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Carbon: too much, not too little

Like Henry George’s theory of land taxation, Peak Oil seems to be one of those ideas, reasonable enough in itself, and modest in scope, that attracts a cult following in which it becomes the answer to all kinds of questions. This piece in Salon gives a tour of some of the wilder fringes (apparently serious people suggesting we are going back to the 13th century for example), and indicates the need for a correction.

The basic idea is simple enough, and reasonably plausible. Oil is a finite resource and sooner or later, extractions of oil must reach a peak. Application of a fairly simple model, with some previous successes to its credit, the Hubbert Curve, suggests that we are now at or near this peak, though lots of others disagree. Even if we are at the peak, it’s arguable that increasing prices will drive improvements in efficiency and reductions in demand sufficient to allow us to continue relying on oil in its main use (fuel for cars) for a long time to come, even as aggregate consumption declines gradually.

Suppose though, that availabilty of oil is going to decline to levels far below those of today. The question is, so what? A decline in the availability of oil would have a significant impact on various activities, but the availability and relative price of different goods change all the time. The increase in the cost of health care, for example, is much more significant than anything that has happened to oil or is likely to happen. Where do the Peak Oil crowed get their predictions of disaster?

The trick in the argument is to equate oil with fossil fuels in general. This is plausible enough for natural gas, which commonly occurs in the same places as oil, and is also in fairly limited supply. But the elephant in the corner in these arguments is coal. The US has enough easily accessible coal to supply hundreds of years of consumption at current rates, and the same is true of the rest of the world.

The Salon article mentions coal only a couple of times in passing. Yet coal and coal-fired electricity already compete directly with oil in all major uses except personal transport. If current oil prices are sustained for long, we can expect to see electricity displacing oil in home heating, and electrification of rail transport at the expense of diesel, reversing the trend of recent decades when diesel has been cheap. This is already happening.

As for cars, there are at least three well-established ways in which they could be fuelled by coal. First, there are electric cars. Second, there is coal liquefication, used on a large scale by South Africa in the sanctions period. Third, gasification could be used to replace liquid petroleum gas. All of these options have problems, but none are insurmountable given a high enough price; they might be competitive if oil stays above $60 a barrel long enough, and they would certainly be competitive at $150/barrel. Then there are more exotic options, like fuel cells using coal-based methanol.

The real problem with fossil fuels is not that we have too little but that we have too much. If we keep on burning them at current rates, we’ll cause highly damaging climate change. If we burned enough coal to run seriously short, we’d risk setting off a runaway greenhouse effect and making the planet uninhabitable. If Peak Oil is coming, it’s probably a good thing.

Editorial Notes: Many comments appear at the original article. Ezra Klein at TAPPED says:
None of this is to downplay the costs or dangers of an energy crunch, but we're not teetering on the brink of oblivion just because we use a lot of oil. Alternatives are plentiful, just not cheap. But as petroleum becomes more scarce and increasingly pricey, the relative expense of its competitors will start looking a whole lot better.
David Roberts at Gristmill says:
Say the end of cheap oil did drive us to coal. That would substantially accelerate global warming, as Quiggen acknowledges. But is something that forces you to commit suicide better than something that kills you directly? How does this diminish the significance of peak oil?
Nathan Lewis of Caltech takes the position that coal could replace oil, though with catastrophic side effects such as global warming. For him, the best way to avoid the problem is to develop cheap PV cells. (Lewis gives an excellent, though dense talk on energy here (halfway down the page) / more material here ) Yankee has started a forum on the article at The Oil Drum UPDATE: Heading Out weighs in at The Oil Drum: Pregnancy revisited or some thoughts on coal -BA

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