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A Negabarrel Saved is a Barrel EarnedAmory Lovins shuttles around the world carrying a small suitcase that contains, he says, the equivalent of 200 large power plants plus all the oil that runs through the trans-Alaska pipeline. What it really contains is energy-saving lightbulbs, motors, showerheads, and other devices. They help Amory get across the most basic points about energy, namely:
1). No one WANTS energy. No one is pining to have a kilowatt-hour of electricity or a barrel of oil for its own sake. What people want are energy SERVICES: hot showers, cold beer, the ability to travel at reasonable speed and in relative comfort.
2). Energy is not a benefit, but a COST of getting energy services. The less energy we have to spend to heat the shower or cool the beer, the better off we are.
These are simple enough points, but the policy of nearly every country ignores them. Nations pride themselves on energy production, not energy efficiency. They search the wilderness for oil, pump it from the bowels of the earth, fight wars over it, invest billions in electricity plants. Oil companies and electric utilities think of themselves as selling energy, rather than selling energy services at the lowest possible cost.
Amory and his colleagues at Rocky Mountain Institute are trying to get across the idea that more efficiency can produce the same results as more energy, for less money, with less environmental damage. If we can turn a motor, light a bulb, or cool a room with fewer watts or barrels, that's just as good as discovering new barrels -- better, actually, because a discovered barrel can be burned only once, while an insulated house or more efficient car goes on saving barrels over its whole lifetime.
As Amory puts it: "In the lower 49 states are two supergiant oilfields, each bigger than the largest in Saudi Arabia; each able to produce sustainably (not just to extract once) almost 5 million barrels per day for less than seven dollars a barrel; each capable of ELIMINATING U.S. oil imports before a new synfuel plant or power plant or frontier oilfield could produce any energy whatever, and at about a tenth of its cost. They are the 'accelerated-scrappage-of-gas-guzzlers oilfield' under Detroit and the 'weatherization oilfield' in the nation's attics."
Energy efficiency is the cheapest option. Some smart investors are recognizing that. Despite national policies that subsidize supply rather than efficiency, the U. S. now uses 38 percent less oil to produce a dollar of GNP than it did in 1973. The 1973-86 improvement in the car fleet mileage (from 13.3 to 18.3 miles per gallon) saved in 1986 more than twice as much oil as we imported from the Persian Gulf that year. From 1979-86 the U.S. got fifteen times as much new energy from savings as from increases in nuclear plants and fossil fuels. And we have just begun to tap the possibilities for efficiency.
Graeme wrote:What's Behind Rising Gas Prices?Last November, the United Nations declared that Iran was clearly developing nuclear-weapons capabilities.
...a world oil market... with no more than 2.5 million barrels of spare capacity.
The net increase in average US crude oil production in 2010 was 0.1 mbpd, or about 170 bpd per drilling rig.
The net increase in average US crude oil production in 2011 was 0.1 mbpd (through, October). If this number holds, the net increase per drilling rig would be about 100 bpd per rig.
kublikhan wrote:I think the US should invest in negabarrels. Best return on investment.
Not if the cost of the energy is rising too. We are facing a supply side squeeze which is causing prices to rise. If efficiency gains increase so much that they overwhelm the supply side squeeze and cause prices to fall, you can compensate by levying energy taxes, like what happened in Europe.Kristen wrote:Doesn't more efficiency mean more consumption?
Of course you don't want to turn every power consumer into a power producer. The grid can produce power more cheaply and efficiently with a few large power generators than consumers can with millions of independent generators. The situation you describe is not an increase in efficiency, it's a decrease of efficiency.AgentR11 wrote:There is a problem that I just personally had to deal with related to this. And that is, if you invest in efficiency, but neglect the grid and supply, such that periods of unavailability occur; huge gains in efficiency are rendered moot as investment instantly gets rerouted to ways to prevent the unavailability at the end node. Case in point; we're shutting down a bunch of coal fired generation plants in Texas; but NG plants have not been built to replace that load. This has lead to warnings about rolling blackouts.
The likelihood of rolling blackouts forced my hand on a good sized generator purchase. The generator itself represents more energy in its construction, than'll I'll ever save from the new energy efficient central air and laundry put in. Its emissions are far worse, and waste a far more precious fuel (gasoline as opposed to NG/Coal); not to mention a much lower efficiency in producing the electricity itself; simply because the grid will come up slightly short, because investments in supply were not made.
If you don't do both; all the gains in efficiency can be wiped out in just a sequence of miscalculations. Do we really want neighborhoods with every house depending on its own generator for power?
Since around October last year, the price of crude oil on world futures markets has exploded. Different people have different explanations. The most common one is the belief in financial markets that a war between either Israel and Iran or the USA and Iran or all three is imminent. Another camp argues that the price is rising unavoidably because the world has passed what they call “Peak Oil”—the point on an imaginary Gaussian Bell Curve (see graph above) at which half of all world known oil reserves have been depleted and the remaining oil will decline in quantity at an accelerating pace with rising price.
Both the war danger and peak oil explanations are off base. As in the astronomic price run-up in the Summer of 2008 when oil in futures markets briefly hit $147 a barrel, oil today is rising because of the speculative pressure on oil futures markets from hedge funds and major banks such as Citigroup, JP Morgan Chase and most notably, Goldman Sachs, the bank always present when there are big bucks to be won for little effort betting on a sure thing. They’re getting a generous assist from the US Government agency entrusted with regulating financial derivatives, the Commodity Futures Trading Corporation (CFTC).
Since the beginning of October 2011, some six months ago, the price of Brent Crude Oil Futures on the ICE Futures exchange has risen from just below $100 a barrel to over $126 per barrel, a rise of more than 25%. Back in 2009 oil was $30.
Yet demand for crude oil worldwide is not rising, but rather is declining in the same period. The International Energy Agency (IEA) reports that the world oil supply rose by 1.3 million barrels a day in the last three months of 2011 while world demand increased by just over half that during that same time period.Gasoline usage is down in the US by 8%, Europe by 22% and even in China. Recession across much of the European Union, a deepening recession/depression in the United States and slowdown in Japan have reduced global oil demand while new discoveries are coming online daily and countries like Iraq are increasing supply after years of war. A brief spike in China’s oil purchases in January and February had to do with a decision last December to build their Strategic Petroleum Reserve and is expected to return to more normal import levels by the end of this month.
Why then the huge spike in oil prices?
Playing with ‘paper oil’
Wrong wrong wrong. worldwide oil demand is not declining. worldwide oil demand is rising. I don't understand why people would post facts that are easily proven false.Yet demand for crude oil worldwide is not rising, but rather is declining in the same period. The International Energy Agency (IEA) reports that the world oil supply rose by 1.3 million barrels a day in the last three months of 2011 while world demand increased by just over half that during that same time period.Gasoline usage is down in the US by 8%, Europe by 22% and even in China. Recession across much of the European Union, a deepening recession/depression in the United States and slowdown in Japan have reduced global oil demand while new discoveries are coming online daily and countries like Iraq are increasing supply after years of war. A brief spike in China’s oil purchases in January and February had to do with a decision last December to build their Strategic Petroleum Reserve and is expected to return to more normal import levels by the end of this month.
Crude Realities And The Price Of OilCrude oil prices remain elevated because of a tight supply-demand balance. Let’s look at the supply and demand sides of the equation.
Some investors still ask me why oil prices remain high even though demand is weak. This question assumes that sluggish growth in the US and other developed economies necessarily vitiates oil demand.
In 2010 the world consumed about 88.2 million barrels of oil per day--2.7 million barrels per day more than in 2009. Whether you look at the incremental increase in demand or the percentage gain, oil demand in 2010 increased at the second-fastest pace in 30 years. Much of this rebound stemmed from the snap-back in consumption that followed the severe 2008-09 recession. But the magnitude of this recovery took many analysts and industry participants by surprise.
Investors should also remember that although US oil demand remains well under its 2004-05 high, global oil demand hit a new peak in 2010. Demand growth in 2011 won’t match up with last year’s resurgence. However, the International Energy Agency’s (IEA) forecast still calls for global oil demand to grow by more than 1 million barrels per day to 89.3 million barrels per day. This uptick in consumption hardly qualifies as weak; oil demand has grown at an average annual rate of 1.05 million barrels per day since 1990.
IEA Says Asia To Drive Oil Demand Growth In 2012Asia is expected to dominate global oil-demand growth in 2012 due to more resilient regional economies and strong imports by China, the International Energy Agency said Wednesday in its monthly oil markets report.
Global oil demand in 2012 is expected to grow by 800,000 barrels to 89.9 million barrels a day, with Asian countries contributing 700,000 barrels to this expansion, the IEA said. Chinese-demand growth is forecast to accelerate through 2012, as the economic outlook is expected to improve as the year progresses," the IEA said.
IEA: ‘Cheap oil is over’ as demand approaches new recordIt’s perhaps with this in mind that the IEA’s chief economist Fatih Birol (pictured, above) has been repeating the phrase the era of cheap oil is over at numerous interviews recently. He told German TV on August 10 that:
“The era of cheap oil is over. Each barrel oil that will come to market in the future will be much more difficult to produce and therefore more expensive. We all - governments, industry and consumers - should carefully choose the type of car we want to buy in the future and should be prepared for oil prices being much higher than several years ago.”
basil_hayden wrote:18 previous posts of basically complete malarky.
Gasoline prices are rising because crude refined in the US is shipped out of country to those who will pay the price, driving up the US gasoline prices. Capitalism, Period.
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