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A Forecast Of Our Energy Future; Why Common Solutions Don't Work

Tyler Durden's picture


Submitted by Gail Tverberg via Our Finite World blog,

In order to understand what solutions to our energy predicament will or won’t work, it is necessary to understand the true nature of our energy predicament. Most solutions fail because analysts assume that the nature of our energy problem is quite different from what it really is. Analysts assume that our problem is a slowly developing long-term problem, when in fact, it is a problem that is at our door step right now.

The point that most analysts miss is that our energy problem behaves very much like a near-term financial problem. We will discuss why this happens. This near-term financial problem is bound to work itself out in a way that leads to huge job losses and governmental changes in the near term. Our mitigation strategies need to be considered in this context. Strategies aimed simply at relieving energy shortages with high priced fuels and high-tech equipment are bound to be short lived solutions, if they are solutions at all.


1. Our number one energy problem is a rapidly rising need for investment capital, just to maintain a fixed level of resource extraction. This investment capital is physical “stuff” like oil, coal, and metals.

We pulled out the “easy to extract” oil, gas, and coal first. As we move on to the difficult to extract resources, we find that the need for investment capital escalates rapidly. According to Mark Lewis writing in the Financial Times, “upstream capital expenditures” for oil and gas amounted to  nearly $700 billion in 2012, compared to $350 billion in 2005, both in 2012 dollars. This corresponds to an inflation-adjusted annual increase of 10% per year for the seven year period.

Figure 1. The way would expect the cost of the extraction of energy supplies to rise, as finite supplies deplete.

Figure 1. The way would expect the cost of the extraction of energy supplies to rise, as finite supplies deplete.

In theory, we would expect extraction costs to rise as we approach limits of the amount to be extracted. In fact, the steep rise in oil prices in recent years is of the type we would expect, if this is happening. We were able to get around the problem in the 1970s, by adding more oil extraction, substituting other energy products for oil, and increasing efficiency. This time, our options for fixing the situation are much fewer, since the low hanging fruit have already been picked, and we are reaching financial limits now.

Figure 2. Historical oil prices in 2012 dollars, based on BP Statistical Review of World Energy 2013 data. (2013 included as well, from EIA data.)

Figure 2. Historical oil prices in 2012 dollars, based on BP Statistical Review of World Energy 2013 data. (2013 included as well, from EIA data.)

To make matters worse, the rapidly rising need for investment capital arises is other industries as well as fossil fuels. Metals extraction follows somewhat the same pattern. We extracted the highest grade ores, in the most accessible locations first. We can still extract more metals, but we need to move to lower grade ores. This means we need to remove more of the unwanted waste products, using more resources, including energy resources.

Figure 3. Waste product to produce 100 units of metal

Figure 3. Waste product to produce 100 units of metal

There is a huge increase in the amount of waste products that must be extracted and disposed of, as we move to lower grade ores (Figure 3). The increase in waste products is only 3% when we move from ore with a concentration of .200, to ore with a concentration .195. When we move from a concentration of .010 to a concentration of .005, the amount of waste product more than doubles.

When we look at the inflation adjusted cost of base metals (Figure 4 below), we see that the index was generally falling for a long period between the 1960s and the 1990s, as productivity improvements were greater than falling ore quality.

Figure 4. World Bank inflation adjusted base metal index (excluding iron).

Figure 4. World Bank inflation adjusted base metal index (excluding iron).

Since 2002, the index is higher, as we might expect if we are starting to reach limits with respect to some of the metals in the index.

There are many other situations where we are fighting a losing battle with nature, and as a result need to make larger resource investments. We have badly over-fished the ocean, so  fishermen now need to use more resources too catch the remaining much smaller fish.  Pollution (including CO2 pollution) is becoming more of a problem, so we invest resources in  devices to capture mercury emissions and in wind turbines in the hope they will help our pollution problems. We also need to invest increasing amounts in roads,  bridges, electricity transmission lines, and pipelines, to compensate for deferred maintenance and aging infrastructure.

Some people say that the issue is one of falling Energy Return on Energy Invested (EROI), and indeed, falling EROI is part of the problem. The steepness of the curve comes from the rapid increase in energy products used for extraction and many other purposes, as we approach limits.  The investment capital limit was discovered by the original modelers of Limits to Growth in 1972. I discuss this in my post Why EIA, IEA, and Randers’ 2052 Energy Forecasts are Wrong.

2. When the amount of oil extracted each year flattens out (as it has since 2004), a conflict arises: How can there be enough oil both (a) for the growing investment needed to maintain the status quo, plus (b) for new investment to promote growth?

In the previous section, we talked about the rising need for investment capital, just to maintain the status quo. At least some of this investment capital needs to be in the form of oil.  Another use for oil would be to grow the economy–adding new factories, or planting more crops, or transporting more goods. While in theory there is a possibility of substituting away from oil, at any given point in time, the ability to substitute away is quite limited. Most transport options require oil, and most farming requires oil. Construction and road equipment require oil, as do diesel powered irrigation pumps.

Because of the lack of short term substitutability, the need for oil for reinvestment tends to crowd out the possibility of growth. This is at least part of the reason for slower world-wide economic growth in recent years.

3. In the crowding out of growth, the countries that are most handicapped are the ones with the highest average cost of their energy supplies.

For oil importers, oil is a very high cost product, raising the average cost of energy products. This average cost of energy is highest in countries that use the highest percentage of oil in their energy mix.

If we look at a number of oil importing countries, we see that economic growth tends to be much slower in countries that use very much oil in their energy mix. This tends to happen  because high energy costs make products less affordable. For example, high oil costs make vacations to Greece unaffordable, and thus lead to cut backs in their tourist industry.

It is striking when looking at countries arrayed by the proportion of oil in their energy mix, the extent to which high oil use, and thus high cost energy use, is associated with slow economic growth (Figure 5, 6, and 7). There seems to almost be a dose response–the more oil use, the lower the economic growth. While the PIIGS (Portugal, Italy, Ireland, Greece, and Spain) are shown as a group, each of the countries in the group shows the same pattern on high oil consumption as a percentage of its total energy production in 2004.

Globalization no doubt acted to accelerate this shift toward countries that used little oil. These countries tended to use much more coal in their energy mix–a much cheaper fuel.

Figure 5. Percent energy consumption from oil in 2004, for selected countries and country groups, based on BP 2013 Statistical Review of World Energy. (EU - PIIGS means "EU-27 minus PIIGS')

Figure 5. Percent energy consumption from oil in 2004, for selected countries and country groups, based on BP 2013 Statistical Review of World Energy. (EU – PIIGS means “EU-27 minus PIIGS’)

Figure 6. Average percent growth in real GDP between 2005 and 2011, based on USDA GDP data in 2005 US$.

Figure 6. Average percent growth in real GDP between 2005 and 2011, based on USDA GDP data in 2005 US$.

Figure 7. Average percentage consumption growth between 2004 and 2011, based on BP's 2013 Statistical Review of World Energy.

Figure 7. Average percentage consumption growth between 2004 and 2011, based on BP’s 2013 Statistical Review of World Energy.

4. The financial systems of countries with slowing growth are especially affected, as are the governments. Debt becomes harder to repay with interest, as economic growth slows.

With slow growth, debt becomes harder to repay with interest. Governments are tempted to add programs to aid their citizens, because employment tends to be low. Governments find that tax revenue lags because of the lagging wages of most citizens, leading to government deficits. (This is precisely the problem that Turchin and Nefedov noted, prior to collapse, when they analyzed eight historical collapses in their book Secular Cycles.)

Governments have recently attempt to fix both their own financial problems and the problems of their citizens by lowering interest rates to very low levels and by using Quantitative Easing. The latter allows governments to keep even long term interest rates low.  With Quantitative Easing, governments are able to keep borrowing without having a market of ready buyers. Use of Quantitative Easing also tends to blow bubbles in prices of stocks and real estate, helping citizens to feel richer.

5. Wages of citizens of  countries oil importing countries tend to remain flat, as oil prices remain high.

At least part of the wage problem relates to the slow economic growth noted above. Furthermore, citizens of the country will cut back on discretionary goods, as the price of oil rises, because their cost of commuting and of food rises (because oil is used in growing food). The cutback in discretionary spending leads to layoffs in discretionary sectors. If exported goods are high priced as well, buyers from other countries will tend to cut back as well, further leading to layoffs and low wage growth.

6. Oil producers find that oil prices don’t rise high enough, cutting back on their funds for reinvestment. 

As oil extraction costs increase, it becomes difficult for the demand for oil to remain high, because wages are not increasing. This is the issue I describe in my post What’s Ahead? Lower Oil Prices, Despite Higher Extraction Costs.

We are seeing this issue today. Bloomberg reports, Oil Profits Slump as Higher Spending Fails to Raise Output. Business Week reports Shell Surprise Shows Profit Squeeze Even at $100 Oil. Statoil, the Norwegian company, is considering walking away from Greenland, to try to keep a lid on production costs.

7. We find ourselves with a long-term growth imperative relating to fossil fuel use, arising from the effects of globalization and from growing world population.

Globalization added approximately 4 billion consumers to the world market place in the 1997 to 2001 time period. These people previously had lived traditional life styles. Once they became aware of all of the goods that people in the rich countries have, they wanted to join in, buying motor bikes, cars, televisions, phones, and other goods. They would also like to eat meat more often. Population in these countries continues to grow adding to demand for goods of all kinds. These goods can only be made using fossil fuels, or by technologies that are enabled by fossil fuels (such as today’s hydroelectric, nuclear, wind, and solar PV).

8. The combination of these forces leads to a situation in which economies, one by one, will turn downward in the very near future–in a few months to a year or two. Some are already on this path (Egypt, Syria, Greece, etc.)

We have two problems that tend to converge: financial problems that countries are now hiding, and ever rising need for resources in a wide range of areas that are reaching limits (oil, metals, over-fishing, deferred maintenance on pipelines).

On the financial side, we have countries trying to hang together despite a serious mismatch between revenue and expenses, using Quantitative Easing and ultra-low interest rates. If countries unwind the Quantitative Easing, interest rates are likely to rise. Because debt is widely used, the cost of everything from oil extraction to buying a new home to buying a new car is likely to rise. The cost of repaying the government’s own debt will rise as well, putting governments in worse financial condition than they are today.

A big concern is that these problems will carry over into debt markets. Rising interest rates will lead to widespread defaults. The availability of debt, including for oil drilling, will dry up.

Even if debt does not dry up, oil companies are already being squeezed for investment funds, and are considering cutting back on drilling. A freeze on credit would make certain this happens.

Meanwhile, we know that investment costs keep rising, in many different industries simultaneously, because we are reaching the limits of a finite world. There are more resources available; they are just more expensive. A mismatch occurs, because our wages aren’t going up.

The physical amount of oil needed for all of this investment keeps rising, but oil production continues on its relatively flat plateau, or may even begins to drop. This leads to less oil available to invest in the rest of the economy. Given the squeeze, even more countries are likely to encounter slowing growth or contraction.

9. My expectation is that the situation will end with a fairly rapid drop in the production of all kinds of energy products and the governments of quite a few countries failing. The governments that remain will dramatically cut services.

With falling oil production, promised government programs will be far in excess of what governments can afford, because governments are basically funded out of the surpluses of a fossil fuel economy–the difference between the cost of extraction and the value of these fossil fuels to society. As the cost of extraction rises, the surpluses tend to dry up.

Figure 8. Cost of extraction of barrel oil, compared to value to society. Economic growth is enabled by the difference.

Figure 8. Cost of extraction of barrel oil, compared to value to society. Economic growth is enabled by the difference.

As these surpluses shrink, governments will need to shrink back dramatically. Government failure will be easier than contracting back to a much smaller size.

International finance and trade will be particularly challenging in this context. Trying to start over will be difficult, because many of the new countries will be much smaller than their predecessors, and will have no “track record.” Those that do have track records will have track records of debt defaults and failed promises, things that will not give lenders confidence in their ability to repay new loans.

While it is clear that oil production will drop, with all of the disruption and a lack of operating financial markets, I expect natural gas and coal production will drop as well. Spare parts for almost anything will be difficult to get, because of the need for the system of international trade to support making these parts. High tech goods such as computers and phones will be especially difficult to purchase. All of these changes will result in a loss of most of the fossil fuel economy and the high tech renewables that these fossil fuels support.

A Forecast of Future Energy Supplies and their Impact

A rough estimate of the amounts by which energy supply will drop is given in Figure 9, below.

Figure 9. Estimate of future energy production by author. Historical data based on BP adjusted to IEA groupings.

Figure 9. Estimate of future energy production by author. Historical data based on BP adjusted to IEA groupings.

The issue we will be encountering could be much better described as “Limits to Growth” than “Peak Oil.” Massive job layoffs will occur, as fuel use declines. Governments will find that their finances are even more pressured than today, with calls for new programs at the time revenue is dropping dramatically. Debt defaults will be a huge problem. International trade will drop, especially to countries with the worst financial problems.

One big issue will be the need to reorganize governments in a new, much less expensive  way. In some cases, countries will break up into smaller units, as the Former Soviet Union did in 1991. In some cases, the situation will go back to local tribes with tribal leaders. The next challenge will be to try to get the governments to act in a somewhat co-ordinated way.  There may need to be more than one set of governmental changes, as the global energy supplies decline.

We will also need to begin manufacturing goods locally, at a time when debt financing no longer works very well, and governments are no longer maintaining roads. We will have to figure out new approaches, without the benefit of high tech goods like computers. With all of the disruption, the electric grid will not last very long either. The question will become: what can we do with local materials, to get some sort of economy going again?


There are a lot of proposed solutions to our problem. Most will not work well because the nature of the problem is different from what most people have expected.

1. Substitution. We don’t have time. Furthermore, whatever substitutions we make need to be with cheap local materials, if we expect them to be long-lasting. They also must not over-use resources such as wood, which is in limited supply.

Electricity is likely to decline in availability almost as quickly as oil because of inability to keep up the electrical grid and other disruptions (such as failing governments, lack of oil to lubricate machinery, lack of replacement parts, bankruptcy of companies involved with the production of electricity) so is not really a long-term solution to oil limits.

2. Efficiency. Again, we don’t have time to do much. Higher mileage cars tend to be more expensive, replacing one problem with another. A big problem in the future will be lack of road maintenance. Theoretical gains in efficiency may not hold in the real world. Also, as governments reduce services and often fail, lenders will be unwilling to lend funds for new projects which would in theory improve efficiency.

In some cases, simple devices may provide efficiency. For example, solar thermal can often be a good choice for heating hot water. These devices should be long-lasting.

3. Wind turbines. Current industrial type wind turbines will be hard to maintain, so are  unlikely to be long-lasting. The need for investment capital for wind turbines will compete with other needs for investment capital. CO2 emissions from fossil fuels will drop dramatically, with or without wind turbines.

On the other hand, simple wind mills made with local materials may work for the long term. They are likely to be most useful for mechanical energy, such as pumping water or powering looms for cloth.

4. Solar Panels. Promised incentive plans to help homeowners pay for solar panels can be expected to mostly fall through. Inverters and batteries will need replacement, but probably will not be available. Handy homeowners who can rewire the solar panels for use apart from the grid may find them useful for devices that can run on direct current. As part of the electric grid, solar panels will not add to its lifetime. It probably will not be possible to make solar panels for very many years, as the fossil fuel economy reaches limits.

5. Shale Oil. Shale oil is an example of a product with very high investment costs, and returns which are doubtful at best. Big companies who have tried to extract shale oil have decided the rewards really aren’t there. Smaller companies have somehow been able to put together financial statements claiming profits, based on hoped for future production and very low interest rates.

Costs for extracting shale oil outside the US for shale oil are likely to be even higher than in the US. This happens because the US has laws that enable production (landowner gets a share of profits) and other beneficial situations such as pipelines in place, plentiful water supplies, and low population in areas where fracking is done. If countries decide to ramp up shale oil production, they are likely to run into similarly hugely negative cash flow situations. It is hard to see that these operations will save the world from its financial (and energy) problems.

6. Taxes. Taxes need to be very carefully structured, to have any carbon deterrent benefit. If part of taxes consumers would normally pay to the government are levied on fuel for vehicles, the practice can encourage more the use of more efficient vehicles.

On the other hand, if carbon taxes are levied on businesses, the taxes tend to encourage businesses to move their production to other, lower-cost countries. The shift in production leads to the use of more coal for electricity, rather than less. In theory, carbon taxes could be paired with a very high tax on imported goods made with coal, but this has not been done. Without such a pairing, carbon taxes seem likely to raise world CO2 emissions.

7.  Steady State Economy. Herman Daly was the editor of a book in 1973 called Toward a Steady State Economy, proposing that the world work toward a Steady State economy, instead of growth. Back in 1973, when resources were still fairly plentiful, such an approach would have acted to hold off  Limits to Growth for quite a few years, especially if zero population growth were included in the approach.  

Today, it is far too late for such an approach to work. We are already in a situation with very depleted resources. We can’t keep up current production levels if we want to–to do so would require greatly ramping up energy production because of the rising need for energy investment to maintain current production, discussed in Item (1) of Our Energy Predicament. Collapse will probably be impossible to avoid. We can’t even hope for an outcome as good as a Steady State Economy.

7. Basing Choice of Additional Energy Generation on EROI Calculations. In my view, basing new energy investment on EROI calculations is an iffy prospect at best. EROI calculations measure a theoretical piece of the whole system–”energy at the well-head.” Thus, they miss important parts of the system, which affect both EROI and cost. They also overlook timing, so can indicate that an investment is good, even if it digs a huge financial hole for organizations making the investment. EROI calculations also don’t consider repairability issues which may shorten real-world lifetimes.

Regardless of EROI indications, it is important to consider the likely financial outcome as well. If products are to be competitive in the world marketplace, electricity needs to be inexpensive, regardless of what the EROI calculations seem to say. Our real problem is lack of investment capital–something that is gobbled up at prodigious rates by energy generation devices whose costs occur primarily at the beginning of their lives. We need to be careful to use our investment capital wisely, not for fads that are expensive and won’t hold up for the long run.

8. Demand Reduction. This really needs to be the major way we move away from fossil fuels. Even if we don’t have other options, fossil fuels will move away from us. Encouraging couples to have smaller families would seem to be a good choice.


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Sat, 02/01/2014 - 17:20 | 4391810 666
666's picture

Tap into the fart zone atmospheric layer above the earth and you'll have unlimited energy. Alternatively, connect pipes from all the politician's mouths and asses and burn, baby, burn!

Sat, 02/01/2014 - 17:27 | 4391826 Flakmeister
Flakmeister's picture

Sorry, but this thread will be PG-13, clearly above your level....

Sat, 02/01/2014 - 18:01 | 4391905 max2205
max2205's picture

In our next lesson we won't cover energy taxation'll never be cheap

Sat, 02/01/2014 - 18:07 | 4391917 James_Cole
James_Cole's picture

With falling oil production, promised government programs will be far in excess of what governments can afford, because governments are basically funded out of the surpluses of a fossil fuel economy–the difference between the cost of extraction and the value of these fossil fuels to society. As the cost of extraction rises, the surpluses tend to dry up.

Whoa whoa wait a sec, are you saying it's not the uber rich 'job creators' who are the engine of the economy??

And to think, all this time I'd thought it was all them saudi entrepreneurs that made Dubai happen!

Sat, 02/01/2014 - 18:32 | 4391986 Induced Coma
Induced Coma's picture

Exponential growth, it's what's for dinner.





Sat, 02/01/2014 - 20:14 | 4392242 boogerbently
boogerbently's picture

I'm assuming that parabolic to vertical rise in "cost of production" includes all Green Energy R&D costs which allow for their ZERO % tax payments.

Sun, 02/02/2014 - 02:45 | 4393020 Flakmeister
Flakmeister's picture

You clearly don't have a clue what the article is about, do you?

Sun, 02/02/2014 - 03:30 | 4393060 Oh regional Indian
Oh regional Indian's picture

Flak, your excitement is palpable, even this far time and geography shifted ;-)


Sun, 02/02/2014 - 11:27 | 4393347 Flakmeister
Flakmeister's picture

More like annoyance...

Sat, 02/01/2014 - 18:08 | 4391923 HelluvaEngineer
HelluvaEngineer's picture

No worries.  Once Ted Turner kills off 95% of us, all of these problems go away.

Sat, 02/01/2014 - 17:25 | 4391819 Yen Cross
Yen Cross's picture

  That Piigs "oil consumption" chart is priceless.  The 3rd world/ emerging economies are much more detrimental on{existing} fuel stocks then "Western Economies."

Sat, 02/01/2014 - 17:55 | 4391895 Doña K
Doña K's picture

It will be a new world indeed, unless..... 

Sat, 02/01/2014 - 18:02 | 4391911 Yen Cross
Yen Cross's picture

 That it will Doña K.  ;)

Sat, 02/01/2014 - 18:05 | 4391919 Sudden Debt
Sudden Debt's picture

to speed up a depopulation event you increase access to the resources for all so it depletes 10 times faster.

Sat, 02/01/2014 - 19:26 | 4392129 Yen Cross
Yen Cross's picture

   Holy Cow.  You're putting the cart in front of the horse<

Sat, 02/01/2014 - 19:59 | 4392206 CrashisOptimistic
CrashisOptimistic's picture

That is the CiO methodology of future war.

You do not bomb the populace.  You bomb the tankers.  You want the people alive to consume their storage faster.  Cut off the influx and keep the population alive and the oil is soon gone, and then the food from the shelves. 

They surrender in a matter of weeks.

Sat, 02/01/2014 - 19:54 | 4392191 Acet
Acet's picture

That chart is bullshit.

In Portugal, for example, more than 30% of energy production is renewables, mostly because historically the country built a lot of hydroelectrical power.


Beyond that, remember that if there is a resource the PIIGS (except Ireland) have a lot is sun, making it a pretty natural source of replacement energy (think concentrated solar power plants rather than solar panels).

Sat, 02/01/2014 - 22:55 | 4392649 Ignorance is bliss
Ignorance is bliss's picture

You need silver for solar panels in plants or homes. You need fossil fuels to dig out silver. Back to the author's point. Long term solar power is not an option.

Sat, 02/01/2014 - 23:29 | 4392741 Matt
Matt's picture

Did you know there are other ways, some actually more efficient, than semiconductor panels, to harvest solar energy? For example, stirling engines.

Sun, 02/02/2014 - 01:05 | 4392918 Flakmeister
Flakmeister's picture

Thermodynamically yes, but far more expensive to realize...

Sun, 02/02/2014 - 13:22 | 4393563 Kirk2NCC1701
Kirk2NCC1701's picture

Time to stock up on Ag is now, especially at its current prices ($20/oz).

Does the author (or people here) actually 'know' how much Ag is needed per panel?

Hint: countries like Switzerland have already made visionary and strategic decisions to be energy neutral (efficient creation and usage, local & regional solutions to working, living, rail, solar, hydro, multi-generational houses...).

IOW, while these things are indeed possible, living a satisfying and meaningful live in this paradigm requires a massive shift for hi-consumption, hi-waste lifestyle of Americans.

The biggest challenges are not technical or even financial, but social and cultural. The real tell will be if and how social and cultural changes will adapt, and at what pace.

In the meantime -- what all ZHers know: Thou shall be more "resilient". Diversify and allocate shrewdly.

Sun, 02/02/2014 - 14:01 | 4393642 Flakmeister
Flakmeister's picture

Really? What fraction of fossil fuel usage is related to mining those minerals critical to solar panel production?

You clearly don't think about stuff through to it's logical conclusion....

Tue, 02/04/2014 - 12:35 | 4400381 Acet
Acet's picture

Which part of "think concentrated solar power plants rather than solar panels" was not clear?

There are very efficient ways of collecting solar power without solar panels, for example by using mirrors to focus solar light into a central pilar, thus melting salt which is then used to produce vapour and drive a turbine.



Tue, 02/04/2014 - 13:50 | 4400658 Flakmeister
Flakmeister's picture

They are not cost effective however compared to panels...

Sat, 02/01/2014 - 17:25 | 4391820 Flakmeister
Flakmeister's picture

"Drill Baby Drill" did not quite work as advertised....

Sat, 02/01/2014 - 17:29 | 4391828 Yen Cross
Yen Cross's picture

  What part of capacity utilization did you miss?

Sat, 02/01/2014 - 18:09 | 4391925 FeralSerf
FeralSerf's picture

I didn't have any difficulty finding a place to fill up last time.  No lines either!  And have you noticed what's happened to natural gas prices for the last 10 years?

Why do you continue with this BS about energy shortages?  Energy is everywhere.  It's just up to homo s. to figure out how to tame and use it.   If the way that's worked isn't working anymore, then he needs to find one that does.  Or die.  Just like he did when he was running out of whale oil.

Sat, 02/01/2014 - 18:47 | 4392029 mumbo_jumbo
mumbo_jumbo's picture

there's money to be made convincing the sheople otherwise......AND lots of it.

Sat, 02/01/2014 - 19:02 | 4392073 elegance
elegance's picture

"Energy is everywhere". It is indeed. E=mc2 as everyone with more than 2 brain cells knows. Finding source of energy as cheap as oil was for last 150 years is a different matter though.

Sat, 02/01/2014 - 19:55 | 4392193 zanez
zanez's picture

Henry Hub natgas spot price Dec 4, 1998:  $1.05

Henry Hub natgqas sopt price Jan. 27, 2014:  $5.66

^^ This is what's happened to natgas prices in the past 15 years.


Sat, 02/01/2014 - 18:43 | 4392020 Spastica Rex
Spastica Rex's picture

I'm always late for the fun discussions.

Sat, 02/01/2014 - 17:28 | 4391825 jmeyer
jmeyer's picture

There are real alternatives to fossil fuels. In this country, Blacklight Power, a NJ company has a truly revolutionary paradigm changing

and well developed technology nearing commercial placement. An Italian company headed by Andrea Rossi has found large financial backing

for its COLD FUSION process. Our own US Federal Government has made funding available for LENR ( low energy nuclear reactions ) . Scientists in and out of the mainstream

have done pioneering research in new energy methods that will soon replace fossil fuels.

Sat, 02/01/2014 - 17:32 | 4391835 Pheonyte
Pheonyte's picture

You could give MDB a run for his money with BS like that.

Sat, 02/01/2014 - 18:57 | 4392060 HulkHogan
HulkHogan's picture

He obviously has never heard of the laws of thermodynamics.

Sat, 02/01/2014 - 17:35 | 4391842 Flakmeister
Flakmeister's picture

Oh my, a scientifically illiterate yokel...

Rossi is a scam, tii bad you don't have the ability to see through it...

See for example:

Siegal rips the E-Cat a new one... That is what real skeptics can do to con artists and psuedo-scientists...

Sat, 02/01/2014 - 17:44 | 4391862 El Vaquero
El Vaquero's picture

Funny how all of those new energy sources and free energy schemes wind up being duds. 

Sat, 02/01/2014 - 17:59 | 4391906 James_Cole
James_Cole's picture

Commercial nuclear fusion will happen at some point, there's just not enough incentive ($$) at the moment. 

Sat, 02/01/2014 - 18:17 | 4391946 Bunga Bunga
Bunga Bunga's picture

Yeah, people will find incentives to blow up the planet /sarc off. Even if fusion gets clean and safe, we will be all toast in 200 years even at a modest growth rate of 4%. Unfortunately man is unable to break natural law aka the entropy on our planet.

Sat, 02/01/2014 - 20:33 | 4392195 DFCtomm
DFCtomm's picture

You realize that they are just beginning to find earth like planets that are close enough to travel to at sub light speeds. It is a finite world but worlds are infinite.

Sat, 02/01/2014 - 22:41 | 4392609 Flakmeister
Flakmeister's picture

You are a shining example of how a little knowledge can be a dangerous thing...

Sat, 02/01/2014 - 23:33 | 4392748 Matt
Matt's picture

Well, lets see. At 1 percent of the speed of light average speed, it would take 1200 years to travel 12 light years. If you think Walt Disney is coming out of the freezer soon, you should definitely sign up for intersteller colonization. 

Sat, 02/01/2014 - 23:38 | 4392758 akak
akak's picture

Oh fuck, a literal "Disney World"?!

I'm NEVER going on vacation there!

Sun, 02/02/2014 - 01:28 | 4392953 El Vaquero
El Vaquero's picture

It's a small world afterall.

Mon, 02/03/2014 - 00:38 | 4394921 Mike in GA
Mike in GA's picture

To infinity...and beyond!

Sat, 02/01/2014 - 18:21 | 4391953 Yen Cross
Yen Cross's picture

 The materials and technology for " Nuclear Fusion" exist and work.

  Containment of particulates was the largest hurdle.

Sat, 02/01/2014 - 18:28 | 4391974 James_Cole
James_Cole's picture

Of course it works, but is not financially feasible. 

Sat, 02/01/2014 - 18:32 | 4391984 Bunga Bunga
Bunga Bunga's picture

It will never be financially feasible long term, physics prevents it.

Sat, 02/01/2014 - 18:44 | 4392026 Yen Cross
Yen Cross's picture

  That comment is inacurate. The KWJ involved in sustaining the "fusion reaction" are lower then the suns hypothetical output.

  It's an question of mass to produce energy.

Sat, 02/01/2014 - 19:01 | 4392067 Bunga Bunga
Bunga Bunga's picture

Such economic calculations are valid in a lab only, but not when you take the environment into account long term. In such calculations one generation takes credit from mother nature,  and future generations have to pay that debt back to mother nature until they can't because this insanity blew up the planet.

Sat, 02/01/2014 - 19:21 | 4392122 James_Cole
James_Cole's picture

Not at all, nuclear fusion works perfeclty well in nature. Planet Earth is powered by nuclear fusion, we just don't know how to recreate it effectively.

Sat, 02/01/2014 - 22:16 | 4392522 Bunga Bunga
Bunga Bunga's picture

I am not arguing that nuclear fusion works physically, but you can't ignore the second law of thermodynamics. In the end the environmental damage will cost much more than it gains in the beginning. The term "clean energy" is an oxymoron in the context of economic growth.

Sat, 02/01/2014 - 22:36 | 4392587 James_Cole
James_Cole's picture

you can't ignore the second law of thermodynamics. 

Don't know what you're getting at here. 

In the end the environmental damage will cost much more than it gains in the beginning.

All indications suggest the environmental impact will be low, certainly much lower than many fuel sources. 

Sat, 02/01/2014 - 22:54 | 4392646 Bunga Bunga
Bunga Bunga's picture

If you don't know the link between energy usage and heat get some basic physics book.

If impact will be catastrophic or not, always depends on physical quantity. But we are getting there very quickly to be catastrophic because of exponential growth.  


Sat, 02/01/2014 - 23:10 | 4392693 James_Cole
James_Cole's picture

So I cheated and went to wiki instead, but could you explain how you're referencing this to nuclear fusion?

2nd law:

It is an expression of the fact that over time, differences in temperature, pressure, and chemical potential decrease in an isolated non-gravitational physical system, leading eventually to a state of thermodynamic equilibrium.

Sat, 02/01/2014 - 23:24 | 4392725 Bunga Bunga
Bunga Bunga's picture

Great, now you can explain yourself how most of the energy produced by a power plant ends and why you can't reverse the process without additional energy.  

Sat, 02/01/2014 - 21:16 | 4392370 joego1
joego1's picture

There are solutions that work for individuals the problem is that it empowers individuals and not corporations so as far as the status quo goes they are considered non solutions.

Sat, 02/01/2014 - 17:46 | 4391868 Yen Cross
Yen Cross's picture

    I wouldn't waste my time "junking" you.   Your proverbs/ articles just solidify the niavaty in your comments.

Sat, 02/01/2014 - 18:19 | 4391951 FeralSerf
FeralSerf's picture

Credible laboratories around the world have done LENR experiments where lots of excess energy is produced and observed along with other byproducts that shouldn't exist according to existing theory.  LENR exists!  Why?  I don't know.  Man didn't know why burning whale oil produced light and heat in 1820 either.   Someone WILL know though, even though Big Oil and their partners in crime won't be pleased.  It will be the end of their VERY profitable 150 year monopoly.

Rossi may be a scam.  He may even be part of (like you) a Big Oil game to discredit the LENR experimentation. I don't know.  But the phenomona EXISTS.   That has been PROVEN beyond any doubt.  And it has the potential of being a trillion $$$ game changer!

Sat, 02/01/2014 - 17:47 | 4391867 rtalcott
rtalcott's picture

Yeah...a new state below the ground state previously known...

BlackLight Power, Inc. (BLP) of Cranbury, New Jersey is a company founded by Randell L. Mills, who claims to have discovered a new energy source. The purported energy source is based on Mills' assertion that the electron in a hydrogen atom can drop below the lowest energy state known as the ground state. Mills calls the theoretical hydrogen atoms that are in an energy state below ground level, "hydrinos".[1] Mills self-published a closely related book, The Grand Unified Theory of Classical Physics.[4]

The proposed theory is inconsistent with quantum mechanics and critics have ruled it out on those grounds, with some labelling it "fraud", "extremely unlikely", lacking corroborating scientific evidence, and a relic of cold fusion. In 2009 IEEE Spectrum magazine characterized it as a "loser" technology because "Most experts don't believe such lower states exist, and they say the experiments don’t present convincing evidence".[5] BlackLight has announced several times that it was about to deliver commercial products based on Mill's theories, and it has failed to deliver every time.[5]

Sat, 02/01/2014 - 18:06 | 4391920 SweetDoug
SweetDoug's picture




Well, better check here. Something's going on with this company.



Sat, 02/01/2014 - 18:14 | 4391938 rtalcott
rtalcott's picture

bs...ain't no new ground state found...

Sat, 02/01/2014 - 18:26 | 4391964 James_Cole
James_Cole's picture

It's almost certainly bullshit... the man is a fraud and no one thus far has been able to reproduce his results (including, it should be noted, him).

^ That's interesting, but hardly proof of anything at this point. 

Sat, 02/01/2014 - 18:33 | 4391991 rtalcott
rtalcott's picture

and here is another revolutionary new energy source...


There are quite a few of them out there

Sat, 02/01/2014 - 20:02 | 4392213 zanez
zanez's picture

A rotary magnetic electrical generator is "new technology" ? Maybe in 1850.

Sun, 02/02/2014 - 10:37 | 4393236 rtalcott
rtalcott's picture

next time I'll be more explicit about the sarcasm....although the web site is a hoot....another perpetual motion machine.

Sat, 02/01/2014 - 22:36 | 4392584 Matt
Matt's picture

I may be launching an unregulated, unaccountable crowdfunding effort to make Zero Point Energy available, will post more details soon if we greenlight the project. 

Looking for enthusiastic supporters to donate money, with rewards in a wide range of tiers, so I'm sure there will be something you'll like. Stay Tuned!

Sat, 02/01/2014 - 21:08 | 4392357 andrewp111
andrewp111's picture

The only possible "lower energy state" is something called a strange dibaryon, and nuclear physicists have been searching for such things for decades. Turns out nature is not so friendly. If strange dibaryons (or their heavier cogeners) exist at all, they seem to be a higher energy state that will quickly decay, not a lower one.

Sat, 02/01/2014 - 22:49 | 4392621 Flakmeister
Flakmeister's picture

There is no lower energy state in the context of what Mr. Hydrino is alledging...

In the quantum world ground states are very quickly reached...

Sat, 02/01/2014 - 19:49 | 4392177 James_Cole
James_Cole's picture

Nothing can replace wood burning for energy, NOTHING!

Sat, 02/01/2014 - 20:02 | 4392211 CrashisOptimistic
CrashisOptimistic's picture

Wood burning didn't have to move food for 7 billion people.

Sat, 02/01/2014 - 20:50 | 4392257 El Vaquero
El Vaquero's picture

That's the one thing that a lot of people ignore.  That liquid fuel is mighty convienient.  I can fill up a vehicle in 5 minutes.  I can add another couple of minutes to that by filling up spare gas cans.  I don't need expensive batteries or expensive fuel tanks that can hold 3k-5k PSI to only have an 80 mile driving limit.  Oil provides a very mobile energy source, and it is that mobility that is important.


Now, wood burning can power a steam engine to move a steam tractor.  But there is nothing like a tractor trailer rig to put that food right in that grocery store that is the endpoint for most people getting their food. 

Sat, 02/01/2014 - 22:52 | 4392639 CrashisOptimistic
CrashisOptimistic's picture

Subtle addition.

Only when diesel locomotives arrived did refrigeration during transport also arrive.  A cattle car was filled with live cattle and shipped to the city, because the meat would spoil enroute otherwise.  Problem with that was all the mass of a steer that is inedible was also transported.

You can't refrigerate PLUS move with anything but the good stuff.

Sun, 02/02/2014 - 00:41 | 4392884 El Vaquero
El Vaquero's picture

No argument there, but I will add that, should we be able bounce back and build a rail system that run off of wood (or whatever source of fuel) fired steam engines, we will be able to include a secondary steam turbine for power generation that runs off of the same fuel.  Probably even the same boiler.  And one thing that we have is the knoweldge to do is make vastly improved steam engines.  The question is, once SHTF, will we still have enough energy left to get it done, and if we do, will we be smart enough to not completely deplete whatever resources we're using for fuel in our greed?

Sun, 02/02/2014 - 16:23 | 4393966 Nehweh Gahnin
Nehweh Gahnin's picture

Ya ever look at a satellite photo of Haiti?  All this BS talk of using wood as a fuel ...

A commenter above pointed out that wood was never used to move food for 7 billion people.  Exactly right, and it never will.  When the oil becomes too expensive to justify its extraction for all but high-value special applications, all of our forests disappear.  Rapidly.  And so do we.

Sun, 02/02/2014 - 09:21 | 4393214 eddiebe
eddiebe's picture

Even if cold fusion does exist, or any other alternative, its build-out and implementation will depend on existing energy companies/ politicians allowing it to happen, and happen soon enough for a smooth transition to electricity based transport, industrial and other systems, so fossil fuels can be used for agriculture and plastics and other uses where only fossil fuels will do.

In my opinion, this should be already happening. A big change like that would be like trying to steer the Titanic away from the iceberg when contact with it has already been made. Our track-record as a species for acting responsibly concerning far-reaching and long-term decisions isn't good at all.

Sat, 02/01/2014 - 17:35 | 4391841 samsara
samsara's picture

Tylers... GREAT that you picked up Gail.

She knows her stuff. 

Sat, 02/01/2014 - 19:11 | 4392098 disabledvet
disabledvet's picture

more like "retard mongering at its worst." These numbers have already been disproven. They only go back to 2011...we've had a massive explosion in the Marcellus Shale alone that is still ongoing.
Plus she simply ignores the existence of hydroelectric power.
Ummm...yo woman, that's 80% of the State of Washington's power supply.

Can prices sure moonshot from here?
Sure...take one look at natural gas.
Following this moron's advice would have led you to the two dollar collapse price the very next year.

The fact of the matter is we have too much energy are being constricted and demand driven higher. This has been well documented here with all the London "price fixing" scandals, etc.

Regulators refuse to do anything about it...but I will say this wasn't true in the past. Post war America knew it had an energy crisis (one of the reasons for the defeat of Nazi Germany) and set about the difficult task of not being beholden to huge energy plays.

It may have failed...but not for lack of trying.
The US has the largest nuclear fleet in the world
The largest hydro-electric fleet in the world.
The largest coal production in the world.
The largest natural gas production.
We are now a net producer of oil for the first time since 1948.
Kinder/Morgan will be exporting oil from the Gulf Coast to California in 2015!

That is not a sign of an "energy crisis."
With Nissan selling an entry level all electric vehicle it's only a matter of time (5 years?) before the use of oil as a fuel source in the USA is pretty much de minimus.

Oh, and she forgot ethanol production as well.
Leaving out the commodity collapse of 2013 in your "energy analysis" is like leaving out "employment issues" during the Great Depression.

Sat, 02/01/2014 - 20:02 | 4392215 CrashisOptimistic
CrashisOptimistic's picture

You are so frequently misinformed about so many different subjects that I think most ZH folks have stopped bothering to note it.

Sat, 02/01/2014 - 20:27 | 4392282 zanez
zanez's picture

It seems pretty likely that most sensible hyroelectric capacity in the U.S. is already being used. Hydro accounted for 6.3% of electrical generation in 2010. Wind was 2.3%

Corn ethanol as a vehicle fuel remains one of the dumbest ideas around.

There was a "commodity collapse" in 2013? Possibly a correction in some commodities, not seeing evidence of a collapse.


Sat, 02/01/2014 - 21:43 | 4392438 BuddyEffed
BuddyEffed's picture

I wonder if she's been recommended for guest poster in the past?

Sun, 02/02/2014 - 01:41 | 4392971 Flakmeister
Flakmeister's picture

This is not her first offering at the Hedge...

Sat, 02/01/2014 - 17:38 | 4391844 debtor of last ...
debtor of last resort's picture

Infinite growth is just a farce as infinite money. Get used to it.

Sat, 02/01/2014 - 18:37 | 4392001 Bunga Bunga
Bunga Bunga's picture

Don't worry, this farce will stop when the planet blows up.

Sat, 02/01/2014 - 17:38 | 4391846 q99x2
q99x2's picture

The only reason the NWO would have given China all our jobs was if the MWO knew they would exterminate most of the people before energy usage destroyed the world.

We are all doomed..

Sat, 02/01/2014 - 20:20 | 4392260 negative rates
negative rates's picture

Doomed I say!

Sat, 02/01/2014 - 17:42 | 4391855 CrashisOptimistic
CrashisOptimistic's picture


Gail knows her stuff, and it's vaguely amusing that she said the cost to extract oil is so high -- and then transitioned immediately to describing the cost as something other than thin air printed dollars.  Clearly if civilization were about to be destroyed by oil scarcity, and it was possible to stop that destruction by printing money, then it would be printed.

But she phrases it in an different way to close that door to thought, as it should be closed.  That is the horror of the last 5 years.  Money has been shown to be meaningless.


Peripherally, let's keep in mind that the shield of the population's mind from awareness of this devastation coming is presently buttressed by the poster child of the abundance narrative -- the Bakken.

People wave hands over their heads about well decline rates and frantic drilling, but I have noticed a more subtle crusher, namely the pipeline companies can't build pipelines internal to NoDak.  The wells die too fast.  Trucks cart the oil from each well daily to railheads.  The folks who try to analyze logistics count drill rigs and maybe even pressure pumps for fracking, but no one really is counting the trucks and the diesel fuel they burn to do all that rapid commuting.  Note that the Bakken's oil is low in the diesel fraction, and the Eagleford is even lower.  (It's only our shaky definition of oil that lets this stuff be called that and now you know why WTI is still sniffing $100).

And so . . . war cometh.

Sat, 02/01/2014 - 17:50 | 4391885 El Vaquero
El Vaquero's picture

The question is, how are we going to fight that war with dwindling oil extraction?

Sat, 02/01/2014 - 17:57 | 4391898 CrashisOptimistic
CrashisOptimistic's picture

That is no question at all, sir.

When you cannot use weapons that consume oil, you use weapons that do not.  ICBMs with nuclear warheads.

Sat, 02/01/2014 - 18:55 | 4392053 El Vaquero
El Vaquero's picture

They do use oil.  The question is, how much in the way of oil derived products do they use for maintance?  The fuel likely uses petrolium derived substances, and I have no idea what the shelf life of the fuel is.  And nobody said that it had to be WWIII.  It could be Civil War II. 

Sat, 02/01/2014 - 19:44 | 4392167 OceanX
OceanX's picture

We assume a large arsenal of Nuclear Weapons, just like we assume the U.S. has 8,100 tons of gold...

Sat, 02/01/2014 - 20:00 | 4392209 El Vaquero
El Vaquero's picture

I live in nuclear country, so to speak.  I've met some of the people who maintain them, and infact, purchased a rifle from one of them.  I, for one, believe that they exist. 

Sat, 02/01/2014 - 19:43 | 4392168 OceanX
OceanX's picture

We assume a large arsenal of Nuclear Weapons, just like we assume the U.S. has 8,100 tons of gold...

Sat, 02/01/2014 - 17:43 | 4391860 Seize Mars
Seize Mars's picture

Are Jenna Bush's private wetlands open for public drilling?

Sat, 02/01/2014 - 18:10 | 4391934 bonin006
Sun, 02/02/2014 - 10:07 | 4393251 Seize Mars
Seize Mars's picture

LOL ya got me there

Sun, 02/02/2014 - 11:32 | 4393342 Disenchanted
Disenchanted's picture

I wouldn't drill that with your drill...

Sat, 02/01/2014 - 17:45 | 4391870 SmittyinLA
SmittyinLA's picture

When the state unilaterally adopts a "mass immigration forever" public policy eventually energy, water, food supplies aren't going to keep up with federal immigration desires.

Our problem isn't "not enough energy" but A public policy predicated on unlimited resources.

Sat, 02/01/2014 - 21:24 | 4392384 GeorgeHayduke
GeorgeHayduke's picture

It's not just a public policy predicated on infinite growth, but a public mindset across the board. The public is like a bunch of infantile kids living in their parent's basement who don't want to hear about the realities that exist outside. Our culture is predicated on the concept of consuming as much as possible before you die.

Anytime anyone has mentioned limits to growth since at least Reagan they get labeled as a Communist, Socialist, Marxist, environmental wacko, atheist, people hater, misanthrope, illuminati tool, etc... This board is filled with examples.

Sat, 02/01/2014 - 17:47 | 4391871 Seize Mars
Seize Mars's picture

Anyways listen up, knuckleheads.

Crude oil is a financial asset, not a real commodity. US Dollars also. Measuring one in terms of another is...well, not useful or telling.

Discuss amongst yourselves.

Sat, 02/01/2014 - 17:56 | 4391897 El Vaquero
El Vaquero's picture

Crude oil is a finite physical resource that we are consuming at an unsustainable pace.  While we could theoretically push the time that we depend on oil to the limits dictated by physics (EROEI = 1:1,) that the dollar system requires sustained exponential growth rather than a steady state, and ever increasing supplies of oil are the keystone to that ever sustained exponential growth tells you that pricing oil in dollars means that both will likely collapse in one way or another before EROEI=1:1 is reached.  (Just another way of stating what was in the article.)


The question that you should be asking yourself is, do you know where your last few meals were produced?  If not, you had better worry, because when this bitch blows and oil becomes really scarce in a rapid fashion, you won't have the requisite year or two of gardening under your belt to know what to do and what not to do.  It's better to fail at producing your food when there are other sources avaliable. 

Sat, 02/01/2014 - 18:34 | 4391994 Miffed Microbio...
Miffed Microbiologist's picture

What amazes me El Vaq is the amount of energy we waste on the production of conveniences boxed foods. What I grow in my garden or trade for my neighbor's produce is far less energy intensive. Our main expense is the electricity we use to pump water from our well. When our solar is paid off in a few more years that will decrease. I have never seen data on this but I am suspicious the calories from a standard microwaveable meal are less than what it took to create it. Plus I won't even touch the lower nutritional aspect.

Switching over from a centralized food production model to a local one would be extraordinarily painful. Just my disasters on a few crops I tried to grow experimentally has shown me one needs to practice many years to find what can be grown consistently in one's own region. Plants don't read gardening manuals.


Sat, 02/01/2014 - 19:21 | 4392121 El Vaquero
El Vaquero's picture

I cannot remember which article or lecture it was, but I have seen the numbers regarding energy used to produce and ship food vs the caloric value, and it is not pretty.  Some foods take 100 times more energy to produce and ship than they contain.  Think about the EROEI on iceberg lettuce that is grown and harvested using all sorts of mechanical energy consuming pieces of equipment, then shipped 1600 miles.  Even worse, think about that same iceberg lettuce that is shipped by air from the US to Britain. 


As for the nutritional value, well, it's not clear what the exact cause(s) are, but the crap that we eat has been declining for years.  Is it the heavy processing of the food?  Is it the fact that the soil has been depleted and we now rely on fossil fuel based fertilizer, which gives great growth, but probably lacks traces of vital nutrients?  Or is it the varieties that we grow?  We don't pick varieties for their nutritional value and flavor nearly as much as we pick varieties because all individuals will be ready to harvest on the same day, they can all be harvested mechanically, they ship well, they store well, etc...  Perhaps it is a combination of the above factors.


As for gardening, even if you know what you're doing, you can get knocked by the weather.  My neighbor has been gardening for longer than I have been alive, and we had two extreme weather events that taxed even her experience.  We had the 2nd hottest June on record with no precipitation, followed up a very wet July and one storm that literally produced cat1 hurricane force winds with hail and 2 1/2" or rain in less than an hour.  The repeated 100+ degree weather wiped out most of my Painted Mountain corn (the NM sun is brutal without repeated triple digit temps) and the storm lodged most of my Navajo Blue corn, (significantly reducing yields,) almost ripped some of my squash plants out of the ground and put holes in all of the foliage of everything.  The Sandia Hot and Chemayo chiles withstood it all like troopers though, and I still have onions, carrots, beets and chard in the ground that I'm letting go to seed, as well as several varieties of brassicas that I planted after the weather calmed down a bit.


This year, I will be better prepared for extreme weather events.  I am planting more cultivars of everything.  If something gets one cultivar, there is still a chance that another will survive.  I am also going to allow them to promiscously pollinate, and if it does not survive long enough to produce seed, I do not want it in my garden.  In fact, at about noon today, I picked up 3 new cultivars of localized pole beans, one new cultivar of common bush bean, one new cultivar of tepary bean, two new cultivars of (flour/posole) corn and two new cultivars of squash.  I also expanded the garden by about another 500 ft2.  I have seeds from melons that were originally cultivated by the pueblo that used to literally be right where I am sitting, as well as related varieties from up and down the Rio Grande valley that I am itching to try out along with some Navajo squash.  I have blackberry seeds from a local farmer, so if I can get those to germinate, I know they'll handle my climate.  While I don't stick to local cultivars only, they are what I do try to make the bulk of my seeds.  I'm adapting the plants to my climate and soil rather than adapting my environment to the plants. 

Sat, 02/01/2014 - 22:22 | 4392545 StychoKiller
StychoKiller's picture

Soil itself is alive -- with micro-organisms and worms, etc.  Time to investigate Aquaponics more...

Sat, 02/01/2014 - 23:30 | 4392746 El Vaquero
El Vaquero's picture

I didn't mean to give the impression that I don't tend to the soil, because I do.  What I don't try to do is mess with the PH, the tilth below a few inches, etc...  What I do try to do is ensure that all of those microbes and whatnot are healthy.  Lately, I've been looking into mycorrhiza as a beneficial soil organism. 


The problem with aquaponics, at least for me, is that I live in a desert.  There really is no good way for me to do it that doesn't require energy.  While I can hit the water table where I am with a shovel, it is still a desert nonetheless, and I'm better off with drought adapted crops.  9" of precipitation per average year, hot summers, cold (not to people in MN or WI!) winters is my environment. 

Sun, 02/02/2014 - 16:58 | 4394036 spine001
spine001's picture

Try what they use in the Kibutz in Israel for desert aquoponics. Take a large bottle of pop, cut it in half, fill the bottom half with water and then cover it with a larger Gallon? size bottle also cut in half, and place each of them by the plant you want to irrigate, the water in the lower bottle evaporates, touches the upper bottle and comes down to earth where the vapor condenses and waters the roots of the plant. Then set up a system of hoses going to each bottle using gravity to keep them all filled at the desired level using the siphoning effect.

Sat, 02/01/2014 - 20:05 | 4392218 Notarocketscientist
Notarocketscientist's picture

Every time I go out I come back with a box or two of canned food --- I am building up a substatial stockpile to help bridge to the point of self sufficiency on our small farm --- and to have a back up food supply if I have a crop problem.

As Gail says, this cannot go on for much longer - it will unravel no later than 2015 - fires are starting everywhere, UKIP is leading the UK poles and want out of the EU (obviously people are not buying the 'recovery' lie in the UK) - Ukraine, Syria, Argentina, Venezuela, Libya, Iraq, etc


Sun, 02/02/2014 - 10:16 | 4393259 Seize Mars
Seize Mars's picture

El Vaquero

Crude oil is a finite physical resource that we are consuming at an unsustainable pace.

... that the dollar system requires sustained exponential growth rather than a steady state, and ever increasing supplies of oil are the keystone to that ever sustained exponential growth tells you that pricing oil in dollars means that both will likely collapse in one way or another before EROEI=1:1 is reached... 

Well you are approximately half right.

You got the dollar part right. As for oil, it is not scarce. Sorry, it just isn't. I think you'll agree that what we desperately need is for a scarce commodity to be expressed as a "price" in terms of another scarce commodity. That way the true economic cost can ripple through society and cause people to organize their capital accordingly.

So whereas the USD is obviously not scarce, neither is crude oil, which is the real problem. So the "malinvestment" of vonMises is even worse than he could have imagined.

Remember, the apparent scarcity of crude is a license for them to print more USD. So it is to the advantage of the money printers to have crude appear as if it is scarce. Capiche?




Sun, 02/02/2014 - 11:31 | 4393354 Flakmeister
Flakmeister's picture

Completely muddled logic that becomes blindingly obvious once you express the price of oil in terms of another commodity, e.g. gold...

Sun, 02/02/2014 - 12:03 | 4393400 Seize Mars
Seize Mars's picture

Um, is gold manipulated?

Sun, 02/02/2014 - 12:16 | 4393423 Flakmeister
Flakmeister's picture

Pick wheat, iron ore, anything you like...

BTW, when you look at all the various commodity price ratios you realize that the gold price is hardly manipulated in a manner that results in a long term misvaluation   (And yes, shorts and longs can be squeezed in the short term, no argument there)

Sun, 02/02/2014 - 13:24 | 4393562 Seize Mars
Seize Mars's picture

The more manipulated a commodity (stock, whatever) the more of a shit show our economy is, because it causes an epic miscalculation of where capital should be invested. Agreed?

Sun, 02/02/2014 - 13:48 | 4393622 Seize Mars
Seize Mars's picture


By the way you're awesome

Sun, 02/02/2014 - 12:51 | 4393502 El Vaquero
El Vaquero's picture

Oil is not scarce.  Easy to extract oil is becoming very scarce.  100 years ago, we could drill an oil well and oil would come gushing to the surface on its own.  It eventually got to the point where we had to pump it.  Other methods of extracting it came about too.  So, if you think that horizontal drilling and fracking, or giant floating platforms at sea are on the same level as drilling an oil having oil come gushing to the surface, you are deluding yourself.  All of the new technology going into oil extraction takes energy.  The evidence of all of this is right before your eyes, and telling yourself that the earth has a nougat core of oil for us to rely on forever is wrong, and we will run out of oil that we can afford to extract regardless of your opinion on the matter. 


The bottom line is EROEI.  If it takes more than one barrel equivalent of energy to extract one barrel of energy, you had better either be using a non-oil source of energy to extract oil, or you will run out of oil very quickly.  If 50% of your economic input goes towards energy extraction due to a very bad EROEI, your economy will crash.  Physics trumps Paper Money 100% of the time. 

Sun, 02/02/2014 - 13:34 | 4393591 Seize Mars
Seize Mars's picture

I think your thought process is nearly right. But I just don't believe the scarcity myth, or its cousin, the "easily extractable stuff is becoming scarce." I just don't buy it.

The bad guys need the appearance of scarcity badly. Why? Because it makes the USD more valuable, and hence printable. And that's the real game.

Crude Scarce = High USD Price per bbl = Can Print More USD

Crude Plentiful = Low Price per bbl = Can't print any more

You're right about physics trumps paper money. That's true. Inescapable.

Sun, 02/02/2014 - 13:54 | 4393631 El Vaquero
El Vaquero's picture

High energy prices -> expensive necessities -> societal collapse -> chaos and rolling guillotines.  You don't want to be blamed for what happens in a country where there are hundreds of millions of guns when EBT and Super Bowl (bread and circuses) finally cease.  Those boys at the energy companies don't want to be separated from their heads.  If anything, they're lying to make it appear that they can extract more than they really can.  This makes their companies appear to be more valuable than they really are, which makes stockholders happy.  It doesn't mean that they haven't held back on some of their cheaper to produce oil fields, but those will be a flash in the pan.  Resource depletion is a very real phenomenon, and not just with oil.  Look up the Oglala aquifer for another example.  There are too many of us who consume too much.  Even those of us who know what is coming are going to be shocked when it hits. 

Sun, 02/02/2014 - 14:56 | 4393739 akak
akak's picture

El Vaquero, I like your posts --- they are consistently logical, insightful, well-worded and to the point.  Good job!

Sun, 02/02/2014 - 16:05 | 4393923 Miffed Microbio...
Miffed Microbiologist's picture

I second the motion. It is very pleasant to read such thoughtful posts EV and I am glad you are part of this community.


Sun, 02/02/2014 - 21:03 | 4394483 Flakmeister
Flakmeister's picture

And you know why Energy threads are among the most civilized on the boards here, don't you....

Sat, 02/01/2014 - 20:49 | 4392320 zanez
zanez's picture

Crude oil is a commodity. I can get a 5 gallon pail of it and use it to clear brush, or drown my neighbor's cat. Any value whatsoever assigned to said commodity is a financial asset.

Sat, 02/01/2014 - 17:57 | 4391888 Yen Cross
Sat, 02/01/2014 - 18:26 | 4391969 Bear
Bear's picture

I hope you're right

Sat, 02/01/2014 - 18:34 | 4391987 Yen Cross
Yen Cross's picture

  I'm flabberghasted.  Where in the fire of Hades' have you been Bear?

  You're missed!

Sun, 02/02/2014 - 07:25 | 4393149 Bearwagon
Bearwagon's picture

Not really, I'm afraid. Germany has experience with that technology. It has been disillusioning:

Sat, 02/01/2014 - 17:53 | 4391892 greatbeard
greatbeard's picture

From the charts and graphs posted, the solution is obvious, we need to stop buying shit from China and India out and snuff those slimy bastards back to growing rice and cooking over buffalo shit camp fires.  Then we could have the good old USA of the 50s back.  It is imperative that we delay on onslaught of the Tverberg drop off until after, say, 2045.  At that point I'll be 90 with not a lot of future.  But as of now, I'm in the market for another fishing boat, one power by petrol.  By my way of thinking, petrol for my fishing skiff is a bit more important than some dark skinned foreigner wanting to drive his moped into town.  There is not shit in town that they can't do back in the rice paddy.

Sat, 02/01/2014 - 17:53 | 4391893 Future Jim
Future Jim's picture

What caused the price of oil to plummet throughout the Reagan administration? Maybe we should do that again.

On a side note, Clinton inherited cheap oil, which is one of several compelling resaons why Clintonomics is a myth.

Sat, 02/01/2014 - 18:01 | 4391910 CrashisOptimistic
CrashisOptimistic's picture

No.  Reagan inherited oil flow from Alaska.

Clinton inherited oil flow from North Sea.

Don't think money thoughts when looking for why things happen.  Think oil thoughts.

Nothing else matters.

Sat, 02/01/2014 - 20:45 | 4392314 samsara
samsara's picture

What "Caused" the price plummet in the Reagan admin was Poppy Bush making a deal with the Saudi to pump and pump and flood the market.

See,  The Saudi's at the time had a cost of about $2 a barrel to produce their oil,  while RUSSIA on the other hand had something like a $19 a barrel cost to extract.

Oil(and Gold) were the main things that Russia produced at the time for cash flow. 

We bankrupted them by SA selling them into the poor house.

(oh, and Canada helped by dumping their Gold at the same time for dirt prices.  Remember Reagan's St. Patty's day trip to Canada??)

They Did it because;

 THEY(S.A.) HAD THE OIL to Pump (Today They DON'T !!!)


To bankrupt RUSSIA.  (and they did btw)

Sat, 02/01/2014 - 21:53 | 4392454 GeorgeHayduke
GeorgeHayduke's picture

Good point. Plus the country adopted an attitude of screw future generations because it's Morning in America. Go forth and consume...everything. And for the most part we did.

Sat, 02/01/2014 - 22:51 | 4392637 yt75
yt75's picture

Yes exactly, see below for instance about that :

(and it also almost broke US domestic prod)


Sun, 02/02/2014 - 03:03 | 4393040 Flakmeister
Flakmeister's picture

A combination of things...

Study this figure

The oil shocks of the 70's caused a massive shift away from oil-fired electricity generation which cut demand, add in the ramp up of Prudhoe Bay and the  North Sea and a very deep recession.... 

Look at US gasoline consumption

All the while vehicle miles travelled rose

Little appreciated is that European consumption peaked in 1980...

Can it happen again?? The last great "easy" oil fields ramped up in the 80s, that ain't gonna happen again...

It should be clear that the efficiency measures enacted in the Carter Era had a real effect....

And yes, Slick Willie benefited greatly from cheap gas....

Sat, 02/01/2014 - 18:03 | 4391914 lasvegaspersona
lasvegaspersona's picture

a real long as there is plenty of jet fuel for my Leer I'm gold?

Sat, 02/01/2014 - 18:16 | 4391942 CrashisOptimistic
CrashisOptimistic's picture

"8. Demand Reduction. This really needs to be the major way we move away from fossil fuels. Even if we don’t have other options, fossil fuels will move away from us. Encouraging couples to have smaller families would seem to be a good choice."


I call this the "discretionary narrative".  It presumes people can make a choice and en masse actually impact something.

It's wrong.  The simplest Occam's Razor path to Demand Reduction is widespread death.  There are lots and lots of ways to make that happen.

Sat, 02/01/2014 - 19:35 | 4392154 El Vaquero
El Vaquero's picture


The simplest Occam's Razor path to Demand Reduction is widespread death.

And that is one very, very scary thought.  You and I might get caught up in that, whether it be through starvation, disease, a 500kt warhead dropping in my lap or being killed by a zombie horde of locust like sheep, or some other thing that I have not thought of.  It is going to happen one way or another, whether we cause it through war or nature causes it because we've been raping the land for so long.

Sat, 02/01/2014 - 19:51 | 4392182 MrPoopypants
MrPoopypants's picture

According to the charts above, the US and Europe have already reduced oil demand from the 2007 peak. There is much "discretionary" cutting yet to be done, and will take place en masse as soon as $10/gal gasoline gives the signal for people to *choose* to use less.

Sat, 02/01/2014 - 20:09 | 4392231 CrashisOptimistic
CrashisOptimistic's picture

This perspective is part of the discretionary narrative.

There is a level of oil consumption below which you cannot go and still feed 7 billion.  $10/gallon gasoline ends transport of a lot of things that are not human -- like spare parts for the trucks carrying food.

And hydroelectric plant spare parts.  And nuclear plant spare parts.

There is an avalanche threshold for spare parts transport, and when you hit that you look to see who else is consuming the oil you need, and you act to eliminate them.

Sun, 02/02/2014 - 11:53 | 4392978 Flakmeister
Flakmeister's picture

Eurozone demand peaked in 1980...

Here is the German oil graph

The thing the Germans get no credit for is that they clearly know how to play the long game... It happens when you pay the price of losing two World Wars....

Sat, 02/01/2014 - 18:05 | 4391918 James
James's picture

The instalation of Solar panels need to be site specific to its demand of power. It will not be successful building huge commercial arrays as the end user will still want to use power wastefully. ie electric stoves, AC, (that's a big one) water heaters,etc.

Lighting will have to be LED. If your bulb is hot in use you are wasting electricity.

Refrigerators are available @ 12 -24 volt that use a miniscule of energy compared to current design.

These have up to 6" of styrofoam and the unit is a chest opened @ the top. Everytime you open your frig ALL the established cooling has just dropped out onto your floor and then forced to run to make up for you opening the door. Wasteful.

Water heaters could be a "batch" system simply placed in the sun. Does'nt matter the climate - just the sun. In 1956 the power co's went door to door offering "free" water heaters to customers in Fl. who were using "Batch". Wrong move.

R-30 insulation or more should be mandatory. Currently it's half that if they have any at all.

Wind is so site specific it is not practical at all. You need 14mph wind constantly for them to work so you are talking high elevation where few live. 23,000 wind turbins were took off-line last year world-wide.

Every ones domicile should currently be Solar for most, if not all, of their use. Heat and AC are going to be the challenges so that is why thick insulation is needed.

The best way to save energy is not to use it wastefully. Energy spent to heat or cool has to have the ability to store it in the Mass of the building or equipment just keeps cycling, You need a mass of concrete,steel,anything that will absorb and hold energy.

Years ago Calif. burned the so called waste of rice production. Now that waste is formed into building blocks w/a high R- factor.

Strawbale homes have a R-factor of 60 so any energy used goes a long way.

We just don't build right.

Sat, 02/01/2014 - 18:16 | 4391935 Yen Cross
Yen Cross's picture

  An sodium reactor doesn't require an "Solar display". I was simply presenting an " hybrid<> configuration".

Sun, 02/02/2014 - 07:40 | 4393156 Bearwagon
Bearwagon's picture

Are you aware that you are talking of a thermal breeder reactor? It runs at enormous temperatures, requiring special materials. As far as I know, the problem of inter-granular cracking in all metal surfaces exposed to the salt has not been solved as of today. That is not a new or advanced reactor-design either - it is scrap from the sixties:

Sat, 02/01/2014 - 18:12 | 4391936 HelluvaEngineer
HelluvaEngineer's picture

Good luck convincing the yuppies that they need an earth-bermed house.

Sat, 02/01/2014 - 19:46 | 4392169 El Vaquero
El Vaquero's picture

Hey, in my neck of the woods, you *expect* to pay more if a house is made of mud! 


(Real adobe homes do have a very nice feel to them, at least if you have been exposed to them ever since childhood.  They tend to stay cool in the summer and hold heat very well in the winter.)

Sat, 02/01/2014 - 21:42 | 4392433 James
James's picture

Adobe, when made thick is an excellent choice as it works as a "flywheel" effect.

The deserts are hot in the day and cool at night. Once cooled the heat is pushed in at night when needed and during day heat the heat is pushing the stored cold in.

Sat, 02/01/2014 - 20:39 | 4392306 samsara
samsara's picture

And THAT is why all talk about "POSSIBLE, WE COULD, IF WE ONLY WOULD...."  makes all those PV panels over the southwest, WindMills everywhere, Frozen Methane Hydrates... all a Pipe Dream.

WE AIN'T Gonna do it even if it WERE possible(which it ain't). 

We will keep doing what we are doing until we can't and then we won't.


Sat, 02/01/2014 - 19:57 | 4392198 Matt
Matt's picture

Also, we have 4000 pound automobiles in order to survive crashes with the other 4000 pound automobiles. Once we get automated cars to result in >90% reduction in crashes, we can switch over to 100 pound velomobiles instead. Operate those at 40 miles per hour, and you could be using 1/20th the energy as a conventional SUV.

Forget about hybrid cars and battery powered electric cars, which have tremendous embedded energy. Trolley trucks and buses may be a viable option.

Also, more tele-commuting and more living within walking distance of the place of employment.

It's too bad humanity wasted it's huge one-time wealth of oil on automobile culture, cruise liners and jet planes instead of trying for something awesome, like an orbital solar array.

Sun, 02/02/2014 - 10:53 | 4393298 My Days Are Get...
My Days Are Getting Fewer's picture

How are you going to tele-comute to your job in a foundry making those durable products which have withstood the test of time.

Sun, 02/02/2014 - 12:42 | 4393479 Matt
Matt's picture

"tele-commute or live within walking distance ..."

If you cannot do A, you could do B instead. Or you can pay ever increasing portions of your wages to travel to and from work every day, if you prefer.

Sat, 02/01/2014 - 18:09 | 4391929 Manipuflation
Manipuflation's picture

Mrs. M is not a sacarstic asshole such as myself but every once in a while she comes up something good.  I had to laugh.

Sat, 02/01/2014 - 18:11 | 4391932 Rukeysers Ghost
Rukeysers Ghost's picture

This piece looks like a retweeking of Hubberts Peak Oil nonsense. There is always someone claiming doom and gloom on this issue that later looks like a horses ass after none of the predictions come true. Her "Forecast of Future Energy Supplies and their Impact" reads like the same phoney panic pieces I was reading in the 70's about how by 1985, we would be living in a dystopian future. What all these geniuses miss in their predictions is that technology and circumstances constantly change and evolve.

Sat, 02/01/2014 - 18:17 | 4391949 lakecity55
lakecity55's picture

I have not yet discarded abiotic oil; the Russians spent a lot of research on it.

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