Is There A Painless Way To Fill The Oil Supply Gap?

This is a guest post by Dr Michael R. Smith of Energyfiles Ltd. Dr Smith gave an excellent presentation to The Oil Depletion Conference hosted by The Energy Institute in London last year and this post is an abridged version of what he had to say. If you like the post, then please use the "tip jars" or send the link to a friend.

I have been writing on oil supply issues since 1995, in particular the imminent supply gap and the looming new energy era; forecasting a peak in global supply arriving between 2010 and 2020 depending on demand growth. The Energyfiles report “Oil & Gas – Global Ten-Year Projection” (now in its 2007 edition) was published in response to queries about the data used to arrive at these conclusions.

Nonetheless, despite new evidence in the form of higher than expected demand, capacity squeezes and price rises, there remains a view amongst some geologists and economists that the peak is many years away and even that technology, new energy sources, and new efficiencies will make it irrelevant. Although I believe such views are driven by wishful thinking, I do not want to digress on this subject here. Instead I want to address energy supplies after peak; the size of the so-called supply gap and how it might - or might not - be filled by alternative transport fuels and by efficiencies.

The supply gap depends on demand as well as supply. In the past demand has been erratic but yearly demand growth of 1.8%, based on what has happened over the last 25 years, seems to ensure economic stability. This business-as-usual (BAU) growth is depicted, along with a detailed field-based production forecast of ‘usual’ oil, in Figure 1.

Figure 1. Forecast of conventional oil production plus NGLs (click to enlarge).

A small supply surplus up to 2013 is followed by a deficit to the end of the period plotted. The surplus will partly be compensated by shut-in capacity, especially heavier oil in Saudi Arabia, and partly by surges in demand (mostly in Asia) as prices briefly fall.

Filling the gap with alternative liquid fuels

The deficit in 2020 will match all of the current production from the Middle East but a model is needed for oils that do not fall into the ‘usual’ category. ‘Time Magazine’ has said that Canada’s Athabasca oil sand Belt “…could satisfy the world’s demand for petroleum for the next century”. The oil sands may be huge (or they may be a huge environmental problem), but they will not go close to filling the gap on their own, even if problems of energy return on investment (EROI) and the need for gas and water supplies to effectively develop them are overcome.

Venezuela’s La Faja extra-heavy oil region has also been called a “saviour”; however it will hardly impact on global supply after peak. There are other such areas. The World Energy Council has documented 54 geological basins that contain oil sands. But, considering the time it has taken to develop Canada’s and Venezuela’s resources substantial short term output from these is unlikely.

Oil shales have been exploited for hundreds of years but rarely commercially due to their poor EROI. Large operations in China and Estonia shrunk in competition with cheaper fuels but perhaps new technology and higher prices will turn this around. In fact ‘Rocky Mountain News’ portrayed Shell’s in situ method of conversion and extraction as “…simplicity itself in concept but exquisitely ingenious in execution”. Exquisite it may be but the time needed to develop significant volumes of oil from shales must be measured in decades.

Gas-to-liquids (GTL) has been “ready to arrive” for at least a decade and it will still be ready to arrive a decade from now. In a market where stranded gas is in demand for LNG, GTL can rarely compete. Conversely coal-to-liquids (CTL) technology has massive potential. Up to now CTL has only been used in non-commercial operations, notably in Hitler’s Germany and apartheid South Africa. China, with its huge coal resources, is trying to kick-start a new CTL industry and substantial growth is forecast. But again the amount of growth possible within the next two decades, will hardly impact the gap.

Figure 2. Forecast of all liquids production (click to enlarge).

Finally there are the biofuels. Growth of these is coming from a low level and biodesel and bioethanol, whose energy density is less than 70% of crude oil, eat into valuable agricultural land. Even with massive investment they will be incapable of filling the gap. Conversely cellulosic ethanol (BTL) is the holy grail of the biofuels industry; but, still in the pilot plant stage, real year-on-year growth is not likely for at least 20 years.

The gap has thus been pushed to 2015 as shown in Figure 2, with the deficit in 2020, assuming BAU demand, still equalling current production from Saudi Arabia and the USA combined. What’s more, with surpluses to 2014 the drive to save oil will remain with the environmentalists, whilst surplus oil, should OPEC allow it on the market, will be rapidly mopped up by the growing Chinese and Indian economies.

There may be room for additional growth in some liquids sources should massive investment programs be instigated before the peak and I have not incorporated significant hydrogen fuels made from gas, nuclear power or renewables. Furthermore the analysis contradicts recent projections by Cambridge Energy Research Associates (CERA) who foresee ‘usual’ oil growth until 2030 but fail to explain realistically where the oil will come from. Nonetheless mine is a realistic model for a real world which moves at a rapid pace in a free market.

Closing the gap with efficiencies

Once high prices recur there will be every incentive to develop efficiencies, some of which may be realised without pain - unlike conservation, which will requires radical, unwanted and uncomfortable changes to life style.

For instance it may be possible to reduce plastics use by half in 20 years using natural alternatives and less waste. In the USA automobile performance could be significantly increased, perhaps approaching European levels by 2025 which also has room for improvement on current trends.

Figure 3. Forecast of supply gap with demand adjusted for efficiency measures (click to enlarge).

There are few options to save jet fuel with the current airplane mix although routing modifications may offer some savings. Conversely continued introduction of electrified train, metro and tram systems should offer significant cutbacks in oil use throughout the transport industry. Finally full conversion of all the remaining oil-powered heat and power sources to gas, coal, and renewables could lead to substantial reductions in demand.

Such efficiencies are approximations and involve increased use of natural gas, which in Europe and North America will be difficult, and coal, which will be environmentally damaging. But the gap, now pushed to 2016 as shown in Figure 3, may be reduced to the approximate current output of Saudi Arabia and Kuwait by 2020.

The only realistic option

Thus the answer to the question is no; there is no painless way to fill the gap. Of course it will be filled; partly from traditional sources; partly from new alternatives; partly from simple efficiencies; but a large portion will have to be filled by demand destruction. In the real world demand destruction means poverty and conflict. We should be working towards reducing vulnerability to such destruction.

And if we cannot do it globally we should do it locally; at least to gain a competitive edge. Companies and governments must take energy risks with capital intensive projects, innovative energy sources, new modes of transport and through cutting consumption with taxes and rationing systems. Growth and decline will in truth be erratic as chaotic price movements drive demand up and down. But liquid energy demand will want to grow faster than supply. The global population has reached an unsustainable energy demand level to support the lifestyles we desire. Conservation will be a necessity but it will be painful.

Oil & Gas 2007: Global Ten-Year Projection provides a quantitative survey of every country and region in the world – forecasting world oil and gas production, consumption and trade; onshore and offshore. It is an essential information tool for decision-makers in oil companies, in the contracting and supply industries, and in financial institutions and government departments. For more information visit

I remember when everybody peaked at once!

It was 1979.

Remember, we are only one cubic mile from freedom.

"And if we cannot do it globally we should do it locally; at least to gain a competitive edge."

That was, is, and always will be the reason to do it.
Remember, we are only one cubic mile from freedom.
RC is a great website!!

I like the second last page of this presentation

with the firefighters standing in front of the burning house which is beyond saving and the caption "Plan B". Plan B: take the pain of demand destruction.

Demand destruction perhaps won't be that horrible. New cars are being sold which are smaller and lighter. I live in a big city and most people driving to and from work are the only passenger in their car. There is no reason why a 1000kg of car is needed to transport an 80kg person on a regular basis.

Ace >Demand destruction perhaps won't be that horrible.
The demand destruction already happening now in Zimbabwe and some other parts of Africa is certainly horrible. We in the rich world are insulated from horror.

The demand destruction already happening now in Zimbabwe

Is due to horrendous mismanagement by Mugabe, not the price of oil. Zimbabwe has been suffering like this since oil prices were $20/bbl in 2000, at which time it was in the middle of a ruinous war and just about to embark on an even more ruinous program of farm appropriations.

While all looks yellow to the jaundiced eye, not every problem in the world is due to peak oil, and one only looks silly asserting so. To learn more about the causes of Zimbabwe's problems, I'd suggest reading the brief overview at the CIA World Fact Book (link), or the slightly longer treatment on Wikipedia's Economy of Zimbabwe page (link).

I would feel a whole lot better about demand destruction if our economy were not debt based. I expect we will have massive defaults on debts with declining oil production. Either there will be some type of govenmental guarantee, and we will have massive inflation, or there will be no guarantee, and the debt-based system will collapse.

There is also the issue of debt going forward. What lender will be willing to provide a 20 or 30 year loan (for mortgages or for commercial purposes) once it is known that oil and natural gas are expected to decline year-after-year, in the future?

Historically speaking, I think the odds favoring massive inflation are about nine to one.

What effect would an across-the-board carbon tax have? Something that would push the price of all oil, coal, and natural gas. The tax could be "pain neutral" with corresponding decreases in other taxes... social security tax could go to zero and earned income tax credit could be significantly increased, for example.

Imported goods could be taxed according to their carbon liberation, but with a tax credit for any carbon taxes payed in the producing country. This would force major importing countries to match (or exceed) the USA carbon tax, as anything less would just be giving extra money to the USA government instead of their own.

As it stands now, the "price destruction" is going to mean huge profits to foreign nations as the USA pays more and more for fuel. A federal carbon tax means that the citizens of this country can at least gain huge tax revenue out of the gap instead of giving it to foreign nations.

Two problems.

One: Pensioners and those on a low/fixed income. Especially if they don’t already pay taxes.

What are you planning to do? Give them direct handouts? If you give them handouts equal to their carbon tax expenditure then expect them to continue to behave as before as this will be the cost neutral option to them.
Plus in a system like carbon taxes there will always be winners and losers. Poor folk that need to commute to work & can’t afford a new car will be hit much harder than Joe Stockbroker who takes the (electric) train to work in the morning.

Also bear in mind, to conserve on essentials like home heating & cooking you need dollars available for capital investment. Poor people and small income pensioners don’t have these funds available.

The second problem is that, ultimately, politicians will control the system. How much do you trust politicians. I personally trust them to ONLY act in the interests of their personal interest groups, ie. NOT me.

All you’ll end up doing is creating a massive bunfight over who gets what rebates/handouts/exemptions etc. And as usual it’ll be those minority groups that shout the loudest who’ll get them most.

No. New taxes are not the way forward. Why is it that when presented with a problem most socialists & environmentalists solution always seems to be “If it moves Tax It”?

Like many things (communism amongst them) it may seem like a good idea in theory, but in practice when faced with Human Nature, it will fail dismally to have any real effect.

Gentlemen, what we need here is some solutions, not more taxes that will benefit the politically connected.

That's pretty much all the standard rhetoric. Don't think of it as "new" taxes. Instead, it is "different" taxes. Why is this country punishing work with hefty payroll taxes? Why not punish pollution instead?

>>> One: Pensioners and those on a low/fixed income. Especially if they don’t already pay taxes. <<<

I already stated that social security taxes could be reduced/eliminated and that the earned income tax credit could be increased. Sorry that I forgot to mention that cost-of-living adjustments could be adjusted as well. The retired people--as a group--ignored the problem when it reared its head in the 1970's. They passed the problem to the young people; perhaps it is fair to pass the costs back to the old people.

As a fundamental concept, I think it is ridiculous to tax wages. Why are we punishing people for working? Contrast that with taxing people for polluting.

The energy waste I see is systemic. Only a systemic solution will curb the waste. You need to hit each and every person and each and every business for each and every action taken. You cannot micro-manage your way to efficiency.

Dismissing my arguments with some vauge handwaving sying that they’re “standard rhetoric” simply won’t stand up to public debate.

As usual you’re simply assuming that this “solution” can be imposed on people. This demonstrates a worrying lack of understanding of politics.

For the public to even remotely support this it will have to be demonstrated to be revenue neutral, and cost neutral to most people. Given that the stated aim is reduce consumption by its very nature it will penalise consumption. Most voters won’t accept this. Most voters are also deeply conservative when it comes to new ideas. They’re far too used to getting fleeced by the politicos. Most would not wish to give up a known evil (payroll taxes) in favour of something that is an unknown quantity. Plus most politicans are currently trying to sell this “idea” as an additional tax. They say them may reduce payroll tax, but no one is proposing that it, and its collection mechanisms, be abolished completely.

This simple fact leads most folk to simply assume that it is a massive revenue generation scheme for governments trying to cover pension deficits, medicare, etc etc

Second, you tend to forget the law of unintended consequences.

When people earn money and have payroll taxes deducted from them the government can take it as a given that people will want to strive to earn more and better their lot. Thus the government have a stable tax base.

If the govenments revenues are dependant on fossil fuel consumption, what happens if people cotton onto the fact that their tax bill can be massively reduced by increasing efficiency. You might find that for ideological reasons you see a huge drop in consumption coupled with a massive drop in government revenues. The government would then be forced to bring back payroll tax to make up the shortfall. This would likely be highly unpopular, especially with people who had committed to large capital expenditure programmes to increase their personal efficiency.

Secondly, in the UK a great many pensioners feel that they cannot afford basic heating due to the cost of gas. A great many actually CAN afford the heating, but in confusion (and a misplaced sense of saving money) they do not adequately heat their homes. Further a great many pensioners did not take the government’s offer of extra fuel benefits, as they did not want to appear to be taking from the state. With mentality like that further increases in the cost of heating will be psychologically devastating for many old people. And this is not just some abject theory. It is known fact that in the UK higher gas costs and cold winters DO increase pensioner cold related deaths.

Plus the ultimate problem lies with the way this scheme will be brought in. Anything designed and brought to fruition by a cross party political system is doomed to fail due to bartering, negotiating etc.

And then there’s the fact that the 3rd world simply won’t wear it either. Much like Koyto they’ve pointed out that they’re entitled a free pass due to historical advantage by 1st world countries.
Any attempt to impose at the border carbon taxes would in all likelihood lead to trading blocs and bilateral trade between countries not wishing to participate. The Chinese will quite happily strike bilateral deals not to impose port of entry carbon costs with anyone happy to listen. You run the risk of creating two tier world economy.

On top of this it is unlikely that you’ll ever get the whole world to agree to such a carbon tax, so it will end up being impossible (and possibly illegal if not ratified by the WTO) to impose taxes at port of entry based on CO2 emissions.

I prefer a direct handout. Much simpler. Tax all fossil fuel production/importation at a high level, and give out the tax to taxpayers as a standardized refundable tax credit. Yes, it's revenue and cost neutral - that's the prerequisite to get the ball rolling. It's also a significantly progressive tax if you consider that the rich use more energy. But it's the only way that people are going to be MOTIVATED to use less energy. We can either wait for this decision to be made for us (supply/demand or geopolitical panic to raise the price for us, and oil companies to get richer than most countries), or we can do it ourselves in preparation, and do it perdictably, slowly, steadily. With a required handout of all revenue at the end of the year back to taxpayers.

The way it works is thusly: The fact that it's revenue neutral doesn't mean it can't affect behavior. It just means that the average person doesn't see it as so much of an attack on their lifestyle. It presents them with a choice - do you want to have the newfound ability to put your kids through college, go to a fancy restaurant, build that new addition, buy a house, etc, or do you want to stay away from the filthy Bus People(and all those other choices) by using a car for all transportation? That's the decision-making process that's affected. People are handed money, and presented with a selection of choices - the fossil fuel using choice is simply priced with a bit more of its externalities(roads, police, planning, global warming, energy wars) included. People are forced to look at whether perhaps moving closer to town, insulating their house, chucking the Suburban, or installing solar panels might be a good idea. People are motivated to save money for themselves - and we give them the money to do it. Such a tax is the only acceptable way I've seen of creating a system of rational actors who are inherently lower energy in their thinking, and who aren't angry/resentful/sad about this fact.

We spend a significant amount in order that people can continue gasoline-based personal transport compared to what people actually spend on gasoline. This would merely present people with the realities of that decision on a personal level. 4 day road trip versus 7 days on a cruise ship... which is it gonna be? Right now, one of them uses more fuel per capita, and costs much less.


You're arguing that we can't increase energy prices artificially because old people will be confused and refuse to heat their houses? I believe that the phrase I'm looking for is the skin condition on the tail wagging the entire dog. It's a bit ridiculous to base the world's energy and environmental policies on the actions of people who are mentally unfit to care for themselves.

Home heating can be vastly reduced through additional insulation - which taxing those who continue to use outdoor patio heaters can pay for.

You're arguing that we can't increase energy prices artificially because old people will be confused and refuse to heat their houses? I believe that the phrase I'm looking for is the skin condition on the tail wagging the entire dog. It's a bit ridiculous to base the world's energy and environmental policies on the actions of people who are mentally unfit to care for themselves.

You misunderestimate the effect of the tabloid press.

And besides do you really think that people will vote to increase the cost of heating and lighting their homes?

Turkeys do not, as a general rule, vote for christmas.

>>> Do you really think that people will vote to increase the cost of heating and lighting their homes? <<<

Actually, yes! The vote isn't quite that simple. It's more like: Increase the cost of heating and lighting your home but also get a check for $2000 for each person in the house as a free gift from the government. You get the $2000 rebate each year. I suspect that most people think they use "less than average" amounts of energy; therefore, assuming the rebate makes the tax revenue neutral, most people could be convinced that they will get a rebate larger than their increased energy costs.

Many people were excited about the government enacting a windfall-profits tax on the oil industry. Taxing fuel could be sold as having a similar effect.

Do you really think that people will vote to increase the cost of heating and lighting their homes?

Actually, yes! The vote isn't quite that simple. It's more like: Increase the cost of heating and lighting your home but also get a check for $2000 for each person in the house as a free gift from the government. You get the $2000 rebate each year. I suspect that most people think they use "less than average" amounts of energy; therefore, assuming the rebate makes the tax revenue neutral, most people could be convinced that they will get a rebate larger than their increased energy costs.

To the extent that pensioners experience an increase in the cost of living, their incomes are hedged by the increase in pensions eg Social Security, which are indexed to CPI. This would also be true of most others on state benefits, which are mostly indexed to CPI.

So the only gap is for those whom energy is an above-CPI weighting slice of their total expenditure.

These would not, by any means, be only (or mostly) pensioners. Pensioners drive less than the average, and on balance probably have smaller homes. They consume fewer goods and services with a high carbon content.

The UK government already gives a heating grant to poor pensioners and others in cold winters. It wouldn't be impossible for the US government to do the same. Similarly countries set minimum standards of housing insulation, and have loan programmes to support those who need to upgrade to meet them.

'tax' is one way to do this. Another is tradeable permits. We might grandfather existing polluters, giving them permits, or we might use the revenues from selling those permits to reduce other taxes.

The real question is how much does one value the welfare of future generations? If we don't feel we have an obligation to do something for those generations, then we could simply say global warming is a problem for them.

Since C02 lasts in the atmosphere for 100 years or more, I think this is a difficult argument to make, but we can make it.


You are mis-informed about pensioners, at least in the UK. As a group,
they encounter far higher inflation than the CPI weighted average. This is
because a higher proportion of their total income goes on food,
heating and local council taxes than the general population. These items
have been rising sharply, and are offset in the CPI by discressionary items
like electronic gizmos, which have negative inflation.

They also tend to live in older, poorly maintained, poorly insulated and
inefficiently heated houses, often larger than they need personally, because
they do not down-size after their family grow up. This is true of my
parents, even though they are well educated and not short of money. They
do not like change, or what they see as long term investment.

The Labour government had a 'fuel poverty' programme in 1997, and
was one of the few targets they looked likely to meet, due largely to hand-outs to the poor. The energy price rises of the last 3 years has largely
undone this good work, and we once again face the prospect of large numbers of old people dying of hyperthermia, (global warming not
withstanding) or heat exhaustion (courtesy of global warming).

Leaving these people to rigours of the open market for their heat is an
option, but it is not one I would vote for. They will be the 'demand
destruction' element, at least in the UK market.

If they have a larger house than they need, and they own it, then the problem is their housing equity is illiquid.

This is not a trivial point. Vancouver for example allows retired homeowners to charge their property taxes against their estate. *they* don't need to move, whilst they live.

Property is a major fraction of retired person's assets. We just haven't constructed easy ways of unlocking that.

Over to the RPI. I haven't seen any real figures, but I suspect the problem in the UK is limited to those who are relying primarily or wholly on the state for their pensions. The old drive less, or at least drive smaller cars.

(I agree the state of the UK housing stock is a national scandal-- but that can be fixed).

As to global warming killing old people, I have first hand evidence (next door neighbour). But very, very few people in the UK have residential air conditioning: it's not going to be carbon taxes which makes their situation worse.

Doing nothing about global warming will make their children and grandchildren's lives much worse, however.

The UK has the lowest replacement ratio (state pension to average wage) in the western world: thank you Margaret Thatcher and Peter Liddle for that fiscal sleight of hand. So the problem of old age poverty in the UK is about *that* rather than the price of any one commodity per se.

You will note the Daily Mail, in all its vitriol, doesn't mention that point.

The problem is not so large that it cannot be fixed. Nor is it rational, nor economically efficient, to fail to do something about carbon emissions because one group in society will suffer disproportionately.

The increase in energy costs, a 'tax' due to market forces, which has happened to date, is larger than the proposed carbon taxes.

Oh, they own a UK house but somehow they are still poor and claim that they can't afford their heating bills? My heart bleeds for them.


Most people reading this thread probably have no idea just how expensive UK house prices have become and just how much UK houses have gone up in value over the past twenty years. If they get out of the oversized house which they no longer need and move into something more appropriate they should have at least a hundred thousand dollars in profit which they can then use to pay their heating bills with.

Sadly, there are far too many people who would rather whine about how old and poor they are and how they need handouts from the government to stay warm in winter.

The people I feel sorry for are the young families who need the space and are wondering how they can afford the payments on an enormous mortgage. Payments which will certainly be far greater than their heating bills.

The sooner that we understand that dealing with global warming is going to require modest sacrifices from everybody the sooner we will be able to make some progress on the issue.

One: Pensioners and those on a low/fixed income. Especially if they don’t already pay taxes. What are you planning to do? Give them direct handouts? If you give them handouts equal to their carbon tax expenditure then expect them to continue to behave as before as this will be the cost neutral option to them.

Or expect them to reduce their energy consumption while pocketing the difference. Win/Win situation.

Why is it that when presented with a problem most socialists & environmentalists solution always seems to be “If it moves Tax It”?

Because there are a limited number of levers a government has for changing how people act, and this kind of soft pressure is usually less onerous and more efficient than passing laws capping the amount of energy people can use.

Because similar taxes have been proven to work; gas in Europe is taxed at about $4/gallon, and European cars get twice the mileage that US cars do. People can still choose to drive huge SUVs (and a few do), but people's choices are biased towards more energy-efficient vehicles.

Because we haven't heard a better alternative. You got one?

One way to compensate low income folks for higher fuel taxes would be to give them the highest mileage cars available in exchange for the old low mileage cars they are stuck with now. If my situation is typical of low income folks then exchanging my 17 year old van for a Prius would cut my gasoline use in half. That way the price of gasoline could double and I could drive the same number of miles at no additional cost to me. The half-life of the current vehicle fleet is 15 years and growing. That means that our current low mileage cars and SUVs will be with us for maybe another 20 years unless assistance is provided to replace them sooner.

I think the *median* car age is 9 years.

The average car about a year younger.

So the fleet turns over (90% scrapped) about every 14 years.

Your general point is a good argument for CAFE. Whatever the price of oil in 15 years time, by mandating a higher average fuel economy now, we get that fuel economy then for all drivers, not only those who can afford more fuel efficient cars.

The US could achieve a 20-30% increase in average fuel economy simply by switching to diesel engines (you have to adjust for the 13% higher energy content of diesel fuel). Half of the new cars sold in Europe are diesel (but we have compromised on air quality standards to achieve that, however the latest diesel technologies do meet US air quality standards).

A similar argument applies to air conditioners and other appliances. Many consumers are not sensitive to the cost of electricity for their appliances, but these appliances will often wind up, eventually, in the hands of the poorest consumers.

As the article pointed out, biggest part of the solution is demand destruction -- alternatives will not fill the gap. Demand destruction has to proceed in away that stakeholders agree that it is a legitimate and fair process otherwise people will not take part in an orderly demand destruction process. Demand destruction will occur regardless and if it is not orderly it will be disorderly. People will feel that their lives will be threatened and that their privileges will be threaten. People will take what they think will be their narrow self-oriented view of what is just and fair into their own hands. This will likely mean significant disruption in civil society.

It is not just the poor who do not have access to resources that will have an interest in this. It will also be the middle class and the well off. The well off, will not be able to walk in the streets, will have to protect their privileges with violence and live behind walls. The middle class may have to walk in the streets but they will have to do this with trepidation. They may want to carry fire-arms to make themselves feel safer.

The only solution to orderly demand destruction, if one accepts the premise that civil society must be preserved, is one which is viewed as legitimate and fair to the greatest part of our socities. We have to reach a common acceptable solution. I understand that government interventionism is going to raise a lot of headache because it is the practice of government to act for their constituents, but to label any government intervention as communistic won't get you pass perceptual road blocks. Libertarian positions certainly will not solve the problem if you accept orderly demand destruction. If you are willing to accept disorderly demand destruction then that is a valid option.

I think that the best way to find a solution is to analyse the problem as a tragedy of the commons problem. Without any social compact on how to access the resources in the commons there will be a free for all grab. Who ever gets the resource first depletes it first or whoever has the most muscle power pushes the other away and takes it away from the others. But these are not necessarily winning strategies.

There might be others who think they have adequate power to challenge you for the common resources and will attempt that. Or there are others which may have no hope and decide to take suicidal retribution and destroy the whole resource. Suicidal retribution may seem pointless to those have control of the resource, but social-evlolutionary research are finding that retribution (not necessarily suicidal retribution) is an adpative mechanism that helps societies enforce community and fair play -- it is an inherent part of human character to aid in the solution of communal problem (e.g. it is worth it to accept pain to yourself in the act of apply retribution if you can teach the perceived offender not to do the offence again in the future -- or elimate him. We likely not get rid of this for tens of thousands of years because it is an adaptive strategy. )

If a social compact is to be workable, it has to be enforcable -- as Thomas Hobbes said "A covenant without the sword is but mere words." As much as libertarians would like to get rid of government, this sword of government is necessary. We might, though, be able to structure the compact in a way that the sword remains without giving the sword holder more privileges than necessary.

There have been many workable solutions to the tragedy of the commons. It just seems that they have not been used much, most likely because some privleged interest did not want them in place. Tradeable quotas seems such a solution-- something like that has been done for the Maine lobster fishery and it seems to be working well.
If you can't use your quota, you can sell it. Other's pay you to use your share of the commons. The government exists then to enforce the quota, not to take away the wealth in the resource. This way of doing things requires that people in general first see a windfall resource as a common good and that seeing a resource as such is the first step in finding a workable solution. Many people have a vested interest in not seeing windfall resources as a common good -- and that is the tragedy of the tragedy of the commons.

No. New taxes are not the way forward. Why is it that when presented with a problem most socialists & environmentalists solution always seems to be “If it moves Tax It”?

Actually the typical 'socialist' and 'environmentalist' answer is to regulate the solution.

It's capitalists like me who see a major problem that can only be solved at a reasonable cost by applying market solutions that use market forces.

CO2 emission is perhaps the greatest negative externality that human beings have ever produced.

Free market economics tells you that if you have an unpriced externality, you have a problem, and a distortion of the market solution.

My parents are on fixed income. Their natural gas bill just went up. Do you hear them squirming? I don't. They get by, with or without my help. And since they have my support, they won't even have a financial downside. To me the additional $20 or 30 per month is not a big deal.

So if your elderly parents have a problem, it is probably because YOU are too cheap to help them.

Thanks for this post Euan.

I just want to call the readers attention to the apparent difficulties in tackling the problem with efficiency. This comes from growing Population that offsets those efficiency gains. That's not mentioned on the text; I feel it's worth mentioning it.

I would imagine that population growth in developed countries (ie those that use the most fossil fuels per head capita) is either static or falling.

The west (particularly the States) needs to deal with per head capita consumption and the developing countries need to deal with rapidly expanding populations.

Both problems look to me to equally well dealt with on the world stage. Ie. Neither is being tackled seriously.

Population is a bit of a red herring.

300 million Americans produce more CO2 than 1.3 billion Chinese.

1 million Americans produce as much CO2 as over 40 million Indians.

Analagously, if every Chinese burned as much oil in a year as every American, the world would be well past Peak Oil. (roughly speaking, every American is 24 bl/person/pa, every Chinese is c. 2 bl/person/pa, so China on a US consumption would be 86m bl/day, or slightly more than current world consumption).

The problem is population *living in a manner which burns resources at that rate*.

On population growth, the world is somewhat segregated:

- developed countries

Europe - population growth of 0 to 0.5% pa
US - population growth 1% pa
Russia, Japan - population growth less than 0% pa
China - something over 1% pa, but Total Fertility Ratio (number of children per woman in her lifetime) is low enough that this will fall to zero somewhere after 2030
India - over 1% pa but same downward trend in TFR-- population will stabilise around 2050.

Middle East, Africa - population growth over 3% pa. TFRs in certain Middle Eastern and African countries still over 4.

Europe - population growth of 0 to 0.5% pa

About 0.1% yearly over the next 20 years (link).

US - population growth 1% pa

Projected to be 0.8% yearly until 2050 (link).

Russia, Japan - population growth less than 0% pa

Estimated to be about -0.65% yearly growth for Japan until 2050 (link), and about -0.5% for Russia (link).

China - something over 1% pa

This is estimated to be down to 0.6% as of 2006 (link), and you're right that it should fall below 0% within a few decades.

India - over 1% pa

1.4% as of 2006 (link) and, although fertility is expected to fall to replacement level by 2020 (link), growth is seen as continuing rapidly through 2050 (link).

Middle East, Africa - population growth over 3% pa.

ME and North Africa: 2.5% over the last 20 years, projected to be 1.5% over the next 10 (link).

Sub-Saharan Africa: estimated to have declined to 2% (link), but growth will continue.

America's population growth was very close to zero last year. The entire population growth of America is essentially by immigrants and their children. Keep in mind that if an immigrant's child has children, that counts as part of the native born American population growth and not as an immigrant or their child.
Another way to look at it is that very large amounts of Mexico's population growth is still occurring, but just in America instead of Mexico. Most Mexican and other immigrants to America are in their child bearing years or younger. We do get immigrants from other countries, but except for a few Carribbean and Latin American countries they don't significantly impact population growth in those countries.
Cuba, Mexico, the Dominican Republic, etc, are the countries that are having their rapid population growth shifted to America. There are lots of Phillipinos, Vietnamese, Indians, Chinese, Russians, etc, but they are not so numerous in relation to the remnant population.
That's why Cantarell is so important. When America's dollar renormalises and half the Mexicans go home because their remittances are no longer important to their families, they are going to need lots of money from oil at the same time as they are going to make Mexico's oil demand soar. Cantarell is a serious problem.

I would count immigrants as part of a nation's population growth.

The Irish are Americans, aren't they?

There used to be towns in the Midwest that spoke only German (remember Franz Siegel's Corps in the Union Army? They spoke German and their officers gave orders in German).

Brooklyn used to be a city that spoke Yiddish, (and Italian, perhaps). Now it speaks Arabic, (amongst other languages).

I don't know what the legal population of Hispanic Americans is, but I understand the illegal population is around 10 million.

My own view is that these people will keep coming in the decades ahead, and the challenge for America will be to integrate them, and accept the changes they bring to American society-- just as the Jews, the Germans, the Italians, the Irish did before them.

It's worth remembering the 'No Nothings' who were a pre Civil War political party founded on opposition to foreign immigration, particularly by Irish Catholics.

And to read 'Studs Lonigan' or some of the other works of the time, or visit the Lower East Side Museum in NYC. The Irish were the scum of the earth-- uneducated, with a large criminal class (gangsters).

Now most Americans would be proud to say Irish blood runs in their veins.

There is an option that was briefly mentioned.

During WW II, Switzerland endured a six year 100% oil embargo yet they maintained a decent quality of life in a Western industrial democracy.

Oil use in 1945 was about 1/400th of US per capita consumption. The Swiss transported themselves and goods with (hydro) electric rail, bicycles, shoe leather and some equine horsepower. (Several thousand charcoal burning that feed gases to a gasoline engine, these worked poorly).

In the 1920s, the Swiss made the strategic decision to keep their trams (and enlarge them) whilst electrifying their railroads.

Today the Swiss are engaged in a massive and expensive Trans-Alp and related railroad improvements. One major goal is to shift freight from trucks to rail. Half the funds are going to build a flat, straight set of tunnels between Zurich & Milan. Freight can move at up to 160 kph w/o using oil.

Replacing heavy trucks that fill EU highways with electrified rail transport trades 1 joule of electricity for about 20 joules of diesel.

Greater use of (and expanding) electrified Urban Rail and electric trolley buses CAN be significantly increased !

My plan for the US can reduce oil use by 10% in ten to twelve years just from electrifying transportation.

Best Hopes,


The Swiss seem to know what they are doing. A couple of years back I also spent three days on the Swiss rail system working on a rail project out there. Travelling between Geneva, Bern and Zurich was a very positive experience. One thing I really liked was French, German and Italian trucks, when arriving at the Swiss border were put on trains, the whole truck, to cross the country. When they got to the other side they rolled off and continued by road.

What you describe is known as 'piggyback' in the USA.
Has been around for a long time. The trailers are loaded on railroad flatbeds and transported with the tractors.

However I have been seeing less and less. It was a nice idea but JIT took most of it out I am afraid. I could be wrong but thats what I see when I notice long trains. Very few piggybacks.

Also switchyards have disappeared. That is where 'consists'(the whole trains were put together. Now they use some other method that I haven't clued into as yet. More like using sidetracks or something.

I always favored rail over the Greyhound way back but passenger cars seemed to just fade away.


JIT is not a sacred cow. To install JIT production takes enormous resources which only the largest companies can afford. Few mid size and small companies have the risk tolerance and the legal muscle to go JIT. If the cost of JIT rises over that of medium sized storage (which it easily can with transportation costs rising), the companies which are using it can re-tool. The ones which are not using it, don't have to. I think the impact will be negligible.

But the lost infrastructure for railway transportation is not easily replaced. I am not sure we will see the railways pull the potatoes out of the fire for us.

As for railways in Switzerland vs. the US: it takes four to six hours to get accross Switzerland. It takes four days to get accross the US. That is a non-trivial difference which no train technology can bridge. Greyhounds and trains can simply not replace aircraft for intercontinental travel.

Sorry... that was meant to be "intracontinental travel", of course. The intercontinental part is even more trivial. Ocean liners seem to be less efficient than modern planes and on top of that cost prohibitive.

Steel wheeled trains scale to about 2x the highest speed in the US we put them to, about 6x the average speed, for a minor price in welding and wire tensioning.

Maglevs scale further, on up to around 400mph, for a major price. I contend that this price isn't all that much greater than the above, and a retooling of track sizes is in order, but that's another matter.

Evacuated tube or partially evacuated tube transport(say, helium-pressurized) could go faster than any suborbital mode of transit we have, for an outrageous price.

Alan, I’ve seen your post on the “Switzerland example” a few times and I’m afraid I have to take issue with it on a number of levels.

The first is that Switzerland is a very very small country with many town and cities with high density populations. These also tend to be very close together due to small physical size of the country.

Compare that to the US, which is vast and has many rural communities, (and are, in my opinion, the ones the benefited the most from car ownership) spread out over a large area. To connect all small towns in the US using rail would not be practical. Also as you yourself pointed out, urban rail schemes require a certain population density to become viable (and profitable). Below a certain point there are simply not enough taxpayers or paying customers to pay for the system.

The second problem I have with this example is the comparison of oil consumption.
Switzerland probably has the highest level of installed Hydropower in the world per head of capita.
Hydro is very cheap for them & it makes perfect sense to install it on your railway lines when you’re railways are state owned and quite short. It makes sense to run everything in Switzerland on electricity cos they had so much of it.

Again compared to the US, with its vast lengths of rail it would in many cases be impractical to use electrification (especially considering much electricity is coal fired)

On top of that, during the war Switzerland was probably able to run on equipment built/purchased prior to the war. Thus during the war they were able to suspend oil intensive manufacturing knowing that at some point the war would end and oil supplies would be restored. Thus all the worn out items could be replaced (I’m thinking tyres primarily). This would have the effect of making it look like Switzerland is very oil efficient when if fact all it is, is clever accounting.

Also, like many European countries during WWII, the major industry would have been manufacturing/banking in which most workers lived about 200 yrds from their employers. Car ownership anywhere in Europe in the 1930’s was quite low. Even now, I think that Switzerland would be in deep trouble if its oil was embargoed as it too has spent the last 50 years going the same way as the rest of us.

For a comparable example, you could say that in 1938 the UK used 1/40th the oil consumption per head of capita as it does now, as in 1938 the UK was pretty much all coal powered (complete with electric trams in all major towns).
However that example doesn’t help us now because the majority of the population live in a different distribution to back then, and pretty much most of our domestic coal is exhausted. We need a new solution going forward.

Sorry if this seems like a personal attack, I assure it is not. I am just trying to encourage debate and work out any logic flaws. After all in 40 years time less oil will be the norm and something will have occurred. Elec cars, restructuring, whatever.

Oh, and one last thing. I’m afraid I have something against urban tram systems.
Vibration. Here in the UK our right of ways often aren’t as large as they tend to be in the US. This means that if any urban tram systems are built they tend to pass close to buildings.
The heavy steel on steel contact has led to low frequency vibration which in areas of Manchester has led to deterioration in buildings foundations.
Having said that, we also have the same issues with heavy trucks, but this is engine related not motion related. I would be against urban trams as a result. Also with our limited roadspace we tend not to give up roads entirely to tramways along their whole length, thus a major accident (or road shutdown) would impact tram services with no option of rerouting. Again, I appreciate that this may be different in the US.

Because of all the above, I much prefer electric trolleybuses with small diesel donkey motors for shunting and (minor) rerouting. In many areas they also have their own bus lanes (like the NY BRT system) so can travel unimpeded. The installation of overhead cabling is less intrusive than major track laying operations.
And of course finally, having busses rather then trains means you don’t have to deal with the rail unions. Which are universally hated by rail passengers in the UK.

If cities like Athens and Bucharest can build trolleybuses then I’m sure they can be deployed anywhere.

I personally like the idea of trolley buses. It looks like they could be built quickly(quicker than rail?) which may be a bigger deal in the near future.

I like them too, mainly because they are vastly enhanced by inevitable improvements in the EV world. Combining a moderate-range battery with the easiest-to-build portions of wiring seems like a win-win to me.

Large intersection? No need to create a bloody canopy of guide-wires above, just allow them to disconnect and run right up until they get to the next straight patch of lines, and hook up there.

Regenerative breaking? Check.

Able to divert path to avoid anything or take a detour? Check..

Able to get through cold lines? Check.

Able to expand peripheral service significantly while new lines are being constructed by dipping in and out of the electrified portions? Check.

Able to build ONE heavily electrified, much much cheaper core route instead of wires going through every side street? Check.

There are two issues that have been posed to me, however.

1) How expensive over the long term maintenance and construction costs are for track as compared to beaten down roads. Metal is durable in a way that asphalt isn't.

2) It's preferable to have mostly segregated right of way for heavily travelled lines. In trammed-up European cities, instead of a grassy median strip there is a grassy median strip with a pair of tracks running through it. A transit experience can be easily made wholly unpleasant through the proper application of traffic.

So I think they should be mixed in roughly equal portion. There's quite a lot of potential in mass transit that was never realized in the US - our history is full of systems competing with each other when they didn't have to, and very little planning has been involved. Intermodal mass transit can fulfill a hell of a lot of what we currently assign to cars. In order of expected load:
Hybrid Minibusses, vanshares, jitney/taxishares
Regular hybrid busses
Batteried rubber-tired overhead-wired trolleybuses
Metal-wheeled trams with segregated but open RoW & grade crossings
Rapid Transit with fully segregated RoW & no grade crossings
Commuter trains

Two other overlooked issues with ETBs (which I support on routes w/o enough pax density to support rail).

1) Roughly 5x the friction losses for rubber tire vs. rail.

2) Twice the overhead wires & copper. Rail uses the rail as the ground/earth/return. A second wire is required for ETBs.

Disconnecting and firing up the on-board generator is a BAD idea. Operational nightmare ! Bus has to stop on other side to rehook (great for congestion), running an ICE for 2 minutes and then shutting down is bad for engine life, pollution, fuel economy.

ETBs last slightly longer than regular buses (Seattle rebuilt their drive train and put them into new bodies after 15 years) but no where near as long as rail vehicles. (I like my 1923/24 streetcars in New Orleans).

Most damning is that rail creates new ridership via Transit Orientated Development, buses (including ETBs) simply do not. TOD can double energy savings from rail, a savings missed by ETBs.

And vibration need not be a problem. Modern rail is inclosed in a rubber boot. New New Orleans Canal streetcars are virtually vibration free even with our jello-like soil (I can feel a freight railroad 1 km away or a passing truck bouncing me in bed).

I hope to have more time soon to respond, but not today :-(

Check back Sunday PM.


Disconnecting and firing up the on-board generator is a BAD idea. Operational nightmare ! Bus has to stop on other side to rehook (great for congestion), running an ICE for 2 minutes and then shutting down is bad for engine life, pollution, fuel economy.

I think the intention was that the ETB woudn't need an ICE. Instead, it would run off battery power for the brief time it was disconnected. Then, when it reconnected, it could use the power line for running as it simultaneously recharged the battery.

The extra weight of the batteries would have to be carried around (since the maximum discharge rate of chemical batteries is fixed at a fairly low level) quite a bit would be needed. In stop & go service, the lighter weight of ETBs is a najor advantage (adds life, reduces costs). Adding heavy batteries negates this.

Trolley poles would still need to be reattached. The Silver Line ETBs in Boston seems to have a better means of reattaching than traditional ETBs, but I am unsure of the details. And I have seen them not reattach, stop and manually mount them. I think remounting trolley poles requires a stop (wish I had observed more closely).

The best solution is streetcars instead of ETBs. Higher upfront costs, but higher ridership, TOD effects and lower operating (inclduing energy) costs.

Live with the overhead wires (as noted ETBs require twice as many) and do not saddle operations with Rube Goldberg-like "solutions" to non-existant problems. Battery operation works much better with rail (lower energy demands) than rubber tired buses and there are examples of battery rail operation.

Trolley wires can be made elegant and beautiful if that is a requirement (may add 5% to 15% to costs in most cases).

Best Hopes,


He's correct, no ICE.

The intention is that a personal EV only requires its many hundreds of pounds of battery pack in order to have a respectable range of hundreds of miles of hilly interstate. A trolleybus with a 2-5 mile unhooked range, on the other hand, only requires a moderate sized supercap + battery combination to drive efficient electric motors, and can recharge from the overhead wires when they get there.

I guess it does all hinge on whether an automatic at-speed cable hookup mechanism can be engineered - I was supposing that one already existed from the glory days of light rail, but I believe one could be easily created with modern electronics, guidance, and motors. More sophisticated robotics are used to build the bus itself.

In the US, dedicated right of way is rarely available for trams(and in its absence, trolleys can avoid traffic problems much easier). Track installation is often economically impossible period in low density suburbs, and that's what the US is filled with. I'm not very aware of the topographical limitations of rail, but there are plenty of steep neighborhoods near me I suspect wouldn't take kindly to loud, lower rolling resistance metal-on-metal wheels.

The best solution isn't necessarily a single solution. Cutting 10% of gasoline use by pushing a few hundred light rail projects in the densest areas is still only cutting 10% of oil. I live where rapid transit(the much-cited DC red line) is a reality, but you still need a car to get around. The last mile (or several of them) represents a HUGE difference - suburbia is never going to be completely abandoned. The massive amounts of TOD that the Red Line corridor is seeing now is mostly within a few hundred yards of the stations. Right now, last-mile to the majority of people's houses that use the Metro is served only partially by hybrid/CNG/diesel bus (most of us get there via car).

Two questions -
How well do recessed street tracks(because in most cases that is what we're talking about) deal with ice buildup?
Just how much of a reduction in energy per distance does a 5x reduction in rolling resistance deal out, for a vehicle with a typical bus/tram stop-start profile? Part of the reason I like the idea is because it would require a combination of batteries and supercaps - and a large supercap bank could, unlike most EVs, actually capture a majority of braking energy efficiently.

I guess it does all hinge on whether an automatic at-speed cable hookup mechanism can be engineered - I was supposing that one already existed from the glory days of light rail, but I believe one could be easily created with modern electronics, guidance, and motors

Pantographs have replaced most trolley poles for many decades (widespread post WW II ?). Our New Orleans streetcars are some of the last trolley pole systems. Pantographs only work for one wire (i.e. rail) and not two wire (ETB) though (technical reasons). Very easy to raise & lower for rail cars. ETBs have to still use dual trolley poles.

More sophisticated robotics are used to build the bus itself

Bad reports from first installations. Not recommended (yet).

In the US, dedicated right of way is rarely available for trams

Very easy, just take one traffic lane from rubber tires :-)

I also like the French solution, make the street "rough" in lane where tracks are. Still useable in rush hour, but drivers avoid the lane if at all possible.

My Desire Streetcar Line proposal took a narrow median, four traffic lanes and went to a wide median, two traffic lanes, two streetcar tracks and two bicycle lanes. An improvement :-)

I'm not very aware of the topographical limitations of rail, but there are plenty of steep neighborhoods near me I suspect wouldn't take kindly to loud, lower rolling resistance metal-on-metal wheels

Pittsburgh had 14.x% grades on streetcar lines in the winter :-)# Add sand (dropped automatically when wheels start to slip on new New Orelans streetcars) and braking increases dramatically. Emergency brakes are 4 one meter long, high friction bars that drop and magnetically attach to rails (SMELL during tests I saw).

Squeal should only happen on sharp curves and proper engineering can make that acceptable (on approach to St. Charles barn, streetcars pass 8 feet away from front porches on 28 foot radius curves, perfectly acceptable).

By my ear, a Canal Streetcar over concrete track was as loud as a passing pickup/small delivery truck. Over grass track, as quiet as a small car with good muffler, etc. Different frequencies (streetcar more pleasant :-)

How well do recessed street tracks(because in most cases that is what we're talking about) deal with ice buildup?

Biggest issues are with switches and ice buildup on lines. Electric heat (to 38F - 40F) on switches is common when icing is an issue. Running cars every 15 to 20 minutes all night long is one way to keep wires & switches clear during ice storms. Another method is "ice cutter" shoes on pantographs. Greater wear on copper, but keeps them clear.

See Toronto (a bit less than 1,000 streetcars from memory) for excellent ice & snow practices. Often streetcars are last vehicles operating from what I have heard. Also Calgary & Edmonton, St. Petersburg, Moscow, Helsinki, Stockholm, Oslo, northern Japan, etc.

Steel wheels will "crunch´ ice on rail in vast majority of cases.

Just how much of a reduction in energy per distance does a 5x reduction in rolling resistance deal out, for a vehicle with a typical bus/tram stop-start profile ?

Assuming equal regenerative braking energy savings (real world rail today vs. hypothectical capacitors that are "ideal"), and weights extrapolated from today, a 1.67 - 2 to 1 energy use advantage for rail in "best case" for ETBs IMO. "Hotel loads" (a/c, lights, door opening) would be equal which cuts the rail advantage some.

Best Hopes,


# 14.x% was for climbing track, less steep (12%) going down. SF had 16% grades (but no ice). 10% is probably max grade with modern practices. Most light rail designs today limit to 6% grade but that is quite "conservative".

The high grades are only possible with every axle being a driven axle with on board sanders when wet or icy.

A trolleybus with a 2-5 mile unhooked range, on the other hand, only requires a moderate sized supercap + battery combination to drive efficient electric motors, and can recharge from the overhead wires when they get there

Two blocks is quite doable w/o a/c. However, 2-3 miles off wire in service will require air conditioning (a major problem for EVs as well). Calculate demand for 7 tons of a/c (~7 kW with best available efficiency) for minimal cooling + movement for a dozen minutes to half an hour to get 2 to 5 miles off wire in stop & go service (avg 10 to 12 mph is typical).

I worked with Skoda to spec an ETB proposed for New Orleans. We settled on ~60 hp auxilary diesel motor (~20 mph max without a/c or heat). Good for short distances but not far.

A GEM would work quite well in commuting the last few miles from home to rail (and double capacity at Park & Ride lot :-). Bicycles too (except worst weather).

The best solution isn't necessarily a single solution

I agree. But while we are waiting for the supercapitor & viable PHEV/EV to reach market, why aren't we (in the DC Metro area) building

1) The Silver Line to Dulles & Tyson's Corner

2) The Purple Line to connect 4 DC Metro lines in the suburbs of Maryland (a radial outer line for those unfamilar, covers perhaps 120 degrees around DC)

3) 40 miles of streetcar lines in DC (I have helped a little bit with Anacostia)

now as we wait for what future technology may bring ?

All three could start construction within 12 months if it was an urgent national priority.

Perhaps we could even finish them (if we are lucky) before Isreal bombs Iran, Saudi Arabia has a revolution, Mexico stops exporting oil, etc.

Best Hopes,



Chemical super/ultra caps have been here for a few years now(I remember car audio people pushing them way back), and are steadily decreasing in price with higher volume. I'm not talking about pie-in-the-sky stuff like EEstor. They're simply a middle ground between traditional batteries and capacitors - great power(charge & discharge), low energy density, long life, great storage efficiency. A megajoule (about 50-100kg of supercaps, or 500kg of normal caps) is approximately what you need to capture all the braking energy of a bus, and use it to propel the bus back to speed with very high efficiency. You simply can't charge(or, really, efficiently discharge) normal batteries well at a hundred kilowatts in a braking maneuver - particularly a smallish bank of normal batteries. Stop-and-go bus traffic profile is ideal for their use.

AC isn't as essential in most of the country as it might be in NO. A literal "last-mile" approach was what I was aiming at. 1 mile out, 1 mile back, 1-3 miles reserve for traffic + luxury. Towns too small / low density for light rail to be practical could purchase a couple of buses & towers for a trunk line on Main Street, and range outward from there - each bus gets a loop through a different neighborhood in addition to the trunk line route.


I see no problem whatsoever with 150kg of lithium ions, 100kg of supercaps, and 50kg of cooling & insulation gear for them allowing a trolleybus to blast a 7kw AC in stop-go traffic for an hour off-wire reliably - certainly for 12-30 minutes on their normal route. The maximum power density and energy density calculations suggest several hours, but I'll stick with arbitrary conservatism - which is better for the batteries anyway.

It would seem that a system similar to this was put in place in Shanghai last year, with supercapacitors only and a pantograph that rises to charge when the bus is at a stop(they ran it on a normal trolley line). Unfortunately, they apparently didn't take into account temperature sensitivity of supercaps, and have ran a dozen of them into the ground on hot days in the last year, at a TOTAL PROJECT COST INCLUDING RESEARCH of... $150k. Gotta admire that, as an engineering student, the will to figure things out by trial and error. A US-led trial program wouldn't have let that happen, but they would have spent more than $150k on crash test analysis.

--------------------------- On local issues:
Dulles, Tyson's Corner, and the surrounding area is first and foremost, that represents by far the biggest opportunity around here.

A few more items -

Number 4: some provision for electric mass transit on the ICC, the 40-year old plan for continuation of I-370 that's finally being built. Incidentally, the ICC construction clips the property of a place you might want to visit next time you're in the area.

Number 5 would be short 1-train, 1-track "Christmas tree branch" light rail spurs from existing metro stations, to nearby development. Greentrack replacing median strips where possible. The last 1 or 2 miles to a mall is considerably higher load than the last 1 or 2 miles to a townhouse development. What are basically shuttle bus routes are now commonly loaded with 3-6 conventional buses, which take considerable amounts of time and fuel to deal with traffic.

Number 6 would be a longterm idea. I cringe to see the most prominent TOD occupying the space AROUND giant Metro parking lots. There is significant money to be made by Metro in land development extremely near stations. I say, build large mixed use complexes where we have thousands of ground parking spaces right now, and include thousands of spaces of standardized robotic parking garage in their place, below tens of stories of apartments/offices/etc. Robotic parking could potentially be several times more volume-efficient & faster than the best traditional parking garages.

Number 7 would be improving the intercity links with Baltimore, and their urban rail structure. BWI is used interchangeably with Dulles + National in the area, yet it takes a Marc or Amtrack train from DC to Baltimore, a shuttle from there to the Baltimore light rail line, several stops of dense city traffic, before finally you can board the airport's own shuttle system.

In mixed order:

7) BWI has it's own MARC/Amtrak station (a stop for the express services). Quick (perhaps 8 minutes) free airport shuttle ride from BWI airport terminal to BWI rail station. Xfer @ DC Union Station to Red Line. I have used this a dozen times and find it easier than Dulles.

There is talk about extending the WMATA Green Line to some new federal offices and then on to BWI. Another alternative is to do this in light rail and connect with the Purple Line (also planned as light rail) and the light rail @ BWI. Connect to East-West Baltimore Light Rail.

6) I have a position that surface Park & Ride around Urban Rail should be viewed as "land banking" for future TOD. Parking garages (non-robotic) cost ~$20,000/space. If the transit agency can charge enough for parking to cover interest & operations on $20K (say $4/day) well & good. If not, remove Park & Ride, build TOD and let people bicycle, "Kiss & Ride" or connect via bus. Others see Park & Ride as essential, I do not. I would be willing to make accomadations for GEMS since they are smaller.

In a more perfect world, one would replace parking lots next to the rail station with parking just outside the TOD next to the station. Rarely economic to do so unfortunately. I would rather have TOD than parking though (TOD tends to generate as many or more trips as the surface parking lots they replaced).

Cost for robotic parking ?

5) One problem with remote, isolated tracks is maintenance. Getting the vehciles back home for centralized cleaning & repairs. If they could use WMATA rails after PM rush and before AM rush, "it could work".

Each site is different. Two trains can easily use a single track with a passing siding (A section of double track in the middle). As an example, a small Colorado town once had a "Y" system.

3 single tracks that meet downtown. Each leg took ~15 minutes one way (30 minutes round trip). Every 15 minutes 3 streetcars would meet and transfer. The streetcar from "A" would go down "B" leg, "B" down "C" leg & "C" down "A" leg. A second set of 3 streetcars would meet 15 minutes later. I could imagine something similar with a WMATA station at the center. It would create a small community rail network as well as a feeder to WMATA.


4) The ICC highway is being built INSTEAD of the Purple Line (which would distrub the golf games of Ehrlich's buddies on a golf course). A waste of $ that will encourage more sprawl IMHO. Expect nothing good from this waste of money. Maryland has hocked itself for years (AFAIK) to build the ICC. No money left for rail, including on the ICC.

Mixed Use Buses: What we looked at in New Orleans was a trolley bus (light cheap durable) that would run under wire all the time (~2 blocks off-wire w/o a/c if road blocked, in yard, etc.) and hybrid buses (not light, not cheap, not as durable) that would be underwire part-time and diesel powered the rest of the time. The wire section would be the common street with other bus lines and the hybrid power section would be various neighborhoods.

Your weight calculations have to also include structure to support the batteries and power electronics (which you forgot). Heavier springs, frames, axles, tires, etc. are all needed.

Which is cheaper (lifecycle); a hybrid drivetrain or a battery/ultracap ? I don't know but a worthy R&D project.

Remember though, in all known cases, buses generate zero TOD and hence have NO indirect energy savings ! This makes buses inherently inferior to Urban Rail whenever there is a choice.

Best Hopes,


To connect all small towns in the US using rail would not be practical. Also as you yourself pointed out, urban rail schemes require a certain population density to become viable (and profitable). Below a certain point there are simply not enough taxpayers or paying customers to pay for the system.

Excuse me but 107 years ago 99% of all communities in the US were served by rail both passenger and freight. Today that number may be 50%, however much of the rail right of way is still in possession of the RR. In 1920 you could travel from Waukegan Ill to Columbus Nebr, a distance of 600 miles in less time than today using auto's and air.

BTW if you do not believe my previous comment, find a copy of an old Encyclopaedia Britannica. I have a 1912 edition. Look at the state maps of the US they show all the rail service, Amazing.

I believe that America's rail line maximum was around 1910 to 1920. The population has increased and spread out since then, but we are ripping up rail line faster than we have been building it over the last 90 years. That isn't counting trolleys.
Most transportation is by car these days. Electric cars can be built to fit our road system much faster than we can build tram lines or elevated railways, and the electric rail cars to use them.
I seriously doubt that we can increase rail use by more than a factor of ten at a reasonable price compared to the alternatives.

It would be an interesting race.

Current federal procedures are designed to slow down and raise costs of new Urban Rail (see speed & costs for comparable French trams systems).

EVs cost a LOT more/capita and consume far more resources (how many 55, 80 hp & 120 hp electric motors does the US/world make today and how many would be required ? Ditto for unique large batteries). EVs have a limited lifespan and the first ones would likely be scrapped before the fleet was 2/3rds EV. Urban Rail lasts *M*U*C*H* longer (most infrastructure half century to century+, rail cars 30+ years) so depreciated cost/year needs to be considered.

OTOH, Urban rail can scale up MUCH faster with quite mature technology and with a much smaller share of the GNP.

Phase I would to be to start building the following projects within 1 to 3 years (roughly $130 to $160 billion) and plan for Phase II. Increasing total rail pax-miles by x10 would be quite easy to do :-)
My goals would be in the x100 to x300 range (by the end of Phase IV).

Albuquerque – Light Rail and Commuter Rail plans
Atlanta - Beltway Light Rail, Northern suburbs Light Rail extension, downtown streetcar
Austin - Two Light Rail Lines plus Commuter rail and downtown streetcars
Baltimore - East-West Light Rail Line, 4 mile extension to current subway
Birmingham AL – Streetcar lines Boston - All rail plans promised as environmental offset to "Big Dig" Buffalo - Planned extensions to current light rail subway
Charlotte - All plans currently scheduled
Chicago – Expansions to Metra, South Shore Line
Cincinnati –Light Rail plans voted down
Columbus OH – Light Rail and streetcar lines
Corpus Christi TX – Streetcar line
Dallas - All plans through 2015 and all 2015-2030 options (roughly 145 mile system)
Dayton OH – Streetcar plans
Denver - 117 miles of Light Rail and Commuter Rail (already locally funded)
El Paso – Downtown to Border Light Rail
Ft. Lauderdale – Light Rail and streetcar plans under active development
Honolulu – Line currently under development
Houston - All plans voted for, 65 new miles light rail 8 miles commuter
Indianapolis – Light Rail Line plans
Kansas City – Light Rail Line proposed
Las Vegas – Light Rail plans
Little Rock – Short extensions of existing streetcar line, Light Rail line
Los Angeles - Red Line "Subway to the Sea", Vermont Avenue subway, XX miles of Light Rail, electric trolley bus plan, electrify commuter rail
Louisville KY – Light Rail line plans
Madison WS – Streetcar and Commuter Rail plans
Memphis – At least two Light Lines in comprehensive plan
Miami - 103 miles of elevated Rapid Rail (subway type) + Miami Beach streetcar (already locally funded) 90% of the population would be within 3 miles of a station, half within 2 miles of a station
Minneapolis-St. Paul - Central Light Rail connector between the cities, Northstar commuter rail
Missoula MN – Commuter Rail
Nashville – Commuter Rail in process
New Orleans – Desire Streetcar Line, Riverfront Streetcar Line extensions
New York City - 2nd Avenue Subway, 3rd Tunnel under Hudson, Penn to Grand Central connection, Staten Island Light Rail, New Jersey Light Rail extension, commuter rail improvements
Norfolk – Light Rail Plans in progress
Ogden UT – Streetcar plans
Orange County CA – Center Line Light Rail plan voted down
Orlando – Light Rail plan voted down
Philadelphia – City Branch, Roosevelt Blvd. extension of Broad Street subway
Phoenix - 90 miles of Light Rail already approved Pittsburgh - Two Light Rail Lines north from current, under construction line Portland - Green Line (both routes, one funded, other "studied" for future), Streetcar both sides river
Raleigh-Durham NC – Streetcar plans
Sacramento – Additional Light Rail expansion
San Antonio – Light Rail plans voted down
St. Louis - All plans evaluated, perhaps 100 mile system
Salem OR – Streetcar plans Salt Lake City - 90 miles of Light Rail, streetcar and Commuter Rail (vote soon to accelerate)
San Diego - Light Rail spur to North, another to West
San Francisco - New TransBay tunnel, trolley line, BART extension, eBART, Marin-Sonoma commuter rail, CalTrain extension to downtown TransBay Terminal
San Jose - BART extension, several Light Rail extensions
Seattle – Proposed north extension
Spokane – Light Rail line planned
Tampa – 1992 and later plans
Toledo OH – Streetcar plans
Tuscon AZ – Streetcar plans
Washington DC – Tyson’s Corner-Dulles extension, Purple Line, 40 miles of streetcar lines in DC, Columbia Pike Light Rail Winston-Salem NC – Streetcar plans

Reasonable cost. Just ballpark. All constant $ value.

10 million EVs/year x $20,000 (2007 $) each = $200 billion/year current $

Average life (assuming new super battery has no issues with life) = 15 years (about = today).

In 30 years (when the Phase I rail vehicles start to get replaced) EVs cost $6 trillion with "no end in sight". Street & highway maintenance gets more "deferred".

OTOH, rail systems should be finishing up "Phase IV" and a glut of rail design engineers, etc. as the market is finally glutted with, say, $2.5 trillion in Rail investments. Rail vehicle manufacturers switch to replacement vehicle production.

EVs are NOT the quick, cheap, easy "solution". They also preserve a high energy use urban form.

Best Hopes,


Alan, what do you think of Personal Rapid Transit?

I'm fascinated by the promise of things like PRT, and vehicle sharing services, which use computer/online scheduling to make entirely new things possible, with the promise of both greater convenience and lower cost/greater efficiency.


Let the Japanese, who are fascinated with new means of transport (they have a handful of speciality application monorails that work, a demo maglev, first with their bullet trains (before TGV & ICE)) prove that it does not work. We should not even waste R&D $ on it (spend the $$$ on something that works and we will NEED badly in the near future).

Even if proven practical (virtually impossible IMO) we are 25 years from widespread implementation (as the various stages of maturity require time to develop & gain operating experience). We cannot wait 25 years IMO.

There are insurmountable scheduling issues with PRT (terminal jams keep developing in mathematical models), the "low costs" came out of someone's rear#, maintenance & security issues, etc.

The VERY nice thing about rail is that all sorts of speciality items have been tried. Many failed, some worked. The optimum sizes for different modes were slowly discovered (each of the Boston subways kept getting wider cars as they were built one after another).

Car share "works" but with uneven results. It is not clear (AFAIK) why the results vary. More experience needed IMO but worth trying.

Call-a-ride barely works, at very high costs, in semi-rural areas or areas with VERY low transit riding habits. Ask any handicapped individual that uses paratransit about service quality (about 80% of paratransit operations in the US have been under a court order at one time or another due to poor service).

Best Hopes,


# The HIGHEST cost transit services in the US came from promised "low cost" innovations. The rubber tired "electric bus/monorail" elevated in downtown Miami and the Jacksonville monorail both promised and failed miserably in lowering costs & better service.

I know it's tempting to ignore time value of money, but you really can't. An expenditure 30 years from now is only 15% as valuable as an expenditure right now (at 6.5%, the current 30 year mortgage rate).

$200B annually for 30 years is only worth $2.37T, or less than the mass transit investment of $2.5T.

And sure, we won't spend the rail $2.5T right away, but we also won't get the value right away either, whereas PHEV's will be capable of scaling up pretty quickly - GM, for instance, says they're satisfied with the specs from their two battery suppliers, they're just waiting on battery pack integration and controls, and testing (which is unlikely to be a problem, as both battery chemistries are in commercial use and have undergone much testing already for those applications).

As for a high energy use urban form - I just don't see it. Once transportation is electrified (especially with EV/PHEV's, which provide wind intermittency-reducing storage), we really don't have an energy supply problem.

And I love living in a dense urban neighborhood, but I wouldn't want to try to force other people to live this way, if they don't want to.

I really don't see a need to compare the two technologies (EV and rail). Both are needed. Heck, I use rail everyday, and I love it. It's by far the better way to commute, but I also wouldn't give up having a personal vehicle, even living in a dense urban neighborhood.

I know you're afraid that rail will be ignored, and I suppose you're right that that's a real danger. Still, there are a lot of TOD readers who are quite scared about the implications of peak oil, and they need to know that there are a number of viable, complementary solutions.

1) If you use inflation of 3% (optimistic) the real interest rate is 3.5%, which gives a much lower discount rate.

2) PHEV's will be capable of scaling up pretty quickly

One of my points is that PHEV's are NOT capable of scaling up quickly to even 2 million/year, much less 40 million/year (we live in a global economy, the US must compete for scarce components with everyone else). 500,000/year sure (although Toyota could sell more Prius's if they could make more TODAY). IMHO, we are close to current technology hybrid/EV production capacity. It is expanding, but we are several years away from 1 million Prius type hybrids/year.

3) we really don't have an energy supply problem

Not today (except for that annoying Global Warming) but we will in 30 years unless we "change our ways". I wrote a TOD essay to the effect that an EV solution set us up for a second crisis beyond Peak Oil IF we maintain our current urban form. But as Stuart noted, he expects to be dead by then, so why worry about younger folk ?

There is no need to "force" people into a dense, energy efficient urban form. Peak Oil will be a brutal iron rod (not a stick) and all that has to be done is provide an alternative refuge/carrot and people will flock to it. See how we changed the US urban form from 1950 to 1970. Killed virtually EVERY downtown, scrapped much of our well built pre-WW II housing stock, etc. Just provide an energy efficient, livable alternative and let Peak Oil & the market help out.

More, but I have to take friend to free Health Clinic (need to be in line by 6 AM to be seen today).

Best Hopes,


I know you're afraid that rail will be ignored, and I suppose you're right that that's a real danger

Rail is not even on the radar of potential solutions outside of TOD and related venues. Ethanol (from corn or switchgrass), the "Hydrogen Economy" with fuel cells, PHEVs & EVs and MAYBE even an increase in CAFE. Higher gas taxes are at least discussed before being dismissed.

Electrified rail (freight intercity & Urban) has a unique advantage post-Peak Oil (IF we build it). Post-Peak Oil will not be a smooth even slide down, but will bounce from crisis to crisis. Electrified rail has elasticity of supply if demand suddenly jumps dramatically.

Major impacts on US oil demand can be in place within a decade if we start today.

You are right that we need multiple solutions. PHEVs & EVs cannot be ramped up quickly enough (even if we knew how to build them economically AND they alone could solve the post-Peak Oil problems).

I also have a car, I just do not use it much (pre-Katrina 5 to 6 gallons/month, more now shuttling people to remote health care not served by buses, etc). Walk to make groceries, streetcar/bus to some work, entertainment, etc.

Best Hopes,


"If you use inflation of 3% (optimistic) the real interest rate is 3.5%, which gives a much lower discount rate."

Well, I've been wrestling with that. On the one hand, the real interest rate for government loans, which might apply to rail, is more like 2%. On the other hand, consumer interest for vehicles is much higher, so I took what seemed to be a compromise. On the 3rd hand(!), if we use 3.5% the present value for the EV option is $3.3T, still not that much different from the $2.5T in the grand scheme of things.

"One of my points is that PHEV's are NOT capable of scaling up quickly to even 2 million/year, much less 40 million/year (we live in a global economy, the US must compete for scarce components with everyone else). 500,000/year sure (although Toyota could sell more Prius's if they could make more TODAY). IMHO, we are close to current technology hybrid/EV production capacity. It is expanding, but we are several years away from 1 million Prius type hybrids/year."

Up until 2005 hybrid sales were doubling annually. IIRC last year they only(!) grew about 40% worldwide (for all manufacturers), and Toyota expects growth to continue at roughly that rate, which would be doubling every two years.

I suspect hybrid growth has been slowed down by the transition from NIMH to Li-ion - battery manufacturers aren't going to want to expand the old product any more than absolutely necessary just before the transition to the new. Further, I suspect Toyota has been happy with slightly constrained Prius sales: the markup is higher on a product that until pretty recently was subsidized. In a year or two the next generation li-ion hybrid powertrain will go into production which will cut the cost about in half, and that will help sales grow faster.

In my observation a 40% growth rate (doubling every two years) is sustainable at any level of scale for a pure manufacturing thing, like cars, PC's, cell phones and wind turbines, without excessive strain (I'd be interested in hearing about more examples, or counter-examples), especially considering that we're talking about converting ICE models to PHEV, not a whole new industry. That growth rate for 10 years gives you 32x the volume, or 14M cars (IIRC 80% of US car production), and 14 years gives you 128x the volume, or 55M cars (IIRC 76% of worldwide car production). OTOH, a WWII style effort could accelerate that greatly (from 2k to 86K fighter planes in 4 years).

"we really don't have an energy supply problem...Not today (except for that annoying Global Warming) but we will in 30 years unless we "change our ways"."

I should have said electricity supply. Do you really think we'll have a shortage of electricity in the US in the 30 years??

"Peak Oil will be a brutal iron rod (not a stick) and all that has to be done is provide an alternative refuge/carrot and people will flock to it. "

Are you talking about gas prices? I had this discussion with Mike Smith elsewhere in the comments on this article, where he agreed that the maximum price for oil was likely to be very roughly around $100, as alternatives like PHEV's reduced demand in response to supply shocks. That's reasonably consistent with Westexas' pessimistic expectation of successive supply shocks wringing out demand.

If gas prices double you can keep your overall transportation expenditure roughly the same by buying a Prius (which is expected to get cheaper (as a practical matter), and increase fuel efficiency by about 25% in the next model). Don't forget that gasoline is only about 10 cents per mile on average now, which is about 20% of the IRS's figure of 48.5 cents per mile of overall driving cost. If they quadruple a serial hybrid like the GM Volt would again cut your costs back down to current expenditures.

Dense urban housing costs several times as much per square foot. Moving costs alone are comparable to the cost of a new car. It's much, much cheaper to replace your vehicle a little early than to move into the city. Sure, governmental policies helped the move to the suburbs, but mortgage deductions would be needed even more to afford urban housing.

An expenditure 30 years from now is only 15% as valuable as an expenditure right now (at 6.5%, the current 30 year mortgage rate)

I took an 1897 subway every day from the hotel to the ASPO Boston conference (and routinely take 1923/24 streetcars on an 1834 streetcar line). Perhaps half of the current in-use value of the Green Line (Boston subway) infrastructure is over 100 years old (stations were rebuilt in 1920s for higher volumes of people and are being rebuilt again for handicap access today). I am glad that they did not say in the late 1800s "Let us cut costs by 8% and build it to last for only 50 years".

There is a NY bridge (Tappen Zee ?) where exactly this happened. The 50 years are up. If the New Yorkers had just invested that saved 8% in US Treasuries since the Korean War, ...

The "fully depreciated" value of Boston infrastructure adds considerably to the economic viability of the city. A society that keeps adding to useful long lived infrastructure creates wealth for future generations.

Example, the Swiss Trans-Alp & related rail projects will take 20 years to build (economic = to US spending $1 trillion) The Swiss will see a "step function" in oil use as freight is moved from heavy truck to (hydro) electric rail as well as more high speed pax rail, quieter rail cars (1 billion Swiss francs), etc.

The new tunnels are being built to last 100 years before major maintenance.

Now, an MBA would have told the Swiss (and some did) that this whole deal was a bad investment (oil was $12 when the Swiss voted for this 2000-2020 project 30 billion Swiss franc project). Time value of money during construction, uncertain returns, etc. 2/3rds of Swiss thought otherwise.

But MBAs should not have children either :-)

Best Hopes for Long Lived Infrastructure Investments,


The $2.5 Trillion to build every concievable Urban rail project would be over the same time frame as building EVs, so discount it too. The Urban Rail infrastructure will have many decades of residual value left after 2037, the EVs will not.

I'm not opposed to long-lived infrastructure investments. I think that external costs and benefits push in that direction. For just one instance, the public costs of construction-related disruption due to maintenance and replacement of short-lived infrastructure are never figured into the calculations. The Chicago CTA Brown-line station replacement project, for instance, will double commute times on this important route for more than a year, and increase them somewhat less for 5-6 years.

I just think you're being unfair to EV's. On life: there is a difference between fashion-based obsolescence, and functional. We own a 3 year old car, and we also own a 22 year old car (Toyota). They are essentially equally reliable (though definitely not equally fashionable) - I suspect we'll have to shoot the 85 model if and when it's time comes. EV's will have even longer lives and lower maintenance costs, as they are functionally much simpler. In this vein, Prius owners report very high reliability, and I expect they'll be in service for 30 years (maybe in South America near the end).

Again, I support rail. I think it's many indirect benefits (safety, lack of stress, speed & convenience(in the right situation!)) make it invaluable. But...personal vehicles offer their own benefits, and we shouldn't suggest that they aren't viable post peak oil if the facts don't support it. That's alarming people unnecessarily, because people intuitively recognize that personal vehicles are very, very useful and that losing them would be a big sacrifice and an indication that things were getting quite grim.

I agree that there serious risks of things getting grim, if we don't plan ahead. I just want us to be realistic as to the range of possible solutions, and their viability. I believe both PHEV/EV's and rail are important pieces (both of which should be accelerated), and a good future is perfectly possible if we plan well.

I should note that I think the likeliest scenario is muddling through, with things being...."ok". We'll suffer unnecessary costs and pain, such as the current adventure in Iraq and maybe a minor recession or two, but with a little luck (like avoiding nuclear terrorism, or a regional ME war) we'll get through ok. It would be awfully nice to do better than that...

The weasel in the wood pile is Global Warming.

'Muddying through' will not be enough, at least not enough for those alive post 2050.

I think the weather in the next decade or so will bring a wakeup call. We are now talking on the order of a 0.4 centigrade temperature rise per decade from now to 2100.

One can explain away New Orleans if one wants:

- from the Right: poor people, bad city government, highest murder rate in America, people ignoring what they were told, Democrats' corruption, city should never have been built below sea level (subtext: poor, black people so who cares?)

- from the Left: FEMA gutted, Marine support ships rerouted, Republican malfeasance, underinvestment in the levees (subtext: poor, black people so America doesn't care)

But when it comes to Miami, or Houston, this is all going to be a lot harder. Ditto crop failures in the Midwest, groundwater depletion, flooding in lower Manhattan, drought in California (around 1100, California had a 200 year drought), malaria etc.

And then there is, of course, the possibility of mass migration from Central America into Mexico, and from Mexico and the Carribean into the United States, as agriculture becomes more difficult (it's the poorest Mexicans who move north, not the richest).

Fortunately, Mexican immigration is not something Americans typically worry about ;-).

Oh, I agree. GW is a much bigger and harder problem than peak oil.

If we solve GW then PO takes care of itself. Fossil fuel consumption will end much sooner because of GW.

I suspect GW is giving Saudi princes nightmares.

An Urban Rail orientated solution to Peak Oil will do significantly more for GW than will an EV orientated solution.


On a speperate note I would be interested to see the breakdown of UK road fuel use.

The reason I ask this, is, in a scenario where oil is expensive or unavailable in sufficient quantities decisions will have to be made as to what the fuel is used for. Relying on price as a demand destructor will not be pleasant.

Ultimately it is the job of the government to keep inflation at a low level. If we see huge price increases for our fuel this will have a number of knock on effects. The first is that it will increase the cost of basic groceries and consumer items. Secondly although fuel price is usually quite a low proportion of household budgets, these budgets are normally fixed, and any increase in fuel expenditure (either for transport or home heating) will result in a directly proportional decrease in discretionary expenditure. This coupled with rampant inflation would result the high street service sector going rapidly down the pan.

Ultimately I would rather the government stepped in and ban fuel for certain uses/rationed it to individuals. This would result in a decrease in consumption which will reduce prices. This allows essential industries (agriculture, haulage, utility companies) to continue to function and keep prices down. This contributes to low inflation.

Ultimately I would rather ban private use of diesel to keep the price low for industrial & haulage use. I don’t imagine that much more than half of the nations diesel supply goes to haulage use, which is vital to maintain.

People can walk/cycle/car pool to supermarkets, but supermarkets have no choice over their deliveries. I also have my doubts about the viability of “local” farming to provide enough produce (and get it in right place in time) to satisfy local demand. Large scale industrial farms are mightily efficient and haulage doesn’t use “that” much diesel in the grand scheme of things. Efficiency of scale may trump haulage energy use and make it the better choice.

As mentioned thought, road fuel is also only half the battle. The other half will undoubtedly be natural gas consumption. This is going to be much more difficult. Replacing base load NG gensets with nuclear power would be an excellent first step. One of the things I have never understood is why the government cannot simply place a moratorium on new NG genset capacity.
If the market mechanism understands that new capacity is require (which is does) then by taking away the option of licensing of new NG powerstations it forces the markets hand to build coal capacity. The government is there to take strategic decisions that are beyond the horizon of the market & investors. I see it as failing in its duty to provide strategic guidance in this area.
Further, I would also like to see a moratorium on new coal capacity without carbon capture. I suspect this would lead to a clamour for new nuclear capacity (which we desperately need) due to the cost.

However the (inept) UK government seems to be unwilling to implement these measures. Up to a point I can see why. There will be a cost implication of eschewing cheapo coal capacity in favour of nuclear, but it has to be done for the sake of energy security.
Far worse though is the requirement for NG for home heating and cooking. This cannot be quickly worked out of the system and will cause the most pain in the event of a gas supply disruption. Again, we can probably absorb some price increase easily enough, but outages are not acceptable. Long term (30+ years) redundancy of supply from multiple suppliers for deep winter supplies are a concern.
And whats the alternative? Electric heating and cooking? Unlikely as we simply don’t (and probably won’t) have the capacity to provide for the peak loads and I fear we’d also struggle to provide enough energy for consumption on average too.
If the 35million + housholds in the UK required an average of 1.5kW (constant) during the winter to maintain heat we’d need an additional 52.5GW of continual genset provision during the winter. This is an increase of more than 60% over our current installed capacity and would likely all need to be nuclear (as the increase in coal consumption would be undesirable)
Alternatively we’d need 78,750 two MW wind turbines plus some method of storing the energy for use (peak power would be 157GW btw). Which is a wind carpet measuring 175 miles by 175 miles.

Me? My dream is to build myself a passivehaus sometime before I retire. It’d also be nice if I could own a hectare of land somewhere that I could grow short crop trees on for fuel.

I've been thinking about this myself, but from a French perspective.

Where is fuel used in the system: everywhere, but some places it's more essential than others.

ATM France is doing OK on the electric front (thanks to being 75% nuclear), and many big cities have electrified public transport (not counting the railways which are electrified too). One solution to feeding the 500000+ cities would be to use this infrastructure more: in the evening, when passenger services slow down, use the spare to bring food in by train, then use trams to distribute it throughout the city, all with 0 oil use.

As far as rural areas go: encourage telecommuting, and keep around 20000 ethanol powered cars/vans nationally to allow infrastructure maintenance (on the power lines etc...). In rural areas, you can grow a large amount of your own food anyway, so distribution is much less important.

This would probably allow an 80% reduction in oil use, easily enough to keep dire consequences far enough away to enact more permanent solutions.

Of course, this implies everyone making the necessary adjustments, and the powers that be doing what's right (and not trying to keep the market afloat at the expense of the people, IOW what happened in the great depression before the New Deal).

Of course, I could be wrong, and this would just make things worse, and no, I unfortunately don't have any figures to back this up.


On electricity supply the UK has a privatised system with an open market price for electricity.

The result is the government cannot dictate the fuel choice (they did ban new gas stations for a while when they came into power, to keep jobs in the coal industry and look after a traditional Labour sector. For the same reason, the Tories were desperate to kill the coal miners unions).

Government intervention is limited:

- the Non Fossil Fuel Obligation (NFFO) in the 90s, which pumped £10bn or so into the nuclear sector (to complete Sizewell B, and for waste disposal)-- effectively a 5% (?) tariff on your electricity bill

- the Renewable Obligation Certificate, which is part of what drives the creation of the wind industry

(half our wind capacity, or more, will be offshore, btw-- that way it's much easier to site the wind farms next to the demand centres, and the wind is more reliable. See The London Array)

- potential for new government subsidies to create a successor class of nuclear reactors to the Advanced Gas Reactors currently in use (except for Sizewell B, which is newer, and a Pressurised Water Reactor)

My own sense is if we are smart, we will evolve towards a fuel mix like this:

30% nuclear baseload*
30% renewables (CHP and wind, primarily)
40% coal and gas with carbon sequestration - Centrica has already begun to plan for a carbon sequestered coal fired plant

Couple that with aggressive demand management and conservation targets (which could knock a quarter off UK electricity demand) and we have a workable power system.

All of the above could be achieved by 2030, but it would require significant market interference by the Government. Otherwise the market will build gas and coal fired plants.

I agree if there was not enough gas for home heating and hot water it would be a serious problem. There are solutions (eg heat pumps) and certainly the UK could do far more with insulation, if it so chose. The UK housing stock is one of the worst in the developed world from an energy efficiency point of view.

* probably achieved with 5-10 '3rd Generation' reactors (a la Flamanville in France) each with a capacity of 1350-1600MW. Cost per reactor around £4bn although there could be significant economies to scale.

I'd like to see a proper simulation (and perhaps even live testing) of a fully fueled and loaded 777 rammed into a Flamanville containment vessel at 550mph. I believe the original tests (US 1960s) were done with an F4 fighter plane, which would have very different characteristics.

I shouldn't be writing this, but a few weeks ago I did some work for EDF on porting the program which simulates an aeroplane crashing into a reactor containment vessel. Just a matter of verifying that the results of test runs were the same on different hardware platforms.

The only aircraft which were modelled, in the test data I had, were a Rafale fighter plane, and a Canadair fire-fighter. The reactor was a previous-generation one, not a 3G. The only way I could get the reactor vessel to rupture was to fire the Canadair into it at near supersonic speed, which is not a realistic scenario...

EDF is not likely to release test results, or even to run the simulations, for a 777 or an Airbus. Quite simply, there's no point, they already know the answer...

It would require considerable over-engineering to protect against a commercial airliner as a missile. They didn't take it into account when they were designing the EPR, because it was unthinkable at the time.

The Finlandian customer for the first EPR demanded aircraft crash safety wich lead to a strenghtening of the impact protection. The official web pages only state "large commercial airliner", I have no knowledge about details.

There's a consultants engineering report (sponsored by Greenpeace) that you can download from the web, criticising that report, and saying it wasn't properly done.

Yeah, like I can trust those guys.

But the reverse is also true-- you can't trust the industry that wants to build the power plant.

"It would require considerable over-engineering to protect against a commercial airliner as a missile."

Dig a 100 feet deep hole, lower reactor containment in, pour a concrete slab, put dirt over it, plant a tree. Unless the US nuclear strike force decides to attack, you are safe.

What is so hard about that? Too expensive? Too bad... buy more solar panels, then. Nobody is going to fly a plane into those.

You are aware that upon impact with concrete at 550mph, aluminium has similar properties to, say, cheese.

About the only thing to worry about would be the engines.

And even then, if you managed to crack the containment vessel it wouldn't be the end of the world unless the reactor was also in the process of exploding at that exact moment. Not forgetting that modern reactor designs have inherently passive safety systems in the first place, so they no longer explode Chernobyl stylee.

I think that the failure point is sufficient cooling capacity to get rid of the radioactive isotope decay heat from the reactor. The reactor power level falls ninety percent the instant you hit the off switch, but the residual 100 megawatts of cooling is the problem. It takes a few hours for the water in the containment vessal to boil off, and then you get a Chernobyl situation with radiation plumes coming off and wiping out the evacuating locals as they sit in the massive traffic jams.
My threat profile for a reactor is a 155 millimeter howitzer a few miles away, served by some Al Queda. Reactor cooling towers are not designed to be artillary resistant.

Fortunately that is a very tough scenario to engineer.

Big artillery isn't that common. It's not easy to steal.

It is very visible.

I am thinking of nuclear power stations in the UK, which is a relatively densely populated, highly controlled country.

It's not simple to operate. Even an ordinary soldier wouldn't know how (a military mortar is another matter). Fire needs to be observed.

You could do it with 82mm mortars, though. Although a quick response could foil you-- a fighter plane could be over your position and strafing you in minutes.

Perhaps a more likely scenario is the old IRA favourite-- the homemade mortar. They can fire some big shells although they are inaccurate.

My understanding is once you scram the reactor, then you have an emergency cooling system. So you'd have to take out both the ECS and the primary CS.

The key in the WTC was the *fire* which was started by the aviation fuel going up.

There is also the issue of damage to critical elements outside the containment vessel.

And there is 'spalling' the phenomenon of something flying off on the inside, if you hit it on the outside. This is how a type of tank shell called the High Explosive Squash Head (HESH) works.

I think Flamanville is to be built with a double containment vessel.

Missiles I am less worried about. It's a pretty sophisticated military missile that can punch through 2 layers of reinforced concrete, and do significant damage on the inside.


I think the new Drupal platform doesn't allow the old *HTML* /shortcuts/.

Click on the input format tab below the comment box and you will see the HTML formatting tags.

[ b ] text [/ b ] gives bold and
[ em ] text [/ em] gives itallic

apart from you need to use the less than or greater than symbol and not [ - I have to use [ or else my comment will get formatted.

appologies if you already knew this.


Figure 1 shows a peak (presumably of crude + condensate + NGL) in about 2011-12. According to many recent analyses on this site, this is optimistic. What if westexas and others of similar opinion are correct - that peak for these components is about now and we will decline from it within 12-24 months? What influence will this have on the timing of "the gap" and the timing of the shortfall being equal to "another Saudi Arabia plus Kuwait"?

Also, the peak is about 95 million bl/day for these components - a level few contributors to this site (including myself) think will ever be achieved, indeed analyses by Khebab and others suggest it may go no higher than it is now. Does this mean we need to do what is recommended in this piece, only more so and faster, or is a completely different strategy needed? To me, our current cosy way of life (with or without electric trams) does not appear be viable for much longer and Britain in particular may be facing a sharp and long-lasting economic downturn from the end of this decade.

Dr Bob:

Figure 1 shows a peak (presumably of crude + condensate + NGL) in about 2011-12. According to many recent analyses on this site, this is optimistic.

Are you sure you are on the right site? If you look at the Tables in Khebabs recent peak oil update you will get a good overview of what analysts believe.

Michael Smith's forecast is included in Khebab's summary that shows far and away the vast majority of forecasts showing a peak around 2010-12 and beyond. Khebab's own loglet analysis suggests 2012 - and that is the date I have nailed my colours to. I don't think there is a single contributor or editor at The Oil Drum (with the possible exception of Stuart) who believes that peak is past.

True, Peak Hysteria has gripped TOD in recent months. Certain posters seem to have nothing else to do with their time apart from to post the same opinions over, and over and over again - repetition doesn't make them right.

With respect to a peak at around 93 mmbpd - I have no problem with that, we are currently on around 84 mmbpd, OPEC almost certainly have around 3 mbpd reserved capacity, and there is more to come from Azerbaijan, Kazakhstan and Angola.

So please go read Kehbabs post.

The short answer is, No, there isn't a painless way of filling the energy gap. We are, I believe going to be in for a rough ride as we, hopefully, manage to move from one form of civilization to another. I'm an optimist at heart and a fighter, coming from a long line of soldiers. However, we are not moving in the right direction at the necessary speed to avoid massive dislocation of our way of life.

I recently read "Twilight in the Desert" and the book disturbed me profoundly. If Simmons is half-right about the problems in Saudi Arabia, then we're in trouble. How on earth is Saudi going to ramp-up it's oil production by 50% or more to satisfy increased global demand if the oil just isn't there? Given the lack of transparancy relating to Saudi production levels and real reserves, we appear to be basing the future well-being of civilization on "Hope" more than anything concrete. It would appear that we need something like an internationally verifiable independent audit of Saudi Arabian oil reserves as a priority. The political ramifications for the current Saudi regime are serious if Simmons is correct, and they've far less oil than we all seem to assume.

I also don't believe in a technological fix for the coming energy gap. It will be too little too late in my opinion. What we need is conservation and a substantial cut in our energy consumption going forward. How one actually achieves this in the real world is a truly gigantic question. For starters, in an ideal world, the United States should take the lead and reduce energy consumption by 50% from current levels over the next twenty years. How realistic is this? Does anyone really, truly, believes this will happen? The consequences for the US economy and standard of living of such a programme are stark, to say the least!

Another book I read recently was "Blood and Oil" by Michael Klare. It's an interesting read, as the Chinese would say. He's recently become even more pessimistic about the future. Appearing to believe that we're moving in the direction of energy fascism. The US army is rapidly moving in the direction of becoming a military force primarily dedicated to the control and maintenance of uninterupted access to energy supplies. The "war on terror" acting as a convinient gloss and cover-story to disguise the true reason for expending so much blood and treasure across the globe.

Put very crudely, I think the American elite and their allies will choose the military solution to the coming energy gap. That is, they will use the US military to secure energy supplies in order to maintain their power and standard of living, for as long as possible, at whatever price and devil take the hindmost!

Once again, put crudely I think we need something like a mass, popular revolt, like the kind we saw in Eastern Europe, a revolt that brought down the old order, without recourse to bloody revolution. But how would the America elite respond to such a revolt? It's difficult to say.

The coming war with Iran will be a kind of test. If that can be stopped, then there is grounds for hope and optimism. Clearly, at present the American elite is deeply split and devided by the catastrophe that is Iraq. This should be an oportunity great change in American society, but it won't be easy to see through without mass mobilization on the streets and something close to a general strike!

Looking at those words again, it seems fanciful and hopelessly romantic to imagine anything like that occuring in the United States anytime soon. Only I don't think anything else will stop an attack on Iran by the current Bush regime, with untold consequences for the the US and the world. What's needed is a revolt to save Democracy in the US, before it's too late. Traditional democracy is in deep trouble at the moment. Bush is ignoring the will of the majority as expressed democratically, and is ruling almost by decree. He has become a de facto dictator in all but name.

Buchco was clever in that they didn't start the draft. People look at the nat'l gaurd as a branch of the miltary. These poeple "signed up" for this to many people. (imo they did not - Irag is not our border).
Bush is in a tighter spot. Starting the draft would end the Iraq campaign and they know it.
I'm starting to think Bushco is very aware of PO and the implications. Somewhere along the line they convinced themeselves they could take Iraq and its oil and the people of Iraq would be grateful to not have Sadam around. They thought they could do it with small ammounts of troups and not have a draft which would have pissed of the voters. I think France, Germany, and many other countries realized this was a mistake before they even started.
IMO Bushco has set the US up for an even harder fall than would have been originally required. Bushco will probably try and bomb thier way out of this. The folly in this is that we will have to change our energy uses if we get thier oil or not. The tremendous resources that will be lost could have been used to build the infastructure that will inevitably be required. This was a wrong turn and a big one. I think thier ego's are to invested for a "sudden rush of brains to the head" they will continue down this path wasting precious time and capital.
Inevitable- It is inevitable that we wil run out(or short) on oil. It is inevitable that the US will need to change its energy useage.
I think history will view Bushco's actions as some of the worst mistake's ever made by the US.
Such a lack of foresight will not reward the US population.

Traditional democracy is in deep trouble at the moment. Bush is ignoring the will of the majority as expressed democratically, and is ruling almost by decree. He has become a de facto dictator in all but name.

Grab yourself a little perspective and calm down. The US isn't even remotely close to a dictatorship right now; indeed, Bush is having great trouble getting anything done.

In the US, a political enemy is called a flip-flopper; in a dictatorship, he's boiled alive, hacked down with a machete, imprisoned, or just shot.

While Bush is nowhere close to being a dictator along the model of a Saddam or a Pol Pot, the US is rapidly headed toward becoming a fascist police state. We've been heading in this direction well before 9-11, but that event gave the right wing elements in the US the excuse to do things that wouldn't have been dreamed possible prior to 9-11. It was a step change.

It appears to me that the UK is a bit further down the road to being a police state than the US, but we are rapidly catching up and will probably surpass the UK.

Here in the US, I think the real test will be whether there is a showdown between Bush and Congress over Iran. If Bush gets away with attacking Iran over threats of impeachment by Congress, and Congress back down (or Bush declares a state of emergency and marshall law), then the point of no return will have been reached.

In a world of chronic and worsening resource shortages and the deep social unrest resulting thereof, it will be next to impossible to preserve personal liberty and basic human rights.

So, while Bush is not a Saddam, I deeply fear for my country, the US.

You might want to go and live for a few years in a fascist (or communist) police state before you make a comment like that. The US is very, very far away from what you fear but haven't experienced, yet.

There will be no showdown over Iran. Congress wants to be re-elected. Bush won't be re-elected. Congress wins. Hands down. And Iran will get its nukes. The only question is if they will ever use them.

There is not going to be a world of chronic and worsening resource shortages, either. There will be a lot of Americans who will grow up, get a grip and start using resources in a responsible way. A carbon and energy tax will help them to grow up faster. There will be a broad, bi-partisan majority for both taxes.

"we are not moving in the right direction at the necessary speed". In Britain at the moment we are not moving in the right direction - period. Last year house price growth was 9.9% and a recent survey showed that most people would be willing to take mortgages of at least 5 times their annual income. The stage is being set for an economic downturn that will take a big proportion of people to disaster, and hence become self-reinforcing. However, I agree that most people and the economy in some form, will survive. In some areas, community-level action is beginning to be seen, like the Transition Towns which have sprouted from one to half a dozen in 6 months.

But there is a long way to go and it is going to be a bumpy ride. The extent to which severe pain can be avoided I think, will depend on the time of peak - is it now or do we have 5 more years for preparation - and how fast the fall from it is - whether demand can be geared down somewhere near in step with supply decline.

As I mentioned above, I think the answers to these questions are crucial and should continue to be key aims of the contributors to TOD. One aspect is the ability of people and groups at all levels to adapt varying according to the time to, and rate of decline. Another is similar to the problems with climate change - politicians will be reluctant to act on uncertain information about what may happen in future.

Reading mostly ToD for about a year has given me the impression that USA needs a kick-in-the-crotch depression to realy start saving energy, using the unique US mobility to move closer to work, shrinking materially inproductive service sectors and prioritizing sound post-peak-oil investments.

I think the big test for your moral values will be how you treat millions of defaulting people and if you can give then a new chance to rebuild their lives or if debt will follow them to their death and thus make them miserable and less productive in building another kind of good times after a depression.

Starting a revolt is probably the dumbest thing you can do. Revolts destroy productivity and makes populations voulnerable to mass murder by competing thugs. But you could picket(?) "More nuclear powerplants now", "Smaller cars are better", "My home welcomes people in need", "less lawyers, more personal responsibility", "Build the future in my back yard", "Bicycling makes you sexy", and so on.

My immediate thoughts are more around how tiny little 9 million pop Sweden where I live will survive the rough seas if large parts of the world financial systems and world trade makes a splash. I think we can do more to prepair and we can probably do enough to be of noticable value for you and other countries during and after such rough times.

The Chinese character for 'crisis' is also the character for 'opportunity'.

I think small, relatively homogeneous nations have a lot higher chance of coming together, and getting through the next bit. A tradition of pragmatic, collective solutions to problems will help, a lot.

I am actually less worried about Peak Oil than most people here (although curious, and willing to be proved wrong).

But Global Warming, I think, is going to be a lot worse than most people imagine, and much sooner.

I see that the peak (all liquids) is about 94 mbd in 2013. What overall decline rate for conventional oil was used to arrive at this number?

I have other questions. This must be a country-by-country bottom-up analysis. If so, as an example, when does Kashagan (Kazakhstan) come onstream and what are its yearly flows from that time forward? Without this kind of data, I am not able to assess how realistic this analysis is. The "gap" is based on 1.8% yearly demand growth relative to the supply as stated above. For example, we may a deepwater peak (across several countries) somewhere between 2011 and 2013, but I still need to do a detailed analysis. Also, how are Nigeria (rebels) or Iraq (civil war) treated in this anlysis? What about future hurricane disruptions? Etc.

It is Saudi Arabia, deepwater and the FSU that has bailed us out up to now. So, I tend to focus on new supply from those areas that have shown an ability to make increases.

Looks to me like Fig 1 is "Conventional plus NGLs" - which is about 94-95 million b/day. Fig 2 adds the other "all liquids" components, many of dubious EROEI. As you say, there are many variables which could impact this but compared to Khebab's recent graphs it look optimistic - indeed for the last 15-18 months the projection in Fig 1 simply does not match recent data. "Data always beats theories".

...while Fig 2 shows "all liquids" reaching 100 mb/d during 2010, just 3 and a bit years from now. !!!

Michael, if you're around to answer questions then I'm attaching mine to Dave's (on topic) comment as some of my questions are the same as Dave's.

This business-as-usual (BAU) growth is depicted, along with a detailed field-based production forecast of ‘usual’ oil, in Figure 1.

Would you like to elaborate on this statement - how exactly is your forecast compiled.

Also, can you give some examples of average decline rates for a range of countries that are past peak?

On efficiencies

Earlier this week Rembrandt had a post on electric wheels

basically implying that new electric car technology with high performance "wanna buy" vehicles may be on their way that have a 1000 km range combined with high performance. Fuel economy may run at a nominal 80 mpg. This is somewhere between 2 to 4 times better than now. Do you not think, therefore, that given high fuel prices and fuel shortages, that petrol / gasoline savings may be much higher than you have indicated?

Demand destruction

My feeling is that demand destruction will be very unevenly spread - would you like to comment?

1000km = 600miles. 80 miles/gallon over 600 miles is 7.5gallons of gas equivalent. 1 gallon of gas = 36kWh of energy content, so 7.5 gallons used at 30% thermodynamic efficiency in a well designed car equals 81kWh. Li polymer batteries have 0.2kWh/kg capacity. In other words, it takes a 400kg Li polymer battery to drive that car that far. That would be a little bit heavy and expensive for my taste, right now. On the other hand, a commuter car which can travel 100 miles between charges needs a battery of only 75kg size and much lower cost. This is a far more realistic scenario for the first generation EVs.

Thanks Euan for inviting Dr. Smith! I'm a big fan of his work.

I've added his forecast (derived from Figure 2) to my monthly compilation and it seems to be very close to the ASPO estimate:

Both Smith and the ASPO are basically forecasting a wall of oil coming on us in 2007 (between 85.5 and 84.5 mbpd for crude oil+NGL). However, production has been flat in 2006 around 81.4 mbpd. I wonder if Smith forecast is rather a productive capacity.

Khebab, I think you are probably right in saying that Smith is forecasting productive capacity - though maybe he will call by to answer this himself. I have repeatedly said that past production = demand, and following this logic future production would be expected to follow the 1.8% per annum demand growth curve ± variations in demand growth. So what he is showing is productive capacity in excess of demand for the next few years. But notably the C+C+NGL volumes are only just above demand. The larger "glut" caused by other liquids is an essential consequence of preparing for shortage - it just ain't possible to switch on alternative liquids when you need them. Interesting to note that by 2025, more than 50% of all iquids are non-conventional.

This is not the first time I have heard about this so-called "wall of oil" coming onstream in 2007. My only problem with this oil tsunami is that I can't find it anywhere I look.

If crude + NGl goes up 3-4 mb/d next year, imagine what the price will fall to, how many SUVs will be bought and what a field day certain "contributors" will have. It would also make it almost impossible to sell the peak oil message for a number of years as people would be expecting the next "wall". Perhaps someone could indeed explain where this and a further 3 years of such increases is supposed to come from?

Actually, I just spent the last 1/2 hour looking for the "wall of oil". I will have to do some more research, but if all of Skrebowsk's 0.05 mbd 2007 projects come onstream without delays — and making generous, unrealistic assumptions about peak production, which in many cases does not happen until 2008 or 2009 — then I get 3.681 mbd of new oil. If I assume a 5% global decline rate for oil (crude + condensate + NGLs), as CERA does, then we need to replace 4.0775 mbd of lost production from the end 2005 EIA number = 81.55 mbd to stay even.

Preliminary checks show that major contributors (non-OPEC) like Brazil and Azerbaijan (East Azeri, ACG Phase 2) are on-schedule. Others, like Vankorskoye (E. Siberia) can't be verified yet but from what little I know, are behind schedule. In Angola, Greater Plutonio (operator: BP) looks good and so do other projects, as I have written about in the past. Within OPEC, 0.8 mbd comes from Saudi Arabia (Khursaniyah onshore).

Anyway, I am still looking for this oil tsunami. I'll issue a full report in a week or so, I think.

Dave - why not ask Dr Smith to explain where he sees the "new capacity". Should add that Rembrandt is working on a Mega Projects update.

I always like to do it myself, but I'll check with Rembrandt and Smith. I'd like to see an accounting in 2007 where we try to measure the amount of new oil brought onstream as closely as possible, compare year-end 2006 and year-end 2007 total numbers, and then calculate a decline rate from this data.

I always like to do it myself,

Dave: I think two independent lines of inquiry would be better then a single combined line of inquiry. Once you have the two reports in hand it may be of considerable interest to see where they were in agreement and, if not in agreement, then why not?

To the best of my knowledge, you and Euan and Khebab and Rembrant and the others are the only ones undertaking this level of work. We owe all of you a debt. Thanks.

Looking forward to your report.

Dr Bob, it strikes me you just don't have a clue what you're talking about. If "crude +NGL goes up 3-4 mb/d next year" - what the Hell does that mean? If production were to rise that much it would mean that demand had risen by around 5% - where do you see that demand comming from?

Perhaps someone could indeed explain where this and a further 3 years of such increases is supposed to come from?

Well now's you're chance to find out. Why don't you string together a few well structured questions for Dr Smith and he may just call by to answer your queries and you may actually learn something

So you think:
* we are 4+ years from peak;
* we are more than 5 years from a true gap between supply (as total productive capacity) and demand;
* KSA has plenty of spare capacity - in order of millions of b/d;
* you think the predictions of westexas and other "peak now" people are absolute rubbish?

You may be right or you may not. It will make life in the next 5 years a lot easier for many millions of people including myself if you are. Presumably, unless all hell breaks loose in Iran/Iraq or OPEC enforces more - genuinely voluntary - production cuts, oil will plunge in price by the end of this year, maybe to less than the dreaded "Yergin" of $38. (Won't he be pleased!). Seriously, CERA et al will make mincemeat of peak oil arguments and it will be very difficult to sell the idea outside the ranks of the already-converted or persuade many to make real preparations for it. So it would be a mixed blessing in the long term.

Anyway, we will have a better idea on Jan 31 2008, when we should be able to see if this oil tsunami really exists.

Your summary is roughly correct. What I have said in the past is 2012±3 years - but as you correctly point out I may or may not be right - no one knows for sure owing to huge gaps in data - especially ME OPEC. I am not alone in holding these views - as I said before, I think the majority of Contributors and Editors here share this view.

I don't think the "peak now" people are talking rubbish, like me, they may or may not be correct. IMO Westexas is beating a drum and is unwilling to take on board counter arguments - see discussion over on Khebabs Mexico post of yesterday.

WRT public perceptions - if we all jumped on the peak now band wagon only to see demand / production rising to 86 mmbpd next year - then the peak oil lobby will be well and truly stuffed. If we are past peak (and we could be) then it is already too late to do anything meaningful by way of mitigation - the oil price will soar when TSHTF.

You can find out more about Smith's assumptions from this presentation on Global Energy Supplies form the free section of the Energyfiles website.

He is definitely forecasting productive capacity - he thinks there will be a surplus of productive capacity until 2013 or 2014, if new sources including biofuels and CTL are included.

His graphs seem to have seem to have Saudi Arabia with a peak capacity of 14 or 15 MBD. He also has great faith in deep water production. There are quite a few graphs - you may be able to glean more insights.

By the way, I cannot get the website reference to work just by copying it in - it seems to be too long, and does not wrap properly when it is pasted in - just runs off the edge. I think this feature needs to be fixed.

Actually, it looks as if he called for the wall to begin arriving jan 2006, with production end 06 around 2-3Mb/d higher than actual. Freddy's punters all expected 06 to be much higher than 05... would be interesting to see what their avg call for 06 production was, and how it compared with actual, which looks to me to be flat over 05. Hey freddy, how about publishing your consensus prediction for 06, 07 and 08, Mb/d? I asked for this before, should be easy for you to work out.

In 07 we will see declines from mexico and sa bite.

We've just added three Models to bring the concensus total to 16 Outlooks. I track monthly/quarterly/annual records to judge conformity of the scenarios to actual data. As u are aware, the only Outlooks that have been refused content in our Scenarios Presentation in that regards are WebHubbleTelescope's Shock Model and Bakhtiari's WOCAP. WHT's ASPO based global Outlook foresaw a 2004 Peak if memory serves me. WOCAP-2003 was invalidated by its 4-mbd shortfall of its 2004 (and since) Supply forecast.

The Scenarios Presentation commenced in Summer 2004, but it was only in December 2006 (and based on a TOD request) that we commenced compiling an AVG.

Concensus for 2008 is 87.5-mbd incl the new Model participants.

This latest version will be released momentarily.

As i mentioned when we discussed the Smith Outlook within the khebab prsenentation, the common denominator of error continues to be wrongful attribution of Saudi Arabian production and assumptions that nations will produce at their MSC. KSA & Saudi Aramco have been definitive and consistent that the target for Saudi Arabia's production 'til 2057 is 10-mbd. Many, including Smith, assume that they will produce at their MSC of 12.5-mbd or beyond. The latter estimates are currently as high as 17-mbd. In his global supply forecast, Smith projects 14.4-mbd from Saudi Arabia.

This has two misleading effects. It results in a forecast Peak Rate that is significantly higher than is the likely reality. And with that comes a more aggressive Post Peak Net Decline Rate in the exhaustion of URR. The KSA desire for a plateau environment will affect and bring about a similar global outcome.

Almost each new Model version release has been reducing their KSA Supply forecast since KSA's vocal objections in 2004 and since.

I'd like to see more detail on the following:

"CTL industry and substantial growth is forecast. But again the amount of growth possible within the next two decades, will hardly impact the gap."

Exactly how much growth do they see as possible? It seems to me that the US in particular could stop building new coal electrical generation plants, and expand CTL dramatically.

This website, , seems to be oriented towards oil and gas supply. I don't see particular expertise outside that area, so the final conclusions of this article seem a bit ambitious.

"In the USA automobile performance could be significantly increased, perhaps approaching European levels by 2025 which also has room for improvement on current trends."

This is remarkably conservative. Should the US choose to do so it could cut light vehicle fuel use in half in 15 years with conventional hybrids, and very likely cut it by 75% in 20 years (and 90% in 25) with serial plug-in hybrids like the Volt. Of course, technically this is fuel switching, not efficiency, but the effect is the same.

I think they grossly underestimate the possibility for fuel consumption reductions in the face of $10 gasoline and $200 oil.

Indeed, there doesn't seem to be any justification for the assertion that CTL growth is limited. It costs about 60 billion in capital for 1 million barrels per day of CTL production which is quite reasonable, and there isn't any shortage of coal for CTL.

I think they grossly underestimate the possibility for fuel consumption reductions in the face of $10 gasoline and $200 oil.

For $200 oil, you approach economic feasability of synthesizing gasoline from limestone and water, so supply can grow arbitrarily also.

CTL and limestone to gas are limited by GW and the political fallout from any one nation destroying earth's atmosphere for everyone. Give unlimited CTL a try if you want to isolate your country completely from the rest of the world.

Limestone to gas is not limited by GW. The byproducts are oxygen and quicklime, and quicklime absorbs CO2; Its carbon neutral.

And CTL is limited by the recoverable coal reserves. At some point it becomes more economical to just turn nuclear power and limestone into gasoline. Climate change will have a price but its far from clear that it will be an unmanageable one or even if it wont be worth using CTL anyways.

So the world will jump on to CTL, climate change or no.

Could you give more info on limestone + electricity = gasoline?

Is this better than other ways of synthesizing hydrocarbons from CO2 and water?

Well, not electricity so much as heat...

You heat calcium carbonate (limestone) to 900 C or so in a reactor (molten salt is most desirable but any gas cooled reactor will do) and you collect the that is driven off by lime burning CO2. You have another reactor complex where you do thermochemical hydrogen production from water, say sulfer iodine processes, or use high temperature electrolysis. Then you mix them both over cobalt catalysts and get diesel fuel. You can do the same sorta thing to go from syngas to methanol and them methanol to gasoline.

And I dont know if there are better ways of synthesizing hydrocarbons from CO2 and water, but its the most obvious I can see given how damned much limestone there is in the world and how the calcium oxide absorbs CO2 from the atmosphere. Its an illustration of what is possible, and then we can make guesstimates on the infrastructure requirements for abandoning fossil fuels while still using liquid fuel. I'll think about how much it would cost in capital for a million barrels a day of limestone diesel... I'm guessing 60 billion for the basic FT plant because thats the same as CTL. At least 90 billion for the hydrogen production reactors plus 30 billion for the limeburning reactors... but those are just pulled out of thin air since I think you'd need about 90 gigawatts thermal for the hydrogen production and significantly less for lime burning.

I agree, but:

1) that's not what Smith hung his hat on - he said it couldn't be scaled quickly, and I'm curious why he said that,

2) China is hellbent on doing CTL, and a number of countries use as much coal for generation as is convenient and/or economic, so we wouldn't be alone, and

3) I think there are much better alternatives, but I think it's unlikely that we would not use it as a last resort. That converts into a GW problem, not a peak energy problem.

He said it for the same reason that (foolish) people say the world will have 100 billion people eventually. See two data points, connect line, project line into the FAR future, voila, insanity! Works every time.

Inertia is no significant barrier to any process over the course of decades. The internet went from a couple of mail servers on universities to a globe spanning necessity in less than 10 years, think about that for a minute. How much did that cost, and much of the technology for it didn't even exist at the outset. You could compare it to the manhattan project (what was that, maybe 5 years from concept to bomb?), or the apollo missions. None of these things took 20+ years, and all of them had to invent technologies at the very edge of feasibility from whole cloth. Most of the technologies contemplated for energy are well understood. It's known in advance that they will work, and even known (approximately) how much they'll cost and what the sideeffects will be. If they are cost effective, and technically feasible, then inertia alone won't stop them. Same reason I don't think the nuclear industry will take until 2020 to get moving again. When it becomes cost effective, it'll happen, and not before. Past projections just aren't useful here.

Tremendously great work that Energyfile is doing, clear cut. Im wondering though what the assumptions are behind the coal to liquids/gas to liquids/biofuel to liquids/bio-ethanol and biodiesel production numbers. Also a tip would be to take a look at bio-methanol production

Demand Destruction

A good deal of demand destruction could as well be called creative destruction. Almost every time a city has lost a major auto thoroughfare some 30% of trips simply disappear. Unlike years past when I explored a heat pump and companies insisted upon oversizing them, this last summer both bidders were comfortable that I do NOT want to heat my whole house to 72 degrees, and in fact close to 40% doesn't need to be heated at all - even in 25 degree weather.

Sorry I could not post earlier. There are a number of points here. Firstly for your information there is a fuller version of my paper published by the Energy Institute’s Petroleum Review this month.

My forecasts try to be realistic. Unfortunately I get criticism for being both optimistic and pessimistic; depending on who is doing the criticism. I can’t tell you who is right. It is in our nature to be biased and Energyfiles is a commercial organisation like CERA etc. But my tag line is “facts not assertions” and I encourage criticism.

The forecast in Figure 1 is a bottom-up analysis by field where possible, so I do not have an overall decline rate. This is very variable as geology and development strategies are variable but it would seem to be around 5% onshore and 15% offshore for producing fields with yet-to-find and yet-to-develop oil reducing these rates depending what I estimate to remain (based on past success and geology). Dave: For Kashagan I use the latest ENI forecast, coming onstream in 2009 and ramping up to 1.2 mm per day by 2015. My deep water peak (400 metres/305m in US) falls around 2020 at 11 mm bbls per day, there is still a lot of ultra-deep potential left. I think. I assume both Nigeria and Iraq carry on business as usual despite unrest with Iraq producing 4.3 mm bbls per day by 2015. Any comments on these would be appreciated. Euan: Note that figure 2 begins at 60,000 bbls per day so 50% is not unconventional in 2025. I suspect my new capacity is in the same places as everyone else; in Caspian, Sakhalin, deep west Africa, Angola, GOM and Saudi Arabia. Next time I will prepare a chart showing this in more detail.

My forecasts are now built around potential future production capacity (and I should have mentioned that in the text, thank you for pointing it out) although I do try to update historically as soon as I can (“data beats theories”). Figure 2 is what could happen if everything went right (or wrong depending on how you look at it), mostly based on forecasts from the experts in each field. I used to attempt to predict OPEC restrictions etc (in my earlier World Oil Supply Report) and give a range of demand driven forecasts but my strengths are in understanding geology and engineering of global fields and thought it better to leave the politics out. Especially as my clients want to know what to build, when and where and there are so many other local and global uncertainties (wars, sanctions, terrorism, environmental issues, natural disasters, speculation, anti-globalisation, nationalisation, global pandemics) which could lower the “so-called wall of oil.” I decided that geological and engineering variables were fundamental. Capacity really controls price and then price controls policies. By the way I do not see a wall of oil myself more an Offa’s Dyke, for people who know UK geography. Temporary oil price reductions will soon spur on demand in Asia, OPEC will restrict output and disasters will happen.

The comments about population are all correct and I am sure you know the figures. Forecast reductions in population would help but not soon enough (except through world wars and/or disease/starvation). The efficiency forecasts are based on growth in demand partly due to population growth and partly due to economic growth. They are very simplistic and incorporate most of the recommendations made in the comments here. I realise I am not an expert on this one, but have not seen anyone who can provide a full picture. Of course the US could do lots more to conserve fuel but I have tried to be realistic about what they may actually do based on the prevailing oil price. For example if the US saved more oil, the price would drop and China would grow faster.

And CTL potential is huge but consider the time it will take to bring it onstream not just the volumes available. My CTL forecast is based on the Chinese own. We are not talking about decades here (slaphappy), investment in large-scale industries (not ridiculous comparisons with Apollo) takes time as the Chinese government knows, and if anyone could do it they could. I don’t know why people use pseudonyms, but this one is appropriate.

The critical points are firstly all the options here could potentially be done and still maintain the world as a “comfortable” place to live in, preserving our quality of life and secondly they are not enough. In truth most probably global efficiencies will be limited unless the UN forces orderly demand destruction for environmental reasons. Thus the gap can only be filled by conservation, involving competition for resources and changes in life style; mostly for the worse (as mentioned in the thread for Zimbabwe, debt implications, high carbon taxes etc.).

Thanks for your response. I will need to look at your more detailed report in the Petroleum Review.

Based on what I know, there will be little spare capacity in future years. I have written about Jack #2 (ultra-deepwater) and have noted in the past that CERA already counts 0.8 mbd of productive capacity for the lower Tertiary Wilcox play in the Gulf. I can't make sense of this. Either

  1. These fields will be in production, given the huge CAPEX required
  2. They will not
So, I don't see how productive capacity makes any sense in this context. Since I don't believe that many of these fields will actually get produced — unless the oil price is very high and technological obstacles can be overcome — I can not agree about any accounting method associating some N mbd of capacity for ultra-deepwater.

Moreover, Kashagan is now further delayed to 2010, but this may be optimistic. Deepwater decline rates in existing fields are indeed high, and if we trim our expectations about the ultra-deepwater developments, the deepwater peak will surely be much sooner than 2020. I doubt the world will ever see more than about 8 mbd from all deepwater developments (GOM, Brazil, North Sea, Malaysia, West Africa). I need to research and post on this, as I said.

Now, Michael, even you must admit that Iraq at 4.3 mbd is a bit of wishful thinking. Nigeria is a mess. MEND could shut down over 1 mbd of production there anytime they want. My approach on this and similar matters is to always err on the side of caution, not the other way. Societies must plan based on Murphy's Law and, if things turn out better, that's all for the best.

regards, Dave

I tend to agree with your either/or scenario about productive capacity. However my view is that deeper fields will be progressively produced over the next 15 years and that an 8mm bopd peak is rather pessimistic (indeed a few years ago I forecast around 8.5 but have changed my opinion). We cannot really know for sure although deep water technology does continue to advance apace. Nevertheless this has little effect on the peak; only on the post peak decline rate. A one or two year delay on Kashagan does not make a material difference either. I have done sensitivites on many of these large fields and it is surprising how insensitive the model is. Of course if everything goes wrong (or conversely everything goes right) then the peak does move a few years one way or the other but these are unlikely cases.

Now Dave, Iraq could reach 4.3 mm bopd by 2015. In fact it could do so earlier (and also later). My view is that this is the most likely case (without wishful thinking). Of course I know I will be wrong - the error bars are huge, and it will be politically, not technologically led. Also if Nigeria shut down 1 mm bpd of production then OPEC would cease restricting output. I know all this is speculation but my most likely scenario is that Nigeria would not let that happen - they need the income. Finally I think planning on Murphy's Law is just as misguided as planning on utopia - both lead to wrong decisions and a waste of investment capital. I do not err on the side of caution (or hope) but I fully realise there is a need for your approach (to create a balance to CERA for example) in the real world.
Best wishes

" Of course the US could do lots more to conserve fuel but I have tried to be realistic about what they may actually do based on the prevailing oil price. For example if the US saved more oil, the price would drop and China would grow faster. "

I read that as saying that there is a price barrier: a point at which the US would reduce their demand sufficiently (via efficiencies and alternatives) to keep prices from rising further. Am I right in that interpretation of what you're saying? I think that makes sense, and I would estimate that price at around $100/barrel. Would you agree?

"The critical points are firstly all the options here could potentially be done and still maintain the world as a “comfortable” place to live in, preserving our quality of life and secondly they are not enough. In truth most probably global efficiencies will be limited unless the UN forces orderly demand destruction for environmental reasons. "

I read that as saying that global warming is a bigger problem than peak oil. In other words, we can cope with peak oil with efficiencies and alternatives, but due to GW that we need to reduce fossil fuel faster than we would if we were just coping with peak oil. Do I understand you correctly?

Finally, I believe you are saying that the fossil fuel reductions needed to cope with GW will be difficult to do with efficiencies and alternatives, that conservation & lifestyle change will likely be needed to handle that. Do I understand that correctly?

1. Yes but I have no analysis to decide on the price barrier. There was some movement last year at $70 so I suppose $100 would be realistic.
2. Global warming will be a bigger problem, but peak oil will be the first to truly hit home. However it really all lies in perceptions before the event and currently global warming is having a much greater influence on public attitudes (and hence politics) whilst peak oil won't really influence conservation policies until the next permanent oil price jump in 2 or 3 years time.
3. I was not intending to say that but of course you are right. Most viable alternatives are more damaging although depletion of oil and gas will soon begin to reduce carbon production from these sources. What I was actually trying to say was that the most successful pressures to reduce the use of fossil fuels have come from the environmental lobby not the energy security lobby.

IMO, bottom up analyses are fine as long as region/world existing field decline rate is known. However, we are seeing dramatic reductions in output from mexico and sa. Regarding the latter:
1 They are trying hard. Rig count up 3x in 2 years... unprecedented in the kingdom. And, their evolving stated plan now is to go up 8x, to 130. Has the look to me of blind panic. At one time sa wells produced thousands of b/d - well, maybe they still do, but imo more water than oil.
2. THeir latest statement is that production is down 1Mb/d from one year ago, to "around 8.5Mb/d." Presumably, if their capacity was higher, say 9Mb/d, they could simply say "we are more than meeting opec cuts because our position requires we do more, and production will be 8.5Mb/d until further notice." By saying around 8.5 no one need be surprised if actual production is somewhat less.
3. Their practice of going to expensive horizontal wells is a great way to maintain production as rising water gets close to the gas cap, but always presages catastrophic collapse when the two meet, at which point it is time to produce the gas.

Thinking that sa is going to increase output is an act of faith, based on people known to be biased saying "trust me." BTW, these same people said "we want lower prices" and "there are no buyers for our oil" last spring/early summer as their production declined and prices surged towards an all time record.

Looking at the larger view, it is not a coincidence that cantarell and the persian gulf giants are nearing the end of their productive lives simultaneously; all are very old, all have been hitting the horizontal viagra bottle, and their ends are near. Meanwhile, neither region has any new fields even found, much less under development... sa speaks of successful development of fields long abandoned. Regarding new production from the gom, none of the us gom rigs are even looking for oil; all are drilling for ng, and we are anyway losing rigs rapidly as sa poaches rigs from our gulf to drill in theirs.

Iraq is of course a biq question. It is hard to see that the minority sunnis will ever accept domination by the shias. Think of the arab/israeli conflict, or northern ireland; it will take years, maybe decades, of conflict before the two sides are so sick of the lack of peace that they will make the concessions necessary to bring it about. IMO iraq will prserve its treasure until years after peak, and there is no assurance that the fields will not be further damaged in the interim.

Regarding Iran, there are signs that rapid decline is approaching fast. Meanwhile, kuwait has acknolwedged that burgan is in decline... I assume that this old field has also resroted to horizontal wells, but don't know. And, China has stated that daqing is also now declining.

I suggest, as an exercise, adjusting your bottom up analysis by assuming that mexico, all persian gulf, and gom all decline at about 10%/year.

Finally, your prediction, just like Chirs', expected that end 06 production would be 2-3Mb/d higher than it is. What went wrong? Did some fields you assumed would be on line in 06 not start on time? In this case, perhaps it would be good to assume that scheduled start ups, in this period where there are not enough rigs to go around, will mostly be late. OTOH, if the projects and their production came on line as you expected, then it would seem that the only thing left is higher declines than you expected (and presumably you have the data to back out what this higher decline rate is, something I have asked freddy for). In this case, it is probably not enough to adjust your 07 forecast to the 06 decline rate; probably better to assume that every year the rate will increase, just as it must have done from 05 to 06.

The flat 06 production of course has absolutely nothing to do with supply (productive capacity) but everything to do with demand - high prices have suppressed demand - whilst stimulating exploration and production spend - though not so much activity as most of the money has gone into the coffers of Schlumberger and Baker.

The flat 06 production of course has absolutely nothing to do with supply (productive capacity) but everything to do with demand . . .

Perhaps. But if supply isn't really there, it has everything to do with supply. It is interesting that six out of the eight largest oil producers are showing declining production in 2006 ( Saudi Arabia, Russia, United States, Iran, Norway, and Venezuela). Of the remaining two of the top eight, China has announced oil production will be lower in 2007. That leaves Russia. I sure hope their production does well in 2007!

Yes, careful not to mention the 1mmbpd BTC pipeline, Angola and Brazil - you gotta look at both sides of the coin. I still believe that the KSA decline in production is voluntary as stated - they're making way for all that new supply from other areas like they have done for as long as I can remember.

Euan, u are ofcourse correct. Upon attaining the world supply record in July of 86.13-mbd, it was almost immediately discoverd that 1.9-mbd was surplus and taken up at bargain rates for inventories around the world. That realization brought upon us the present regime.

Now in Jan/Feb we face a similar Demand Call, but this one does not have its foundation on speculation and perceived Demand and the price is justifiabley climbing with OPEC unable to deliver on its end due to its attempts at pricing maniplation.

I think discussions on the relative merits of one another’s forecasts is rather fruitless by email. I am sure I have lots of individual forecasts wrong, but hope that the overall picture is in the ball park. The point of the paper was to demonstrate a point to non-scientists who do not use data to back up assertions – but you are (mostly?) scientists. I did have significant decline for Cantarell for example but perhaps overestimated growth in some other Mexican fields that partly compensated. In 2006 OPEC (SA) did begin to restrict output again (of largely heavier oil) and remember I include a notional refinery gain which will depend on demand for products.

However, being a pragmatist I agree with everyone’s comments where they discuss specific issues (especially those last few above) and admittedly I am more likely to have been forecasting higher developed capacity values than actual produced volumes because I take little account of political and other one-off events before they happen (eg Thunder Horse). And in particular the effect of increased nationalism may have a significant effect on investment levels in capacity, especially in Latin America. Thanks for all the constructive comments, I will be taking everything into account as my work in progress proceeds.
Best wishes

Freddy - I guess you would agree that pre-peak, forecasters need to forecast demand. Demand is moderated by price and price is moderated in very general terms by surplus supply capacity and where that suplus resides. Much of it resides in KSA who as you point out further up the thread will continue to produce at below capacity.

One thing that Michael's work shows is that suplus conventional oil capacity is very tight in the years ahead and it is only the expanding non-conventional liquids that provide a comfortable cussion. Michael indicates around 5 mmbpd surplus, and assuming the non-conventionals get consumed, then we will have around 5 mmbpd of conserved conventional - and this will need to be added to the down curve - conserving conventional supply for the future - which is what you said KSA will do.