Why Worry About Collapse? Tom Murphy, Do the Math. May 18, 2021.
The first thing I should say is that the word collapse freaks me out. I don’t use it often, for fear of sounding like an unhinged alarmist. Surely, respectable scientists should want nothing to do with it.
The second thing is that I don’t harbor any secret pleasure in imagining catastrophic failure of the human endeavor. It depresses me, frightens me, angers me, frustrates me, confuses me, and makes my wife crabby.
What keeps pulling me back to it—despite my innate repulsion—is not only credible elements of risk that I will get to in this post, but also that I think it’s too important to tolerate our natural tendency to hide from the prospect. Ironically, doing so only raises the odds of that ill fate: mitigation requires direct acknowledgment. Failure to speak openly and honestly about the less-than-remote possibility of collapse is not in our best interest, ultimately.
So let’s grit our teeth and confront the collapse monster. What conditions make it at once likely and off most people’s radars?
It is a heavy lift for one blog post to do a complete job in motivating collapse as a realistic outcome of the human enterprise. Any one argument can be picked at, but the totality should be considered. This is a long post, so buckle up.
[Added after posting] An early comment helpfully pointed out that I failed to define collapse. For the purposes of this post, we can think of collapse as a drastic and probably chaotic reduction in energy and resource use per person, the result looking primitive by today’s standards. Population may plummet through famine or other disruption. What remains might not maintain much of our present technology, and in the worst cases lose much of our accumulated science/knowledge. I am not talking about extinction of our species or necessarily reversion to hunter-gatherer lifestyles (thought that’s certainly on the table). Most would see this trajectory as a colossal failure of the enterprise.
To Those Who Won’t Have Any of It
First, if like many you find yourself resisting the idea of collapse—even before getting into the details—ask yourself why. Is it because you somehow know it won’t happen? Have you thought through how society organizes itself to confront global resource limits and to cope for thousands of years on natural flows? Have you identified a scheme for—and transition path to—global cooperation and governance that protects substantial areas of wilderness on land and sea for countless generations? Have you thought of a compelling reason why humans would abruptly stop competing and exploiting resources as quickly as possible, or stop striving to accumulate more possessions and luxuries for themselves? Does it seem obvious that humans will—for the first time en masse—adopt an attitude that nature is at least as important as ourselves, and deserves top priority?
If you think these questions are totally missing the mark, then what’s behind the disconnect? Do you dismiss the idea of resource limits? Does Earth seem so vast that human presence cannot possibly ruin whole ecosystems? Do you challenge the notion that nature is important and a necessary life-support system that should be kept intact? Have we transcended evolution or our physical underpinnings? Are we using the same physics? Or are you simply unconcerned with humanity’s fate after you’re gone, so that collapse of civilization and loss of science/knowledge within a few hundred years is no biggie?
It’s also possible that you simply have not thought deeply about it, performed calculations, or considered long enough spans of time. Is it then a preference, a hunch, a reaction—perhaps based on abhorrence of the idea? What can you really say, when it comes down to it, that definitively settles the case that we’re safe from collapse? Are we safe enough, in fact, that even a serious discussion is wasteful or itself more dangerous than any intrinsic threat?
It may be that pride in our accomplishments has swollen into an unshakable faith that human ingenuity trumps natural limits.
The appeal and origin of this notion is completely understandable and forgivable in light of the incredible developments of the last few centuries. It is easy to get carried away in awe of human achievement, overlooking the fact that the recent amazing past has been fueled by our spending a one-time inheritance as fast as humanly possible. Humans always have been amazing creatures, and always will be. What sets the last few centuries apart is the speed with which we’ve consumed Earth’s finite stocks.
In order to have a constructive conversation about collapse, we must set aside what we want to be true and try to detach from the enormity of the prospect in favor of a cool analysis. Just as fearing and denying our own death will not prevent its ultimate arrival, similar evasive reactions will not decide our fate on the question of collapse. In fact, they may act to secure a catastrophe. Only by breathing deeply and accepting that collapse is a legitimate possible outcome, and one that many current elements are directing us toward, can we justify any confidence in averting such an end. So collapse, unlike death, is not inevitable unless we fail to take the prospect seriously.
Do I Think Collapse is Coming?
Before getting to the main event, I should clear the air on the question of whether I am a “collapsist,” if that’s a word (spell-checker is saying no). My simplest answer is: I am decidedly anti-collapse, and am optimistically and perhaps irrationally motivated to do whatever it takes to prevent such a catastrophe from materializing. But I see the risk as being real enough and scary enough that I’ll take sober acknowledgement of the possibility over careless dismissal any day.
So my decision is to communicate the risk of collapse as perhaps the best way to ultimately dispel my concerns. Nothing would give me greater joy than for heightened awareness and consequent mitigation efforts to prove my worries to be wrong. Dismissal, sadly, plays right into my worst fears. Thus, until I see global efforts explicitly aimed at mitigating the collapse-prone elements detailed below, I am afraid that my fundamentally conservative core requires a default position that collapse is the most likely outcome: assume the risk real, so that it may be prevented.
Elements Promoting Collapse
What follows are separate but not always independent points of consideration. The goal is to hold all these in mind simultaneously. As a builder of scientific instruments, I have become accustomed to respecting a handful of different constraints and objectives all at once in order to forge a compromise path in developing a device that works and delivers useful data. Forgetting any one of several dozen—sometimes interacting—constraints can lead to a failed instrument. What follows is a bit like that for me: a swirling collection of important elements, none of which may be ignored. Ask yourself as you go along which of the 21 points/perspectives are firmly planted in the public consciousness as an obvious matter enjoying broad agreement.
1. Civilization (cities, agriculture) is about 10,000 old. If we want to believe that civilization is in its infancy and not near its end (i.e., if we are to reject the notion of collapse), then we should be thinking about thriving on timescales of 10,000 years or longer. Even a collapse within 1,000 years would probably be regarded by nearly everyone as an undesirable failure of humanity.
2. The growth trajectory is manifestly impossible to continue for centuries more. In physical terms, continuing energy growth at about 2% per year results in Earth reaching boiling temperatures in 400 years—not due to CO2 but just the sheer thermodynamics of waste heat. In mineral resources, maintaining a similar growth rate would have us mining materials at a pace 10,000 times the current pace in 400 years. How much accessible copper is even around? Have we not scooped out the easy resources—the low-hanging fruit? Indefinite growth in any physical measure is incompatible with a finite planet bearing a finite inheritance and a finite carrying capacity. For a resource that we have used 10% of, for instance, any rate of extraction greater than 0.0002% per year is unsustainable. Exponentials are cruel beasts, and cannot persist for long in a physical system.
3. Holding steady is hard, too. Since growth is an absurd short-lived anomaly, what about leveling out in population, resource use per capita, and adopting a steady-state economy? The problem here is that the rate at which we are depleting one-time resources today is unsustainable. We’re simply spending our bank account without paying attention to the balance and without any source of additional income. Most clearly, forests and wild spaces are down by a factor of two in the last 60 years, and will be gone within 60 years at current rates of depletion. Before even getting to steady state conditions, inevitable near-term increases in population together with sought-after increases in standards of living around the world spell an even shorter lifetime for critical habitats. Meanwhile, fisheries are failing in domino fashion; aquifers are being depleted at rates alarmingly higher than replacement; soils are degrading and arable land is lost; fertilizer depends on a finite resources; habitat loss is resulting in species extinctions far in excess of natural rates. Even the plunder of mineral resources in the seemingly infinite crust is getting harder, only a fleeting century or so into our spree. Sustaining present levels for even a few more centuries is a dubious (i.e., unsubstantiated) proposition. It is practically absurd to imagine sustaining present practices for 10,000 years. Humans simply have not yet demonstrated an ability to maintain a technological society without utter reliance on grossly unsustainable inheritance spending.
4. Climate change is accelerating and causing disruption in many sectors, threatening to end the stability of the Holocene that coincides with all of human civilization. Oceans are acidifying and corals are giving up the ghost, the ripple effects from which could be catastrophic for the broader set of oceanic ecosystems. Changes are faster than evolution can track in terms of seasonal timing or adapting to new climate conditions. Plants do not easily migrate, and animals are often cut off by development to remain captive in disconnected islands of increasingly hostile habitat. It is very hard to predict the degree to which these changes could result in large scale ecosystem collapses and thereby pose an existential threat to our own survival. Even if we stopped emitting CO2 today—an absurdly unrealistic conjecture—the damage mounts as Earth’s oceans continue to warm and more ice melts, while the planet slowly coasts toward a new equilibrium bringing unknown hardships.
5. Renewable Energy is harder than fossil energy. Wind and solar installations are taking off, right? A look at Figure 7.8 in the textbook shows these two rocketing upward globally over the last several years. But the scale is still very small, and at the recent impressive rate of expansion would still take over 100 years to replace current (enormous) energy appetites. Also, beware of the fact that we go for the low-hanging fruit first, giving a distorted sense of broader suitability. Some folks at UC San Diego are evaluating ways to retire the campus’ methane-burning infrastructure for electricity, heating, and cooling—ideally generating and storing all its own renewable energy via solar. It’s very hard—both practically and economically. UCSD is an affluent land-rich campus in an affluent, progressive state in an affluent country; free of the political rancor typical of state and national governance; benefiting from guidance and leadership by sage academics rather than elected politicians; situated in a sunny and mild location; and not even trying to solve the thornier problems of transportation, shipping, or manufacturing. Yet it seems extremely unlikely that we can pull it off. If transitioning away from fossil fuels is prohibitive for UCSD, then who, exactly, could we expect to succeed in making a clean break to fossil-free renewable energy?
6. The Limits to Growth work was an early eye-opener that robust and ubiquitous dynamical modes like delayed negative feedback create conditions for overshoot and collapse. The contortions they had to execute in order to prevent a 21st century collapse illustrated just how “baked in” collapse could be. While no model should be interpreted literally, neither should we dismiss the top-level findings and the inherent warning that—at first blush—we run a serious risk of collapse. So far, our trajectory is still consistent with their nominal model case. The jury is still out, and I don’t like what the sneak peek implies.
7. We face an energy trap (Section 18.3 of the textbook), in that the ease and cheapness of fossil fuels will likely delay large-scale migration to renewable energy until declining availability of fossil energy forces our hand. But then we learn that a massive build-out of renewable technologies (panels, turbines, concrete, installation) takes a tremendous amount of energy that can’t be conjured (financed) like money. Redirecting diminishing energy flows into a new infrastructure results in available energy declining even more rapidly as a result, for the few decades it takes to accomplish a transition. Such a “voluntary” energy decline is politically difficult to initiate and maintain, which may bind us to a path toward reduced capacity and resource scarcity. Successful navigation, in other words, requires decade-scale sacrifices for a better “far” future outcome—not something we are particularly talented at accepting.
8. Resource wars seem likely, wasting an enormous amount of energy and resources on destructive, not constructive ends. As Earth’s inheritance of fossil energy and other material resources are plundered around the globe, the process will be geographically uneven in terms of where supply and demand exist. Figure 8.11 in the textbook illustrates this for oil: the largest consumers are not the ones possessing the largest reserves. Humankind’s historical predilection for war suggests a likelihood for forceful acquisition of critical supplies by powerful nations lacking adequate domestic resources. Other prosperous but resource-poor nations may object and decide to fight for access. Otherwise the aggressor, capturing vast supplies, becomes an unrivaled and literal superpower for the foreseeable future. Success requires global cooperation to protect ecosystems that know no political boundaries. Earth is an island in space, so we need an island mentality to survive: we’re all in this together. Past and present global relations, however, are better described by the word competition than by cooperation.
9. Earth has never in its history had to contend with 8 billion fire apes, intelligent enough to have leveraged power by exploiting and burning one-time resources. We now operate outside the bounds and protections of evolution: in breach of contract, without a map to success. What could possibly convince us that this fireworks show—which has not even come close to standing the test of time—can maintain anything like its current resource impact for the long haul? Humans have demonstrated convincingly that we can live in a primitive state for hundreds of thousands of years. Our present mode is a few-century flash, supported almost entirely by inheritance-spending. Arguing that we have found a new normal is a precarious position that I would not be eager to defend. Parties end. Fireworks shows end. Why would our flash be any different? It’s not just guesswork: what other outcome could result from rapid resource exploitation on a finite planet?
10. Are we problem solvers, or problem creators? Make a list of global problems we have created. The list might include: climate change; fossil fuel dependency; staggering inequality; habitat and species loss; desertification and salt build-up in agricultural lands—to name a few. Now make a list of global-scale problems we have solved. The ozone hole? Not convincingly, but at least holding steady now. Hunger? Energy? Pollution? Waste? Happiness? Population? Stabilized wilderness? I am not pretending that the human endeavor is devoid of improvements, like sanitation, health care, and tolerance (all to do with treating ourselves better, notice). But does it seem like global problems are fewer in number today than 100 years ago, or the reverse? A root problem is our sense that we are the dominant species on the planet and justified in prioritizing our needs over those of other elements of nature. Yet, a partnership is the only way to make it work long-term.
11. We’re the worst judges. We were all born during a fossil-fueled fireworks show unlike anything that ever happened on this planet. Given all the threads that argue for the temporary nature of this inheritance spending spree, we should at least seriously question default assumptions that tomorrow will be “bigger” than today. Having been born during the fireworks show, it is no surprise that we are collectively unable to appreciate what “normal” on this planet really looks like. People are either oblivious to the danger, or unable to discern credible concerns from specious alarmism.
12. People want stuff. We’re like ravens: “shiny” stuff appeals. Ultimate success means a truly sustainable lifestyle, which could well be materially poorer than today’s life, depending on population. How would we mitigate intrinsic individual desires to acquire more stuff (and power)? It may be a fundamental incompatibility in that evolution prepares self-motivated organisms looking out for their own prosperity. If a species develops “unfair” power advantages that were not part of the evolutionary script, the result may be destined to end poorly as that species uses its discovered power to damage ecosystems beyond repair—ultimately only harming themselves.
13. Most of what we do today promotes failure, not success. Given that long term success requires a humble partnership with the life support machine we call the biosphere, most activities today serve to hack it down rather then preserve or build it back up. Economic constructs like the discount rate explicitly devalue the future, which points us in the direction of maximal exploitation for short-term gain—to the obvious detriment of nature and thus our own life support. In other words, we let financial decisions drive the planet, and that system is not based on values and principles that promote long term sustainability (a.k.a. success). We should not be surprised if that train—whose engine is often explicitly counterproductive to ecosystem health—fails to deliver a viable future.
14. We’re attracted to the amazing. The unquestioned narrative of our time is of endless and accelerating technological breakthroughs. Since this seems to have been the case for several generations, it is considered to be a constant of the human condition. But how could we be so easily fooled? It is not that hard to see the error in the story by imagining a person living around 1900 suddenly transported to 1960, while another from 1960 is popped into 2020. Which person sees more unrecognizable “magic” all around? Cars, planes, radios, televisions, computers, nuclear power, all manner of household appliances like refrigerators and washing machines came into widespread use across the first interval. But what would the 1960 person be confused by? Microwave ovens would be new. Computers and phones advanced impressively, but not beyond recognition. A citizen of 1960 would correctly guess that the rectangle held to your cheek is a dumb-looking phone whose wire has been replaced by radio communication: not magic. So are we really accelerating? Is the next 60 years going to bring back the magic, or is that phase mostly done now? Challenge your assumptions. Snap out of the maladaptive stories we tell ourselves.
15. One of those stories is that we’re just great. Human intelligence has paved the way for many very impressive accomplishments—no doubt. It is easy to be inspired—as I am—by some of our capstone achievements. But this breeds a certain self-congratulatory faith in human capabilities, and a hubristic sense that we can outsmart nature and “do nature” better than even it does. Consider that our perception is skewed by having witnessed the easy half of modern history. As we expanded from 1 billion to 8 billion people on the planet, we executed an unprecedented smash-and-grab of earth’s resources—largely unconstrained and even rewarded for the speed and efficiency with which we could carry it out. We devised political and economic systems to maximize material gain (almost always translating to a loss on nature’s side of the books, by the way). How will we fare when the fortunes reverse: when demand outstrips supply? Let’s not pat ourselves on the back just yet. Any fool can spend down the inheritance in an extravagant party. The real test is getting over the hangover and buckling down to a real job for the duration. So far, it’s been child’s play.
16. Space fantasies are alluringly alarming. They’re like reverse mortgages, attracting rafts of seemingly sane individuals, lured by Tom Selleck’s moustache. It’s a trap, people! As exciting as it is to think about, fueling imagination in an otherwise “boring” reality, it’s simply impractical to a degree that entertainment fails to convey. Space ambitions promote collapse in three ways. First, it’s an enormously intense mis-allocation of precious resources that just dig our hole deeper for no meaningful reward other than stoking fantasies. Second, promoting space as a viable escape hatch from earthly woes is a form of denial that defeats what might otherwise be an appropriate “immune system” response to the threat of collapse (thus, akin to an auto-immune disease). Finally, it may serve as a window into irrational human responses to real challenges. If we’re so easily misled in this domain, how can we have confidence that we’ll approach other aspects of collapse threats soberly and realistically?
17. Show me, don’t theorize. A key bottleneck is that many people have a hard time accepting a challenge to the prevailing narrative, when the view out the window looks fine. (This relates to personality types, discussed in Section 18.1 of the textbook.) To discuss global collapse of civilization is by definition discussing the unprecedented. That’s hard to swallow. History is of limited use. Direct experience offers little value. Getting one’s head around it requires a mode of thinking and synthesizing that is hard and unfamiliar to many. Going against prevailing attitudes and persistent narratives is even harder. As social animals, we take cues from those around us. It’s hard for many to stick their necks out and be different. It’s isolating. Honestly, without the language of math and science, I can’t imagine I would ever find enough conviction to buck the norms. But these tools are invaluable in poking into the future, where history runs out. Few individuals are equipped with well-honed tools of this sort, though.
18. We tend to avoid blame. It is impossible to entertain the idea of collapse without connecting the fact that your own actions as a member of society are contributing: that you are partly responsible. That’s a heavy load to bear, and it torments me personally. A tempting way out is to deny the likelihood of any such collapse—which turns out to be pretty easy to do.
19. We’ve been conditioned to ignore. From stories of Chicken Little (“The Sky is Falling”) to the Boy Who Cried Wolf (recall, the wolf did come, though), we are taught to ignore ever-present prognosticators of doom. A long time ago, I asked a friend why he would not at least turn the car onto a new path if a road sign said “cliff ahead.” His response was that he’s seen the same sign all his life and it hasn’t been true yet. Years later, I finally have a retort: but now it’s scientists who are holding up the sign.
20. Dangerous Denial. Perhaps the most heart-wrenching of my concerns over potential collapse—already mentioned a few times in this post—is the degree to which the notion is too unpopular or radical to discuss, for many. Because of this tendency, many have not honestly confronted the possibility and run through considerations like the ones outlined above. And, of course, failing to acknowledge the possibility is one of the surest ways to fall victim to this fate. It’s a self-unfulfilling prophecy: the very act of “predicting” it won’t happen is the thing that makes it most likely to happen. I would much rather that we are all talking about collapse and devising explicit global strategies to avoid that outcome. The core goal of most people warning of collapse is to be proven wrong, ultimately.
21. If we don’t heed these concerns, it seems the likely outcome is overshoot; collapse; failure. Even if we did collectively get serious about a bold new trajectory, it’s still far from easy. So what, exactly, would stop us from overshoot, over-spending the inheritance, and damaging ecosystems beyond their ability to recover? Related to the previous point, it seems unlikely that we would stop by accident or dumb luck, but only out of awareness and recognition. Please forgive me if the current global political climate does not inspire confidence.
Remember, any of these elements in isolation may not commit us to collapse, per se. But we don’t get to choose one element at a time—whack-a-mole style—or call for a timeout: they all operate simultaneously, and nature will not be a forgiving referee or listen to our howling protests of “no fair.” Hold it all in your head, if you can. Then do something about it!
Conflicting Views
I have been grappling with these sets of concerns for a long while now, and keep looking for ways to stop worrying. The arguments I typically hear downplaying the threat often amount to steadfast faith in humanity (amazingly effective spenders of the inheritance that we are) to prevail over any challenge. I hear much less in the way of specific reasons why the suite of fundamental elements can be ignored or are wrong. The arguments usually aren’t on that plane, and thus to me lack substance.
One potentially revealing tendency I have witnessed is that those arguing against the likelihood of collapse will accuse the ones warning of the danger as wanting collapse, or at least eager to believe in collapse. My head explodes with multiple simultaneous thoughts. First, I can’t speak for everyone, but my sense is that the motivation behind even engaging in this unpopular conversation is to promote avoidance of collapse. If you believe collapse is likely and actually want that outcome, the best way to promote an ultimate crash is to keep quiet about it. Hey, maybe the collapse dismissers actually secretly want collapse and are trying to divert any attention away from our crash-bound trajectory. Just kidding, but it’s fun to turn the tables.
Second, that’s not how this stuff works. Practicing scientists don’t first decide what they want to be true and then make the experiment fit. That’s soooo middle-school science fair. But it may be a window into the motivation behind collapse dismissers. Perhaps the fact that they don’t want collapse to manifest (who the hell does?!) becomes the foundation of their resistance. Then, having some awareness of that motivation in themselves, they may naturally assume (project) that anyone arguing the opposite must therefore want the opposite, deplorable outcome.
Third, a feedback dynamic can arise that would make it seem like the person warning of collapse might be emotionally invested in being proven right, and it goes like this. The idea of collapse is proffered. A strong opposition freaks the profferrer out because if we can’t acknowledge collapse as a viable possibility, it’s that much scarier and likely. So the arguments escalate and take on a desperate tenor. It would be easy to confuse the unspoken, underlying emotional reaction of “why don’t you see this as a problem?” and/or “your denial is exactly why this is an existential problem” as “I desperately want to be right about this.” How would you know the difference? If the exchange becomes antagonistic enough (a human specialty), it is not an uncommon reaction for the collapse-warner to spitefully want the disastrous scenario to play out just to witness the collapse-dismisser suffer with the rest of us and finally admit in their ruin that they didn’t have the answers. Oh, the look on their face! I told you so! That’s an unfortunate personal thing, not a genuine desire to see humanity go down in flames. But to the recipient of the ill-wisher, it can all look the same: this cat wants collapse.
One way to probe underlying sentiments of the person warning of collapse (I’m being careful not to say pro-collapse person, because such a misnomer is sort-of the whole point) is to say: “Hmm, I see why you are concerned. That would be a very bad outcome indeed. What do you think we should do to prevent it?” My prediction is that the person relaxes, visibly relieved, and starts talking in earnest about the elements and barriers to be addressed. Then you know where their heart lies. Or you may encounter something closer to depression if the person has little hope left that collapse can still be avoided and laments the seemingly inevitable loss. Just consider, though: they may be right! How can you claim to know the answer any better than they do?
On the other hand, maybe the individuals dismissing concerns of collapse are right. Smart people may be able to imagine some form of success, but the question is less about how it could go in someone’s mind than about how it will go in the human free-for-all in which we find ourselves. Granted, we’ve got a lot riding on this, and virtually no one wants to see collapse. So we’ll fight tooth and nail to prevent a crash if it becomes a clear and present danger, and maybe if we’re lucky it’s not too late when the risk becomes apparent. My concern is that the tactics we use may be reasonably effective at delaying the result for several years at a time, commensurate with political terms. No one wants collapse on their watch. But kicking the can down the road is not a plan, just a delay.
Avoiding the Worst
The structural transformations that would be necessary to truly put off collapse indefinitely are enormous, and will not happen without first openly acknowledging that collapse is the likely result of inaction (i.e., of business as usual).
We would have to transform economies to stop or reverse growth, assess and adopt practices geared for long-term sustainability, prioritize nature over ourselves in deciding what activities are tolerated, and establish a global cooperative to live within our means for generation after generation. Since this will likely involve leaving “goodies” on the shelves, within easy reach but protected from exploitation, it is unclear whether we can even get there and maintain such an unprecedented level of self-control for thousands of years.
All the while, individual action should not be discounted. If feeling overwhelmed by the enormous challenge, forget about saving the planet and bring peace of mind to yourself by living more responsibly as a part of nature. Maybe others will notice and follow. Transformation won’t happen without change at the individual level. Chapter 20 of the textbook offers some (limited) guidance. I am also enjoying a book by Peter Kalmus called Being the Change that aligns quite well with my own perspective.
Until movement on such transformations becomes evident at individual and global scales, I will continue to worry about the real threat of collapse. We’ll have plenty of notice if the world gets serious, as the first step is widespread, open, honest communication. Thus, at present, we would appear to be in no danger of preventing collapse. Indeed, we are just now collapsing across the finish line of this marathon post. Just breathe.
Sunday, May 23, 2021
Gail Tverberg on our Hidden Energy Problem
How the World’s Energy Problem Has Been Hidden. Gail Tverberg, Our Finite World. May 4, 2021.
We live in a world where words are very carefully chosen. Companies hire public relations firms to give just the right “spin” to what they are saying. Politicians make statements which suggest that everything is going well. Newspapers would like their advertisers to be happy; they certainly won’t suggest that the automobile you purchase today may be of no use to you in five years.
I believe that what has happened in recent years is that the “truth” has become very dark. We live in a finite world; we are rapidly approaching limits of many kinds. For example, there is not enough fresh water for everyone, including agriculture and businesses. This inadequate water supply is now tipping over into inadequate food supply in quite a few places because irrigation requires fresh water. This problem is, in a sense, an energy problem, because adding more irrigation requires more energy supplies used for digging deeper wells or making desalination plants. We are reaching energy scarcity issues not too different from those of World War I, World War II and the Depression Era between the wars.
We now live in a strange world filled with half-truths, not too different from the world of the 1930s. US newspapers leave out the many stories that could be written about rising food insecurity around the world, and even in the US. We see more reports of conflicts among countries and increasing gaps between the rich and the poor, but no one explains that such changes are to be expected when energy consumption per capita starts falling too low.
The majority of people seem to believe that all of these problems can be fixed simply by increasingly taxing the rich and using the proceeds to help the poor. They also believe that the biggest problem we are facing is climate change. Very few are even aware of the food scarcity problems occurring in many parts of the world already.
Our political leaders started down the wrong path long ago, when they chose to rely on economists rather than physicists. The economists created the fiction that the economy could expand endlessly, even with falling energy supplies. The physicists understood that the economy requires energy for growth, but didn’t really understand the financial system, so they weren’t in a position to explain which parts of economic theory were incorrect. Even as the true story becomes increasingly clear, politicians stick to their belief that our only energy problem is the possibility of using too much fossil fuel, with the result of rising world temperatures and disrupted weather patterns. This can be interpreted as a relatively distant problem that can be corrected over a fairly long future period.
In this post, I will explain why it appears to me that, right now, we are dealing with an energy problem as severe as that which seems to have led to World War I, World War II, and the Great Depression. We really need a solution to our energy problems right now, not in the year 2050 or 2100. Scientists modeled the wrong problem: a fairly distant energy problem which would be associated with high energy prices. The real issue is a very close-at-hand energy shortage problem, associated with relatively low energy prices. It should not be surprising that the solutions scientists have found are mostly absurd, given the true nature of the problem we are facing.
[1] There is a great deal of confusion with respect to which energy problem we are dealing with. Are we dealing with a near-at-hand problem featuring inadequate prices for producers or a more distant problem featuring high prices for consumers? It makes a huge difference in finding a solution, if any.
Business leaders would like us to believe that the problem to be concerned with is a fairly distant one: climate change. In fact, this is the problem most scientists are working on. There is a common misbelief that fossil fuel prices will jump to high levels if they are in short supply. These high prices will allow the extraction of a huge amount of coal, oil and natural gas from the ground. The rising prices will also allow high-priced alternatives to become competitive. Thus, it makes sense to start down the long road of trying to substitute “renewables” for fossil fuels.
If business leaders had stopped to look at the history of coal depletion, they would have discovered that expecting high prices when energy limits are encountered is incorrect. The issue that really happens is a wage problem: too many workers discover that their wages are too low. Indirectly, these low-wage workers need to cut back on purchases of goods of many types, including coal to heat workers’ homes. This loss of purchasing power tends to hold coal prices down to a level that is too low for producers. We can see this situation if we look at the historical problems with coal depletion in the UK and in Germany.
Coal played an outsized role in the time leading up to, and including, World War II.
Figure 1. Figure by author describing peak coal timing.
History shows that as early coal mines became depleted, the number of hours of labor required to extract a given amount of coal tended to rise significantly. This happened because deeper mines were needed, or mines were needed in areas where there were only thin coal seams. The problem owners of mines experienced was that coal prices did not rise enough to cover their higher labor costs, related to depletion. The issue was really that prices fell too low for coal producers.
Owners of mines found that they needed to cut the wages of miners. This led to strikes and lower coal production. Indirectly, other coal-using industries, such as iron production and bread baking, were adversely affected, leading these industries to cut jobs and wages, as well. In a sense, the big issue was growing wage disparity, because many higher-wage workers and property owners were not affected.
Today, the issue we see is very similar, especially when we look at wages worldwide, because markets are now worldwide. Many workers around the world have very low wages, or no wages at all. As a result, the number of workers worldwide who can afford to purchase goods that require large amounts of oil and coal products for their manufacture and operation, such as vehicles, tends to fall. For example, peak sales of private passenger automobile, worldwide, occurred in 2017. With fewer auto sales (as well as fewer sales of other high-priced goods), it is difficult to keep oil and coal prices high enough for producers. This is very similar to the problems of the 1914 to 1945 era.
Everything that I can see indicates that we are now reaching a time that is parallel to the period between 1914 and 1945. Conflict is one of the major things that a person would expect because each country wants to protect its jobs. Each country also wants to add new jobs that pay well.
In a period parallel to the 1914 to 1945 period, we can also expect pandemics. This happens because the many poor people often cannot afford adequate diets, making them more susceptible to diseases that are easily transmitted. In the Spanish Flu epidemic of 1918-1919, more than 50 million people worldwide died. The equivalent number with today’s world population would be about 260 million. This hugely dwarfs the 3.2 million COVID-19 deaths around the world that we have experienced to date.
[2] If we look at growth in energy supply, relative to the growth in population, precisely the same type of “squeeze” is occurring now as was occurring in the 1914 to 1945 period. This squeeze particularly affects coal and oil supplies.
Figure 2. The sum of red and blue areas on the chart represent average annual world energy consumption growth by 10-year periods. Blue areas represent average annual population growth percentages during these 10-year periods. The red area is determined by subtraction. It represents the amount of energy consumption growth that is “left over” for growth in people’s standards of living. Chart by Gail Tverberg using energy data from Vaclav Smil’s estimates shown in Energy Transitions: History, Requirements and Prospects, together with BP Statistical Data for 1965 and subsequent years.
The chart above is somewhat complex. It looks at how quickly energy consumption has been growing historically, over ten-year periods (sum of red and blue areas). This amount is divided into two parts. The blue area shows how much of this growth in energy consumption was required to provide food, housing and transportation to the growing world population, based on the standards at that time. The red area shows how much growth in energy consumption was “left over” for growth in the standard of living, such as better roads, more vehicles, and nicer homes. Note that GDP growth is not shown in the chart. It likely corresponds fairly closely to total energy consumption growth.
Figure 3, below, shows energy consumption by type of fuel between 1820 and 2010. From this, it is clear that the world’s energy consumption was tiny back in 1820, when most of the world’s energy came from burned biomass. Even at that time, there was a huge problem with deforestation.
Figure 3. World Energy Consumption by Source, based on Vaclav Smil estimates from Energy Transitions: History, Requirements and Prospects and together with BP’s Statistical Review of World Energy data for 1965 and subsequent years. (Wind and solar are included with biofuels.)
Clearly, the addition of coal, starting shortly after 1820, allowed huge changes in the world economy. But by 1910, this growth in coal consumption was flattening out, leading quite possibly to the problems of the 1914-1945 era. The growth in oil consumption after World War II allowed the world economy to recover. Natural gas, hydroelectric and nuclear have been added in recent years, as well, but the amounts have been less significant than those of coal and oil.
We can see how coal and oil have dominated growth in energy supplies in other ways, as well. This is a chart of energy supplies, with a projection of expected energy supplies through 2021 based on estimates of the IEA’s Global Energy Review 2021.
Figure 4. World energy consumption by fuel. Data through 2019 based on information from BP’s Statistical Review of World Energy 2020. Amounts for 2020 and 2021 based on percentage change estimates from IEA’s Global Energy Review 2021.
Oil supplies became a problem in the 1970s. There was briefly a dip in the demand for oil supplies as the world switched from burning oil to the use of other fuels in applications where this could easily be done, such as producing electricity and heating homes. Also, private passenger automobiles became smaller and more fuel efficient. There has been a continued push for fuel efficiency since then. In 2020, oil consumption was greatly affected by the reduction in personal travel associated with the COVID-19 epidemic.
Figure 4, above, shows that world coal consumption has been close to flat since about 2012. This is also evident in Figure 5, below.
Figure 5. World coal production by part of the world, based on data of BP’s Statistical Review of World Energy, 2020.
Figure 5 shows that coal production for the United States and Europe has been declining for a very long time, since about 1988. Before China joined the World Trade Organization (WTO) in 2001, its coal production grew at a moderate pace. After joining the WTO in 2001, China’s coal production grew very rapidly for about 10 years. In about 2011, China’s coal production leveled off, leading to the leveling of world coal production.
Figure 6 shows that recently, growth in the sum of oil and coal consumption has been lagging total energy consumption.
Figure 6. Three-year average annual increase in oil and coal consumption versus three-year average increase in total energy consumption, based on a combination of BP data through 2019 from BP’s Statistical Review of World Energy, 2010 and IEA’s 2020 and 2021 percentage change forecasts, from its Global Energy Review 2021.
We can see from Figure 6 that the only recent time when oil and coal supplies grew faster than energy consumption in total was during a brief period between 2002 and 2007. More recently, oil and coal consumption has been increasingly lagging total energy consumption. For both coal and oil, the problem has been that low prices for producers cause producers to voluntarily drop out of coal or oil production. The reason for this is two-fold: (1) With less oil (or coal) production, perhaps prices might rise, making production more profitable, and (2) Unprofitable oil (or coal) production isn’t really satisfactory for producers.
When determining the required level of profitability for these fuels, there is a need to include the tax revenue that governments require in order to maintain adequate services. This is especially the case with oil exporters, but it is also true in general. Energy products, to be useful, produce an energy surplus that can be used to benefit the rest of the economy. The way that this energy surplus can be transferred to the rest of the economy is by paying relatively high taxes. These taxes allow changes that aid economic growth, such as improvements in roads and schools.
If energy prices are chronically too low (so that an energy product requires a subsidy, rather than paying taxes), this is a sign that the energy product is most likely an energy “sink.” Such a product acts in the direction of pulling the economy down through ever-lower productivity.
[3] Governments have chosen to focus on preventing climate change because, in theory, the changes that are needed to prevent climate change seem to be the same ones needed to cover the contingency of “running out.” The catch is that the indicated changes don’t really work in the scarcity situation we are already facing.
It turns out that the very fuels that we seem to be running out of (coal and oil) are the very ones most associated with high carbon dioxide emissions. Thus, focusing on climate change seems to please everyone. Those who were concerned that we could keep extracting fossil fuels for hundreds of years and, because of this, completely ruin the climate, would be happy. Those who were concerned about running out of fossil fuels would be happy, as well. This is precisely the kind of solution that politicians prefer.
The catch is that we used coal and oil first because, in a very real sense, they are the “best” fuels for our needs. All of the other fuels, even natural gas, are in many senses inferior. Natural gas has the problem that it is very expensive to transport and store. Also, methane, which makes up the majority of natural gas, is itself a gas that contributes to global warming. It tends to leak from pipelines and from ships attempting to transport it. Thus, it is doubtful that it is much better from a global warming perspective than coal or oil.
So-called renewable fuels tend to be very damaging to the environment in ways other than CO2 emissions. This point is made very well in the new book Bright Green Lies by Derrick Jensen, Lierre Keith and Max Wilbert. It makes the point that renewable fuels are not an attempt to save the environment. Instead, they are trying to save our current industrial civilization using approaches that tend to destroy the environment. Cutting down forests, even if new trees are planted in their place, is especially detrimental. Alice Friedemann, in her new book, Life after Fossil Fuels: A Reality Check on Alternative Fuels, points out the high cost of these alternatives and their dependence on fossil fuel energy.
We are right now in a huge scarcity situation which is starting to cause conflicts of many kinds. Even if there were a way of producing these types of alternative energy cheaply enough, they are coming far too late and in far too small quantities to make a difference. They also don’t match up with our current coal and oil uses, adding a layer of time and expense for conversion that needs to be included in any model.
[4] What we really have is a huge conflict problem due to inadequate energy supplies for today’s world population. The powers that be are trying to hide this problem by publishing only their preferred version of the truth.
The situation that we are really facing is one that often goes under the name of “collapse.” It is a problem that many civilizations have faced in the past when a given population has outgrown its resource base.
Needless to say, the issue of collapse is not a story any politician wants to tell its citizens. Instead, we are told over and over, “Everything is fine. Any energy problem will be handled by the solutions scientists are finding.” The catch is that scientists were not told the correct problem to solve. They were told about a distant problem. To make the problem easier to solve, high prices and subsidies seemed to be acceptable. The problem they were asked to solve is very different from our real energy problem today.
Many people think that taxing the rich and giving the proceeds to the poor can solve our problem, but this doesn’t really solve the problem for a couple of reasons. One of the issues is that our scarcity issue is really a worldwide problem. Higher taxation of the rich in a few rich countries does nothing for the many problems of poor people in countries such as Lebanon, Yemen, Venezuela and India. Furthermore, taking money from the rich doesn’t really fix scarcity problems. Rich people don’t really eat a vastly disproportionate amount of food or drink more water, for example.
A detail that most of us don’t think about is that the military of many different countries has been very much aware of the potential conflict situation that is now occurring. They are aware that a “hot war” would require huge use of fossil fuel energy, so they have been trying to find alternative approaches. One approach military groups have been working on is the use of bioweapons of various kinds. In fact, some groups might even contemplate starting a pandemic. Another approach that might be used is computer viruses to disrupt the systems of other countries.
Needless to say, the powers that be do not want the general population to hear about issues of these kinds. We find ourselves with narrower and narrower news reports that provide only the version of the truth that politicians and news media want us to read. Citizens who have developed the view, “All I need to do to find out the truth is read my home town newspaper,” are likely to encounter more and more surprises, as conflict situations escalate.
We live in a world where words are very carefully chosen. Companies hire public relations firms to give just the right “spin” to what they are saying. Politicians make statements which suggest that everything is going well. Newspapers would like their advertisers to be happy; they certainly won’t suggest that the automobile you purchase today may be of no use to you in five years.
I believe that what has happened in recent years is that the “truth” has become very dark. We live in a finite world; we are rapidly approaching limits of many kinds. For example, there is not enough fresh water for everyone, including agriculture and businesses. This inadequate water supply is now tipping over into inadequate food supply in quite a few places because irrigation requires fresh water. This problem is, in a sense, an energy problem, because adding more irrigation requires more energy supplies used for digging deeper wells or making desalination plants. We are reaching energy scarcity issues not too different from those of World War I, World War II and the Depression Era between the wars.
We now live in a strange world filled with half-truths, not too different from the world of the 1930s. US newspapers leave out the many stories that could be written about rising food insecurity around the world, and even in the US. We see more reports of conflicts among countries and increasing gaps between the rich and the poor, but no one explains that such changes are to be expected when energy consumption per capita starts falling too low.
The majority of people seem to believe that all of these problems can be fixed simply by increasingly taxing the rich and using the proceeds to help the poor. They also believe that the biggest problem we are facing is climate change. Very few are even aware of the food scarcity problems occurring in many parts of the world already.
Our political leaders started down the wrong path long ago, when they chose to rely on economists rather than physicists. The economists created the fiction that the economy could expand endlessly, even with falling energy supplies. The physicists understood that the economy requires energy for growth, but didn’t really understand the financial system, so they weren’t in a position to explain which parts of economic theory were incorrect. Even as the true story becomes increasingly clear, politicians stick to their belief that our only energy problem is the possibility of using too much fossil fuel, with the result of rising world temperatures and disrupted weather patterns. This can be interpreted as a relatively distant problem that can be corrected over a fairly long future period.
In this post, I will explain why it appears to me that, right now, we are dealing with an energy problem as severe as that which seems to have led to World War I, World War II, and the Great Depression. We really need a solution to our energy problems right now, not in the year 2050 or 2100. Scientists modeled the wrong problem: a fairly distant energy problem which would be associated with high energy prices. The real issue is a very close-at-hand energy shortage problem, associated with relatively low energy prices. It should not be surprising that the solutions scientists have found are mostly absurd, given the true nature of the problem we are facing.
[1] There is a great deal of confusion with respect to which energy problem we are dealing with. Are we dealing with a near-at-hand problem featuring inadequate prices for producers or a more distant problem featuring high prices for consumers? It makes a huge difference in finding a solution, if any.
Business leaders would like us to believe that the problem to be concerned with is a fairly distant one: climate change. In fact, this is the problem most scientists are working on. There is a common misbelief that fossil fuel prices will jump to high levels if they are in short supply. These high prices will allow the extraction of a huge amount of coal, oil and natural gas from the ground. The rising prices will also allow high-priced alternatives to become competitive. Thus, it makes sense to start down the long road of trying to substitute “renewables” for fossil fuels.
If business leaders had stopped to look at the history of coal depletion, they would have discovered that expecting high prices when energy limits are encountered is incorrect. The issue that really happens is a wage problem: too many workers discover that their wages are too low. Indirectly, these low-wage workers need to cut back on purchases of goods of many types, including coal to heat workers’ homes. This loss of purchasing power tends to hold coal prices down to a level that is too low for producers. We can see this situation if we look at the historical problems with coal depletion in the UK and in Germany.
Coal played an outsized role in the time leading up to, and including, World War II.
Figure 1. Figure by author describing peak coal timing.
History shows that as early coal mines became depleted, the number of hours of labor required to extract a given amount of coal tended to rise significantly. This happened because deeper mines were needed, or mines were needed in areas where there were only thin coal seams. The problem owners of mines experienced was that coal prices did not rise enough to cover their higher labor costs, related to depletion. The issue was really that prices fell too low for coal producers.
Owners of mines found that they needed to cut the wages of miners. This led to strikes and lower coal production. Indirectly, other coal-using industries, such as iron production and bread baking, were adversely affected, leading these industries to cut jobs and wages, as well. In a sense, the big issue was growing wage disparity, because many higher-wage workers and property owners were not affected.
Today, the issue we see is very similar, especially when we look at wages worldwide, because markets are now worldwide. Many workers around the world have very low wages, or no wages at all. As a result, the number of workers worldwide who can afford to purchase goods that require large amounts of oil and coal products for their manufacture and operation, such as vehicles, tends to fall. For example, peak sales of private passenger automobile, worldwide, occurred in 2017. With fewer auto sales (as well as fewer sales of other high-priced goods), it is difficult to keep oil and coal prices high enough for producers. This is very similar to the problems of the 1914 to 1945 era.
Everything that I can see indicates that we are now reaching a time that is parallel to the period between 1914 and 1945. Conflict is one of the major things that a person would expect because each country wants to protect its jobs. Each country also wants to add new jobs that pay well.
In a period parallel to the 1914 to 1945 period, we can also expect pandemics. This happens because the many poor people often cannot afford adequate diets, making them more susceptible to diseases that are easily transmitted. In the Spanish Flu epidemic of 1918-1919, more than 50 million people worldwide died. The equivalent number with today’s world population would be about 260 million. This hugely dwarfs the 3.2 million COVID-19 deaths around the world that we have experienced to date.
[2] If we look at growth in energy supply, relative to the growth in population, precisely the same type of “squeeze” is occurring now as was occurring in the 1914 to 1945 period. This squeeze particularly affects coal and oil supplies.
Figure 2. The sum of red and blue areas on the chart represent average annual world energy consumption growth by 10-year periods. Blue areas represent average annual population growth percentages during these 10-year periods. The red area is determined by subtraction. It represents the amount of energy consumption growth that is “left over” for growth in people’s standards of living. Chart by Gail Tverberg using energy data from Vaclav Smil’s estimates shown in Energy Transitions: History, Requirements and Prospects, together with BP Statistical Data for 1965 and subsequent years.
The chart above is somewhat complex. It looks at how quickly energy consumption has been growing historically, over ten-year periods (sum of red and blue areas). This amount is divided into two parts. The blue area shows how much of this growth in energy consumption was required to provide food, housing and transportation to the growing world population, based on the standards at that time. The red area shows how much growth in energy consumption was “left over” for growth in the standard of living, such as better roads, more vehicles, and nicer homes. Note that GDP growth is not shown in the chart. It likely corresponds fairly closely to total energy consumption growth.
Figure 3, below, shows energy consumption by type of fuel between 1820 and 2010. From this, it is clear that the world’s energy consumption was tiny back in 1820, when most of the world’s energy came from burned biomass. Even at that time, there was a huge problem with deforestation.
Figure 3. World Energy Consumption by Source, based on Vaclav Smil estimates from Energy Transitions: History, Requirements and Prospects and together with BP’s Statistical Review of World Energy data for 1965 and subsequent years. (Wind and solar are included with biofuels.)
Clearly, the addition of coal, starting shortly after 1820, allowed huge changes in the world economy. But by 1910, this growth in coal consumption was flattening out, leading quite possibly to the problems of the 1914-1945 era. The growth in oil consumption after World War II allowed the world economy to recover. Natural gas, hydroelectric and nuclear have been added in recent years, as well, but the amounts have been less significant than those of coal and oil.
We can see how coal and oil have dominated growth in energy supplies in other ways, as well. This is a chart of energy supplies, with a projection of expected energy supplies through 2021 based on estimates of the IEA’s Global Energy Review 2021.
Figure 4. World energy consumption by fuel. Data through 2019 based on information from BP’s Statistical Review of World Energy 2020. Amounts for 2020 and 2021 based on percentage change estimates from IEA’s Global Energy Review 2021.
Oil supplies became a problem in the 1970s. There was briefly a dip in the demand for oil supplies as the world switched from burning oil to the use of other fuels in applications where this could easily be done, such as producing electricity and heating homes. Also, private passenger automobiles became smaller and more fuel efficient. There has been a continued push for fuel efficiency since then. In 2020, oil consumption was greatly affected by the reduction in personal travel associated with the COVID-19 epidemic.
Figure 4, above, shows that world coal consumption has been close to flat since about 2012. This is also evident in Figure 5, below.
Figure 5. World coal production by part of the world, based on data of BP’s Statistical Review of World Energy, 2020.
Figure 5 shows that coal production for the United States and Europe has been declining for a very long time, since about 1988. Before China joined the World Trade Organization (WTO) in 2001, its coal production grew at a moderate pace. After joining the WTO in 2001, China’s coal production grew very rapidly for about 10 years. In about 2011, China’s coal production leveled off, leading to the leveling of world coal production.
Figure 6 shows that recently, growth in the sum of oil and coal consumption has been lagging total energy consumption.
Figure 6. Three-year average annual increase in oil and coal consumption versus three-year average increase in total energy consumption, based on a combination of BP data through 2019 from BP’s Statistical Review of World Energy, 2010 and IEA’s 2020 and 2021 percentage change forecasts, from its Global Energy Review 2021.
We can see from Figure 6 that the only recent time when oil and coal supplies grew faster than energy consumption in total was during a brief period between 2002 and 2007. More recently, oil and coal consumption has been increasingly lagging total energy consumption. For both coal and oil, the problem has been that low prices for producers cause producers to voluntarily drop out of coal or oil production. The reason for this is two-fold: (1) With less oil (or coal) production, perhaps prices might rise, making production more profitable, and (2) Unprofitable oil (or coal) production isn’t really satisfactory for producers.
When determining the required level of profitability for these fuels, there is a need to include the tax revenue that governments require in order to maintain adequate services. This is especially the case with oil exporters, but it is also true in general. Energy products, to be useful, produce an energy surplus that can be used to benefit the rest of the economy. The way that this energy surplus can be transferred to the rest of the economy is by paying relatively high taxes. These taxes allow changes that aid economic growth, such as improvements in roads and schools.
If energy prices are chronically too low (so that an energy product requires a subsidy, rather than paying taxes), this is a sign that the energy product is most likely an energy “sink.” Such a product acts in the direction of pulling the economy down through ever-lower productivity.
[3] Governments have chosen to focus on preventing climate change because, in theory, the changes that are needed to prevent climate change seem to be the same ones needed to cover the contingency of “running out.” The catch is that the indicated changes don’t really work in the scarcity situation we are already facing.
It turns out that the very fuels that we seem to be running out of (coal and oil) are the very ones most associated with high carbon dioxide emissions. Thus, focusing on climate change seems to please everyone. Those who were concerned that we could keep extracting fossil fuels for hundreds of years and, because of this, completely ruin the climate, would be happy. Those who were concerned about running out of fossil fuels would be happy, as well. This is precisely the kind of solution that politicians prefer.
The catch is that we used coal and oil first because, in a very real sense, they are the “best” fuels for our needs. All of the other fuels, even natural gas, are in many senses inferior. Natural gas has the problem that it is very expensive to transport and store. Also, methane, which makes up the majority of natural gas, is itself a gas that contributes to global warming. It tends to leak from pipelines and from ships attempting to transport it. Thus, it is doubtful that it is much better from a global warming perspective than coal or oil.
So-called renewable fuels tend to be very damaging to the environment in ways other than CO2 emissions. This point is made very well in the new book Bright Green Lies by Derrick Jensen, Lierre Keith and Max Wilbert. It makes the point that renewable fuels are not an attempt to save the environment. Instead, they are trying to save our current industrial civilization using approaches that tend to destroy the environment. Cutting down forests, even if new trees are planted in their place, is especially detrimental. Alice Friedemann, in her new book, Life after Fossil Fuels: A Reality Check on Alternative Fuels, points out the high cost of these alternatives and their dependence on fossil fuel energy.
We are right now in a huge scarcity situation which is starting to cause conflicts of many kinds. Even if there were a way of producing these types of alternative energy cheaply enough, they are coming far too late and in far too small quantities to make a difference. They also don’t match up with our current coal and oil uses, adding a layer of time and expense for conversion that needs to be included in any model.
[4] What we really have is a huge conflict problem due to inadequate energy supplies for today’s world population. The powers that be are trying to hide this problem by publishing only their preferred version of the truth.
The situation that we are really facing is one that often goes under the name of “collapse.” It is a problem that many civilizations have faced in the past when a given population has outgrown its resource base.
Needless to say, the issue of collapse is not a story any politician wants to tell its citizens. Instead, we are told over and over, “Everything is fine. Any energy problem will be handled by the solutions scientists are finding.” The catch is that scientists were not told the correct problem to solve. They were told about a distant problem. To make the problem easier to solve, high prices and subsidies seemed to be acceptable. The problem they were asked to solve is very different from our real energy problem today.
Many people think that taxing the rich and giving the proceeds to the poor can solve our problem, but this doesn’t really solve the problem for a couple of reasons. One of the issues is that our scarcity issue is really a worldwide problem. Higher taxation of the rich in a few rich countries does nothing for the many problems of poor people in countries such as Lebanon, Yemen, Venezuela and India. Furthermore, taking money from the rich doesn’t really fix scarcity problems. Rich people don’t really eat a vastly disproportionate amount of food or drink more water, for example.
A detail that most of us don’t think about is that the military of many different countries has been very much aware of the potential conflict situation that is now occurring. They are aware that a “hot war” would require huge use of fossil fuel energy, so they have been trying to find alternative approaches. One approach military groups have been working on is the use of bioweapons of various kinds. In fact, some groups might even contemplate starting a pandemic. Another approach that might be used is computer viruses to disrupt the systems of other countries.
Needless to say, the powers that be do not want the general population to hear about issues of these kinds. We find ourselves with narrower and narrower news reports that provide only the version of the truth that politicians and news media want us to read. Citizens who have developed the view, “All I need to do to find out the truth is read my home town newspaper,” are likely to encounter more and more surprises, as conflict situations escalate.
Tim Morgan on Reality and the Route to Net Zero
#200. Other roads, part one. Tim Morgan, Surplus Energy Economics. May 22, 2021.
REALITY AND THE ROUTE TO NET ZERO
The release of a new policy document from the International Energy Agency marks a decisive stage in the evolution of the consensus around energy, the environment and the economy. Apart from anything else, Net Zero By 2050: A Roadmap for the Global Energy Sector reinforces the growing sense of commitment to a rapid transition away from reliance on climate-harming fossil fuels.
This policy paper confirms how closely the IEA is aligned with the broad thrust of policy intent in the United States, Britain and the European Union. Emerging economies like China and India might be harder to convince.
It would be easy to critique this document, applauding its ambition whilst questioning some of its methodologies and policy conclusions.
What matters much more, though, is the broad question of how we understand the interconnection between energy, the economy and the environment.
Granted that environmental risk is a function of our use of energy, are energy needs themselves a function of an economy that ‘grows’ according to its own, self-propelled, essentially financial and internal dynamic?
Or should the relationship be reversed, identifying economic prosperity as a subsidiary property of the use of energy?
From which direction?
It was pointed out to me recently that, whilst articles here make frequent reference to SEEDS, the meaning of this acronym is seldom explained. This is an omission based in familiarity and brevity, not reticence.
The short answer is that SEEDS – the Surplus Energy Economics Data System – is an economic model based on recognition that the economy is an energy dynamic. This means that it’s radically different from conventional models, which treat the economy as a wholly financial system.
This difference of approach may sound theoretical, but its practical implications could hardly be more far-reaching.
To illustrate, imagine that you’re trying to predict the future demand for some product or service. Conventionally, you’d do this by starting with GDP, and applying a forward rate of growth to calculate the size of the economy at some date in the future. With this as ‘a given’, you have the parameters or context for estimating the potential size of your market. What matters now is the potential expansion or contraction of demand for your product as a share of that broad context.
Your aim, of course, is practical rather than theoretical – you want to predict the scale and shape of the market for your product or service. You’re unlikely to be interested in the theory of economics itself, and are, in all probability, content to work within consensus methods, and arrive at consensus results. Even if your organization is big enough to employ its own economists, the probability is that this makes no real difference at all to the methodologies used, and very little difference to the resulting forecast.
Governments work in much the same way – they start by projecting, along conventional lines, the probable size of the national economy of the future, and only then assess the implications for the many aspects of policy.
The same approach is used for the forecasting of future energy requirements. All such conventional projections start with an assumption about the future size of the economy, and only then calculate what that is going to mean for energy needs. The near-unanimity of conventional forecasting right now is that the economy, meaning GDP, will grow at a trend rate of 3%.
Travelling to Net Zero
Hitherto, the resulting informed consensus around energy has been that, whilst renewable energy sources (REs) will capture an ever-increasing share of the energy market, the quantities of fossil fuels used will continue to increase. In contesting this, the IEA report applies a significantly new impetus to the direction of travel in the forecasting of future energy needs.
To be sure, there are differences between proposals and forecasts. Even so, the IEA’s Net Zero is an almost breathtakingly bold break from the prior consensus. It argues that rapid commitment to energy transition can, by 2050, deliver a world with zero net emissions of CO2.
In addition to massively increased investment in renewable sources of energy (REs), the IEA calls for the immediate cessation of all new oil and gas development projects. This amounts to an accelerated run-down of supplies of legacy energy from fossil fuel sources.
The pay-off, says the IEA, isn’t just the prevention of catastrophic degradation of the environment, but includes millions of new jobs and a big – and this time a more globally-inclusive – spurt of economic expansion.
You won’t be expecting me to agree that all of this is feasible, and I don’t. Let’s be clear, though, that the IEA, and others, are absolutely right to stress the need for transition away from climate-harming fossil fuels to REs.
Indeed, SEEDS analysis takes this imperative even further.
Environmentalists – whose ranks now include most Western governments, as well as organisations like the IEA – assert that continued reliance on fossil fuels risks inflicting irreparable harm to the environment.
Where SEEDS goes further is in arguing that, whilst continued fossil fuel dependency would probably wreck the environment, it would certainly destroy the economy.
The explanation for this is simple – it is that the cost of fossil fuel energy is rising, such that its net (post-cost) value is decreasing.
What this means is that the established sources of energy value that have powered the Industrial Age are fading away.
Thinking – forwards or backwards?
This brings us back to the critical issue of method. Instead of assuming a future economy of a given size, and then working backwards to the energy that this economy will require, SEEDS starts with energy projections, and only then asks what size of economy can be supported by the forward outlook for energy.
Consensus forward “growth” assumptions, typically 3%, are based on a supposedly cautious continuation of what are accepted as recent trends. These depict the economy, measured as GDP, as something capable of expanding at annual rates of between 3.25% and 3.75%.
That seems to check with stats showing that, between 1999 and 2019 – that is, in the twenty years before the coronavirus shock – annual increments to reported GDP averaged 3.6%.
What this ignores is that, over that same period, annual net borrowing averaged 10.4% of GDP. Unless you believe that the spending of newly-created purchasing power has no effect on the activity measured as GDP, then changes in GDP itself are linked to the rate at which credit expands.
Moreover, debt is by no means the only form of forward obligation whose expansion is linked to economic activity. Whilst each $1 of reported “growth” between 1999 and 2019 was accompanied by an increase of nearly $3 of debt, adding in the expansion of broader financial obligations lifts this ratio to well over $6 of new commitments for each dollar of “growth”.
As so often, the acid test for such varying interpretations is observation. If conventional data is right, global GDP increased by 110% between 1999 and 2019, whilst population numbers expanded by 26%. Even after a surprisingly modest fall (of -3.3%) in world GDP during crisis-hit 2020, output was still higher by 103% over a period (1999-2020) in which population growth was 27%.
This ought, surely, to mean that the economy is in far better shape now than it was back in 1999. Sharply higher prices for assets such as stocks and property seem to reinforce this optimistic reading.
But the economy as we observe it today doesn’t conform to this description.
Most obviously, we’re caught in a stimulus trap. If we carry on pouring gargantuan amounts of liquidity into the system, we face a very real risk of the hyperinflationary destruction of the value of money. But if we stop – or even scale back on – stimulus, asset prices would crash, and a cascade of defaults would ensue.
Can we square this observation of ‘fragility edging into crisis’ with the assurance that economic output has almost effortlessly out-grown population numbers over a very extended period?
The answer, of course, is that we can’t.
After all, if the economy had been performing as strongly as prior growth rates imply, why would we still be locked into a supposedly “temporary” and “emergency” reliance on negative real interest rates that began back in 2008-09?
We can’t, to any significant extent, put the blame for this on covid-19, not least because the official data itself puts the scale of the hit to the economy in 2020 at only -3.3%. At worst, then, we’ve lost a single year of the growth supposedly enjoyed during each of the twenty years preceding the pandemic.
The bottom line is that GDP stats are telling us one thing, and what we can see unfolding right in front of our eyes is the diametric opposite. On the one hand we have an economy that’s growing robustly – on the other, an economy dependent on the life-support of financial gimmickry, and trapped in a cul-de-sac from which there is no obvious route of escape.
Other roads
This is where alternative approaches are so important. To be clear, economic orthodoxy describes a robust economy that doesn’t exist, whilst policy orthodoxy is based on the continuation of positive trends which, it turns out, don’t exist either.
The SEEDS approach begins with three observations, familiar to regular readers and requiring only the briefest introduction for those for whom this is new.
First, the economy is an energy system, because literally everything which constitutes economic output is a product of the use of energy.
Second, whenever energy is accessed for our use, some of that energy is always consumed in the access process. This second principle establishes the role of the Energy Cost of Energy (ECoE), and divides the stream of energy and its associated economic value into “cost” (ECoE) and “profit” (surplus) components.
The third principle is that money has no intrinsic worth, but commands value only as a ‘claim’ on the products of the energy economy.
An economy stripped of money would have to resort to barter, or would have to create a replacement human artefact as a medium of exchange.
An economy stripped of energy, on the other hand, would, as of that moment, cease to exist.
These principles identify a dynamic which, though complex in application, is straightforward in principle. We use energy to create economic value. Some of this energy value has to be used in the energy access process itself. What remains powers all economic activity other than the supply of energy itself. ECoE is the factor which differentiates between economic output and material prosperity.
From this perspective – and in an economy which still derives four-fifths of its primary energy supply from oil, gas and coal – a critical trend has been the relentless rise in the ECoEs of fossil fuels.
This increase in ECoEs fits with observable trends, first by explaining the emergence (though not, in general, the accurate interpretation) of “secular stagnation” in the 1990s, and then by tracking the subsequent, crisis-strewn descent into that dependency on the credit and monetary gimmickry that has created the stimulus trap described earlier.
In short, what SEEDS interpretation says should happen as ECoEs rise coincides with what has happened as this trend has developed.
Feasible directions?
To resolve this issue, and to restore the capability for growth as well as minimising environmental harm, a transition to REs would need to accomplish two things.
First, it would need to provide a volumetric replacement for fossil fuels. This, unfortunately, is about as far as the conventional setting of targets usually goes.
Second, and critically, it would also need to drive overall, all-sources ECoEs back downwards.
For Western countries, successful ‘transition with growth’ would need, at a minimum, to drive overall ECoEs back below 5%, from a current global trend ECoE level of 9% and rising. For advanced economies, whose complexity involves high maintenance requirements in terms of ex-ECoE (surplus) energy, 5% is the upper ECoE parameter beyond which prior growth in prosperity goes into reverse.
Put another way, driving ECoEs down from 9% to 5% might be enough to forestall “de-growth”, but wouldn’t be low enough to reinstate growth itself. To achieve that, we’d need to push ECoEs down a lot further, probably to levels below 3.5%.
The volumetric side of the transition equation is tricky, and has been costed at between $95 trillion and $110tn. The financial price tag, of course, isn’t the issue, least of all in a world in which money is routinely conjured out of thin air. What matters is the quantity of material inputs which these sums represent.
Let’s assume, for purposes of hypothesis, that the Earth can supply the requisite amounts of raw materials necessary for the provision of inputs ranging from steel and copper to plastics, lithium and concrete.
As we know, accessing these materials and putting them to use is absolutely dependent on the use of energy. Without energy-intensive activity, we can’t even supply water, let alone extract minerals and convert them into components.
In short, the principle of ECoE – which applies, not just to the creation of capacity, but to its operation, maintenance and replacement as well – tells us that getting energy from RE sources at the scale that we require is absolutely dependent on the prior use of energy for these purposes.
Since, at least for the foreseeable future, the supply of these materials depends on legacy energy from fossil fuels, the ECoEs of renewables are linked to those of oil, gas and coal.
Identifying process
So here’s the equation that net zero combined with growth invites us to accept.
On the one hand, energy sourced from fossil fuels declines rapidly. On the other, physical products of energy – the inputs that we’ll need to expand RE supply dramatically – will become available in very large amounts.
Another way to put this is that we’re planning to abandon the sunk energy invested in the carbon infrastructure, and build a replacement infrastructure at global scale, and carry on driving, flying and doing everything else that we do with energy, at the same time as we’re driving down energy supply from legacy sources.
An obvious snag here is that nobody seems prepared to tell us what uses of energy will need to be relinquished in order to free up the resources needed for physical investment at a transformational scale.
If we free ourselves from the delusion that the economy is some kind of self-perpetuating, wholly-financial, perpetual-motion mechanism operating independently of energy, the only way to square this circle is to rely on indefinite cost reduction through continued progress in technology. This is why faith in the indefinite advance of technology is implicit in so many aspects of the ‘net-zero-without-economic-sacrifice’ narrative.
The problem with this is that it overlooks the reality, which is that the scope of technology is bounded by the physical parameters of the resource. This, of course, is why no amount of technology – or, for that matter, of financial commitment – has been able to use shale resources to turn the United States into “Saudi America”.
In addition to technological extrapolation to a point beyond the limits of physics, the critical snag with driving the ECoEs of REs downwards far enough is the fallacious assumption that, through some kind of internal financial dynamic, the economy can “grow”, of its own accord, to make all of the necessary transitional steps possible.
If we once accept the proposition that, whilst energy use falls, real economic output can rise, then we’re in danger of endorsing the fantasy that we can “de-couple” the economy from the use of energy. And, since we cannot produce anything of any economic utility at all without using energy, “de-coupling” is a logical impossibility.
From here
None of this is to say that we can’t, or shouldn’t, bend every effort to transition from fossil fuels to renewables. On the contrary, the transition to net zero goes far beyond the desirable, and into the imperative.
Far from contesting the necessity for transition, SEEDS establishes a compelling economic as well as an environmental case for endeavouring to do exactly that. An economy tied in perpetuity to the rising ECoEs of fossil fuels would face inexorable deterioration.
This isn’t a trend that we have to predict, because it’s beyond doubt that this is already happening.
Where SEEDS-based analysis parts company with the ‘new consensus’ is over the belief, amounting to an article of faith, that this process (a) can be accomplished without sacrifice, and (b) can be combined with economic growth.
Any given quantity of energy cannot be used more than once. Legacy energy value from fossil fuels, already a finite quantity, becomes a smaller finite quantity under plans to accelerate the abandonment of oil, gas and coal.
A situation in which this limited quantity of legacy energy is used to expand RE supply, and to build the requisite infrastructure, and to maintain current energy uses such as driving and flying, fails the test of practicality. The associated assumptions – that technology will provide a fix for everything, and that the economy ‘will carry on growing’ thanks to some kind of internal momentum – fail the test of logical interpretation.
All of this, of course, carries the obvious, if startling, implication that we’re trying to progress to a desirable destination using a basis of planning that’s demonstrably false.
The pace at which we should abandon the use of fossil fuel energy is a matter for debate.
But the need to abandon those fallacious, money-only methods of interpretation which create the myth of the economy as a perpetual-motion machine, growing ever larger through an internal mechanism disconnected from energy, has become imperative.
REALITY AND THE ROUTE TO NET ZERO
The release of a new policy document from the International Energy Agency marks a decisive stage in the evolution of the consensus around energy, the environment and the economy. Apart from anything else, Net Zero By 2050: A Roadmap for the Global Energy Sector reinforces the growing sense of commitment to a rapid transition away from reliance on climate-harming fossil fuels.
This policy paper confirms how closely the IEA is aligned with the broad thrust of policy intent in the United States, Britain and the European Union. Emerging economies like China and India might be harder to convince.
It would be easy to critique this document, applauding its ambition whilst questioning some of its methodologies and policy conclusions.
What matters much more, though, is the broad question of how we understand the interconnection between energy, the economy and the environment.
Granted that environmental risk is a function of our use of energy, are energy needs themselves a function of an economy that ‘grows’ according to its own, self-propelled, essentially financial and internal dynamic?
Or should the relationship be reversed, identifying economic prosperity as a subsidiary property of the use of energy?
From which direction?
It was pointed out to me recently that, whilst articles here make frequent reference to SEEDS, the meaning of this acronym is seldom explained. This is an omission based in familiarity and brevity, not reticence.
The short answer is that SEEDS – the Surplus Energy Economics Data System – is an economic model based on recognition that the economy is an energy dynamic. This means that it’s radically different from conventional models, which treat the economy as a wholly financial system.
This difference of approach may sound theoretical, but its practical implications could hardly be more far-reaching.
To illustrate, imagine that you’re trying to predict the future demand for some product or service. Conventionally, you’d do this by starting with GDP, and applying a forward rate of growth to calculate the size of the economy at some date in the future. With this as ‘a given’, you have the parameters or context for estimating the potential size of your market. What matters now is the potential expansion or contraction of demand for your product as a share of that broad context.
Your aim, of course, is practical rather than theoretical – you want to predict the scale and shape of the market for your product or service. You’re unlikely to be interested in the theory of economics itself, and are, in all probability, content to work within consensus methods, and arrive at consensus results. Even if your organization is big enough to employ its own economists, the probability is that this makes no real difference at all to the methodologies used, and very little difference to the resulting forecast.
Governments work in much the same way – they start by projecting, along conventional lines, the probable size of the national economy of the future, and only then assess the implications for the many aspects of policy.
The same approach is used for the forecasting of future energy requirements. All such conventional projections start with an assumption about the future size of the economy, and only then calculate what that is going to mean for energy needs. The near-unanimity of conventional forecasting right now is that the economy, meaning GDP, will grow at a trend rate of 3%.
Travelling to Net Zero
Hitherto, the resulting informed consensus around energy has been that, whilst renewable energy sources (REs) will capture an ever-increasing share of the energy market, the quantities of fossil fuels used will continue to increase. In contesting this, the IEA report applies a significantly new impetus to the direction of travel in the forecasting of future energy needs.
To be sure, there are differences between proposals and forecasts. Even so, the IEA’s Net Zero is an almost breathtakingly bold break from the prior consensus. It argues that rapid commitment to energy transition can, by 2050, deliver a world with zero net emissions of CO2.
In addition to massively increased investment in renewable sources of energy (REs), the IEA calls for the immediate cessation of all new oil and gas development projects. This amounts to an accelerated run-down of supplies of legacy energy from fossil fuel sources.
The pay-off, says the IEA, isn’t just the prevention of catastrophic degradation of the environment, but includes millions of new jobs and a big – and this time a more globally-inclusive – spurt of economic expansion.
You won’t be expecting me to agree that all of this is feasible, and I don’t. Let’s be clear, though, that the IEA, and others, are absolutely right to stress the need for transition away from climate-harming fossil fuels to REs.
Indeed, SEEDS analysis takes this imperative even further.
Environmentalists – whose ranks now include most Western governments, as well as organisations like the IEA – assert that continued reliance on fossil fuels risks inflicting irreparable harm to the environment.
Where SEEDS goes further is in arguing that, whilst continued fossil fuel dependency would probably wreck the environment, it would certainly destroy the economy.
The explanation for this is simple – it is that the cost of fossil fuel energy is rising, such that its net (post-cost) value is decreasing.
What this means is that the established sources of energy value that have powered the Industrial Age are fading away.
Thinking – forwards or backwards?
This brings us back to the critical issue of method. Instead of assuming a future economy of a given size, and then working backwards to the energy that this economy will require, SEEDS starts with energy projections, and only then asks what size of economy can be supported by the forward outlook for energy.
Put another way, SEEDS dismisses any notion of commencing with an assumed rate of growth in economic output. At the same time, the model also dismisses the idea that GDP is, or can be, a meaningful metric for economic prosperity.
Consensus forward “growth” assumptions, typically 3%, are based on a supposedly cautious continuation of what are accepted as recent trends. These depict the economy, measured as GDP, as something capable of expanding at annual rates of between 3.25% and 3.75%.
That seems to check with stats showing that, between 1999 and 2019 – that is, in the twenty years before the coronavirus shock – annual increments to reported GDP averaged 3.6%.
What this ignores is that, over that same period, annual net borrowing averaged 10.4% of GDP. Unless you believe that the spending of newly-created purchasing power has no effect on the activity measured as GDP, then changes in GDP itself are linked to the rate at which credit expands.
Moreover, debt is by no means the only form of forward obligation whose expansion is linked to economic activity. Whilst each $1 of reported “growth” between 1999 and 2019 was accompanied by an increase of nearly $3 of debt, adding in the expansion of broader financial obligations lifts this ratio to well over $6 of new commitments for each dollar of “growth”.
As so often, the acid test for such varying interpretations is observation. If conventional data is right, global GDP increased by 110% between 1999 and 2019, whilst population numbers expanded by 26%. Even after a surprisingly modest fall (of -3.3%) in world GDP during crisis-hit 2020, output was still higher by 103% over a period (1999-2020) in which population growth was 27%.
This ought, surely, to mean that the economy is in far better shape now than it was back in 1999. Sharply higher prices for assets such as stocks and property seem to reinforce this optimistic reading.
But the economy as we observe it today doesn’t conform to this description.
Most obviously, we’re caught in a stimulus trap. If we carry on pouring gargantuan amounts of liquidity into the system, we face a very real risk of the hyperinflationary destruction of the value of money. But if we stop – or even scale back on – stimulus, asset prices would crash, and a cascade of defaults would ensue.
Can we square this observation of ‘fragility edging into crisis’ with the assurance that economic output has almost effortlessly out-grown population numbers over a very extended period?
The answer, of course, is that we can’t.
After all, if the economy had been performing as strongly as prior growth rates imply, why would we still be locked into a supposedly “temporary” and “emergency” reliance on negative real interest rates that began back in 2008-09?
We can’t, to any significant extent, put the blame for this on covid-19, not least because the official data itself puts the scale of the hit to the economy in 2020 at only -3.3%. At worst, then, we’ve lost a single year of the growth supposedly enjoyed during each of the twenty years preceding the pandemic.
The bottom line is that GDP stats are telling us one thing, and what we can see unfolding right in front of our eyes is the diametric opposite. On the one hand we have an economy that’s growing robustly – on the other, an economy dependent on the life-support of financial gimmickry, and trapped in a cul-de-sac from which there is no obvious route of escape.
Other roads
This is where alternative approaches are so important. To be clear, economic orthodoxy describes a robust economy that doesn’t exist, whilst policy orthodoxy is based on the continuation of positive trends which, it turns out, don’t exist either.
The SEEDS approach begins with three observations, familiar to regular readers and requiring only the briefest introduction for those for whom this is new.
First, the economy is an energy system, because literally everything which constitutes economic output is a product of the use of energy.
Second, whenever energy is accessed for our use, some of that energy is always consumed in the access process. This second principle establishes the role of the Energy Cost of Energy (ECoE), and divides the stream of energy and its associated economic value into “cost” (ECoE) and “profit” (surplus) components.
The third principle is that money has no intrinsic worth, but commands value only as a ‘claim’ on the products of the energy economy.
An economy stripped of money would have to resort to barter, or would have to create a replacement human artefact as a medium of exchange.
An economy stripped of energy, on the other hand, would, as of that moment, cease to exist.
These principles identify a dynamic which, though complex in application, is straightforward in principle. We use energy to create economic value. Some of this energy value has to be used in the energy access process itself. What remains powers all economic activity other than the supply of energy itself. ECoE is the factor which differentiates between economic output and material prosperity.
From this perspective – and in an economy which still derives four-fifths of its primary energy supply from oil, gas and coal – a critical trend has been the relentless rise in the ECoEs of fossil fuels.
This increase in ECoEs fits with observable trends, first by explaining the emergence (though not, in general, the accurate interpretation) of “secular stagnation” in the 1990s, and then by tracking the subsequent, crisis-strewn descent into that dependency on the credit and monetary gimmickry that has created the stimulus trap described earlier.
In short, what SEEDS interpretation says should happen as ECoEs rise coincides with what has happened as this trend has developed.
Feasible directions?
To resolve this issue, and to restore the capability for growth as well as minimising environmental harm, a transition to REs would need to accomplish two things.
First, it would need to provide a volumetric replacement for fossil fuels. This, unfortunately, is about as far as the conventional setting of targets usually goes.
Second, and critically, it would also need to drive overall, all-sources ECoEs back downwards.
For Western countries, successful ‘transition with growth’ would need, at a minimum, to drive overall ECoEs back below 5%, from a current global trend ECoE level of 9% and rising. For advanced economies, whose complexity involves high maintenance requirements in terms of ex-ECoE (surplus) energy, 5% is the upper ECoE parameter beyond which prior growth in prosperity goes into reverse.
Put another way, driving ECoEs down from 9% to 5% might be enough to forestall “de-growth”, but wouldn’t be low enough to reinstate growth itself. To achieve that, we’d need to push ECoEs down a lot further, probably to levels below 3.5%.
The volumetric side of the transition equation is tricky, and has been costed at between $95 trillion and $110tn. The financial price tag, of course, isn’t the issue, least of all in a world in which money is routinely conjured out of thin air. What matters is the quantity of material inputs which these sums represent.
Let’s assume, for purposes of hypothesis, that the Earth can supply the requisite amounts of raw materials necessary for the provision of inputs ranging from steel and copper to plastics, lithium and concrete.
As we know, accessing these materials and putting them to use is absolutely dependent on the use of energy. Without energy-intensive activity, we can’t even supply water, let alone extract minerals and convert them into components.
In short, the principle of ECoE – which applies, not just to the creation of capacity, but to its operation, maintenance and replacement as well – tells us that getting energy from RE sources at the scale that we require is absolutely dependent on the prior use of energy for these purposes.
Since, at least for the foreseeable future, the supply of these materials depends on legacy energy from fossil fuels, the ECoEs of renewables are linked to those of oil, gas and coal.
Identifying process
So here’s the equation that net zero combined with growth invites us to accept.
On the one hand, energy sourced from fossil fuels declines rapidly. On the other, physical products of energy – the inputs that we’ll need to expand RE supply dramatically – will become available in very large amounts.
Another way to put this is that we’re planning to abandon the sunk energy invested in the carbon infrastructure, and build a replacement infrastructure at global scale, and carry on driving, flying and doing everything else that we do with energy, at the same time as we’re driving down energy supply from legacy sources.
An obvious snag here is that nobody seems prepared to tell us what uses of energy will need to be relinquished in order to free up the resources needed for physical investment at a transformational scale.
If we free ourselves from the delusion that the economy is some kind of self-perpetuating, wholly-financial, perpetual-motion mechanism operating independently of energy, the only way to square this circle is to rely on indefinite cost reduction through continued progress in technology. This is why faith in the indefinite advance of technology is implicit in so many aspects of the ‘net-zero-without-economic-sacrifice’ narrative.
The problem with this is that it overlooks the reality, which is that the scope of technology is bounded by the physical parameters of the resource. This, of course, is why no amount of technology – or, for that matter, of financial commitment – has been able to use shale resources to turn the United States into “Saudi America”.
In addition to technological extrapolation to a point beyond the limits of physics, the critical snag with driving the ECoEs of REs downwards far enough is the fallacious assumption that, through some kind of internal financial dynamic, the economy can “grow”, of its own accord, to make all of the necessary transitional steps possible.
If we once accept the proposition that, whilst energy use falls, real economic output can rise, then we’re in danger of endorsing the fantasy that we can “de-couple” the economy from the use of energy. And, since we cannot produce anything of any economic utility at all without using energy, “de-coupling” is a logical impossibility.
From here
None of this is to say that we can’t, or shouldn’t, bend every effort to transition from fossil fuels to renewables. On the contrary, the transition to net zero goes far beyond the desirable, and into the imperative.
Far from contesting the necessity for transition, SEEDS establishes a compelling economic as well as an environmental case for endeavouring to do exactly that. An economy tied in perpetuity to the rising ECoEs of fossil fuels would face inexorable deterioration.
This isn’t a trend that we have to predict, because it’s beyond doubt that this is already happening.
Where SEEDS-based analysis parts company with the ‘new consensus’ is over the belief, amounting to an article of faith, that this process (a) can be accomplished without sacrifice, and (b) can be combined with economic growth.
Any given quantity of energy cannot be used more than once. Legacy energy value from fossil fuels, already a finite quantity, becomes a smaller finite quantity under plans to accelerate the abandonment of oil, gas and coal.
A situation in which this limited quantity of legacy energy is used to expand RE supply, and to build the requisite infrastructure, and to maintain current energy uses such as driving and flying, fails the test of practicality. The associated assumptions – that technology will provide a fix for everything, and that the economy ‘will carry on growing’ thanks to some kind of internal momentum – fail the test of logical interpretation.
All of this, of course, carries the obvious, if startling, implication that we’re trying to progress to a desirable destination using a basis of planning that’s demonstrably false.
The pace at which we should abandon the use of fossil fuel energy is a matter for debate.
But the need to abandon those fallacious, money-only methods of interpretation which create the myth of the economy as a perpetual-motion machine, growing ever larger through an internal mechanism disconnected from energy, has become imperative.
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