Cully and Meleana Judd invited me to dinner at the Outrigger Canoe Club with Richard Heinberg and some of their friends. What a treat.
That’s Richard with his back to the camera. Then, to his left: Cully, Tom Loudat and his wife Nadia, Carol Silva, Ron Richmond and Meleana. I’m missing from the seat in the middle.
I sat on one side of Richard. We all talked energy all evening. Nice people, and great conversation. I loved it.
left to right: Me, Richard Heinberg, Meleana Judd
left to right: Tom Loudat, me, Richard Heinberg, Cully Judd and Ron Richmond.
Earlier, I called Cully and asked him: “Eh Cully, What you going wear?” (i.e. What was the dress code?).
He said, “I’m going with shorts or I’m not going.” I said, “Okay. I going with shorts, too.”
I had just seen Richard at the ASPO conference in Washington, D.C. last week. But we did not get a chance to really talk story then. This was a great opportunity. Mahalo, Cully and Meleana.
From Richard Heinberg’s website:
Richard Heinberg is the author of 10 books including:
The End of Growth: Adapting to our New Economic Reality (June 2011)
Blackout: Coal, Climate, and the Last Energy Crisis (2009)
Peak Everything: Waking Up to the Century of Declines (2007)
The Oil Depletion Protocol: A Plan to Avert Oil Wars, Terrorism and Economic Collapse (2006)
Powerdown: Options and Actions for a Post-Carbon World (2004)
The Party’s Over: Oil, War and the Fate of Industrial Societies (2003)
He is Senior Fellow-in-Residence of the Post Carbon Institute and is widely regarded as one of the world’s foremost Peak Oil educators. He has authored scores of essays and articles that have appeared in such journals as Nature, The Ecologist, The American Prospect, Public Policy Research, Quarterly Review, Z Magazine, Resurgence, The Futurist, European Business Review, Earth Island Journal, Yes!, Pacific Ecologist, and The Sun; and on web sites such as Alternet.org, EnergyBulletin.net, TheOilDrum.com, ProjectCensored.com, and Counterpunch.com.
He has appeared in many film and television documentaries, including Leonardo DiCaprio’s 11th Hour, and is a recipient of the M. King Hubbert Award for Excellence in Energy Education.
This short video narrated by Richard Heinberg explains why we have come to “the end of growth.”
More information about Richard can be found on his website.
“Find three solutions to every problem, and then find one more just in case.”
The time for endless debate is over. We need action.
We know that it is becoming increasingly difficult to increase world oil supplies. There is no point in discussing, to a fine point, when Peak Oil will happen. It is more important to know the consequence of not being able to keep up with demand.
The consequence is rising prices. We have seen that when oil prices exceed $100 per barrel, the world economy starts grinding to a halt. But oil is already at $90+ per barrel, and the world is in a slow growth period. Could the “new normal” be slow or no growth?
How much time do we have? Just today we hear that Israel is considering bombing Iran. And business commentators are now looking beyond Greece to Italy. But Italy is too large for Germany and France to save. If the EU unravels, the consequence for the world economy is not pretty. So how much time do we have? I would say, “Not much.”
We need to look hard and find that extra solution to our problem. We need a solution that strengthens the aloha spirit and is proven technology, low cost, stable and an economic driver. Our solution needs to create no emissions and be large enough to make a real difference.
The answer is geothermal.But our electric utility is operating with one hand tied behind its back. It has a fiduciary duty to its shareholders, which prevents it from finding that one solution that solves all our problems.
We need to untie the utility’s hands.
Read the rest of this series on the 2011 Peak Oil Conference:
I was Hawai‘i County’s representative to the 2011 Association for the Study of Peak Oil conference in Washington, D.C., which just concluded.
This was the fourth time I’ve attended the conference. After my first ASPO conference it hit me: I learned too much! It became my kuleana.
This is the third in a series of posts about information gleaned from this year’s conference. Note that everything I’m writing about is based on numbers, not my opinions. I am relaying information from very credible people who have gone through the peer review process and been vetted.
Energy Return on Energy invested (EROI or EROEI)
In a sentence, the definition of EROI: “The energy it takes to get energy – minus the energy it takes to get food – equals our lifestyle.”
Charles Hall, David Murphy and others, who have done peer-reviewed analyses of the concept of EROI, argue that organisms, organizations and civilizations must generate surplus energy in order to survive. A mother cheetah must be able to chase down rabbits and gazelles, miss a few, feed the kids and still have enough energy to run down more or else the species goes extinct. Ancient civilizations followed this principle.
This is Charley Hall, the father of EROI, on the left.
I was sitting right next to him and asked him how come there are no analyses for “hot” geothermal, like we have in Hawai‘i and Iceland. His answer was that we are a tiny part of the world solution. I guess so – we are only 2 million out of 7 billion people that are so lucky.
If it takes more energy to get the energy (as in some biofuels), then someone needs to explain to regular folks why we would do that. Otherwise, we start thinking about Easter Island.
Can we pay back our debts if the economy cannot grow? It is clear that the economy cannot stand a triple digit oil price. We have been using twice as much oil as we have been finding for more than 20 years now.
And it is becoming more difficult and, consequently, more expensive to develop new sources. It seems reasonable to assume that oil prices will rise and fall with demand. But the prices will tend to keep rising as the population’s demand rises and as old fields naturally decline.
And doesn’t modern economic theory assume continuous growth? But growth stops when oil reaches triple digits per barrel. Are we facing the end of growth? It is prudent that we plan for the worse and hope for the best.
Both Gail Tverberg and Jeff Rubin write blogs about this (both their blogs are always available by clicking in the side bar at right).
Here I am with Gail. I cannot refute her arguments, so I spend all my time figuring out workarounds. That’s why I push geothermal so hard. It’s the bridge that will enables other renewables to cross.
Hawaii Pacific University (HPU) in Honolulu is sponsoring a talk about the end of growth by Richard Heinberg on November 9th. Heinberg is a Senior Fellow-in-Residence at Post Carbon Institute, a nonprofit organization dedicated to “building more resilient, sustainable, and equitable communities.”
This is Richard Heinberg on the left.
This series of posts about my trip to the 2011 Association for the Study of Peak Oil (ASPO) continues. Read Part 4 here.
Robert Hirsch pointed out that what we have is a liquid fuel problem, not an energy problem. Sixty percent of the world oil supply comes from a few giant oilfields. And giant oilfields decline naturally. The problem is that we have been using twice as much oil as we have been finding for 20 to 30 years.
There is some near-term potential: gas to liquids, coal to liquids, heavy oil refining, enhanced oil recovery and energy efficiency. He points out that in the long term we must implement much more electricity use. Robert Hirsch always makes common sense to me. His book The Impending World Energy Mess is well worth reading.
Robert Rapier pointed out that the U.S. uses 23 barrels of oil per person per year, while China uses only two barrels per person. At present oil prices, China’s economy is growing while ours is barely staying above water.
This is a zero sum game – they want to improve their standard of living, and we cannot afford to pay more, so our per barrel use must shrink. It looks to me that the Chinese cannot wait to jump into their cars and drive to McDonalds. I’m thinking, too, that we in Hawai‘i should be trying to implement lower cost energy as a top priority as we move toward renewables. Like geothermal?
Jeff Rubin: Two thirds of our economy is consumer spending. Peak Oil is not about how much oil there is, it’s about how much we can afford to pay for it. To grow the economy, we need cheaper oil. Market clearing prices do not seem to be compatible with economic growth.Transporting goods uses liquid fuels and the longer the distance the more the cost. Debt means borrowing on our future. We have done a lot of that. I wonder, will there be growth so we can pay it back?
There are links to both Jeff Rubin’s and Robert Rapier’s blogs in our sidebar, at right.
From the first ASPO conference that I attended, in Houston in 2007, it was immediately apparent to me that we needed to implement geothermal sooner rather than later.
I also learned a lot on the trip to Iceland that Ro Marth and I took. Iceland had the biggest economic collapse in the history of the world. The banks had been privatized a few years earlier and they just went crazy lending money to anyone without worrying about payback ability.
When the banks could not pay their obligations, the Icelanders let the banks collapse and they are now prosecuting the bankers for fraud. The big story behind all this is that Iceland is pulling themselves out of the hole. And that is exactly what I went to see for myself.
I saw that cheap energy is what saved them. And in Hawaii, we can do the same – with geothermal in the short term and with all the other renewables we have in abundance in the longer term.
Hawaii and Iceland, with a combined population of 2 million people, have the best geothermal resource in the world.
Our Big Island will be over the “hot spot” for the next 500,000 to a million years.
Our two million people, out of the 7 billion people in the world, are so lucky.
More commentary to come….
In the meantime, here are some pictures from Washington, D.C. This is Helen Davis, an energy staff member for Rep. Hirono. I’m so happy to see Hawai‘i’s people represented at the conference.
Occupying the Capitol. There are rows of tents, all neatly organized. More than 50. I understand there is another Occupy encampment, too.
When I was walking toward the Capitol, I saw this monument in a park.
We are using twice as much oil as we have been finding for the last 20-30 years. And we are getting closer to the intersection of increasing world population and a finite resource.
Shale gas – 70 percent of the gas that comes from a gas well is used up in the first year. We do not have close to a 100 year supply. Lucky if we have 25 years’ worth.
The U.S. mainland has a liquid fuel transportation problem. Hawai‘i has both a liquid fuel transportation problem as well as a liquid fuel electricity problem.
The good news
Compared to the rest of the world’s population of 7 billion people, the 2 million people of Iceland and Hawai‘i have the best geothermal resource in the world.
The Big Island will be over the “hot spot” for 500,000 to 1 million years.
Geothermal costs around 10 cents per kWh to produce electricity. Oil, at $100 per barrel, costs more than 20 cents/kWh. Geothermal energy cost will stay stable for 500,000 years while oil will rise to unaffordable levels soon.
Like our ancient people a long time ago, we must make decisions for future generations. Can we continue to wait and hope for the best, or do we force change?
The Board of Agriculture recently held its monthly meeting on Maui, and after the meeting we visited several farms in upcountry Maui. It was really good to see the successful farm operations.
Last week I got a call to meet with a group of young folks at Starbucks. They are very aware of the effects of world population growth running into finite resources. They appealed to me saying they want to help move Hawai‘i off fossil fuels and onto indigenous resources. And they want to move now, not tomorrow!
They told me that their generation has no hope in Hawai‘i. They said they have no hope of ever owning their own homes. Jobs are hard to come by. Even if one graduates from college, what then? They understand the connection of oil prices to recession and expansion. They know that it is the cost of energy that is affecting our economy.
This meeting really hit me hard. I was talking to people who are actually being affected by the consequences of finite resources. Yet they are absolutely determined to help make a better future for future generations. They are about more than just me; they are about all of us. I am so hopeful for the next generation.
Reflecting on what they told me, I thought about Law Professor and current U.S. Senate Candidate Elizabeth Warren. Watch this clip, about which the Washington Monthly says: “First-time candidates don’t usually articulate a progressive economical message quite this well.”
A quote from the clip:
“You built a factory out there? Good for you. But I want to be clear: you moved your goods to market on the roads the rest of us paid for; you hired workers the rest of us paid to educate; you were safe in your factory because of police forces and fire forces that the rest of us paid for. You didn’t have to worry that marauding bands would come and seize everything at your factory, and hire someone to protect against this, because of the work the rest of us did.
“Now look, you built a factory and it turned into something terrific, or a great idea? God bless. Keep a big hunk of it. But part of the underlying social contract is you take a hunk of that and pay forward for the next kid who comes along.”
Some of her points: In the 1970s, a married couple with two kids had one parent in the workforce and saved 11 percent of their income. To get into the middle class, their kids needed to get a high school diploma and to be willing to work hard. That 12 years of education that their children needed, to get into the middle class, was free.
Warren says that the most important thing that happened in the first two-thirds of the 20th century was that women entered the work force.
In the 2000s, a similar married couple with two kids must have two people in the work force – because, she says using numbers adjusted for inflation, median mortgage payments in 2005 are 76 percent higher than they were in 1970. Health insurance – in a healthy family with employee-sponsored health insurance – costs the family 74 percent more. Childcare costs have increased 100 percent, and as compared to the 1970s family a 2000s family has the expense of a second car because of that second person in the workforce, and because of that second income their tax rate is up by 25 percent.
In comparable dollars, the 2005 family is actually spending much less on clothes, food, appliances and cars than the 1970s family did; it’s the non-flexible, big ticket and important expenses that have increased so dramatically and that require that second income.
So a comparable married couple with two kids in 2005 has no savings (compared to the 1970s couple, who saved 11 percent of their earnings), and 15 percent of their income is in credit card debt as they try to keep up.
To launch their kids into the middle class requires 16 years of schooling, and the 2005 family has to pay for the first two years (preschool) and the last four years (college) themselves.
So much happened in just one generation, 30 years, and we didn’t even notice it. And change is coming even quicker today. What’s happening in the world now makes me think that Elizabeth Warren’s 30 years is being compressed into 10 years or less now. We can see it all around us.
We are already in the middle of it, and many folks are so busy running on the treadmill that they don’t notice it. We do not have the time luxury of acting on wrong information.
That is why I am encouraging folks in important decision-making positions to attend the Association for the Study of Peak Oil conference. Its theme is Truth in Energy.
I am so happy that young people see it and want to do something about it.
Jeff Rubin, former Chief Economist for CIBC Bank of Canada, says it’s not about oil supply, but it is more about oil we can afford to burn. I like him because his reasoning makes common sense. If we cannot afford the renewable energy solution, what is the point?
Mark Glick was just appointed head of the Energy Division of the Department of Business, Economic Development and Tourism. Back when I was supporting the Thirty-Meter Telescope, Mark was President of the Sierra Club, and I had an issue with them.
I pointed out that the Sierra Club is anti-Hawaiian in carrying out its policies. I made clear that I was not against the people who belonged to the Sierra Club – I was a member, and the folks were my friends. I just called its policy anti-Hawaiian.
By all indications, Mark is very well-qualified for his new position. But he needs to keep in mind that when choosing renewable alternatives, people have to be able to afford it. The Energy Department’s policies will have a huge effect on Hawai‘i’s economy. Some people, like me, believe it will have the largest effect.
It’s the folks on the lowest rungs of the economic ladder that get their lights turned off first. Too often, they will be Hawaiians.
Energy policy must balance distributed generation, so we do not end up with the “haves” leaving the grid, and the “have nots” and small businesses being left to pay for the grid.
If we use proven-technology, indigenous, low-cost energy – such as geothermal – we will become more competitive with the rest of the world. This will stimulate economic activity.
Hawaii is blessed with abundant natural energy resources. We must maximize our resources. But we also need to prioritize wisely.
Choosing low-cost energy will benefit everyone; not only the rubbah slippah folks.
I just gave a speech to the toughest audience I’ve faced in a long time.
Several weeks ago, Ted Peck, President of Ku‘oko‘a, asked if I was willing to speak to a student group for no more than 10 minutes about Science, Technology, Engineering and Math. Of course, I accepted.
On Friday evening, I flew to Honolulu from the Big Island, picked up Ted, who was flying in from Chicago, and we arrived at Fern Elementary School just in time for the beginning of the program.
I heard that the Blue Planet Foundation had a display up, but they were not going to speak. There were several University of Hawai‘i instructors there, wearing matching t-shirts. I asked, “You folks speaking?” but they said no.
I asked who else was speaking, and the woman replied, “Just you.” I started to sweat.
She made introductions and then introduced Ted, who took a few minutes to introduce me as the Chairman of Ku‘oko‘a. Then he said, “Please welcome Richard Ha.”
After walking in, I took the microphone and looked out at the audience. There were maybe 70 students, from kindergarten to 5th grade, and a smattering of parents. I sweated some more.
I had to think fast. What could I say to these youngsters that they could understand and take away? Did they even understand what Science, Technology, Engineering and Math are? Surely they had no idea what Ku‘oko‘a was, let alone “Mr. Chairman.”
I decided to tell them what my Pop told me when I was their age. I told them about impossible odds, and pointed in the air and said, “Not, no can. CAN!” I looked out at the kids and could see in their faces that they were listening.
I said, “Get thousand reasons why ‘No can.’ I’m just look for the one reason why ‘CAN!!’” They were with me.
Then I told them: “For every problem, find three answers. Then think of one more, just in case.”
I said that if some of them felt they were not as smart as some of the others, to remember: “If someone is twice as smart as you, but you work four times as hard, then you can become twice as smart.”
“You can make up for everything by hard work.” I was on a roll.
I asked them what they would do if an earthquake came and everybody was falling down. They didn’t know. I told them my Pop told me to jump in the air and do a half turn. If you are not touching the ground when it shakes, you won’t fall down. And after two jumps you would have spun all the way around and seen everything.
Yesterday I gave a talk at the Sheraton Outrigger in Keauhou. The talk was for the Water Works Association of Hawaii, which is the umbrella association of all of Hawai‘i’s water departments.
I talked about the Hawaiian Electric Company (HECO) operating with one hand tied behind its back. HECO has a fiduciary duty to its shareholders and so it cannot do all the things it might want to do to help Hawai‘i’s people. For instance, it would have a difficult time lowering Hawai‘i’s electricity rates – by closing its oil-fired plants and bringing on significant amounts of geothermal – without hurting its shareholders’ stock price.
HECO is under much pressure lately. Ku‘oko‘a wants to untie HECO’s hand so it can be the utility all its people want it to be. We don’t want to take HECO over; we want to empower HECO for the benefit of Hawai‘i’s people.
The main point I tried to make in my talk was that time is getting short. And that there is more than enough evidence to show that oil prices will rise in the future. It is not about whether or not one particular theory is right or wrong. The evidence we see all around us is compelling enough.
The reason I know about this is that I have attended three Peak Oil Conferences, and this subject has been on my radar for more than five years now.
We know that the peak of oil discovery was in the 1960s. For the last 20 years, we have been using twice as much oil as we have been finding.
We also know that all oil fields decline eventually. In fact, the natural decline rate of all the oil fields put together requires us to find a Saudi Arabia every two to three years. Clearly we have not been doing this.
Oil exporting countries will use more and more of their own oil. This means less for the rest of us. They must do this, in order to keep their people happy, or the dictators will get thrown out of office.
China and India use much less oil per person than we do, yet their economies keep on growing. The Honolulu Star-Advertiser points out that our electricity rates are approaching the high point of 2008. Our people are suffering, and yet China and India can pay this oil price while their economies keep growing.
And we have not even passed the peak of oil supply. Trying to be safe by doing nothing is no longer safe. We need to think different.
