We'll run out of beer before we run out of oil

Today's story is about beer, and about the unexpected consequences that the combined energy and global warming crises have on its price, but it also more generally about the unpredictable links we find between apparently unrelated issues as we push the limits on the exploitation of the earth's resources.

The immediate story is this:

Blow for beer as biofuels clean out barley

The rapid expansion of biofuel production may be welcome news for environmentalists but for the world's beer drinkers it could be a different story.

Strong demand for biofuel feedstocks such as corn, soyabeans and rapeseed is encouraging farmers to plant these crops instead of grains like barley, driving up prices.

Jean-François van Boxmeer, chief executive of Heineken the Dutch brewer, warned last week that the expansion of the biofuel sector was beginning to cause a "structural shift" in European and US agricultural markets.

One consequence, he said, could be a long-term shift upwards in the price of beer. Barley and hops account for about 7-8 per cent of brewing costs.


"In the US, land that was cultivated for growing barley has been given over to corn because of the ethanol demand," said Levin Flake, a grains trade analyst at the US department of agriculture.

The biofuels boom, motivated by a combination of subsidies and regulation, is already creating plenty of problems while doing very little to solve the underlying issue, our gas-guzzling habits...

Ethanol is now required as a fuel additive in the USA as a substitute to MBTE, an additive that was found to be noxious; it is also seen as a home-grown substitute for gas produced from oil, and a renewable one at that, thus helping to solve two problems in one go: dependency on Middle Eastern oil, and carbon emissions.

The problems with that approach are numerous. The first one, endlessly discussed, is that biofuels provide a pretty weak substitute for oil, as their production (at least for so-called 'first generation' biofuels such as those made from corn) still requires a lot of oil in the context of our current energy-intensive agriculture. The second, which is slowly emerging, is the ripple effects that the rapid switch to biofuels is creating in other sectors, starting with the impact on corn prices (as demand for the crop skyrockets), and continuing with similar consequences on other crops that are now being displaced by corn as farmers try to take advantage of higher prices.

What we are seeing is what appears to be increasingly desperate efforts by our industrial model to switch from one input to another as shortages appear - and propagate, and we keep on discovering new bottlenecks.

Resource scarcity is spreading, and the looming shortages implied in these skyrocketing prices suggest with increasing force that we are really going to need to start thinking about the demand side of the equation, instead of always looking for new solutions on the offer side. All our resources are at stake, and it's simply not going to be easy to reduce demand for one by finding substitutes - we're going to have to learn to do with less of *everything*, soon.

:: ::

In this context, KKR's announcement that it was purchasing TXU for a record $44 bn (in the largest private equity deal ever) comes with an interesting twist, and a highly relevant one here:

How Green Green-Lighted the TXU Deal

It's a turn of events in a bitter feud between environmentalists and the highly profitable Texas utility giant that no one could have predicted.

Until two weeks ago, representatives from the Environmental Defense and the Natural Resources Defense Council (NRDC) thought they were in for a long, drawn out battle with TXU over its unprecedented $10 billion plan to build 11 coal-fired plants in Texas. The plants would have more than doubled the amount of carbon dioxide the company sends into the atmosphere. Indeed, TXU's plans had turned into a national referendum on coal-generated electricity. City mayors, business and religious leaders, and the state of Oklahoma joined forces with the environmentalists to fight the project.

But instead of fighting, the environmental groups helped to broker a deal with the private equity groups, sharply reducing the number of coal-fired plants to be built in Texas. Given the fierce resistance to TXU's plans, the private equity firms had decided that they would only go ahead with their takeover bid if they had buy-in from environmentalists and could work to turn TXU into a leader on environmental issues. That led to William Reilly, a longtime conservationist-turned-private equity investor at Texas Pacific Group, to reach out to environmental groups and get them involved in working out a deal under the type of deadline more common to boardrooms than environmental meetings.


But Reilly and his other private equity partners didn't want to go ahead without an agreement from the environmental groups to pull back their opposition and support the buyout. "Smart money knows that global warming is real and that a sophisticated approach to this is good business," says David Hawkins, one of the negotiators for the environmental groups.

What this means is another linkage in that tale - that of Wall Street big money with "greenery". One of the reasons for the skyrocketing corn and other related crop prices is the sheer amount that has poured into the sector in record time, lead by private funds and private equity firms who are seeing great opportunities to make money in fast growing sectors with a good image. They are investing massively in all sorts of new technologies, from wind to solar to various carbon sequestration or compensation mechanisms, and are helping develop the industry at record speed.

While this is obviously a good thing, and it is helping the renewable energy sector grow and be taken seriously (and it is helping the traditional energy sector shed its most polluting practices, as in the case of TXU above), it is also ensuring that other bottlenecks are being reached increasingly fast.

Fundamentally, the muscle of the financial firms in that sector is still focusing on improving the offer side of the equation. It's great, but it's not enough. We need to find smart ways to reduce our consumption of energy, or we'll end up running out of beer before we run out of fuel in our desperate quest for endlessly available energy.

Hit reddit, hit digg, hit your favorite link farm! :)

Peak Oil was all fun and good, but now, THIS IS GETTING SERIOUS.

At least beer is pretty easy to make, the ingredients aren't hard to grow one's self, and there are a lot of microbreweries here out West.

Also, it seems like something high on the list of priorities. Now I'm really against biofuels though.

Irony is... we could all become Muslims and eschew alcohol. Wait a minute... they just eschew alcohol in public.

Or, better, we could become Mormons. But then you know the joke about taking a Mormon fishing with you. Better take two Mormons fishing with you, otherwise the single Mormon will drink all your beer:)

No! No! Not the Beer! What about Wheat? Wheat beer is good. Are there alternative crops that we can use to make beer? Perhaps we should begin now in investing in alternative ingredients for beer. Does anyone know of any research in this area? Post-Beer would be more than I could take. Does anyone know when we might reach Peak Beer?

Some of us homebrewers would consider your statement about using alternative crops for beer a sacrilege.


The way it has always been and always will be.

We are coming up on the time to purchase hops rhizomes (first few weeks of March) if anyone is interested in growing their own.

I would take a pint of double-IPA over a free tank of gasoline anyday...


You can make beer out of any darn grain you want.

Don't limit yourself, there's lots of great beers made from lots of different grains (heck, I've seen milk beer even).

I'm a homebrewer my self as well. I'll brew anything (once anyway).

Seriously, do you you have a recipe for self-sufficient post-oil beer. I really would like to be able to make my own beer when you can no longer go to the store to buy beer or it's ingredients.

I once made a beer completely from sprouted wheat berries. But it is a fair amount of work and the resulting brew was definitely an acquired taste.

However, should circumstances demand it, I'm sure I'd acquire that taste.

To make beer from barley or wheat from scratch requires knowledge of a process rather than a recipe. You are manufacturing something. Equipment to grind and cook grains is required.

Basic idea: sprout grain, roast grain, grind grain, cook grain, ferment grain, bottle liquid.

Ok, so I grow a grain, get it to sprout. Roasting it should not be a problem. Grind it in a stone depression with a rock. Boil it to make the Wort. What about yeast?
How do we induce fermentation if we can't buy yeast?

It will ferment on its own. The yeast naturally occur on the grain.

People use commerical yeasts in order to get a more controlled and complete fermentation.

At least for barley and wheat, the cooking part is not particularly simple. You don't boil it. At least not at first. Instead it's heated to a certain temperature in order to encourage the conversion of starches into sugars.

Here's a great article: beer making at it's most basic as the ancients did it.


The author suggests that there is a symbiotic relationship between beer making and bread making. i.e. You use the yeast produced in the brewing process to make bread rise.

I've tried it, and it most definitely works. The bread has a wonderful mild beery flavour that doesn't seem out of place at all.

About 30 years ago, in what was then Zaire near the borders of Uganda and Sudan, I came upon a bunch of boys whooping it up at the local saloon. Actually, it was a few sickly looking locals hanging around a mud hut with thatched roof.

I don't know how ancient the recipe was, but there was little evidence of barley. I tried some. My stomach never recovered.

Give me the IPA.

Farmers in the US used to homebrew as a matter of course.

Making beer the old fashion way is easy. Get some barely. Soak it in water and let it dry (malt the grain). Crush it. Soak it in hot water for an hour (mash the grain). Remove the grain and boil the grain soup with hops (these grow like weeds on a vine). Let it cool. Add some yeast. Let it sit for 2 weeks. Bottle/keg it. Enjoy.
Check out this book. It has a chapter on self sufficient post oil beer

Modern Home brewing is even easier. Get a can of malt. Boil it with some hops from the store. Let it cool. Add yeast. Wait two weeks. Bottle/keg. Enjoy

But I sure hope the world never gets to the point where you can't go to the store and buy beer (or even the ingredients for it). We'd be in for a world of hurt that even a cold glass of suds wouldn't fix.

There's another good point. Refridgeration or ice, how do we do that post-oil. I know they drink it warm in Europe, but I'ld rather not if I don't have to.

cellar temperatures.

Lagers come from Germany and are served/fermented colder because their basements are colder.

Ales come from England and are served/fermented warmer cause their basements are warmer.

This ice cold beer idea is an American invention. The colder a beer is the less you taste it. And with American pale lagers, that's what you need to do.

But if you're hard up, beer is about the hardest alcoholic drink you can make. Colonial Americans drank rum and hard cider which are really much easier to make. Americans didn't start drinking beer until the mid 19th century when German immigrants brought it with them.

Making cider is easy. Get some apple juice and let it sit out in the open un capped. Wait a couple of weeks. Enjoy.

Check out the book "A self sufficient life" I linked above. The author covers all these things (albeit a little briefly).

Making cider is easy. Get some apple juice and let it sit out in the open un capped. Wait a couple of weeks. Enjoy.

At last, sense. Cidre is most pleasant and more than suitably intoxicating. Perfect with food, ideal with pudding. Not to mention the countless pints one can consume with mates in the local.

From scrumpy to that Frenchy sweet and bubbly stuff, it has a range beer can only envy.

I made 10 gallons for the first time this year. Bottled first batch 2 weeks ago. smuuuck! WOW was it tart. Seems the yeast ate all the sugar. 0% sugar content, 12 % alcohol, had to add concentrated apple juice to sweeten it back up.

It is easy! Wash, grind and press your apples. Put the juice in a carboy and add a fermentation lock(I added some sugar but not required). It's worth the money to buy both a sugar meter and a alcohol meter. They will answer your questions.

Helpful website (sells stills too). http://www.mainbrew.com/ make your own ethanol(hic!)


I learned how to make both cider and beer this year. Cider is much easier to make. Use apples or pears. I would say that making really good cider is not so easy though. My home made beers tasted really good, comparable to a good microbrew, but the ciders were not of the same quality as store bought hard ciders.

There's a book by Jessica Prentice called Full Moon Feast that compares different kinds of beers from around the world. She actually does this for all sorts of food processes, including bread making. Anyhow, not only are different grains used, but different flavorings. In old Europe all kinds of herbs were added to flavor beer. For some reason a German law was eventually made saying it had to be hops. Ancient libertarians and anarchists were aghast.

If you want to sprout your own grains (malting) study carefully what this means and how to do it. YOu are not waiting for the grain to actually start making new leaves, only for the process of starch converting to sugar inside the grain. You can't SEE this happen. Must use water, heat and known timing, perhaps taste, to know when the process needs to be stopped by roasting.

Making wort requires a temperature of about 150 F, too hot and the chemistry isn't quite right, though the process isn't all that finicky.

From scrumpy to that Frenchy sweet and bubbly stuff, it has a range beer can only envy.

You obviously haven't been to Belgium yet.

When I lived in Michigan there was the place called the Cadieux Cafe in Detroit where they offered every Belgian Beer they could get their hands on.(They also had feather bowling which is an enormous amount of fun.) The Belgians sure are prolific in varied beer production! (I don't know if Cadieux Cafe is still there or not, but definitely worth it if you live near there. They also have a restaurant where they feature buckets of steamed mussels.)

Just looked on the Web. They are still there, and apparently have ghosts!



thank you for summing it up. as a homebrewer, which is easy, i thank you for explaining to the masses the simplicity. it's really very easy to homebrew! i encourage everyone to get into homebrewing. do you happen to have George Washington's recipe for homebrew? i doubt it's a wimpy 3% 0r 5% brew!

Making beer and wine post-peak will be even more important than it is now if society collapses to the point that the ingredients can no longer be found in a grocery store. The ancients used to make a lot of beer and wine bc/ without modern methods it was difficult to keep the water supply clean. Beer and wine keep for years without the risk of water-borne illness. This advice is even found in the Bible (1 Timothy 5:23) when Paul encourages Timothy to "drink no longer water, but use a little wine for thy stomach's sake and thine often infirmities".

At least, good wine grapes seem to grow on much different sites than grains. And I doubt that anyone would seriously want to use grapes for ethanol. It would take about 36 bottles of wine to make a gallon of ethanol.

Will Barley and Hops grow in Texas? What about Yeast? Is there a way to grow your own yeast? Are there alternative communities forming in order to survive Post-Beer?

My REDDIT post:

Beerdrinkers of the World Unite! Hoisting your brew when it reaches half-empty to shout out Peakoil is a new cultural tradition I have been trying to promote for some time. This article on crop-shifting for ethanol really drives home the importance of Peakoil affecting PeakBEER.

Will "The Nectar of the Gods" become so constrained that we will cry in our beers?

Bob Shaw in Phx,Az Are Humans Smarter than Yeast?

"Are there alternative crops that we can use to make beer?"

Cellulosic Beer?


It's a sad time for the world when fuel tanks have to compete against stomachs for agricultural land! This will force up the prices of barley, corn and other land based food sources.

Crude oil and lease condensate production rates are probably in decline now. As the demand for total liquids continues to increase, agricultural land is needed to produce biofuel liquids. Food crops are competing with biofuel crops for arable land.

The updated charts below show that the demand for biofuels and competition for arable land will increase until significant demand destruction occurs.

Update of Project Production Based Total Liquids Forecast to 2011

Based on my forecasts below, we are already on a peak total liquids production plateau. If Saudi Arabia’s current spare production capacity is a lie, then crude oil and condensate production is in decline now.

These forecasts have been updated using Chris Skrebowski’s Feb 2007 Petroleum Review megaprojects database. http://www.energyinst.org.uk/index.cfm?PageID=13

His new database includes megaprojects producing at peak 40,000 barrels/day crude oil and other liquids.

The first chart shows forecast crude oil and condensate (C&C) to 2011 with a decline rate of -0.5%/year. This decline rate is forecast because increased production from Angola, Azerbaijan, Brazil, Canada (tar), Kazakhstan and Nigeria will not be enough to offset declining production from the rest of the world.

The next chart shows natural gas plant liquids and gas to liquids production to 2011. The production rate increase is 3.5%/year. This production increase is due mainly to these projects: Saudi Arabia Khursaniyah & Hawiyah NGPL; Qatar Ras Gas & Qatargas NGPL; and Qatar, Nigeria & Colombia GTL.

A weighted average of the C&C decline rate of -0.5%/year and the NGPL/GTL increase rate 3.5%/year gives a total liquids decline rate of -0.1%/year. The demand increase is 1.8%/yr based partly on the Feb 2007 IEA monthly market report. http://omrpublic.iea.org/currentissues/full.pdf
The -0.1% decline rate was applied to total liquids supply to 2011. The last chart shows a significant supply demand gap starting in October 2007 causing oil prices to increase.

Chris Skrebowski said in the last paragraph of his updated Feb 2007 Megaprojects Database article ”It is only possible to draw two conclusions from this latest megaprojects analysis. First, data on production, project performance and depletion rates is wholly unsatisfactory, particularly for the OPEC producers. Second, the large volumes of new capacity being added between 2007 and 2012 may not translate into the sort of increased production flows the world economy needs to underpin economic growth.”

If food prices continue to increase due to total liquids competition then demand destruction will happen either by high prices, government rationing or world population decline.

Can I ask a naive question? How can demand exceed supply as shown in the forecast? After the small excess inventories are burned up and we're living on the daily production, doesn't demand have to average less than or equal to supply?

I'm asking because I imagine that price enters the demand-supply equation somehow. If oil had averaged $35 a barrel in 2006, I suspect demand would have been higher than it was. I can understand the notion that the demand curve might represent business as usual. However, looking at the little fluctuations about zero of the 'gap' line in the second figure in the period up to the forecast date, doesn't the future gap have to look pretty much the same as the past one?

You are right that demand cannot exceed supply. However, most economists and EIA/IEA/OPEC publish world demand growth forecasts.

If the forecast supply cannot meet demand then the price increases to force the demand to be roughly equal to the supply capacity.

If the forecast supply was equal to forecast demand then the price would stay roughly the same in real terms.

Ace, I want to thank you for the excellent information you provided in response to my question three days ago regarding long term oil supply contracts.

Hello Ace,

Thxs for your hard work on these charts. My guess is that you are increasingly leaning towards the conclusions of the Deffeyes Group [Simmons, WT, Darwinian]--Is this correct? What is your 'confidence window' until the 'rear view mirror' decisively proves your point of being postPeak?

I can't recall any specifics from the Deffeyes group, but I surmise they expect to be vindicated by C+C data in a
2005-2010 'confidence window'. Thxs for any reply.

Bob Shaw in Phx,Az Are Humans Smarter than Yeast?

Hi Bob,

Yes I am in agreement with the Deffeyes group. A significant problem is still the poor quality and unaudited reserves/production data used as inputs to forecasting models.

The confidence window end date will be determined by Saudi Arabia's capacity to produce more when required. This end date could be late 2007/early 2008.

Table 2 of the Feb 13, 2007 IEA Oil Market Report forecasts total world liquids demand for 4Q2007 to be 87.4 million barrels/day. Table 3 shows actual total world liquids production to be 85.5 million barrels/day for Jan 2007. That means that the world needs to produce almost 2 million barrels/day more to meet 4Q2007 demand.

Saudi Arabia is probably the only producer that could supply this increased demand as its spare capacity is claimed to be 1.7 to 2.2 million barrels/day:

If there are hurricanes in the Gulf of Mexico followed by a cold 2007/08 winter and Saudi Arabia cannot increase their production then there should be a high confidence level that the peak in C&C production has passed.

The 'confidence window' for total liquids is unclear at this time.

That we are on a plateau and will decline from it before long, is a conclusion I reached sometime last year and was confirmed for me by Khebab's recent article:


I'd previously guessed third-quarter 2008 as the time when real trouble would begin, but according ace's analysis this looks optimistic.

Also, as for the impact on beer, it holds just as well for most basic foodstuffs. There's also the impact of droughts - possibly aggravated by global warming - to consider. To westexas's famous "economise, localise, produce", I would add that all TODers should take a look at their back gardens (or "yards" as many will know them) and think about what food stuffs they could grow for their own families.

If you do a decent job of gardening, you could produce about 5 lbs of barley (or wheat, oats, rye) for every 100 sq ft of space in your garden.

If you have a pretty good size yard, you might have a 1000 sq ft garden.

If all 1000 sq ft are used for small grains and they grow pretty well, a yield of 50 lbs of small grains would be about 1/9th of one person's annual small grain budget.

You could also make a really big batch of beer with these 50 lbs, enough for a nice kegger party, but that would be it!

I do grow grains in my backyard garden and eat some of them, adding barley to stews, but for the most part I use them to feed a few hens. The small grains are important for making straw, which is needed for good compost, and they are a nice cover crop during the winter months.

If there are hurricanes in the Gulf of Mexico followed by a cold 2007/08 winter and Saudi Arabia cannot increase their production then there should be a high confidence level that the peak in C&C production has passed.

From Wikipedia on El Nino: "In North America, typically, winters are warmer than normal in the upper Midwest states, the Northeast, and Canada, while central and southern California, northwest Mexico and the southwestern U.S., are wetter and cooler than normal." and

"El Niño is associated with decreased hurricane activity in the Atlantic, especially south of 25º N; this reduction is largely due to stronger wind shear over the tropics."

The most recent National Weather Service Climate Prediction Center update on ENSO concluded: "A transition from weak El Niño conditions to ENSO-neutral conditions is expected by March-May 2007."

There may be a good chance of your scenario for high confidence soon.

Ace, can you remind us of the assumptions you use in compiling this graph, i.e., assumed decline rates.


Here are some assumptions for the first chart of C&C production:

142 existing projects/fields in production

Decline rates are assumed to be 6% except when field specific decline rates are known, for example:

Canada (tar)14%/yr increase
Kuwait Greater Burgan 14%/yr decline
Saudi Ghawar 8%/yr decline
North Sea existing 10%/yr decline
Mexico Cantarell 14%/yr decline

119 new/forecast projects/fields in production

If a genuine new field eg Angola, Gulf of Mexico then decline rate is 4%/yr.

If the new project is really a workover of an old field, eg Saudi Arabia Shaybah expansion, Qatar Al Shaheen expansion then a decline rate of 6%/yr is assumed.

Other assumptions

Production from existing and new fields/projects are subtotalled into 35 countries/regions in the world. Of course the production from the fields almost never add up to the EIA actual data supplied for that country. This requires the use of "Other" category representing smaller/unknown fields.

For example, the EIA actual production for the USA for Nov 2006 is 5.15 million barrels/day. "Other" fields production is forced to be 0.67 million barrels/day because the production from the eight fields/projects falls short of the EIA number. The "Other" fields production is assumed to decline at 4%/yr. If this does not occur then assumptions, production figures may be revised.

Annual decline rates are converted into monthly decline rates.

It is assumed that the majority of the fields start production at peak levels as soon as project completion occurs. This is not as accurate as assuming a ramp up to peak for each project. That's why the graph is bumpy.

Where possible I try to get exact starting months for project production. However when a project is schedule to produce in a few year, say in 2010, I often assign January as the start month because there is considerable uncertainty in start dates.

I have not assumed any standard additional delays in project start dates compared to the start dates given by the operator. In reality, projects are often being delayed by years, eg Kashagan.

It is assumed that all projects with peak oil production of over 40,000 barrels/day are included.

The database behind the chart is updated for monthly EIA numbers. It is also continuously updated for project changes - start dates, production volume changes, project cancellations.

Revisions of Assumptions

Every time the database is updated with EIA numbers, it provides an opportunity to compare the forecast for that month with the actuals which can provide some interesting information on a country's production.

If the variance between actual and forecast is too great then assumptions might be changed.

For example, I don't have much field specific information about Congo (0.25 million barrels/day) and Equatorial Guinea (0.40 million barrels/day). The actuals for the total of "Africa other" were higher than the forecasts so I have made an exception for these two countries and being optimistic have assigned 0% decline rates. The actuals are now tracking the forecast much better.

For China, my forecasts seem just a little low and it might indicate that the country is trying very hard to squeeze every bit of oil out of the ground using EOR methods.

Saudi Arabia's production is perhaps under voluntary constraint so matching forecast to actual is invalid.

Actuals for Russia, Iran, Iraq, Kuwait, North Sea and Mexico are tracking well compared to forecast.

The first article said:

Barley and hops account for about 7-8 per cent of brewing costs.

and from that Jerome arrives at:

All our resources are at stake, and it's simply not going to be easy to reduce demand for one by finding substitutes - we're going to have to learn to do with less of *everything*, soon.

Let's work out the implications of a complete disaster scenario: a whopping 10x increase in barley and hops would lead to a 72% increase in beer production costs. (if I've done the math correctly)

BEFORE WE ALL PANIC... What percentage of the price of a pint is production costs?

Let's say it's 30%. In that case, the price of a pint goes up by 22%. (assuming my math is good)

Dunno about you but I'm feeling a little less edgy.


It's not the price that matters, price means nothing to a real beer drinker. It's whether it's there or not.

And Mate! We Aussies know all about it.

Slim Dusty's famous song 'A Pub With No Beer' says it all:
You'll hear a pretty ratshit rendition of the tune. But just read the words below as you wipe your teary eyes at the very thought of it:

Oh it's-a lonesome away from your kindred and all
By the campfire at night we'll hear the wild dingoes call
But there's-a nothing so lonesome, morbid or drear
Than to stand in the bar of a pub with no beer

Now the publican's anxious for the quota to come
And there's a far away look on the face of the bum
The maid's gone all cranky and the cook's acting queer
Oh what a terrible place is a pub with no beer

Then the stockman rides up with his dry dusty throat
He breasts up to the bar and pulls a wad from his coat
But the smile on his face quickly turns to a sneer
As the barman says sadly the pub's got no beer

Then the swaggie comes in smothered in dust and flies
He throws down his roll and rubs the sweat from his eyes
But when he is told, he says what's this I hear
I've trudged fifty flamin' miles to a pub with no beer

Now there's a dog on the v'randa, for his master he waits
But the boss is inside drinking wine with his mates
He hurries for cover and he cringes in fear
It's no place for a dog 'round a pub with no beer

And old Billy the blacksmith, the first time in his life
Why he's gone home cold sober to his darling wife
He walks in the kitchen, she says you're early Bill dear
But then he breaks down and tells her the pub's got no beer

So don't make light of this problem - us Australians know this is a real problem. I think the Austrians will know it, too.

Sooooooooo true!

Get it up ya, mate! Whose shout is it?

I've had the pleasure of drinking with fair dinkum Aussies on many occasions (expats).

One of them is one of the founders of this site:


If you see him, say "Hello from Canada, Davo!" :-)

Struth, Mate, is he a cobber of yours? Blood oath, I'll stick one in him for yer. That is, if I see him hanging around my watering hole.
If I'm not wrong, I think this is where he hangs out:
See ya.

Blood oath, I'll stick one in him for yer.

Please do! The bloke I'm thinking of is indeed from Brisbane.

I think you guys have way too much fun downthere.

I could make a light comment, such as, 'I'll drink to that!', but I won't.

In all honesty, I can't think of anywhere I'd rather be if a very nasty turndown occurs:
Eternal sunshine,
Space, space, space,
Best beaches on the planet,
Plenty of pubs,
Unlimited rabbits and roos to hunt,
No common borders,
Yet more pubs,
and the women are all right too.

Canadians welcome, docile US-ians too.

My wife has a pen pal in NZ, yes I know, I know,not the same place but the pictures of thier beaches were fantastic. Maybe a bit friendlier people in both places unless you are in the cup races...
Made a Croc dundee comment to her friend and boy howdy did I get an earfull...

Regarding the 'greening' of the TXU deal, Texas NEEDS the electricity from those plants -without it there will be mandatory blackouts by 2009 as demand outstrips supply. I predict someone else will build those coal plants.

When the average joe (and their elected official) understands their utility turned down needed power to appease greenhouse gas limits, there will be some unpleasant rodeo activity.

Im against scale up of coal - but there may be little choice. Im trying to find time to write a post on the TXU deal in the context of TExas power demand.

OK, so what are the odds on "clean" coal?

I interpreted the TXU business as intelligent anticipation of future regulation : getting out of the dirty-coal business because it's likely to be bothersome and unprofitable in the future.

If the coal is "needed", can it be brought onstream with currently available CO2 scrubbing technologies for a reasonable cost?


The (2/28) WSJ has an interesting take on the TXU deal. They think that the deal is basically a bet that natural gas prices are going up sharply.

Apparently the vast majority of TXU's electricity is generated by lignite coal and nuclear. They get to charge the market rate for electricity. So, if natural gas prices go up, the cost of generating electricity from natural gas will go up sharply (said costs being primarily borne by TXU's competitors), generating widening profit spreads for TXU.

This has been a trend in the Industry. If you read the following, note the cost to build and the amount of the sale. Very Nice

DPL Announces Agreement to Sell Darby Peaking Generation Site

Sale to Generate $102 Million in Cash

DAYTON, Ohio--(BUSINESS WIRE)--Nov. 29, 2006--DPL Inc. (NYSE:DPL) today announced that its subsidiary, DPL Energy, LLC, has reached an agreement to sell its Darby Station peaking generation facility located near Mt. Sterling, Ohio for $102 million in cash to Columbus Southern Power, a utility subsidiary of American Electric Power (AEP).

Darby Station consists of six natural gas peaking units with an approximate summer capacity of 450 megawatts. Darby Station is located 20 miles southwest of Columbus, Ohio. The units became operational at various times during 2001 and 2002 and were completed at an approximate cost of $190 million. The net book value of the units is approximately $155 million.

Now should I invest in utilities that only have coal plants? Should I short sell utilities that have all NG?

Ok, seriously, does anyone doubt that we will burn through absolutely everything in sight (beer, food, coal, land, rainforest, whatever) before we address the underlying issues of carrying capacity and overshoot? Still trying to negotiate with the nonnegotiable, I suppose.

Yeah, actually, I doubt it. I hate to bait a doomer discussion though. I don't see us ever getting oil shales to work, for instance. People have expanded into the niche created by CHEAP energy. Unless we find some other form of cheap energy (which we may well do), I think expensive energy will, in various more or less roundabout ways, end up reducing population. I feel really sorry for the large populations in the developing world that won't make it, for the poor in the more developed world that will be truly miserable, and all the people who will die from war, famine, and disease otherwise.

If the Romans had managed to eradicate trees in Europe as they went down, I would have to agree with you. They certainly damaged the Mediterranean basin, and other civilizations messed up the fertile crescent pretty badly, but nature will put things back eventually.


Sadly, I too believe we will burn thru anything and everything we can. Whatever's cheapest, whatever's easiest. History backs this up.

Sure, there are 'infinite possibilities' out there, but as a 6 1/2 billion-strong mass who or what will assure we ALL do the 'right' thing.

Enlightened groups, like the TOD crowd, have the luxury of sacrificing money or time or grades of comfort to make 'other' choices. If you're hungry or cold or under threat you tend not too make things more difficult than necessary.

Billions live in a challenged state. That number is likely to go up, not down, as PO sets in. The answers are all out there, but when was the last time we applied them to the problem? (Starvation, poverty, disease, basic health care, and on and on.)

Not to end on a bleak note, I think individually we can lead happy productive lives. I just think collectively, going forward, we're doomed.

Yeah, I'm kind of a "lifeboat" guy as opposed to the "kumbaya" crowd, although I do admire those who try to "make a difference." Going a little further, I think those who are quick to use the doomer label are unfamiliar with Catton's Overshoot, which everyone should read, along with Tainter. Without the context, I'm sure it does appear doomerish to postulate overshoot and collapse.

Jerome, Kudo's for a light hearted way to deal with a very serious topic.
Ancedotal story - One of our employee's has horses. Grass hay this winter is @200.00 a ton vrs the normal winter price 2 years ago of @110 a ton.

Interesting and on the same wavelenght as your comment about us switching to alternatives are his comments about beef. With grain prices being so high (and now hay) cattle opertion cannot switch to a cheaper (hay) product to feed thier animals. He said beef prices tend to drop as feed prices rise because operators send thier animals to slaughter. Feed becomes to expensive to make enough money.

Great topic (rescource scarcity) one that I think will come to the forefront. Nat'l Geo. did a story that included how much oil it takes to raise a beef, if I recall correctly it was 11 barrels.


Honey is much more scare than apples!

Right. Especially no that there's bee die-off.

Ultimately, I like fermenting cider with a good blob of honey thrown in for good measure.

I say we need to conserve energy while staying drunk.

I'll drink to that! I'm planting thirty grapevines on one of my hillsides in a couple of months. With the addition of apple trees, fruit bushes, and hops on the fences I should be in pretty good shape.

First tortillas, now this. Note also that the Freakonomics blog said we'll get skinnier because high fructose corn syrup will get more expensive.

Saw an interesting one the other day. 7% of our calories come from pop. It's is the largest single source of calories in our diet.

I have to say I disagree with your assessment that the "Enviro" stamp on the TXU deal was a good thing.

1)The whole idiocy of this recent surge of takeovers is against any ability to begin living with less, in fact just the opposite, it only stokes the furnace for faster growth.

2)They're now going to roll over any regulatory control, which is weak at best, but the "enviros" have now put their stamp on continuing to say the public has no voice. The "enviros" themselves now have no ability to enforce any agreement, they have the word of capital - hah.

3)Some articles said they agreed if they only would build 4 coals plants instead of 11 - great. Texas is a good place for solar, if you own a utility based on centralized generation -- they all are -- people putting solar on their roofs ain't going to help your revenue stream.

4)Certain environmental groups cozing up to major corporations has produced little in return but money for the groups. Maybe that will change, I doubt it, the one thing history shows is that any power, be it political or business will ride their power into the ground rather than reform, the inertia is to great. Our democracy is broke and our so-called market system is run by a few hundred corporations, doesnt bode well for healthy reform.