The Tata Nano Strikes Back--Does Jevons' Paradox Apply to Productivity, Too?

Can improvements in energy efficiency “save” modern civilization as we face declines in world oil production? While the efficiency revolution may let us drive on half the gas, the productivity revolution may make it affordable to twice as many--or more...

One argument against the efficacy of improving energy efficiency is called Jevons’ Paradox. This suggests that, when we improve our energy efficiency, we also reduce our demand for energy from that same use. That decreased demand in relation to supply makes energy cheaper, which in turn makes us use more of it. It has been suggested that this “rebound effect” only accounts for 5-20% of efficiency gains, but I have written previously about the potential for a “shadow” rebound effect that potentially accounts for nearly the entire efficiency gain.

The Tata Nano: While the efficiency revolution may let us drive on half the gas, the productivity revolution may make it affordable to twice as many--or more.

Often, I find it difficult to apply the very theoretical Jevons’ Paradox to pragmatic thinking about our energy future. The recent launch of the Tata Nano, however, stands as an example of Jevons’ Paradox in action. Possibly of much greater importance, however, are two related issues: the feedback effect between increased economic productivity and increasing energy consumption, and the aspirations of an emerging global middle class.

On January 10th, Tata Motors introduced its new, $2500 “Nano.” The launch was well covered on this site and many others: roughly 50 miles per gallon, four doors, and one windshield wiper. And the potential for the Nano to bring millions of new drivers to a world already trying to conserve energy and reduce carbon emissions was covered as well. And if you dig deep enough, there was even one blogger who raised the nexus between Jevons’ Paradox and the Nano. What I hope to do is to raise that issue here, and to expand the analysis to cover what I consider to be the even more pressing nexus between the Nano, productivity improvement, and world oil consumption.

But I’ve heard that today’s economy is far more productive per barrel of oil consumed than our economy was in the past—won’t a continuation of this trend decrease demand for energy?

The Tata Nano isn’t the world’s most fuel efficient car, and therefore it doesn’t suddenly brings the automobile within reach of potentially billions of new drivers purely because of fuel efficiency. Rather, the Nano is revolutionary because it is representative of another trend in the modern economy—our ability to produce more for the same amount of energy consumed, and it’s broader corollary, our ability to produce most everything more efficiently and cheaply. If you track economic statistics with much interest, you have probably noticed that the statistics covering “productivity” show a virtually permanent increase over the past few decades. The Nano is a prime example of exactly that trend—in real dollars (and accounting for subsidies), it is probably the least expensive four-door car every built by a considerable margin. Some of that comes from economy of scale, some from the ability to leverage processes and materials developed elsewhere, and some is simply the result of designing with precisely that goal in mind. But the result is the same: a car for less money means a car that more people can afford to buy. To the extent that we are dealing with energy-consuming products, greater efficiency of production seems to affect energy consumption via a process similar to that described by Jevons for energy efficiency. The more people who can afford to consume oil in their own car, the more that will.

The larger issue is that increasing productivity—of exactly the type that led to the Nano—is a critical requirement for the growth that drives our economy. Economic growth is driven by three main factors: increasing population, increasing energy availability, and increasing productivity. It is often assumed, here and elsewhere, that a focus on productivity is the only realistic way to maintain economic growth if we are to control population and pollution while dealing with plateauing or declining energy supplies. Does the Nano throw a wrench in that analysis? Even if this unanticipated consequence of increasing productivity only serves to negate our gains in energy efficiency, this is enough to cast serious doubt in my mind over our ability to maintain economic growth going forward.

The Tata Nano is also emblematic of another trend—the rapid emergence of a massive, global middle-class. This middle class may not have the same standard of living or net worth of the “middle class” in the West, but it is significant none-the-less. Today, tens or even hundreds of millions of Chinese, Indians, South East Asians, and Latin Americans can comfortably and confidently provide for the basic necessities for themselves and their families with money left over. They’re spending—and (yes, America) saving—this surplus toward aspirational goals, one of which is to own a car. Car culture in China is thriving, and with the launch of the Nano it seems that industrialists are betting on it thriving in India as well. Can the world, its oil supply and environment, accommodate another 100 million cars? What about another two billion cars? J.D. Power & Associates expects yearly light vehicle sales in India to double to 3 million vehicles per year by 2015, and sales in China to triple to 17 million per year. Unlike the U.S., where the vast majority of our roughly 17 million in annual car sales do not represent a new person beginning to drive a car, most of the sales in India and China go to first time drivers.

The danger of an economy that seems adept at squeezing ever more productivity out of each hour of labor and barrel of oil is that this same trend that could help the West soften the impact of Peak Oil seems poised to exacerbate the global energy supply crunch by making energy consuming cars affordable to an ever greater portion of the world’s population. An expanding consumer base makes it much more difficult to achieve aggregate gains via efficiency-if the number of cars doubles, the efficiency must also; if the number of cars triples, is it realistic to triple miles per gallon across our global fleet? Quadruple? This development seems to carry with it the significant moral hazard (already a hot debate topic within the world of carbon emissions) in the possible “solution” of denying these efficiency gains, or their products, to the world’s poor. Where is the cut-off? Do we cap the “middle class” at one billion? Two billion? Three? The possibility and morality of such a move are highly suspect. We may be stuck between the rock of 2+ billion new middle class consumers over the next few decades and the possibly much harder class and geopolitical situation of those 2+ billion aspirants realizing the will never become “middle class” because of the decisions and prior consumption of the 1 billion in the “West.”

What next, will these people want air conditioning, too?

Most assuredly Jevons' Paradox can apply to PO, though it is more complicated than pre-PO. A Hirschian crash effort to reduce consumption by governments, industry, and citizens might (if hypothetically started in time) result in lower prices if demand were to be reduced below supply levels. All it would take to spoil the party would be some percentage of the population (or 1 or 2 rogue nations) to buck the trend (cavorting in oil-soaked consumption over-indulgence like most developed nations are now) to weaken the resolve of those choosing the higher path.

However, continued growth will likely be challenged in the near term by the subprime fiasco, perhaps moderating oil demand to mask the effects of PO on oil prices. Then PO critics will say, "See, peak oil nuts were all wrong; oil didn't hit $200 by 2010, it's only at $165! There's no problem with supply, it's 'above ground' difficulties..." So the Jevons aspect may be conflated with predominantly unrelated economic turmoil.

Our future lies with better land use planning, more use of mass transit, working from home, biking, etc. I'm convinced, however, that most citizens will not climb out of their cars until they are forced to, per Nate's two articles on human addiction tendencies.

For those who are ensconced in outer suburbia away from mass transit, there are a number of options to driving Nanos or other standard automobiles (though prices are diverse); of course, many suburbanites would recoil at the thought of transporting themselves or their families in something 'less' than they have now;

Electric-assist Bike, -----------------------------------Family powered quadcycle

Electric-assist velomobile (enclosed recumbent trike), ---------------------------Electric Motorcycle

Myers NmG enclosed electric motorcycle (currently fairly expensive)

VentureOne electric or hybrid enclosed motorcycle (coming soon)

Years ago, I built a shell around a small motorcycle, trying to achieve high MPG. The first time I took it on the road, I almost wrecked it as it tended to "fish tail" as speed increased. The aerodynamics were such that it was unstable, that is, it tended to deviate away from motion in a straight line as speeds increase. My solution was to add a vertical tail, which made the thing hard to handle in cross winds or when passing or being passed by trucks. Dump trucks were especially difficult to deal with.

I think it's important to point out that the VentureOne machine is likely to be a very dangerous machine to operate. This is the result of having the center of mass located toward the rear, while having a rather large area exposed to aerodynamic forces ahead of the center or mass. The result would likely be loss of control at high speeds due to cross winds, just as I experienced with my machine. The graphic sure looks cool, though.

The Myers NmG might be a little better, if the batteries are located ahead of the front wheels. They claim a speed of 75 oh for the Myers, so I assume that they have already tested these to find out whether they are stable or not.

E. Swanson

Take a look at these prototype VentureOne videos where the bike is being tested by Top Gear and the like; I believe your concerns will be addressed.

I use to ride motorcycles too and I agree, the 'Venture' would be dangerous. If someone owned a place out on the California coast near Bodega Bay, the road north from there would be perfect for that little roadster. But for any other roads, even beyond aerodynamics, my concern would be other vehicles not seeing me. When I use to ride a regular 2 wheel motorcycle I found one had to ride very defensively because other people simply do not see bikes as well as other cars. Now with all these huge SUV's the problem is compounded even more. A nice idea, but too impractical due to safey issues.

See the videos mentioned in the previous post, especially where the prototypes are driven through busy traffic. If we gauge every mitigation by how it will compare against large SUVs, we end up in a situation where we always revert back to a larger vehicle than would have been helpful. Your argument could be used to discourage even bike commuting, for example, so the fallacy of SUVs always being safer falls flat when we hit the downslope of PO.

I was told my tiny Honda Insight would be crushed by large SUVs the first year (and I live in an area with LOTS of them), but I'm in my 8th year with it with nary a scratch (granted, I've vanpooled alot when not zipping around on consulting engagements). As gas prices go higher, or as the recession deepens, we'll be seeing lighter traffic anyway.

Go watch "The World's Fastest Indian".

Putting a shell on your motorcycle is not a good idea unless you really know what you are doing.

However, those 2 vehicles looked like tricycles to me.

And then there are those efforts to create two wheel enclosed motorcycles with retractable landing gear, from the Monotrace Cabriolet of 1925

to the "ecomobile"...

... with a number of variants in between.

I always liked the idea of a retractable wheel motorcycle, although frankly I'd be terrified to drive one.

The Eco-Mobile is interesting, but at 1200cc and $80,000, it's a bit of an overkill.

oh, I agree... it's absurd. (But cool!)

And that Montrace Cabriolet was an excellent find.

I have not been to India for seven years but I don't things have changed all that much. I had the sense that the most obnoxious pollution was coming from two stroke vehicles, two and three wheeled motorcycles, particularly in extremely congested cities like Mumbia and Pune. When I was told I should leave my hotel in Mumbia a good six to eight hours before my flight from the Mumbia airport I thought it was a joke, but it wasn't. I was glad I did. I could have walked the ten to fifteen miles faster. The traffic is completely insane. Anyway, to replace two-stroke vehicles with four-stoke vehicles would be a big improvement in terms of air quality and its difficult to calculate effect on gas milage. Replacing a 80 mpg two stroke motorcycle with a 50 mpg four stroke car is not necessarily a 37.5% reduction in energy efficiency and a 60% increase in fuel consumption. Once vehicles are stuck in traffic, efficiency goes way down, especially for overlaiden motorcycles. Also pollution goes way up, especially for slow moving motorcycles. Furthermore if a car carrying four people replaces two motorcyles carrying two people each then the car may have better gas milage and reduce pollution over the two motorcyles. If you are out in the country driving on the highway as an individual okay the milage is better but the pollution factor still is not. And driving solo without carrying a bunch of stuff is not the Indian way.

Check out this report, in particular the table on page 33.

This issue is very complex and I just not convenced that the Nano is all bad if it is replacing a swarm of old, poorly maintained, cheap oil filled, two stroke smoke pots.

I think Nano, the small car from Tata, should be successful. Bajaj Auto, one of the largest two-wheeler company, is coming up with their own version of ultra cheap car. There is huge market for first time car buyers, particularly in small cities. A car at this price should be successful.

William Stanley JEVONS.

Spelling has been fixed, thanks. I seem to be cursed with this name... last time I wrote about it, I initially put the apostrophe in the wrong place ("jevon's"), and this time I thought I was being so clever getting that fixed. Oh well... and Jewish Farmer below is right--I'm confusing the spelling with John Jeavons of "Grow Biointensive" fame. Consider this a public service announcement:)

Just FYI, Jeff, I think you are confusing the spelling of W.S. Jevon's name with John Jeavons of Biointensive Gardening Fame.

It strikes me that we need an alternative to middle class aspirations. What that would be is another issue altogether, but despite the tendency of many commentators to dismiss this possibility as impossible, the only hope seems to me to change the culture of aspiration - to show, for example, a billion rich world people aspiring to lower their standard of living.

Let's get right on figuring out how that would happen ;-).


"Standard of living" can be a relative term that focuses primarily on goods and income; shifting the discussion to include leisure, safety, cultural resources, social life, mental health, environmental quality issues and other 'quality of life' measures can help to realign the discussion and enable the refocusing of the goals people set for themselves and their communities.

It absolutely can - but it isn't an easy reset. That is, most of the socio-cultural benefits you achieve work best if everyone in a given society is doing the same thing. So we have to lower economic standards of living with the promise of other returns later on (there are exceptions, but in general, for example, these changes work best on a societal level).

Again, I think we can do it - but while I think an articulation of quality of life benefits is important and useful, we should pretend that there's no cost involved to the people we're talking about. The simple truth, however, is that we don't have a choice.


Go deflation!

Someone had put it as shifting from a consumption-based lifestyle to an experience-based lifestyle. Collecting good memories rather than things.

I think this is the crux of the problem. The solution seems to start with recognizing that we tend to substitute the material for want of the experiential in life. The only purpose of material goods it to achieve an experience, but often (though, admittedly, not always) that experience can be achieved with out the material, or at least doesn't require the kind of material consumption suggested by advertising. I've written about this in "Magazine Simplicity."

I don't think it's unrealistic to shift our focus from being rich because we consumer more to being rich because of the quality of our experience--it just requires a different design focus. I do, however, think it's unrealistic to think that "society" or "government" will make this change for us--we must do it for ourselves individually. The more that individuals set examples of how this is A) preferable and B) implementable, the more chance it has to spread from the ground up. I think what is needed is less a culture of "rich people trying to lower their standard of living" than rich people redefining what they consider "standard of living"--more focus on doing more with less, on the experiential, on a notion of elegance that prefers to see how much can be done with little (even social competition on that point).

Agreed. And there are organizations moving in this direction, such as New American Dream, among others (can other people provide more organization links?)

Sometimes it means taking a little longer getting somewhere, or being a little colder first thing in the morning during the winter, or warmer in the summer. If we compare how our grandparents grew up versus our lifestyle, we could recognize that there is much we can do without and still retain an equivalent (or even greater) quality of life. Both sets of my grandparents were farmers during the Great Depression, so my parents lived through some of the hardest of times, yet have endless fond memories of growing up without regard for their penniless state.

So when I'm huffing my way up the side of a ridge on a late summer's day, the heat is not the most pleasant sensation, but the physical exertion and the fresh air are remarkably mind-clearing and stress-reducing, so the benefits clearly outweigh the 'costs'. And when the dinner table is set with produce right from the garden, the understanding of where things come from brings understanding not only to our children, but to visiting friends as well.

So setting examples (as well as educating others on the impacts of resource limitations and climate disruptions) certainly is the most effective means of 'walking the talk', and doing so in a positive manner carries the greatest chance of being effective (as opposed to railing on people for driving SUVs, etc). One of my favorite examples is seeing a cyclist during rush hour with a "One Less Car" jacket on, which reminds the observer of several benefits of bike commuting in a non-indicting manner.

This subject would make for a intriguing TOD article, especially as a follow-on to Nate's addiction articles...

I do, however, think it's unrealistic to think that "society" or "government" will make this change for us--we must do it for ourselves individually.

This rejection of goverment makes no sense. Government and human society are inseparable. Even hunter-gatherer bands and neolithic villages had government. Not in the sense of elected officials, written codes of law, etc., but in the sense of a set of conventions that governed social and economic relations between the constituent members of society. The higher the degree of specialization of labor the more complicated such conventions have to be.

If you have a preference for greater material simplicity and less centralization that is all well and good. It may well be that the current national goverments will be largely ineffective instruments for bringing about a new social order. But if you believe that some new vision of what constitutes the 'good life' can be effectively implemented without rolling up our sleeves and doing the hard political work of creating the appropiate set of conventions and institutions which will support that vision, then you should find a new substance to put into your pipe.

Your comment seems rather incoherent--I hardly know where to start:

1. Are you suggesting that my statement that "it's unrealistic to think that 'society' or 'government' will make this change for us" is a statement that "government makes no sense"? I don't think that's what I said--I think my words were pretty clear--I said that government won't do it for us. Not that we can't do it through government--the need for individual responsibility seems pretty clearly expressed in my words to me.

2. Our words seem to actually agree, not disagree. You suggest that I think we can achieve the good life "without rolling up our sleeves," when my actual words said the exact opposite--that *WE*, as individuals, must do the sleeve rolling, and not merely expect it from others (the government).

3. If what you're actually suggesting (because this is the only way I can understand your apparent disagreement with me) is that "appropriate" conventions and institutions must be hierarchal, then your anthropology is way off, and I think you're falling into the classic definition of insanity: that somehow, this time, doing the same thing won't have the same results. If this isn't what you're suggesting, then I have no Idea what you're talking about...

Let us suppose that you and I and a small group of people living relatively close together have all decided to live materially simpler lifestyles and to provide for our needs from local resources. If there is any degree of specialization of labor whatsoever then we will collectively need to make decisions about how to share the outputs of our labor. This decision making process is, by my definition, a form of government. Where in this illustration to you see a suggestion that I favor the creation of hierarchies of wealth and power? If you suggest that we should merely barter with each other and therefore avoid any more formal agreement, then a heirarchy of wealth will be created by whoever gets hold of the most valuable resources. In this case our tacit agreement is to allow 'ownership' of natural resources to determine status, and we have created bad form of government.

The point I was trying to make was that the nature of the social agreements that we reach (which we cannot do for ourselves individually) must be a central part of any discussion about how create a new, sustainable economic order.

I agree with this as a *portion* of the necessary project. But the reality is that we really do have strong reasons to do this faster than public opinion is likely to come around. That is, it isn't just the case that we can't eventually afford 8 billion rich people, but that material limits are banging up against us now, and we can't afford 1 billion rich people.

So while I agree that elegance of solution and redesign is part of the project, and essential to the creation of any larger structures to enable this, I'm not sure that I think that simply living our beautiful, deeply experiential, lower energy lives (as attractive as I find that idea) is sufficient, while there is the enormous opposition of advertising and an entrenched and institutionalized requirement for growth. That is, we're already seeing the way "simplicity" is marketed and thus the models perverted. I think modelling would be part of it - but it would also require a great deal of economic and social remodelling that would have to be done simultaneously, since 'twere best done quickly, from top down and bottom up, in both cases in a highly organized way.


Good point--I recently flipped through a copy of "Real Simple" magazine. The whole thing was just a list of things that you could buy to live simply (the "articles," not just the ads). The whole notion of for-profit corporate enterprise, where the sole fiduciary duty is to maximize shareholder return, seems fundamentally unsustainable, to be frank. I'm open to being proven dead wrong on that point, and I recognize it's a very "extreme" position (from the context of what Americans are supposed to believe), but I haven't seen a convincing argument otherwise...

jewishfarmer -- please read my post way down below which starts with a comment about "Kill Off" and ends with the quote RE" the young man in an ad for the new Tata (IIRC) "Now There's A Man!"

I think that India and China as well as the USA are using economics to keep people busy in a mode of "intentional ignorance" while they actually serve the military machines being used to carve out more Lebensraum for the elites.

The policy of genocide or "Kill Off" is clearly preferred -- look at all of the arms bought and sold, and the stashes of WMDs folks have or want to have on "our side" -- whichever side that happens to be.

The policy of Resource War is sold like soap flakes --whatever myths, naratives, or fantasies needed are used. To sell soap flakes we use the fears of appearing to be unclean and therefore ashamed. We promise sex appeal and happiness if one uses the right soaps....drives the right car....and so forth. To sell war we appeal to other ancient prejudices and fears -- religious, cultural, mythical. We also appeal to stories of our mythical righteousness -- spreading democracy, freedom, and a magically replicable "way of life" to someday be shared with the good, compliant folks and denied to the evil-doers who claim to see things differently.

So the cars and soap flakes and most of the discussion about them end up being mostly a distraction, do they not?

The only discussions that make sense begin with: "There are too many of us competing for too few resources" and end with a new discussion of "So how can we design our lives to make a peaceful solution?"

No one -- not even Mr. Obama here in the USA -- comes close to talking about the reality: We either do "Kill Off" or "Peaceful Powerdown." Various "products" and "solutions are mostly marketplace noise -- the sound of a massive, slow collapse -- in any other context.

As I see it, there are two ways out of Jevons' Paradox.

One is that which you have identified: change our definition of "success" to one that is not proportional to resource consumption. No matter how efficient you are, if "better" requires more resources, then human competitiveness means that, in the end, you lose.

The other escape clause is the reason that there is an important difference between incremental (say, 5%-25%) efficiency and radical (50%-90%) efficiency. It is simply that radically reducing the resources required to perform a task opens up new options for supplying those few resources that are required. For example, a house that is 20% more energy efficient saves 20% on their energy bills (or is built 20% bigger, at the same energy price point). A house that is 95% energy efficient can have its energy needs trivially satisfied with a small PV system. It's also probably cheaper to build, and definitely much cheaper to maintain, because (at that level of efficiency) you have engineered out alot of the expensive, failure-prone mechanical equipment.

This effect is particularly pronounced in the context of energy, but it's also available in other realms: a radically efficient structural design may allow you to switch from steel to carbon fiber while saving money and embodied energy even though carbon fiber is expensive stuff. (However, IMO, the key to controlling the demand for non-energy resources is to design for 99% recycling through an industrial metabolism.)

There's a third way out: Radical birth control. Fewer people means fewer energy users.

"Radical birth control" starts to sound like a James-Bond-Villain scheme (Moonraker, anyone?). I've always been a bit empathetic towards the supervillain archetype, because at least they realize that drastic steps are required to fix drastic problems, but...

a billion rich world people aspiring to lower their standard of living.

Let's get right on figuring out how that would happen

I know how to do that, higher oil prices for the USA and Europe because others are aspiring to raise their standards of living.

Related, but more in the global warming frame, Gwynne Dyer uses the Tata Nano as an example of the requirement for 'Contract and Converge' strategies: Lowering global middle class consumption to converge with the improvement in developing world consumption. Here are some excerpts and a link:

"...Clucking disapprovingly about mass car ownership in India or China misses the point entirely. At the moment, there are only 11 private cars for every 1000 Indians. There are 477 cars for every 1000 Americans.

If the total number of people who can afford cars exceeds the number of cars that the planet can tolerate, then we will just have to work out a rationing system that everybody finds fair or live with the consequences of exceeding the limits.

"Contraction and convergence" is the phrase...

The notion is simply that we must agree on a figure for total global emissions that cannot be exceeded, rather as we set fishing quotas in order to preserve fish stocks. Then we divide that amount by 6 1/2 billion (the total population of the planet), and that gives us the per capita emission limit for everyone.

Of course, some people (in the developed countries, mostly) are emitting 10 or 20 times as much as other people (mainly in the developing countries), but eventually that will have to stop. The big emitters will gradually have to "contract" their per capita emissions, while the poor countries may continue to grow theirs, until at an agreed date the two groups "converge" at the same level of per capita emissions.

And that level, by prior agreement, will be low enough that global emissions remain below the danger point...

By mid-century, there will have to be the same number of cars per 1000 people for Indians and Americans - and that number will have to be a lot lower than 477..."

Of course. peak oil may take the 'gradually' out of the above equation!

It is has been estimated that the world can afford some 250 million people living 'the dream' of 'he with the most things when he dies wins'.

"We leverage our improved efficiency to produce more stuff" seems axiomatic. The solution therefore isn't free energy. As 'free energy' would deliver the death nail. Though clean energy production would seem to be the right choice.

I believe that the solution has been offered and mostly rejected, by many, remains the same and is spiritual in nature.

The adage by the 'Beatles' of "All you need is love" is close
I would admend it to "All you need is the LORD's Love" and a clean environment.

An interesting discovery of late for those who want more efficiency is suggested by a discovery made by Thane Heins of Ontario.
2 recent articles in the Toronto Star discuss his finds. Although there is reluctance amongst many to embrace his finds. He is gaining some momentum.
(some have reported having problems viewing the demo)
I have seen the demo and it is impressive showing a rotor under load that should be decreasing in speed. Instead it speeds up.

If the gains in efficiency are profound how would this alter the paradox?

Let’s think about Jeavon’s “paradox” for a moment.

  • The primary goal of our economic activity is to increase the total volume of economic transactions as rapidly as possible.
  • Efficiency improvements allow us to manufacture more stuff for the same expenditure of production resources (energy, labor, etc.)

And the result is?

  • We leverage our improved efficiency to produce more stuff.

Wow! What a subtle, complex and “paradoxical” idea. How did anybody ever figure this out?

If we ever have any hope of dealing with resource depletion we have to develop rational economic goals and economic institutions capable of pursuing them without creating social havoc in the form of recession, unemployment, etc.

Jevons Paradox is Economics 101.

It is particularly visible in the airline industry. Productivity gains, particularly with fuel efficiency, have permitted an ongoing reduction in the real cost of flying ever since it became a form of mass transit. Those gains have been more than offset though by growth in the industry. The net result is an overall increase in the quantity of fuel consumed by the airlines.

That' Jevons Paradox - when increasing efficiency paradoxically leads to greater consumption. The feedback loop caused by the multiplier impact of economic growth amplifies the paradox, in the case of the airline industry, by a significant factor.

I think your economic reasoning misses some important facts.
First off, it takes time for any new technology to be deployed in the market, especially so when considering the entire world. Secondly, population growth means that the size of system of economic activity has increased. Thirdly, in the case of the airline industry, improvements in passenger seat miles per gallon of fuel may translate into more passenger miles without increasing if demand for passenger miles does not change.

Finally (and most important) your analysis assumes unlimited availability of the fossil fuels used by the airline industry. The price of oil has been low for decades, with a few exceptions, until the past few years. Our basic problem hiding behind the discussion is that oil production is at, or nearly at, peak. Thus, in the short term, once demand exceeds supply, it's a zero sum sort of situation. If one part of the world economy uses more oil, that implies that another part will have less. The airline industry is competing with other users for kerosene type fuels, so there are lots of consumers of kerosene that will be in shortage if a few more people get on the airplanes and fly anywhere. These days, there are lots of folks in Iran and China that are shivering in cold houses who would give whatever they could for a few gallons of kerosene just to keep from freezing. Kerosene is also used as a cooking fuel and can be burned in diesel engines as well. One must not consider just the airline sector in an analysis, as you apparently have done here.

Once the limits of supply are hit, improvements in airline seat miles per gallon may translate into reduced prices in the marketplace, but that will only be temporary and only obtain if the increased efficiency is deployed faster than the decline in availability, as population growth tends to ratchet up the amount of kerosene demanded by the more mundane folks who don't have electric heat pumps or natural gas supplies. I don't think we are going to see a nice, smooth, painless transition to alternative energy sources.

E. Swanson

Jevon's paradox applies to a pre-peak energy world. Hirsch Report-style pre-peak mitigation cannot work if Jevon's paradox holds. It would make all mitigation efforts prohibitively expensive.

In an ideal post-peak world,global energy conservation would match energy decline rates. Downward price pressure from energy conservation would be matched up with upward price pressure from diminishing supplies.

The reality of a post-peak world, however, will be characterized by the time-lag between investing in some conservation efforts and seeing an energy-savings payoff. The downward slope will experience cycles of mini-boom and mini-bust as individuals, companies and governments first overspend then underspend, then overspend on energy conservation. Jevon's paradox holds in the downslope short-term, but not the long-term.

I think the key, from a mitigation standpoint post-peak, is that Jevons' paradox complicates and to some degree negates efforts to "get ahead of the curve." In the long-run, our energy consumption will be remarkably similar to our energy production :) However, if we want to pursue goals like increasing the standard of living for the global poor, it will make it very hard to balance that with a program of mitigation...

I'm a little concerned that you're overstating a few things here. The Nano seems to me to be more about cheap labor and designing for low cost in an unregulated environment than to be about productivity. While a Nano and a BMW M5 are both four-door sedans, I don't think most people would consider that a valid comparison for productivity purposes. Is isn't as though Tata has been producing this car for a decade and the prices have been falling due to productivity enhancements. If Toyota manages to produce a Japan-built Yaris to compete with the Nano at a similar price point, I would think we could call that due to productivity growth.

Also, while I would agree that population growth, productivity, and energy availability are key components of economic growth, I think it's debatable that those are the main ones. I'm sure the TOD community has considered whether increasing energy availability is more important than innovation and investment before. Perhaps we could dredge some of those discussions up. AFAIK, while energy availability clearly is important, it isn't yet settled that we can't have economic growth with mildly declining energy availability. A lot of people assume that any decline in fossil energy means the end of economic growth, but it's not a given. OTOH, I'm quite convinced that ELM-style availability declines won't allow for growth. I expect the rich world to make sure that doesn't happen.

I think the value of the Nano in this example is that it is emblematic of our economy's drive to increase productivity. I think it does represent an increase in productivity--a significant one--because it is priced at essentially the same price point as the most popular motor-scooter in India (this is the market for which it intends to compete). Prior to the Nano, it wasn't possible to get this much car for your money in "real dollars," so its launch is a productivity increase (if we assume the same potential for profitability as what it supersedes). Sure, a Yaris for Nano prices would also represent an increase in productivity, but that has nothing to do with the increase in productivity represented by the Nano in and of itself...

Do you have a reference for the price of the most popular motor-scooter in India? I found the prices for Honda scooters in India at The Eterno, for example is only Rs. 39,222. The Nano is Rs. 100,000. That hardly seems like the same price point. [Note, edited to 100,000 - the article I saw had a misplaced comma that made the price look higher.]

[edited out the dispute over the figures mentioned above]. I remember reading articles when the Nano first came out saying that Tata was aiming to compete with the most popular scooter brand that sold for between $1500 and $1800--I'll try to find the reference.

Here's one article suggesting the competition is scooters priced from 50,000 to 70,000 Rs.:

I'm sure there are scooters for cheaper, but I think Tata's logic is that, on many levels, a scooter isn't a car--reducing the price difference from 4x+ a scooter to 2x a scooter price makes that gap pretty small...

I would be interested in your response to the argument that productivity growth in recent times is most significantly attributable to a shift to higher quality energy.

Sorry, I can't locate a link to a key article making this case. The argument was advanced, as I recall, by some or all of the Cleveland, Costanza, Hall, Kaufmann... gang of peak oil pranksters.

I think that has to be a huge part of it. I don't think we can discount design, process improvement, centralization, specialization, etc., but when you consider the value that instant-on natural gas or electricity brings to businesses, this must improve productivity. However, I'm not sure that we've improved the quality of energy over the past decade, while the Nano stands as an example that productivity has continued to improve. Again, hard and clear stats on this are a real challenge.

"Energy & Resource Quality" by Hall, Cleveland, & Kaufmann. They found that energy use could predict US GNP from 1929-1983, but with some variation. They were able to lower the variation by adding in three factors
1. Energy Quality (71.5% of remaining variation)
2. Household fuel consumption (23.6% of remaining variation)
3. Fuel prices increasing or decreasing consumption (1% of remaining variation).

(between countries was a product mix variation that needed to be added).

I would think that we might have seen an "Energy Quality" type improvement with the introduction of automated process controls that would increase the advantage of electrical of other switchable energy supplys.

Is the nano an example of productivity improving? Meaning do you really get the same thing for less energy input? You don't get more miles per unit of fuel input over prior designs. Instead, this strikes me as just the opposite of efficiency - less material is used to make a fragile vehicle very quickly that will soon be gone.

Efficiency often trades against rate. To increase the rate, you lower the efficiency. And that is what I see here. To get yet more people into cars, we lower the building standards of cars. This is the plastic bottle replacing a glass bottle. A paper dollar replacing a metal dollar.

Or a better analogy, trying to replace large long lived oil fields with tiny short lived oil fields. Soon you set yourself up for a huge decline rate.

I don't think car use in India will rise too rapidly.

Oil should rise in price soon, perhaps by 2010, to maybe double today's costs by 2015 with oil at $180/barrel according to this analysis from a respected source, Maxwell:

It is not so much the direct affects on India, but coping with the recession in demand in the West that will dent Indian growth.

With oil at those prices, the electric moped will be favoured, using traditional lead-acid batteries until more advanced designs such as batteries combined with ultracapacitors or Firefly's carbon foam lead acid become available.

The pressure will also be on to reduce costs in lithium battery technology, although it will be a long time before they are affordable by many Indians, and further advances would be needed before they could provide more than plug-in capability at anything less than astronomic cost.

Most of the Indians who do manage to get mobile will probably have some kind of tiny electric buggy, run on lead acid or advanced lead acid.

Powering them should not be a problem, as although I do not share Stuart's extremely optimistic cost projections for solar which would allow them to power the gloomy north, in a few years you should certainly be able to power sunny India, although I must try to find out more information on how they would do in the monsoon season.

Dave, My Indian friend who is currently there tells me that the monsoon is not cloudy/rainy all day weather, but rather heavy showers. I used to live in New Mexico, and we had a smaller/weaker version of the monsoon, it was mainly thunderstorm season, so I'm guessing that maybe 50% of sun gets through the clouds during their season.

I've managed to track down some information.
Apparently in Karela cloudy monsoon weather lasts for about 4 months and substantially degrades performance for some systems:

This was not encouraging, as at least on one system efficiency in cloudy conditions ends up at 1%:

I perked up a bit when I found out that apparently amorphous silicon does better than crystalline:

Finally I have found an actual field trial in Malaysia of amorphous silicon:

This is very reassuring. I can't really work out what they are on about when they claim an efficiency of 60% of rated power, as that of course can't possibly allow for night-times.

I am not sure whether it does account for all daylight hours including when the sun was low in the morning and evening, so I still have more research to do, but to me it looks hopeful that my original thought that solar can provide most of the needed power anywhere near the equator should hold true.

Some of the thin film technologies also appear to have better performance than chrystalline silicon, but I have not looked into it too much as I am a little doubtful of the availability of indium and gallium and so on to power millions of solar panels.

Solar thermal also seems workable, apparently the vacuum evacuated type are best for cloudy days, and you need to ensure good insulation:
Introduction to Solar Power
I am looking for something more numeric.

to sum up for amorphous silicon:
The only downside for space constrained countries alike India is that amorphous silicon uses up more space than crystalline, as it is less efficient per square meter.
The South-east US should be able to use amorphous silicon for most of their power, not just the South-West with it's lower cloud cover. South China should be fine too, although of course it has space constraints- the huge advantage there is that even if some burn is required in periods when there is heavy cloud for some time, it would still directly displace most of the vast coal burn in area, directly reducing greenhouse gasses.

Amorphous silicon is also the best of a bad job in northern countries like Britain and Germany, but the high latitude still kills it at any reasonable cost due to the lack of sunshine in the short winter days.

Breakthroughs rather than incremental progress are required at those latitudes.

Still, it is no small thing for us to potentially have the means to provide the power which most people in the world would be able to use, even if it is not do-able in the North - most of the world's population don't live there.

Concentrating Solar Photovoltaic does not work remotely well with monsoons. If the sun is scattered, the rays can't be focussed. Flat panels only care about the amount of sunlight getting through. It can be coming from all over the sky and it will still work with flat panel.
This is one of the ways that Concentrated Solar Photovoltaic is limited. Sure, it's by far the fastest way to ramp up power, and it's profile matches air conditioning demand to a great extent, and it produces the least amount of net pollutants even compared to nuclear and wind, but it has it's problems.

wkwillis said:
'Flat panels only care about the amount of sunlight getting through. It can be coming from all over the sky and it will still work with flat panel.'

From the sources I've found that is not true, and especially not true for chrystalline silicon.

Performance drops off very rapidly, but a lot less for amorphous silicon, although still severely enough that battery bask-up is needed to cope with variations of the order of minutes.

Even if we didn't have peak oil, a massive motorization in India would get stuck in the enormous infrastructure cost associated with new roads to accommodate the additional car traffic. This effect is already visible in China. I wonder how much you would have to add to the cost of a Nano, in macro economic terms, to provide roadspace needed by that car, even if it is smaller than other cars.

What strikes me about this whole argument against the Nano is the hypocrisy. Putting aside the emission considerations, which I'm unfamiliar with, it gets 50 MPG? Well guess what, that's more any car sold here in the US, as far as I know, and almost surely more than any with large production. So anyone here better take a good, hard, deep look at themselves and what they are doing before criticizing people abroad who want to buy cars. Even if every family in China and India bought one of these, I doubt they'd be consuming anywhere near as much per capita as we in America are.

We're driving literal tanks around that are about 40% as efficient.

This post is not intended to clash with the analysis here, but rather as an aside. As long as the US is still jacking off over cars, whether they are hybrids (witness the hype for Hybrid tanks during Super Bowl XLII) or not, we don't have a lot of business suggesting what other countries should or shouldn't do. After all, they're trying to emulate... us. So, I ask you, TOD readers, where's the real problem? How about we concentrate on living more locally first, to lessen the need for tanks in the first place, and do more walking and cycling. Perhaps then we can set a truly good example instead of the terrible one of our Business As Usual.


The demand for "tanks" as you call them will not be stopped by living close to work, that is for certain. I have friend that live within a two mile radius of store, post office, doctor and work, and still drive giant SUV's everywhere they go.

The "tank" is an aesthetic, cultural, marketing choice and has nothing to do with transportation per se. It is a "style" accessory. I am beginning to believe that people would want them in the drive as ornaments even if they couldn't move them (hmmm, there's a thought....a replica SUV for the driveway with no innards! :-)


I agree, it's a status symbol, and thank god it's becoming more and more impractical. In my 2nd mention of "tanks", though, I was actually referring to our cars in general. (I realize I didn't specify.) I was recently in Paris, Fr. and their cars seem to be on average about half the size of ours - and that's not an exaggeration. Compared to their cars, even the quite, by US Standards, modest Prius looks like a little tank.

At least when I talk about the Nano, I don't feel I'm taking that attitude, I don't think Mericuns are any more entitled to the planets resources than anyone else. At least early on, the Nano is competing against the scooter market, with a whole family sitting on handlebars etc. the safety/comfort improvement of the Nano would be large. I doubt many Nanos will get close to 50mpg, Indian roads are already terribly congested. And I suspect they will in fact be driven much less than the typical OECD car. The Nano would undoubtedly fail OECD safety tests, but it is a huge step up in safety for the people it is targeted at. But as an example of the way we expect nominal (fixed price) oil demand to dramatically increase it is a very good one. We will soon see how supposedly rich, but heavily indebted Mericuns can compete for the available oil. I don't worry about the higher price, or the changes to our lifestyle (which would be for the better), but I do fear for the political backlash.

If, as many are saying, we have reached peak oil, the total amount of oil available for autos and the like will continue to decrease over time. Given this assumption, whether or not there is a JEVONS paradox seems irrelevant. The remaining oil will be largely allocated by the market and those on the low end of the economic stick in India will simply have less effective access to enough oil to propel these cheap cars very far in large numbers. Yes, maybe they will double or triple their car ownership. But what will they do with them? Pull them around with sacred cows?

It's not about the number of cars;it's about the miles traveled with these cars.

Now, if we start producing cheap electric cars that will run on coal, then we do have a problem. That is what I am concerned about.

I think that the number of cars does matter a great deal, as it is a primary contributor to the inelasticity of demand for the second figure--how many miles are driven by cars. Buying a car tends to calcify choices that require driving (e.g. living too far away to walk), and also represents a huge sunk cost (even more so comparatively in India & China) when people are deciding how to allocate future personal assets...

From Ten Year Mission Plan for Development of the Indian Automotive Industry into a Global Hub 2006 - 2016

India has the highest proportion of population below 35 years, 70%, (potential buyers) which means that 130 million people will get added to the working population between 2003 and 2009. The trends indicate that small and medium cars would remain dominant and a shift towards high end cars is expected at a faster rate. The SUV market is expected to develop rapidly in future. Higher disposable incomes coupled with availability of easy finance options have driven the Passenger vehicle segment.

(My added emphasis).

Edited after checking out FSchumacher's post below.

These figures might be 1-2 years old - from a net search:

Approximate # of Cars Per 1000 people:
US - 765
Europe - 300
China - 24
India - 8

As another post points out. If we are at or near peak then the tato won't cause more oil to be produced or burned, it will just alter the distribution. So jevons paradox does apply as efficiency has enabled more users to burn oil.

IMO the goal of anyone who is as aware as this community is would be to find ways to "embed" existing energy production into future energy supplies. Keeping oil reserves in the ground would be the best method however that's likely not going to happen. If existing production could be focused on projects that would ensure future energy supplies, we could do an end run around jevon. Anything solar, tidal, or wave even if the economics aren't favorable over coal, gas or even nuclear could effectively soak up jevon's efficiency gains. And even if the energy payback is less than optimal, embedding energy would make it available in the future where hopefully driving your hummer down to the store to pick up a pack of cigarettes would not be an option for anyone regardless of how much money or power they have.

Buying a car tends to calcify choices that require driving (e.g. living too far away to walk), and also represents a huge sunk cost (even more so comparatively in India & China) when people are deciding how to allocate future personal assets...

1. the huge sunk costs don't matter. you can always sell your car or your house.

2. the price of gas still weighs on how far you drive. nothing is calcified.

#1: Economics 101 tells us that sunk costs are a critical factor in decision making:

#2: You can always sell almost anything as long as you don't mind accepting a low enough price. The resultant loss (especially in a market where you've, say, bought a car and suddenly gas prices go so high that demand for cars drops heavily) is sunk cost--see #1.

#3: I didn't say that the price of gas didn't matter--just that sunk cost ALSO matters.


You concentrate very much on efficiency and the Jevron paradox resulting from that.

But the Nano is intended for the Indian market, mainly first time buyers, as you mention.

That means Jevron does not apply: There is no such thing as 'more efficient' if you buy your first car.

More efficient than what? Your bike? Your feed?


As I mention above, the Nano is not intended here as an example of Jevons' Paradox in action, but rather an example of a parallel phenomenon in productivity: increasing productivity is exactly what is making the Nano affordable to many of these first time buyers. The result of this ability to produce more with less (and with less energy) is not energy savings, but rather more people able to consume.

The increase in efficiency brought about by the invention of the double and triple expansion steam engines of the 19th century killed sailpower and caused a massive increase in the use of coal and, later, oil. But we are, more or less, at peak oil now, and oil supply has become inelastic. As long as the Tata Nano stays primarily a petroleum fueled vehicle, it can't increase oil consumption. It only changes WHERE the oil is burned, not the amount. Ironically, an electric powered Nano could increase total energy consumption, in which case it would become largely a coal powered vehicle, since that is the primary electrical energy source.

One can't look at transportation or settlement patterns without considering the nature of human nature. Humans are a generalist species that prefers extensive to intensive utilization of resources. This means we spread out and hunger for mobility. It is part of our genetic code. Automobiles provide fast, isotropic, schedule-free transportation, the most desirable kind. Peak oil, global warming, food shortages are all functions of human population explosion. Human populations recover rapidly from the effects of war, famine and pestilence, but prosperity suppresses population growth rates, and mobility is an essential component of prosperity. There lies the conundrum: bad in the short term, good in the long.

The Tata Nano is the most significant automotive design in the 50 years since Alec Issigonis' brilliant Austin Mini made transverse engine front-wheel drive the automotive norm. The Nano's impact may be greater in the developed world than the developing world for two reasons: Tata recognized the primacy of morphology (shape) in automotive design and it used parsimony, rather than complexity, as a problem solving tool.

To borrow a term from physics, the automotive industry is caught in a phased-lock-loop. Call it groupthink or gleichschaltung or whatever, but it's clear that the whole industry thinks alike and therefore recapitulates the same set of solutions. Ratan Tata, chair of the Tata Group, said the past two years have been the loneliest time for him. Only Carlos Ghosn gave him any encouragement on the one-lakh car project.

There is a parallel to Pierre-Jules Boulanger's design brief for the Citroen 2CV: accomplish the greatest utility with the least materials. Put four small wheels at the corners to maximize interior volume with minimum exterior skin; put the engine in back to simplify the drive train and design of frontal crash absorption; reduce engine mass and component count.

What is significant about the Nano is not the $2,500 price, itself, but that this is half that of the lowest cost car produced in India. In North America, we have an extremely inefficient installed vehicle base. Our vehicle fleet is expensive and uses one-fourth of the world's oil. Replacement of that fleet will happen very slowly if the more efficient replacement vehicles are expensive. Fuel is still only a small part of the operating cost of a vehicle.

The standard American family now requires two earners. Job security is low, so the historical practice of living near one's place of work no longer is possible. What we have is mom and dad and the kids all going in different directions to work. An American Nano-like car costing half the price of a standard compact sedan could provide 80% of the day to day automotive transportation needs, and two of these vehicles will fit into one standard American home garage parking slot, leaving one slot free for a multi-purpose vehicle not used as a daily commuter. It's a two-for, and provides triple the fuel economy of the American fleet average, while using existing technology and fewer resources.

"It's a two-for, and provides triple the fuel economy of the American fleet average, while using existing technology and fewer resources"

I agree, assuming we could get past the various safety and consumer desire hurdles standing in the way. However, to the extent that's possible, this is precisely where the feedback concept in Jevons' Paradox comes in: Saving money by buying a Nano frees up that money for other (presumptively energy consuming) expenditures, and allows multiple people to keep driving and drive longer distances than if this low cost/high mileage option wasn't available. This happens whether the savings come from the cost of the car or the cost of gas, though arguably, to the extent that the car is expensed up-front and not financed, the up front cost has a greater impact on inelasticity of demand due to the sunk-cost considerations. So does this actually help us get ahead of the curve on peak-oil mitigation, or is it akin to the recent complex mortgage instruments that allowed us to maintain the appearance of strong American consumers, only to incur a necessarily more severe correction later?

The electricity v. oil powered car issue seems equally problematic: we're just discussing ways to keep expanding within a finite world, without ever addressing the underlying problem of growth. Whether it's coal to liquid or something else, there are ways to keep pushing the peak problem onto later generations--but is this OK?

Well put. I'm on the Mankato (Minnesota) Peak Oil Task Force. At our last meeting we agreed to embark on an in-depth automotive use survey. This would be a multi-disciplinary project done through Minnesota State University Mankato. It would involve coming up with a statistically representative sample of drivers, which would be data-logged, including: type of vehicle, purpose of trip, number of passengers, GPS tracking of trip, engine computer data logging to record actual automobile operation behavior. In addition, each driver would be run through a standardized loop in the same vehicle to establish where they fit into a coded driver behavior taxonomy.

At this stage of peak oil preparedness, the main mitigation tool we will have is behavior modification. We can't modify behavior if we don't know exactly what that behavior is. I think a lot of people talk about how we use our vehicles, but I don't believe we really have a good understanding of actual vehicle use. This is essential data. We're in a good location for gathering this data. Mankato is large enough for the data to be useful, but small enough that the project is doable.

I'd be fascinated to see the results, but even more so to see what happens if you extend this project to a second phase: after categorizing the types of trips people make, try to determine the elasticity of demand for each type of trip (perhaps by using a bidding system to pay them to not take that trip, and then compare the price per trip or price per mile of different categories of trips). We need two types of info: we need to know what the behavior is, and we need to understand the relative elasticity/inelasticity of demand for divisions within that behavior.

This second phase information could, I think, really improve our ability to prioritize how to mitigate. What is the comparative elasticity between a 5 mile trip to work versus a 5 mile trip to get a latte at Starbucks? I have a guess, but it's an extreme example. This might suggest, for example, that a gas tax that subsidizes a light rail pass for commuters would facilitate more inelastic travel at the expense of more elastic travel? I may be way off on the value of that, but who knows what kind of valuable applications this information would have...

The situation in Europe would be quite different.
Although there has been some sprawl, most people actually live still in quite compact urban areas, and could travel by public transport if they had to.

Out of town shopping malls could suffer though.

There are exceptions of course, and interestingly in it's initial effects at least this could run against the idea of relocalisation, as for country people there would be real transport problems and many might seek to move to the town, so the countryside might be relatively depopulated. The difficulty of finding housing means most would be stuck for the foreseeable future though.

Although suggestions that biofuels could power the whole transport system seem fanciful at the moment, large farms could produce enough fuel for their own needs without too much difficulty I would have thought, and petrol will be found from somewhere to power the fleet of lorries to move food around.

The high tax rate on fuel here means that the price increase on fuel would be less sharp anyway, although the absolute values would be higher than in the States, as I have argued elsewhere in this thread.

I disagree with the statement that "we" can't modify behavior, as it's done all the time thru laws and taxes. We already know enough about the behavior, which is, people drive cars and trucks. You don't need to know where or when that happens to modify that behavior.

I think the answer to the "Jevons’ Paradox" where increasing transport efficiency tends to increase the use of transport is simply to limit the amount of energy available to each consumer. The traditional path has been economics, that is, let the price rise as shortages occur or add taxes to increase the price beyond what the market would give. However, we know that transportation is both central to our sense of economic production and is addicting in itself. High gasoline prices, such as in Europe, apparently have not limited development patterns, which are said to be much like those of the U.S. Some of the most expensive gas guzzlers are also the fastest, flashiest, most wanted cars, which still tend to sell well to the top income earners.

A better solution (as I've mentioned before) would be a system of rationing of all transport fuels. Jevons' Paradox would not apply, as the individual consumer would not be able to use more fuel than his/her allotment. One advantage to rationing all transport fuels would be to remove any trend toward switching from one form of transport which had high fuel prices due to taxes, to another less limited mode, such as using aircraft instead of automobiles. Rationing would encourage people to buy more efficient vehicles, whereas the price mechanism would not have a large impact on the purchases of the rich while destroying the poor, who can only buy those used vehicles cast off by the affluent. Once Peak Oil becomes obvious, the rations would of necessity be reduced as less oil is available with each year. People who might purchase high MPG vehicles would still find that they would be limited in the amount of fuel available, even though they could travel much farther on their allotment for a few more years. With a white market instituted for trading allotments, those who did not travel much and who elected to purchase a high MPG vehicle could receive a direct income credit for their efforts.

The situation in the nations that are just beginning to develop an automobile culture are not going to be any different than in the U.S. They can out bid us for oil, as their economies surge upward. Oil is going to be pumped out of the Earth at what ever rate is possible. Our U.S rate of 9 million barrels of gasoline works out to about 2 gallons per adult per day. For people riding scooters or small motorcycles, 2 gallons per week may be enough. The U.S. is simply not going to be able to continue the level of imports we now enjoy, thus, our rate of use of oil will decline.

One way or another, the World's peoples are all headed down the global depletion curve after Peak Oil. Our economic system based on prices to allocate a shortage may be the wrong method to allocate the ever increasing "shortage" after the Peak. We can either build a new society on the way down, or we can fight over what's left, destroying things along the way. I can only hope that there's still time to make an intelligent choice as the changes hit home.

E. Swanson

Great post.
This indicates that the vehicle fleet could be cycled a lot faster than assumed.

The main barrier is probably legislative, as a lot of the weight, cost and complexity of cars in the developed world is down to safety and other legislation.

However a series hybrid can be in many ways simpler and hence perhaps cheaper than ICC cars, as you can dispose of the gearbox and other heavy and expensive components.

Battery costs would be critical, but Firefly's advanced lead acid might provide enough power at reasonable cost for a plug in hybrid if the car was a lot lighter than present motors.

Composite materials would reduce weight and the energy needed to build the cars.

The western middle class (and the American above all) way of life is not sustainable, not for us, not for anybody else. Multiple disasters are unfolding.

The US and the west are gearing up for wider war in order to sustain the unsustainable ("the American way of life is non-negotiable", guess who?) One can no longer keep track of the number of fronts being opened by the empire in its death spiral. The 4 (or 5?) cable cuttings are but the most recent ratcheting up.

Even in a country like Venezuela where the leadership understands peak oil and the insanity of cheap oil for its own middle class (Chavez has used words like that), politics makes it extremely difficult to deny the middle class its desires. In China, unreality is official policy it would seem and its hard to see how it won't go off its own cliff. India will go off perhaps an only slightly different one

In a word, we're in trouble on a global scale. I don't think the US empire, after its collapse, will be replaced by any other. One hopes that out of the coming disasters a spirit of global cooperation emerges that allows us to make peace with each other and the justifiably annoyed host planet.

The technology that has relevance for the future is not cheap cars, but sustainable agriculture, reforestation, species preservation, biological substitutes for metals and plastics, and of course sustainable sources of energy which in their totality cannot come near supplying our current way of life. And of course the biggest problem without which all else wont't work, is to find a way to reduce our numbers in a civilized way, rather than letting nature handle it for us thru famine and pestilence.

Jevons paradox, BTW, applies to our entire technological order. Efficiency has multiplied the consumption of all resources. That's growth. Both growth and efficiency will have to be rethought in the coming era.

Dave, very good points, well said.

Can you provide a reputable source supporting your implication that the Iranian internet outages were the result of intentional acts by the American (or any other) government?

"the American way of life is non-negotiable", guess who?

George H. W. Bush, in the early 90s, in reference to a specific round of international negotiations being held in (IIRC) Buenos Aires. (Hat tip Darwinian for tracking that down.)

It's a complete and utter myth that the statement comes from the current administration or was said in reference to our current situation or was anywhere near as general as it's claimed to be. When "not negotiable" is said in the context of a specific set of negotiations, it's a fairly narrow statement.

People who know me have heard me say before that "transportation itself is the problem", and that solutions to the perceived need to get people and goods from here to there will ultimately need to be found in the arena of enabling people to live and goods to be created and consumed in the place where they are needed - deep localization.

Transportation is a solution to a problem that should not exist, but does, because it is easier to build and sell a car and a road system, then to organize human society in a way to minimize the need for such systems. But of course it is only "easier" to build cars and roads if you ignore the externalities, the costs that such systems impose on the environment and on our social and political lives.

There is something to the idea that cheaper cars constitute an example of the "transportation political economics" adjusting to rising energy costs, in a manner that resembles Jevons theory about energy. But there are two kinds barriers to that process continuing indefinitely... one is resource limits (peak oil, etc.), and the other is sustaining capacity/ environmental limits (global climate change, etc.) I tend to believe that the "transportation political economy" (auto industry, road industry, etc.) can adjust by building smaller more efficient cars... but only up to a point. There are real physical limits that will be reached....

... and then exceeded.

If we get past the "exceeded" part (by which I mean if some fraction of human society survives the population bottleneck) we would be wise to set ourselves on a path of sustainable social infrastructure that minimized the movement of people and goods across the face of the earth. After all, the entire earth is a vulnerable ecosystem, and every highway, railway and path across it is a scar. I'm not describing "primitivism", but I am describing a world in which long distance and high speed movement are rare and rarely required because everything and everyone you need is found where you already are.

In Time - R.E.M.

Stand in the place where you live
Now face North
Think about direction
Wonder why you haven't before
Now stand in the place where you work
Now face West
Think about the place where you live
Wonder why you haven't before

If you are confused check with the sun
Carry a compass to help you along
Your feet are going to be on the ground
Your head is there to move you around

While it is true that the number of scars on the planet need to be reduced, I disagree with your vision that people should not travel nor aspire to travel.

Traveling is part of human nature, as evidenced by the spread of our species across the globe. Travel can be and often is part of a quality life. Among other things, it helps prevent narrow, provincial attitudes, by increasing understanding of other cultures, climates, and ways of life.

And travel can be done much more efficiently than at present, and with renewable energy sources, by high-speed electric rail. Or for that matter, by electric assist bicycle (mine gets the equivalent of 500mpg+, and is powered by solar panels). Or even human-powered bicycle.

So please don't conflate the need to reduce freeways and SUV's and etc with the need to impose fundamental limits on our travel. Sure, travel in the future after PO may not be as convenient or fast, but I'd rather bike across the country than drive, anyway (given time).

I went to hear Matt Simmons speak Monday at a Minnesota Legislative Energy commission yesterday. The message came out pretty clear - big risks are coming by peak oil and a world energy demand curve that will be progressively unreachable, AND with huge risks of disruption to supply, we should be very worried.

He offered his standard list of solutions from telecommuting to water and train transport over trucks.

I don't know about Javons' Paradox. I mean it doesn't seem so profound. When costs are low and wealth high we waste thoughtlessly. When costs rise and wealth falls, we conserve more, use less. Innovation in reducing costs gives more people access to consuming more, but if it wasn't for the carless billions aspirtations, we'd be wasting the surpluses in some other way.

If I believe the lifestyle and aspirations of the richest 20% of the world are unsustainable, the spread of this lifestyle to the other 80% is merely speeding up the inevitable collapse.

Ultimately we want to live in a world where everyone has opportunity. I'd WISH their aspirations could stop with bicycles and solar powered electrified buses and rail for commuting, but I suppose it's still not clear what we'll end up with in a 100 years.

I still don't know what message the Minnesota Legislature should take from peak oil. OR I should say the only clear message is that the party is heading down and whatever investments we can make now should take this into account.

But as long as energy is cheap, we'll all keep producing and consuming whatever we can. In this regards perhaps the GW or environmental movement stands on higher ground than simple energy depletion. There's no moral high ground to self-interest - recognizing the challenges that are coming.

And I think Matt Simmons is wrong to say energy is a bigger challenge than the environment. The energy problem will take care of itself AND take care in destroying the environment in the process.

The only solution to avoiding a future we don't want is to get out of our cars now and remember what life was like before we had them.

Cars aren't the biggest problem. Coal is. Burning coal puts out nearly twice as much CO2 as burning petroleum and there's much more of it. Coal is the real killer app.

Peak Oil is an economic problem. Global Warming is a survival problem. All biological systems, human and non-human, need some form of energy input to survive. When systems exceed available energy, populations crash. But they also recover, and oftentimes, they recover very rapidly. Just look at Minnesota's deer population, which crashed during the winter of 1996 and then quickly bounced back.

Oregon7 mentioned extremely localized societies. Those societies already exist. They have names like Waziristan, Afghanistan, Sierra Leone. Their population growth rates are extremely high as is their poverty and their proclivity toward warlord culture. Their transportation networks are extremely poor.

We need to do triage. The short term task is picking the low-hanging fruit of energy conservation. Reduce elastic energy expenditure. Negawatts are the easiest watts to produce. Keep the economy from crashing into depression. Hitler's power arose out of the misery of a combined great depression and massive inflation.

The medium range task is to do all we can to avoid burning coal. Develop systems to replace coal. For one approach, look at my comment at the NY Times Dotearth blog Another critical task is to leap past agriculture, which depends primarily on annual plants to concentrate food for us, and develop systems to extract food directly out of the vegetative parts of perennial plants. Biofuels research may give us the breakthrough we need there.

The long range task is to reduce human population to a sustainable 2 billion maximum. Human populations bounce back from war, famine, and pestilence but prosperity appears to have a long-term population growth rate suppression ability. The lowest birth rate countries are in general those with the highest prosperity and best transportation infrastructure. The prosperity must be distributed throughout the population and not concentrated in the hands of a few. Prosperity is a relative, not absolute, concept and is culture specific.

There are a lot of conservation ideas out there which don't require extensions to present technology.

Here are some of them, mostly pinched from German practise:

In addition, with the present rate of decrease in solar energy costs many areas of the world should be able to be powered by solar energy, both amorphous silicon and solar thermal for both residential uses.

I find your plan for massive grids transporting power about to other far away regions to be too expensive, and wind power in particular too expensive in most places, here is an analysis for the UK using government figures:

Sacred Cow said on this forum though that costs in the US are around $1 watt, as opposed to the UK's £0.9 watt, almost double.

If those figures can be backed up authoritatively I would have to recalculate, although of course it means around at least $3 a watt in actual power generated, still an expensive power source that needs extensive back-up in addition to those bear bones costs.

Solar energy in northern regions also sounds impossibly expensive without technological breakthroughs:

In more southerly latitudes though it should do the job very nicely.

I really can't understand why everyone wants to do things the hard way - nuclear power will run things very well in northern areas, it has been producing most of the electricity for a whole country, France for decades without causing a single fatality.

It's expensive, around the alleged cost of wind in the States, but wouldn't need a massive grid to be built or huge amounts of back-up, so in practise should be a lot cheaper than a high rate of wind power penetration - you can get away with low rates without the back-up or better grid.

To sum up, we should do fine if we use all the tools in our kit, but if we insist on not doing so would suffer commensurately.

Britain's windpower potential and costs cannot be compared to the North American Great Plains. Our winds are much higher speed and more constant, our costs are much lower, and we have a much greater area with very low population densities. Windpower on the Northern Plains costs about 4 cents per kilowatt-hour. The turbines are operating at close to 40% capacity factor. The limiting factor to windpower development is transmission line capacity and regulatory processing. A recent article in the Minneapolis Star-Tribune said that there is a 612 year waiting list for windpower project approval.

That is why we need super-regional planning authorities to manage windpower and transmission line development. The larger the wind capture area, the smoother the power output and the shorter the transmission line runs. See "Supplying Baseload Power and Reducing Transmission Requirements by Interconnecting Wind Farms"
By overbuilding capacity and turning off (feathering) unneeded turbines, the issue of energy storage becomes moot. Letting a regional authority disburse revenue allows the turning off of turbines without penalizing the owners.

These are important issues to solve, because if we go to electric cars, which have become the annointed solution to post-peak oil private transportation, I can guarantee that in the U.S., under present operating procedures, those cars will be powered by coal. Nuclear power is another finite, mined resource, and, in the U.S., its up-front capital costs are extremely high and regulatory procedures require very long lead times. The electric industry will go to coal before they go to nuclear.

I am coming to the conclusion that, as you say, wind power is an entirely different ball-game in the States the US.

I am still doubtful of the costs implied by overbuilding, and building a far bigger grid.

We won't be talking about 4c kwh, that's for sure.

What I find interesting about Tata Nano is it's impossibility. India (and to large extent China) is a different place than Europe or US. There's much more people per square km and suburbs look quite different. There's no space to build enough roads and parking lots so that every middle-income family could have one or two Nanos. Once there are enough Tata Nanos on the road, traffic just won't go anywhere and nobody wants to buy Tata Nano anymore. That point is not far in many of the Indian cities.

You have a very good point there. The roads will be used for trucks at night to deliver goods, and during the day as parking lots.

The policy of "Kill Off" still seems to me to make much of the discussions of peak oil mitigation and Jevon's Paradox to be moot.

The masses -- including most especially the transportation policy wonks and local government officials, but including also those saving their shekels for a new Tata or whatever the local equivalent might be -- are kept running in the same old tracks of intentional ignorance.

"What will we drive and how much will we drive? What will they drive and how much will they drive? Is it sexy? Is it safe? Is it a good status symbol? Is it efficient? How will I (we/they) be able to afford it? How will we manage all of the traffic and infrastructure?"

Meanwhile, the real game involves various political and military maneuvers to control energy resources. The masses as so far needed to act as cogs in the economic machines that drive the military machines. As we go down the slope, the masses will work for much less. Of necessity.

Of course we are not to pay any attention to this at all, but are rather stuck with endless conversations about what to drive and how much, and what "they" will drive and how many and how much, and so on.

Most of the energy discussion has stopped making any sense at all to me. The discussion ought to be about cooperative, peaceful power down, and move on from there. This discussion ought to be on the front page of every paper every day, in every political meeting at every level -- international, national, and at every local level.

The fact that we are not discussing cooperative peaceful power down tells me that we are all together accommodating the "Kill off" strategy that focuses on the use of military might and various forms of "soft power" as too many people compete for too few resources.

I drive an electric Zap Xebra now, although I will soon build up another Organic Engines SUV (Sensible Utility Vehicle). I just sold two used OE SUVs. My wife and teen daughter share a Honda Civic Hybrid -- a luxury that they cannot seem to live without. I do occasionally drive it as well -- maybe 10 miles a month, but am ready to shed the ICE ASAP.

My political engagement involves plenty of one-on-one conversation. More people begin to understand PO and GW than even a year ago. Some people have begun to realize that GWB is the selected "Kill Off" leader who,like US Presidents of old, swept "Injun Country" clean so that the "first world" people could have the resources.

The coming collision over resources will occur in the context of depleted resources and a more toxic and hostile host planet. The complex collections of weapons of mass destruction will be partially deployed with varying degrees of success from the viewpoint of those deploying them, but with a great deal of success with regard to doing away with most of the need for the cars and busses and trains we discuss here.

I see "no change" as the theme here. By the time the local politicians here in Minnesota see the real situation, it will be far too late. From what I've seen so far they will jump on the fascist bandwagon, beating the war drums for any made-up reasons to cover up the Resource War strategy of "Kill Off."

Sorry -- but I'm not optomistic anymore about the willinglness of people to contemplate reality or act reasonably upon the basis of reality.

To sum this up: I recall seeing (via the internet)one of the ads for the new Indian Tata a photo of a young man standing by his new Tata with a caption like "Now There's A Man!"

Excellent observation by Jeff and good comments by everyone else.

There are a few aspects I would like to mention here. Petrol is already highly taxed in India. About 30-40% of the cost of fuel in India is taxes. This definitely mitigates Jevons's Paradox to an extent.

The Tata Nano is a huge status booster for many families who could not afford four wheelers until now. This will quell to a great extent, social strife in India. Let me explain. Ever since we went off the path of socialism in the early 90's, India has become more open about the display of wealth. TV serials and movies show off the lifestyle of the rich. Until a few years ago, when India took off on the growth chart, this didn't affect social patterns much because somewhere in the back of the mind, there was always a belief that these images were make-believe. But the recent growth spurt when your neighbours suddenly got richer really created a itch to go higher in status. The introduction of the Nano will make a lot of people afford that little bit of show-off.

Indian roads are very inadequate. Delhi is the only city which has roads that can afford an increase in traffic. All the others are predicted to literally come to a halt when the Nano is introduced. The very fact that it was the car and mobike companies responding to the Nano, and not city administrations shows the gulf of thought between the private and public sectors in India. The latter will wait till all Indian cities come to a halt before they even lift a finger (or probably not even 2 years after that)

Public transport in India is extremely unsafe for women. They are the biggest customer presently of two-wheelers and might be for the Nano, too.

Had the public sector been pro-active, there might have been good safe public transport in India. Because it is the private sector responding to the travel need, what we get is the Nano.