can see the need for such a plan, how can the rest of the world, particularly the United States, the world's largest consumer of petroleum, not see the necessity of such foresight?

The kingdom's plan includes sale of part of Saudi Aramco, the world largest oil company and currently wholly-owned by the Saudi government. The company controls all oil development in Saudi Arabia. That the Saudis want to sell part of the most valuable company in the world means they have a different view about the future of oil than those who will be buying. Commentators often report that markets rise because investors are optimistic or fall because they are pessimistic. But this is complete nonsense because for every buyer there is always a seller. Each side of a trade believes in a different future for the investment being traded.

Certainly, there are many reasons for selling a minority stake in Saudi Aramco. But one of them can't be that the rulers of the kingdom have an unalloyed bullishness about Saudi capabilities and oil resources.

As recently as 2007 the U.S. Energy Information Administration (EIA) believed Saudi Arabia would be supplying the world with 16.4 million barrels per day (mbpd) of oil by 2030. (And, that was down from 23.8 mbpd projected for 2025 in a 2003 report.) In 2008 the Saudi king appeared to embrace a policy of 12.5 mbpd and no more.

Since then long-term projections for Saudi production have come down with a range of 10.2 mbpd to 15.5 mbpd for 2040 (in a 2013 EIA report) depending on which of three scenarios you choose. No explicit range has been included in subsequent EIA reports.

With the release of a new independent report on world oil reserves by a former BP insider, a report that suggests that conventional reserves are half what is being claimed, the issue of limits on oil production has resurfaced. (The report implies that Saudi reserves have been inflated as well.)

By including Canadian tar sands and Venezuelan heavy oil, world oil reserves increase back to about 75 percent of what is typically reported. But that number makes no adjustment for the much greater difficulty and expense of getting these unconventional resources out of the ground and then turning them into something we call oil. The financial debacle taking place in the tar sands under the current low-price regime is clear evidence that those resources cannot be sustained without high prices.

The temporary glut we are experiencing now, however, does not disprove limits. It only shows that we can still have market cycles in oil just as we did in 2008 when oil fell from $147 per barrel to around $35 in six months. By 2011 oil was back above $100, where it stayed with only brief forays under that price, until the end of 2014. This period has so far given us the highest inflated-adjusted average daily prices for oil ever.

For those who believe the United States does seem to have energy policies relevant to a post-oil world, I would answer that this is not the result of some grand design, but rather due to a hodge-podge of programs, many of which are conflicting. Even as the U.S. tax code continues to provide substantial subsidies for oil and natural gas production, it also provides substantial subsidies for renewable energy such as solar and wind. But these renewables subsidies are really about producing electricity.

Subsidies for liquid fuels, the kind that replace fuels from oil, have been reduced. The federal subsidy for ethanol ended in 2012. Subsidies for biodiesel and other biofuels continue.

While ethanol was always really an energy carrier and not an energy source--it takes about as much energy to produce corn ethanol as it yields--biodiesel is believed to have a positive energy balance. Even so, converting the U.S. vehicle fleet to biodiesel isn't in the cards, and doing so would require so much farmland to grow the necessary oil crops that we might be able to drive, but probably not eat--an absurdity of the first order.

Now granted, a post-oil society doesn't necessarily mean a no-oil society. Oil supplies may decline gradually after a future peak in production. We won't, as the critics say, "run out." That's just a canard meant to prevent people from understanding the serious implications, not of running out, but of having less each year.

There is the option of moving to electrified transportation which I support. But most people think of this as a move toward electric cars. The entire car fleet in the United States currently takes about 14 years to turn over. But, of course, we'd only get replacement of all vehicles with electrics over this period if we started selling 100 percent electric-only vehicles now. Moreover, certain types of transport--emergency services, farm equipment and rural transport--will likely require liquid fuels for a long time to come.

Because we are only very gradually increasing the number of electric-only cars available for purchase, it would likely take two to three decades for a complete transition away from oil-fueled vehicles. It would be much wiser to electrify and vastly expand public transportation, something that isn't on the policy radar in the United States.

There are certainly local efforts to expand bicycle lanes and pedestrian areas to reduce dependency on motorized transportation. But those efforts can hardly be called coordinated and rapid.

If we had absolute clarity on future oil supplies, we'd know how quickly we must make the transition away from oil. But we don't have anything approaching that. Instead, we have competing estimates and timelines, and--here's the important part--we Americans have chosen to embrace the optimistic forecasts without understanding the risks because doing so takes the pressure off of us to make the necessary changes. (And, we do this in spite of the fact that supposedly ample U.S. production is now once again in decline.)

The Saudi move toward a post-oil economy ought to be one of the strongest messages ever that the world is moving closer to a peak and decline in world oil production. The kingdom's actions are telling us that the world's largest crude oil exporter feels it must start today to plan and implement a post-oil economy.

Will we Americans (and others who haven't yet) take the hint seriously?

Kurt Cobb is an author, speaker, and columnist focusing on energy and the environment. He is a regular contributor to the Energy Voices section of The Christian Science Monitor and author of the peak-oil-themed novel Prelude. In addition, he has written columns for the Paris-based science news site Scitizen, and his work has been featured on Energy Bulletin (now Resilience.org), The Oil Drum, OilPrice.com, Econ Matters, Peak Oil Review, 321energy, Common Dreams, Le Monde Diplomatique and many other sites. He maintains a blog called Resource Insights and can be contacted at kurtcobb2001@yahoo.com.

Sunday, May 15, 2016

We are all Albertans now

It would be easy--too easy--to point to the wildfires which have devastated huge areas of northern Alberta near Fort McMurray, the hub of tar sands mining in Canada, and say that Albertans are reaping what they have sown. Yes, it's true that climate change is coming to one of the very areas which is contributing disproportionately to climate change and with catastrophic results.

The source of the current catastrophe is that the boreal forest which surrounds the tar sands has been turned into a tinderbox because of increasingly warm, dry weather that used to be uncharacteristic of this area of Alberta. But, what is happening in Alberta was predicted decades ago to be one of the consequences of unchecked global warming.

Having said all that, we should remember that the warming we are experiencing today is actually the result of greenhouse gases dumped into the atmosphere as of 40 years ago or so. (The analysis cited gives a range of 25 to 50 years, a lag related to what is called the thermal inertia of the oceans.) If this is the case, what Albertans are experiencing today has almost nothing to do with the climate effects of tar sands exploitation since there was very little production from Alberta's tar sands that long ago.

What this means, of course, is that there will be much worse to come even if today we were to reduce to zero all greenhouse gas emissions and other factors which are raising worldwide temperature.

The problems we are already seeing such as increased flooding in some places; increased drought in others; sea-level rise that is already swallowing islands; the rapid change in climate zones (which affects what we can grow in those zones); and myriad effects on plants and animals around the globe as their habitat shifts or disappears--all of these are just the beginning. And, there is no reason to believe that global greenhouse emissions and other causes of climate change such as deforestation will reverse their trends anytime soon.

When thinking about the Alberta wildfires, there is something else we must remember. Tar sands oil combined with oil from America's fracking boom have been the only reason that oil supplies worldwide have been able to grow. The very sources of oil that have been vilified as a new assault on climate have until recently found ample demand for their product. With production from both these sources now contracting due to low prices, we may in the not-to-distant future face oil price spikes.

As a global society, we still want all the conveniences which oil provides without the bad side effects. As such we must now consider ourselves Albertans no matter where we live and understand our complicity in their plight--and, why their plight is becoming our own.

However carbon-intensive extracting oil from the tar sands may be, shutting down one source of oil is hardly a solution to the climate problem. Our challenge is to shut down our own demand for oil and other fossil fuels. That strategy would make high-cost oil sources such as the Canadian tar sands and America's deep shale deposits its first victims and accomplish through demand reduction what all the public protests to date have failed to achieve.

Kurt Cobb is an author, speaker, and columnist focusing on energy and the environment. He is a regular contributor to the Energy Voices section of The Christian Science Monitor and author of the peak-oil-themed novel Prelude. In addition, he has written columns for the Paris-based science news site Scitizen, and his work has been featured on Energy Bulletin (now Resilience.org), The Oil Drum, OilPrice.com, Econ Matters, Peak Oil Review, 321energy, Common Dreams, Le Monde Diplomatique and many other sites. He maintains a blog called Resource Insights and can be contacted at kurtcobb2001@yahoo.com.