Newsday editorial on peak oil

April 22, 2006

Are Americans willing to live with $100-a-barrel oil prices, which could translate into $6-a-gallon gasoline and heating oil? They may have no choice. It could happen as soon as five years from now, according to some energy experts. The price for a barrel of crude has nearly tripled in three years, from $25 in April 2003, to over $72 today.

But the more crucial question is this: Are Americans and their political representatives willing to make the individual and collective sacrifices needed to come up with viable mass-market energy alternatives to heat our homes, drive our cars and run our industries? They would have to accept the unpalatable prospect that a concerted national push for alternatives to oil will be neither cheap nor easy, and it won’t generate significant results for quite some time, even when such alternatives are made to work.

With global demand for oil rising much faster than supply, competition for this precious resource will continue to put enormous pressure on prices. The rapid industrial growth of China and India alone is already responsible for much of the price increase that’s shocking motorists at the gas pumps today. And the International Energy Agency (IEA) projects that the world’s total energy requirements will rise by half in the next 25 years – an increase that will be unsustainable at the rate oil is being produced today.

No, the world is nowhere near running out of oil soon. But there is a general agreement that it’s close to reaching peak oil production – a plateau after which production will begin to decline. It’s a geological reality that won’t change. As supplies of oil easily pumped from existing wells dry up, costly and complicated processes will be needed to extract oil trapped in shale and oil sands, or to liquefy coal into synthetic fuels. The result will be ever-higher prices for a shrinking commodity.

To be sure, there is more to recent price increases than competition from newly industrialized nations. The market in oil futures is jittery about the rise in tensions over Iran’s nuclear weapons program, Iraq’s failure to resume normal oil production, civil unrest that’s cut Nigeria’s production by a quarter, and an armed rebellion in Chad. In the United States, where not a single new refinery has been built in the past 30 years, gasoline and diesel prices have been jacked up by fuel shortages caused by Hurricane Rita’s damage to Gulf Coast refineries. Add to that the federal requirement for oxygenated fuels in the summer. While the former additive, the water-polluting MBTA, is being phased out, the ethanol brewed from corn in the Midwest is in short supply and costs a great deal to ship to the coasts, which increases gas prices. To add insult to injury, Congress, in a blatant nod to the corn-producing states, has imposed stiff tariffs and fees on imported ethanol, which is considerably cheaper than the stuff produced in the United States.

No easy ways out

What’s the alternative to oil? None of the clean, desirable alternatives – solar, wind, thermal and hydropower, hybrid cars – are more than “boutique” solutions. They’re unlikely to replace more than a small portion of oil. Fuel in the form of ethanol from biomass – renewable sources like grasses, grain, sugar cane, even garbage – is feasible, but would require a massive federal program and a huge distribution infrastructure.

Developing a hydrogen-based economy is promising, but would need a decade or more of research and great quantities of power to free up the element from water – power that could only come from the wide adoption of nuclear power production, a proven alternative that carries major problems with the disposal of radioactive waste and the potential for theft of nuclear material for terrorist weapons. The dream of clean, safe nuclear fusion – the source of the sun’s power – remains just that: a search for the modern equivalent of the philosopher’s stone. It’s never worked outside the laboratory, and no commercial reactors are expected before 2050, if at all.

Coal is abundant in the United States – it’s the largest source of carbon fuel in the world – and it’s already producing much of this nation’s electricity. But mining more coal has vast environmental costs. And using it with advanced scrubbers to clean up its emissions makes it almost as expensive as oil. Still, greater use of coal is part of the solution, as is the acceptance of nuclear power to generate more of the nation’s electricity than it does today. Even environmentalists are increasingly embracing nuclear power as an oil substitute, as much for its potential to lessen global warming as for its energy substitution.

What’s left? While substitutes are explored and nuclear power is sold to a skeptical public as a necessity, we must adopt the more prosaic but effective ways of dealing with fuel shortages and price hikes: conservation, higher mileage requirements for vehicles, greater reliance on public transportation and, for auto buyers, a willingness to switch to more frugal cars and trucks. But even these stratagems, however sensible and promising, will only be stopgaps until the nation weans itself away from oil and develops a sustainable alternative.

Examining alternatives is important. But far more crucial is persuading consumers to stop deluding themselves that there will be easy solutions. This will continue to be a slow, rolling crisis that needs a combination of savvy management, creative ideas about alternatives and, above all, the political will to frame a sustainable energy policy and demand sacrifices to implement it. That’s the more intractable shortage


Tags: Culture & Behavior, Energy Policy, Fossil Fuels, Oil