22 Aug 2006
Notes from my recent talk at the Leading the Way conference, Dartington.
*Earlier in the year I spoke at the Leading the Way conference at Dartington which was organised by the Totnes Sustainability Group, and which launched DARE’s report on renewable energy for the South Hams. It was well received, and I was recently sent a transcript of some quite detailed notes of my talk taken by Dr. Carol Wellwood. I thought you might find it interesting, so here it is. It begins with the Chairman’s (David Radford) introduction… You can also download the Powerpoint presentation I used here and use it to accompany the notes below.*
“David Radford then introduced Rob Hopkins, founding director of the Hollies Centre for Practical Sustainability in Ireland, where he’s lived and worked for the last ten years; as a Permaculture teacher, he has lectured and taught widely and set up the first two-year full-time Permaculture course in the world at Kinsale Further Education College; in his last year there, he developed a process called Energy Descent Action Planning which looks at how settlements can collectively design strategies for making the transition beyond Peak Oil. The Kinsale Energy Descent Plan has gone all around the world and inspired many similar initiatives; Rob is now researching a Ph.D. at Plymouth University on designing the transition to life beyond oil and developing an energy descent planning process for Totnes and Devon.
Rob talked about Peak Oil, described as climate change’s twin sister, as they are two parts of the same problem. He pointed out that we live in an extraordinary time, when as ‘energy emperors’, we have access to cheap oil and energy equivalent to about 40 slaves working for each of us, and we’ve got very used to it. Each tank-full of petrol for our cars is about a year’s worth of manual labour. Having cycled up to the conference, he thought that if someone paid him to cycle them up the particularly steep hill just before the hall in a rickshaw, he would charge a lot more than the 5 pence worth of oil that his car would have used!
He said that we don’t necessarily see the perspective of the Petroleum Interval, the results of which Sheila talked about, because it encompasses our lifetimes. It has been a minor blip or aberration and we are fortunate to be living at the peak, able to do more, see further and have more options than anybody in history has ever had. Rob hoped to distil the essence of Peak Oil in ten minutes, despite it being quite complicated, and then look at some of his work on trying to look beyond it.
He used to think that oil in the economy worked like petrol in a car, in that the car runs exactly the same on a completely full or almost empty tank. The theory of Peak Oil is that the pivotal point comes when we’ve used up half the resource. The idea originated in the 1950s with M. King Hubbard, an American geologist who worked for Shell. His prediction, at a big conference in 1956, that US oil production would peak in 1970, was thought completely mad. In 1970, more oil was produced than ever before, but by 1972, he was proved right. The term energy descent refers to the downward half of the oil curve, after the peak. We’ve had energy ascent since the industrial revolution and we’re now looking at the process of energy descent, which is how we get from the top down to the bottom again. Lots of people are writing about the peak but there’s not much work on managing this descent in a productive, positive way.
There are two ways that people calculate when the peak might be. Colin Campbell, of the Association of Study of Peak Oil, took the world’s total endowment of oil, calculated as 2 trillion barrels, and the amount we have produced so far, roughly half the total. The important feature of the peak is that, during energy ascent, demand has driven supply, meaning six billion people have been calling the shots; once we start descent, supply will control demand, leaving about six people in command. The price will start to rise exponentially. The other way of working out the peak is done by Petroleum Review magazine, who look at all the upcoming projects in terms of oil production, as oil projects take a long time to get onstream, and they calculate 2007-2008 as when we hit the peak.
The figures provided by the oil companies are profoundly unreliable. In the 1980s all the OPEC countries miraculously doubled their oil reserves overnight, without proof. This happened to coincide with new OPEC regulations, stipulating that the greater the oil reserves, the more a country was allowed to pump out and the more money they could generate.
Rob provided a few indicators that we are at or very, very close to the peak. The International Energy Agency’s figures show that world oil production has not increased since 2004. The average daily production of most OPEC countries is in decline. Venezuela recently announced that it had to import 100,000 barrels of oil a day from Russia in order to fulfil contractual obligations. The key state is Saudi Arabia, called the swing producer because it can pump a bit more oil out whenever world needs it. After Hurricane Katrina it was unable to do so and it is clear that it has much less oil than stated.
A graph from the Energy Information Administration, the US government’s energy advice organisation, showed that Saudi Arabian production has levelled out and is already in decline. All major oil companies are also in decline, apart from BP who recently bought a Russian oil company, which improved their figures. Oil prices are very volatile, hitting a record of $75 a barrel in April, and any big shock could start prices rising very, very sharply. Despite great efforts being made to discover fresh oil, they’re not finding any. The magazine World Oil said that 2005 was the poorest year for exploration success in both oil and gas since World War II, despite record amounts of funds being ploughed into exploration, production and capital spending.
The UK’s problem may well turn out to be peak gas; we scraped through by the skin of our teeth this winter, when the Russians shut off supplies to the Ukraine and the natural gas from the North Sea was depleting far, far quicker than was thought.
Tony Blair tried to buy gas from Europe unsuccessfully, even though we were prepared to pay far more than anybody else, so he accused Europe of protectionism. When the Russian company Gazprom tried to buy the British gas company Centrica, he vetoed it, in the name of protectionism. Newspapers argued at the time that we need to diversify our sources of gas from but very few mentioned that maybe we should be using less. Apart from Russia, we can get a lot of gas from the Caspian Sea (Azerbaijan) and Iran, which is rather interesting in the light of international geopolitics.
So what do the oil companies have to say about this? Lord Browne, of BP, claims we have 30 years of oil left and therefore the world isn’t running out, which is true, but what is left is very hard and expensive to extract, like tar sands, where you probably have to use more energy extract the oil than it would yield. Chevron ran a series of adverts last summer, basically saying, “We’ve peaked. Any suggestions?