A small news item slipped by everyone unnoticed in the final days of the U.S. election, when attention was focused elsewhere. The highly respected International Energy Agency, a longtime sceptic of peak oil, has just released their annual World Energy Outlook -- and it is far grimmer than anything they have predicted so far.
An early report of the long-awaited study, leaked by Britain ’s Financial Times newspaper, stated that if new oil fields do not come online soon, world oil supplies will drop at a rate of 9.1 percent per year. And while the numbers for the full report are less steep, they still predict that:
we estimate that the average observed decline rate worldwide is 6.7%. Were that rate applied to 2007 crude oil production the annual loss of output would be 4.7mmbpd.
A good analysis of the report can be found at the Oil Drum, here, and here.
If that doesn’t sound like much, keep in mind how exponential growth works. When you see a straight line on a graph, it is usually arithmetic growth – 2, 3, 4, 5. Do this fifty times and you get 50. A curved line on a graph is more likely to be geometric, or exponential, growth – 2, 4, 8, 16. Do this 50 times and you get 1.1 quadrillion, or more than one million million.
As Dr. Albert Bartlett of the University of Colorado puts it, people often misunderstand exponential growth. If a headline read that crime was increasing at a rate of seven percent per year, most people would not be alarmed – seven percent sounds very modest. If the same headline said crime had doubled in the last ten years, people would feel in danger. Yet seven percent per year means doubling every ten years.
Exponential growth is behind most of our global problems. Burning fossil fuels would not be much of a problem if we had stopped at 1930s levels, but our consumption has increased exponentially, sweeping upwards on the graph. Climate change would not be an issue if our emissions had stabilized early, or our population, or any other issue. But all these are increasing exponentially, so we have shut out the possibility of slipping casually into a better world.
The same is true of reductions. A drop of 6.7 percent per year is a loss of 30 percent of world liquid fuel in five years. The effect on the economy is likely to be far greater, for energy is the real basis for wealth, and all the stock options, derivatives and alphabet soup of arcane alchemy are pure abstraction. I don't mean they won't have real effects -- we are trying to get a mortgage right now -- but we understand that most of what we calll "the economy" is a large head of froth, balanced delicately on the "beer" -- the energy supply. The recent shocks have all been blobs of foam disappearing from the world's financial computers, as everyone comes to realize how little of it was ever real. If the small supply of real wealth were to fall, the effects would be much greater.
Let's say the number again: 30 percent in five years. The last 25 percent drop was the Great Depression.
If this is true, it means we need to make our homes, our towns and our island much more self-reliant, and fast. It might be a good idea to stock up a few months’ supply of food, or fill old plastic bottles with water and keep them for emergencies. We as a country would be well-advised to restore local factories that would make essential goods like shoes, clothes and medical equipment. We need wind, solar power and other types of clean energy. We need electric rails powered by wind and solar, or we might not have transportation.
If we want to preserve the massive amounts of human knowledge that has been created on the Internet, we need to have solar-and-wind –powered server farms, and plans in place to run emergency Internet outlets in each small town.
Of course, even this urgent report is not as dire as most of the prophets of the peak oil movement, who have been right so far. The IEA report, based on excerpts, seem to think that we will make up some of the difference by developing existing fields, and perhaps we will. But that would only give us a less-steep exponential downward curve.
It is also possible that all of this is overblown, but so far the Greens have been right about everything -- and if you are ready for an emergency and there is none, what have you lost? Better to be prepared in case things go south -- as they will at some point.
As I said at the end of my speech in Kildare, let us try to live our lives like the firefighters I sometimes see relaxing on the station lawn; savouring the day, but prepared for an emergency.