Peak Oil News: 08/01/2005 - 09/01/2005

Wednesday, August 31, 2005

An Oil Panic In Plain Sight

HoweStreet.com

The Rude Awakening PRESENTS: Hurricane Katrina smashes "Energy Alley," a concentrated area of oil production in Gulf of Mexico that supplies about 35% of America's domestic oil.

By Sean Brodrick

- Hurricane Katrina smashes "Energy Alley," a concentrated area of oil production in Gulf of Mexico that supplies about 35% of America's domestic oil.

- White House says oil will get cheaper, but makes hush- hush plans to increase the Strategic Petroleum Reserve by 42% to ONE BILLION barrels of crude. Why are they so eager to add to the SPR when oil prices are high?

- Saudis reveal they won't be able to meet oil demand – first time EVER they've admitted the awful truth

Hurricane Katrina delivered a devastating blow to America even before it slammed into Louisiana. The Massive storm smashed through "Energy Alley," a concentrated area of oil rigs off the coast that supply about 35% of America's domestic oil production and 20% of its natural gas. It damaged much of our nation's oil production.

At the same time, workers rushed to shut down the offshore Louisiana Offshore Oil Port, which processes loads from tankers too large for mainland ports. The LOOP is the nation's largest oil import terminal, handling 11% of U.S. imports. And refiners shut down more than a million barrels a day of production as they braced for the impact from the monster storm. Those refineries will probably be out for at least two weeks, setting the stage for a potential gasoline shortage.

Panicked oil traders are pushing oil prices over $70 per barrel. And now for the really scary part. A devastating hurricane strike at America's oil and gas operations in the Gulf of Mexico is just one of the major forces that could send oil to $80 ... $100 ... $150 a barrel. Other forces that could send oil prices surging are potentially much more serious...and permanent!

The Saudis are the "central bank of oil," right? So how come the central bank is scrounging for loose change under the couch cushions?

Earlier this month came news that Saudi Arabia hired five Rowan jackup oil rigs for drilling offshore oil wells on a three year contract. Those rigs are currently under contract in the Gulf of Mexico, so that means Saudi Arabia outbid somebody to get those rigs – and rig rates have already run up to obscenely high levels – 30% to 50% more than a year ago.

Drilling for oil underwater is very expensive. You'd expect the Saudis to be drilling out their cheapest oil first. Don't they have a desert full of this stuff? So why are they suddenly digging deep for underwater oil, and willing to pay a premium to do it?

Unless... maybe the Saudis don't have as much oil as they say they do.

We already know that the Saudis have confessed that OPEC won't be able to meet western oil demand in 10 to 15 years. I'm starting to think they might come up short a lot sooner than that.

Are the Saudis lying? Well, at least it seems like they're not telling the whole truth. What's more, I believe there's a whole lot our own government isn't telling us. I'll get to that in a moment. First, some ugly facts...

· The world uses a BILLION barrels of oil every 12 days. Do we find a billion barrels of oil every 12 days? NO! In fact, if everything goes perfectly, we'll find just 30 million barrels of oil in the same time period. If things go badly, we'll find less. Much less.

· The global depletion rate runs at least 5% a year, perhaps much higher , as once-reliable sources of oil are in serious decline. Oil production in Britain fell the steepest of any country last year, with production in the once-prolific North Sea falling by 10% (230,000 barrels per day) last year ... Production in Alaska's Prudhoe Bay has fallen 75% from its peak in 1987 ... Iraq's oil production is still half of what it was before the war ...Mexico's production is declining so quickly it will have to start importing oil in the next 10 years!

· The U.S. Energy Information Agency has fallen in line with the International Energy Agency and admits that oil demand will exceed supply starting in the fourth quarter of this year. Total world demand is expected to be 86.4 million barrels per day, according to the EIA, while total world supply is expected to be 85.4 million barrels per day. The EIA ups the ante by saying there will be a shortfall in the first quarter of 2006 as well.

Publicly, the White House urges calm and predicts that oil prices will retreat from their current high levels. But privately, the U.S. government is quietly planning to add to existing oil reserves at a furious pace.

Squirreled away in new energy legislation is a directive to increase the Strategic Petroleum Reserve from 700 million barrels (70 days' supply of imports) to ONE BILLION BARRELS. They're adding to the SPR when oil prices are sky- high. What are they afraid of?

A confidential source in the Department of Energy gave me the scoop on the addition to the SPR. This stunning new directive was placed inside the 1,724-page Energy Policy Act of 2005 without any fanfare whatsoever – it's hidden in plain sight. And the mainstream media is too busy going to beltway cocktail parties to notice.

This 42% jump in reserves is so huge, the government doesn't even have a place to put it all – yet. The plan is to fill the SPR to capacity with a minimum of market disruption or undue influence on the market, blah-blah. If you're planning to fill the SPR when oil is over $60 per barrel, you aren't planning on getting that oil on the cheap.

I don't know what is motivating the Bush administration to boost petroleum reserves. But I do know that two oil men are in the White House right now. They probably have access to raw data on America's oil fields – including depletion rates – that the rest of us don't. Again, what are they afraid of? I'm certainly not going to buy the "don't' worry, be happy," line peddled by the White House.

Still, there are plenty of people still willing to push the government line. An analyst recently quoted in a Bloomberg story tried to push the idea that oil is still cheap, explaining: "A barrel of Starbucks latte would cost you $1,500, compared to a barrel of crude, even at $66 a barrel."

Ri-i-i-i-i-ight! Starbucks coffee is a luxury – that's why they can charge so much for it. Is oil a luxury? Not right now. But it might be down the road.

I believe we're careening toward a good ol' fashioned oil panic. I believe the government knows a lot more than it's letting on. And I believe anyone who doesn't invest for the coming energy emergency is a bloody fool.

The time to take action is now. Today's energy crisis is transforming the world – from geopolitics to the financial markets to the gas pump to the production cost of almost every product we consume on a daily basis.


Tuesday, August 30, 2005

The End is Nigh

American Scientist Online

Review by David Ehrenfeld

The Long Emergency: Surviving the Converging Catastrophes of the Twenty-First Century.
James Howard Kunstler. x + 307 pp. Atlantic Monthly Press, 2005. $23.


James Howard Kunstler begins The Long Emergency with the hope that "the American public will wake up from its sleepwalk and act to defend the project of civilization" while there is still time. "Throughout this book," he writes, "I will concern myself with what I believe is happening, what will happen, or what is likely to happen, not what I hope or wish will happen." The reality that our society is currently refusing to face, Kunstler says, is that time is just about up for industrial civilization as we have known it.

Kunstler's thesis is straightforward: Malthus was right, but cheap oil has postponed the day of reckoning, creating a century-long "artificial bubble of plenitude" and generating a host of intractable problems partly or entirely related to our prolonged energy spending spree. These problems include serious damage to our agricultural infrastructure, global climate change and the reorganization of living places into unsustainable suburbs and cities. Now cheap oil is disappearing fast, leaving only the problems behind.

What sets The Long Emergency apart from numerous other books on this theme is its comprehensive sweep—its powerful integration of science, technology, economics, finance, international politics and social change—along with a fascinating attempt to peer into a chaotic future. And Kunstler is such a compelling, fast-paced and sometimes eloquent writer that the book is hard to put down.

Beginning with the story of Edwin L. Drake, who drilled the world's first oil well in northwestern Pennsylvania in August 1859, Kunstler takes us through the development of the global oil-based economy of the 20th and early 21st centuries. He carefully traces the origins of the idea, first proposed by geologist M. King Hubbert, that oil consumption by modern industrial society will draw down current and potential supplies in a predictable way. Hubbert's 1956 prediction of the date of "peak oil" production in the United States (which he put at sometime between 1966 and 1972) was strikingly accurate—the peak occurred in 1970. After Hubbert's death in 1989, the distinguished petroleum geologists Colin Campbell and Jean Laherr�re, Princeton geologist Kenneth Deffeyes, University of Colorado physicist Albert Bartlett and others adapted his model and applied it to global oil production, yielding a prediction that the global peak would occur between 2000 and 2010.

As pointed out by Richard A. Kerr and Robert F. Service in the July 1, 2005, issue of Science, petroleum geologists tend to accept this "pessimistic" prediction of the date when the global peak will be (or has been) reached, whereas "optimistic" dates farther in the future are being advanced primarily by resource economists. Kunstler sides with the geologists, and his fast-paced but detailed discussion of the economics of oil supports this position. In his chapter "Geopolitics and the Global Oil Peak," he comes to grips with a complex mix of elements: Middle Eastern and Islamic nationalism, terrorism, Chinese industrial growth and the overwhelming problems of Russia, the world's second-largest producer of oil. These are set against a backdrop of diminishing supply, as one country after another, including Saudi Arabia, passes its oil peak. Kunstler's explanations of why the Saudis can no longer control world oil prices (they lack the reserves to increase production much beyond what they are already pumping) and of the immense significance of that loss of control are particularly insightful. American politicians have not yet grasped this new reality.

The book's lengthy discussion of the alternatives to cheap oil that are so beloved by techno-optimists is straightforward and sobering. Kunstler gives all of the alternatives a critical but fair inquiry, from conventional energy sources such as coal and natural gas, through oil shales and tar sands, synthetic oil, renewable energy (including wind, solar and hydroelectric power and biomass), nuclear fission and nuclear fusion, hydrogen, thermal depolymerization (turning organic waste into oil), methane hydrates and even zero-point energy.

Most of these technologies founder on "the classic problem of energy economics: energy returned over energy invested (ERoEI). "The figure in the case of tar sands and oil shale is approximately three barrels of oil produced for every two barrels of oil-equivalent invested. In the case of ethanol produced from agribusiness corn or sugar cane, the ratio may be less than one. Some alternatives, such as methane hydrates, are dangerous to handle. Hydrogen is not a primary fuel: Its production requires considerable energy. Also, because of the low density of hydrogen gas, it must be stored and transported under high compression, or liquefied at very low temperatures, or combined with other compounds. Each of these options costs still more energy, and they introduce an assortment of complications and hazards into the delivery system. Although hydrogen will have its uses, Kunstler says, his verdict is unequivocal: "There is not going to be a 'hydrogen economy.'" Nor is he sanguine about such far-out schemes as a process for deriving zero-point energy from the dark matter of the universe; he reminds us that "A useful maxim in engineering states that when something sounds too good to be true, it generally is not true."

Kunstler's moderate treatment of nuclear power (fission) has angered some environmentalists. I think he makes a good case, however, that during the transition period to a post-petroleum economy, the United States, which produces much of its electricity from a rapidly declining supply of natural gas, will not be as well off as France, which gets 80 percent of its electric power from nuclear energy. Nevertheless, he does not see nuclear power as more than a short-term stopgap. Its ultimate limitations come first from safety issues with regard to plant operations and the disposal of waste fuel (although he points out that coal has cost far more lives than nuclear power, especially in the West). Second is the large amount of oil needed to mine and process nuclear fuel and to build and maintain nuclear plants. And the third, formidable objection Kunstler makes is that "Atomic fission is useful for producing electricity, but most of America's energy needs are for things that electricity can't do very well, if at all. For instance, you can't fly airplanes on electric power from nuclear reactors"—although, as he notes, the U.S. military has tried.

Kunstler describes a host of natural disasters that will interact with the energy crisis to cause social upheaval on a global scale. No country will be exempt, he says. Some of these disasters, such as climate change, are the direct result of our profligate use of cheap energy. Others, including the widespread shortage of fresh water, have been greatly augmented by the drain on resources brought about by the explosion of high-oil-input agriculture, industrialization and changes in living habits. All of those natural disasters, however, including the emergence of new infectious diseases and the re-emergence of old ones, will be much harder to cope with when cheap energy is no longer available. Our efforts will also be confounded by diminishing returns on technology and by "technological regress—the loss of information, ability, and confidence."

The Long Emergency is more than a list of disasters, present or impending. It is an attempt to understand how we got to where we are. Nearly 100 years of cheap oil have allowed us, even prompted us, to construct an economic and social system that depends utterly (often without our knowledge) on a continuous, never-failing energy subsidy. The system cannot stand on its own feet. It is unstable, lacking internal restraints and negative feedbacks, and most of all it undermines all stabilizing alternatives, such as diverse small businesses and local community support systems. Kunstler's understanding of history and economics helps him delineate this clearly.

My only complaint about the book is that it lacks an index, which is inexcusable for a text so crammed with names and facts. Kunstler's use of entropy as a synonym for social disorder may bother readers who prefer that the term be reserved for discussions of thermodynamics, but an accepted definition of the word is "inevitable and steady deterioration of a system or society."

One question that most readers of this review will ask is, When will the coming collapse occur? As Kunstler notes, Deffeyes—perhaps not entirely in jest—has predicted on National Public Radio that the global oil peak will occur on Thanksgiving Day, 2005, with "'an uncertainty factor of only three or four weeks on either side.'" But the closest thing to a hint of Kunstler's position on the subject is found in his remark in the last chapter that "The denizens of Bergen County, New Jersey, or Fairfield County, Connecticut, today may never believe how desperate their localities may become in 2025." He is probably wise to be vague. As the great biochemist Erwin Chargaff remarked in his 1978 autobiography, Heraclitean Fire, "On the whole, professional pessimists prove right at the end if one does not hold them too tightly to a time scale."

The last (and longest) chapter of The Long Emergency is also the most innovative and controversial one. Having made a powerful case that it is too late to avoid serious trauma, Kunstler speculates on what life will be like during the painful transition period, as cheap petroleum wanes. The question is well worth asking, if only to stimulate creative thinking about alternatives to a high-energy lifestyle. The book is not a survivalist tract, but Kunstler argues persuasively that life will be better in some geographic regions of the country than in others and better in some kinds of communities than in others. Factors such as the availability of water, the degree of dependence on automobiles and air-conditioning, the regional tolerance for violence and the persistence of strong communities lead him to conclude that the states of New England, the mid-Atlantic, and the upper Midwest that make up the "Old Union" of the Civil War period, along with the Pacific Northwest, will fare much better than the Southwest, the Rocky Mountain states and the Southeast.

Within each region, however, conditions will not be uniform. Kunstler, whose earlier book The Geography of Nowhere established him as heir presumptive to the intellectual legacy of Lewis Mumford, describes America's automobile-dependent suburbs as "the greatest misallocation of resources in the history of the world." It is the suburbs, he thinks, that will suffer the most during the coming energy crisis. (I concur, having taught the same message in field courses in suburban New Jersey for 30 years.) And cities, with their skyscrapers and total food dependence, will not, Kunstler claims, be far behind the suburbs in misery.

There is much more in the final chapter than I can do justice to in a review: The many topics discussed include, among others, the new economy and new commerce that will accompany the end of oil-dependent consumer culture (he predicts the demise of the chain stores and the rise of scavenging), possible political fragmentation of the nation, changes in education, the end of romantic childhood and changes in race relations. The picture he paints is incomplete—he doesn't say what will happen to health care, the arts or entertainment in the long emergency—but there is material enough to provoke scientists and laypeople alike into considering what lies ahead.

Kunstler, like George Orwell, understands that being honest about the past and present is the only way to prepare ourselves for an uncertain future. Civilization, he believes, will survive the end of cheap oil, but not without great loss. "How many ... familiar things in time may go?" he wonders. "What will abide in our collective memory?" Not all readers will accept his answers to these questions, but I think we must be grateful to him for showing us the need to ask them.
Reviewer Information

David Ehrenfeld is a professor of biology at Rutgers University. He was the founding editor of Conservation Biology and is the author of a number of books, including Swimming Lessons: Keeping Afloat in the Age of Technology (2002) and The Arrogance of Humanism (1978), both from Oxford University Press.


Markets can't create oil: U.S. needs a real national energy policy

The Register-Guard

The United States has bet its economic future on the ability of market forces to take care of energy supply problems. The current run-up in oil prices is a result and, according to free-market ideology, a corrective reaction will eventually follow: Growing demand has caused prices to rise, and high prices will encourage conservation, innovation and increased production. But the invisible hand of the market promises to slap Americans in the face before it puts cheap gas in their tanks.

A laissez-faire approach to energy relieves people and governments of responsibility to avoid waste or plan for the future. Congress and the president can approve an energy bill stuffed with subsidies and pork, and declare their work done. The 20-year absence of improvements in the fuel efficiency of the nation's cars and trucks can be accepted as a rational response to consumer preferences. A faith in the power of markets to optimize the allocation of resources leads to a belief that any meaningful intervention in the self-balancing mechanism of supply and demand is futile at best, harmful at worst.

But as the price of gasoline edges toward $3 a gallon, it's time for Americans to start asking serious questions: What if energy - specifically, petroleum - were subject to geological constraints as well as market forces? And what if the world oil market operates in ways that put the United States at a permanent disadvantage?

Evidence supports both these possibilities. Oil discoveries peaked worldwide in the early 1960s and have been declining ever since; oil is now being consumed at about twice the rate of discovery. Most oil being pumped today was found more than 30 years ago; the last massive oil field discovery came in 1968.

High prices will trigger more exploration and will make previously marginal oil fields profitable, but they can't bring new resources into being. The world consumed an average of 84 million barrels of oil each day in 2002, up from 79 million in 2001. The daily production capacity of old oil wells declines by about 4 million barrels a year worldwide. Each year, to satisfy growing demand and compensate for depletion, the world must increase its daily oil-production capacity by about 6 million barrels - the equivalent of adding two new Venezuelas annually.

As Chevron, the United States' No. 2 oil company, says in its advertising, "the era of easy oil is over." World oil production will peak eventually, creating a seller's market for increasingly scarce supplies. Declining world oil production will have far-reaching economic and social consequences for  which the United States is unprepared.

The transition to a seller's market will also find the United States at a growing disadvantage. Domestic production peaked 35 years ago and has been declining ever since. Consumption has continued to increase, requiring ever-rising quantities of imported oil - foreign suppliers satisfy two-thirds of the nation's appetite for petroleum. Only a few oil sheikdoms use more oil per capita than the United States, amplifying the effect of price increases on individuals.

The approaching peak of world oil production, combined with the United States' sensitivity to price and supply shocks, points to the inadequacy of a market-based energy policy. Once an oil field is past its peak, increased production can't be obtained at any price. By waiting for the market, through higher prices, to impose limits on consumption, encourage efficiency and promote the development of alternative energy sources, the United States resigns itself to the inevitability of economic pain, places itself at the mercy of foreign suppliers and cedes ground to less energy-intensive competitors.

The United States' near-exclusive reliance on the free market to solve the world's energy problems threatens to leave the country unprotected against severe blows to its economy, security and way of life. Americans did not rely on the free market to put astronauts on the moon, or to create a system of universal education. A similarly ambitious effort is needed now to get the nation ready for a future that will require more efficient use of energy and a diversified portfolio of supplies. It's necessary to anticipate the market rather than merely having faith in it, because waiting for the market to do the job means waiting too long.


Monday, August 29, 2005

Peak Oil: Be prepared

Scoop

Press Release: Sustainable Business Network
www.sustainable.org.nz

We are not running out of oil yet – but we are running out of cheap oil. The Peak Oil scenario describes the point where half of any given oil supply has been used. Production rates fall rapidly after the peak –the date of which only becomes apparent after it has passed. Once the peak occurs, extraction becomes increasingly more difficult and expensive. Set against a backdrop of rising demand, this falling production means that prices will skyrocket.

The “science” of oil exploration is notorious for its uncertainty which has resulted in a range of predictions about when global oil production will reach its peak. Some of the more pessimistic scientists say that the peak has been reached already. “We now find one barrel of oil for every four we consume” says the geologist and peak-oil expert Colin Campbell. Even the more optimistic analysts such as those employed by Shell concede that the oil peak might be reached by 2025 or beyond.

But will an oil peak necessarily be bad news? The threat of climate change alone should inspire us to shift towards cleaner energy sources. Such a shift poses risks, but also opportunities for the business community.

The concept of Peak Oil and the implications it has for business is gaining more attention on the business agenda. The Sustainable Business Network is a membership based network that is proactively looking at many issues facing business today, including our reliance on fossil fuels. David Cunliffe, Minister of Communications, and Green Party Co-Leader Janette Fitzsimons were invited to discuss the topic of Peak Oil and its implications for business in New Zealand.

“To plan early is a wise thing to do,” said Cunliffe. He highlighted how sustainable businesses sometimes drive environmental policies, as was the case with CFC’s. Fitzsimons acknowledged the SBN’s role in leading businesses towards sustainability and showing that being environmentally friendly and being profitable are not mutually exclusive.

Cunliffe emphasised the need for transport sustainability, saying that if reelected, cabinet would be considering a paper that will include a range of incentives for low emission vehicles. Janette Fitzsimons proposed a “feebate” on newly registered cars, whereby people with the cleanest cars could save up to $200 a year. With regard to electricity, the Green Party Co-Leader stressed the importance to shift towards renewable energy sources rather than coal power stations. After all, climate change is an even bigger threat than the end of cheap oil. “We can live without oil, but we can’t live without climate” said Fitzsimons.

The Sustainable Business Network promotes sustainable practice in New Zealand and support businesses on the path to becoming sustainable. We link businesses and provide a forum for the exchange of ideas and experiences equipping our members for success. Further information on the SBN can be found on www.sustainable.org.nz


Peak Oil: The High Water Mark of the Culture of Consumption

Guerrilla News Network

By David Chege - Linus Bell

Humanity is on a collision course with the resource limitations of the planet we live on. Where we are headed and why is the most necessary truth to be told.

The global oil market is making headlines with an increasing frequency these days, as rising gas costs dig into people’s pockets and the price of a barrel of oil continues its upward trajectory. While the administration talks of decreased reliance on foreign oil, the reality is that America has not been energy independent since the 70s oil crisis when it’s domestic oil industry hit a maximum level of production. When Saudi Arabia announces that its supergiant Ghawar oil field is declining in output every year [1], it is stating that it is beginning to undergo the same crisis of production that shocked the US economy three decades ago. Saudi oil is the keystone of world production, and Ghawar supplies nearly half of Saudi output. Everyone knows that the Middle East has lots of oil, but if we can’t pump it out of the ground as fast as we use it, we are in for a tumultuous decade.

It’s basic supply and demand. Demand has risen steadily while annual production has remained relatively flat since 2000. That means more people are making do with less oil, and because prices continue to rise they are also paying more for the privilege. Is there a limit to the surge in oil prices? Analysts at Goldman Sachs predict that the oil value rollercoaster will spike to upwards of $100 per barrel within two years [2]. At those prices you can expect to pay closer to $7 per gallon in the US for gas rather than the $2.00 or $2.50 we hear so may groans about today. Think it’s impossible? Crude oil prices have more than tripled in the previous few years from $20 to now $60 per barrel. Professional expectation that it will double again in the near term are based on many factors including the inability of major oil companies to replace the reserves that they bring to the market with new discoveries, as stated in a report by the Wall Street ratings agency, Standards & Poor [3]. S&P is willing to dismiss it as a lack of investment, but with profits and demand at an all-time high, why would oil companies be unwilling to invest in increase production?

Economists and financiers only study oil in terms of price and market dynamics, but oil is much more than that. Oil is energy. Energy is the physical foundation of our modern industrial economy. Increased energy consumption from increasingly efficient grades of fuel has propelled our economic development since the advent of the industrial revolution [4]. Oil is the cornerstone of that energy supply. It is unrivaled in its combination of extractability, transportability, and energy density. It is the prerequisite for every other form of energy in our economy. The “flat Earth” mentality of free-market economics tells us that we will always find more oil, that market demand creates supply. Physics and geology say otherwise, and the sciences suggest that the world is in for a rude awakening. Oil is finite. You have to find an oil well before you can drill it and the biggest and best were found a long time ago [5].

Hubbert’s Peak:
As a geophysicist employed by the Royal Dutch Shell Corporation to map oil fields, M. King Hubbert spent a career learning and exploiting the processes of the Earth’s formation that create and store its most precious resource. In a landmark 1949 paper [6], he defined the basic trends in the acquisition of any finite resource based upon on a lifetime’s experience with the subject. His subsequent forecasts of oil production were premised upon the hypothesis that the rate of discovery will follow a curve as the process begins at zero, increases to a maximum, then declines back to zero as the last deposits are found, and that after a delay to develop the necessary infrastructure, the rate of that resource’s extraction will follow a similar curve.

1930 was the year in which oil discovery in the continental US hit its peak; since then the industry has been finding fewer and fewer oil fields to replenish what it has been bringing to the market. Having graphed the history of oil discovery, Hubbert compared it to a graph of subsequent oil development and predicted the peak in oil extraction would follow in the early 1970s [7].

He was laughed at.

He was dismissed as a lunatic, raving about doomsday scenarios that could never happen.

He was 100% accurate.

In short, everything that people associate with the 70s economic recession: lines at the gas station, decreasing industrial output, and massive inflation in the financial sectors; was due to conditions predicted and ignored 20 years in advance based upon purely physical analysis, completely devoid of economic or political considerations.

OPEC’s decision to launch an oil embargo was only effective because the US could not increase its own domestic production past the limit stipulated by “Hubbert’s Peak”. This set off a flurry of technological investment and innovation to ramp up production outside the Middle East with North Sea, Mexican and other off-shore, previously unfeasible projects coming online. US domestic production has remained in decline. The North Sea bonanza experienced its discovery peak in the 1980s and its production peak occurred in 1999 [8]. It was the largest exporter of the western world and has gone into decline along with the rest of it.

The Global Hubbert’s Peak
The Earth has been thoroughly explored by seismic observation and geophysical analysis and what little remains is currently being scoured clean. Global oil discovery reached its peak in the 1960s, declining every year since even as consumption has maintained an overall upward trajectory. We currently use 26 billion barrels per year while we discover only 6 billion to replace that [9]. The gap is growing. We are not finding enough oil for discovery to keep pace with production. Annual global oil production will soon reach its maximum potential when about half of the world’s petroleum reserves have been exhausted.

As per analyses by career petroleum geologist Hubbert, and subsequently refined techniques by Jean Laheurre [10] and Colin Campbell [11], oil production could peak as early as 2008 and decline to half that level by 2040. Their totals are consistent with most of the estimations ever made of ultimately extractible oil for the entire planet – give or take a few hundred billion barrels. Allowing for even an extra trillion barrels of oil reserves that we have somehow failed to notice, a second Middle East hiding under our noses, only delays the inevitable peak by a single decade. The numbers are in, and when we reach midway it’s strictly downhill from there: for our energy consumption, for our economy and for our way of life.

The end of our oil-based economy will be the single most critical event in the long history of human civilization, and each of us will live to see it and be responsible for dealing with it. Human development has been propelled by revolutions in technology powered by revolutions in energy acquisition: the agricultural (solar energy) revolution of a few millennia ago, the industrial (coal/oil) revolution of a few centuries ago, and the recent electrical revolution. Failure to adequately prepare for the lack of oil will send us reeling back to a pre-industrial economy.

The International Energy Administration
The IEA, founded to be the early warning detector in the event of a second 70s style crisis, has reversed its former, infinite growth forecasts, in part due to the efforts of the previously mentioned Campbell and Laheurre. Using the most conservative information, accepting for instance, the sudden simultaneous doubling of the stated reserves of every OPEC nation in the 1980s, it has arrived at a global production peak between 2010 and 2020, although given the highly conservative nature of the organization, its findings are couched in the most neutral of terms. It states that assuming current supply/demand trends hold, by 2020 there will be a 16% production deficit to meet projected needs that will have to be filled by “unidentified, unconventional” sources – in other words, pulled out of thin air [12]. Politics aside, the gist of the report is as obvious as it is alarming. Demand is rising – exponentially. Supply is diminishing. This process will accelerate until production cannot support consumption.

After the Peak, Comes the Decline
“Peak Oil” was undoubtedly the major issue discussed by Vice-President Cheney’s Energy Task Force, whose deliberations with the oil industry were so closely guarded. Coupled with the administration’s determination from the outset to effect regime change in Iraq, it is apparent that American energy policy and military policy have become one and the same [13]. The current thrust of American geopolitical strategy is to dominate the world’s remaining oil reserves through a direct military presence in the Middle East.

As oil demand surges in the developing nations, only a handful of countries in the Middle East have the spare production capacity to accommodate them. Control of those resources allows Washington to counter the drive towards modernization in potential rivals like India and China, choking their economies simply by limiting their consumption of oil. In the longer term, as the global reserves that America relies upon become increasingly depleted, access to Middle East oil will allow the US to maintain its culture of unrestrained consumption in the face of worldwide scarcity. Make no mistake, all scenarios of oil depletion that do not include a transition to an alternative energy source end with economic stagnation and collapse following the production peak for all industrialized nations. Possession of the Middle East will postpone the day of reckoning for the United States, but all reserves are finite and the Middle East is no exception.

Obstacles to Transition
US economic hegemony is founded on the use of the dollar as the only currency accepted for international oil transactions. This requires each nation to maintain large dollar reserves in its central bank, permitting the US to print limitless quantities of paper money to finance its enormous trade and budget deficits, confident that the global demand for the dollar will prevent the natural inflation. Any disruption of this system, such as a shift to the euro among the world’s oil producers, would entail a plummeting demand for it and overnight inflation would knock the bottom out of the dollar. Similarly, a change in energy source instead of currency would destroy the ability of the US to float the value of the dollar on top of global demand for the currency required in exchange for the world’s most vital resource. The United States has a stake in keeping the world a slave to dollar-denominated oil dependency to prevent the destabilization of its economy.

The basic mechanism of industrial capitalism is growth. Wealth in America is created as the Federal Reserve Corp. pumps money into the economy by issuing loans to individual banks that then issue secondary or tertiary loans to businesses and individuals. Central banks in other industrialized countries perform identical tasks. This is the fundamental transaction from which “capitalism” takes its names: the temporary loaning of capital to the economy that is then returned with interest to the banker. Because of that interest due, the economy is obligated to grow to repay the Federal Reserve Corp. and the private interests it represents. The economic plateau that peak oil signifies means that the economy will no longer be able to grow out of the debt it incurs to keep it functioning. A limit to oil based economic growth resulting from the global Hubbert Peak is the end of capitalism as we know it.

Energy Crisis
The energy crisis precipitated by oil depletion has three characteristics:

Electrical Energy: for modern industry, commerce and lifestyle
Currently only a small part of US and global electricity supply is generated by burning oil. Coal, followed by natural gas, is the largest contributor to electricity supply with substantial portions also generated by nuclear, & hydroelectric [14]. Oil is rightly seen as too valuable to be used in this manner. However, what often goes unseen is the role oil plays in delivering the coal from the mine to the power plant, and any shortfall in oil supply will still greatly impact coal-generated electricity. Furthermore, the carbon emissions of burning coal and gas are an additional complication to the energy crisis as environmental degradation poses an equally pressing threat to global stability.

Kinetic Energy: for industrial & logistical applications
The transportation grid required by modern commerce is wholly dependant upon oil [15]. Without it, it is impossible to move goods from manufacturer to end-user. Suburban lifestyle in particular is dependant upon personal automobiles and the trucking industry for viability. There is currently no replacement for the gasoline powered internal combustion engine, and the progress from oil peak to decline will be potentially devastating for this type of community structure. Without a replacement fuel, your average car engine descends into obsolescence with the availability of oil. The sprawling residential districts that typify the American way of life require the US to consume a quarter of the world’s oil production, their continued existence depends upon it.

Chemical Energy: for plastics, agricultural and other synthetic products
Petroleum is the base material for many synthetic products. Everything from asphalt to chapstick is derived from the hydrocarbon polymers obtained by processing oil. Also, the pesticides and fertilizers that triple America’s agricultural output are manufactured from petroleum, without which grain yields would plummet [16]. Such intensive farming also causes massive soil erosion that is compensated for by petroleum products, so declining oil availability literally means declining food availability. Declining food availability risks famine and starvation for much of the world’s growing population.

In Conclusion
In their totality, these difficulties will require a complete overhaul of our global economy from oil/coal/gas consuming technologies to renewable electricity/hydrogen technologies. However, a merely theoretical knowledge of new technologies is not enough if the infrastructure is not in place to deliver it to the public. The transition will take time but must be made before the inevitable economic contraction caused by declining oil production renders it impossible.

This metamorphosis to an ecologically sustainable economy requires nothing short of a revolution in the way we think about energy, industry, and personal consumption. Yet this energy revolution is only a part of a greater paradigm shift that encompasses addressing the challenges of climate change and the outbreak of global resource wars. They are all intertwined in the evolutionary crisis of humanity’s ascendance as the dominant species on this planet. We are burning fossil fuels that took hundreds of millions of years to accrue, and effecting planetary changes which will last hundreds more. How we navigate this precipitous junction of human history will be the decisive factor in what kind of world will endure for future generations. The vise is tightening. Today is not too soon. Tomorrow may be too late.

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Sunday, August 28, 2005

James Howard Kunstler interview with Robert Birnbaum

Global Public Media

James Howard Kunstler interview with Robert Birnbaum

In Brief: A simple statement but a nightmarish one: we can no longer expect to have more energy, only remorselessly less energy. An intense chat with author James Howard Kunstler about the chaos that will rattle our society once the energy disaster takes hold.

James Howard Kunstler was born in New York, moved to the Long Island suburbs in 1954, and in 1957 returned to the city, where he spent most of his childhood. He graduated from the State University of New York in Brockport and worked as a reporter and feature writer for a number of newspapers before becoming a staff writer and editor for Rolling Stone. In 1975, he left that job to write books on full time. He has written four nonfiction books (The City in Mind: Notes on the Urban Condition; Home from Nowhere; The Geography of Nowhere; and The Long Emergency: Surviving the Converging Catastrophes of the Twenty-First Century) and nine novels, most recently Maggie Darling. His articles have appeared in the Atlantic Monthly, the New York Times Magazine, and Rolling Stone. He has lectured at number of universities and appeared before many professional organizations. He is happy to point out that he has no formal training in architecture or the related design fields. He lives in Saratoga Springs, N.Y.

The Long Emergency’s subtitle is accurately descriptive of the tome’s subjects, not the least of which is the notion that we have passed the peak of global oil production and reserves and what that augers for our not too distant future. Interestingly, an Aug. 22 New York Times Magazine article by Peter Maass confirms some of the failures Kunstler alludes to in our conversation below. He also comments at his web site:

Maass’s article is full of howling omissions and delusions. For one thing, Maass omits any serious reflection of the consequences of a global energy crisis, any specters of geopolitical blowback, or potential problems for America’s non-negotiable easy-motoring way of life. That omission grows out of the delusional assumption that some magical market mechanism will conjure up a menu of just-in-time replacements for the vanishing oil. These are referred to as “alternative technologies,” a term that points to a more fundamental delusion now rampant among the public, namely the mistaken belief that technology and energy are the same thing, that they are interchangeable, that you can substitute one for the other. Out of oil? Get new technology.

Note to public: technology and energy are not the same things, and continuing to think that they are may place our civilization in jeopardy.

The bottom line of the Times Magazine article is that they are still not convinced that global peak oil is for real, or that we necessarily ought to be worried about it, with all that “alternative technology” banging around out there in the innovational ethers of the magical market. They bring a magisterial cluelessness to the issue—while the back pages of the magazine are devoted to hawking the glitziest high-end products of the suburban housing bubble.

Even more troublesome to me is the fact that no major newspapers have deigned to review James Kunstler’s book. Since he is no crank and the book is not rife with crackpot theories that it has not been introduced into the public conversation is, by my thinking, a serious disservice. I contacted a number of book review editors to inquire why this book has not been reviewed. None chose to respond. Go figure.

Robert Birnbaum: No relation to William Kunstler?

James Howard Kunstler: No relation. Whatsoever.

RB: You’re sure?

JHK: As far as I know, and I think that’s pretty good.

RB: I find something almost as interesting as the reaction to your prognosis in The Long Emergency, your view of what the 21st century portends, your assessment of what is going to happen and is happening. Tabling that for the moment, what is it in your biography that has led you to concern yourself with issues of planning and whatever you call a concern with the future?

JHK: It may be easy for people to misunderstand where I am coming from. I am certainly not a science writer per se. I’m a—really I consider myself a prose artist who went into journalism and then became a novel writer and then returned to journalism. My first eight books were novels, and then I re-embarked on a journalism career. And I wrote several books about the fiasco of suburbia, and where that came from was my experience as young newspaper reporter in the ‘70s and I covered the OPEC oil embargo of 1973—right on the ground, and I watched the people fight on the gas lines while I was waiting on the lines. The whole spectacle made an impression on me, that this was a serious problem and probably a dress rehearsal for a much bigger problem later on. Although at the time I knew nothing about the scientific modeling that has come to be known by the name of its originator, Hubbert’s Peak. It was also obvious to me at the time that suburbia was a tremendous problem—an economic problem, an ecological problem, and a spiritual problem. And that it was connected, obviously, to the energy issue.

RB: Not the culmination or fulfillment of the American dream? [chuckles]

JHK: Suburbia represents a set of tragic choices that we made collectively.

RB: It didn’t just happen?

JHK: Right. Well, I would put it a little differently. Societies tend to be self-organizing. It’s correct to say that the behavior is emergent in the current sense that we understand that term. It’s not necessarily a linear and extrapolative process. Things happen that surprise us. You make a set of decisions and all of a sudden your life works out that way, and the whole nation is all of a sudden suburbanized.

RB: Unforeseen consequences.

JHK: Exactly. Along with something else that is very important, the diminishing returns of technology. And my ass has been whipped by the diminishing returns of technology for the last six days. One thing after another has happened to me. First of all I signed up for the red-eye flight out of L.A. back to the East Coast for Sunday night. Of course when I got to the Los Angeles airport, otherwise known as LAX, I became engaged in a Chinese fire drill that went on for the next 12 hours. Delayed flights, being lied to by the United Airlines employees, when you could find them, because they were hardly there. Missed connections and a whole series of things culminating yesterday when I pulled up to the hotel in Boston. The Lenox Hotel. And the parking valet didn’t seem to understand what I was saying. A non-English speaking parking valet—great idea, right? So I get out of the car and I say, “I am guest in the hotel.”

RB: [laughs]

Small towns in the last 30 years are not what they were. Most of them have become derelict, decrepit shells of places.JHK: “And here are my keys.” He says [imitating an indeterminate foreign accent] “Are you staying overnight?” I said, “This is a hotel and I am guest here and the clear implication is that I will be staying overnight here. Most people don’t check in for the day unless it’s a certain kind of hotel. And I don’t think it’s that kind of hotel.” He didn’t get it.

RB: Why was it necessary to ask you anything?

JHK: Because I was driving a really crummy car.

RB: Oh. Your Toyota truck?

JHK: With 100,000 miles on it. I am not trying to brag about it; I have made it a point not to get sucked into car acquisition for a number of reasons. So he saw me pull up in this decrepit pick up truck to a relatively fancy Boston hotel and he must have drawn the conclusion that I was the equivalent of a motoring wino.

RB: Uh, we were talking about your biography—how you had covered this stuff on the ground and the oil crisis of ‘73 led to your—were they revelations about suburbia?

JHK: It was self-evident once the OPEC oil embargo started that suburbia was a fiasco.

RB: Did you grow up in the suburbs?

JHK: I spent three years of my life in the Long Island suburbs, on the North Shore, in Roslyn between 1954 and 1957. My parents split up in 1957—yeah, we had a Chevy Bel Air and the brand new suburban house and everything in one of the first subdivisions in the North Shore. We moved there in 1954 and my parents split up in 1957, and I moved back to Manhattan with my mom and my dad remained on Long Island in the same housing subdivision with another lady. And I would visit him roughly once a month for the next eight years, until I left for college. So I essentially grew up in Manhattan on the East Side. I went to that grammar school that’s a block a way from the Metropolitan Museum of Art and consorted with the mummies and the armor, and I kept on returning to Long Island periodically.

RB: You never longed to return?

JHK: No, what I wanted to do, especially as I became a teenager, was really move to a small town and date girls who had vowels in their names and go bass fishing and ride motorcycles. But all I really had to do was go to the museums. I had a very solitary childhood because I went to a so-called special New York public school called the High School of Music and Art, and the kids who went to that school lived so far away that they might as well have been in Czechoslovakia. I never saw them after school. So I was a very solitary teenager.

RB: So you had a longing for community?

JHK: Well, I don’t know. Yeah. I didn’t long for it quite that way. I would make a distinction between community and civic amenity. I had plenty of civic amenity in New York City. I had access to all the great public institutions. And when I was a kid most of the museums were free. And the ones that charged, charged very little. It cost a buck and half to get into the Modern.

RB: It’s unusual for a young person to want to live in a small town. Small-town kids can’t wait to get away.

JHK: Yeah, maybe. Of course small towns in the last 30 years are not what they were. Most of them have become derelict, decrepit shells of places.

RB: I live in pleasant small New Hampshire town [Exeter, N.H.].

JHK: Towns that have colleges or prep schools do well because they do supply a certain amount of cultural amenity to a place that otherwise would be devoid of it.

RB: One thing that reoccurs in The Long Emergency is your specific use of the word “project.” When discussing civilization, you talk of it as a project. It seems to me to be an odd choice.

JHK: I think of it in the sense that a lot of what we bring to that “project” is purposeful.

RB: As humans develop in their lives and mature, do they think about the larger palette called civilization as they go about their business?

JHK: Some do and some don’t. Obviously I believe that the universe is hierarchical. I am not an egalitarian leveler. I think that societies are also hierarchical, and obviously some people think more about stuff including cultural issues and social issues and political issues than other people do. Which brings us to an interesting point, which is—what is so disappointing right now is the quality of the thinking that we are getting from the people whose role it is in society to do the thinking. Namely people like the New York Times, our political leaders, our business leaders. The quality of thinking we are getting about where we are at is remarkably poor.

RB: You are defining a specific problem in The Long Emergency. We are on the down side of Hubbert’s oil peak.

JHK: It’s about the global oil predicament. And that predicament is that we are reaching the worldwide oil production peak, top, highest level of production ever and after that we are going to go down a slippery slope of remorseless—

RB: A steep decline?

JHK: We don’t know how steep it’s going to be. The estimate is about three to five percent a year. But it will be a remorseless slope of depletion. And that three to five percent will add up very quickly and we saw in the U.S. what happened [in the 1970s].

RB: Three percent would mean that in about 30 years it’s all gone. [If the estimate is that oil production will decline by three percent of its initial level every year, then yes, in 33 years, it will be at or near zero. But oil production is generally spoken of in relation to the previous year, so it’s likely that the estimate is for a decline each year of 3 percent from the previous year; in that case, production will never decline to zero. After 30 years, it will be at approximately 40 percent of its initial value.—eds.]

JHK: Yeah, and people generally misunderstand what the implications are. A lot of people think it’s about running out of oil. It isn’t particularly about running out of oil. It’s about living in an industrial society that can no longer expect to have more energy but only remorselessly less energy.

RB: You talk about fuel as a platform.

JHK: I made that reference in a different context in the book. That was in the discussion of alternative energy. There is a lot of delusional thinking about how we are going to get out of this pickle. In fact, I like to think of it this way. There are two gigantic mental obstructions that’s preventing us from thinking coherently about where we are. One of them I call the Jiminy Cricket syndrome—the idea that when you wish upon a star, your dreams come true. There is a lot of wishful thinking in this culture. The other one is the Las Vegas-i-zation of the American mind, which is based on the idea that it is possible to get something for nothing. You combine those two ideas and you get a lot of delusional thinking.

RB: I wouldn’t call that thinking at all. These notions might be, if they obtain, subsumed values. If you asked people, they might affirm those things as their beliefs.

JHK: Yes, but you could also say it translates into forms of behavior, including doing things that bring extremely short-term benefits and a lot of long-term destruction.

RB: Yes, what I am searching for here—I was telling a friend about The Long Emergency and his response was that at our age we wouldn’t have to worry about it, and then he noted, “But you have a kid.” And so that adds a level greater than self-interest. So, there is a need to understand the emotional content of the response—not simply the analysis of the objective conditions. You state there is all this cognitive dissonance and you want to connect it to the Jiminy Cricket and Las Vegas-i-zation and on top of that you want to say that you have an upbeat view of—

JHK: I said I am a cheerful person. And I generally am.

RB: Hard to be cheerful after reading your book.

JHK: Well, I’m sorry. I’ve lived with these ideas for years and years and years. I found a way of, to use your word, subsuming them into my psychological makeup. I’ve lived 56 years—I have outlived Babe Ruth and Mozart already. I’m very grateful to have lived this long. So what ever comes now is gravy.

RB: And Bertrand Russell lived into his ‘90s.

JHK: He was a very fortunate fellow.

RB: Why pick two people whose longevity falls below the average? [laughs]

JHK: Only to make the point that I am grateful to be here at all. It’s like what Keith Richards said when he came back from intermission on the HBO concert, “It’s good to be here. It’s good to be anywhere.”

RB: Sure.

JHK: I would make the distinction between my analysis of what the American public thinks and what is really happening, dude. Because they are not exactly the same things, you know.

RB: Trying to digest your take, it gets back to whether your biography shaped a point of view that is dystopian or dyspeptic?

JHK: Let me put it this way, Robert. [with emphasis] A lot of people—I go around and I give university lectures. People are in various states of shock, disappointment, chagrin, resentment, disbelief. And some of them rise up in indignation from their seats and say, “You’re so apocalyptic.” And I have to make the point that what I am describing is not apocalypse. What I am describing is a discontinuity. It’s a major discontinuity in social life and economic life and in civilization generally. But it’s not necessarily the end of the world.

RB: It’s troublesome. Asian pirates marauding in the Pacific Northwest and Las Vegas crumbling into the desert.

JHK: I didn’t say that. I said, “drying up and blowing away.”

RB: Right.

JHK: Which is different. In fact, I wrote a chapter about Las Vegas in my previous nonfiction book, The City in Mind, in which I said the excitement in Vegas will be over for everyone but the tarantulas and the gila monsters. But where were we?

RB: Your apocalyptic vision. We are trying to understand how to process your description of this major discontinuity that people view with various degrees of acceptance and incredulity. Again, I was talking about your book, and someone claimed that their boyfriend converts vegetable oil to fuel for their car. I said, “Didn’t it take some energy to get the vegetable oil to its current state?”

JHK: Let’s talk about this [alternative fuels] for a moment. I tell people that no combination of alternative fuels will allow us to continue running the interstate highways and Disney World and Wal-Mart—even a substantial fraction of what we are running in America—the way we are running it. And we will use them but probably at a much smaller scale than most people anticipate. I had a run-in with bio-diesel enthusiasts in Middlebury [Vt.], and they were incensed that I wasn’t as enthusiastic as they were about it. A lot of them were young. I tried to explore their thinking. And I asked, “Has it occurred to you that as our industrial methods of agriculture fade and fail that probably we’ll have to devote more crop land to the production of human food because our crop yields will go down when we stop pouring fertilizers and pesticides and natural gas-based products and oil-based fuels and so forth on the soil? And so we will have to devote more land for growing food for humans?” And it was, “Oh, dude, we, like, didn’t plan on that.”

RB: [laughs]

JHK: And had they considered that we were going to have to use more working animals in the future and we don’t know how many and what percentage—maybe only three percent more, maybe 32 percent more, than we do now? We don’t really know. But whatever it is, they are going to require a lot of acreage devoted to their feed as well. And they said, “Oh, dude, we didn’t figure on that.” So what’s happening is there is a lot of wishful thinking out there. People realize that the oil used for cooking french fries is being thrown out and you can theoretically and, in fact, as a practical matter, you can use it in an internal combustion engine. Can you convert the entire American car and truck fleet to used french fry oil? Or even bio-diesel made from crop plants? The answer is no. As the engineers say, “This stuff doesn’t scale.”

RB: I found your account of your talk at Google headquarters amusing.

JHK: They have a regular and lively lecture series. And they snatch anyone who is coming through town.

RB: You described them as [or my sense of your account is that they were] a bunch of kids who had cashed in on a big opportunity and had utter faith in technology as transformative in the real world.

There are two gigantic mental obstructions that’s preventing us from thinking coherently about where we are. One of them I call the Jiminy Cricket syndrome—the idea that when you wish upon a star, your dreams come true. There is a lot of wishful thinking in this culture. The other one is the Las Vegas-i-zation of the American mind, which is based on the idea that it is possible to get something for nothing. You combine those two ideas and you get a lot of delusional thinking.JHK: My point there is that another one of the delusions we are suffering from is the idea that technology is the same as energy. And that technology can replace the energy that we are losing. And it’s dismaying to see that people who are working in the technology sector, as it’s called, believe that technology can replace energy. It’s simply a fallacy. It happens that a lot of these people are young people, in their 20s and 30s. I don’t know if they are naive or what the score is. I rather imagine that there is a certain level of techno-intoxication that you find in Silicon Valley from people who have been very successful moving pixels around on screens. They have developed a kind of grandiosity about what they do, thinking it can solve every problem in the world. In fact, what they have given us is tremendous diminishing returns. My life is now tyrannized by email. You know, the computer did not create more hours in the day. Every company and institution in America has a computerized phone answering machine and after 20 years of that the consequence is that you can’t call anybody in America and get hold of them. So, has it improved communications? It’s made it infinitely worse. In fact, this happened to me yesterday when I came to town: I got into my hotel and as a courtesy I tried to call the Boston Public Library to tell them I was here for the event and not to worry that I would get there. I would meet them.

RB: The hotel is across the street from the library.

JHK: Yes, but I was coming from 200 miles away. I think it’s a courtesy to let people know you are safe and sound so they don’t wring their hands at 5:45 waiting, wondering if you are going to show up. To make a long story short, I called the number and got one computerized menu after another. And the original message was. “You’ve reached the Boston Public Library. We are closed now.” It was 3:15 in the afternoon. I knew good and goddamn well they weren’t closed. And when I hit the key to get a live operator, it booted me back into the main menu telling me they were closed. I asked the hotel concierge to get me a number that actually had a live human being on it and I asked her to connect me to the person I needed to speak to and she booted me back to the computer menu. And this happened three more times until I had to scream at her, “I insist that you have a live human being on the line before you hang up.”

RB: The point of these systems was increased productivity, not necessarily your own. The ideal was that we would all become more productive because we could conduct routine things with greater rapidity.

JHK: Yeah, but guess what? All they really succeeded in doing was offloading all the inconvenience from them to you, the public. Instead of them having to be inconvenienced by having to pay $60,000 in wages and medical benefits to a receptionist, all they did was make the public go through a Chinese fire drill every time they pick up the phone. I don’t think I am the only frustrated person in America. And that’s only one example.

RB: What is a Chinese fire drill? This is the second time you have used that phrase.

JHK: A Chinese fire drill is a stunt that fraternity guys used to do—you pull up to a red light in a car, everybody in the car gets out and runs around the car four times and gets back into the car and drives away. It’s a kind of archetypal purposeless activity. And that’s what America is turning into. I also sometimes like to refer to America as becoming the Bulgaria of the Western Hemisphere.

RB: [laughs] Because?

JHK: We are now so inept at just about everything we do. We can’t run airlines, we can’t run hotels. We can’t answer the phone and connect it to anybody.

RB: You do make a point that people who fear the encroachment of Big Brother also criticize it for its massive inefficiencies.

JHK: My point about that really came from this idea that anything that is operating at the gigantic scale now in our society, government, the large-scale farming model based on the Archer Daniels Midland Cheese Doodle and Pepsi Cola agricultural model, or the Wal-Mart model of commerce or the large centralized high school—any of these gigantic scale things are going to either wither away or fail or not work well under the conditions that we are moving into. Our lives are going to be greatly downscaled and are going to be profoundly local and the larger things in our lives are going to fade away. Including the federal government. My friends back home are all wringing their hands over George Bush becoming the next Adolf Hitler—

RB: Your friends in Saratoga?

JHK: I live in Saratoga Springs, which is a classic Main Street small town.

RB: Where the racetrack is.

JHK: There is a famous old racetrack there that still runs.

RB: And Skidmore College?

JHK: Yes, and it’s got a kind of a mixed economy. There are a couple of other big things there. A large printing plant that puts out regional editions of Newsweek, a bottling company—and anyway, so my friends are all wringing their hands about Bush. I have a couple of thoughts about this—one is that they’ll be lucky if the federal government can answer the phones, based on the way we do that, let alone regulate their lives. I think the political action of the future is going to tend to be more local and regional, and it could get pretty despotic. The federal government isn’t going to be able to handle that.

RB: The rest of the world hasn’t made the same leap to gigantism as the U.S. has, that the scale of life in the rest of the world, even in large countries, isn’t like that of the U.S.?

JHK: Let’s look at the Europeans, since they are most closely related to us culturally. They developed their oil industry around the same time. But their sources were very far away. British Petroleum got their oil from Iran, and Shell got its oil from Indonesia and the Rothschilds developed their oil [holdings] around the Baku region of Central Asia. Their sources of oil were far away. In the U.S. in the 1920s, we had a far different situation. We produced all of our oil right on the spot. We could get it easily and transport it easily and it was cheap and we had a lot of it. And so after the interruption of World War I, you get the 1920s and the whole boom period is really based on the first phase of car-centered suburbia—so you get this tremendous suburban juggernaut under way in the U.S. and it maxes out in 1929. It was the source of the ‘20s boom, building all the new suburban houses. Retrofitting the cities for cars, selling all the cars, selling all the steel, the cement, and all that stuff. Selling all the toasters and furnishings for all the new houses. A tremendous expansion including what has been the consequences of tremendous rate of immigration.

RB: We didn’t create the interstate highway system until much later.

JHK: That’s not what I am talking about. The first phase of automobile suburbanization occurred without the interstate highway system. And then came the interruption of the Great Depression and the Second World War. There are many ways of describing the Depression and one of them was that we had maxed out and saturated our capacity to carry on the suburban expansion. Everybody who could get in on it, did, and it was over. And we couldn’t sell cars to the Chinese, because they were living in the equivalent of the 12th century, and Europe was not going to be suburbanized because—

RB: Let me interrupt you—I thought the Great Depression was a failure of our banking system in addition to a huge agricultural crisis?

Suburbia is no longer country living—it’s a cartoon of country living, and a cartoon of the country, in a cartoon of a country house. And because of that it lends itself to ridicule even on the part of the people who live in it.JHK: I would put it differently. The agricultural crisis was perhaps not what you are thinking of. The dust bowl was a sub-crisis. The main agricultural crisis was really a result of overproduction and crashing prices largely because of the mechanization of the farm and the introduction of the tractor and once you get that you get tremendous overproduction—in the 1920s, when the Europeans recovered from the war, their agricultural markets were lost to us, not completely but the demand from Europe declined in the ‘20s and the American farmers were producing tremendous amounts of grain and they went into a depression in the mid ‘20s that preceded the greater economic depression, which then became a matter of saturated markets and then the failure of not just the banking system but of the expectation that the industrial economy could continue to grow. As Franklin Roosevelt put it, what you saw in the Great Depression was this paradox of “want amidst plenty,” as he put it. We had plenty of oil, mineral resources, manpower, and good farmland despite the dust bowl—the dust bowl did not encompass all the farm lands of the United States. And we had all those things, and yet we had a failure of capital and the ability to raise money and raise investment and keep on producing stuff. Remember we had scaled up our factory systems to such a gigantic degree in a very short period of time, in 20 years—

RB: There is an argument to be made that World War II saved us economically.

JHK: Well, I wouldn’t put it that way. What probably happened is that virtually the rest of the industrialized world either was destroyed, bankrupted, or exhausted by World War II, and by the time it was over we were the only people left standing with our equipment intact.

RB: And what pulled us out of the Great Depression?

JHK: The fact that after the Second World War we could make anything we wanted and sell it to people all over the world and lend them the money to buy it.

RB: We were able to product armaments, which took up the slack in our production output circa ‘38, ‘39—there was another depression in ‘38.

JHK: That’s not what I’ve said. The point I have made in my book is that we had been in a deep industrial depression and the necessity of war production got us to produce things again but we were not producing the same things as before. Instead of cars we were producing tanks and airplanes. Why? Because we had to.

RB: And starting employing people. Giving them incomes, giving them—

JHK: That’s quite true. And also sending millions of men in the prime of their lives into the Army and a lot of them died there. When we came out of the Second World War there was tremendous and pervasive anxiety that we would slip back into the depression and, in fact, to some degree we actually did in the late ‘40s. And we had to create mechanisms to allow us to move on. We realized that the rest of the industrialized world was on the ropes. The victors in Europe in World War II were not that much better off economically than Germany, the big loser. France and England were in bad shape after the war. They had suffered a certain amount of physical destruction but they also had suffered tremendous economic losses that took them decades to overcome. You ask why France and England didn’t suburbanize or begin that process, anyway, for decades after we did? They had to borrow money from us just to keep their societies on life support into the 1960s.

RB: So you don’t think there is a cultural difference of social organization that prevents Europe from opting for the urban suburban model?

JHK: There are many reasons why the Europeans did what they did, and we did what we did because we were able to. We had an historic antipathy to the industrial city and almost of our cities were in one way or another industrial. We had no experience with any other kind of city, and the perceived remedy for that was going to be country living for everybody. That’s what suburbia was all about. Unfortunately—

RB: I am also trying to—

JHK: Robert, you’re getting ahead of yourself here. Let me step back, OK. You ask why Europeans didn’t suburbanize? I began by trying to say that they simply didn’t have access to oil the same way we did. And we did all the suburbanizing in the 1920s—began this tremendous project. They didn’t. They were recovering form the First World War, which was tremendous disruption.

RB: You are arguing it was mostly a matter of wherewithal.

JHK: No, wait a minute. Hold on a second. So the 1930s were a time of exhaustion and recovery for the Europeans, and all of the sudden they find themselves in World War II. After World War II, they are completely exhausted and bankrupt or blown up. And so they are not going to start suburbanizing. It isn’t until the 1970s they even begin the first feeble attempts at that. There are other things at work there. They had different land tenure traditions in Europe. America had more undeveloped land around the cities.

RB: We also had more mobility.

JHK: And that had to do also with the historical development of industrial society in the 20th century. We had, for example, this huge, vast agricultural region in the South where people were living in the equivalent of serfdom in the 20th century. Alabama, Mississippi, South Carolina, Georgia—even the people who weren’t serfs, poor peasants—these were huge states, you could fit 23 copies of Massachusetts into Alabama. They had vast distances between places, and the car came along and it really liberated them from the tyranny of geography. And once the Depression and Second World War are over and we reconsolidate our position in the world, you get this tremendous suburban development of the southern U.S., and that’s where all the action has been over the last 30 years. This tremendous movement of capital and people and jobs to places like Atlanta, Dallas, and Houston, and that has become the embodiment of what late florid suburbanization is about. Although you see it all over the United States, too.

RB: OK, this country doesn’t seem, to me, to have a tradition of social urbanization and organization that obtains in Europe. Perhaps a fugal forward movement, improvisational or emergent—

JHK: Uh huh—

RB: What I am trying to get at is, even if they could have done what was done in the U.S. in the first phase of suburbanization, would they have?

JHK: They had different land ownership principles and traditions.

RB: And perhaps a different sense of civilization and human intercourse.

JHK: A lot of it has to do with this idea that in America suburbia is a response to the horror of the industrial city. And the discomfort of the industrial city. You don’t get it quite the same way in Europe. First of all, there is no medieval Cleveland. There was no Renaissance Baltimore. In Europe, you get these centuries and millennial overlays of civic organization and civic experience. And they did not reject the urban experience the way Americans did. Their cities were not strictly industrial cities. And in fact if you look at a city like Paris, which I have written about in The City in Mind, they went through a great urban convulsion of renovation in the 1850s and ‘60s under Napoleon III—

RB: That’s the crazy Napoleon?

JHK: He was Louis Napoleon, the nephew of the first Napoleon, and he came to power about 1850 though a sort of democratic process. He was essentially elected and made emperor by a country that—let’s not digress into the trivia of the politics of France of 1850—anyway, Louis Napoleon, otherwise known as Napoleon III, undertook this great renovation job in Paris and got the prefect of Paris, George Hausmann, to carry it out, and the result of it was the great City of Light we know today—the core of Paris that is generally considered to be the paragon of urban life and has been for 100 years and continues to be a place that everybody respects and honors and values and understands to be the epitome of what is good in city life. The animating spirit behind that—the idea that city life has value, that city life provides tremendous amenity—is present everywhere in Europe. You find it in London, in Lisbon, in Barcelona; even the German cities that were destroyed got it back. They did not lose the idea that city life has value and the city itself can be a wonderful thing. That’s not the case in America. Most people here disdain everything about the city from its physical form to the behavior you find in it.

RB: Really? New Yorkers seem to be an exception. Also Chicagoans.

JHK: Yes, there are exceptions. And there are places that are valued. Certainly Boston, where we are sitting today, in the Back Bay of Boston, retains that quality of a valued urban life. They’re the exceptions and they are great exceptions. If you go to Kansas City, St. Louis, Louisville, Milwaukee, Cleveland, Pittsburgh, Philadelphia, Baltimore—the list is very long. Even the small ones, Akron, Des Moines, Dayton—you will find an urban America that is completely cored. There is nothing left in these places. The surrender is complete. For the most part what you see in America is city life that is not valued and the idea that country living is going to be an antidote to city life. Now, what happens in America is very unfortunate because after the 1960s suburbia is no longer what it originally advertised itself to be. This is, of course, one of the great agonies of our time. Suburbia is no longer country living—it’s a cartoon of country living, and a cartoon of the country, in a cartoon of a country house. And because of that it lends itself to ridicule even on the part of the people who live in it. One final thing, I’m sorry to be overbearing here—

RB: [laughs]

JHK: Three things happened between America and Europe that were very different. The Europeans did not destroy what was left of their cities in the decades following the Second World War. We destroyed ours. They did not destroy their public transit. We did. We have a railroad system that the Bulgarians would be ashamed of. And the Europeans did not destroy the local agriculture around their towns and cities or the value-added activities associated with it. So I consider them to be in a somewhat better position to confront the disorders and discontinuities ahead of them then we are. People are still going to be able to get to work in Barcelona and Lisbon. People in Atlanta and in Silicon Valley will not be able to get to work. People in Los Angeles will not be able to feed themselves. People in Atlanta may not be able to feed themselves. People living around Paris will get food.

RB: Are there signs? There is a trend of people moving back into cities, of people appreciating boutique farming and produce—none of this is on a grand scale but there is some recognition that there is value here. Might this be the beginning of a movement to take on the consequences of oil depletion?

JHK: The deformities and miseries of suburban life are now so obvious to younger generations that many of them have clearly decided that they need a different way of life. Those are many of the people who are moving back into the condo lofts and some of the rehabilitated neighborhoods of some of the cities. There’s nothing mysterious about it. If I grew up in some miserable suburb in some miserable place like Arlington, Texas, or the asteroid belts of Los Angeles, I wouldn’t want to live in a place like that either. Where agriculture is concerned, you can see very clearly in a place like upstate New York, where I live, what is happening. That indeed a new kind of agriculture is slowly coming around. We see dairy farming collapsing in upstate New York. It’s been in a protracted state of senility for 30 years, and it’s funny, a lot of people think that dairy farming is the only thing that ever happened up there. In fact, that was a kind of industrial activity in and of itself. It came about really only because of [rural] electrification, bulk refrigeration, and the electric milking machine along with Mr. Billings’s development of the Holstein cow. But we had a much more mixed agriculture before 1900, and the people who live in my part of the country are generally not aware of that. We are getting back now a much more mixed agriculture. You have young people buying some of these derelict farms and raising lambs or producing market greens and quite a diverse range of crops. We are going to see a lot more of that. One of the things we are facing in the future is going to be a restoration of the distinction between what is urban and what is rural—between town and country. And that is exactly what was destroyed by suburbia. Which was a mish mash of the whole thing. The animating idea—one of the animating ideas in suburbia is that you can lead an urban life in a rural setting. In the future that will be increasingly impossible. If you decide to live in a rural place, you are probably going to have to follow rural occupations and ways of life. That does call into question what will happen with the urban part. I hold that our larger cities are going to contract, probably painfully. There will probably be a movement back to re-densifying the core at the same time that the asteroid belts of post-war crap lose value and dissolve.

RB: The cores these days are skyscrapers.

JHK: When I say the core I don’t necessarily mean the downtown business districts. Those parts are going to be very, very problematical, and that’s another important point you have made. The places that are overburdened with mega-structures, whether they are skyscrapers or even just large buildings, are going to be in real trouble. These are experimental building types that have only been with us for 100 years. I’m even talking about 10-story pre-war apartment buildings. I don’t know if we can run them in the energy-scarce economy that we are going to have in the future. And it raises one really interesting question like the question of—take this for example—modern plumbing as we know it, where every apartment has a bathroom, a toilet, etc., is totally dependent on central heating, good and dependable central heating. You can’t be running space heaters in a 10-story Manhattan apartment building. If one-third of the building or one-eighth of the building isn’t warm enough to keep the pipes from freezing, the whole building is going to lose its plumbing and then the building is going to become dysfunctional and we don’t know if this is going to happen or not. And it could. Because the natural gas situation in America—which is how we heat most of our buildings now—is arguably more ominous than the oil situation.

RB: Your description of the aspects of what you call the long emergency is compelling when you went to California and addressed a group of urbanism—

JHK: There is a group called the Congress of New Urbanism.

RB: What is new urbanism?

JHK: The new urbanist movement came out of the 1970s, a lot of young architects and planners and urban designers who had been working in response to the oil embargoes of the ‘70s, working on solar housing and stuff like that. They realized that it wasn’t just the houses that were a problem, it was the arrangement and organization of them in the landscape and what we really had to do was get back to creating walkable communities. And so they have been the main organization behind the reform of our suburban development practices. They coalesced into an official formal organization called the Congress for the New Urbanism in 1993, led by figures like Peter Calthorpe, Andres Duany, Douglas Kelbaugh, now the dean of the University of Michigan’s architecture school, and other people formed this organization and I had been active in it—

RB: Because you are a new urbanist?

JHK: I am. I am a card-carrying new urbanist who signed the charter in Charleston and pays his dues every year. It’s going to be terribly important if we are going to have a different kind of social arrangement in America in terms of how we live and where we live—and we are going to have that—it is very important for us to retrieve that lost body of culture and principle and methodology and skill for how to arrange the human habitat on the landscape. We threw all that knowledge in the dumpster in 1960 and decided from that point on we would only use traffic engineering and statistical analysis to produce our everyday environment, and the result is there for everybody to see—miserable suburban strip malls and the power centers and subdivisions and all the crap that we have smeared across the landscape.

RB: Who could argue with that description, but aren’t there glimmers of hope that we haven’t totally thrown it away? At some point in the mid ‘70s I was in Galena, Ill., [birthplace of U.S. Grant], small town, perhaps Nowheresville. But the town fathers figured out that if it was restored to its 19th-century feel, it would be a tourist attraction, and now it’s a pleasant little town and so forth. So the idea of a return to small town lifestyle wasn’t totally lost. And I suspect there are other towns like that around the country.

JHK: There is no question that historic preservation movement has been very important, but the percentage of restored places to the suburban—

RB: I’m responding to your claim that the knowledge has been lost.

JHK: The knowledge for replicating. Let me make these two points. The percentage of restoration has been relatively tiny compared to the creation of horrendous new crap everywhere, and most American towns have been literally destroyed. Only a tiny percentage of them, including the one I live in, have been restored to some extent. Our ability to create new urban fabric of quality and character has been very poor, and even a lot of the new stuff we build doesn’t come up to the ankles of the people who did it in 1911. We are finally getting back a much better sense of urban design, thanks to the new urbanists. Which is to say, the attitude of the building toward the street, the relations of the buildings to each other and the public realm, the ability to create mixed activities rather than monocultures. We have improved in that but in the design of the buildings themselves we are really in trouble. A lot of it has to do with our codes. The handicap codes in America, for instance, essentially mandate that developers can only put up one-story buildings, because the requirement for elevators and ramps and all kinds of things are now so onerous that people confronted with the opportunity to put up a new urban building are very reluctant to do it or have to make heroic expenditures in order to come out half as good as the stuff they are trying to fit in with. So we have a lot of problems. It’s my belief that as we enter this period of disorder and travail and hardship and economic trouble, that among other things we will probably begin to ignore are a lot of the codes and regulations that we cooked up in the late 20th century because we won’t be able to afford to follow them. People are really going to have to improvise their way through this including rebuilding America on something more than a single-story basis and something less than a ten-story basis.

RB: You suggested that political organization would become more despotic, that many of our concerns and amenities will be trashed based on the necessities imposed by what you suggest.

JHK: My reference earlier was to politics. We are liable to see more despotic politics on the local level because there is going to be a desperate need for authority and people may turn to not the nicest characters. We will have to make certain expeditious decisions about things, like whether we prevent someone from building a three-story house without an elevator because can’t afford to do that anymore. And yet our laws stipulate that we have to have elevators in virtually every building. I am not against keeping handicapped people from getting around. I am saying it has been a luxury of this tremendously affluent period of our history, that we have been able to mandate that. Nothing lasts forever and that is one of the things—and that’s not the only issue in how we rebuild some kind of urban America. I happen to believe, by the way, there is going to be a lot more action in the smaller towns and cities than in the big cities. The big cities will contract in scale and probably in population. All of our cities occupy important sites and there are reasons for them to be there, whether they are river towns or harbor towns, and they are not going to go away.


Saturday, August 27, 2005

Finding solace in $3-a-gallon gas

csmonitor.com

High gas prices are a doomsayer's delight. Trips to the mall are fewer, vacations shrink, heating bills rise, inflation rises, the economy slumps. Those harmful effects need to be addressed, but in the long term, such prices can actually serve consumers.

If oil prices manage to stay above $40 a barrel for years, which many experts now say is possible, then the alternatives to oil, from solar cells to liquefied coal, look very attractive to energy investors. (Current oil prices seem stuck above $60, or more than 50 percent higher than a year ago.)

Then the world can start to make the inevitable shift to a new energy era independent of crude.

That transition is coming anyway in this century. It's better to start paying the "replacement cost" now for the eventual depletion of oil reserves and move to a range of alternatives. Many of them are cleaner, renewable, or - get this - not imported from a few terrorist- infested nations.

Since 1973, of course, high oil prices have come and gone like bad romances. But that's the way OPEC prefers it. Not only has this cartel of petroleum giants helped to keep prices way above production costs, it has also occasionally moved to drop oil prices when they were too high.

That trick has left a lingering threat of roller-coaster prices, scaring off multibillion-dollar investments in many alternative energy sources or in expensive conservation steps that require years, even decades, of use in order to justify costs. If potential investors can now have some assurance of making a profit in many oil alternatives within a few years, there could be a rush from crude.

Indeed, OPEC's ability to make prices gyrate - which affects investors much as currency fluctuations do - could be over. Many of its wells are pumping at near capacity. Some experts say the giant Saudi oil fields are nearing a peak of production and could see a decline. On the demand side, China and India show little signs of reversing a rising demand for cars and petroleum.

Despite all that, oil-price predictors remain divided. Last month, the US Energy Information Administration (EIA) forecast prices would decline to $31 a barrel (in 2003 dollars) before reaching $35 per barrel in 2025. But it also warned the latest price rises could push up those numbers.

The EIA doesn't have much hope for renewable energies, predicting they will maintain only an 8 percent share of world energy consumption. That may reflect, however, a stronger interest in producing oil from nontraditional sources such as coal and oil sands - all in abundance in North America.

Coal liquefication, which South Africa perfected from Nazi technology during the embargo against apartheid, is a technique sought by China, which also has big coal deposits. In the US, coal-to-oil production probably needs at least a $30-a-barrel price to break even. Canada's giant oil-soaked sandpits, meanwhile, appear to have become a profit center.

A continuing frontier is the wringing of more efficiency out of oil use. Hybrid gas-electric cars are a good conservation leap, but government still needs to demand higher fuel efficiency from automakers, or to push harder for non-oil vehicles.

It's difficult to cheer for consistently high oil prices; consumers feel the pinch. But cheer we must.


World running out of time for oil alternatives

Daily Times

By Anna Mudeva

The world could run out of time to develop cleaner alternatives to oil and other fossil fuels before depletion drives prices through the roof, a leading Dutch energy researcher said on Thursday.

Tn Hoff, manager of the Energy Research Center of the Netherlands, said it could take decades to make alternatives affordable to the point where they can be used widely, although high oil prices were already stimulating such research.

“If we run out of fossil fuels -- by the time the oil price hits 100 dollars or plus, people will be screaming for alternatives, but whether they will be aailable at that moment of time -- that's my biggest worry," Hoff said.

"That's why we need to use fossil fuels in a more efficient way to have some more time to develop these alternatives up to a level where the robustness is guaranteed and their price has come down ... This could take decades for some technologies." Stubbornly high oil prices have renewed worldwide interest in sustainable energy sources, such as solar, wind and biomass as well as biofuels. But the world currently covers just some two percent of its energy needs with renewables as high costs and mixed policy initiatives hinder a wide-spread usage. "The high oil price makes people at least think about alternatives ... For us it's a definitely a stimulus to work even harder than before," Hoff said.

LOWERING COSTS ECN, one of Europe's leading energy research institutes, is working to improve or develop new technologies to boost efficiency and lower the costs of power production from wind, solar and biomass, he said. ECN researchers are trying to raise the energy conversion efficiency of solar panels to above 20 percent from the current 17 percent, while reducing costs.

"In 10-15 years, I expect that solar energy conversion could be in competition with electricity produced from coal," Hoff said. He believes the Netherlands has the potential to cover a large part of its power needs with solar energy.

ECN is also researching to increase the size of wind power turbines from the 3 megawatt a turbine produces now to 5 or 6 MW. This could be done by raising the height to 100 meters from 70 now and enlarging wings pan to 120 meters from 90, he said.

ECN is also part of the $225 million "Global Climate and Energy Project" led by the U.S. University of Stanford and financed by General Electric, Toyota, Schlumberger and ExxonMobil. The project aims to crack new technologies on fuel cells, which make electricity from hydrogen and emit only water vapor, energy production from biomass and separation and storage of carbon dioxide (CO2). The greenhouse CO2 gas is released when burning fossil fuels and is blamed for global warming.

Under the project, ECN will develop a new type of membrane reactor, which will separate CO2 during the process of producing hydrogen from fossil fuels, Hoff said. The CO2 could later be stored by companies in depleted gas or oil fields. Hoff and other researchers say a transition to the so-called hydrogen economy could take decades as the cost of building new hydrogen-burning cars and power plants and storing CO2 are huge.

The best hydrogen usage in real life, ECN is in talks with the northern Dutch island of Texel to install hydrogen-based facilities, which would supply electricity to homes and offices. "The idea is to see the pitfalls, fix them ... and prepare for the future. My hopes are that this will stimulate the usage of this type of new technology because it is extremely important to have it in real life rather than in laboratories," Hoff said.