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Peak What?/ The Future is Electric.

Discussions about the economic and financial ramifications of PEAK OIL

Peak What?/ The Future is Electric.

Unread postby SeaGypsy » Wed 16 May 2012, 09:40:26

Forget peak oil. The world has gone to war against it with the only weapons it has/ printing presses and filling energy quotas by any and all means necessary. This means climate change can go chew it's grit or be used as a funding platform, but will not control policy. The war between the climatologists and the economists is still dragging but with one inevitable result:

All the black sh#t will be dug out and burned.

So, why is this in economics and finance?

Because we are none of us, going to live long enough to see the end of the printing press or these:

Image

So what is going to happen besides?

Everything to do with electricity.

Copper. Coal. Shale. The stuff which is cheap now, we won't be able to (or willing to) do without. How FUBAR are we?Forget 'Drill Baby Drill' it's going to be 'Dig it and Frack it 'til ya just cain't Dig an' Frack no mo'"
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Re: Peak What?/ The Future is Electric.

Unread postby Timo » Wed 16 May 2012, 10:10:43

Those calls will continue, but the bright side of me still has just a little bit of faith in humanity, who might just come to realize that BAU is not worth its downsides from an environmental standpoint, and perhaps more importantly, from an economic standpoint. Eventually, the costs of renewables will be less than the costs of oil, coal, and gas, and even if we have to scale back our way of living, slightly, we'll do it because its cheaper to do so. That's the optimist in me talking. The pessimist in me says that regardless of which way we go, it won't have any effect on the livability of the planet. That seems to be on a downward trend, no matter what we humans do.
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Re: Peak What?/ The Future is Electric.

Unread postby SeaGypsy » Wed 16 May 2012, 10:41:35

BAU? Something quite novel by comparison. Do you mean you believe humanity will choose rapture by mass starvation over a concept of ecology? I doubt it, very much. We may eventually have a whole new economic plateau, a neo-eco- renaissance society may develop, but in the process, the vast majority of cheap and portable energy will be extracted. We are talking now of 'BAU in Transition' outliving all of us alive now, to the point where the reality of long term no-return climate change shows our great grandchildren our legacy.
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Re: Peak What?/ The Future is Electric.

Unread postby pstarr » Wed 16 May 2012, 11:05:18

I know it gets frustrating waiting for the ball to drop (even knowing the ball will be a wrecking ball) but the basic facts have not changed.

There is no way in hell that electricity from coal, nuclear, renewables, or unobtainium will power this industrial civilization. Our real world (pointless traffic jams, long-distance cargo shipments, resource extraction of all kinds, and especially food production) was built on a free-flowing, inexpensive, convenient liquid petroleum that is readily piped, stored, refined, distributed, and run around town like a cheap trick on a line of meth. You might carpool, ride share, even bike to the shopping mall. But out in the real world the fences will not be mended, the timber replanted, the beets harvested, the wells drilled with a plug-in Prius. Sorry. :?

You gotta have a geologic perspective to make sense of this peak oil thing. It took 150 years for peak oil production. During that time everything changed. Everything. There is no going forward. Only down. This is it. In slow motion.
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Re: Peak What?/ The Future is Electric.

Unread postby Plantagenet » Wed 16 May 2012, 11:29:19

pstarr wrote:There is no way in hell that electricity from coal, nuclear, renewables, or unobtainium will power this industrial civilization.
.....You gotta have a geologic perspective to make sense of this peak oil thing. It took 150 years for peak oil production. During that time everything changed. Everything. There is no going forward. Only down. This is it. In slow motion.


You left out Natural Gas.

Its time to face facts. Back here in the real world what is going on in the US is a switch from generating electricity from "coal, nuclear, renewables, or unobtainium" to generating electricity from NG-----there was a ca. 20% increase in the use of NG in just one year across the USA.

Yes, Oil is going down. Oil production peaked in 2005. The oil-based economy is going down.

But NG is going up and going up fast. Frakking has flooded the market with NG in the US, and China and Poland are beginning to frak their shales too.

Why ignore reality? NG is a huge energy story in the post-peak oil world.. 8)
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Re: Peak What?/ The Future is Electric.

Unread postby Timo » Wed 16 May 2012, 11:57:44

Demand for NG, and the electricity it might generate, is simply too steep for its long-term ability to sustain. Yes, it is greatly reducing the use of coal and oil for a multitude of applications, but given what i've read here at PO (most of which i think i can trust), the actual lifespan of a frakked gas well is not all that long, and the production capacity of frakked wells goes down very fast. I'm simply comparing global demand against the thus-far proven production records of NG. NG may very well be the fuel of choice for the next decade, or maybe two decades, but i doubt its "the" answer for our needs, much longer than that. If we have technological alternatives that are more sustainable, cleaner, and more plentiful, those should be the ultimate objective to develop and implement. One fossil fuel in place of another isn't really thinking outside the box, and doesn't really advance the human condition on this planet. It just kicks the inevitable transition a bit further down the road.
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Re: Peak What?/ The Future is Electric.

Unread postby Lore » Wed 16 May 2012, 12:19:58

Timo wrote:Demand for NG, and the electricity it might generate, is simply too steep for its long-term ability to sustain. Yes, it is greatly reducing the use of coal and oil for a multitude of applications, but given what i've read here at PO (most of which i think i can trust), the actual lifespan of a frakked gas well is not all that long, and the production capacity of frakked wells goes down very fast. I'm simply comparing global demand against the thus-far proven production records of NG. NG may very well be the fuel of choice for the next decade, or maybe two decades, but i doubt its "the" answer for our needs, much longer than that. If we have technological alternatives that are more sustainable, cleaner, and more plentiful, those should be the ultimate objective to develop and implement. One fossil fuel in place of another isn't really thinking outside the box, and doesn't really advance the human condition on this planet. It just kicks the inevitable transition a bit further down the road.


Good summation, NG is not a game changer, just another game delayer. We will never build out the infrastructure to utilize what will end up being a very untenable energy resource.
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Re: Peak What?/ The Future is Electric.

Unread postby Plantagenet » Wed 16 May 2012, 12:35:55

Lore wrote: We will never build out the infrastructure to utilize what will end up being a very untenable energy resource.


??

Electric companies don't have to build out new infrastructure to use NG. They simply retrofit their existing powerplants to burn NG instead of coal. Its a relatively simple process.

Power plants across the US are converting from coal to NG right now. Thats why coal dropped by over 20% and NG use in US electric power plants went up over 20%-----in just the last year. :idea:
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Re: Peak What?/ The Future is Electric.

Unread postby pstarr » Wed 16 May 2012, 14:12:35

?? and I raise you ????

I have repeatedly challenged you to give evidence of substantial fleet conversions to either NG or electric vehicles in the face of high crude and low NG prices. Got anything yet?
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Re: Peak What?/ The Future is Electric.

Unread postby Lore » Wed 16 May 2012, 14:37:53

Plantagenet wrote:
Lore wrote: We will never build out the infrastructure to utilize what will end up being a very untenable energy resource.


??

Electric companies don't have to build out new infrastructure to use NG. They simply retrofit their existing powerplants to burn NG instead of coal. Its a relatively simple process.

Power plants across the US are converting from coal to NG right now. Thats why coal dropped by over 20% and NG use in US electric power plants went up over 20%-----in just the last year. :idea:


Great use as an alternative to coal for electrical generation, as a replacement to oil for transportation, not so much.
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Re: Peak What?/ The Future is Electric.

Unread postby Pops » Wed 16 May 2012, 15:06:59

Natural gas is really cheap, half what it was a couple of years ago, so the value of reserves will need to be restated – down of course.

With less reserves on the books (fewer assets) and returns from existing wells down (less cashflow) and continuing questions as to the profitability of fracking considering the steep depletion rate, AND finally, downgraded credit exactly when the ongoing need for credit to continuously drill new holes just to keep production flat... I'd not put an end to the story just yet.

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Re: Peak What?/ The Future is Electric.

Unread postby SeaGypsy » Wed 16 May 2012, 15:22:51

Which alludes to the backbone of my argument. There is an abundance of coal and gas, oil is evermore expensive, nukes are to unpopular. There being plenty of such fossil fuels, in such diversity of utility, an electric based conversion is all but inevitable in the global system. The only alternative is to have pockets of localized specialized energy and transport infrastructure region by region; which runs against the grain of globalism.
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Re: Peak What?/ The Future is Electric.

Unread postby pstarr » Wed 16 May 2012, 15:27:30

Pops wrote:Natural gas is really cheap, half what it was a couple of years ago, so the value of reserves will need to be restated – down of course.

With less reserves on the books (fewer assets) and returns from existing wells down (less cashflow) and continuing questions as to the profitability of fracking considering the steep depletion rate, AND finally, downgraded credit exactly when the ongoing need for credit to continuously drill new holes just to keep production flat... I'd not put an end to the story just yet.

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Comphrensive analysis. I'd say the fracting bubble has, or is about to burst.
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Re: Peak What?/ The Future is Electric.

Unread postby pstarr » Wed 16 May 2012, 15:36:51

SeaGypsy wrote:Which alludes to the backbone of my argument. There is an abundance of coal and gas, oil is evermore expensive, nukes are to unpopular. There being plenty of such fossil fuels, in such diversity of utility, an electric based conversion is all but inevitable in the global system. The only alternative is to have pockets of localized specialized energy and transport infrastructure region by region; which runs against the grain of globalism.
You seem to have contradictory ideas here. The best we can hope for is a decentralized national/regional system of local agriculture and simpler industry . . . if an intact heavy (oil-based) transport system can still get to mines, farm fields, etc. But your contention that a global system will electrify seems highly doubtful. Resources and consumer products move by ocean ship (bunker oil), truck (diesel), and freight train (also diesel). I really don't see how globalism can survive peak oil. At all.
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Re: Peak What?/ The Future is Electric.

Unread postby SeaGypsy » Wed 16 May 2012, 15:53:15

You need to borrow my spectacles P 8) I'm not advocating anything, joining Graeme's or Oily's or Memoe's cheer squads, any of that. Just stating what I see. I think MD has been way ahead of us here on this, if a bit coy about it.

I doubt transition is going to be unaccompanied by disaster for many folks in many places, the geo-political ramifications of peak oil are not to be dismissed at all.

Globalism will continue for as long as humans are around, in some form.

Running international shipping and communications is relatively the cheapest part of the essential infrastructure thereof, and the types/ amounts of fuel required highly flexible. Mass air transit will die relatively soon. Shipping, there is no real limit.
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Re: Peak What?/ The Future is Electric.

Unread postby Plantagenet » Wed 16 May 2012, 16:36:57

pstarr wrote: Resources and consumer products move by ocean ship (bunker oil), truck (diesel), and freight train (also diesel). I really don't see how globalism can survive peak oil. At all.


Your idea that the world is going to collapse due to peak oil presupposes that humans won't make adjustments or re-engineer parts of the transportation grid to run on alternative fuels.

But each of your three examples of things that will stop working due to peak oil can easily be converted to run on natural gas and/or electricity.

(1) freight train (also diesel) Its a simple matter to electrify trains. The European train system already is electric, not diesel. No problemo.

(2) truck (diesel) We can convert interstate trucking entirely to NG. Some US trucking companies are ALREADY converting their fleets to NG. T Boone Pickens and his business partners are already building NG gas stations along interstates as part of the "Pickens Plan" Check it out.

3. ocean ship (bunker oil) Its just starting to happen right now. Norway is already converting some of its coastal fleet to NG and Japan is developing natural gas powered ocean ships

Peak Oil doesn't mean that alternative fuels won't be used----in fact its MORE likely that we'll convert to alternative fuels like NG and electricty because of peak oil. 8)

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Re: Peak What?/ The Future is Electric.

Unread postby Shaved Monkey » Wed 16 May 2012, 17:35:35

Plantagenet wrote:Your idea that the world is going to collapse due to peak oil presupposes that humans won't make adjustments or re-engineer parts of the transportation grid to run on alternative fuels.

But each of your three examples of things that will stop working due to peak oil can easily be converted to run on natural gas and/or electricity.

For your theory to work it presupposes that there will be an economy and alternate resources available to do this for the long term.
For BAU you need consumers with jobs and money and resources to make crap out off to sell to them.
Most crap is made from plastic or has a fair element in it....plastic is made from cheap oil.
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Re: Peak What?/ The Future is Electric.

Unread postby SeaGypsy » Wed 16 May 2012, 18:05:19

Plastic is particularly abundant in sludge/ tar oil, at the heavy and plentiful end of the spectrum. The stuff running out first is the light and sweet, which has very little to do with plastics. Jet fuel/ kerosene and the lighter gases used in industry, such as Helium, are perilously close to terminal decline. But lack of ability to hop around the planet quickly and cheaply is hardly the end of the world. There is still a lot of innovation in industrial applications of rare earths and recycling metals and gases.
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Re: Peak What?/ The Future is Electric.

Unread postby dissident » Wed 16 May 2012, 18:46:39

No accounting for greenhouse gas effects in this burn all accessible fossil fuels scenario. We can't isolate agriculture from the weather. I am sure there will be increasingly rabid attempts to pretend that AGW is a commie hoax, but by 2030 it will be clear where we are headed.
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Re: Peak What?/ The Future is Electric.

Unread postby pstarr » Wed 16 May 2012, 18:53:57

Plantagenet wrote:
pstarr wrote: Resources and consumer products move by ocean ship (bunker oil), truck (diesel), and freight train (also diesel). I really don't see how globalism can survive peak oil. At all.


Your idea that the world is going to collapse due to peak oil presupposes that humans won't make adjustments or re-engineer parts of the transportation grid to run on alternative fuels.
I guess it depends on your definition of "collapse. I am looking at "Never-Ending Economic Depression" as a reasonable definition. Pretty much assured without constant primary-energy production growth. Because our financial system (from the Federal Reserve, through commercial and retail banking, loans, business investment, personal inheritance, etc.) and normal global population growth all depend on an ever-increasing economic pie. That pie is shrinking because oil is shrinking.

Plantagenet wrote:But each of your three examples of things that will stop working due to peak oil can easily be converted to run on natural gas and/or electricity.
Easily? That's laughable.

Plantagenet wrote:(1) freight train (also diesel) Its a simple matter to electrify trains. The European train system already is electric, not diesel. No problemo.
The European mass-transit was established about a century ago, just about the same time we ripped ours out. Our will not be replaced because of Republican hatred for public transport . . . and trains in particular. What would your plan look like? Privatize the Rocky Mountains? Give Boone the prairies? Only Big Government fix this, and Big Government will NEVER BE GIVEN THAT MANDATE. But you know that, right?

Plantagenet wrote:(2) truck (diesel) We can convert interstate trucking entirely to NG. Some US trucking companies are ALREADY converting their fleets to NG. T Boone Pickens and his business partners are already building NG gas stations along interstates as part of the "Pickens Plan" Check it out.
Trucks run on diesel and can not be converted to NG. Besides a thousand miles of Rt 80 (the main trucking interstate for delivery of food and services to the East Coast) is without natural gas (or sufficient electricity for that matter) to power anything other than diesel. It would cost a trillions of dollars to electrify or NG our transport infrastructure.

Pickens is a self-promoting rich guy who got guilty and now feels obligated to greenwash his life. Good luck with that.

Plantagenet wrote:3. ocean ship (bunker oil) Its just starting to happen right now. Norway is already converting some of its coastal fleet to NG and Japan is developing natural gas powered ocean ships
Right plant. Sure.

Plantagenet wrote:Peak Oil doesn't mean that alternative fuels won't be used----in fact its MORE likely that we'll convert to alternative fuels like NG and electricty because of peak oil. 8)
dream on dude. you sound like a hippie dippie now, and not a good hard-assed republican realist.
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