Peak Oil and Alternative Energy

Article excerpt

The world is beginning to wake up to the fact that peak oil is real. Various financial institutions, as well as oil companies, independent geologists, the U.S. Army Corps of Engineers and a range of corporations eager to cash in on alternative energy sources have stressed its importance. Sweden and Norway have both initiated plans to be essentially free of fossil fuels by 2020, and a small number of municipalities are beginning to incorporate energy consumption and production into their core planning activities. In other words, plans are already underway to prepare for an energy future that no longer relies on cheap energy.

Peak oil, of course, does not mean the world is about to run out of oil, but only that we are about to reach the level of maximum production of conventional oil--the halfway point, so to speak. The implications of this geological fact are profound precisely because conventional oil is such a unique resource, and because we rely so heavily on it to fuel not only our transportation services globally, but our economy, as well.

The Advantages of Conventional Oil

What is so unique about conventional oil is that it has such a high energy content and is relatively easy to extract from the ground. In addition, oil is easily transported at ambient temperatures, and is relatively safe to handle. It also has many other uses besides producing energy--plastics, pesticides and fertilizers, and pharmaceuticals.

For all its unique properties, the feature of conventional oil that is most important is its high net energy--the amount of useable energy left to do work after we subtract the energy we put into extracting and processing it. And this is the crunch issue when we look for alternatives to conventional oil.

Conventional oil is a geological deposit of fossil remains that is mixed with natural gas. Once a hole is drilled to reach it, the gas helps push the oil out of the ground, where it can be collected and processed for use as a fuel. As a well is depleted, however, the gas is also diminished. At a certain point, it is no longer able to push the remaining oil out of the ground. The engineering solution to this phenomenon is to pump natural gas, carbon dioxide, or water back into the ground to force out the remaining oil. It works, but there is a cost--and the cost is not simply financial. It takes energy to pump water or gas into the well to extract more oil; consequently, the net energy (what is available to do later work) is lowered.

This reduction in net energy over time is a known characteristic of all conventional oil wells. We now know that individual wells, oil fields and, indeed, entire national oil reserves, exhibit this phenomenon. As the well or field matures, two things happen: the amount of oil that can be extracted from the source declines in volume, and it takes more energy to extract the remaining amounts.

Some two thirds of major oil-producing nations are known to have peaked--reached the half-way point of depleting their oil reserves. What is less well known is that, as this peaking of individual national oil reserves occurs, the net energy available from these sources also declines. The world ends up using more energy simply to extract more energy. Net energy from oil has declined from 100:1 early in the twentieth century, to less than 20:1 today; and it will continue to decline as more oil producing nations, especially that large producers in the Middle East, reach their peaks. When the global peak occurs, the amount of oil extracted will decline, and so will the net energy of that oil.

A New Meaning to "TINA": There is No Alternative to Conventional Oil

Maggie Thatcher's famous quote that "there is no alternative" to capitalism can also be applied to conventional oil. There is no alternative to conventional oil in terms of net energy, and it is net energy that drives the global economy.

COAL AND NATURAL GAS have net-energy ratios almost as high as conventional oil. …