The paradox of living in Hawaii has long been that the native people give and give, and the economic system takes and takes.

Finally, we have a solution—one that is good for everyone and in multiple ways. I’m talking about geothermal.

We are using up our “cheap oil” every day now, and without cheap oil, our economy and world economies will not grow. Very soon, we will only have expensive oil, and when costs are too high we go into recession.

The growth of the world’s GDP will be less than it was yesterday, and maybe for as long as we can imagine. Neoclassical economists assume constant growth, but this is impossible when world oil supplies are decreasing as they are now.

This is why I’m such an advocate for using geothermal for energy on the Big Island. Its cost will not go up; it will stay steady even as world oil prices increase. As that happens, we will become relatively more competitive to the rest of the world. As the world’s standard of living declines, we will stay the same.

This means that our standard of living will actually increase, relative to the rest of the world.

Geothermal’s energy return on investment (EROI) is high. EROI is key:

…EROI is similar to its economic analog, which is return on investment (ROI). The idea is that you have a cost of getting a resource and hopefully you input that cost and you get some oil out. EROI is simply the energy produced from an energy extraction process divided by the energy you put in. We add up the cost of building the rig, the diesel fuel used on a rig, and what you get is a ratio of energy out divided by energy in. That number is essentially a measure of quality. It’s an efficiency calculation, but you can understand it as a measure of extraction and how difficult that extraction process is. Historically, if you look back at East Texas and see a lot of the big oil fields in the United States, the EROI was very high. Today, it’s obviously a much more complicated industry. For example, deepwater platforms cost billions of dollars and the wells are much deeper. The energy input has grown a lot. In general, EROI is this measure of extraction quality and how that changes over time…. Read more at The Oil Drum