Failing the Energy IQ Test

History suggests that energy is an IQ test that Americans tend to fail. In response to the Oil Crises of the 1970s, the United States wasted billions in a futile effort to jumpstart oil shale and other synfuels. Then federal automotive fuel-efficiency standards and flush production from newly discovered giant fields in Mexico, Alaska and the North Sea bailed us out. By 1985 oil prices had dropped to $10 a barrel and American energy policy went back to its default position, “stuck on stupid.”

With respect to today’s twin crises — accelerating climate change and an imminent peak in world oil production — our margin for error is far smaller. Consider our predicament: There are now 2.4 billion more people on the planet than there were in 1975. In the intervening three decades, we have used roughly 650 billion barrels of oil. Indeed, half the oil humans have used has been consumed since 1980. Although China has gone mad for cars and the world’s automobiles now consume four times more energy, in the form of fuel, than people consume in the form of food, this time there are few virgin giant fields waiting in the wings.

Global oil production has been rising for 150 years. In the 60 years since the end of World War II, it has risen eightfold. Here in the United States, we have built an entire civilization around inexpensive petroleum. Cheap oil, natural gas and electricity have governed our land-use patterns, automotive designs, architecture, agricultural systems and even our cast of mind.

Today a typical American travels the distance to the Moon every 20 years and consumes his or her body weight in petroleum each week. Human beings have always craved perpetual motion, and oil, for a moment, granted our wish to live like gods.

We are not running out of oil, but the era of expanding oil production is rapidly closing. We don’t think it makes sense to sugarcoat what peak oil means. Within a few hundred to a few thousand days, global oil production is likely to have peaked and be in permanent decline. If, by 2015, production is falling by 1 million barrels a day each year, that will represent the loss of as much energy as is provided by 80 nuclear power stations or 2 trillion cubic feet of natural gas. With respect to peak oil, we think it makes more sense to consider a wide range of intelligent responses rather than search for magic “solutions.”

If we want to craft a prosperous way down, there’s little time left. Time is our most precious and least understood resource. Money not spent today can be invested tomorrow, but time lost is gone forever. The excellent report, “Peaking of World Oil Production: Impacts, Mitigation and Risk Management,” by Robert Hirsch et al states that “more than a decade of intense implementation will be required for world-scale impact.”

Given fundamental energy realities and the degree to which we are hooked on oil and natural gas imports, the notion of seeking “energy independence” through greater drilling is, frankly, a fantasia. Imports now supply two-thirds of our petroleum liquids, plus 20 percent of our natural gas. Eliminating imports to enhance national security may sound worthy, but it is impossible. For the next couple of decades, we’ll remain “energy interdependent,” relying on large oil and gas imports to the extent they are available.

U.S. oil production has been falling for 30 years. North American natural gas production is now in decline, probably permanently. Some of the silver bullets sound great … until you do the math. Producing 10 million barrels per day of coal liquids would require doubling the amount of coal mined in this country, with massive climate impacts. A U.S. Department of Energy official recently opined that we could produce 2.5 million barrels a day from Colorado’s oil shales. Since that would require building 25 very large new power plants to heat the kerogen in the shale into oil, this is thermodynamic insanity. We could afford to chase panaceas in the 1970s, but not this time.

We agree with the Hirsch Report’s finding that our biggest challenge will be liquid fuels. Corn ethanol is a dog, but cellulosic biofuels have promise. Since today’s cars waste about 80 percent of the energy they consume, there are enormous opportunities to improve fuel efficiency through advanced engine designs, lighter vehicle platforms, hybrid drives and better tires. What’s our immediate strategy for averting the worst impacts of peak oil?

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