Peak Fuel and Climate Change

You can't always get what you want

-Mick Jaggar

Greetings
   
            If we don't put a brake on our fossil fuel usage, what then?   We burn it as long as we can.  How much would that be?  And how much CO2? 

      Maybe its time to take a closer at the implications of peak carbon fuels on climate change.

       Why?  Well the prospects for a deal are pretty slim.  This article describes a number of hurdles, including the prevalence of the neo liberal economic paradigm, the wealth inequity and resistance to wealth re-distribution.  Of particular importance is the lack of time .

      "The inability to gain any traction over the past two decades, together with the carbon emissions intensive development of such countries as China and India driving global emissions to a new high in 2012¹⁰, has removed much of the time available for global society to reach a viable solution. In the cases of the EU and the GATT/WTO efforts took many decades to reach fruition. Modern society is based upon the exploitation of fossil fuels, firstly coal and then oil and gas. The energy provided by these fuels has become central to the existence of our complex societies as evidenced by the impact of the electrical supply failure in parts of the United States and Canada in 2003, or the blockade of oil depots in the United Kingdom in 2000. These fuels are also used as inputs to chemical processes that provide the bases for an extraordinary percentage of critical products, such as fertilizers, medicines, and plastics. Thus, actions required to limit the gases produced by burning and processing these fuels are bound to have wide-ranging economic impacts. Such actions will include the replacement of a fossil fuel based energy infrastructure with one based upon renewable energy, together with carbon capture (if viable) for fossil fuel usage. The historical experience is that such large scale technological changes take decades to fully defuse throughout an economy¹¹. 

     Recent statements by the principle participants back up this bleak assessment. See .eg.  IPCC Budget will not drive climate talks.

"But Christiana Figueres, executive director of the UN Framework Convention on Climate Change, said carbon budgets were a good scientific exercise but said that they could not be the basis for negotiations. "I don't think it's possible," she told the Guardian in an interview. "Politically it would be very difficult. I don't know who would hold the pen [in setting out allocations of future budgets]."

..    See also - de Boer , the outgoing UNFCCC executive secretary.. For instance  (H/T Reuben)

“There is nothing that can be agreed in 2015 that would be consistent with the 2 degrees,” said Yvo de Boer, who was UNFCCC executive secretary in 2009, when attempts to reach a deal at a summit in Copenhagen crumbled with a rift between industrialized and developing nations. “The only way that a 2015 agreement can achieve a 2-degree goal is to shut down the whole global economy.” 

     So what should we expect if things just take there course - i.e we just keep on burning until we can't?

      The IPCC has given us some pretty scary scenarios, but they have been based on assuming that the resource base is huge, and that the the costs of producing them will be low enough to support continued economic growth. 

     However these assumptions may not hold up.   In fact, these extreme scenarios are looking less and less likely.

     The most recent meeting of the Geological Society of America  featured a panel on peak oil, featuring among others, David Rutledge, Charles Hall, and David Hughes.  The panel was chaired by James Murray, a professor of oceanography at the University of Washington.  .  (see Scientific American Peak Oil May Keep Catastrophic Climate Change in Check)    ( see summaries of some papers here)

"

"Conventional production of oil has been on a plateau since 2005, said James Murray, a professor of oceanography at the University of Washington, who chaired the panel.

As production of conventional oil, which is far easier to get out of the ground, decreases, companies have turned to unconventional sources, such as those in deep water, tar sands or tight oil reserves, which have to be released by hydraulic fracturing.

But those techniques tend to lead to production peaks that tail off quickly, Murray said.

"The panelists said these trends  belie the high-end emission scenario from the Intergovernmental Panel on Climate Change (IPCC). That scenario, known as RCP 8.5, and often referred to as the "business as usual" scenario, has carbon dioxide emissions increasing through 2100.

"I just think it's going to be really hard to achieve some of these really high CO2 scenarios," Murray said.

  Likewise  David Rutledge, Professor of Engineering at at CalTech. 

Rutledge said of the four IPCC scenarios, he found the second RCP scenario, RCP 4.5, where carbon dioxide emissions flatten out around 2080, to be more plausible under a business-as-usual scenario for coal exploitation.

"4.5 would be the closest one if you look at the mining history," Rutledge said. "My own opinion is that no one should use RCP 8.5 for any purpose at all."

        I recently came across a presentation by David Hughes, formerly of the Canadian Geological service, where he specialized in assessment of coal and natural gas reserves.  He notes:

"The Climate Change dialogue for the most part excludes any consideration of resource limitations on growth, and hence leads us down some counter productive pathways, although initiatives on conservation, efficiency and renewables fortuitiously also address the energy question."

    Or, consider the views of Kjel Aklett, president. of ASPO,  who suggest that of the 3.67 trlllion tons of CO2 allowed in the IPCC budget, only 2.33 trillion will be burned regardless...    discussed in this article

   

Recently the IPCC published an estimate that the world must limit the future mass of carbon burned to one trillion (10⁹) tonnes in order to achieve a 66% or greater likelihood that future global mean surface temperature increase will be limited to +2°C [28].  When burned, one trillion tonnes of carbon becomes 3.67 trillion tonnes of CO₂. Aleklett calculates that probable CO₂ emissions from conventional oil, gas and coal production between 2010 and 2100 will be limited to 2.33 trillion tonnes. "

       

       A similar view is reached by Tad Patzek, a chair of the Petroleum  and Geosystems Engineering Dept at the University of Texas, Austin.   He notes that:

      "... under the 40 different U.S. Intergovernmental Panel on Climate Change (IPCC) scenarios, 36 of the 40 scenarios predicted future carbon production and CO2 emissions at today’s rate of coal production.  Credible forecasts of coal production, by contrast, predict a 50 percent reduction over the next 50 years.

“Most of the IPCC scenario writers accepted the common myth of 200–400 years of coal supply, and now their “eternal” (100 years plus) growth of carbon dioxide emissions in turn is a part of the commonly accepted social myth,” says Patzek.

“The IPCC carbon estimates, which are used by all major decision makers, are based on economic and policy considerations that appear to be unconstrained by geophysics,” says Patzek.    see here

    

           One other factor, which is not incorporated, is the chance of  economic turn down.  All of these projections assume that the world economy will continue to grow, even after oil production begins to drop.  As noted below, by Tim Morgan, author of Life after Growth,  the economy is already fragile and overloaded with debt..  A spike in oil has historically resulted in less economic activity..

     A recent paper   "Economic Vulnerability to Peak Oil, ($35.95!)   may shed some light on what could be expected.  The authors assume a peak this decade.

"In their paper, the research team constructs a vulnerability map of the U.S. economy, combining two approaches for analyzing economic systems. Their approach reveals the relative importance of individual economic sectors, and how vulnerable these are to oil price shocks. This dual-analysis helps identify which sectors could put the entire U.S. economy at risk from Peak Oil. For the United States, such sectors would include iron mills, chemical and plastic products manufacturing, fertilizer production and air transport."

       So, if we keep on the present course, things look grim, but perhaps not as grim as assumed by the IPCC.  RCP 4.5 is,  of course.  not to be wished for.   It is expected to result in 650 PPM and 2.5 degrees  here.  Rutledge's own calculations  result in about 450 PPM. - also destructive.

     
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Economic perfect storm: The four trends that killed Western growth 

THE West lies at the confluence of four extremely dangerous long-term developments. Individually or collectively, they have already begun to reverse more than two centuries of economic expansion.

The first is well-known: the creation of the worst financial bubble in history – “the great credit super-cycle”. Since the 1980s, a relentless shift to immediate consumption resulted in the accumulation of debt on an unprecedented scale. The financial crisis was not entirely the result of a short period of malfeasance by a tiny minority. What began in 2008 was the denouement of a broad-based process that lasted for 30 years.

The problem is shown in the relationship between GDP and aggregate credit market debt in the US. Between 1945 and 1981, the ratio barely changed – reaching 168 per cent of GDP. But then a relentless upwards shift began. Between 1981 and 2009, debt grew by 390 per cent in real terms, far outpacing US economic growth (of 120 per cent). By 2009, the debt ratio reached 381 per cent of GDP.

Most remarkable was that this lasted for so long, in defiance of logic. And a spendthrift public had nothing on policymakers. Gordon Brown declared the end of “boom and bust” and gloried in “growth”, despite expansion being nothing more than the spending of borrowed money. Between 2001-02 and 2009-10, Britain added £5.40 of private and public debt for each £1 of GDP growth. Between 1998 and 2012, real GDP increased by £338bn, while debt soared by £1.1 trillion. No other country got it so wrong, but the same was happening across the West.

The compounding mistake was a belief that globalisation would make everyone richer. The problem was that the West reduced production without corresponding reductions in consumption. At constant 2011 values, US consumer consumption rose by $6.5 trillion (£4.1 trillion) between 1981 and 2011, while government consumption rose by $1.7 trillion. But the combined output of manufacturing, construction, agriculture and the extractive industries grew by $600bn. At less than $200bn in 2011, net services exports did little to bridge the gap. This left domestically-consumed services and debt. Talk of Western economies moving into services was waffle – consumers sold each other greater numbers of hair cuts and fast food, while increasingly depending on imported goods. The debts used to buy them also soared. Between 1981 and 2011, US indebtedness rose from $11 trillion to $54 trillion.

The third trend – the massaging of economic statistics – may serve as explanation for why this happened. In the US, the benchmark inflation measure has been modified by “substitution”, “hedonics” and “geometric weighting” to the point that reported numbers seem six percentage points lower than under the calculation used until the 1980s. US unemployment excludes so many categories (like “discouraged workers”) that it hides higher levels of inactivity. The critical distortion is inflation. It feeds into calculations showing “growth”, when evidence from other benchmarks is that Western economies have stagnated for a decade. Distorted inflation also tells earners that they are getting better off, even when this conflicts with their own perceptions.

But a final development is perhaps most concerning. The modern economy began when agriculture created an energy surplus, liberating people to engage in non-subsistence activities. A larger liberation occurred with the invention of the heat engine – energy delivered by labour could be leveraged by coal, oil and natural gas. A single gallon of petrol delivers work equivalent to 360 to 490 hours of human labour.

The critical equation is the difference between energy extracted and energy consumed in extraction – energy return on energy invested (EROEI). Since the Industrial Revolution, EROEI has been high. Oil discovered in the 1930s provided 100 units of energy for every unit consumed. But EROEI has fallen, as discoveries have become smaller and more costly to extract. The killer factor is the non-linear nature of EROEIs. Once returns ratios fall below 15:1, there is a dramatic “cliff-edge” slump in surplus energy, combined with a sharp escalation in cost. And the global average EROEI may fall to 11:1 by 2020. Energy will be 50 per cent more expensive, in real terms, than today. And this will carry through into the cost of almost everything – including food.

We are nearing the end of a period of 250 years in which growth has been the assumed normal. And, without action, this will have stark implications for the economies of the West.

Dr Tim Morgan is global head of research at Tullett Prebon. Perfect storm can be read in full at www.tullettprebon.com

- See more at: http://www.cityam.com/article/economic-perfect-storm-four-trends-killed-western-growth#sthash.YRjHSDYl.dpuf