More about less

In case you believe that those who are proclaiming the end of oil are a bunch of Chicken Littles, consider the following.

  • Last week Shell Oil announced that it could not find enough new reserves to keep up with the rate at which it was pumping out existing fields. That is, the amount of oil in the ground is declining — at least as far as Shell can exploit it.
  • According to the 30 April 2006 edition of Energy Alert “Even though Exxon is growing production strongly, it has been earning less from the incremental barrel. In other words, production is increasing for Exxon but it’s costing more per barrel to produce, for a number of reasons.
  • Demand for oil by India and China continues to rise, bumping up against the also escalating needs of the U.S.

These are just three of the indicators buried in the news that support the idea that gas prices may fluctuate day to day, largely for political reasons, but the long term and inevitable trend is up.

Fuelishness

At the risk of sounding unpatriotic or worse, I have to say that my reaction to escalating gas prices is: good! We have been underpaying for our energy for decades. The result is that, like all things that are free, or at least cheap, we are profligate spenders thereof. Now that the price of gas has begun to get our attention we may, just may, begin to think about ways to reduce our pain.

Such as by teleworking more, planning car trips more carefully, dumping the gas guzzler for a vehicle that is more fuel efficient, encouraging R&D on alternative fuels and propulsion systems.

But is that what’s happening? Not in Congress. Most of the activity by both parties seems to be directed toward bringing gas prices down again. Continue reading Fuelishness

Teleworker profectiveness

For years I have tried to steer clients away from the use of productivity as a means of measuring the results of what teleworkers do. The reason for this is simply that productivity is a word associated with things, widgets, stove bolts, automobiles coming off the assembly line, and other manufactured objects. The broader, macroeconomic view is that productivity is somehow related to efficiency and value added. If a product sells for more than the costs of capital, materials, labor, and facilities used to produce it, then positive productivity must be at work.

The problem is that it is pretty hard to evaluate that sort of productivity for many types of information work simply because it is hard to identify the product to be measured. Continue reading Teleworker profectiveness

Hitting the peak

Here’s the central problem with peak oil:

  • World oil production will hit its peak around 2011 unless some totally unanticipated discoveries occur between now and then. So far, none of the discoveries recently announced in the press have been unanticipated. Furthermore, new discoveries tend to be in hard-to-reach places, simply because all the easy-to-reach spots have been exploited long ago. Tertiary exploitation of these resources has begun and will eke out more oil, but at a rising cost of recovery.
  • World demand for oil is growing, particularly in Asia. Continue reading Hitting the peak

Some perspective on energy

Robert Semple, Jr., who is the associate editor of the New York Times’ editorial board, has written an excellent review of the world energy situation and its future prospects. This appeared in the Times’ Opinion section under the title The End of Oil. The thesis of the article is that we will ultimately use up the world’s oil reserves and will have to turn to other energy resources in order to keep the transportation economy going. The uncertainty is in how long “ultimately” is. The oil pessimists, and I count myself among them having spent a few decades doing energy calculations, put “ultimately” in the next few decades. Continue reading Some perspective on energy

Telework and broadband

When we first started to formally test telecommuting in 1973 the main objective was to determine whether anyone could successfully telecommute as an employee of a real business organization. My main chain of reasoning, resulting from a conversation with a regional planner somewhere around 1970, was as follows:

  • Urban traffic is getting out of hand, especially during “rush hours”. Why? Because of all those cars on the road, most of which are single occupant vehicles.
  • Why are all those cars on the road? Most of them contain people who are commuting between home and work.

Continue reading Telework and broadband

Oil and the state of the union

On 31 January President Bush exhorted the United States to reduce its imports of Middle East oil by 75% by 2025. He did not mention that Middle East oil accounted for only 11.2% of the US imports in 2025 so that, all other things being equal, he was talking about a 8.4% reduction in US oil imports by 2025.

That level of reduction is likely to occur in any case, simply because we are already at or very near the peak of global oil production and, according to Colin Campbell’s baseline scenario, the world will be producing 21% less oil in 2025 than in 2005 — simply because we’re pumping it faster than we’re discovering it and will soon reach (or already have reached) the peak in production. After the peak, global production will inevitably decrease every year. There are those who argue against Campbell’s forecasts but, so far, he has been right on target.

Furthermore, competition for the world’s oil is increasing as developing countries, particularly China and India, develop. We were in China a few months ago and can attest to the fact that major cities there, such as Beijing and Shanghai, appear to be just as traffic congested as any big city in the US. China is now the world’s second largest consumer of oil and is busily making deals with oil exporting countries to ensure its future supply. All of which does two things:

  1. It increases the pressure for greater production — and faster depletion — of those finite oil resources.
  2. It increases the likelihood that oil will steadily move toward the USD100 a barrel range and that gas at the pump will be above $5.00 per gallon in the US.

Keep in mind that by far the largest use of oil is for transportation and half of automobile transportation in the US is for the daily commute to and from home and work. So, as I have been preaching for more than three decades, a good way to reduce our dependency on oil, of whatever origin, is to use our cars mostly for non-commuting purposes and switch to telecommuting for much of the work-related travel; move our thoughts instead of our armor-encased bodies. Telecommuting uses way less energy than does commuting by single-occupant car. And the source of that energy needn’t be fossil fuels.

But did President Bush mention energy conservation in his State of the Union address? Not a word of it. The focus was on developing alternatives to fossil fuels, particularly bio-fuels. The relative effectiveness of bio-fuels will be the subject of another blog but there is another point that the President missed: the course we’re on now guarantees that global warming will worsen!

A growing number of scientists conclude that we may soon (as in less than a decade) reach the point where global warming may trigger climate changes that will not be reversible for a few hundred, if not thousands, of years. The increase in global warming has been produced by human activity that results in the production of large amounts of carbon dioxide from burning fossil fuels. There is very little scientific disagreement on that even though there is still uncertainty about the rates of change.

So, if we are to slow, and hopefully stop, the global warming trend we need to do what? Slow down the production of carbon dioxide!

Shifting our transportation fuels from oil to some other carbon-rich substitute like ethanol or peanut oil from Chinese restaurants won’t do the job. We need to change to fuel substitutes, like hydrogen, that don’t produce carbon dioxide. We need to produce more energy efficient vehicles, Detroit resistance and Congressional wimpiness notwithstanding. We need to change our transportation habits. And we’re way late in doing so. The President didn’t mention most of those options.

The alternative, as always, is to do nothing and hope the problem will go away. We’re really good at that. Except that the problem won’t go away. Instead it will only grow worse. The State of the Union address misses most of that and does very little to help the total solution.