EROEI

Perfect Storm

 

Sunday evening I went to a lecture by Jeanette Fitzsimons on the subject of "Steady-state Economy".

 

She quoted extensively from a report by Dr Tim Morgan of Tullett Prebon in London under the above title.

 

The key point is that the economy is not a matter of money - that is just the language we use to talk about it. The economy is really a question of energy production and use, or rather of the use of surplus energy.

 

Surplus energy is the extra energy we can produce, historically first, through agriculture, and secondly from the Industrial Revolution on, through mining fossil fuels (or other fuels) and using them in various machines.

 

The argument is that we are already at the point where the signs are indicating the near-collapse of the "growth" economy we are used to.

 

And that before long energy prices will force us all to change our lifestyles to conserve what energy we have available. We will be forced out of the suburbs to high-rise city dwelling, to abandon private cars for public transport, and so on.

 

I have read the report and thought about it since, and am still working through the implications. But it certainly means we should be re-thinking many of our everyday activities.

 

For instance, one of Morgan's key consequences is that higher energy prices will flow on to higher food prices, because food will be uneconomical to produce to some extent. So we need to be thinking carefully before we eat more than we really need each time we sit down to a meal. 

 

In his report, at

 

http://www.tullettprebon.com/Documents/strategyinsights/TPSI_009_Perfect_Storm_009.pdf,

 

Morgan introduces the idea of EROEI. That is Energy Return on Energy Invested. In other words, how much energy do you get out of each unit invested in the production of energy?  

Before World War II, for instance, each barrel of oil spent producing more oil returned 100 barrels. Since then  the ratio has come down (2010) to around one barrel spent producing 40 barrels. It is predicted that this figure is now about 1:20, and will fall to 1:11 by 2020. Anything less than 1:15 makes fuel production impossible: it's just not worth spending the energy to do it.

 

How do you think we can manage when the planet can no longer provide all the energy we want, nor absorb all the waste we produce?

 

And the growth of population is not the real problem, it is the amount of energy used over and above what we each produce, and the waste produced per head, that is crucial.

 

Anyway, read the report yourself and see what you think.