Insight and inspiration in turbulent times.
In my last post, I looked at the Internet’s energy use, broadly construed, and contended that we might offload other societal functions onto the Internet. In this post I’d like to consider in what ways that might be an unwise approach given the dependencies of the Internet.
An eleventh hour political deal on the US debt crisis this week turned out to be just a stepping stone in the ongoing economic and fiscal crisis. By Thursday markets were plunging again on fears that Italy or Spain may default, and on the growing anticipation that the US may be returning to recession after Q1 GDP growth numbers were revised down from 1.9% to 0.4%.
Shale gas has become an important and permanent feature of U.S. energy supply. Daily production has increased from less than 1 billion cubic feet of gas per day (bcfd) in 2003, when the first modern horizontal drilling and fracture stimulation was used, to almost 20 bcfd by mid-2011. There are, however, two major concerns at the center of the shale gas revolution. Despite impressive production growth, it is not yet clear that these plays are commercial at current prices because of the high capital costs of land and drilling and completion. Reserves and economics depend on estimated ultimate recoveries based on hyperbolic, or increasingly flattening, decline profiles that predict decades of commercial production. With only a few years of production history in most of these plays, this model has not been shown to be correct, and may be overly optimistic.
A strong majority of Americans say it is likely that oil prices will triple in the coming five years and that such a tripling would be harmful both to the economy and to public health. Conservatives and those dismissive of climate change are among the most concerned by the threat of a major spike in oil prices, suggesting that a broad cross section of Americans may be ready to engage in dialogue about ways to manage the risks associated with peak petroleum.
Lost in the furor over the debt crisis last week came the news that the U.S. economy expanded at an annual rate of only 0.4 percent in the first quarter and 1.3 percent in the second. As these numbers were well below what economists were expecting, the revelation that the US was not coming out of the “great recession” was quite a shock for those who have not been paying attention.
A midweekly roundup of peak oil news, including:
-Developments this week
Economists insist that recovery is at hand, yet unemployment remains high, real estate values continue to sink, and governments stagger under record deficits. Richard Heinberg propose a startling diagnosis: humanity has reached a fundamental turning point in its economic history. The expansionary trajectory of industrial civilization is colliding with non-negotiable natural limits.
A weekly roundup of peak oil news, including:
-Oil and the global economy
-Canada
-Japan
-Sabotaging pipelines
-Quote of the week
-Briefs
In this year, 2011, we are enjoying a lifestyle beyond the most optimistic dreams of past generations. We are benefitting from the whirlwind of achievements in science and technology during the last hundred years. There has never been a century like the one just passed, and there will never be another like it. Lifestyles will be very different when oil and gas are depleted.
Some time ago an economist with whom I had an extensive exchange suggested that the best way to incentivize an energy transition would be to tax what we don’t want and let the market do the rest. It was really such an elegant approach and an impractical one, I thought.
Profits were up at the supermajors again in Q2 as high oil prices offset the rising cost of new production. Shell’s Peter Voser said that high prices were having an effect on demand for oil, especially in Europe – this could be seen reflected in flat UK growth figures and weak numbers even for major German manufacturing companies.
A midweekly roundup of peak oil news, including:
-Developments this week
-Japan
