Telework and Energy
"It's time", the guru said, "to talk of many things.
Of oil reserves, and SUVs and why we can't grow wings."
--Apologies to Lewis Carroll
First, the Bottom Line:
It is very doubtful that world oil production can increase much beyond
present values. Yet oil demand continues to grow. Unless something changes,
soon there will be a crash.
The facts.
- There was only so much oil in
the earth to begin with. Although experts differ as to the
details, new oil is either not being generated underground or, if it
is, the rate of generation is far slower than the rate at which we are
extracting it.
- We have already pumped about
half of the global supply of oil out of the ground. Here, too,
experts differ as to the details but the consensus is that we are now,
in 2005, at about or past the halfway point in oil extraction, give
or take a year or two. Worse, we have pumped most of the "easy
oil". In the future we must rely on smaller pools of oil in places
that are more difficult to reach (such as deep in an ocean), or where
the quality of the oil is lower, or it requires more expensive technology
to extract, or the extraction process creates significant environmental
damage, or all of the above. As an example, an article in the Financial
Times (16 March 2005) quotes PFC
Energy as reporting: "With increasingly depleted reserve bases,
non-OPEC declines are only expected to gather steam in the years to
come." And output from some OPEC countries is already declining.
For more details on the status and issues of peak oil visit
The Oil Drum.
- Oil is used primarily for transportation.
Although there are other uses for oil, such as electrical power, petrochemicals
and plastics, transportation systems and vehicles account for roughly
75% of US consumption. Half of transportation oil consumption is for
light vehicles--automobiles--and, lately, gas guzzling SUVs and light
trucks. Urban automobile transportation accounts for more than one-third
of all transportation energy use in the US. Half of that, in the US,
is for commuting to and from work.
- Transportation demand is relatively
inelastic. We learned in the oil crisis in the early 1970s
that US automobile owners' demand for fuel is relatively price-insensitive.
Since, they think, they need their vehicles to get to work, they are
willing (if grudgingly) to accept price rises. At some point it is possible
that oil prices will produce significant resistance but that point has
not yet been reached (well, maybe; see
our blog for July 2008 for more). More important, vehicle owners do react strongly
to scarcity of fuel. Price is one thing but waiting
in line for hours to partially fill one's tank is entirely another,
as was demonstrated in the US in the 1970s and in Iraq today.
- Transportation demand is increasing.
Automobile use is increasing everywhere population grows, particularly
in the developing world. Although the West is still the primary oil
consumer, with the US well in the lead, China's demand has grown to
the point where it is actively seeking to capture the output of Asian
and other producers. At the moment, almost all the oil producing countries
are producing at full capacity in order to satisfy current demand. Unless
the laws of economics are somehow abolished the inevitable outcome of
this situation is an increase in prices, oil shortages, or both, not
to mention political repercussions. At some point, regardless of price
issues, demand will exceed supply, as shown here just for developed
world demand. Note that the projected crash is shortly after 2015.
Please also note that the graph above does not include
consumption from countries such as China and India. China is already
the world's second largest consumer of petroleum and the annual growth
in its demand currently exceeds 12%. This could move the demand-supply
collision point to less than a decade away. With what economic, political,
and/or military repercussions?
- Alternatives do exist, sort
of. Under the business-as-usual category there are alternative
modes of travel (mass transit, car and van pools); more fuel-efficient
vehicles (such as the Toyota Prius); and alternative fuels (ethanol,
methanol) or energy carriers (hydrogen or batteries). All of these,
in principle, can let us carry on pretty much as before in our transport
behavior. The problem is that some of these alternatives have been tried
and found wanting--acceptance of mass transit and vehicle pooling hasn't
changed much over the past few decades in spite of large promotional
efforts--or are just in the early development stages.
The only option that will produce significant changes in transportation
patterns and energy use is modification of behavior. One of
the chief characteristics of teleworking is that it does effectively
reduce the use of transportation. Telecommuters, for the most part,
don't use their vehicles on the days they are telecommuting. Business
travel is being replaced by email, IMing, computer-, audio-, and video-teleconferencing.
All these alternatives use far less energy than the transportation modes
they replace.
What next?
Although telework has enjoyed considerable success over the past three
decades, the time has come to get serious about its future. It may soon
no longer be a case of tweaking business performance or personal work-life
accommodation but of survival in a world-as-we-would-like-to-know-it. After
9/11 we have received an increasing number of queries about telework
as a disaster recovery option. Now it's time to think about disasters other
than those created by terrorists or upheavals in the Earth's crust.
In its 1 April 2005 lead story the Financial Times posted the
following list of recommendations from the International Energy Agency:
- ENERGY SAVING RECOMMENDATIONS:
- Carpooling: introduce special lanes along all motorways
- Driving ban: enforce odd/even number plate schemes
- Speed limits: reduce highway limits to90 km/hour
- Public transport: lower fares or cut them altogether
- Telecommuting: inform public of benefits of working from home
- Compressed working week: introduce programmes with employer backing
Now the evidence is mounting that a global clash for oil resources might occur as China
and India become more agressive--and Iran becomes more truculent toward the West. The best way
to weather a crisis is to be prepared for it well in advance. For more on a similar potential
crisis situation consider the bird flu problem.
Jack Nilles
Telepicker
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Last modified:
Tuesday January 12, 2010.
