Economists tell us market forces (with checks and balances to prevent extremes like banking crises, etc.) produce the most efficient way to allocate resources.
“Peak Oil” is often played by renewable energy campaigners as a trump card in the debate over whether we should reduce fossil fuel burning and by how much (“even if carbon dioxide doesn’t cause global warming, you’re going to run out of oil so you’ll have to stop burning it, or our grandchildren will perish, anyway!”).
It’s intuitively obvious that exploiting a finite resource to exhaustion with rising population and wealth will lead to a production peak followed by a decline and rising prices, so when people scoff at “Peak Oil”, it isn’t the principle they dismiss, rather, the simplistic, doom-laden, outcomes campaigners infer from it and spin for their causes.
We really don’t know how difficult “Peak Oil” will be or when it will occur since there’s plenty of oil, the issue is cost and we can only guess where technology will take us in the next 50, never mind 500 years. Too often, we imagine technology will stand still; for example, just as coal replaced wood during the Industrial Revolution, oil demand may be replaced by, say, gas or nuclear energy; on the other hand, we will discover how to produce oil more cheaply and use it more efficiently.
Gas can replace oil for heating, transport, power generation and manufacturing plastics, etc, and in the US, where “unconventional” (shale) gas production is already well developed, gas prices have tumbled and their hitherto moribund chemical industry is booming.
“Conventional (gas) recoverable resources are equivalent to more than 120 years of current global consumption, while total recoverable reserves could sustain today’s production for over 250 years.” (International Energy Agency Special Report, “Are we entering a golden age of gas?”)
This excludes the potential for extracting gas from methane hydrates, frozen deposits on the seabed and under polar ice. Japanese engineers are already developing technology in the Sea of Japan and in a joint venture with Canada in the Arctic. They have 250 years in which to succeed and when they do world reserves will dwarf all other fossil fuel resources. The expected timescale, however, is 30 years following which supplies will be available for well over 500 years.
Apart from that there’s booming shale oil technology and vast reserves of tar sands, developing genomics, nano-technology and synthetic biology will combine to produce oil biologically and of course, new nuclear technology in the form of fusion power and thorium reactors is in view – and of course, Old King Coal still reigns supreme!
Thorium nuclear reactors produce virtually no long term toxic waste, they can re-use conventional nuclear waste and there’s thousands of years’ supply of fuel. Despite the US having an operational prototype in the 1960s the technology was shelved, presumably, because it’s useless for making bombs.
So should we really stop using fossil fuels to “save our great-grandchildren” in 500 years’ time, it would be like Henry VIII commanding his subjects not to burn wood to save us now?
We’ve emerged unscathed from “Peak Widd” and similar Dark Ages excesses. We disregard economics at our peril and fighting market forces is digging us ever deeper into fuel poverty via green taxes and heavily subsidised renewables.
Humans have progressed from wood-burning to coal, to oil and now to gas and hydro, dramatically reducing carbon dioxide emissions along the way.
“Neither Queen Victoria nor Abraham Lincoln decreed a policy of decarbonisation. Yet, the energy system pursued it. Human societies pursued decarbonisation for 170+ years before anyone noticed.” (Jesse Ausubel, International Journal of Nuclear Governance, Economy and Ecology, 200764.)
The US is reviled as the only advanced nation not to sign up to the Kyoto Protocol yet it is the only region of the world to reduce energy consumption (per capita) between 1990 and 2008 (Wikipedia, from IEA/OECD/World Bank).
Sounds like market forces have been doing the better job!