Peak Oil: What do we do now?

Our problem now is that we have built a complex economy that depends on oil and other fuels. We can see that we will have less oil in the future. The question is, “What we should do, in planning for a change in the world?”

Our natural reaction is to try to build add-ons to our current system that we hope might make the system work longer. I am afraid these will be mostly ill-advised, because the system is more complex than we understand, and well-meant changes may have adverse impacts.

What we really need is a new system that will work for the long-term. But such a system is so far away from us now, it is hard to even think about how it would work, and how we would get from our current system to the new system.

Our Current System

Our current system is a complex one that has evolved over a period of years. It is built upon a complex financial system, international trade, and many high-tech goods. Most people in the US live in homes that are heated and cooled to comfortable temperatures year-around and have access to a private passenger automobile, things that people in years’ past would have never dreamed possible.

The problem I see with our current system is that it is not likely to be very resilient. The current system depends on huge energy inputs. We can already see stresses as these are reduced.

Changes which don’t seem too big to us, and which seem to be helpful, could very well disturb the system. For example, conserving electricity would seem like a step in the right direction, but even this little step is likely to affect the finances of utilities, and is likely to make the construction of new, more efficient electric generation less feasible. When we make one change to try to make things better, we may in fact be making changes that make the system as a whole work less well.

There may be some specific changes that can be helpful, but it is difficult to know in advance what these are. In my view, these changes are likely to be the ones that require least government intervention, because they “make sense” without subsidies. For example, adding some geothermal electric generation in a location where geothermal is available, or making some natural gas vehicles if there seems to be a temporary oversupply of natural gas may make sense.

The big problem I see with our current system is that over the long-term (and perhaps not-so-long-term), it can’t continue to work, because the fossil fuels on which it depends are being depleted. Nearly all of the things (wind-generated electricity, solar PV, electric vehicles, fuels from algae) we are thinking about now are simply add-ons to the current system. Once the current system stops working, the additions will be of little benefit. Even something that looks resilient, like solar PV, stops working once there are no more light bulbs available for it to light up, and once back-up batteries are no longer available.

What we need: A new resilient system, that doesn’t depend on fossil fuels

We clearly will eventually need a new plan, but we haven’t even given a thought to what it might be. It is relatively easy to come up with a proposed component of the plan, but even this may not work out in practice.

For example, one can develop a plan for growing crops in an area that requires soil amendments to be brought in from some distance. Even though these amendments are “organic,” the fact that they must be transported some distance is likely to make the system not sustainable, without substantial fuel inputs.

As another example, I saw a plan developed by graduate students showing how we might build sustainable 1,600 square foot homes out of local materials. I would have a number of questions: How much labor will it require to build (and frequently rebuild) such homes? Will this be too much for a new poorer society? Will it be possible to heat such a large home, or should we be aiming for smaller homes?

We do have examples of societies that “worked” in the past, with virtually no fossil fuel inputs. In fact, if we look around the globe, some of these might be quite recent. It seems to me that we need to be studying some of these in more detail, to see if we can figure out what might work going forward. For example, quite a few of these used animal power, both for plowing fields and for transporting goods. If we were to start adding more animal power, what would this imply for land use? How did past societies deal with the need for shelter for themselves and their animals? How did they handle making clothing, and manufacturing household goods?

Societies don’t just spring to life. They evolve. That is a big reason our current situation is so difficult. We are trying to model the future based what we have now, but our current model is very much tied to our current fossil fuel use. It is hard to imagine that our system will work for the long term.

Instead, it seems to me we would do better to model the future on what we had at some time in the past, because at least this would give us an idea of what combination of home sizes, use of animals, size of farms, and even political structure worked in the past. I doubt people today would find this approach very acceptable, though, since so many things have changed–for example, modern medicine and the Internet, and it will be hard to give these up.

Our predicament

So what do we do? Just keep adding on to our current system, and hope that somehow we can keep it together a while longer? Or start working on a new, sustainable system for the long term?

If we do work on a new, sustainable system, how can we get our minds to even think in terms of what life might be like, essentially without fossil fuels? Is modeling based on the past (with perhaps a few additions to reflect the current situation) really our only alternative? Or is it possible to build a ” higher” sustainable system, using mostly local inputs, even though at this point, we don’t have a good model of what this might be?

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About Gail Tverberg

My name is Gail Tverberg. I am an actuary interested in finite world issues - oil depletion, natural gas depletion, water shortages, and climate change. Oil limits look very different from what most expect, with high prices leading to recession, and low prices leading to financial problems for oil producers and for oil exporting countries. We are really dealing with a physics problem that affects many parts of the economy at once, including wages and the financial system. I try to look at the overall problem.

55 thoughts on “Peak Oil: What do we do now?

  1. Gail wrote: “Even something that looks resilient, like solar PV, stops working once there are no more light bulbs available for it to light up, and once back-up batteries are no longer available.”

    Along those lines, any source of electricity will eventually become obsolete. Electricity, producing it and its many uses are genies out of the bottle. We will have fallen far indeed when we can no longer imagine and implement uses for the energy produced by PV.

  2. Hi Gail,

    Thanks for your thought provoking article. One among many, in your case.

    Some years ago, as a convert to the “peak oil possibilities” I started researching all the avenues of renewable alternatives and by about mid 2006 I could only find one small ray of light gleaming under the closed door of reality.

    So I looked more and more closely and realised that while many were ridiculing the efforts of this stealth developer (one among many different efforts being ridiculed, I might add), the more convinced I became that a number of major institutions had gotten on the same bandwaggon.

    Some were involved with access to what is happening and some became sufficiently convinced the science holds the key to energy storage to start working out how they may compete.

    Of course the product and its developers have been rubbished on TOD and in many forums. Yet the company in question, EEStor continue to work under the radar, popping up every now and then with a patent that gets the knowledgable bloggers in a tizzy. Perhaps if people knew the pedigree of those involved they may not be so scornful. Perhaps if people were to also read the patents they would realise that this appears to be an avenue of serious scientific endeavour.

    The link to the patent documents is shown herewith:

    Frankly, I have no idea whether the EESU will ever materialise as a viable commercial product. If it does not do so, I have no idea how we may forestall the worst effects of post peak energy shortages…. touted by the so-called “doomers”.

    But there was a time of great hope when we were able to locate Polarity as the electronics company working with EEStor and Sachem, the potential supplier of pure BaTi O3 powder…and a barite mine. Of late, apart from patent reveallations the only encouragement that has come for the cadre of “fanboyz” has been the news of the efforts of other well funded, substantial research organisations trying to move along the same track.

    More recently we have people like John Doerr making pronouncements about the coming era of ultracapacitor energy storage.

    Most of us investors regard Zenn Motor Co (the only possible avenue of investment in EEStor) as a bit of a long shot. But we know the odds of solving our futue energy needs without such a breakthrough. So we sit tight and wait, with some more patient than others.

    But if anyone knows of a different solution to our post peak blues, I would love to hear of it.

    Kind regards

    • It would be good if something would work, but we have been trying for a long time without coming up with much. I suppose we can keep our fingers crossed, but it might be good to make some backup plans as well.

  3. In the last half dozen years we have worked hard at “adjusting” to what is obvious. Life is going to change. I am not sure if it is a Richard Duncan change but it is changing. While I believe we have done well by plopping down in a small upper Midwest village replete with PVs, wood, local food, etc, and a visit to a few Amish communities, the idea of the 6 or so million folks that live from Milwaukee to Gary doing a similar thing does not equate.
    While it is easily possible for small groups in agriculture areas to modify behavior in the direction of the Amish, it is not possible for large populations. That is one dilemma.
    I am also doubtful that the “depleting” economy will be able to modify the chaos from depleting energy. The economy will follow the downward spiral of oil and in doing so will eliminate the ability of societies from developing the expensive alternatives. This is already happening with nuke development. No private corporation can now build them and Boone Pickens has stopped his wind project for lack of funds. I don’t see how in a declining economy (and this may be a radical decline) capitol needs can be met to make the sophisticated changes that will be needed.
    If the “Amish option” is not realistic and high-tech wizardry will not fly, what is left?

    • Dennis Meadows of “Limits to Growth” fame says that lack of capital is the what is likely to be the limiting item, causing the world economy to hit limits and start its rapid decline. I think that is what we are experiencing now. Quite a few people think that we can “hoard” the energy we have now by building wind turbines and solar PV, but I doubt that it will work for very long, after other things collapse. Instead, it will use us scarce capital, that could better be used for trying to adapt to a world that is rapidly changing.

  4. I think another issue that will hit at the same time as peak oil, is a collapsing currency. Every thing the US government and federal reserve do, show a complete disregard to fiscal restraint. No one has really predicted what happens when the world’s reserve currency is in hyperinflation and all the major banks are functionally insolvent.
    It will be very difficult to impossible to finance any kind of multi-year project without a stable currency. Whether its new power plants, off-shore oil platforms, geo-thermal, efficient buildings, electric railroads, electric cars, or government dormitories for the unemployed. None of this stuff is going to be built with an unstable currency and non-functioning banks.

    • About the only solution I could figure out for this is if governments use their taxing power to build multi-year projects. This would seem to work.

      I suppose there might also be a possibility of people pooling savings, and using these for investments (like Lloyd’s of London), but in a declining economy, the chance of getting the investment back would be less, so it would seem to be less likely. Also, it would be more difficult to accumulate funds for investment.

  5. What we have in the past that worked was…LESS PEOPLE

    Our system would have no problem at all if we were a few hundred millions, on the otherhand with 7 billions we are about to collapse and take the whole world with us.

    If we try to act like we did a few hundred years ago, returning to small farms and producing locally we´ll destroy this planet in a few days

    • This is a major issue. Even a one-child policy doesn’t fix it very well. I wish I had a solution.

      The world can support some people, if not as many as today. The understanding that this can happen, and the hope that the downslope will be slow, offer at least a somewhat positive view.

  6. Imperial College, London, had an interesting press release yesterday (Dec 17), “You Only Live Once: our flawed understanding of risk helps drive financial market instability.” Darn, the link won’t paste (and it’s long). You can get the article and link at in the breaking news section.

    Anyway, the thrust is that scenarios can be run in parallel and an average taken (ensemble averaging) or run in sequence (time averaging). They find that ensemble averages hide risk. This is typically how people consider future societal scenarios; they “do/mitigate” things in parallel. One point the the article makes is that past decisions cannot be undone.

    This merely deepens my belief that no rabbit will be pulled out of the hat for any of the crises we face. And, in fact, things will be worse.


  7. The solution for US/Canada as far as liquid fuels goes is to make all cars, LT flexfuel (aka E85/M85) and increase CAFE to 35 mpge. Both of these are current technology, if the average car life is 15 years then mandating these requirements now will be fully implemented in about 25 years.
    About 60% of our 7.2 Gboe oil use goes to personal transport or 4.32 Gboe at an average mpg of 22 mpg so a 33 mpg average would reduce that to 2.85 Gboe.
    Minimizing oil use would mean replacing 2.43 Gboe with ethanol and methanol.
    The US government estimates that cellulosic technology can produce 1 Gboe of ethanol from a 1.3 billion ton renewable biomass resource.
    That leaves 1.42 Gboe of methanol to be produced from natural gas or coal.
    The efficiency of producing methanol liquid fuel is much higher than F+T gasoline.
    If 1 ton of coal = 4.6 barrels of methanol=2.3 boe then it would take 617 million tons of coal per year(57% more coal than US current production) to produce the necessary methanol.
    The alternative without all this additional coal mining is to simply reduce personal driving by 50% to be accomplished by mass transit, carpooling, car share, telecommuting, etc. which I believe is an achievable goal.
    If we adopted full E85/M85 conversion(no more drastic than installing seat belts) and 33 mpge minimum CAFE personal transport with a mandated 50% driving reduction we reduce our petroleum consumption to 331 Gboe between now and the year 2100 which could be handled by Alberta tar sands and Colorado oil shale with NO imports after 2040. Yes, fully tapping these unconventional resources will require a moonshot effort but growth from 1.3 mbpd to 9 mbpd over 30 years is a straight line increase of 20% per year, hardly a record and there will still be considerable resources beyond that.

    • Suncor released its 10 year plan this week.

      They plan to go from 300K bpd to 1 mbpd over that time. They also accepted a $1 billion investment from Total for joint production of various Athabasca sites towards that goal.

      I would be surprised if all sources of oil sand production can get to 5 mbpd in 10 years. I would expect a major effort by China to destroy them long before then.

    • Majorian,

      You don’t get it. The future is a “package deal” where things are not done in parallel as you suggest v. transportation but rather in concert from a coherent plan. It’s late for me so I won’t expand my comments at this time.


  8. What it looks like to me is that we are all in agreement. Nothing we know of will work for the entire world population. There are no changes that can be made that will accommodate everyone. It is simply too late.
    While I might admit that under some perfect setting where our leaders are all wondrously informed that some mitigation might be possible. As it stands it is hopeless. Why pretend.
    Global warming can not be stopped (even Tom Friedman agreed) because of too many feed backs, world population growth can not be arrested (we might be a plague species), resources depletion, while recognized as an issue, can not be addressed due to exponential population growth and greed, and the present economies can not be adjusted because Milton Friedman still rules the day–as well as greed (which is good!) So there you go, toast.
    However, I believe adaptation may be the rule of the day. Anticipate the changes and make adjustments to meet the changes. This can be done on an individual level, family group and as a community (small). It is all about positioning. If we know certain events are going to occur, then take care of those closest. Forget the others.
    While it is unsaid in many circles, I believe this is what is being proposed by many writers and advocates from the transition movement to J Kunstler. There will be no master plan to bail the entire world out. As an earlier poster mentioned, we must evolve with the changes. The Arch Druid, Carolyn Baker, Sharon S., N Hagens, Gail & a multitude more are all seeming to move in this direction even though they are still actively working for a big answer.
    What do we do now? Position ourselves.

    • I am afraid you are right about adaptation. It is nice to think that humans collectively can change how things will turn out, but I think that the “cake is already baked”. There are also too many forces we don’t fully understand, from how all the parts of the economy function together to all of the influences on the climate, for us to be able to truly make the changes we think we can. Humans have adapted to ice ages in the past. Whether we like it our not, we pretty much are going to be forced to adapt to the future. It seems like there are at least some things we can do, in terms or leaning how to do things as they have been done in the past–growing food locally, for example–but I expect we are kidding ourselves if we think we can be “saved” by the next gee whiz invention, or even the next plan to reduced CO2 emissions.

    • Hi D Wright,

      For a few years, I’ve been fretting about FF depletion, GW, species extinction, biosphere degradation and all that combined with escalating human population growth and increasing monetary issues. I’ve often suggested some human behaviors that might help mitigate the worst consequences – especially for future generations of humans.

      My life experience informs me that problems are rarely solved without a good understanding of the actual problem – the observable symptoms and the true underlying causes. I find the next step should be the setting of realistic goals and objectives. Only then can alternative solutions be debated, implemented, measured and modified/refined by feedback loops.

      I now think more about “tilting at windmills” as analogous to my own behavior. I see scant evidence that any critical mass of opinion makers even begins to understand the problems facing humanity and the planet at large. The incessant media/political drumbeat is the need to stimulate “growth” – any and all growth. The US media is flooded with incantations to consume ever more obscene quantities of the planet’s resources. Energy companies spew disinformation that would probably make the architects of the Tiananmen Square “big lie” blush with embarrassment. Most proffered “solutions” are either blatant attempts at self-serving profiteering or well intended, but hopelessly naïve, schemes that fall on deaf ears.

      How can we expect the average person to have sufficient critical thinking skills when 80% of them think there is a supernatural dimension to their world where the problems they face in this lifetime will become insignificant compared to their afterlife eternal reward in the spirit world? Where is the capacity to understand the simple concept of “truth” as defined in the scientific method?

      I wonder if it is inevitable that humans will simply do the same thing most other species do: exploit their environment for their immediate benefit with no concern for the future? Certainly, we have the capacity to understand our problems, set realistic goals, and implement solutions that could benefit not only future generations of humans but the balance of life on the planet itself. However, I see little evidence that we will utilize that capacity beyond a kind of “muddling through” paradigm. If that is actually the case, how important is our fretting about “what we should do”?

      Perhaps D Wright is right: “Anticipate the changes and make adjustments to meet the changes.” Maybe the best reason to follow a blog like this is to simply increase our personal awareness and maintain an attitude of flexibility as events unfold. Perhaps we can’t persuade the world at large to be more aware – maybe we are just tilting at windmills.

    • When I think about adaption of any sort, I think about having personal or community reserves of a resource to deal with the coming situation. The black bears around my cabin go on a Fall eating binge to get through the winter “hibernation”, the Amish “put up” canned food in the Summer and early Fall till their gardens start producing in the late Spring etc. Through the 1930’s the Society of Oddfellows local chapters, and many other groups would contract with a local physician to provide “free” healthcare (paid for by their dues) to their members. One could go on..

      Our (north american) society has decided to create very complex resevoirs of resources that are at quite a distance whether geographically or through other means (administratively might be an example). Social Security, Medicaire, Medicaid, interstate distribution of electricity, NG, and many many more seem like examples of this situation.

      I am pessimistic about expectations of delivery or further investment in anything that does not appear to have an easy local adaption, or are by
      design local.

      Design local Examples Might Be: home garden, community garden, a wood stove and means to obtain firewood, PV with batteries, Trombe wall, participation in a herbal remedy network, a well, a cargo bike.

      I would be skeptical of depending on interstate importation of electricty, which means that almost all of NYS (Quebec Hydro sourced), and NewEngland (fed by WVA and PA I believe) are a writeoff. I do think it
      is in the realm of possability that a local/regional/mult-county grid could
      be kept going around a nuclear plant or hydro for a quite a long time. Albany’s coal plant won’t, but possibly some of the coal plants could continue that are co-located with the fuel.

      Given what I’ve seen over the past decades, electricity is required to keep anarchy at bay in the US. There is simply not enough National Guard to maintain order, in parallel there is simply not enough reserves of fuels in and around any city or town for it to migrate out on its own, with three days of food deployed in most urban situations (it is better with the Amish!), these three horseman and water are where the initial dieoff happens.

      It is not a pretty picture.

  9. The fundamental change that needs to occur is to drop the pretense that human beings are more important than any other species. This false morality is only a tool used to convince ourselves that we are being ‘noble’ when we consume things that we shouldn’t consume. The human modus operandi of late is a form of Manifest Destiny toward self destruction. It is the mindset of consumption for the sake of humans, rather than humans for the sake of being useful to the universe. In other words, humans will have to either learn to give back more to the planet than they take, or they will go extinct as fast as they humanly can (which is actually pretty fast).
    The here and now data of what we do (consume) vs. what we give back (little) is not looking good. Regardless of whether we have oil to burn or cold fusion or zero point energy, humans will either have to reverse their selfish attitude as a species or just simply fail to do so. What we imagine we are doing doesn’t matter. What we imagine the future will be doesn’t matter if our actions right now are designed and marketed to consume the future (create debts, both monetary and physical).
    What are people FOR? Who cares how much oil they have if they are simply doing stupid stuff with it?
    Human choices are not so intentional as we think they are. Most are made in a moment of emotion. That means at the cash register. That’s where influence should be wielded to change direction, and that means a consumption tax which reflects the true costs, as well as elimination of all income taxes, which hide the costs before the individual can do anything about it.
    Gail’s example of reducing energy use reducing the demand for newer, efficient power plants is then avoided, because the high environmental AND government costs would be reflected at the purchase point, pushing the reduction in energy use away from those places that require tax money to support them. Localized, human energy would become more valuable, as would the individual.
    The bottom line is that cheap energy(and cheap food) leads to cheap people. Cheap people are dysfunctional and powerless.
    One dollar, one vote: this is democracy as we know it.

  10. I don’t worry so much about a big die-off; after all, everyone alive today will be dead in 100 years no matter what happens. Even if the vast majority of people now alive do die without producing offspring and world population shrinks to a fraction of its current level, there will always be tribes and villages left somewhere to continue the human species.

    But there are a few bad things that could happen that would make even that prospect problematic. Large scale nuclear war is one. I doubt if bio-war could wipe out everyone, but it might come close. I sometimes wonder about the long term consequences if we simply abandoned our nuclear facilities, including waste in cooling pools and dry cask storage, reactors, or even weapons and weapons waste. Would lethal amounts of radioactive materials gradually migrate down rivers and end up in the ocean?

    I once read that at one time there was enough radioactive iodine in waste tanks near the Columbia River at Hanford to kill all life in the oceans. I think they have reinforced those tanks, but I am sure the waste is still not in secure multi-thousand-year storage.

    Climate change; massive human die-off; the end of industrial civilization: these are all small change compared with lethal worldwide radioactive pollution. Not only would we be gone, but so would much of the other life on earth. I know that this planet doesn’t mean all that much in a universal context, but it would be a real shame to see this little oasis come to a bad end. The least we can do is clean up our mess before we go.

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