Thursday, October 25, 2007

German Environmental Foundation announces Peak Oil is here.


Peak Oil is here and was reached in 2006, announced the Energy Watch Group in London on October 22, 2007. This simple statement will progressively affect our whole society, particularly our food production, energy and transportation systems. Demand for oil is already outstripping supply with the industrialization of India and China. Oil production is at capacity and will soon start to decline at an increasing rate. Crude oil hit $88 a barrel recently and is set to rise even further once the decline in production becomes apparent.

"The most alarming finding is the steep decline of the oil supply after peak", warns Jörg Schindler from the Energy Watch Group. This result, together with the timing of the peak, is obviously in sharp contrast to the projections by the International Energy Agency (IEA). "Since crude oil is the most important energy carrier at a global scale and since all kinds of transport rely heavily on oil, the future oil availability is of paramount importance as it entails completely different actions by politics, business and individuals.", says Schindler.

Until recently the International Energy Agency has denied that a fundamental change of energy supply is likely to happen in the near or medium term future. Hans-Josef Fell MP, a prominent Green Party member of the German Parliament said "The message by the IEA, namely that business as usual will also be possible in future, sends a diffusing signal to the markets and blocks investments in already available renewable energy technologies."

The Energy Watch Group was initiated by Hans-Josef Fell, Member of the German Parliament (deutscher Bundestag) since 1998, Speaker for the Energy and Technology Policy of the Parliamentary Party Alliance 90/The Green Party and Chairman of the Environment Committee, Nature Conservation and Nuclear Safety. Parliamentarians from other countries have since become involved in the organisation which is supported by the Ludwig-Bölkow-Foundation. Funding by the foundation allows project scientists to work on studies independently of Government and company interests concerning the shortage of fossil and atomic energy resources, development scenarios for regenerative energy sources as well as strategies deriving from these for a long-term secure energy supply at affordable prices.

The report says that remaining world oil reserves are estimated to be 1,255 Gb (Giga barrel) according to the industry database HIS (2006). But the Energy Watch Group (EWG) contradict this figure and say that there are sound reasons to modify these figures for some regions and key countries, leading to an estimate of 854 Gb. The EWG analysis is based primarily on production data which is more transparent and thus more reliable than reserves data which in the past have been frequently "adjusted".


Peak Oil is now, the report says, and it signals that human society is at the beginning of a structural change of its economic system. A sharp decline of fossil fuel supplies will influence almost all aspects of daily life according to the report. Climate change will also force mankind to change energy consumption patterns by significantly reducing the burning of fossil fuels.

The report warns that supply shortages could easily lead to disturbing scenes of mass unrest and a meltdown of society. "My experience of debating the peak oil issue with the oil industry, and trying to alert Whitehall to it, is that there is a culture of institutionalised denial in government and the energy industry. As the evidence of an early peak in production unfolds, this becomes increasingly impossible to understand", says Jeremy Leggett, the Solarcentury CEO and former member of the British Government’s Renewables Advisory Board.

Now the crunch is upon us with both peak oil and climate change. Time is fast running out for making structural changes in our energy and transport systems to cushion the impact of peak oil. And still we see Governments the world over committing resources to major road building when the prospects for road transport are looking particularly bleak with the projected increase in fuel prices as oil demand and prices skyrockets. Few Governments are pledging large scale expansion of the public transport and rail freight system which may soften the social impact of peak oil and reduce greenhouse emissions.

Most food production is now highly capital intensive and relies on oil as a fuel and as fertilizer products. When oil is too expensive to use, our farming techniques will need to adjust to smaller scale agriculture more dependent on human labour. Are you ready to become a farmer?

The business as usual scenario can only result in many people being hurt.




If you want to see an example of a society forced to experience peak oil, the Soviet withdrawal of support to Cuba after 1989 precipitated an oil crisis which forced food rationing, a major shakeup of public transport and agricultural systems. "The Power of Community: How Cuba Survived Peak Oil" is a documentary about how Cuba faced this crisis. Soon it will be our turn for the crisis. How ready are you? How ready are our governments? Do we really need expanded roads and taxcuts with a peak oil crisis looming?

The executive summary conclusions of the report say that:
  • Production will start to decline at a rate of several percent per year. By 2020, and even more by 2030, global oil supply will be dramatically lower. This will create a supply gap which can hardly be closed by growing contributions from other fossil, nuclear or alternative energy sources in this time frame.
  • The world is at the beginning of a structural change of its economic system. This change will be triggered by declining fossil fuel supplies and will influence almost all aspects of our daily life.
  • Climate change will also force humankind to change energy consumption patterns by reducing significantly the burning of fossil fuels.
  • The now beginning transition period probably has its own rules which are valid only during this phase. Things might happen which we never experienced before and which we may never experience again once this transition period has ended. Our way of dealing with energy issues probably will have to change fundamentally.
  • The International Energy Agency denies that a fundamental change of our energy supply is likely to happen in the near or medium term future. This sends a false signal to politicians, industry and consumers.

Sources:

Based upon an original story from Sydney Indymedia - Peak Oil Has Arrived: Report Warns of Social Meltdown