How then, do we move backwards? How does a society, with most of the people having no clue of future events, move from being dependent on a vast and intertwined network of goods and services produced by the indigenous people of whereever, to a local resource and renewable energy based society, and do so in the timeframe available (20-30 years using the most liberal extimates, 10-20 with resonable estimates, 5-10 with worst case scenarios), all the while prices on everything increasing, world politics getting more militaristic, governments continuously reducing civil liberties, shortages of goods on the market and weather patterns resembling bad Hollywood movies?
Posted: Wed Jul 16, 2008 7:08 pm Post subject: Re: Powering Down to Core Consumption
kublikhan wrote:
Also, energy intensity is continuing to decline in the present and will continue to decline in the future. Even if efficiency gains stopped tomorrow, energy intensity would continue to drop as older, less efficient devices are replaced with today's current batch of devices. Also, despite the US's gains, it is still on the energy hog side of efficiency. If you compare it to other nations, it still has a long way to go just to match where they are now, let alone gains they may make in the future.
What, exactly, do you mean by "energy intensity?"
Do you mean usage? If so, I think that the evidence is in: we are using more and more with each passing year.
Maybe you mean that energy usage would decrease in a perfect world, or in a laboratory, or on some planet not plagued by runaway consumption.
Posted: Wed Jul 16, 2008 8:11 pm Post subject: Re: Powering Down to Core Consumption
MonteQuest wrote:
yesplease wrote:
Read it again. I never said we needed energy for the growth of economic activity. I said we need energy for economic activity.
LOL! That's even more nonsensical.
Troll, the Hall of Flames awaits!
MonteQuest wrote:
We need energy for economic acivity, but we don't need it for the growth of economic activity.
I'm not sure what acivity is, but in any event, nice strawman troll! That isn't what I said. I said that we need energy for economic activity, but we don't always need more energy for more economic activity. We can and have seen an increase in economic activity w/o an increase in energy. _________________
Posted: Wed Jul 16, 2008 8:16 pm Post subject: Re: Powering Down to Core Consumption
You know, I think it's time use the ignore feature. No one wants to post admid your crap. _________________ A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
Live in Arizona? Check out: http://sustainablearizona.org and read my blog.
Joined: Sep 25, 2005 Posts: 1952 Location: Waiuku, New Zealand
Posted: Wed Jul 16, 2008 8:29 pm Post subject: Re: Powering Down to Core Consumption
kublikhan wrote:
TonyPrep wrote:
kublikhan wrote:
In the last 50 years, the amount of energy needed to make a unit of GDP fell by more than half
Wouldn't that imply that a unit decline in energy could now cause an even bigger drop in GDP. Why wouldn't it work both ways, efficiencies excluded?
No. If the consumption of oil per unit of GDP is higher in economy 1 than economy 2, than economy 1 is going to suffer more if oil doubles in price. This is because a larger section of their budget just doubled in price. Even thought economy 2 had its energy price double as well, it can absorb it better because it was a smaller share of the pie.
Also, energy intensity is continuing to decline in the present and will continue to decline in the future. Even if efficiency gains stopped tomorrow, energy intensity would continue to drop as older, less efficient devices are replaced with today's current batch of devices. Also, despite the US's gains, it is still on the energy hog side of efficiency. If you compare it to other nations, it still has a long way to go just to match where they are now, let alone gains they may make in the future.
Perhaps you misunderstood me. I wasn't talking about the effects of oil price hikes, and neither were you. You were suggesting that because energy intensity is lower now, GDP would decline more slowly than energy, once energy declines. But if 1 unit of energy produced 10 units of GDP (low intensity), why wouldn't a decline of 1 unit of energy result in a decline of 10 units of GDP (excluding efficiencies)?
To put it another way. Suppose economy A (perhaps our economy 30 years ago) uses 100 units of energy for 100% of its GDP and economy B (perhaps our current economy) uses 50 units of energy for 100% of its GDP. What happens to each economy's GDP if 10 units of energy are no longer available?
Posted: Wed Jul 16, 2008 11:03 pm Post subject: Re: Powering Down to Core Consumption
TonyPrep wrote:
Perhaps you misunderstood me. I wasn't talking about the effects of oil price hikes, and neither were you. You were suggesting that because energy intensity is lower now, GDP would decline more slowly than energy, once energy declines. But if 1 unit of energy produced 10 units of GDP (low intensity), why wouldn't a decline of 1 unit of energy result in a decline of 10 units of GDP (excluding efficiencies)?
To put it another way. Suppose economy A (perhaps our economy 30 years ago) uses 100 units of energy for 100% of its GDP and economy B (perhaps our current economy) uses 50 units of energy for 100% of its GDP. What happens to each economy's GDP if 10 units of energy are no longer available?
But oil price hikes is how we will see the shortage manifest itself. Example:
Cost of Oil is .25 units of GDP
Scenario 1:
50 units of oil for 100 units of GDP
oil bill = 12.5 units of GDP(1/8 of the economy goes to paying for oil import bill)
Scenario 2:
100 units of oil for 400 units of GDP
oil bill = 25 units of GDP(1/16 of the economy goes to paying for oil import bill)
Oil Price now doubles:
Cost of oil is .5 units of GDP
Scenario 1:
50 units of oil for 100 units of GDP
oil bill = 25 units of GDP(1/4 of the economy goes towards paying oil import bill)
Scenario 2:
100 units of oil for 400 units of GDP
oil bill = 50 units of GDP(1/8 of economy goes towards paying for oil import bill)
Even though Scenario 2 has a higher total oil bill, the proportion of that bill is a much smaller chunk of the entire economy, and thus an easier burden to bare. Easier, than scenario 1, but it is still a huge jump compared to what it was paying before the price of oil doubled. That is why I said the energy use will likely not stay at 100 units, but will instead drop. Not because the oil was unavailable to buy, but because they could not afford to buy it. So in the scenarios above, the proportional shortfall of oil would be higher in scenario 1 because scenario 2 can out bid scenario 1 for the oil, all other factors being equal.
zeke wrote:
kublikhan wrote:
Also, energy intensity is continuing to decline in the present and will continue to decline in the future. Even if efficiency gains stopped tomorrow, energy intensity would continue to drop as older, less efficient devices are replaced with today's current batch of devices. Also, despite the US's gains, it is still on the energy hog side of efficiency. If you compare it to other nations, it still has a long way to go just to match where they are now, let alone gains they may make in the future.
What, exactly, do you mean by "energy intensity?"
Do you mean usage? If so, I think that the evidence is in: we are using more and more with each passing year.
Maybe you mean that energy usage would decrease in a perfect world, or in a laboratory, or on some planet not plagued by runaway consumption.
zeke
I am not talking about a laboratory, Mars, or any fantasy scenarios. I am talking about what really happened in the history of the United States of America. No, I did not mean energy use. Here is a definition of energy intensity:
Quote:
Energy Intensity is measured by the quantity of energy required per unit output or activity, so that using less energy to produce a product reduces the intensity.
Posted: Thu Jul 17, 2008 12:52 am Post subject: Re: Powering Down to Core Consumption
So what was the "energy intensity" of pre-Big Oil Civilizations like the Babylonians, Mesopotamians and Egyptians? Or the other agricultural civilizations established in othe River Valleys in China and in India (still BTW the largest Populations Centers)?
Clearly Big Oil multiplied out our ability to produce, the energy involved in food production and transportation got hidden for a century because oil came fast and cheap during this period. So now its not coming so fast or so cheap, so the overall economy has to contract around that fact of life. What is an unanswered question here is just how fast the contraction happens, and in what form it happens?
Current financial markets are in turmoil, clearly the economy is shrinking around a lot of irredeemable debt, but how far does it have to shrink before the bust cycle turns to a mini-boom cycle? Not as big as the boom before the last bust, you are shrinking ever downward here but does it necessarily have to occur in one Big Bang?
Look at the trip UP the Peak Oil Curve. It was littered with Boom and Bust cycles. It took about 100 years to make the trip UP the Mountain, how fast will we make the trip DOWN the Mountain? Possible we got to the Top of the Mountain and there is a Cliff on the other side we can just fall of and go straight DOWN, very fast. However, based on the actions of the market, this does not seem likely right now. As production falls off, as unemployment increases, as people abandon negative equity mortgages in energy inefficient suburban homes, we end up using less oil, and so the production capacity we actually have is enough to support what we are doing, briefly anyhow. Look at it this way, 2 related families own two houses and 2 SUVS. One gets unemployed, and so they go move in with the Relatives, and carpool in the one SUV. Certainly going to be an adjustment in family living arrangements, but economically speaking you just cut in half the total costs in energy for the two families. Most of our suburban houses are way overbuilt for one family, heck 20 Chinese will move into one of these houses and find it spacious
This kind of adjustment is already taking place, at least in my community I see 1/4 of the properties for sale and more carpooling taking place, but not a real increase yet in Homelessness or people unable to get to work, if they still have a job in the shrinking economy anyhow. This lessens the demand on oil, and so inventories increase, which drives the price back down. Over time people adjust to a more crowded living environment and use up less energy per capita. You have at least the potential there for another mini-boom cyclet in the trip down the Peak Oil curve.
This type of cyclical economics tends to indicate that the trip back down off Peak Oil will take somewhere near the 100 years it took to climb the curve to begin with. Gradually decreasing the standard of living until the oil is truly gone for good, but maybe that 100 years gives time to readjust in energy intensity and utilize the knowledge gained in the trip up the curve to make life slightly better than it was in say 1750, before Oil came to rule the world and the Industrial Economy took over?
Clearly the world cannot support 6 Billion people in the absence of Oil. Without the Fertilizers and the portable fuel to run the tractors, just no way you could maintain the food production at the level it is right now. However, we probably could support somewhat more than the 1 Billion or so who lived on the Planet BEFORE Big Oil, utilizing the fruits of scientific research through that period. Genetic Engineering, Wind Farms, that sort of thing can be developed over a 100 year trip back down the mountain. So, say in 100 years you knock off 2/3 the population, that could occur mostly through a fairly natural die off by ageing up. Doesn't HAVE to be a catastrophic falloff in 10 years, though that certainly is a possibility.
Main problem for any individual here is how to negotiate the slide down the hill. No given profession is safe, and frankly not even Subsistence Farmers out in the Boonies are safe. Never know when the Local Police Chief might make his Cops a local Militia, Tax your Farm and if you don't cough up food for them to eat you get gunned down. Unless you happen to have an extraordinary amount of money that is NOT in danger of becoming Valueless in your Pension Fund or Stock Holdings, your ability to negotiate the trip down involves being mobile enough to move away from depressed areas and to take jobs that exist in any economy, even a shrinking one.
Some people ALWAYS survive disasters, its a combination of Luck and Planning. When Plagues and Famine hit the Egyptians, they didn't ALL die off. We all most probably will not die off this time either, unless too many Nukes get tossed around. Just a substantial number will die off, but it could take some time for this to occur. Meanwhile, you just have to position yourself as well as you can to absorb the blows as the economy contracts, which it must. Oil IS running out, and you just can't produce as much as we did without it.
Joined: Sep 25, 2005 Posts: 1952 Location: Waiuku, New Zealand
Posted: Thu Jul 17, 2008 2:50 am Post subject: Re: Powering Down to Core Consumption
kublikhan wrote:
But oil price hikes is how we will see the shortage manifest itself. Example:
Cost of Oil is .25 units of GDP
Scenario 1:
50 units of oil for 100 units of GDP
oil bill = 12.5 units of GDP(1/8 of the economy goes to paying for oil import bill)
Scenario 2:
100 units of oil for 400 units of GDP
oil bill = 25 units of GDP(1/16 of the economy goes to paying for oil import bill)
Oil Price now doubles:
Cost of oil is .5 units of GDP
Scenario 1:
50 units of oil for 100 units of GDP
oil bill = 25 units of GDP(1/4 of the economy goes towards paying oil import bill)
Scenario 2:
100 units of oil for 400 units of GDP
oil bill = 50 units of GDP(1/8 of economy goes towards paying for oil import bill)
But you were talking of energy declines. You're now assuming that even though oil declines, economies will still be able to consume all the oil they want to. This doesn't make sense. Maybe some economies will be able to outbid others, but that means oil will decline faster in those economies that lose out. So it is the consequences of the decline that is the more important factor, or at least as important a factor. If far more gets done, for each barrel, than a few decades ago, then the consequences of a decline will be more severe than a few decades ago.
As long as an economy can afford to outbid others, and get the oil it wants, then that economy shouldn't suffer from declines, only from the cost. But as soon as an economy can no longer get hold of the oil it needs, then that economy should decline much faster than oil declines, because of the low energy intensity.
Is there a fault with this, in terms of decline, not cost?
Joined: Sep 25, 2005 Posts: 1952 Location: Waiuku, New Zealand
Posted: Thu Jul 17, 2008 3:05 am Post subject: Re: Powering Down to Core Consumption
ReverseEngineer wrote:
This type of cyclical economics tends to indicate that the trip back down off Peak Oil will take somewhere near the 100 years it took to climb the curve to begin with. Gradually decreasing the standard of living until the oil is truly gone for good, but maybe that 100 years gives time to readjust in energy intensity and utilize the knowledge gained in the trip up the curve to make life slightly better than it was in say 1750, before Oil came to rule the world and the Industrial Economy took over?
The trouble is, 100 years ago, the population was about 1.5 billion. So don't think the downward slope will be anything like the upward slope, either in timing or effect. We will, no doubt apply every smart technology we can think of, to keep up the production rate and increase the ultimate decline rate. I don't know if the increasing proportion of smaller fields can be successfully developed and produced for 100 years. And people's expectations, in increasing numbers of countries, are much higher now.
I agree that there will be boom bust cycles, on the way down, but only because we're not taking heed of what is happening, always believing the economy will recover to its former glory. If we took heed of what was happening, we'd be planning for a very different economy and society. Way before 100 years, I think enough people will "get it" to potentially cause a social unrest problem, unless that awareness is channeled into the right actions.
Posted: Thu Jul 17, 2008 6:37 am Post subject: Re: Powering Down to Core Consumption
TonyPrep wrote:
As long as an economy can afford to outbid others, and get the oil it wants, then that economy shouldn't suffer from declines, only from the cost. But as soon as an economy can no longer get hold of the oil it needs, then that economy should decline much faster than oil declines, because of the low energy intensity.
Is there a fault with this, in terms of decline, not cost?
I think so. This is happening domestically right now. We import 2/3 our oil and the amount of money we're shipping out of the country to buy oil has just increased dramatically. This means less money available for other activity which will ultimately lead to a decline in GDP.
Unless of course we get smarter and figure out how to do more with less. This productivity is what drives a large chunk of our economy anyway and I have to believe people aren't suddenly going to go all stupid and forget how to do things better.
Posted: Thu Jul 17, 2008 8:18 am Post subject: Re: Powering Down to Core Consumption
TonyPrep wrote:
I disagree. If people can get it through their thick heads that, at some point in the future, economic growth will have to stop (and I don't think you disagree with that, though I could be wrong), and that it's impossible to figure out exactly when that will be, then that realisation might prompt some planning for, and even purposeful movement towards, that future. On the other hand, saying we can maintain growth for some limited time, again an unknown time, would probably lead most people to postpone any action or planning for sustainability, and thus act as though growth was possible for ever.
I think you're projecting a false premise, the belief that growth is possible forever, onto people. We have clear signals via the economic system that growth in a given arena isn't going to proceed as planned due to price decades before we actually see that decrease in growth. That being said, while it may be that there is some optimal level of resource use to maximize odds of our survivability, we can't expect everyone to behave in that way. Some will only want to live for the day, while others will spend their time planning for something at some point in the future, and everything in between. The great thing about our society is that for the most part it allows for everything in between. We can go blow all our money on vices, or use it to purchase the goods needed for us to live in the middle of nowhere, away from anyone, or at least other groups of people, until we die. Either or. In any event, not you, nor I, nor anyone knows exactly when we will be forced to curtail overall growth. It could be tomorrow it could a million years from now, depending on a lot of things, including the overall rate of growth, resource availability, and behavior of society at the time, among others... We do at least know that limits to growth in specific arenas, and looking at our civilization as a whole, the sum of those limits, when present as a limiting factor, will be incredibly obvious IMO. I don't see how it couldn't be.
TonyPrep wrote:
I would consider planning for zero growth to be a better course of action than continually postponing it just because it might not be a problem for a while. You, on the other hand, might argue for the latter.
No I wouldn't. I think planning for many contingencies, including zero growth, is prudent. In fact, I would go so far as to say that the amount of time spent planning should be proportional to the the likelihood of the change as well as the likelihood of our survival due to the change when accounting for our time spent planning. _________________
Posted: Thu Jul 17, 2008 8:40 am Post subject: Re: Powering Down to Core Consumption
TonyPrep wrote:
So what do you have to say about energy and GDp in the long term (let's say 50 years, rather than infinity). Do you think it likely that economic growth could be maintained for 50 years, with energy declining, or remaining flat, for those 50 years? I'm not talking about impossible, or about some measurement of probability, but likelihood.
I don't quite understand what you're saying. What's the difference between probability and likelihood? Are you asking for a qualitative assessment (eg it's very likely or barely likely that this or that will happen) or a quantitative assessment (eg there's a X percent chance of this happening and a "Y" percent chance of that happening)?
TonyPrep wrote:
I used 50 years because there is a good chance that my kids will be alive for that long and I want to know if they can assume that they can fulfil what has become a normal aspiration - to work hard and earn plenty of money to get their own houses, get their own cars, have regular vacations abroad, keep upgrading to the latest technological wizardy and eventually eye up a leisurely retirement, living on the proceeds of 40 years good income. If you think it's likely, I can pass that on to them, and they can carry on as normal.
Regardless of what will happen, I say prepare for the worst, hope for the best. Be it an asteroid impact, super volcano, the effects peak oil, or whatever catastrophe we have in mind. In these cases, a little bit of prep goes a long way. The more we prep, the more limited returns become, so building a survival bunker in Australia may not provide the best ROI. Otoh, there are some measures that are both advantageous in case of an emergency and sensible on a daily basis. For instance improving the efficiency so to speak, of a house will not only save money overall, but would also make it more livable in disaster where little to no energy commodities were available. Having a vehicle that is entirely mechanical (bicycle and/or old auto) would allow you to start it in the event of a significant EMP that would otherwise fry unshielded electronics. And the list goes on.... LMK if there's anything you're curious about. _________________
Joined: Oct 08, 2005 Posts: 45 Location: Minneapolis, MN
Posted: Thu Jul 17, 2008 11:04 am Post subject: Re: Powering Down to Core Consumption
MonteQuest wrote:
You know, I think it's time use the ignore feature. No one wants to post admid your crap.
Wow. I never thought I'd see someone exhaust your enormous amount of patience. I can't blame you, though. He's so full of crap he'd make an outhouse jealous.
You hear that, yesplease? You have done the seemingly impossible. (Don't bother answering, though -- I've got you on Ignore as well. )
Now, let's get this thread back on track. _________________ I tread lightly as I can on the Earth.
MonteQuest, "Same thing."
yesplease, "What's the same thing?"
MonteQuest, "You and a troll."
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