Complacency or a manipulated trust in the system

Nations as a rule do not react well to the arrival of a crisis. One need look no further than at the amount of funds that were initially designated to protect the United States following the attacks of 9/11. Recent reports suggest that much of that money was not spent in the most effective manner. Which leads to the concern as to the likely Governmental response as the gas price rises to a point where the public will demand action.

We were sitting, discussing the issue this afternoon, while waiting for a plane that had been delayed. "I have no doubt that someone will come up with a technical solution," said one of the team. This is from someone who has watched as it has taken nigh on twenty years in two separate cases for technology to move from lab experiment in to broad field use. He could not be convinced that as soon as the price of gas became high enough that a crisis was evident that some magical solution would come, either directly from the Government or through some crash program that will, in short order, provide a solution and allow us to continue with relatively little disturbance to his life.

At first you wonder how, with the rising price of fuel, and the comments that I have been heard to mutter at frequent intervals, how he could have such an opinion. But then it is also easy to see why he, and the majority of the American and world population do not see it as that imminent a problem that they should be concerned about it.

Consider this past week the article in Time Magazine on the current price of oil. To quote
"At some point in the next decade or so – estimates range from 15 to 25 years – the worlds oil production will peak. Yet demand for oil will continue to rise, increasing 50% over the next 50 years."
The article conveys the sense that what we are seeing is not really anything to worry about because there is a lot of, albeit more expensive, oil still out there. What it completely seems to miss is the convergence of supply and demand, and the growing declines in production in country after country, so that new developments are not going to be able to maintain even a constant supply. And as the Energy Bulletin has reported the value of some of the new finds in the Caspian Sea has also been called into question. And so this peak oil condition could be on us at any time from the late fall of this year. Increasingly experts are saying that it will clearly happen in much less than fifteen years, rather than collectively agreeing that it will not happen until beyond that time.

The article implies that if we are just patient, then prices will fall again. Well there is a short term price drop at the moment since this is the point where the seasonal demand is lowest, but it is really difficult to see any rational reason for assuming that this will last very long into the summer, and that is without any of the incidents that regularly bedevil the stability of supply.

We are in short, as complacent as we were in the early part of 2001. It is doubtful that there has been much thought given to the technical steps that might be needed to speed up the creation of the needed resource. So one should suppose that we will see the same sort of response in terms of spending on Energy that we have seen on Homeland Security. We can only hope that the majority of it may be spent to better end result.

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If the Reps retain power, rest assured that it will be something that has always worked in the past. I imagine even more OilCo subsidies in spite of all-time profits, the 55mph limit making a comeback, tax incentives for solar, etc. I do not think there will be a separation between the Reps and corporate interests. It has simply been too profitable for both.

If the Dems get power, then I do look for more favorable incentives to alternate energy, public transport, and less to drilling for more oil. But again, outside of a tiny fraction of the legislative body, PO will still be "off the map". If the Dems get power, then corporate money will cozy after them, which is why many of them want it back.

I see few, if any, legislators who have a future vision including sustainability. I do not see profit in this direction UNTIL fuel becomes crippling to the current economic models. Then there will be a "piling on" of money into alternate energy.

With the "piling on", we can expect corporate corruption in the way of AE price gouging, bad or counter intuitive federal regulations from lobbyist groups with respect to AE, and a huge increase in "pork projects" as the Feds attempt to allocate money to solve this "new problem".

That being said, this would be preferable to the current ostrich policy.

However, with the MSM cahooting with the Reps, it will likely take a major crises for the people to turn out enough voters to overthrow the current regime.

While I can't believe I am saying this, I am hoping for a crisis, the sooner the better.

I see a chance for a Jimmy Carter clone, if current trends continue. When you think about it, we could be entering an echo of the late seventies ... coming off a "sticky war" with a (possibly) shaky economy.

... but around here (southern California) the economy seems not to care about energy prices ... so far.

As J.H. Kunstler writes in the introduction to The Long Emergency:

Carl Jung, one of the fathers of psychology, famously remarked that "people cannot stand too much reality."

Most of the public (and politicians too) cannot deal with Peak Oil because it would force them to re-examine nearly all of the underlying assumptions of modern life. So they ignore it and hope it will go away.

It will take physical shortages. Next year...

Well, I said it weeks ago - IMHO, it will require a crisis.

Then it will require a combination of three things in a single person - a vision, leadership, and some moral scruples. Gods, but who knows where this type of person can be found in state or federal government.

Otherwise, it looks like Kunstler will turn out right more or less. I have been talking about this for well over a decade - the response varies but is usually anger or ridicule or feigned concern or laughter - anything but what one might hope for.

Even within this blog, I have read responses whose primary focus is on "what to do with your stock portfolio" with respect to Peak Oil. Even those that know can be easily divided into two groups - those whoknow and have thought this through and those who know but do not get the full ramifications.

If you follow this through and do the reading and research, you wind up at, which scares the beejeezus out of all but the survivalists.

Yet here we sit, and while we blog, the Atlantic conveyor current has been proven to be 80% reduced, stock analysts are warning about an impending "long term retrenchment", commodities are foaming at the mouth anticipating a bull run due to inflation, we are at war due to oil and the housing market is starting to look like a house of cards here and in most of europe. Oh yes - oil is also somewhere near peaking...

Why did I wish for a crisis?

I should be praying we get only one at a time!

An informal survey.

Natural Gas for June 2005 delivery is currently $6.62 on the NyMex, while oil is 50.96 and unleaded gas is 1.49 as I write. These are the wholesale prices, of course. What isn't quoted is Kilowatt Hours because its wholesale cost can vary considerably from state to state (and even within states).

What I'd like to know is what's being paid by those here for unleaded regular, natural gas, KW hour (x for x KW, then x for x additional KW, and so forth), and any other energy source used, like heating oil or cordwood. Also, please give your location.

Here in Yachats, Oregon, I pay 2.55 for gas; I don't use natural gas; $120 for a cord of Alder (very high BTU content); and .08530 first 300 KW, .058 for next 725, avg. .0658/KW.

One point of this exercise is to reveal those energy prices that we don't see on a daily basis like gas prices at filling stations. The one "hidden" price most important to me is that of Natural Gas, as its declining extraction and rising price is why I built an all electric house.

Thanks in advance for your participation. I will collate the results and make them known.

Are you sure those kWh rates aren't additive? Down here we get charged more, the more we use, and not less.

In Orange County California, with SCE, the electricity bill is split into a vast array of strange charges and categories of kWh ... "delivery" gets split into two rates and "generation" gets split four. Wow, eight combinations of rates for different "watts" -and this is for someone who is all below baseline, and doesn't get hit with the higher rates.

Looking at it, I think my cheapest kWh is 8 cents and my most expensive is kWh 18 cents.

But if I just do the gross math, and divide a $15.02 bill (total due) by 124 kwh (total used), my effective cost is 12 cents per kWh, taxes included.

Natural gas is 96 cents per therm.

Regular asoline is pretty much running $2.40 to $2.50 ... but you can find places to pay more.

My rates as you noticed don't encourage conservation. There are seperate business rates that are less complicated than what you describe.

My rates can be seen here,

And your 96 cents per therm is @ 9.60 MCF, or almost 3 dollars higher than the NYMEX--ouch!

Here's a similar page from SCE. There are two mind-boggling things, in my opinion. The first is the complexity (note that we get charged for both the yellow and green sections) and the second is that their demonstration customer is paying $238.59 a month for electricity!

I think a lot of people just live on a treadmill, earning good money, and then paying it all out:

As most of the electricity in Texas is from petroleum, we have what we call a "fuel surcharge". Now, while my electricity has remained constant in price for the most part, my "fuel adjustment" is now higher than my actual electrical billing.

You can get at least one leg off the treadmill by going partially solar. Water heater is the easiest. Then you can switch appliances that can go AC/DC. Those are usually the biggest loads. But the A/C - the only way out is to move somewhere more temperate or go geothermal heat pump...

But odo is right. There are a LOT of people who are getting strapped right now with fuel, electricity and adjustable mortgages all rising simultaneously.