"Peak Oil" What does it Really Mean?



Image: flikr / Paul Lowry

 When I first learned about the concept of "Peak Oil", I have to admit, the concept startled me a bit.  I remember hearing that "my grandchildren will never know the experience of flying on an airplane."  The evidence was mounting and many experts agreed that there was little to no more major discoveries hitting the market coupled with the increasing demand across the globe for more and more oil production. 

The biggest challenge in sifting through the data and "expert" opinions is Who do you believe.  After learning many of the angels, I found this article very useful in taking a moderate approach to the concept of Peak Oil.

Robert Rapier explains the 5 misconceptions of Peak Oil in his article from The Business Insider 

Solar is Getting Cheaper

          Solar Is Getting Some Hot Attention. (sorry)

A recent article from the NYT reporter Paul Krugman dives into the viability of today's cost of solar power verses the conventional dirty power that we live off of today.  The op-ed article Krugman Op-Ed "Here Comes The Sun"  is also reviewed by Brad Plumer of the Washington Post in "Solar is getting cheaper, but how low can it go?" 

I have seen more and more rooftops outfitted with Solar Panels...hopefully soon it will be a normal thing to see, with a valid ROI.  Until then..."filler up"? 

The success of the future of solar depends upon the decrease in price of the cost of panels, but the manufacturing industry of solar related products better watch out.  China has huge subsidies to create solar industry, (the reasons for that is another topic all together) driving the prices down.  Solyndra is the first major casualty of this reality. 

The other big hurdle is what Brad Plumer refers to "grid parody".  Can the solar infrastructure get built properly and fit in with today's means of power supply?  We will see.

Either way, weather the technology comes from Asia, or the US, the solar industry is going to compete.  Lets hope the US gets a piece of the manufacturing base.

Fracking Blow Out in PA

Chesapeak Energy is making the news again...not the kind of news they want obviously.  A massive blow out took place yesterday April 20th in PA.  Thousands of gallons of potentially toxic fracing fluids spilled out across fields and into a local river. 

Francis Roupp, a deputy director of the Bradford County emergency services, said "many thousands" of gallons of fracturing liquids were released after a blowout near the well head. Roupp was unsure how much liquid was released, but he said it is possible that hundreds of thousands of gallons could have been released and have spilled across acres of pasture and into a small tributary to a local river. (See the rest of the story here Truth-Out.org )

This is the price of doing business as we search for alternative energy sources.  Nuclear fears arise with problems like we have seen in Japan, Blowout preventors unfortunaltey become a household term with the problems we see with BP and now the Marcellus Shale exploration and drilling. 

There is no easy answer to this in my opinion.

Increased Fuel Prices Pushing Millions Into Poverty (Food Shortages)

Following up on the heals of my last post about Lester Brown's film, The World Bank recently warned that the cost of food is sharply on the rise.  Looking at the increase they say that prices are 36% higher than one year ago.  A big factor in this increase is the cost of fuel. 

44 million people have been pushed over the poverty line with projections of significant increases on the horizon.  The turmoil in the middle east is partially to blame for this rise in oil prices and as Lester Brown mentioned, the water shortages pose an immediate risk.  If you listen to Robert Zoellick, President of the World Bank in this video on BBC he cautions of a "danger zone" if we see natural "weather events".  I suspect he is referring to a few different types of events that could cause disruption in the food supply chain such as; Draughts that may occur causing food shortages, hurricanes that cause further disruption in the fuel pipeline, etc...

We are looking at a perfect storm (pardon the pun).  The combination of increase fuel prices and the threat of weather events is making for a dangerous situation for the global food supplies.  The two are so intertwined, The World Bank President comments on the "Energy Food Price Connection" being much closer than it was 10 years ago.

I'm sure this comes as no surprise to anyone at this point.  Head to your local supermarket and you will see first hand how inflation has gripped our food supply.

Lester Brown's "Plan B" - Civilization Collapse directly linked to Food Production

Who Will Feed China.
 (Update...see entire movie below)

In a chilling documentary aired on PBS last night (3/30/11), actor Matt Damon (Goodwill Hunting) narrates the introduction to Lester Brown and his recent world tour that outlines Brown's "Plan B".  Brown's tour includes stops across the globe introducing powerful heads of state to the concept and historical thesis that the "failed state" civilization collapse are tied directly to food scarcity. 

The film opens with Brown explaining the domino effect of global warming and the direct impact to the Tibetan Plan "drying out", causing catastrophic disruption to the major rivers in Asia that are the lifeblood to the world's densest populations.  If these rivers are depleted, the impact to food production will be catastrophic and will lead to starvation globally.

Brown dives into population statistics to make his point clear.  The explosion in Asian population and the increase in purchasing power of those people moving up the "food chain" will strain the world's food supply and a tipping point will be reached.  Not only does the population increase strain the supply, but the recent conversion of grain into fuel (ethanol) adds to the pressure. 1/4 of the US grain production is used for our automobiles. 

There are things we can do to stop or reverse the trend towards the tipping point...thus the "Plan B", but Brown's plan is ambitious and here in the US I wonder if people are paying attention?  I recommend a search on YouTube for Lester Brown and is various lectures...the rabbit hole is deep and frightening.  There are sceptics, however Brown's logic is clear.  Here is the trailer for the film.  Pass it on:

Watch the full episode. See more Journey to Planet Earth.

Watch the full episode. See more Journey to Planet Earth.

Under the Covers of the WSJ List Top 10 "Clean Tech"

The Wall Street Journal published an article listing the top 10 Clean-Tech companies.  Names like Solyndra, Suniva, eSolar, & Recyclebank top the list.  The list is informative on who is doing what, but let's dig a bit deeper into the "industry" as a whole and look at the reality of some of these organizations.  As one person in the comments section pointed out,  the picture used in the article (see below) "that's the old Tehachapi Gorge site, and those wind turbines were abandoned YEARS ago."  Ooops.

 

So what was the criteria and how were these companies selected?  The WSJ goes on to explain the process:

 "...at the Journal's ECO:nomics Executive Conference in Santa Barbara, Calif., seeks to identify green companies with the greatest potential to succeed in an increasingly competitive sector....based on a strict set of criteria applied to 516 U.S.-based venture-backed businesses in clean technology....Candidates were analyzed on the amount of capital raised in the past three years; the track records of each company's founders, managers and investors; and the percentage change in its valuation in the 12 months ended Nov. 30."

Keeping the word POTENTIAL to succeed is very important here.  As another commenter points out, should we really consider a company like Solyndra, Inc. a success story because Obama gave them $535 MILLION? 

Ok..hold the phone.  Let's now bring this discussion to a more global, comparison.  I would be remiss if I didn't draw a parallel of US Government "intervention" grants into the clean-tech space to the recent Invetment Outlook Newsletter published by PIMCO's Bill Gross .  The Government is making big bets on these "potentially" successful Clean-Tech companies because it needs to show the world that we are trying to find solutions to oil dependency (among many other reasons).  While at the same time the Fed pumps freshly printed dollars into QE2 buying up Tresuries.  What happens when the money runs out in both situations?  Are many of these "clean tech" organizations going to end up like the Tehachapi Gorge site in the photo above without government stimulus?  We should all be very concerned on both fronts.  Libya an the rest of the middle east is on the brink driving oil prices through the roof putting an exclamation point on our dependence on foreign oil and Bill Gross's commentary on QE2 is on the money - who will buy the Treasuries?   

There are certainly Clean-Tech companies out there that have the potential to really have an impact on humanity, the economy, employment, the environment, etc... Here's to hoping that stimulus isn't the only way these companies survive.

ISES 2011 - International Student Energy Summit Promo Vid

The International Student Energy Summit (ISES) is a global forum that focuses on sustainable resource management and the role that students will play in defining the future of energy development. The International Student Energy Summit targets international, multidisciplinary post secondary students in undergraduate and graduate studies interested in energy. The first event occurred in 2009 in Calgary, Canada and created a network of driven individuals looking to make a difference in the energy sector. The next event will occur on June 9th, 2011 in Vancouver, Canada.


ISES 2011 Promo from VoVo Productions on Vimeo.