The modern industrial lifestyle is predicated on oil. This notion is widely accepted in American society. Less so is the idea that oil supplies are depleting to the point that rising prices will affect — and in fact currently are affecting — the economy in significant ways. Perhaps even less accepted is the notion that, in a world with less oil, we can’t simply sit back and wait for the next technological breakthrough to solve our energy problems for us — we have to change the way we live.
We won’t be hitting empty overnight, but inevitably and soon, global demand for oil and natural gas will outstrip global extraction and supply. This situation may not sound so dire — until one considers the long-term implications. I study energy issues and have been teaching college classes on the subject for some years now. My understanding of the complexities of energy supplies and their interrelationships with the global economy, geopolitics, food production, transportation, and more, lead me to a sobering conclusion: oil depletion is truly a game changer for modern industrial societies. As evidenced by the Occupy Movement protests in U.S. cities and around the world, people everywhere are already experiencing the impacts of economic problems that stem, in part, from oil depletion — and this is just the beginning.
High prices of oil have historically translated into economic recession because oil isn’t just any commodity — it’s the driving force of the industrial world itself. If and when the global economy recovers significantly from the Great Recession, increased demand for oil will spur higher prices for this depleting resource, resulting in another economic downturn. As we approached the economic collapse in fall of 2008, oil production was running basically flat out. There was very little spare production capacity to be had in world oil markets. Oil prices spiked and placed significant economic strain on the heavily indebted, thereby contributing to the economic crisis. Given the likelihood of continued oil price volatility, we’re in for a bumpy ride.
But why can’t we simply find more oil or find effective substitutes? For one thing, we’ve waited much too long to avoid big problems, and for many reasons, simply replacing oil or finding much more of it aren’t exactly simple strategies. Understanding why this is so entails developing an understanding of the energy system as a whole within the context of broader society.
Let’s start with oil depletion. It’s a documented fact. Geologist Dr. M. King Hubbert predicted the 1970 peak in oil production in the U.S. — and yes, that’s over 40 years ago! In hindsight, peak production makes sense. Oil is nonrenewable and under pressure from the layers of rock and earth above it. The liquid oil is more than ready to escape upward through any crack or borehole that penetrates its cap rock, which means efforts needed to extract it are low at first. As more wells are drilled, production increases (and pressure within the field drops) until production peaks. After that, production declines as the oil becomes, in effect, harder to reach. Once foremost among petroleum exporting nations, the U.S. currently imports almost half of the oil it consumes. The figures were closer to 60% before the economic downturn, and a significant portion of what is counted as domestic oil supplies in these figures is actually biofuels, mostly corn-based ethanol. Many respected geologists who specialize in estimating oil reserves believe we have already passed the global production peak.
We have a problem — and the fixes cited by technological optimists don’t offer complete solutions. Simply finding a lot more oil is not an option. Global oil discoveries peaked in the middle 1960s. If this trend could be reversed by using technological advancements, there’s little doubt it would have been by now. The globe has been pretty thoroughly explored by petroleum geologists, and new finds typically don’t compare well in size to earlier ones.
We must also consider net energy. Early oil produced from a field requires little effort to extract, but later, the efforts required to “lift” oil from a declining field intensify so that the energy profit from the endeavor declines. Eventually, extraction becomes an energy-losing proposition. It takes more energy to get the oil out of the ground than is contained in the oil extracted. At this point, oil is not an energy source at all, but an energy sink. For some energy “sources” such as hydrogen that are cited as potential major contributors to a new energy economy, the net energy picture is particularly poor. Hydrogen must be refined from natural gas or electrolyzed from water. In accordance with the laws of thermodynamics, the resulting hydrogen actually has less energy available for use than was available from the electricity or the natural gas used to create the hydrogen. While hydrogen may prove useful as a storage medium for excess energy generated from renewable sources, it’s hardly an energy source.
Some optimists cite advanced technologies employed in discovering and producing oil as the answer to our supply problems. But they do so without acknowledging that these investments also represent energy investments and that the harder we work with these new technologies, the lower our net energy return. In any case, even if we could dramatically increase flows of petroleum using these technologies, doing so would only increase the potential for an energy crash later because we’d be more quickly using up the oil we have.
Some cite energy efficiency gains as pointing the way out of our energy conundrum, noting that over time, we’ve learned to do more with less energy. But efficiency means little without reduced total usage. In a context of worldwide population and economic growth, the global energy budget is rises quickly. Perhaps the main reason we don’t easily recognize the energy crisis in our midst is because the Great Recession and its aftermath have translated into reduced production and consumption by many, sometimes through the painful process of unemployment. In the energy world, increased efficiencies also correlate with increased energy density (more energy “bang” per unit of the material used). Increased efficiencies will be harder to achieve if we attempt to drive the globalized economy with renewable energy and coal — both of which are much less energy dense than oil.
Some cite natural gas as a substitute for oil and point to shale gas deposits, particularly in the northeastern U.S., as the answer to our energy problems. As geological consultant Arthur Berman has noted with regard to the Barnett Shale in Texas, the depletion rate for shale gas wells is extremely rapid, and estimates of total gas recovery potential are likely overstated. Furthermore, releasing the gas trapped in these formations requires hydraulic fracturing, a process that uses literally millions of gallons of water per well, not to mention the injection along with that water of toxic chemicals that can contaminate drinking water through accidental spills, deficient drilling practices, and perhaps other means. Do we really want to place our bets on yet another depletable energy source that has the potential to irreversibly damage our water? We can potentially live without oil, but we can’t live without water — not a single one of us. Some suggest we may rely on natural gas shipped by tanker across the ocean. This proposition would require heavy infrastructure (and, therefore, energy) investments, not to mention that the process of super cooling and shipping gas very negatively impacts net energy ratios. Natural gas is an efficient energy source when it can be shipped to users via pipeline, not when it’s transported long distance by tanker.
Oil shale and oil sands are also inefficient in terms of net energy as compared to petroleum. Oil sands are already being exploited as conventional oil supplies decline, but they won’t make up for conventional petroleum. What’s more, mining and processing of oil sands requires the utter destruction of ecosystems that are ravaged by strip mining, uses large amounts of fresh water, and releases large quantities of carbon dioxide, thereby exacerbating climate change. Is this a direction that we really want to go? As for oil shale, it isn’t oil at all, it’s source rock — oil that hasn’t been completely “cooked” in the earth’s crust. Recent experiments with in situ processing of oil shale have required using electric heating elements to heat the source rock underground for two the three years to finish the cooking process. In an effort to avoid groundwater contamination, experimental sites have also been surrounded by a layer of frozen ground. The net energy value of the oil obtained through such processes cannot possibly approximate that for conventional oil.
Transportation is a particularly sticky problem. The United States has bet on automobiles and trucks as the mainstays for transportation. Witness our underdeveloped rail system. With the global fleet numbering 700 million plus vehicles — each requiring the equivalent of about 90 barrels of oil to fabricate — and with miniscule to nonexistent infrastructure for alternative fuels, we face real problems. Some cite coal as a possible transportation fuel. Coal can be liquefied to produce synthetic petroleum. But we in the U.S. have no infrastructure for this, and there’s little of it globally. Dependence on coal for transportation would also require massive mining efforts — and we would be relying on a source of energy much less dense than petroleum (not to mention that we would seal our fate in terms of climate disaster).
Diesel vehicles can burn biodiesel or vegetable oil, but large scale growth and production of biofuels poses challenges. It’s not likely we could run all of our cars on biofuels the way we run them today on petroleum, even if we could change all our engines to diesels. The net energy harvested from biofuels production (when there is a positive net energy return) doesn’t come anywhere close to the net energy in oil. As we saw after the huge oil price spikes in the last decade, biofuels crops also compete for land with food crops when there are pricing advantages for producers to grow fuel crops. Renewable energy generated from wind and solar comes in the form of electricity, a fuel we don’t use in large measure for transportation. If we were to run our vehicles on electricity, we’d be back to the prospect of converting the immense global fleet to electric-drive vehicles, and we’d still face the question of what to do about large-scale shipping.
What about running industrial society on renewable energy? Currently, energy generated from renewable sources other than hydroelectricity (mostly large dams) and biomass (wood, animal dung, etc.) make up less than 1% of the world’s energy budget. Bringing enough renewable energy online to run the global economy as it is would require monumental efforts — technologically, politically, and in the business sector — not to mention a whole lot of energy. Don’t get me wrong, we do need more renewable energy generation, as much as possible. Countries and communities that know this and act on their knowledge will be more resilient in the years ahead — but we still need to change the way we live.
With regard to overall supply, oil isn’t likely to disappear overnight. A gradual decline in availability is quite possible, but rising global demand intensifies the potential for shortages. A growing world population, increasing consumerism, the spread of industrialism, and growing economies require ever more oil. What’s more, any significant negative growth in the global economy caused by an energy crisis could create cascading defaults and recession. The Great Recession and its vast social fallout are perhaps a timely foreshadowing of the immense and widespread economic and social effects of oil depletion — not to mention the simultaneously occurring massive disturbance and destruction of the natural world and human societies caused by fossil-fuel-generated climate change.
Our “options” are clear: try with all our might to hold back the energy watershed that is upon us, and waste our personal energy and creativity in doing so, or change the way we live. Can we change our minds and our energy systems in time to create a better world while doing so? Can we harvest energy without contributing significantly to global warming? What energy improvements can we make to our built environments? How can we retool our economy and our communities to soften the blows of petroleum’s decline? How can we reinvent fulfilling family and community life in a context of oil depletion? These are questions we must engage. The future health and security of people and nature the world over depend on it.
The answers we construct, individually and collectively, will indeed limit our dreams — but only if our dreams are about living “lifestyles of the rich and famous.” Limits to oil need not translate into limits to human creativity, limits to meaningful relationships with others and nature, or reduced personal growth. The challenges we face in the energy realm represent an opening for deep and wide ranging social change — and we need change. The dissatisfaction with the status quo evident in the Occupy Movement protests suggests we may be ready to change a lot of things, including the way we live and the dreams we have for a fulfilling life. The culture of celebrated hyper-individualism and “greed is good” may be unraveling in tandem with the emergence of the peak oil challenge. As many of us know, we are at a historic juncture. Will we find ways to run on empty with regard to oil and have full lives at the same time?