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Why a Sense of Global Community is Needed to Survive the Coming World-wide Energy Crisis Peak oil, ecological carrying capacity, and the perilous phase.

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Presentation on theme: "Why a Sense of Global Community is Needed to Survive the Coming World-wide Energy Crisis Peak oil, ecological carrying capacity, and the perilous phase."— Presentation transcript:

1 Why a Sense of Global Community is Needed to Survive the Coming World-wide Energy Crisis Peak oil, ecological carrying capacity, and the perilous phase transition to renewable energy sources. Presentation at the LMU Bellarmine Forum, November 7, 2005 Dr. Michael Mills Psychology Department Loyola Marymount University BEFORE PRESENTATION: -- start windows media player -- get Oilstorm set up with it (in case it doesn’t work properly in PowerPoint?) -- download Sirenia clip so it is ready to go: pause it once it starts loading How many of you have heard of the term “peak oil”? When you do think oil will peak? Before I begin, let me warn you. If I do my job today, you will leave this lecture a bit shaken Don’t shoot me – I’m just the messenger!

2 Some bad news, and some good news, about our future…
The bad news (according to ecologists and population biologists): Thomas Malthus: The population of a species increases geometrically But the carrying capacity of the environment is finite, Populations fluctuate between geometic growth and sudden die-offs Our species may be no exception. Carrying capacity of earth for humans is maybe billion people (?) And we are already have over 6 billion people… The good news (according to “cornucopian technologists”): Ray Kurzweil: Scientific knowledge, like populations, grows geometrically too… May allow us solve problems of carrying capacity, cure disease and aging, Technology will help us overcome population overshoot and collapse. The outcome of the Malthusian / Kurzwilian “grudge match:” More than just an academic exercise One of the two scenarios will likely occur within your generation’s (college students’) lifetime.

3 Overview of Presentation
Part 1: The Coming Worldwide Energy Crisis The world is running out of cheap oil and other fossil fuels at a time when demand is increasing. Part A: Malthusian Perspective: Possible worldwide economic problems, societal collapses, wars, and even population die-offs. Part B: Kurzweilian Perspective: Technology will come to the rescue Part 2: Why a Sense of Global Community is Needed to Survive the Coming World-wide Energy Crisis Declining energy results in what game theorists call a “Negative-Sum Game” This condition creates greater risks for social conflict and war. How can people of the world cooperate to survive the energy crisis?

4 Part 1: The Coming Energy Crisis
Part A: The Malthusian Perspective QUESTION: HOW MANY PEOPLE HERE KNOW WHAT THE TERM “PEAK OIL” REFERS TO?

5 We have become “Oilcoholics.”
“Oil Storm” movie trailer: FX Channel movie: “Oil Storm” (June, 2005). Exemplifies our dangerous dependence on oil What would happen if our access to oil was interrupted? Set up: -- aired on the FX channel in June 2005 -- amazingly prophetic -- in the movie, hurricane “Julia” strikes New Orleans -- amazing similarities to the real hurricane Katrina Exemplifies that we knew New Orleans was below sea level, but we did not adequately prepare. It was simply a matter of time.

6 “Oil Storm” movie trailer:

7 Thomas Malthus An Essay on the Principle of Population
"It is an obvious truth, which has been taken notice of by many writers,  that population must always be kept down to the level of the means of subsistence; but no writer that the Author recollects has  inquired particularly into the means by which this level is effected..."   -- Thomas Malthus, 1798 An Essay on the Principle of Population More general problem: -- GEOMETRIC PROGRESSION of population’ “If there ever is a time of plenty, this very fact will automatically lead to an increase in the population until the natural state of starvation and misery is restored."      -- Richard Dawkins

8 Population in a Petri dish (from: http://321energy
Imagine the bacteria were light emitting. You would see the petri dish start to glow – rapidly glow brighter, and then quickly go dark. One important aspect of population studies can be quickly demonstrated by growing a bacterial or yeast culture. The hypothetical growth phase of a mammalian culture is shown in Figure 4 (excuse the CFU/mL (colony forming units/mL), should be cells/mL) for this example. The stationary phase is rather staggered, since the death phase usually occurs shortly after cells reach a peak density. Glucose is a commonly used nutrient by bacteria and it is present at a specified concentration upon culture inoculation. Reaching the stationary phase is a result of nutrient depletion. Glucose metabolism has many branch points, but one important part of the pathway is the conversion to lactate (waste product). Two lactate molecules are produced from one molecule of glucose. When glucose is totally consumed, lactate is often utilized by scavenging pathways for an energy source. This can be superimposed upon the current human population and why inflation is a more likely route than deflation in the coming 5-7 years. In mammalian, or bacterial cultures, growth occurs until energy demands do not balance the requirements for growth. Resources are squeezed until there is not enough and a population decline ensues. This can be translated easily into the current global climate where oil (glucose) is nearing depletion and alternatives such as uranium and oil sands (lactate) must be used to prevent the inevitable disruption in society.

9 The last minutes in the petri dish.
Geometric rates of increase in a finite world… Source: Dr. Albert Bartlett The last minutes in the petri dish. 11:54 a.m. 1/64 full (1.5%) 63/64 empty 11:55 a.m. 1/32 full (3%) 31/32 empty 11:56 a.m. 1/16 full (6%) 15/16 empty 11:57 a.m. 1/8  full (12%) 7/8   empty 11:58 a.m. 1/4  full (25%) 3/4   empty 11:59 a.m. 1/2  full (50%) 1/2   empty 12:00 noon full (100%) 0% empty Bacteria grow by division so that 1 bacterium becomes 2, the 2 divide to give 4, the 4 divide to give 8, etc.  Consider a hypothetical strain of bacteria for which this division time is 1 minute.  The number of bacteria thus grows exponentially with a doubling time of 1 minute.  One bacterium is put in a bottle at 11:00 a.m. and it is observed that the bottle is full of bacteria at 12:00 noon.  Here is a simple example of exponential growth in a finite environment.  This is mathematically identical to the case of the exponentially growing consumption of our finite resources of fossil fuels.  Keep this in mind as you ponder three questions about the bacteria:  When was the bottle half-full?  Answer: 11:59 a.m.!  (2) If you were an average bacterium in the bottle, at what time would you first realize that you were running out of space?  At 11:55 a.m., when the bottle is only 3 %  filled (1 / 32) and is 97 % open space (just yearning for development) would you perceive that there was a problem?" 

10 “The Introduction, Increase and Crash of Reindeer on St
“The Introduction, Increase and Crash of Reindeer on St. Matthew Island”, by David Klein 20 reindeer were introduced to St. Matthew Island in 1944 Lots to eat, no predators Population exploded By 1963, the density of the reindeer on the island had reached 47 per square mile They ate all the lichens (their food) on the island In 1963, there was a die-off – about 6,000 reindeer starved to death

11 “The Introduction, Increase and Crash of Humans on Easter Island…”
A few humans arrived about 400 A.D. Population exploded to as many as 20,000 They cut down trees to move the stone statues No trees = no boats, no top soil About 1700 AD – die off of up to 18,000 people due to starvation and cannibalism. “Easter Island is Earth writ small” – Jared Diamond

12 Imagine the world as a petri dish
-- analogy: petri dish  imagine organisms that gave off light. You would see the petri dish gradually (but exponentially) light up). But, then after it burned the brightest, it would suddenly go dark. End show with same photo from space. BASIC PROBLEM: --POPULATION GROWTH IS GEOMETRIC -- REVIEW THE COLORADO PROF’S LECT RE THE MATH (NEED SOME EXAMPLES – 11 – 12’ OCLOCK EXAMPLE, IF BATERIA DOUBLED THEIR THEIR POPOULATION EVERY MINUTE AND IF WE STARTED AT 11:00 AND THE PETRI DISH WOULD BE FULL AT 12:00 AT WHAT TIME WOULD BE PETRI DISH BE ½ FULL? 11:59

13 “The Introduction, Increase and Crash of Humans on Earth Island…”
The essential energy resource to support industrial/technological civilization: oil Sobering Fact: There is no energy-equivalent substitute for oil, in terms of its advantages of energy density, transportability, range, safety and cost. Also, oil is used to make fertilizer to grow food, and in many everyday products (plastics, etc.) Oil has unique advantages for transportation: Imagine trying to fly an airplane on a non-oil power source: Wood? Coal? Electricity? Nuclear? Hydrogen? Problem: like trees on Easter Island, oil is a finite resource. And, we are gradually running out… ISSUE ISN’T THAT WE ARE RUNNING OUT NOW, BUT THE AMOUNT WE CAN GET OUT OF THE GROUND IS decreaing WORLD oil demand keeps rising, some 1.5% to 2.5% per year. oil supplies will be decreasing about 3% per year. The result: slow, gradual energy aphixiation. Imagine you were in a room where the oxygen content was Very Gradually lowering… at first you wouldn’t notice much Of a difference… but gradually, you would become more uncomfortable.

14 Peak Oil Discoverer M. King Hubbert 1903-1989
Shell Oil Geologist / Petroleum Scientist Highly qualified and intellectually courageous In 1954 he predicted that U.S. oil would peak about 1970 Universally criticized at the time After 1970 he became highly respected In 1984 Hubbert predicted world peak oil in the early 2000s

15 PEAK OIL: When you plot the production of an aggregate of oil fields over time you get roughly a bell curve Top of the curve Mid point 1st half 2nd half

16 USA Oil Peaked in 1970 http://www.oilcrisis.com/de/lecture.html

17 Peaking Oil and Gas Iran peaked: 1974 Russia peaked: 1987
Saudi Arabia peak – 2005? In 2005 natural “gas production has peaked in North America," Exxon Chief Executive Lee Raymond (Reuters, June 21, 2005)

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20 Problem: -- “postiive” feedback loop of “net energy” -- more energy is required to get at the more difficult to extract oil. -- at some point, when the EROEI is 1 – then th Jean Laherr`ere, Estimates of Oil Reserves, paper presented at the EMF/IEA/IEW  meeting in Laxenburg, Austria, June 19,  http://www.iiasa.ac.at/Research/ECS/IEW2001/pdffiles/Papers/Laherrere-long.pdf

21 Crude oil production by the world's largest private oil companies is in decline as of first half of 2005.

22 Source: http://greatchange.org/dinosaurblood.html

23 How much time do we have left?

24 Another related problem: Oil Demand-Production Cross-Over
Oil demand now exceeds supply. New sources of increased oil demand: China and India Source:

25 Oil demand expected to double in 25 years, while oil reserves will be plummeting.
DOCUMENTARY "THE END OF SUBURBIA" SHOWING IN OTTAWA Demand for oil is increasing, but oil production is decreasing. The red portion represents demand short fall. Result: oil prices go through the roof starting in 2005… Exxon-Mobil Report, Oct. 2004

26 If this is such a serious problem, why haven’t we heard about it?
Time horizons: Business: Annual Profits Government: Next election (4 – 6 years) Media: Dramatic headlines of current events People in general: in ancestral environment, life span about 35 years -- discount future events over current events Denial? Nothing like this has ever happened before Or, if it has (1970s oil shocks), problem quickly reversed Jiminy Cricket syndrome – technology to the rescue! Loss Aversion – invested in current infrastructure Dislike the idea of change, especially, reducing consumption.

27 "How to Kick the Oil Habit"
But… the mass media (both fiction and non-fiction) is starting to catch on… "How to Kick the Oil Habit" Time Magazine, Oct. 23, 2005 "If this explosion of (renewable energy) innovation has a problem, however, it may be that the developments are coming too late to allow a smooth transition to the postpetroleum era."

28 Chevron TV ad. http://www.chevron.com/about/advertising/

29 Chevron TV ad.

30 Exxon Energy Video Source: http://exxonmobil

31 Video Clip (fiction): “Syrinia” movie trailer:
Those who control oil, control the world. Increasing international conflict (“resource wars”) over the remaining, dwindling oil supplies. To be released in December, 2005.

32 Non-Fiction Article: “Outcome Grim at Oil War Game -- Former Officials Fail to Prevent Recession in Mock Energy Crisis” By John Mintz, Washington Post Staff Writer Friday, June 24, 2005; Page A19 “The United States would be all but powerless to protect the American economy in the face of a catastrophic disruption of oil markets, high-level participants in a war game concluded yesterday.” “The exercise, called "Oil Shockwave" and played out in a Washington hotel ballroom, had real-life former top U.S. officials taking on the role of members of the president's Cabinet convening to respond to escalating energy crises, culminating in $5.32-a-gallon gasoline and a world wobbling into recession.” "The American people are going to pay a terrible price for not having had an energy strategy," said former CIA director Robert M. Gates, who took on the role of national security adviser. Stepping out of character, he added that "the scenarios portrayed were absolutely not alarmist; they're realistic."

33 Declining oil production & rising demand = ever rising gas prices
Rising gas prices (hypothetical): 2005: $2.60/gallon 2006: $3.25/gallon? 2007: $4.10/gallon? 2008: $5.95/gallon? 2009: $11.54/gallon? 2010: $16.82/gallon? 2015: $??? The chart above shows what projected oil decline curves will look like with different rates of decline from oil fields collectively. Currently, global demand is at 86 million barrels/day. Peak oil will likely see 2-4 years of sideways movement, with output remaining within 2-4%. Subsequently though, the dynamics of global oil depletion will fall into one of the following scenarios. The 3% decline is the "best case scenario." If everyone shows spirit in humanity and cut back on energy usage, this could occur. As per the article above, 8% appears to be the benchmark for declines in oil production after a well has passed peak utilization. Declines of 14% can be expected from fields such as Ghawar in Saudi Arabia that have been pumped full of seawater and mined hard. After peak oil hits, the initial 3 years to follow will see a decline, but not terribly noticeable. However, as the laws of compounding kick in, the three lines part down separate trails. The higher the percent decline year over year (YOY), the more concave the decline. Our global politicians should have prepared decades ago for the pending crisis, because the trend that occurs will dictate how hard society crashes and how high the human toll will be: the 3% curve will see global oil production fall by 50% in 2030, the 8% curve (realistic) will see global oil production fall by 50% in 2016 and 14% curve would see global oil production fall by 50% in 2013.

34 Peak Oil and Economic Effects http://www. theoildrum

35 Recent Quotes: "We're all going to have to diversify away from hydrocarbons over time.” President George W. Bush, April 19, 2005 “Doing nothing or doing too little too late will lead to a global economic and geopolitical tsunami with potentially devastating ramifications.” -- U.S. Congressman Roscoe Bartlet. (2005) "Peaking (oil) will be catastrophic... We are about to drive the car over the cliff and say, `Oh my God, What have we done?’” Robert L. Hirsch, US Dept. of Energy consultant, 2005. “After you drive a car off a cliff, it’s too late to hit the brakes. In effect, we have gone over the edge of the cliff.” Kenneth Deffeyes, author “Beyond Oil” Kenneth Boulding wrote: "Anyone who believes that exponential growth can go on forever in a finite world is either a madman or an economist."

36 Recent Quotes: (Peak oil) “…is one of the biggest social and political challenges for this century.” Robert K. Kaufmann, Professor, Center for Energy & Environmental Studies, Boston University. (2005) “We’ve embarked on the beginning of the last days of the age of oil.” Mike Bowlin, Chairman and CEO, ARCO, and Chairman, American Petroleum Institute (2005) “My father rode a camel. I drive a car. My son flies a jet airplane. His son will ride a camel.” --Saudi adage “Whether … (a transition to renewable energy) will come in time to avoid an energy crunch depends in part on how high a priority we give energy research and development.” Richard A. Kerr and Robert F. Service, Science, Vol 309, Issue 5731, 101 , 1 July 2005 he peak in global oil production goes beyond paying a few dollars extra to fill the gas tank. The 20th century could be called the "Petroleum Age." Inexpensive oil means goods can be imported and exported at little extra cost, people can live far from work and a small fraction of the work force can feed those that produce the goods and services we associate with modernity. All of this may change after the global peak in oil production. As such, the peak isn't just an economic problem, it is one of the biggest social and political challenges for this century.

37 Have Saudi’s Overstated their Oil Reserves?
Investment banker Matthew Simmons. Highlights many discrepancies between Saudi Arabia's actual production potential and its seemingly extravagant resource claims. May in fact be peaking soon.

38 What might we expect in near future?
Ever rising gasoline prices. Fewer recreational “road trips.” More use of trains. Airline travel ever more expensive. Commuting from the suburbs ever more expensive. Electricity, gas, heating oil, become ever more expensive. Rising inflation – everything will cost more (due to rising shipping and production costs). Economic recessions. International conflict over oil resources.

39 Worst case future scenarios:
Economic recessions. We might see a return of the Great Depression. Maybe a “Malthusian catastrophe” (e.g., population die-off).

40 Wonder what life would be like without cheap oil?
We already have examples: North Korea and Cuba. LA Times Article: "GLIMPSES OF A HERMIT NATION A decade after a massive famine, North Koreans are still struggling. In Chongjin, deprivation spurs change.” By Barbara Demick, LA Times Staff Writer, July 3, 2005. “…outsiders know relatively little about its people or the miseries they have endured since a famine in the mid-1990s wiped out an estimated 2 million people.” GLIMPSES OF A HERMIT NATION A decade after a massive famine, North Koreans are still struggling. In Chongjin, deprivation spurs change. By Barbara Demick Times Staff Writer July 3, 2005 Although North Korea's pursuit of nuclear weapons has captured the world's attention, outsiders know relatively little about its people or the miseries they have endured since a famine in the mid-1990s wiped out an estimated 2 million people. ... Disaster struck in the early 1990s. Chongjin's outmoded and inefficient factories had limped along on spare parts and cheap oil from the Soviet Union. When the communist bloc collapsed, suddenly there was no fuel for the power plants. Factories stopped. Farms couldn't produce because they depended on chemical fertilizers and electric irrigation systems. For years, one of the hallmarks of North Korea's government was its public distribution system, which doled out food and other goods to citizens nearly for free. The regime considered coal mining a strategic occupation, and miners were given extra rations. But in the early 1990s, the lights in the mines went out, as did the pumps that kept the shafts dry. Beams rotted and equipment corroded. As the mines ceased production, the rations stopped. The children were the first to start dying, then the elderly. Next to perish were men, who seemed to need more calories to survive than women. Chongjin residents learned to recognize the stages of starvation. First, the victims become listless and too weak to work. Their vision grows blurry. They become bone-thin, then startlingly, their torsos bloat. Toward the end, they just lie still, sometimes hallucinating about food. On the outskirts of Chongjin, the road widens into a boulevard lined with trees, a video taken by a visitor in 2001 shows. But newcomers soon sense something strange: In a city nearly as populous as Boston, there are almost no personal cars, only military and government vehicles. The roadway is so empty that schoolchildren stroll blithely down the middle. Power lines are strung overhead for trams, which run infrequently and are so crowded that people hang off the back. Even bicycles are a luxury, so most people walk, often with improbably large bundles on their backs. There are other oddities. The upper floors of an 18-story apartment building along the main boulevard are unoccupied because there are no elevators. There is a zoo, but it has no animals. There's hardly any garbage because there is too little to go to waste. The big power plant on the waterfront operates at about 25% of capacity, so when dusk falls, swaths of the city vanish into darkness. Kathi Zellweger of the Catholic charity Caritas recalls being driven into Chongjin: "It's pitch dark at night, so dark you can't even tell there is a city." Aside from a small, ragged seafood market at the east end of the harbor, the waterfront is desolate. The government has installed high fences to keep residents from leaving or fishing, which is illegal for individuals. Great article! This gives us an interesting contrast with Cuba. Both were geographically compact communist countries, both were left out in the cold when the Soviet Union collapsed - both economically and in terms of oil supply. North Korea is short of food and, according to the article, seems to be crumbling. Cuba, as we have seen in recent articles, is feeding its people, they still have medical care and education. Things aren't great, but they are getting by. So, what are the differences? One - North Korea requires winter heating and Cuba is tropical. Securing heat is not something Cubans have to do, which leaves time and labor left over for producing food. Two - North Korea maintains a massive military, and Cuba much less so. Three - At least according to this article, the North Korean government is not encouraging people to grow food, but Cuba (AFAIK) does. Four - Kim Jong Il seems to be quite a bit crazier than Castro. In the case of America, much of the country requires winter heat. We are an enormous country, so land transportation is an issue. We maintain a massive military. You are welcome to your own opinions as to the craziness of our glorious leaders. Dave Four Corners, CO - USA The Example of Cuba         How we might do that is suggested by perhaps the best recent historical example of a society experiencing a fossil-fuel famine. In the late 1980s, farmers in Cuba were highly reliant on cheap fuels and petrochemicals imported from the Soviet Union, using more agrochemicals per acre than their American counterparts. In 1990, as the Soviet empire collapsed, Cuba lost those imports and faced an agricultural crisis. The population lost 20 pounds on average and malnutrition was nearly universal, especially among young children. The Cuban GDP fell by 85 percent and inhabitants of the island nation experienced a substantial decline in their material standard of living.         Cuban authorities responded by breaking up large state-owned farms, offering land to farming families, and encouraging the formation of small agricultural co-ops. Cuban farmers began employing oxen as a replacement for the tractors they could no longer afford to fuel. Cuban scientists began investigating biological methods of pest control and soil fertility enhancement. The government sponsored widespread education in organic food production, and the Cuban people adopted a mostly vegetarian diet out of necessity. Salaries for agricultural workers were raised, in many cases to above the levels of urban office workers. Urban gardens were encouraged in parking lots and on public lands, and thousands of rooftop gardens appeared. Small food animals such as chickens and rabbits began to be raised on rooftops as well.         As a result of these efforts, Cuba was able to avoid what might otherwise have been a severe famine. Today the nation is changing from an industrial to an agrarian society. While energy use in Cuba is now one-twentieth of that in the US, the economy is growing at a slow but steady rate. Food production has returned to 90 percent of its pre-crisis levels.10

41 From:

42 MSNBC. com article: “Think it's hot
MSNBC.com article: “Think it's hot? Be glad you're not in Cuba - Daily blackouts putting nation in a bad mood.” July 12, 2005 “HAVANA — Summer’s searing temperatures getting you down? Just be glad you don’t live in Cuba where daily blackouts make it about impossible to beat this year’s record heat.” “At first, the blackouts were tolerable, four hours twice a week. But by mid-month they had grown to daily six-hour ordeals.” “Still, she considers herself lucky. ‘We live on the top floor apartment so we get to use the roof to sleep.” People’s biggest complaint has to do with the nighttime blackouts. It’s hard to sleep without the use of an air conditioner or fan.’” Cuba at Night After Cuba’s oil subsidies from the Soviet Union ceased in 1990, that country’s petroleum-based agricultural system became untenable. Cubans went to work and converted their food production to an all-organic, locally-based system and now they feed their people sufficiently without much fossil fuel use at all. We already have an example of what happened to Cuba when cheap Russian imports ended with the collapse of Communism. "Cuba has become an undeveloped country. Bicycles are replacing automobiles. Horse-drawn carts are replacing delivery trucks. Oxen are replacing tractors. Factories are shut down and urban industrial workers resettled in rural areas to engage in labour intensive agriculture. Food consumption is shifting from meat and processed products to potatoes, bananas and other staples" 2 Think it's hot? Be glad you're not in Cuba Daily blackouts putting nation in a bad mood; Dennis only made it worse By Mary Murray Producer NBC News Updated: 2:10 p.m. ET July 12, 2005 HAVANA — Summer’s searing temperatures getting you down? Just be glad you don’t live in Cuba where daily blackouts make it about impossible to beat this year’s record heat. The island’s electric company began dimming the lights last month after it began rotating its most important power plants off line for regular maintenance. At first, the blackouts were tolerable, four hours twice a week. But by mid-month they had grown to daily six-hour ordeals. The island’s power grid, which has the capacity to produce 3,200 megawatts a day, is barely producing half of that. But, a recent hot spell caused a major meltdown. The Antonio Guiteras generator, located some 60 miles east of the capital, broke down for more than a full day, causing an energy deficit of more than 70 percent. “It’s enough to drive anyone crazy,” moaned Raúl Jiménez, who said he “barely survived” the 18-hour blackout that hit his crowded neighborhood in Central Havana. His neighbor, Luisa Diaz, described the blackouts as “exhausting.” Returning home from her factory job, the 42-year old machinist said she braces for her “daily fight with the refrigerator. I’m either worried about it breaking, mopping up a pool of water because it defrosted, or throwing out food.” The outages have not only sparked widespread complaining, but random incidents of protests. Residents of two Havana high rises report that during nighttime blackouts — when it’s too dark to identify the culprits — some people hurl empty glass bottles and cans off their balconies while others shout anti-government slogans. Appeal for patience Yadira Garcia, Cuba’s Minister of Basic Industry — the oveseer of power generation — went on national TV last week to beg for people’s patience while offering a cautious hope that things should begin improving later this month. “But, no one can guarantee that there won’t be new breakdowns in the old equipment," Garcia said. Age, she said, is a big part of the problem. Cuba’s seven principal power plants, built with now outdated technology from the former Soviet bloc, have been generating electricity for over three decades. Breakdowns are routine, said Garcia, and parts have to be imported. “Sometimes replacement parts aren’t even manufactured any more and have to be made special to order just for us.” Upgrading just one thermoelectric plant outside of Havana is costing $20 million. That’s why she’s warning the public to “prepare for a very tense summer.” Hurricane Dennis And that was before Hurricane Dennis tore across the island this past weekend, knocking down over a thousand electric poles, 36 high tension towers and causing more than $1.4 billion in material damage. For Digna Despaigne, 42, this only makes matters worst, and guarantees no respite from her daily grind. She wakes at 4 a.m. every day to cook her 5-month-old son’s baby food and iron his cloth diapers. “My whole life is turned upside down. I’m always tired.” Still, she considers herself lucky. “We live on the top floor apartment so we get to use the roof to sleep.” People’s biggest complaint has to do with the nighttime blackouts. It’s hard to sleep without the use of an air conditioner or fan. Almost 96 percent of Cuba has electricity, comparable to developed countries and far ahead of most in Latin America. Conversely, blackouts have plagued the communist government since 1990, when Soviet oil shipments to the island began drying up. With energy as its Achilles heel, Havana has invested over $150 million in developing its own petroleum production. While Cuba now can generate 90 percent of its electricity from local gas and oil extraction, its high-sulfur crude easily clogs the thermoelectric machinery and requires expensive cleaning. So, the island relies partly on Venezuelan imports, quality crude that burns cleaner.

43 Cuba’s vs. N. Korea Oil Crisis: Why was Cuba able to avoid famine?
Cuba had a similar oil crisis when the Soviet Union collapsed, but, unlike North Korea, they were able to avoid famine. Why? How? Cuba has averted famine so it has at least been successful in this. It has transitioned its agriculture away from industrial energy intensive farming into a low input organic approach. Many tractors sit rusting in their sheds while farm animals are being more and more used to pull the plough. It will be interesting to study how they cope with their deteriorating power distribution infrastructure. North Korea was (and is) governed by an insane dictator: Cuba was (and is) governed by a very sane dictator who evidently has the welfare of the Cuban people at heart. Cuba has been cited by many as a country who has successfully addressed Peak Oil.  Cuba's imported oil subsidies from the USSR/Russia declined with the Fall of the USSR in The critical point is that only now, years later, is the follow on deterioration of their infrastructure due to age, wear and tear, lack of maintenance etc coming into to play. It was/is too premature to say that Cuba has addressed Peak Oil. A second point made clearly in the original article is that the follow on effects of a post oil peak may take many years of continued degrading and erosion to reach a crisis level. I do think Cuba serves as an interesting test case showing how delayed responses to a post oil peak take along time to build to crisis levels.  Rather than successfully addressing Peak Oil, it looks more like Cuba is one of the growing number of global poster children for failed energy starved countries. Cuba vs. North Korea Subject: RE: Cuba vs. N. Korea management of oil crash North Korea cold, Cuba warm :-) But for more [real] detail see these: Drawing Lessons from Experience; The Agricultural Crises in North Korea and Cuba -- Part 1 Cuba-A Hope

44 Historical Energy Sources: Energy Phase Transitions
Wood, which was replaced by Coal, in the 1800s, which was replaced by Oil, in the 1900s, which must be replaced by a renewable energy source… _________ ? in the 2000s (?) Solar? Wind? Nuclear Fusion (hot or cold)? (Current nuclear fission is finite and non-renewable) .. the peak in global oil production [is different from] from previous energy transitions. As society changed from wood to coal and coal to oil, the new energy resource was "better" than its predecessor. It could be used more efficiently and generated a greater surplus. ...no fuel now being researched generates a greater [energy] surplus or can be used more efficiently than oil. -- Robert K. Kaufmann, Center for Energy & Environmental Studies, Boston University.

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46 Energy Phase Transitions
Each previous “energy phase transition” wood -> coal -> oil was to a more dense energy source. PROBLEMS WE FACE NOW Energy Density: All clean, renewable energy sources are far less dense Demand for wood and coal could be met when they were needed. But demand for oil will rise inexorably, as production inexorably decreases. Demand cannot be met.

47 Perilous Energy Phase Transition Period to renewable energy sources
Do we have enough time? Or, is it already too late? Transition period is very risky. Huge infrastructure changes / investments It takes time to transition smoothly – we may not have started soon enough. Costs of infrastructure change will be enormous We need to start immediately. oil peaking problem can be mitigated with available technologies, but the time required for implementation is measured on a year time line, at best. The character of the oil peaking problem is like none other; without timely mitigation, the impacts will be dire, worldwide, and long-lasting. Prudent risk management dictates serious attention and massive action soon, which is difficult for most people and many decision-makers, who tend to wait until a problem is obvious before taking action. -- Robert Hirsch recently submitted a 96 page report commissioned by the DOE, which basically says it would take 20 years to even mitigate the effects of peak oil

48 IN SUMMARY: TAKEN IN THE LONG VIEW – THE OIL AGE WAS A MERE BLIP IN TIME. END OF REVIEW OF THE MALTHUSIAN PERSPECTIVE ANY QUESTIONS?

49 The Kurzweilian Perspective: Scientific technology to the rescue!
Part B: Ray Kurzweil: Technological knowledge will increase geometrically Exponential explosion of scientific knowledge will allow us solve problems of carrying capacity, find unlimited energy sources (e.g., fusion), cure disease and aging, and to become immortal.

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51 The Law of Accelerating Returns
Ray Kurzweil argues: Machine intelligence will surpass human intelligence, leading to “The Singularity” -- Technological change so rapid and profound it represents a rupture in the fabric of human history Merger of biological and non-biological intelligence

52 Possible sources of a breakthrough “techno energy rescue”?
Nuclear fusion – cold or hot? E.g., “Focus Fusion” -- “Hydrino Energy”? Controversial “classical quantum mechanics” Posits that an electron can move much closer to the proton at the heart of a hydrogen atom and, in doing so, releases substantial amounts of energy / Methane hydrates (non-renewable)? Buried beneath the seabed and Arctic permafrost. A mixture of ice and natural gas, May contain more carbon than existing reserves of oil, coal and gas put together. But – can it be extracted? Cold fusion More than 16 years after chemists' claims to have created a star in a jar imploded in acrimony, the US government has said it might fund more research. Mainstream physicists still balk at reports that a beaker of cold water and metal electrodes can produce excess heat, but a hardy band of scientists across the world refuse to let the dream die. Hot fusion Turns nuclear power on its head by combining atoms rather than splitting them to release energy - copying the reaction at the heart of the sun. After years of arguments the world has agreed to build a test reactor to see whether it works on a commercial scale. Called Iter, it could be switched on within a decade. Methane hydrates The US and Japan are leading attempts to tap this source of fossil fuel buried beneath the seabed and Arctic permafrost.

53 Current renewable energy technology (no techo-fix needed).
Solar concentrators can be used for: Electrical Power Generation, Hydrogen Production 100 square mile area could provide all electrical needs of U.S. Another 100 sq miles could provide all of our transportation energy From: A Solar Concentrator:

54 100 square miles – solar PV could meet the entire U. S
100 square miles – solar PV could meet the entire U.S. yearly electrical needs. hows the ability of PV technology alone to provide all of the energy needs of the United States. This calculation assumes a 10% solar-to-electrical system efficiency and the use of fixed flat-plate collectors; tracking to follow the sun would lower the area required. A square ~161 km (~100 miles) on a side would, during 1 year, produce the energy equivalent to that used annually in the entire United States (3). Although 25,921 km2 (10,000 square miles) is a large area, it is less than one-quarter of the area that this country has covered with roads and streets. If wind is added to the energy mix, this area for PV is reduced (in fact, the United States also contains enough usable wind resources to produce all of the electricity used by the nation); if geothermal energy is added, the PV area is even smaller, and if hydroelectric energy is added, the area is again smaller. The point is clear--we can gather more than enough renewable energy to power our society. More important than the area required to supply this amount of energy is the way in which the electricity is generated. If we look at solar irradiance data (how much sunshine is available per day), we see that the sun only shines in that area for an annual average of ~6 hours/day (4). One of the major drawbacks to many forms of renewable energy is their intermittency, which I will discuss in more detail below.

55 Part 1 Conclusion: For today’s college students, in your lifetime …
From the baby boom generation to yours: Sorry, we used up most of the cheap oil… But, we developed a foundation of scientific knowledge that might help rescue you but we must start on a crash program immediately to transition to renewable energy… Within 20 – 50 years, you will likely know who “won” – either: Malthusian scenario: Economic collapse and perhaps a significant world population die off Kurzweilian scenario : Knowledge “singularity” – a scientific/technological energy transition rescue ANY QUESTIONS? -- HOW MANY OF YOU BELIEVE -- A MALTHUSIAN DIE-OFF WILL OCCUR A TECHNO-FIX? -- SOMETHING IN BETWEEN – e.g., switch to current renewable energy… Middle (?): No great techno-fix, but a gradual transition to current renewable energy technologies …and resulting recessions

56 Part 2: Global Cooperation During the Perilous Phase Transition to Renewable Energy
“The life contest is primarily a competition for available energy.” Ludwig Boltzman, Physicist (1886) Der zweite Hauptsatz der mechanischen Waermetheorie, 1886 (Georold, Vienna) p. 210. E.G., contest for the energy contained in food. Now, also a contest for fossil fuels “Energy determines what you can do, and often you can do what you will do.” Fredric Cottrell, Energy and Society (1955) “Whoever controls the oil, controls the world.”

57 How can we avoid an economic collapse, even a Malthusian die off?
Depletion of fossil fuels will lower energy availability by about 3% - 6% each year, every year, from here on out… …not pretty. We have to immediately conserve oil and gas, and rapidly transition to renewable energy (solar, wind, etc.) hope for an extraordinary energy technology rescue (e.g., fusion, etc.) It is too risky now to rely only on a possible future “techno-fix” Need now: World-wide conservation of fossil fuels Build infrastructure for current renewable energy Invest in research to try to find a breakthrough “techo-fix”

58 Peaking of World Oil Production: Impacts, Mitigation, & Risk Management Led by Dr. Robert Hirsch, U.S. Department of Energy (2005) If a crash program to switch from oil to renewable energy begins: 0 years before Peak Oil: Leaves the world with a significant liquid fuel deficit for more than two decades. Severe economic disruptions. 10 years before Peak Oil: Helps considerably but still leaves a liquid fuels shortfall for roughly a decade after the time that oil would have peaked. Moderate economic disruptions.   20 years before Peak Oil: Appears to offer the possibility of avoiding a world liquid fuels shortfall for the forecast period. Slight economic disruptions. Hirsch: “The world has never confronted a problem like this, and the failure to act on a timely basis could have debilitating impacts on the world economy. Risk minimization requires the implementation of mitigation measures well prior to peaking.” Source: The totality of impacts may force policy makers to rely heavily on the precautionary principle, which compares the costs of being correct to those of being incorrect. We know that oil production will peak within our lifetime, we think market prices may not anticipate this peak and we know that not having alternatives in place at the time of the peak will have tremendous economic and social consequences. So, if society does too much now, as opposed to later, there will be some loss of efficiency. But if society does too little now, as opposed to later, the effects could be disastrous. Under these conditions, doing too little now in the name of efficiency will appear in hindsight as rearranging deck chairs on the Titanic. -- Robert K. Kaufmann, Center for Energy & Environmental Studies, Boston University.

59 Problem: Human Nature From a biological perspective:
Humans are designed to maximize their own reproductive output (“Darwinian Fitness”) And help family and close kin (“inclusive fitness”) We’re not much inclined to help non-kin strangers. Examples: “Tragedy of the Commons” “Free-rider problem”

60 Who would you save? There are 2 doors
Behind the door on the right is your child, who will die if you don’t open that door. Behind the door on the left is someone else’s child, who will die if you don’t open that door. You can only open one door. Which door do you open. Why?

61 When will people tend to cooperate with others?
…when dealing with genetic relatives (Hamilton’s “inclusive fitness theory”). …when repeated interactions with non-relatives offer reciprocal benefits (Triver’s “tit-for-tat reciprocity” theory) And cheating (“temptation”) is reliably punished. …when dealing with non-relatives, when social rules against cheating are usually enforced, and the resource “pie” is growing (Ginits, et al., “generalized reciprocity” – e.g., “follow the rules, even when no-one is watching”). Peak oil: -- we are relying on “generalized reciprocity” -- How can we foster that?

62 ‘Hamilton’s Rule’. r = degree of genetic relatedness
b = benefit (in reproductive terms), to related individual c = cost (in reproductive terms) to altruist Altruism will occur when: c (cost to you) < (r) b (benefit to kin)

63 When will you be altruistic
When will you be altruistic? Answer: when cost to you < (r) x (benefit to kin) c < rb -- plug in some sample values… To your siblings (share ½ of your genes): When benefit to a sib is 2x cost to you: 1 < (.5) cost to you < (r) benefit to sib e.g, c < rb Only when it will cost you less than $1 to get your sib at least $2 To ½ sibs, aunt/uncle, niece/nephew (r = .25) 1 < (.25) 4 When benefits to this kin member is 4x the cost to you. Only when it will cost you less than $1 to get your nephew at least $4 r =  8x benefit to other vs. cost to you r = .062  16x benefit vs. cost to you r = .031  32x benefit vs. cost to you r = .015  64x benefit vs. cost to you Sad bottom line: As r declines, altruism will exponentially decline…

64 Arab Adage Me against my brother. Me and my brother against my cousins
Me, my brother, and my cousins against the village Me, my brother, my cousins and my village against the other village”

65 Game Theory: Types of Social Interactions
You Other Person Gain Lose Reciprocity/ Mutualism Altruism Selfishness (inclusive fitness theory) Spite Biological evolution tends to produce organisms that compete – inclusive fitness is relative to that of others. So, “selfish” behavior tends to be advantageous. However, there are exceptions when cooperative can appear and be sustained.

66 Game Theory and Peak Oil
Your Oil Consumption: Everyone Else’s Oil Consumption Reduce Increase Reward, Reward Sucker, Temptation Temptation, Sucker Punishment, Punishment Payoffs: T > R > P > S Highest Payoffs: T > R > T = temptation to “cheat” Then: R = Reward for mutual cooperation P = Punishment for defection S = Sucker Payoff  worse scenario for an individual. Basic Paradox of Prisoners Dilemma: -- the most “rational” move is to defect (Temptation). -- but, if everyone else does this, you are in trouble (along with everyone else) Economists call the the “free rider problem” Or, Hardin’s “Tragedy of the Commons” Possible Solution to this social dilemma: -- punishment by the social group for cheating

67 Problem: Cooperation is Far Less Likely in a Negative Sum Game
Generalized reciprocity works well when the overall resource pie is growing (a “positive sum game”). The costs of cooperating are low. But Peak Oil crisis is a “shrinking energy pie” situation (a “negative sum game”). Peak oil requires the whole world to cooperate as resources grow scarce. How can that be achieved?

68 Peak Oil Bell Curve Ascent and Decline Strategies
Peak Oil Slope Ascent Strategies: Served us well on peak oil ascent: Free market capitalism, consumerism, globalism, un-taxed energy use, no incentives for renewable energy use, short term time horizon But now, it is dangerous if we cling to those “Ascent Values” Peak Oil Slope Decline Strategies: Requires new ways of thinking. Government: conservation and renewable energy incentives, taxes on excessive energy use, RIMINI Protocol (shared burdens) Businesses and Individuals: Localization (food, manufacturing, etc.), energy conservation, use of renewable energy. Sound policy should establish an economic environment that increases the economic returns and reduces the risk to long-term research and development on alternative energies. Specifically, policy should impose a large energy tax that is phased in over a long period, perhaps 20 years. Furthermore, increases in the energy tax should be "offset" by reducing other taxes, such as payroll or corporate taxes. Economic studies show that such an approach can generate a "win-win" solution -- reduce energy use (and the environmental damages not paid by users), stimulate research and development on alternative energies, and speed economic growth. Phasing in an energy tax would send a signal to entrepreneurs that there will be a market for alternative energies. The tax does not pick technologies -- that will be left to the market, which is smarter than any Democrat, Republican, or even myself! Why is such an approach needed? If the market doesn't anticipate the peak, the price signals needed to stimulate research and development may not arrive until after the peak. By then, it will be too late to avoid major disruptions. Think about the changes needed to replace motor gasoline. Society will have to retool the auto industry, alter every gas station and retrain every auto mechanic. These changes need to start before the peak. If they start after, they will add to the disruptions caused by the peak. -- Robert K. Kaufmann, Center for Energy & Environmental Studies, Boston University. There also is a classic economic externality that may lead to underfunding of basic research. For something like fusion, it is clearly unreasonable to expect the private market to invest adequate resources, because the benefits to society from a successful program exceed the private returns to individual investors. On the other hand, as you get into more specific and near-term technologies, the justification for government involvement becomes less clear. For example, producing ethanol from corn is a mature technology, and indeed, one which some studies suggest uses up more energy than it produces. Congressional enthusiasm for subsidies here may have more to do with farm politics than energy needs. Relying on governments to pick the technological winners is a risky proposition. One of the benefits of Robert's tax plan is that it adds some extra incentive for any workable solution but leaves it to the market to sort out which ones are the real winners. James D. Hamilton is professor of economics at the University of California, San Diego.

69 Imagine…you are on Easter Island
How do you convince your tribe, and other tribes, to create a “sustainable timber industry” on the island? Instead of businesses “plundering” the planet, is “sustainable capitalism” possible?

70 THE RIMINI PROTOCOL http://www.peakoil.ie/protocol
Kyoto Protocol deals with climate change. “Oil Depletion Protocol” (RIMINI Protocol) deals with Peak Oil. “Each importing country shall reduce its imports to match the current World Depletion Rate.” That is, if World Depletion Rate is 3%, the U.S. (and all other countries), must reduce it’s oil imports by 3% per year. That is: agreement for each nation to share the declining energy burden proportionately. The stakes are very high -- if every nation follows these guidelines, we may be able to avoid conflict and resource wars over the remaining fossil energy supplies as they grow ever more scarce and precious. From: How Would It Work? The idea of the Protocol is inherently straightforward: oil importing nations would agree to reduce their imports by an agreed-upon yearly percentage (the World Oil Depletion Rate), while oil exporting countries would agree to reduce their rate of exports by their national Depletion Rate. Let us explore a few examples: Norway is a country that reports exceptionally accurate reserve estimates. The total produced to-date is 18.5 billion barrels (Gb), and 11.3 Gb remain in known fields, with about 2 left to find, giving a rounded total of 32 Gb. It follows that 13.5 Gb are left to produce. In 2004, 1.07 Gb were extracted, giving a Depletion Rate of 7.4 percent (1.07/13.5). This is a comparatively high rate, typical of an offshore environment. In the case of the US (considering only the lower 48 states and excluding deepwater), the corresponding numbers are: produced to-date, 173 Gb; Remaining Reserves, 24 Gb; Yet-to-Find, 2 Gb - meaning that there are 27 Gb left. Annual production in 2004 was 1.3 Gb, giving a Depletion Rate of 4.6 percent (1.3/27). For the world as a whole, 944 Gb have been produced; 772 remain in known fields; and an estimated 134 Gb is Yet-to-Find, meaning that 906 Gb are left. Production of conventional oil in 2004 was 24 Gb, so the Depletion Rate is 2.59 percent (24/906). These estimates exclude non-conventional oil - oil shales, bitumen (oil sands), extra-heavy oil, heavy oil, deepwater oil, polar oil, and liquids from gasfield plants. Most oil produced to date has been of the conventional variety, which will dominate all supply far into the future, so it makes sense to concentrate on this category. It must be stressed that current Reserves estimates in the public domain are grossly unreliable, and one of the purposes of the Protocol is to secure better information. The assessed Depletion Rate for each country, and eventually for the World as whole, is subject to revision when better information becomes available, but the resulting correction of the Depletion Rate will not be large, probably causing it to vary by less than one percent. The Depletion Protocol would require importers to reduce their imports by the World Depletion Rate (i.e., 2.5 percent) each year in order to put demand into balance with world supply. As stated earlier, exporters would reduce their production according to their national Depletion Rate. Thus Norway would reduce its production by 7.4 percent each year (that country's production is already declining at an even higher rate). The imposition on the producing countries represents no great burden, since few can now increase their rate of production in any case, and many are experiencing declining production for purely geological reasons, as is the case with Norway and the US. Agreeing to produce less oil would not inhibit exploration because new finds would lower the national Depletion Rate, and thus permit a higher rate of export than would otherwise be the case. The main thrust of the Protocol would be to require importers to cut imports, but the inclusion of producers in the provisions would stimulate greater cooperation between the two factions. Any indigenous production in a country that was a net importer would not be likely to provide that country with an unfair advantage, as production within most importing countries is already declining at a rate higher than the World Depletion Rate. How importers dealt internally with the import restriction would be up to them (though strategies both to obtain supplies of alternative fuels and to reduce demand for oil would doubtless be required). Some might wish to introduce an energy allowance as a form of tradable ration (as will be discussed in more detail below). Discussion of the Protocol Questions and Possible Objections The Protocol may at first look like merely a good idea with no real chance of implementation. However, closer inspection suggests that its implementation will benefit nearly all important global stakeholders and that objections likely to be raised to it are easily countered. What if forecasts of a near-term peak in global oil production are wrong? Won't there be a cost to preparing for the oil peak too early? In practical terms, won't this mean voluntarily choking off economic growth? Because so much is at stake, it is important that these vital questions be addressed not just by partisan participants in the debate over the timing of the oil-production peak (the so-called "oil optimists" and the "oil pessimists"); some independent assessment is required of the costs of preparing too soon versus the costs of preparing too late. Fortunately, such an assessment has already been undertaken - "Peaking of World Oil Production: Impacts, Mitigation, & Risk Management," a Report prepared by Science Applications International Corporation (SAIC) for the US Department of Energy, released in February 2005, and authored principally by Robert L. Hirsch (hereinafter referred to as "the SAIC Report"). The SAIC Report concludes that substantial mitigation of the economic, social, and political impacts of Peak Oil can come only from efforts both to increase energy supplies from alternative sources and to reduce demand for oil. With regard to the claim that efficiency measures will be enough to forestall dire impacts, Hirsch et al. note that, "While greater end-use efficiency is essential, increased efficiency alone will be neither sufficient nor timely enough to solve the problem. Production of large amounts of substitute liquid fuels will be required." Further, "Mitigation will require a minimum of a decade of intense, expensive effort, because the scale of liquid fuels mitigation is inherently extremely large." Hirsch, et al., also point out that "The problems associated with world oil production peaking will not be temporary, and past 'energy crisis' experience will provide relatively little guidance." The SAIC Report agrees that mitigation efforts undertaken too soon would exact a cost on society. However, it concludes that, "If peaking is imminent, failure to initiate timely mitigation could be extremely damaging. Prudent risk management requires the planning and implementation of mitigation well before peaking. Early mitigation will almost certainly be less expensive than delayed mitigation." What if the pessimists are right and the world is at its peak of oil production now? In that case, is it too late to implement the Depletion Protocol? If the world reaches the peak of production within the next two years there will be too little time to undertake major mitigation efforts prior to the event, and therefore there are likely to be severe economic, social, and political impacts, as outlined in the SAIC Report. However, in that case the need for the Protocol should quickly and widely become apparent. While all nations will suffer from higher prices and shortages, only a cooperative system of national and international quotas will avert the even more extreme economic and geopolitical crises that would otherwise ensue. Why can't the market take care of the problem? Won't high prices stimulate more exploration and the development of alternatives? Wouldn't interference with market mechanisms be harmful? The SAIC Report's authors dismiss the claim that the market will solve any shortage problems arising from global oil production peak, with higher oil prices stimulating investments in alternative energy sources, more efficient cars, and so on. Price signals warn only of immediate scarcity. However, the mitigation efforts needed in order to prepare for the global oil production peak and thus to head off shortages and price spikes must be undertaken many years in advance of the event. Hirsch, et al., maintain that, "Intervention by governments will be required, because the economic and social implications of oil peaking would otherwise be chaotic. The experiences of the 1970s and 1980s offer important guides as to government actions that are desirable and those that are undesirable, but the process will not be easy." Historically, oil production has often been managed by governments or by cartels. In petroleum's early days, free-market boom-and-bust cycles bankrupted many players (including the "father" of the oil industry, Edwin Drake). Soon John D. Rockefeller brought a certain order to the situation through the creation of the Standard Oil Trust (in doing so he squeezed out many competitors and personally profited to an extraordinary degree). This regime came to an end in 1911, when the US Government broke up Standard Oil after prosecution for violation of anti-trust laws. Starting in the 1930s, with the US in position to control global oil prices, the Texas Railroad Commission capped production levels in order to stabilize the market. After US oil production peaked in 1971 and that nation lost its ability to control global prices, petroleum's center of gravity shifted to the Middle East, and OPEC began mandating production quotas for its members in order to keep prices within a desirable band. While the management of oil prices globally thus has precedents, the situation in the future will be fundamentally different than heretofore, in that previously the problem was too much oil and collapsing prices that offered little incentive for exploration. The situation the world will soon face is that of insufficient supply leading to extreme price shocks, price volatility, and acute shortages. Thus a new kind of management scheme will be required. How will adoption of the Protocol affect importers and exporters differently? Importers: No one doubts that industrial nations will find it difficult to sustain economic growth while using less oil on a yearly basis. Thus the voluntary adoption of the Protocol by importers would seem disadvantageous - a "tough sell." However, it must be recognized that a decline in the availability of oil is inevitable in any case; only the timing of the onset of decline is uncertain. Without a structured agreement in place to limit imports, nations will be inclined to put off preparations for the energy transition until prices soar, at which time such a transition will become far more difficult because of the ensuing chaotic economic conditions. With the Protocol in place, importers will be able to count on stable prices and can then more easily undertake the difficult but necessary process of planning for a future with less oil. Poor importing countries may object that by using less petroleum they will have to forego conventional economic development. However, further development that is based on the use of petroleum will merely create structural dependency on a depleting resource. Without the Protocol, these nations will be financially bled by high and volatile prices. With the Protocol in place and with prices stabilized, these nations will be able to afford to import the oil they absolutely need; meanwhile they will have every incentive to develop their economies in a way that is not petroleum-dependent. Exporters: Economies that are based primarily on income from the extraction and export of natural resources often tend to give rise to governments that are more responsive to the interests of powerful foreign resource buyers than they are to the needs of their own citizens. Thus it is in the interest of resource-exporting countries to develop indigenous industries in order to diversify their economies. Countries that depend primarily on income from oil exports will need to wean themselves from this dependence eventually in any case, as their oilfields are depleted; the Protocol provides them a means of making the transition in a way that will allow for long-term planning. Without the Protocol, smaller exporting nations will likely be at the mercy of militarily powerful importers. The Protocol will provide a means of minimizing external political interference in these nations' affairs. As a result, much international tension and conflict, including the threat of terrorism, can be minimized - which will be a help also to the wealthy importers. How will the oil companies be affected? Without the Protocol, the oil companies may enjoy record revenues - for a time. But they will be demonized for profiting from the misery of the rest of society; meanwhile, they will be hampered in their operations by the destabilization of national economies resulting from wildly gyrating oil prices. As noted earlier, the Standard Oil Trust, the Texas Railroad Commission, and OPEC all provided production-rationing mechanisms that brought order out of what would otherwise have been chaotic situations. The oil companies (sometimes reluctantly) accepted these mechanisms, recognizing that a stable economic environment was more important to them in the long run than the opportunity to make momentary windfall profits. With the Protocol, the oil companies will remain profitable, they will have the incentive to undertake further exploration, and they will be able to plan for decades ahead. They will also be motivated to become more generalized energy companies (rather than remaining merely oil companies) and thus to invest in the development of alternative energy sources. There is already evidence that the oil companies are concerned about a public backlash as gasoline prices soar: ChevronTexaco has initiated an expensive public-relations campaign titled "Will You Join Us?", featuring a web site (www.willyoujoinus.com) and expensive newspaper ads informing readers that "the era of easy oil is over" and asking for public discussion on the issue. The Oil Depletion Protocol will provide more long-term security for the petroleum industry than any PR campaign ever could, and at no cost. Won't both importers and exporters be tempted to cheat? How would the Protocol be enforced? The Protocol will require a system for monitoring production, exports, and imports - which cannot be hidden to a large degree in any case. Enforcement will require the establishment of a Secretariat for adjudication of disputes and claims, and a system of economic penalties to be negotiated by the agreeing nations. How can nations adjust internally to having less oil? Withdrawal from oil dependency will be an immense challenge that will require cooperation and compromise on everyone's part. Efforts will be needed both to create supplies of alternative fuels and to reduce the demand for oil. The latter task will be much easier if systems are designed to make it in individuals' interest not only to reduce their own oil dependency but also to persuade others to reduce theirs. One such system for creating collective motivation and cooperation consists of Domestic Tradable Quotas, or DTQs. DTQs can be used to ration all hydrocarbon energy sources (in order to reduce greenhouse gas emissions) or specific fuels such as oil. For the sake of discussion, let us assume the use of DTQs for petroleum only, as a way of implementing the Depletion Protocol within nations. First, a national Petroleum Budget would be drawn up, based on the nation's indigenous production and oil imports as mandated by the Oil Depletion Protocol. A segment of the Petroleum Budget would then be issued as an unconditional entitlement to all adults and divided equally among them; the remainder would be auctioned to industry, commercial users, and government. The units could then be bought and sold, so that users unable to cope with their ration could increase it, while others who kept their fuel consumption low could sell and trade their Petro-units on the national market. All transactions would be carried out electronically, using technologies and systems already in place for direct debit systems and credit cards. When consumers (citizens, businesses, or the government) made purchases of fuel, they would surrender their quota to the energy retailer, accessing their quota account by (for instance) using their Petro-card or direct debit. The retailer would then surrender the carbon units when buying energy from the wholesaler. Finally, the primary energy provider would surrender units back to the National Register when the company pumped or imported the oil. This closes the loop. All purchases of petroleum would be made with Petro-units, whether the oil were used as fuel or as feedstock for plastics or chemicals. So long as the petroleum remained fuel, Petro-units would have to be passed back up the line, starting with the end user. However, if the petroleum were incorporated as feedstock into the manufacturing of a product (e.g., plastics), the manufacturer would simply add the cost of the Petro-units into the cost of the product. Thus, in the case of feedstocks, the manufacturer of goods would be the presumed end user. Purchasers not having any Petro-units to offer at point of sale - foreign visitors, people who had forgotten their card or cashed-in all their quota as soon as they received it - would buy a quota at point of purchase, then immediately surrender it in exchange for fuel, but would pay a cost penalty for this (i.e., the bid-and-offer spread quoted by the market). DTQs place everyone in the same boat: households, industry, and government would have to work together, facing the same Petroleum Budget, and trading on the same market for Petro-units. Everyone would have a stake in the system. All would have the sense that their own efforts at conservation were not being wasted by the energy profligacy of others, and that the system was fair. Moreover, DTQs are guaranteed to be effective, because the only fuel that could be purchased would be fuel within the Budget. The Budget would set a long time-horizon so that people would have the motivation and information they needed to take action in the present to achieve drastic reductions in oil use over a 20-year timeframe. What if only a few nations sign on? Won't the Protocol be ineffectual if a few large exporters or importers refuse to do so? At first it might seem that those nations not adopting the Protocol would achieve an advantage. However, any temporary benefit would be purchased at the expense of later economic calamity. As discussed in the SAIC Report, nations that embark on the energy transition sooner will be much better off than those procrastinating. What about natural gas and coal - should there be similar protocols for these? Might countries simply burn more coal to make up for having less oil? The Oil Depletion Protocol will not preclude other agreements aimed at reducing fossil fuel usage in order to avoid impacts to the global climate, but it will be more ambitious in its reduction trajectory than the Kyoto Protocol or the Asia Pacific Partnership on Clean Development and Climate. If nations' experience with the Oil Depletion Protocol is positive, this will provide motivation for the forging of similar agreements covering these other fossil fuels. How can the process of adopting the Oil Depletion Protocol begin? A program to win implementation of the Protocol must focus on educating both the general public and top-level decision-makers. Adoption of the Protocol will require that a few policy makers champion it and bring it before their national parliament or congress. If even one country adopts the Protocol, this will help to open a global discussion. At the same time, it is important that citizens understand the issues and what is at stake, as pressure on elected officials from below will help focus the latter's attention on the matter. In the near future, a program will be underway to obtain endorsements of the Protocol from prominent organizations and individuals. This article is part of a preliminary effort to inform the public of both the Peak Oil issue and the Oil Depletion Protocol. Please help by copying this article and sending it to family, friends, colleagues, the media, and elected officials. This may be our last, best opportunity to avert resource wars, terrorism, and economic collapse as we enter the second half of the Age of Oil. THE OIL DEPLETION PROTOCOL WHEREAS the passage of history has recorded an increasing pace of change, such that the demand for energy has grown rapidly in parallel with the world population over the past two hundred years since the Industrial Revolution; WHEREAS the energy supply required by the population has come mainly from coal and petroleum, having been formed but rarely in the geological past, such resources being inevitably subject to depletion; WHEREAS oil provides ninety percent of transport fuel, essential to trade, and plays a critical role in agriculture, needed to feed the expanding population; WHEREAS oil is unevenly distributed on the Planet for well-understood geological reasons, with much being concentrated in five countries, bordering the Persian Gulf; WHEREAS all the major productive provinces of the World have been identified with the help of advanced technology and growing geological knowledge, it being now evident that discovery reached a peak in the 1960s, despite technological progress, and a diligent search; WHEREAS the past peak of discovery inevitably leads to a corresponding peak in production during the first decade of the 21st Century, assuming no radical decline in demand; WHEREAS the onset of the decline of this critical resource affects all aspects of modern life, such having grave political and geopolitical implications; WHEREAS it is expedient to plan an orderly transition to the new World environment of reduced energy supply, making early provisions to avoid the waste of energy, stimulate the entry of substitute energies, and extend the life of the remaining oil; WHEREAS it is desirable to meet the challenges so arising in a co-operative and equitable manner, such to address related climate change concerns, economic and financial stability and the threats of conflicts for access to critical resources. NOW IT IS PROPOSED THAT 1. A convention of nations shall be called to consider the issue with a view to agreeing an Accord with the following objectives: a.                to avoid profiteering from shortage, such that oil prices may remain in reasonable relationship with production cost; b.    to allow poor countries to afford their imports; c.     to avoid destabilising financial flows arising from excessive oil prices; d.    to encourage consumers to avoid waste; e.    to stimulate the development of alternative energies. 2. Such an Accord shall have the following outline provisions: a.                No country shall produce oil at above its current Depletion Rate, such being defined as annual production as a percentage of the estimated amount left to produce; b.    Each importing country shall reduce its imports to match the current World Depletion Rate, deducting any indigenous production. 3. Detailed provisions shall cover the definition of the several categories of oil, exemptions and qualifications, and the scientific procedures for the estimation of Depletion Rate. 4. The signatory countries shall cooperate in providing information on their reserves, allowing full technical audit, such that the Depletion Rate may be accurately determined. 5. The signatory countries shall have the right to appeal their assessed Depletion Rate in the event of changed circumstances. (Note: the Oil Depletion Protocol has elsewhere been published as "The Rimini Protocol" and "The RIMINI Protocol." All of these documents are essentially identical.)

71 Conclusion Peak oil means a shrinking fossil fuel “energy pie,” and higher oil costs, each and every year. Energy transition time window: We have a short window of time to transition to renewable energy. We need to start yesterday. We can hope for an energy techno-breakthrough (e.g., fusion), but we better not count on it. World-wide cooperation vs. human nature Avoiding conflict and resource wars over shrinking resources will require world-wide cooperation and conservation We need to see the threat as a common one that transcends borders, cultures and religions. Are we smarter than yeast in the petri dish? Can we “transcend” our human nature? ANY QUESTIONS OR COMMNETS?

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