Don't Bet Against Innovation
In a rapid-fire, 21-minute talk that takes all your concentration to follow, Stanford University professor Frank Wolak races though his information-rich presentation during the 2010 Toyota Sustainable Mobility Seminar, trying to make the case that the future of energy is uncertain, not because of resource scarcity, but policy ambiguity.
Anyone attempting to measure the world's fossil fuel reserves, be it oil, gas or coal, will, he asserts, inevitably be wrong because they are basing their projections on current technology and market prices, neither of which are static. We are in a perpetual tug-of-war between resource depletion and technological innovation.
Historically, mankind has displaced relatively low-value fuels (wood) with ever-higher value ones: coal, oil and natural gas. The reason, he says, that oil is priced higher than coal is because of its versatility: it can be used to do many more energy tasks than coal. And the reason the price of oil fluctuates the way it does has more to do with cartel policy than market demand. The way to keep the cartel (OPEC) from manipulating prices and distorting classical market mechanisms is to find and utilize alternatives to oil: natural gas, biofuels and electric power.
The bottom line of Dr. Wolak's position is when it comes to the future of energy, 'don't bet against innovation.'
Other presentations from the Toyota Sustainable Mobility Seminar are, or will shortly be available on EV World.
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