DrumBeat: June 9, 2009

$70 oil menaces budding recovery

NEW YORK (CNNMoney.com) -- Two weeks change a lot in the oil markets.

At the end of May CNNMoney.com ran a story asking if $60 oil will kill any economic recovery. 'No," most analysts said - consumers could shoulder $60 crude, and analysts didn't see prices going much higher.

Now oil is touching $70 a barrel. Goldman Sachs recently said it sees crude at $85 by the year's end. With the economy still on life support, oil is drifting dangerously close to being the wet blanket at the recovery's party.

Gasoline spikes above forecast for summer high

While the summer driving season has been underway for only two weeks, gasoline prices have already blown expert forecasts for highs for the summer.

Average prices at the pump on Monday were $2.62 a gallon, according to AAA, up 16 percent from just a month ago, and over the $2.50 a gallon high that AAA had forecast for the entire summer. Last week, AAA spokesman Geoff Sundstrom said the group revised its forecast for the summer high to $2.75 a gallon.

Canada export agency sees $70 oil as unsustainable

CALGARY, Alberta, June 9 (Reuters) - Canada's export agency has raised its 2009 oil price forecast, based on recent gains, but its chief economist said on Tuesday he does not believe the fundamentals support current levels just shy of $70 a barrel.

Export Development Canada, a federal financing agency, now sees an average price for West Texas Intermediate oil of about $55 a barrel, up from its last forecast of $47. The higher price would lessen an expected skid in the value of Canada's petroleum exports.

"Clearly, what's happened in the last 20 days has adjusted our thinking a bit," EDC Chief Economist Peter Hall said.

Venezuela says will not seize all oil service firms

CARACAS (Reuters) - Venezuela will not nationalize all the oil service companies present in the country, Oil Minister Rafael Ramirez said on Tuesday, adding that gas and water injection units taken over last month were "monopolistic."

Venezuela's state oil company PDVSA has run up large debts with service companies including Halliburton and Schlumberger and is trying to renegotiate tariffs with them.

Shell’s Odum ‘Confident’ Brazil Oil Rules Will Lure Investment

(Bloomberg) -- Royal Dutch Shell Plc, Europe’s largest oil producer, is “confident” Brazil will establish rules that will attract exploration and production investments to the country’s so-called pre-salt area, an executive said.

The Hague-based Shell, which has invested $2.8 billion in crude exploration and production in Brazil since 1998, will hold off on spending plans for the pre-salt area until rules are clear, said Marvin Odum, head of the company’s U.S. operations.

Mexico's Pemex to develop new 13,700 bpd oil field

MEXICO CITY (Reuters) - Mexico's state oil company Pemex said Tuesday it was seeking bids to build a production platform at an small offshore field discovered last year.

Pemex said it expected the Kambesah field to produce approximately 13,700 barrels of oil and 9.3 million cubic feet of gas per day when it reached peak production.

BG LNG tanker sets sail for Chile

Chile is set to receive its first ever cargo of liquefied natural gas at the end of June after a BG Group cargo set sail from Trinidad for the Quintero terminal.

Duke reaches `smart meters' settlement

Duke Energy Indiana has reached a settlement with state officials and a consumer watchdog group on its $445 million plan to install an electronic metering system for 775,000 residential electric customers.

U.S. Power Firms Want Free Carbon Permits to Last Beyond 2030

(Bloomberg) -- The Edison Electric Institute, which represents investor-owned utilities, wants the free carbon- dioxide permits under a proposed “cap-and-trade” program for greenhouse gases to continue beyond 2030.

Lester Brown: A Warming World Means More Destructive Storms

Elevated global temperatures bring a number of threats, including rising seas and more crop-withering heat waves. Higher surface water temperatures in the tropical oceans also provide more energy to drive tropical storm systems, leading to more-destructive hurricanes and typhoons. The combination of rising seas, more powerful storms, and stronger storm surges can be devastating.

...Against this backdrop, insurance companies and reinsurance companies are finding it difficult to calculate a safe level of premiums, since the historical record traditionally used to calculate insurance fees is no longer a guide to the future. For example, the number of major flood disasters worldwide has grown over the last several decades, increasing from 6 major floods in the 1950s to 26 in the 1990s.

EIA: Total US Natural Gas Consumption Seen Falling 2.2% In 09

HOUSTON -(Dow Jones)- The U.S. Energy Information Administration on Tuesday expects natural gas prices to remain below $4 a thousand cubic feet until late this year amid robust supplies and weaker demand resulting from the economic downturn.

Industrial gas consumption is forecast to decline by 8% this year, unchanged from last month's forecasted decrease, according to the EIA's Short-Term Energy Outlook.

Major industrial gas consumers, including companies in the fertilizer, chemicals and aluminum industries, have curbed gas use and cut spending.

Total natural gas consumption is expected to fall 2.2% in 2009 amid the ongoing economic downturn and increase slightly in 2010, said the EIA, the statistical arm of the U.S. Energy Department. The EIA had previously forecast a 1.9% drop in 2009.

U.S. Senate Panel Approves More Offshore Drilling

(Bloomberg) -- A U.S. Senate panel approved expansion of offshore oil and natural gas drilling, opening more of the eastern Gulf of Mexico to energy development.

The Senate Energy and Natural Resources Committee voted 13- 10 today in favor of an amendment to expand drilling, as part of its debate over pending energy legislation.

Shell Nigeria deal won't end image problem-activists

PORT HARCOURT, Nigeria (Reuters) - Royal Dutch Shell's agreement to pay millions of dollars to the families of Nigerian protesters executed in the 1990s is unlikely to end local hostility towards the firm, activists said on Tuesday.

Why Now Is the Time for Business to Go Green

There are a multitude of global trends signaling a needfor sustainable business-climate change, populationincrease, rapidly developing nations, resource depletion,environmental degradation, society's toxic burden, the loss of biodiversity, the prospect of peak oil, and more. The bottom line is that we need to learn to do more with less-both less stuff and less impact on the environment.

Refinery construction costs fall 9 pct - IHS CERA

HOUSTON (Reuters) - U.S. refiners struggling with slack gasoline demand, sinking profit margins and soaring inventories could see one bright spot on the horizon in the form of falling construction costs, according to a new report released on Tuesday.

According to IHS Cambridge Energy Research Associates, an energy consultancy, the cost of building new refining and petrochemical plants fell 9 percent between the third quarter of 2008 and the second quarter of 2009, after years of steady increases.

Shell to Wait for Right Econ to Move on Certain Projects

Royal Dutch Shell will wait until the economics is right before advancing its oil sands and floating liquefied natural gas projects, its outgoing chief executive said Monday.

"If I feel that by waiting, costs will be lower, I prefer to wait," Chief Executive Jeroen van der Veer said in response to a question from Dow Jones Newswires. "Because oil sands are projects built for decades. Over time, I am convinced, the Canadians will have more capacity to build projects."

Recession, energy prices depress rig demand

HOUSTON, TEXAS: The ongoing global recession and decline in energy demand, along with uncertainty about oil and natural gas prices, continue to put downward pressure on exploratory drilling efforts worldwide. Cancellations or delays of drilling programs, falling day rates and financing issues are plaguing the rig market. Much new work coming available is trending towards sublets and short drilling programs.

While the long-term outlook for deepwater drilling rigs remains more optimistic, jackup markets continue to soften as operators delay or cancel drilling programs to wait out the recession. However, deepwater drilling also is being affected by the credit crisis and low energy demand and prices.

Chavez Says State Oil Co Not in Trouble

Venezuelan President Hugo Chavez denied that state-owned oil giant PDVSA was in financial trouble, dismissing gloomy media accounts about impending bankruptcy as "another lie of the bourgeoisie to make people believe that the socialist project is impossible."

"A lie that from being repeated so much" tries "to make people think it's true, so that in the collective mind the idea forms that the socialist project is impossible," the president said during his weekly radio and television show on Sunday.

Venezuela Oil Shipments to Cuba Rose by 32%, Asia Sales Doubled

(Bloomberg) -- Venezuela’s shipments of crude oil and refined products to Cuba gained 32 percent last year and sales to Asia doubled under President Hugo Chavez’s strategy of diversifying the country’s oil sales to rely less on the U.S.

Will Shell pay-out change Nigeria Delta?

But will the settlement affect the current violent struggle between other Nigerian communities and oil companies?

The campaign of attacks on oil installations and kidnapping oil workers has cut Nigeria's output by about a quarter in recent years.

Dubai fast emerging as Asia's fuel trading hub

Dubai is emerging as one of Asia's key trading hub of refined crude products, analysts said. However, the emirate needs to improve on certain platforms before the market officially awards it the coveted position, traders said.

Firm tracks drivers to curb palm oil theft

PETALING JAYA: The theft of crude palm oil (CPO) in the country is alarming, forcing industry players to come up with their own mechanism to contain the problem.

Experts plumb cap-and-trade bill in search of bottom line

Looking for a price tag on the massive House climate and energy bill? Good luck.

Conflicting financial analyses abound. Some predict the measure will bring financial ruin, others say it will actually save money for most Americans.

U.S. to Get Half of Gas From ‘Tight’ Fields by 2020, Shell Says

(Bloomberg) -- The U.S. will get more than half of its natural gas supplies from so-called tight reservoirs by 2020, Royal Dutch Shell Plc estimates.

New technology will allow tapping 500 trillion cubic feet of unconventional gas resources in North America, enough to supply the U.S. for two decades, said Malcolm Brinded, executive director for the upstream business at Europe’s biggest oil company. Shell expects to more than triple tight gas output to more than 300,000 barrels of oil equivalent a day in 2020.

“Having picked much of the low-hanging fruit, our industry is now focused on more difficult resources, tight reservoirs, fractured carbonates, oil shales, oil sands, and ultra-heavy oil,” Brinded said in a speech posted on the Hague-based company’s Web site today. “Tight gas in North America has rapidly developed into a real game-changer.”

Natural Gas Oversupply to Remain, Morgan Stanley Says

(Bloomberg) -- The surplus in natural gas may stay longer than expected as the U.S., Australia and Qatar boost output from unconventional sources and in liquefied form, Morgan Stanley said.

“I will expect gas to stay in excess for years to come, even after the economic recovery,” William Wicker, Morgan Stanley’s managing director and vice chairman of global natural resources, told the Asian Oil & Gas Conference in Kuala Lumpur today. “This is not a short-term phenomenon.”

Energy fuels new 'Great Game' in Europe

The giant Russian energy company, Gazprom, which controls the world's largest reserves of natural gas, has issued a stark warning to the European Union saying it must decide if it wants to continue receiving supplies of Russian gas.

Speaking in a BBC interview, Gazprom deputy chairman Alexander Medvedev warned that Europe was now at a crossroads.

"Only three countries can be suppliers of pipeline gas in the long-term - Russia, Iran and Qatar. So there is no other choice than to deal with these suppliers," he said.

Gazprom targets 10% of US gas market

Russian gas export monopoly Gazprom plans to raise deliveries to the US and eventually supply up to 10% of the world's biggest economy's gas needs, a senior company official said on today.

Greek power workers set summer strikes over jobs

ATHENS (Reuters) - Workers at Public Power Corp, Greece's biggest electricity company, said they will strike next month to press for 7,000 new hirings.

Labour walkouts last year led to widespread power cuts, forcing state-controlled PPC to shut down units and boost imports from Bulgaria and Italy.

Mich. agency: Drivers can afford gasoline tax hike

Drivers can afford to pay higher gasoline taxes to improve their roads, Michigan's top transportation official said while warning more than 125 projects will be delayed if funding is not increased.

State Department of Transportation Director Kirk Steudle on Tuesday estimated motorists would pay an extra 16 cents per week - "a stick of gum" - for every penny increase in the 19-cents-a-gallon gas tax. He urged lawmakers to support a proposal to convert the gas tax to a percentage tax on the wholesale price of gas, which would rise at capped amounts as prices at the pump increase.

Natural Gas Cheapest to Oil Since 1992 Signals Gain

(Bloomberg) - This year’s 34 percent decline in natural gas made it the worst performing commodity and the cheapest next to oil since the fall of the Soviet Union. That’s about to change, if history is any guide.

Natural gas lost 73 percent in 11 months as the U.S. fell into the deepest recession in 50 years and drillers failed to idle rigs fast enough to control inventories. Stockpiles are 22 percent larger than the five-year average, the Energy Department said. Oil costs 18 times more than gas, the biggest gap since 1992, when the collapse of communism cut supplies from Russia, according to data compiled by Bloomberg.

China May Seaborne Crude Oil Imports 13.8 Mln Tons - Ministry

SHANGHAI (Dow Jones)--China imported an estimated 13.8 million metric tons of crude oil through seaports in May, or around 3.26 million barrels per day, up 5.1% from the same month last year, the Ministry of Transport said in a report on its Web site Tuesday.

However, seaborne imports fell 9.8% from April, according to calculations by Dow Jones Newswires, which may indicate crude demand is slowing from the high levels recorded earlier this year.

Shell to pay $15.5 million to settle Nigeria claims

(CNN) -- Oil company Royal Dutch Shell will pay $15.5 million to settle a lawsuit against its Nigerian subsidiary by the family of executed Nigerian environmental activist Ken Saro-Wiwa and other dissidents, the plaintiffs announced Monday.

Global airlines fear oil rally as losses mount

KUALA LUMPUR (Reuters) – Global airlines called for concerted action to prevent another runaway surge in oil prices as the International Air Transport Association nearly doubled its forecast for industry losses to $9 billion in 2009.

The head of the Geneva-based airline lobby on Monday lambasted "greedy speculation" in oil markets and accused governments of squandering money raised from aviation while carriers suffer from still slumping demand.

Ethiopian rebels threaten foreign oil companies

ADDIS ABABA (Reuters) – An Ethiopian rebel group on Wednesday warned international oil companies against exploring in a region of the Horn of Africa nation where the rebels attacked a Chinese-run field in 2007 killing 74 people.

The Ogaden National Liberation Front (ONLF) -- whose hundreds of fighters seek autonomy for the ethnically Somali Ogaden region -- said oil firms had cleared some 1,600 square kilometers, displacing locals and destroying vegetation.

"Certain multinational oil corporations are intent on exploiting Ogaden fossil fuel resources in alliance with the current Ethiopian regime that is committing genocide and war crimes in Ogaden," it said in an emailed statement.

Shell pays Nigeria rights victims $15.5 mln

NEW YORK (AFP) – Royal Dutch Shell has agreed to a 15.5 million dollar payout to settle a lawsuit alleging complicity in murder, torture and other abuses by Nigeria's former military government.

Purchase of Hummer against China's development trend

HANGZHOU - A domestic company's purchase of the gas-guzzling Hummer brand is against China's economic situation and the country's development, said an official with the Development Research Center of the State Council, the country's Cabinet, Tuesday.

"If the Chinese company is just trying to stir media hype, that is understandable; if it really takes this step to buy, relevant departments should be strict and cautious with the approval, or reject the application if necessary," said vice director Lu Zhongyuan, at the China Opening-up Forum in Ningbo of eastern China's Zhejiang Province.

Oil Platforms Vulnerable To Hackers

ScienceDaily — Oil company data security is inadequate, and production systems are at risk of attack by hackers, viruses and worms.

Energy realism - finding common ground

Americans share common ground when it comes to this country's energy goals. We aspire to an environmentally responsible approach to energy that will help our country be more self-sufficient while not putting the cost of energy out of reach for American consumers and businesses. But we seem to have less common ground in the discussion about how, and when, we can realize those aspirations. I support these energy objectives, but believe that policies to achieve them can be successful only if they are rooted in fact and in reality - what I call "energy realism."

Energy realism starts with an understanding of scale. Every day the world uses, from all energy sources, the equivalent of 245 million barrels of oil. Worldwide, we use 50 percent more energy than we did only 20 years ago. And 20 years from now, demand will have risen by 30 percent or so more.

Richard Heinberg: Look on the Bright Side

Recently I've begun compiling a list of things to be cheerful about. Here are some items that should bring a smile to any environmentalist's lips...

ResilientCity.org International Design Ideas Competition

ResilientCity.org is holding a design ideas competition to raise awareness in the architecture, planning and engineering communities of resiliency as a central strategy for dealing with the future impacts on our cities of peak oil and climate change. It is the intent of the competition to generate imaginative and useful design and planning exemplars that effectively illustrate ResilientCity planning and design principles.

Brighter days seen for solar, next-gen biofuels

NEW YORK -- Big changes are afoot in the fledgling alternative-energy industry.

As the sector recovers from the 2008 financial market meltdown, insiders look for next-generation biofuels and solar technologies to start joining mainstream energy markets, while wind power continues to lean heavily on government support.

Solar brightens a bleak Michigan town

Rife with auto layoffs, Saginaw residents hope a big expansion at the nearby Hemlock solar plant can help jumpstart their battered economy.

Nuclear fusion power project to start in slimmed-down version

MARSEILLE, France (AFP) – A multi-billion-dollar project to prove whether nuclear fusion, the power that fuels the Sun, can be a practicable energy source is to be scaled down in its early stages, sources said on Monday.

The test reactor, to be built at a site in southern France, will start its experiments in 2018 as scheduled but will initially be built in a slimmed-down form, they said.

Exelon: No public threat from Ill. tritium leak

CHICAGO – A tritium leak was found during routine monitoring of Exelon Corp.'s nuclear power plant, but contaminated water was contained to the property and did not pose a public health threat, company officials said Monday.

Climate bill to pay hundreds of dollars in rebates

WASHINGTON – Low-income families will receive hundreds of dollars a year to help pay higher energy bills if Congress enacts the first-ever limits on the gases blamed for global warming, according to a new analysis.

China response to Obama climate envoy positive

BEIJING – China said Tuesday that it was committed to making this year's Copenhagen climate change conference a success, sounding a positive note at the close of a two-day visit to Beijing by President Barack Obama's global warming envoy.

Foreign Ministry spokesman Qin Gang gave few details and reasserted China's insistence on "common but differentiated responsibilities" under which developed countries such as the U.S. would bear most of the responsibility for reducing greenhouse gas emissions.

I was out of town yesterday and completely missed Drumbeats. So this morning I decided to scan Leanan’s headlines to see what I might have missed. And one literally jumped off the screen at me:
Who Killed the Hydrogen-Powered Car?

Last month, the Department of Energy (DOE) finally conceded that hydrogen won't be a part of the near-term solution to global warming, the peak oil crisis, or anything else you can think of. They're cutting back funding dramatically on hydrogen research. This is a triumph of physics over policy. In the long run, physics will always win, but we have way too many policy wonks in Washington without a clue about how the physical world works.

I thought “Wow, I had no idea that the hydrogen car was dead”. Then when I read the story I found it made the very same argument I had made way back when the hydrogen car was all the rage, back when Amory Lovins of the Rocky Mountain Institute was touting hydrogen power as the panacea that would save the world. My argument was that only about 20% of the electricity generated would actually deliver torque to the wheels. Well, I was wrong, it’s 23% according to this article by James Anderson. Of course there are lots of other problems with trying to power a car with hydrogen but that more than anything else is what killed the hydrogen car.

Anderson used data from an article published by Ulf Bossel entitled, "Does a Hydrogen Economy Make Sense?" in Proceedings of the IEEE, Vol. 94, No. 10, October 2006.

I went to Amazon.com and checked out “Hydrogen Powered Car”. I found many, but here are just a few:
Hydrogen: Running on Water (Energy Revolution)
The Hydrogen Age: Empowering a Clean-Energy Future
The Hydrogen Energy Transition: Cutting Carbon from Transportation
Tomorrow's Energy: Hydrogen, Fuel Cells, and the Prospects for a Cleaner Planet
ZOOM: The Global Race to Fuel the Car of the Future
The Hydrogen Economy (Jeremy Rifkin)
A strategy for the hydrogen transition (Amory Lovins)
Power to the People: How the Coming Energy Revolution Will Transform an Industry, Change Our Lives, and Maybe Even Save the Planet (Vijay V. Vaitheeswaran)

Vaitheeswaran imagines every home and factory with it’s own solar or wind powered hydrogen generating plant.
But alas, physics not only won over policy, it won over idiotic hyperbole as well.

All excited now, and since hydrogen power was once a very favorite topic on TOD, I was anxious to see what great comments from TODers I had missed out on yesterday. Alas, not a single comment was made on the article.

Oh well….

Ron P.

The hydrogen car is dead. They say you should only speak good of the dead.

Good, it's dead!

Darwinian,I also spent years trying to explain to anyone who would listen that hydrogen cars are not practical,but out in the general population,only a tiny percentage of people have ever finished a couple of classes in the physical sciences. The rest have mostly forgotten whatever they learned unless they are either scientists or engineers with maybe a few other technically oriented professionals thrown in.

Ignorance allowed the people pushing hydrogen to fool the public.The combined energy losses of all the stages of the process were obviously far greater than the savings at the final step-using the hydrogen to power a fuel cell to power an electric motor to drive the car.Of course the ice is inefficient too,and fuel cells might prove to be more efficient overall eventually,depending on how the cards fall.

There is still plenty of room to improve the ice,especially if you assume the existence of non existent materials such as ceramic pistins cylinders and valves which would boost fuel economy substantially.

The ones who do know some science but still believed were (so far as I can see) just overoptimistic regarding the speed at which engineering problems can be solved.I have been guilty of this same overoptimism many times but am gradually developing an immunity to it.

Nobody has commented because nobody likes to be reminded of thier errors.I am sure some one will remind me of comments I made here on the OD recently regarding the upside of algae farming.

This tendency to overestimate the speed of development and the reduction of costs seems to be built into us at some very basic level.I guess it has something to to with having once sent a few men to the moon-REGARDLESS of the costs.

Now if the probability that two problems can be solved working seperately on each one is eighty percent each,the probability that both problems will be solved is 0.8times 0.8 or 0.64,or only 64 percent.

When you look at the length of the string of problems that must be solved to build a practical hydrogen car,it becomes obvious rather quickly that the eventual result of multiplying this string of less than one numbers gets fairly close to zero at least in the short or medium term.

For those who might have forgotten the problems,some were /are energy loss at initial seperation of hydrogen from water molecule or the opportunity cost of sacrificing ng to get the hydrogen somewhat cheaper,costs of high pressure bulk storage,low storage density, liquefication temperature so low as to require non existent technology to distribute over large areas(not just inside a chemical plant or at a place rockets are launched) in liquid form,current oil gas infrastructure not usable for shipping /storage,compression losses at fueling points,prohibitively high costs of fuel cells,large size of tanks required to hold enough in gas form to go very far, invention,design and manufacture of tanks to store as hydrates,etc.

The situation is similar in the beginning for every new technology.We can expect the that the ones which will eventually grow into viable large industries to be the ones that are viable on a small scale even if the product is very expensive.

So far as I know the first viable use of pv was on space probes and satellites.Now I have a solar powered calculator and will soon have a solar powered electric fence around a pasture not within reach of my personal on the farm "grid".If I had twenty or thirty thousand to spare I would get off the real grid now.

More than likely an increasing stream of incremental improvements in performance and costs will result in solar pv becoming a dominant source of energy someday,maybe even within the next couple of decades.Maybe I will live to see it happen.

I cannot envision(not that I am known as a visionary sort of person!) a similar path for hydrogen since other sources of small amounts of power are so cheap and easily utilized.

Eventually most or all of the problems associated with hydrogen will be solved as a result of either the general advance of scientific and engineering knowledge or as the result of working on the same problems while trying to move forward in another field (then) CURRENTLY commercially viable.

I do not expect to live to see this happen in respect to hydrogen as a motive power source.

All comments are predicated upon bau rather than power down.

Remember that I am just a crabby old farmer and not to be taken too seriously unless the subject is ag.

Nobody has commented because nobody likes to be reminded of thier errors.

No, I think nobody commented because bashing hydrogen was what we mostly did here. The mantra was always, "Hydrogen is an energy carrier, not an energy source."

The few who did actually believe in a hydrogen economy likely wouldn't be put off by that article.


You nailed me on that one,I should have realized that HERE such would the case be.Please don't hit me again until I quit seeing double.

I am new to blogging,never had the time and good internet access until VERY recently.

I do think my analysis is still valid for the general public/joe sixpack/english teachers/politicians in general etc.

I can tell your new at it.

I started back in the early 80 on my corporations internal network which I maintained for my site Research Triangle Park in N. Carolina.

Us programmers and engineers used in enormously and when it drifted into a bit of politics then the PTB got bothered. We learned to 'doublespeak'.

Your not familiar with that are you? Doublespeak.

Airdale-There are 7 ways to 'skin a cat' or rather make a case. Frontal is worse.

The few who did actually believe in a hydrogen economy likely wouldn't be put off by that article.

Of course they won't. The article was by a blogger and bloggers are generally ignored by true believers. However the data came from an article in IEEE Journal. That is the Institute of Electrical and Electronics Engineers. That is a science journal, not a blog. I do think people will pay attention to that journal. Well, at least someone already has as the article indicated, funds have been dramatically cut for any research.

Ron P.

I was talking about the people who comment here on TOD promoting hydrogen. There have never been many, and those who did seemed perfectly happy to ignore science. Unless it supported their POV, of course.

Eventually most or all of the problems associated with hydrogen will be solved as a result of either the general advance of scientific and engineering knowledge or as the result of working on the same problems while trying to move forward in another field (then) CURRENTLY commercially viable.

I do not share you optimism Mac. The laws of thermodynamics simply cannot be violated. There is no cheap way of separating hydrogen from the oxygen in the water molecule. There is no cheap way of compressing hydrogen or cooling it to cryogenic temperatures. And the fuel cell is only 50% efficient. That may be improved upon but only slightly. Usually it is not that high.

The tank-to-wheel efficiency of a fuel cell vehicle is about 45% at low loads and shows average values of about 36% when a driving cycle like the NEDC (New European Driving Cycle) is used as test procedure.[18] The comparable NEDC value for a Diesel vehicle is 22%. In 2008 Honda released a car with fuel stack claiming a 60% tank-to-wheel efficiency.

It is also important to take losses due to fuel production, transportation, and storage into account. Fuel cell vehicles running on compressed hydrogen may have a power-plant-to-wheel efficiency of 22% if the hydrogen is stored as high-pressure gas, and 17% if it is stored as liquid hydrogen.[20] In addition to the production losses, over 70% of US' electricity used for hydrogen production comes from thermal power, which only has an efficiency of 33% to 48%, resulting in a net increase in carbon dioxide production by using hydrogen in vehicles.
Fuel cell efficiency

But the main reason we will never see hydrogen powered vehicles as a normal mode of transportation is that science eventually wins over rhetorical hyperbole. The efficiency is way too low and the price is way too high. No one will manufacture a product that will cost them billions but no one will buy.

Ron P.


You are as usual correct.

It is unlikely that the energy efficiency of the process of the seperation of hydrogen from water will be improved very much,and as you say it is gauranteed that the process will always be a net energy loser by the laws of physics.

However I did not predict that hydrogen WILL ever power cars but that hydrogen technology might eventually prove more energy efficient than the ice overall-which I suppose is almost the same thing,to be honest.

But it is not exactly the same thing,because using the hydrogen to fuel a car presupposes the cost effective manufacture of the drive train.

If the various engineering problems are eventually solved,and if ff are in very short supply,and if solar or wind grows up in a big way,then maybe hydrogen will eventually be cheaper or cleaner or maybe both than gasoline and diesel.

As I said,I don't expect to live to see it happen.Every link of the chain is an if, and it's a long chain.

Otoh,I see blurbs here and there about very powerful new types of batteries that will no longer use both anodes and cathodes but rather substitute atmospheric oxygen for the cathode-unless I have forgotten the correct technology.Such batteries would evidently be cheap in terms of performance.

When I was taking freshman chemistry in 1968,the permeable membrane technology used today to desalinate sea water either did not exist or was only demonstrable in the lab,I can't remember which.

I do remember bsing about it with a dorm mate who was a chemistry major,and that my ag professors dismissed it as pie in the sky.They were wrong about desalination,and they were wrong about using antibiotics in livestock feeds.

My biology professors were livid and called the ag professors names for enabling the sin of breeding antibiotic resistant pathogens.They were right.That hasn't stopped us from dosing nearly every pig,chicken and cow in the US-not that it has anything to do with the current discussion inparticular,but it is relevant to the broader sustainability discussion here at theOD.

They(some of the ag profs) were right about the dangers of enabling third world farmers to make the transition to fossil fuel and synthetic fertilizer based ag.One in particular used to remark "teache'em how to double thier food production and in twenty years you'll have twice as many starving xxxxians".

I cant say the word or the ethnic group here in polite company,he was a profane but capable man,and political correctness was not a big issue back in those days,especially inside the ag quad.

Who can say that fuel cells will NEVER be cheap?

I have learned to be afraid of the words never and always except when associated with the laws of nature.That does not mean I am unwilling to place bets that involve these words.

Yogi sez predictin is hard,specially bout the future.

However I did not predict that hydrogen WILL ever power cars but that hydrogen technology might eventually prove more energy efficient than the ice overall-which I suppose is almost the same thing,to be honest.

Mac, you are using the wrong comparison. You should be comparing hydrogen with batteries, not the internal combustion engine. The comparison is 23% verses 69%. And it cost a whole lot less to build a battery powered vehicle than a hydrogen powered vehicle. And there is no danger of a battery powered car blowing up when it is being recharged.

Ron P.

And there is no danger of a battery powered car blowing up when it is being recharged.

Lets just say LESS danger of a battery powered car blowing while being recharged. Ive seen "safe" batteries like NiCd blow up before. And we know LiPo has its moments too.

your point is valid though, Why use a hydrogen fuel cell to power an electric motor when you can achieve better efficiency/density with batteries?

Whatever improvements or magical eureka moments you assume may occur in fuel cell technology could just as easily occur in battery technology.


I understand the physics principles involved but I am not well versed in the actual resultsachieved in terms of energy efficiency when the various processes are compared,such as batteries versus fuel cells.

I knew a long time ago that fuel cells would not get the job done due to high costs even though the efficiency of a fuel cell/electric motor drive train is higher than an ice-at least it is supposed to be according to the periodicals I used to read.

I also knew that batteries are the hot solution to the transport problem for now at least.I had presumed that the primary reason for the rise of the battery versus the fuel cell had to do more with cost than overall efficiency.It's good to find out that batteries are also substantially more efficient.

You have probably noticed that I sign off sometimes by saying I am not to be taken too seriously -unless the subject is ag.That subject alone is big enough that it is impossible to keep up except in the most general terms.

Live and learn.This is good place to learn.

For that matter, who can say that the Pink Unicorn Starship Fleet won't land on the White House lawn tomorrow and impose a New World Order? Including magickal new techologies that will solve all of our problems!

But I wouldn't bet on it. Or on cheap fuel cells ;-)

Why not bet on it?

About the same odds as our gubbermint pulling something off. Perhaps better odds at that.

Airdale-your bet and raise , I always did like 'guts

"About the same odds as our gubbermint pulling something off. Perhaps better odds at that. "

I don't think that either of us is betting on the gubbermint pulling a miracle out of their a**, I mean, hat. No, I think I'll go with the Pink Unicorns :-)

H2 needn't be compressed or cooled to the point liquification for storage. The best (safest) way to store it is in the form of metal hydrides. The weight of metal hydride precludes mobile application of this technology. But stationary apps may be practical, perhaps for running Sterling engines in remote locations. It's true that hydrolysis of water is energy expensive but if baseload is covered, excess generation capacity - from solar on a summer day, for instance - could be diverted to hydrolysis. A 50% efficiency doesn't approach that of the mitochondrion but it beats that of the ICE, after all.

If you don't need mobility, why bother with metal hydrides when you can use a rubber balloon?

A 50% efficiency doesn't approach that of the mitochondrion but it beats that of the ICE, after all.

The 50% efficiency refers to the fuel cell only. That does not include all the other losses. The other losses are the reason you wind up with 23% rather than 50%. And that does beat the internal combustion engine.

But comparing hydrogen with gasoline is comparing apples and oranges. When considering hydrogen you must consider the energy required to generate the hydrogen. Gasoline is refined from crude oil pumped from the ground. A comparison? No, you simply cannot do that with any degree of accuracy.

Ron P.

Why it should be one or the other when it could be both. We know solar has two major problems - cost and storage. The cost problem is likely to be resolved in the near future; while the real killer for the time being seems to be storage. Ironically the best candidate for resolving the storage problem is exactly hydrogen - large scale electrolysis with pumping H2 in underground caverns during the day and then burning it in combined cycle gas turbines at night should be the most cost-effective way of storing solar energy from PV. The combined efficiency would be around 40%, but assuming abundant energy from low-cost solar cells this should not be prohibitive.

H2 in underground caverns ...

It better be a sealed and tight cavern. Hydrogen is t_h_e most difficult substance to contain.

Pumped storage works best with my brain, it's straight forward with no surprises attached.
Uphill : I have not actual pump type at hand - thus losses unknown to me ... but
Downhill: The Pelton-impeller/generator is 90% efficient from hydrojet (kinetic energy) to electricity. Pelton is my hero !

Hate to nitpick, but helium is a slightly smaller (and more difficult to contain) than hydrogen.

I love nitpicking :-) and I am no chemist, but my logic went by the Periodic table.

Hydrogen : With an atomic weight of 1.00794 (Standard atomic weight 1.00794 g·mol−1), hydrogen is the lightest element.So in the form of gas, double that weight. Hydrogen gas,H2 is 2.02 g·mol−1.

Helium : Standard atomic weight 4.002602 g·mol−1. Helium is 4 times the weight of Hydrogen

So , Is there any particular reason for your claim ?

It has to do with the full electron shell of the Helium atom.

2 Electrons optimally fill the first quantum state, resulting in a more compact waveform for the total structure. Sorry, I can't come up with a better explanation than that. Quantum Mechanics is hard for me to translate into English.

Additionally, the full outer shell means that He doesn't interact with surrounding atoms like H does, making it slipperier as well as smaller.

large scale electrolysis with pumping H2 in underground caverns during the day and then burning it in combined cycle gas turbines at night should be the most cost-effective way of storing solar energy from PV.

I have never heard of using h2 as fuel for a gas turbine. But using it in fuel cells to produce electricity would mean you could store 23% of the electricity used to generate it. That is, assuming that your fuel cells were running at 50% efficiency.

Do you have any figures on h2 as fuel for gas turbines? It seems to me that would take a really lot of hydrogen. And storing it in underground caverns? I believe that would be near impossible. Hydrogen is the smallest atom, it can penetrate damn near anything. Solid rock would look like a sieve to hydrogen.

Ron P.

Okay, I'll paint a target on my back ... just make it quick and painless, guys.

I read the article, and there were a couple of points that bothered me.

1. In the steps listed, they included transport. If the hydrogen was going to be made from natural gas, that probably would be valid, since scale of plant would determine efficiency. But for electrolysis, I don't think scale of plant is such an issue, so it could be produced right at the fueling point. But then you'd have to include transmission of the electricity. The article put transportation at 20% loss and transmission at a 10% loss, so right there 10% is picked up.

2. I am not an engineer, so I don't know if their conversion loss figures are correct, but they include a step for production of the hydrogen by electrolysis, and then a compression step. I recall reading the website of a manufacturer of one of the elctrolysis units that they could produce and compress (to 7500 psi, IIRR) for 55kwh per kg of H2. Does that figure jive with the combined production and compression conversion losses the article shows of 25% and 10%? (losses, they show as 75% and 90% efficient)

3. They ignore the other system aspects, and the impact on efficiency. A battery powered car with any extended range, is going to have to haul a fat assfull of batteries wherever it goes to get range, the weight of those batteries is going to cut mileage per kwh, require a heavier frame, beefier tires, stronger suspension etc. etc. None of that was taken into account. A hybrid fuel cell, even a plug-in hybrid fuel cell, would carry less battery weight, since the fuel cell would be used as the range extender, not more batteries. Would the fuel cell (and associated tanks and fueling system) be lighter than more batteries? (Or does it even matter with regenerative braking?)

4. Can a battery powered car be recharged in five minutes with a copper cable smaller than the diameter of your wrist? Again, I'm not an engineer, but I've seen that calculation done before, and I don't think my mom would be able to wrestle such a cable. So maybe you'll just have to wait to recharge, or go to a whole battery changeout method, which will require standardized designs, and a whole infrastructure of service stations that can do the changeout. (yes, there are infrastructure questions regarding hydrogen too)

5. Then there's the question of "Can you create a useful (practical) vehicle based on this technology?" I don't know if you can create minivans the size of the Dodge Caravan, with batteries, with stow and go seats, with interior space, and with range. Sure there are market niches for short distance commuter vehicles, but as vehicle costs rise, I see vehicles becoming more multipurpose, not less. A Tesla Roadster may seem great for two, and if they get the Tesla sedan going, maybe that will work for more of the transportation market (currently at 3x an ICE sedan's price...), but what's a soccer mom to do with the team in one of those?

6. Cost of operation is not discussed. How much per mile are the battery packs going to cost?

Okay, got my bulletproof vest on. Fire away...

Here's a story I saw this weekend about that old pilot CSP plant in Barstow California:

Salt, sun and science combine for power

The Santa Monica-based energy company SolarReserve has licensed the technology, developed by engineers at Rocketdyne.

SolarReserve, which is financing and marketing the project, said it is currently working on agreements with several utilities to buy electricity generated from the plant. It hopes to have several announcements in a few months that could help jump-start construction of the first plant that would likely be on private land in the Southwest, Murphy said.

The company last fall secured $140 million in venture capital.

The plant could begin operating by 2012 or early 2013. It would use an array of 15,000 heliostats, or large tilting mirrors about 25 feet wide, to direct sunlight to a solar collector atop a 600-foot-tall tower-somewhat like a lighthouse in reverse.

The story includes this comment:

The solar-thermal technology actually was proven workable more than a decade ago at the Barstow pilot plant. But the complex was shuttered in 1999 when the cost of natural gas fell to one-tenth of what it is today.

The price of natural gas in 1999 was something like a third to a half of what it is now. The fact that the story includes statement talking about natural gas being a tenth of the current cost doesn't help the article's credibility.

Hopefully the rest of the story is better researched. It would be nice if this new version of solar power (which uses molten salt) can be shown to work at reasonable cost.

Russian gas exports down 56.7% to 26.4 bln cu m in Jan.-Apr

MOSCOW, June 8 (RIA Novosti) - Russia's natural gas exports to countries other than former Soviet republics declined 56.7%, year-on-year, in January-April 2009 to 26.4 billion cubic meters, the Federal Customs Service said on Monday. Exports to the Commonwealth of Independent States (CIS), a loose association of former Soviet republics except the Baltic States, dropped 37.4% to 4.2 billion cubic meters, the Federal Customs Service said. Overall, Russia exported 30.6 billion cubic meters worth $9.48 billion in the first four months of the year, the Federal Customs Service said. . .

Russia's Economics Ministry expects crude oil output to decline 1.1% in 2009 to 482 million metric tons (3.5 billion barrels) with exports to shrink 2.5% to 237 million metric tons (1.7 billion barrels).

Lower demand for natural gas, ELM factors, both? The article notes a double digit decline in NG production.

I really think it's reduced demand in this particular case.

Anyone have any numbers for total EU consumption versus current natural gas exports from countries like Norway?

In any case, the most recent EIA numbers for Russian NG production, consumption and net exports are for 2007 (they showed about a -4%/year decline in net exports from 2006 to 2007). In round numbers (TCF), the 2007 data are:

Production: 23
Consumption: 17
Net Exports: 6

Note that a decline of 2 TCF in production (down at -9%/year) from the 2007 rate would result in an annual net export decline rate of -41%/year, assuming no change in consumption.

My bet is that we are seeing a combined drop in both EU demand and Russian NG export capacity, in much the same way that I suspect that the global decline in crude demand is masking an accelerating decline in global crude production. As I have previously noted, mathematically conventional world crude production was to 2005 as the Lower 48 was to 1970 as the North Sea was to 1999. And the initial three year Lower 48 and North Sea crude declines were fairly low (corresponding to 2006-2008 for the world), with the following six year declines being much more rapid. And then we have the ELM factors.

In my country (the Netherlands) it was the coldest winter in 12 years. Don't know about the rest of Europe though.

Not because of weather, but because of the economic crisis.

There's a world wide glut of natural gas now, because of the global economic slump. Even in Asia, where supplies had stayed tight for awhile. Residential use of natural gas has remained fairly steady. It's all those closed factories that have made the demand difference.

So what do you make of Gazprom's Tough Talk to Europe? Is it the schoolyard bully realizing that the 98 pound weakling might have brought in his daddy's .38?

Sounds like fear talking to me.. but if Europe calls the bluff, they've got some work to do in shoring up their pinch hitters. I mean, ultimately, Russia has to sell to the markets that can pay the freight.. they might play this 'shutoff' gambit again and sit on their pipes for a few weeks every January, but isn't that really just giving Europe all that much more incentive to get out of the relationship?

I keep shaking my head during these winter cutoffs, knowing that anyone who has frozen to death on the surface will actually thaw out in the little 2-meter deep hole they get buried in. Some of the solutions really aren't that far away from us.

We should hold a Seance.. let the dead tell us how comfy they are..


I have a comfortable old easy chair in the basement of my Daddy's packhouse which never gets over about 65 in mid summer or below about 45 in mid winter,unless we open the windows to chill the fruit.He built it to store his apple crop.It's dead quiet even when a xxxxing airliner flys over.

I'm posting this only so that someone will point out my math error. It's been interferring with my sleep.

If the EIA numbers are correct (and that only 6 % of US coal reserves are economically recoverable with current technology) then, at current extraction rates, we have less than 15 years worth of coal left.

So where did I goof up?


Is that after or before we shear off every mountain top in Appalachia?

Before or after Muhlenberg county goes Total Yellow with runoff?

Before every last insect,bat,bug,bird and tree is gone or after?

Airdale-the truth is not decided by majority vote

Well, if numbers are correct then we probably don't have much time to shift to any alternate energy infrastructure. Once energy resource availability drops too quickly then everything will probably start grinding to a halt. In that case probably "Before".

With Post PO I always assumed that coal-to-liquid fuel operations would become more prevalant and make up for some of the oil shortfall. I guess not... unless someone can point out a math boo-boo.

I haven't seen the lopped off mountain tops but would they lend themselves to solar and or wind gen.??It seems like a good reclamation idea.

the truth is not decided by majority vote

Indeed. Truth has nothing to do with the opinion of the majority. Truth is not decided, Truth decides.


I think we're screwed. About 20 years worth left.

Your estimate is too low. There is a difference between coal in place and coal reserves. Coal reserves are a small part of coal in place, since coal reserves only relate to coal which can be mined in mines that are currently open. The USGS is talking about coal in place.

Another issue is that the USGS is talking about coal recoverable at current prices, which are quite low. Several times as much coal seems to be recoverable at higher prices.

Cost curve showing reserves estimates for the Gillette coalfield at different coal prices per ton.

Most of the cost of Western coal such as that studied in the analysis is typically the transportation cost to where it is to be used. Even with transportation costs included, coal on average costs only about 2 cents per kWh, (based on a calculation I did using EIA data) when used to generate to electricity. This is cheap. Even if Western coal cost (Powder River Basin Coal) were five times its current cost, it would still be affordable. At that price, the graph suggests that seven times as much coal would be available.

Graph showing spot prices of coal, from EIA website. Analysis relates to Powder River Basin coal, currently selling for $8.75 per short ton.

The total amount recoverable is certainly more than 15 years worth. I don't think the study shows anything about a near-term shortage of coal. I am more interested in hearing if there are actual market issues taking place. This might mean, for example, that some types of Eastern coal (the high priced coal) is in short supply.

I have always suspected that at some point - probably after those tight NG formations play out - we will have to come up with some sort of in situ CTG scheme.

Just looking at the price to say how much is economically recoverable is misleading though. Let's say for example that the price of diesel fuel doubles - what does that do to the curve? Or the price of steel?

In some sense coal is like oil - we take the good and the easy stuff first. The stuff that remains is of lesser quality, is in thinner coal beds or has a lot more overburden that needs to be removed.

I sort of hate to bring this up for the 3rd day in a row, but at the very end of the HOMEPROJECT video:


they list Glenn Close as the narrator, and that Lester Brown was one of the scientific advisers. It sort of all fits together - the topics covered are also the main ones that Brown talks about in his "Plan B 3.0" book...

Interesting article on Cap and Trade-supposedly Europe's system has done everything great except lessen greenhouse gas emissions-the USA needs this marvel desperately http://finance.yahoo.com/news/Europes-CapAndTrade-Scheme-A-ibd-15471789....

Denninger sounding a lot like Stoneleigh these days...

Ten Things You Must Do

Among them: get out of debt, get out of stocks, get into cash.

I've recently heard some people wondering out loud what good does owning gold do... especially in a contracting economy.

Here is my take on it

At the most basic level, where we worry about survival needs (water, food, shelter) money is useful only if there is excess production of any of those things. In such an environment, it facilitates the distribution of the excess (as opposed to just storing it). Without excess production, there is no point to money.

Gold has proven itself as the best form of money we can come up with. In a contracting economy, there may or may not be excess production, but as long as there is, gold has demonstrated its ability to maintain its purchasing power.

Owning gold should not be your first priority. It should be what you do with excess wealth left over after your primary needs are secured.

Gold is up 7% year over year and 150% over the last 5 years. It is doing its job.


Don't count on metals. I know, I know, we're going to hyperinflate and gold is going to the moon. I have one question: Can you eat it, drink it, run your car on it, sleep under it, or screw it? No? That's a problem. A "sudden stop" is not a hyperinflationary event - it has good odds of being quite the opposite. God help you if you put your eggs in that basket and are wrong.

I think his advice against gold is reasonable. If some discontinuity occurs in the economy, a "sudden stop", then you won't have access to the gold or the ability to liquidate it.

Hello Odysseus,

Nothing is more 'future-oriented' than seeds, water, and the Elements NPKS. IMO, Nature's photosynthesis process is timeless, and if a Liebscher's Optima can be achieved, then a 20:1 or better agro-ERoEI is possible. Food surplus->job specialization->civilization.

A farmer/gardener will not be interested in trading food for gold or a big screen TV, but will be interested in trading food for O-NPK or I-NPK because it offers a chance to continue to move into the future.

I have many postings in the archives on various personal and national strategies for leveraging above a Liebig Minimum: Federal Reserve Banks of I-NPK, investors getting with farmers to stockpile a multi-year supply inside the farmgate, composting, and so on. Recall my Ft. Knox scenario: gold bricks stacked outside in protective bunker formation to protect the seeds and I-NPK inside.

IMO, I-NPK may be the Last Bubble, but we could use strategic control of [S]ulfur to help create a giant O-NPK bubble thru full-on recycling. This S-method would help make things less worse than they might be; a move towards Optimal Overshoot Decline:


Have you hugged your bag of NPKS today? We are evolved to do the nightly darkness, but not starvation.

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

I think what everyone misses is that gold is not to be compared to things that have intrinsic value such as food, fertilizer, seeds, fuel, etc. It is to be compared to paper assets. So by all means, pay off your debt, buy fertilizer, seeds, non-perishable food, start a garden, do composting, etc. After all this if you still have money left, buy some gold and get out of paper assets.

Bob, I've enjoyed your posts for years and fully agree with you. My flock of a dozen chickens is keeping me flush on the O-NPK and yes I have hugged many a bag of I-NPK. Garden is full and I'm having trouble keeping up with harvesting now. Currently I'm learning more on fungi foraging from local experts.

I still worry about your location though... not a nice place w/o A/C or H2O and an excess of humans...

Chris Hicks in Boulder, CO
-Hopefully smarter than yeast, but hell, drowning in beer would be a nice way to go.

A pretty ominous article. I tend to discount fevered "end times" talk and store food & ammo calls. What I found myself agreeing with though is how finances look like an even more precarious house-o-cards since the bail out smoke & mirrors.

Does anyone have data about people "fleeing treasury bonds"? Does data back up his assertions about the huge public float possibly coming to an end?

I guess now might be a good time to get my last stock assets into cash?

Worse than the Great Depression?

For guidance on where we are in this long-drawn saga, I look to Berkeley's Barry Eichengreen, author of the Great Depression classic Golden Fetters – which avoids the error of viewing the 1930s through a US prism.

He has crunched the latest data with Trinity College Dublin's Kevin O'Rourke for VoxEU, concluding that the global rupture over the last nine months has been more violent than in the early slump. This is logical. Global debt leverage is much greater this time.

I agree completely,but do not fail to remember that we may need to get out of cash pdq someday not too far off.There is a very real possibility that we may suffer a runaway inflation.

I am neither an economist nor a historian,but I read both,and our current situation appears to be almost custom designed to gaurantee this result.

I am betting personally that inflation wipes out average investment returns over the next few years by buying anything I can store easily that I expect to need later.

Stoneleigh does predict inflation in the end. But it could be a long time before that's a problem. Japan has struggled with deflation for almost 20 years now, and the Great Depression lasted ten.

I think "things" of all sorts will get cheaper, as people sell their all their stuff for whatever they can get. The eBay economy, Kunstler called it. (MSNBC has a series about a town in the midwest, that has been especially hard-hit because their only major industry was RVs. Garage sales are booming, as people are forced to sell their possessions to raise cash, and as people who once wouldn't have dreamed of buying second hand now have to.)

I don't have much space, and I am not expecting to stay in this area forever (perhaps not even much longer). So accumulating more stuff doesn't make sense for me.


My wife is from that county and going back there is like a bad 80's sci-fi movie of the week. You go into a McD's and are used to seeing teenagers and it's all 45 year old men supporting their families because it's the only game in town. You read about it in the MSM, but seeing it really hits home. Every street has homes with card tables set up with yard sale signs in it. I'm talking like 2 out of every 3 houses. And it's not like only Saturdays - it's everyday.

You can feel the despair in the air.

Alot of people have left for greener pastures. I just don't see a way out for them. If that's what the future looks like, I know we talk a good game, but jesus it's going to be hard.

Luckily her grandpa still has some land he farmed. 2 Cousins and their families have already put trailers by the house.

Note that the years are clicking by pretty quickly -- we're already almost one full year into the deflationary phase. From my perspective, the crash has been slower than expected, probably due to massive new debt from the Feds, but in turn I expect the trough to be lower.

Garage sales have people selling to raise money and others buying to save money -- makes perfect sense...and it's an invisible tax-free economy, so the state suffers to boot.

As long as interest rates stay low we can exist fairly well in this fairly liquid slump, oscillating on a long, slow, slide, IMHO. If they go up, we'll be in a world of hurt with new rate resets forcing foreclosures, coupled with inability to get loans at "fair" valuations, and higher fractions of income going to interest as well. Seems like having a mortgage at all would be bad, but new renters may help cover low, fixed-rate mortgages on modest houses for a while, as denizens of McMansions move into suburbia. Rentals up to $2000 per month seem to be doing well in my neck of the woods.

"There is a very real possibility that we may suffer a runaway inflation."
I don't see how this can happen unless "the people" get their hands on that money that's being "printed". But that would be something like bailing out the people facing mortgage foreclosure rather than bailing out the bank doing the foreclosing. Given destruction of unions since Regan and the fairly complete adoption of right-wing assumptions about economics, how can that happen?


I am not an economist,but I have taken the INTRODUCTORY level courses,and I do read a lot of history,so here goes as best I can:

When governments spend too much,and make up the difference by borrowing,at some future time either spending must be curtailed while holding taxes steady,or taxes must be raised while holding spending steady,in order to pay off the debt.

I expect you do not need me to go into much detail about why either option is unpopular as hell.

Nevertheless in "normal" times some combination of these two options is usually employed to keep the budget deficit(the difference between what is collected in taxes,and what is spent,which is generally larger) from becoming too large.The budget in the US and most other similar countries is virtually always in deficit,although there are bookkeeping tricks that sometimes work well enough to allow the pols to claim the budget is in surplus.The usual one is simply to leave a huge chunk of spending "off the books."

When "normal"times turn bad,the pressure for additional spending becomes so high that it cannot always be resisted.So many people will be looking for a business bailout, or dependent upon a company in trouble for a thier job,or work for a company dependent upon another company in trouble,and so forth,that the development of this pressure should be easy to understand.

Then we must add on the people directly dependent upon the govt for social security checks,etc,that are in line in both good times and bad.

Remember that tax collections are waaay dooown because the economy is in the pits,so the deficit is already much larger than usual.

If the spending passes a certain "tipping point",the people who buy up the government debt-such as the Chinese and the oil shieks-start to worry about the credit worthiness of Uncle Sam,and back off.

I'm not the sort who keeps lists of links handy,but you can can google the financial news and find out pdq that lots of people holding Sam's notes are already seriously worried.These guys are not just bloggers like me,they are executives responsible for the safekeeping of tens and hundreds of billions of dollars.Some of them might literally lose thier heads if they lose the money and can't get the hell out of Dodge fast enough.

These folks have been up until now the friendly bankers who let us have all we wanted at ridiculously low rates.They are starting to ask for higher rates,and if they get really scared,they will cut us off.

Then we go to the friendly finance place near the bank where the rates are higher but the questions are fewer.

Or maybe we just print the money.We're apparently getting seriously into the printing stage now.

NOW we get to the really big IFS.

If the economy does turn around,and the feds do manage to vacuum up all that funny money,things will hopefully be more or less ok.We go back to paying more taxes and spending less and things at least approach "normal".

IF the economy does not turn around,or IF the powers that be sailing the monetary ship miscalculate,the supply of funny money can become unmanageable.

The government may become desperate to maintain SHORT TERM STABILITY at the risk of serious inflation a few months down the road because it percieves that it has no other choice, and simply print even more money,and send out "stimulus checks".

This soon results in a viscious positive feed back of even less creditworthiness ,compounded by anyone and every one with cash rushing out to spend(read get rid of) it before it becomes worth even less.It does not matter that Joe Sixpack has very little of this cash,the doctors and the lawyers and the rich are always with us, and they will have it,and they will be desperate to get rid of it.

When the crowds start busting windows,the presses will roll and every body will get another stimulus check.Can you say PANIC?

The whole process winds up like the giant snowball getting bigger and bigger rolling down the hill and fixing to run over Olive Oil on the cartoons we used to watch when I was a kid.Only in this case Popeye may not have enough spinach of courage to stop the presses-and the snowball.

You can read all about the snowballs that have run over Zimbabwe and Argentina recently,and Germany after WWI to name a few.

Or try this explaination,it might "click" more easily.

Imagine the you and 499 other people live in a little community totally isolated from the rest of the world.

Your community uses gold for money,and there are say twenty five thousand little gold coins circulating in the community.Fifty per person,and every body has at least a few.

So lets say a bushel of wheat costs one coin,and so does a wagon load of firewood and so does one fat goose,etc.

Now let us suppose that I, a less than upright character,also live in your town,and I figure out an easy way to counterfeit the coins.Easier than whatever I have been doing to pay for my firewood,wheat and goose.

So I pass an an unearned fake coin every few days,and work less,but not enough less to attract attention.Maybe if you are my good buddy I share with you.

So I work less but I eat better,since I can "afford" more of whatever I want.I eat goose twice a month instead of once a month,and keep my house warmer,because I can "afford" more firewood.

So geese and firewood supplies are just a little tight,and whatever I used to sell,say maybe potatos are a little tight too,since I don't work as hard any more in my potato patch.

Now pretty soon somebody who wants a goose has to pay a little more,and somebody who wants fire wood pays more,and ditto potatos.This is not a big deal at first,but as prices start to rise I can pay easily while you cut back-unless you are my sharing buddy of course.

Meanwhile the number of coins in circulation is growing every time I pass a fake.Pretty soon the guy selling me the extra goose every month decides that since he has plenty of coins,he will quit growing his own potatos and buy them instead.They may be a tad expensive,but hey,what the hell,he's selling geese,times are good,there's plenty of coins in his pocket.He buys more firewood too.Besides-the price of goose is going up too ,right?

Now by the time you and me old buddy between us have passed a thousand fakes,we will have probably succeeded in raising prices by a little more than about four percent across the board because there are now 4 percent more coins chasing somewhat fewer goods.If we think we can get away with it,we will merrily destroy the purchasing power of a gold coin by flooding the economy with our fakes.

Now read printed money for fakes,and substitute the names of whichever groups on the government financed bandwagon you like the least for sharing buddies-they are going to be benefiting at your expense as long as you are payiny taxes and buying goods.

This whole process could go like a runaway train,or if kept partly under control it might only result in prices doubling every 5 or 10 years ,as has happened in this country a couple of times since I've been wearing long pants.If you are old enough to remember Reagen,you may also remember that"stagflation"-inflation at a time when business was lousy-had a lot to do with his election.

This is off the top of my head,and I apologize in advance for the lack of polish.I can usually reccomend books but in this case I cannot,mine are long gone text books.Rubin's new book Your World Is About To get A whole Lot Smaller does have a very good short discussion of inflation.

He left one thing off the list -
Sell all gas powered cars, and invest in other forms of transportation.

AT&T ex-CEO to head the "new" GM........
If GM follows the logic of what AT&T did,
then prices will go up, and service will go down.
The company will split, then reunite later to take more money from customers.
The taxpayers will never get the billions of dollars back.

AT&T ex-CEO to head the "new" GM........

Great, now I'll receive calls every week asking me to switch vehicles, or I'll open up my garage door to discover I've been "slammed".

(I always thought phone service in Canada was kinda crappy, that is, until I had to deal with those idiots at Bell Atlantic.)


1. Don't get out of debt. Others aren't and so should you not for in the end all debts will be uncollectable.

2. Don't hoard cash. Hoard that which is eatable. Cash will be worthless.

3. Buy buy buy..all things needed to survive with.

4. Sell all your useless junk that will turn to trash soon enough.

5. Raise as many children as you can. You will need lots of labor and try to have some fun doing it.

6. Don't listen to the pundits. They have their own agendas.

7. Stop all insurance. It will be useless soon enough.

8. Do the opposite of what your gobbermint espouses.

9. Buy a donkey. A jack to breed to the horse mares you just brought to create mules. You won't need hay or pastures once we go 'open range'. Mules are the best draft animals since the beginning of time.
You just can't fool a mule. They KNOW the score but will work hard anyway.

10 And never never stop planting peas and beans.

11. Quit smoking. Moonshine is better.

12. Try to be cool. Like the hippies. Make it through, work it out.
The world will reward those who reward it. Get some love beads.
Whatever. Good ole Bob Dylan songs have messages. Seek them out.

Airdale-what did I leave out? Oh learn to play a harmonica. You won't regret it. Not the 'blow' shit...try some bending and blues. There you go! Now go outside and build a fire. Roast some good meat and howl at the moon til it goes down. Then go in and get laid.

1. Don't get out of debt. Others aren't and so should you not for in the end all debts will be uncollectable.

This depends if you own your own home or are close to it then getting out of debt is wise. If you don't have the financial capability to own then dunno.

My point is I think this is something that you have to think about on a case by case basis. Property laws tend to be the last to go even if it boils down to self enforcement. Basically you need to solve the shelter problem for yourself and shelter depends on your financial situation. If you don't own a shelter then hoarding cash until you can buy something is probably a good bet.

Depending on the local laws running up debt when you own property is probably not a good idea.

There are good reasons why voting was originally restricted to land owners simply because they by default had to be prudent thinkers.

Airdale from reading your post I suspect you own your own farm free and clear so I think your letting your own personal wealth cloud your view.

A better way to put this is: "Own what you own."


I paid mine off. But then I owe a bit on the Harley.

Would be kinda hard to repossess a HD. Specially in a barn. And having to trespass to do it.
But otherwise I am near to debt free. A bit on a credit card.

But its like the mortgage bailouts and then the squatters moving back in. Howse about a owner moving out, then coming back as a squatter?
Grow a beard, get some new ID,whatever.


You'd have to worry about other squatters also moving in (and perhaps forcing you out).

Stoneleigh pointed out that you need to own not just the property, but enough cash to pay the taxes on the property. Which might climb steeply as local governments try desperately to stay solvent.

I could foresee a future where the government ends up confiscating property in order to turn it into poor farms or something of that ilk.

OTOH, if it all falls apart to the point that property laws no longer matter...why bother going into debt to own anything? You'll be able to help yourself, just as much as the person who once paid for it.

But then your competing with many other squatters :)

My only point is property ownership is the last law of the land if you will if you have the deeded right to a property you will defend it yourself after the system fails.

This is my only argument to Airdales post and it goes back to his suggestion you rack up debt. Only if you can protect your free and clear property rights from the debt does that make sense otherwise right now the single most valuable thing is free and clear property ownership.

Over my dead body.

Quick Reminder.. (I posted this late last night, really hope we get some eyes onto it)

If the word of Scientists Matter,
and If you agree that Congress should task the National Academy of Sciences (NAS) with doing a comprehensive analysis of the likelihood and ramifications of hitting the decline in worldwide oil production, (AKA.. Peak Oil) -please go to this link and sign the petition.

The EB post from yesterday..

or go right to the petition ..

Even if you think there's no hope that it'll ever get through, or will do any good.. let signing this stand in for one of the posts you would have labored on here today, which would probably do just about the same amount of good AND unintended harm as signing a decent and well-conceived petition.


Unless the petition is stapled to a substantial campaign contribution check, I'm afraid the gang at EB has a serious misunderstanding about how our (corrupt) system of government works.

The facts are readily available to those who wish to understand them. To think that a different logo on the cover page is going to change the opinions of vested denialist represents a gross miscarriage of understanding.

I'll sign it anyway, mostly for the same reason I vote.

Why bother?

By the time they agree on who is on the committee, gather them together, have a bunch of debates about things that have already been pretty much figured out, and produce a report that says nothing new to those of us who have been paying attention, it will likely be too late.

Well, I bothered because I might be wrong about the timing.

I bothered because while I know all about Peak Oil and the consequences, most people can't determine right from what they are told on TV. Perhaps a report from the National Academy of Sciences would have the authority to change people's minds.


ps. RE toplink on oil platform infosec weaknesses. No, I haven't been breaking into offshore oil platforms and don't intend to start (at least not without a contract) :)

Thanks for the 'What the hell' vote, eric.

Why Bother? Cuz you never know..

Perhaps a report from the National Academy of Sciences would have the authority to change people's minds.

Why would it? Most people don't even know what the National Academy is, and typically appeals to expert authorities these days are immediately obfuscated by people who oppose their message for political reasons. Representatives of corporate interests would dig up their own talking head or "think tank" or whatever to take the opposite stance while trying to sound equally authoritative.

Result: even the type of well-meaning person who would readily become part of the solution doesn't know what to believe.

Thanks, Ashenlight,

These are important questions.

1) "Why would it?"

The NAS could bring to light some of the excellent work featured here on TOD. The work of Joules Bourne, Jeffrey Brown, Samuel Foucher, Tony Erickson, Gail, Nate and many others.

This work is not mainstream and is not known to most people.

The members of the Academies themselves often don't know about TOD. In fact, many people (and I have met them) who work for the consulting firms - (such as the one Dave Cohen mentions as being hired by Energy Secretary Chu) - are unfamiliar with the groundbreaking work posted on TOD.

People lack information. Some of these people are scientists themselves. If nothing else - (and I think there is much else) - the scientists who are members of the Academies will learn a lot.

This means the information people desperately need will be more available.

2) "Most people don't even know what the National Academy is..."

Ah, but you can let them know, AshenLight.

They will be thrilled to learn that the Academies were founded at the beginning of the "Age of Oil" and that they are designed to be objective. They may not come through for us - but if anyone can do so, there are the most likely candidates.

3) "even the type of well-meaning person who would readily become part of the solution doesn't know what to believe."

That's the point. That's why we're here and that's the "why" of the petition.

It's not "belief" - it's to encourage the best aspects of thinking...thinking for oneself, examining the evidence, talking to others who may know more and have a different perspective and insight.

4) Here are my sincere questions to you:

1. Why are you here at TOD?

2. Being here, how do you think we can best address the catastrophe that is (it seems) already beginning?

3. What do you think we should do?

4. How do you think we should do it?

5. Who should do it? When? (and with what resources, etc.)

1. Why are you here at TOD?

2. Being here, how do you think we can best address the catastrophe that is (it seems) already beginning?

3. What do you think we should do?

4. How do you think we should do it?

5. Who should do it? When? (and with what resources, etc.)

A #1: I'm here at TOD mostly for the thought provoking dialog. This first question is worthy of a major post all by itself. For the moment, I don't want to get bogged down in Q #1 because Question #2 seems more interesting.

A #2: As Tonto said to the Lone Ranger, "What do you mean by "we" Kimosabi?" (punch line to a joke where the dynamic duo are surrounded by large number of Indians and Lone Ranger says, Sorry Tonto, looks like we're done for it)

There are a lot of different "We's" here at TOD. A lot of different factions. Depending on who "We" is, the answers can be all over the map: We as lone readers of the TOD site? We as active commentators on the TOD site?, We as citizens of a specific town, tribe, state, country or planet? We as proponents of a given ideology? Etc.

A #3: Does "We" include me? Oh oh. That changes things. It's far easier to talk about what "They" should do to solve our problem.

A #4: How? There is something to be said about having a charismatic leader who can bring all the factions together to serve a common cause. President Obama is an example of a charismatic leader. He's got cool, calm, an ability to rally many factions around him. Unfortunately he also has his head stuck up the "money can solve everything" trap hole. I don't know if he can be grabbed by the toes and pulled out of that delusion in time to perhaps save us. So who are the other nominees for charismatic leader of the TOD cause? Anyone?

I really hope that you're not waiting for some 'charismatic leader' to define WE for you.

So who are the other nominees for charismatic leader of the TOD cause?

Isn't it obvious? Me!

Oh, wait... I read that as chaosmatic...

Sorry ccpo, GW Bush will probably go down in history as the most chaos-matic leader to date. Unfortunately, new candidates for the title seem to emerge every other day.


1. I am here to measure the progress of the future. Wide ranging
news from many areas gives me a 'heads up' in order to make valuable preparations.

2. How best to address the catastrophe?
By individual and family preparations. I refuse to trust any governmental entities. They got us here or did nothing to prevent it.
They make the laws and should have shown leadership. I don't see it.
Obama makes plenty of promises then as time goes by new ones overlay the old ones and the old ones never get addressed. They seem to just disappear.Like 'transparency'.
All his campaign promises? Zero action. He just hop,skips and jumps to something else. The consummate politician,,,a fast moving target with the wind at his back and plenty of MSM support but does nothing. Now off visiting Muslim Countries. I see zero value in that.

3.What should "WE" do? Meaning TOD? Spread the news, speak on becoming prepared, find an archival method so the valuable information placed here does not disappear but can be easily retrieved by others, oh yeah like those scientists you state who have little info to go on.

And help the ordinary citizen to understand and withstand what is coming. We know oil is dying. We know what may or may not work. Shed the dross. Concentrate on what will save us. Ag, land, stopping the destruction of nature,crisis of good water,crisis of depletions,the list is large.......oil being just one.

4. How to do it? Its already being done but needs some fine tuning. Better archival, topics that make sense, outreaching, better censoring of comments since the 'appropiate flag' is rather useless, and asking the audience for their views on this question.

5. Who should do it? The membership with leadership from the owners and editors. Time is awasting. From this point on its too valuable to waste. It may be too late already, I suspect it is, so now its just coping skills. Blue sky is receding rapidly.

Addition: My views are that individual land ownership is crucial and how to utilize that land privately. I guess communal ownership might work but we in this country were never too much into that venue. I prefer to work with my neighbors but demand my own privacy on my own land to survive or not as my abilities dictate. Government needs to get out of the way. Huge interstates are being rendered useless and fading anyway. Taxes should be decreased as government is downsized as it should be. Health issues should decrease as we turn to a more healthful style of life. No revenues should be spent propping up dead and dying institutions like finanacial, automotive,etc.

The power is with the individual and the family. The family farm needs to return to front and center. Bartering and trading as well as what was once known as 'Granges' or local close-in small communities that can solve local problems with crime ,etc. The power of the sheriff and local governing bodies to solve their own problems.
Town hall meetings need to return.No one should have a death lock on others via local power.

Like I read and hear...only 2 percent of the population control most everything....THAT HAS TO CHANGE. Its dying. Let it die.

Might one even say this? Power TO The People. or...
We the people....and a government For, Of and By the people. Not a small bunch of very wealthy ones running the show who take us down the drain or circling it for now. Its NOT working.

I forsee great desolation invading the land. The internet will not survive. Computing will slowly die as replacement parts dry up and the power disappears. Individuals and families will have to survive by working the land. We have thousands of years of history of doing just that. Most of the land is useless or has been rendered so. Whats left has to be carefully husbanded and cared for.

And we will NEVER come back to what was..the means of that by exploiting resources is over for the resources are now depleted. Our real resources is just nature in its simplest form.Forests,water,open lands,rain, diversity,etc. If its not past the point of no return and that IMO is debatable.

Summation: Its all going to be about individual actions now.

Airdale-I could be wrong. I have been wrong before. I am now coming closer to the end of my life on this earth and wish to use it wisely and make it count.

I think I have to take you up on one line, there.

"Its all going to be about individual actions now."

That sounds like a Darwinian line.

There is a TON that individuals can and must do.. but we are still a social animal, and will be until there are less than two of us left. We have great opportunities to pool our efforts, and not just at the family level. Look at this site. This is a group effort, even as disconnected and unfamiliar as we all are with each other.

Look at the volunteer fire department..

Look at a small business in your county..

Look at a non-profit that is fighting Mountaintop removal against some HUGE vested interests..

Look at the Scientists who are trying to work between disciplines to get the word out on Climate Change, or Diabetes, or Shoreline Waterfowl habitats..

We will NOT succeed without joint efforts, big and small. A lot of our modern world has been devised to keep us separate. 'Quality of life' has often been paired with having walls and yards and lots of space between all of us.. but look at the loneliness it has wrought. I like my solitude, but not perpetually.

Not trying to harsh you, Airdale.. but that Summary of yours, I had to speak otherwise..

Bob Fiske

Thanks for sharing your opinion.

I would do more in a community sense but we are rather closed in here.

I do show and speak to friends and pastors/preachers. Those who stand in front of many people. I do speak to farmers but as stated in another comment/post....I am getting the glazed eyes look.

Yet some are starting to say "hey I heard it from you way back and now its happening"...just a few. A very few but I did reach some.

I am not in a large city nor a suburb. I live here with my ancestors graves and some kin folk and friends. Most do NOT want to hear it.

I speak to a buddy who owns a car repair facility. I speak to a friend who had a large manufacturing plant. Both are gone due to economics now.

But then I look mostly to myself and preserving MY life. That is where I can and do make a big difference.

Airdale-soon enough garden harvesting will start. This is the most crucial time for me. Its my lifeline if things go awry. Like another massive ice storm or hurricane or drought or earthquake from the New Madrid fault line...

A lot of our modern world has been devised to keep us separate.

So true.
NPR was interviewing author Douglas Rushkoff today about his book, Life Incorporated and that is one of his premises, namely, that the nuclear family was invented to keep us divided and conquered.

I second the motion. I signed up yesterday, then did a Peakoil Shoutout! I encourage people to keep emailing Tiger Woods' website plus emailing Google for the clickable "I'm feeling Unlucky" button,too. :)

Your comment cracked me up.

Who knew you could be so concise?!
People should just check out the Petition site to see the comments by our favorite PO Luminaries. Some great elevator speeches in there. http://www.thepetitionsite.com/1/Understanding-Peak-Oil

Tom Whipple was even less chatty than you, Bob!

Bob Fiske

'There's a lot to be said about brevity..'

I just saw the comment of one of the people I sent a plea to.. he doesn't even know me that well..

The numbers are rising but still small.. join in, be a real underdog! Embrace your inner Policy Geek!


I get the impression, correct or false, from big pronouncements regarding natural gas in North America, that the US could run transport on NG and not import oil for twenty years or more. Is that a realistic assessment? Would that require Pickens plan of wind to replace natural gas used at power plants, or is there so much NG we can just make the switch. And if we can, then why aren't we?

Cs -- I may have touched upon this point with you before...not sure. I would guess we have enough proven NG available with current technology to run a very great percentage of the economy (including transport) for many decades. The big "IF" of course is the price of NG at which this could happen. Just a very WAG but let's say $15/mcf…maybe a little higher. And that price must stay stable (except for a little inflation, of course) for the next 15 or 20 years at least. Is that going to happen? I wouldn't bet lunch on it. Look what has happened in the last 12 months: $6.50 goes to $13 and then goes to $3.50. Even a less volatile future will keep NG production way below the levels we’re speculating about IMO. But we have greatly increased the amount of proven INPLACE NG reserves thanks to the shale gas plays. How much we'll recover over time will depend upon NG pricing as it changes with the supply/demand curve.

Of course this same logic applies to the coal discussion above as well, except I assume the turn-around time on a mine decision is much longer than a nat'l gas well. Coal and NG may both be unavailable at current costs in only 5 years, and almost certainly by 15, but the 100-years of coal may well happen at 10x the current price. Our economy would look different, but I think would still be functional compared to doing without energy at that cost point.

I think what we need is some view of what the world would look like with energy at various costs -- say at 50, 100, 200, and 500 dollars per barrel (and similar multiple for other fuels). At some point shifts to "expensive" sources like nukes and solar will make sense, but societal change will have to happen as well.

Inversely, what is the dollar-per-kwh for human labor, horse, oxen, etc? If energy becomes expensive enough, we'll end up going back 100, then 200, then 500 years on the industrialization timeline to lower forms of energy. Standards of living will drop, but I imagine it will make fiscal sense to suck out every drop of oil and cubic foot of gas that can be recovered with EROEI of greater than one, and probably some at less than unity if the utility of liquid fuel is greater than that of electricity (say, for military jets).

My fear is that Easter Island and Haiti will look good by comparison once 7B people dig their way down to pre-industrial existence.

I think a better metric would be acre per kwh of work. It took about a third of a farmers land to raise the energy to feed his draft animals pre oil. Today it would only take about 1/10 of a farmers land to produce the oil seed crops to produce home made biodiesel fuel to burn in existing tractors.
I don't think there is any chance we are going back to draft animals in any big way in the future. You just can't stuff the labor saving ICE technology back in a box.
Which do you think farmers will do: Cut trees, cut to length, split, haul, stack haul into the house, feed the furnace all day and night, clean out the ashes, clean the chimney, Or grow oil seeds crops and produce homemade biodiesel fuel to burn in a fuel oil furnace where you just fill the tank once a week or month and the furnace runs nice and clean and automatically?


My work indicates that as oil depletes other energy resources will tend to cost the same as oil minus a energy quality tax. For the end user the price differences will be negligible. For example a NG economy would require a significant expansion of the pipeline network and storage and tons of other infrastructure. This has to be paid for.

And of course we have burned up the cheap NG in North America.

And as far as inplace NG reserves in the shale plays I question how real these are.
Not that they are not significant but how significant and can we exploit them fast enough to not only cover conventional declines but expand to support transportation. I don't think we have exploited them long enough to prove the reserve claims. My hunch is that in reality the real recovered amounts will either be a lot lower then expected or occur at a lot lower overall production rate. We will see but I just think there is a real physical limit to how high a decline rate can be for a viable energy resource. This gets into EROEI but its more than that. Think about if you had farmland that dropped in yield 50% every year and had to move on to new land ( slash and burn agriculture) we know from this example that fast decline situations don't work for long.

And of course selling NG as a more expensive transportation fuel would cause electric price to increase so again no free lunch.

Can we use the BTU's in NG to offset the declining availability of BTU's from oil
well yes.

Does it make any difference at the financial level ?


I agree with you on the inplace reserve numbers memmel. They could be half what they throw around or maybe 3X as big. In one sense it doesn't really matter. As you point out resource utilization will be price driven. When shale gas wells can again deliver a 25% rate of return we'll be drilling like crazy and we'll have many TCF to produce. And then when drilling/completion costs go through the roof again or demand falls off we'll loose most of those TCF's of "proven reserves". Short of the political system suddenly developing a shocking amount of foresight and will it's just going to be one peak followed by another slump etc etc. With no long term vision (and the intellegenc/guts to impliment it) there can be no long term solution IMO.

Bigger than this is taking a civilization from a cheap abundant resource just to and expensive resource much less the issue of how abundant it is.

If you look at the last few decades you can see the even though oil was nominally cheap we had real declines in net energy and growth was tepid and driven by larger debt.

Real BAU i.e simply following the trend indicated as energy supplies become more constrained and more expensive that the overall economy will continue to contract.

The thesis that we can somehow substitute inferior alternatives and we will be ok is not even supported by our own economic history much less and reasonable logic.

If the UNG reserves are questionable then where does that put most of the alternative energy schemes ?

Another way to look at it is if the tar sands don't work then nothing does.

You can argue tell your blue in the face but if we can't run our economy off the tar sands then every other opportunity is inferior. Unconventional oil plays are the least expensive solution. It does not take a genius to figure this out.
Its blatantly obvious its just people don't want to face it.

Therefore we are toast.

And only after we face the fact that we are screwed do we stand a chance of making lemons out of lemonade if you will. As long as we dance around the obvious we can't make the really tough decisions we need to make.

How do you protect large solar fields from sand and hail storms?

Good question.

The poor people will be handcuffed in place across the panels before the storm hits./rant off

Here is another issue ..

Anyways, they have to wash and clean those panels every now and then - in order to keep efficiency up to the mark

If you install your PV array where you will have to deal with snow, you have a choice. It is your choice to deal with it manually, as the photo shows, or you can install an adjustable mount that can adjust to a high enough angle so that the modules will not hold snow (see here: http://www.unirac.com/mounting-solutions/pv-pole-tops.php?solution=pole-...).
It's your choice.

As for washing/cleaning, they usually don't require any (unless the modules are next to a dirt road, or other dusty area, and you don't get rain very often). The usual rain and snow fall will keep them pretty clean.

I've had my off-grid PV system for 6 years now, and I have never washed it once. The efficiency is still "up to the mark", after accounting for annual output degradation. I did have to remove some paint spatter once! :(

And yes, I remove snow from my array manually. Have you seen the price of those Pole mounts?!

And yes, I remove snow from my array manually. Have you seen the price of those Pole mounts?!

If you have a single axis tracker, you set to a high angle in winter (because the sun is low in the sky), and a lower angle in summer. Perhaps you only need two semi fixed angles, switch over around the time of the equinox.

I see the comments include references to both HAARP and scalar technologies. MIRAGE seems to be the newest iteration - at least new to me.

An easy answer would be to use a tracking system with a "safe" storage position. Tracking would also increase the collected energy per unit of aperture, which would mitigate some of the increased cost, while producing a more nearly constant output thru the daily cycle. The new PV system using thin film coated tubes would tend to shed snow and are said to be strong enough to withstand good sized hail. The same might be true for the evacuated tube thermal collectors as well...

E. Swanson

PV modules are faced with tempered glass and tested for hailstone impact resistance. Sand isn't much of an issue as long as you can clean 'em off, which large solar fields have a way to do. CSP systems also use various types of tempered materials (or even unbreakable thin reflective films), and when one breaks, it's simply replaced--a fairly cheap thing to do for a CSP system.

Quite interesting study comparison of full lifecycle energy and emissions of various transportation modes. Heavy aircraft come out surprisingly well. Rail measures suffer due to energy requirements for infrastructure, etc. Interesting to see if it holds up to review. My favorite mode, the human/electric hybrid bicycle was not featured :*(

At Green Car Congress

AlanfromBigEasy, are you out there?

There's discussion of this in yesterday's DrumBeat.

Russian statistics for Jan-Apr 2009 was released.

Category 1-4 2009 / 1-4 2008 Apr 2009 / Apr 2008
Production -17.0% -24.3%
Gazprom Production -20.8% -28.8%
Ind Production +2.7% -1.1%
Consumption -6.2%  
Export -53.3% -34.4%
Export to Far Abroad -56.8% -40.9%
Export to Near Abroad -38.9% -1.2%
Export/Production down from 31.7% to 17.8% down from 26.8% to 23.3%
Drilling -21.8%
Investment +25.9%
Production -0.5% +1.9%
Export -0.4% +1.8%
Export to Far Abroad +0.9%  
Export to Near Abroad -7.3%  
Export/Production 47.6%  
Refining -1.7% +0.8%
Benzene +1.3% -0.8%
Diesel -2.5% -1.7%
Heating Oil -2.2% +4.4%
Production -17.3% -12.9%
Consumption -19.1%  
Storage +29.3%
Export -7.4%
Import -23.2%

The numbers in itself are quite scary, it is kind a hard to draw any real conclusions with this recession going on.

Re: the cost to the US of The Cap Charade.

Since this is a political question take take the worst case estimate and double it. That should put you in the ball park. The odds of a government program coming in at projected costs is near zero. Just ask the geniuses from government who not long ago said the American stimulus bill would cap unemployment at about 8%. We are at 9.6% and still rising.

In my paper this morning:
was the fact that Obama's stimulus package has saved maybe 150,000 jobs, but the economy has lost over 1,600,000 jobs in the same time frame. See article at bottom of the page.
We're saved! Move along, everything is fine. Don't worry, Government has things under control.

WASHINGTON – Low-income families will receive hundreds of dollars a year to help pay higher energy bills if Congress enacts the first-ever limits on the gases blamed for global warming, according to a new analysis.

Of course they fail to mention that due to the impact of rising costs of all goods and services it will cost low income families thousands.

Which is one way to solve the consumption "problem" - kill off the poor.

Good place for this.

Maine House OK's energy bill

Eighty percent of Mainers depend on oil to heat their homes, compared to 8 percent nationally, according to government and independent studies prepared during the past year.
It authorizes $79 million in federal economic stimulus money spent over the next two years on energy conservation programs, principally weatherization and programs that reward consumers for buying energy-efficient appliances and renewable power systems.

(Posting links before Leanan gets there is like playing Oh Hell with my Sister.. try to keep my game up!)

That has always and will always continue to be man's solution to resource constraint problems.

I am perfectly willing to expose my ignorance today rather than be known as someone who bets on the wrong horse later.

I could figure this out for myself,but I might make a foolish mistake.

Just about how much oil can realistically be displaced by ng in the US? in the world?Enough to seriously slow down the loss of oil due to depletion?

I realize any replies will be only rough estimates,but I would rather have a rough estimates from a disinterested persons working in the field and posting here than glossy binders from CERA or the USGS,etc.

I was beginning to feel a little more optimistic about this question until I saw a piece yesterday that BOASTED about some really big gas field eventually producing the equivalent of 300,000 barrells per day.

As I understand it five or six such fields will be needed to make up for the loss of Mexican imports alone in the very near future.Furthermore I understand that while the recoverable gas is supposed to be very plentiful,getting it out requires more or less constant drilling,as compared to oil wells which produce for many years.

Mac -- I'll make a bold and unsupported statement that a great deal of the oil can be replaced by NG (see post just above). But let's forget the volumes of NG vs. oil in the discussion. A simple example: I can pump an old oil well using diesel made from oil. But I can also put a NG fired pumping unti on it also. But even when the NG is much cheaper I won't do it: the change out in pumps eats all the money savings and then some. Now expand that situation to all the other possibilites in our society. If we need to replace an oil fueled infrastructure anyway then the changeout might make sense. Same problem I see with expecting to change a large percentage of the car market with electric vehicles. The operational cost saving might be there but can the economy afford such a huge capital expendature so quickly. No IMO. Over time, maybe. But that requires having a long term confidence in the cost savings (as well as availability) from NG. Who rushed out to buy a Prius when gasoline hit $1.75 in Houston? Very few obvioulsly. And even if gasoline had stayed at $4.50/gal till today how many could afford to swap out cars even if they believed the price of fuel would stay high for years. Same damn hard nut to crack that we continue to chat about.


Well damn I wasted a post :)

As you know I hate wasting words.

memmel -- are you referring to a poor WROWI perhaps????

Most cars don't last more than 20-25 years, if gasoline goes to $10a gallon, those SUV's are going to be replaced even quicker, not much cost to the economy making EV's when we have idle auto plants and idle workers and excess steel capacity. Half of VMT are by cars less than 7 years old, so could halve gasoline use by 50% in that time.

I was thinking about Duncan's latest Olduvai update [Fig 5]:


If the US starts having BOE/C ramping downward fast, due to bad energy policies, ELM, and No full-on Peak Outreach due to the Iron Triangle: how fast is too fast for most 'Murkans to postPeak bear?

If they see lots of video of Europeans, Chinese, and others riding in their already built RR & TOD plus Kunstlerized urban areas [maybe SpiderWebRiding Networks, too?], while they can't even find a bus to take them over pot-holed roads with overflowing sewage: will the American Can-do Spirit come out, or will the 'Murkans just freak?

Will we quickly plow our 16,000 golf courses, or will we be like Zimbabwe where we wheelbarrow our dying and dead the long way around them? Will they still expect food stamps so they can eat Cheetos & Twinkies in front of TV sports and soap operas, or will they eagerly become Exosomatic American Heroes [see photos in links below]?

Would they postPeak prefer easy & convenient, labor-free handouts of Campbell's Cream of Cockroach soup? Or would they say 'Screw that', nicely hold hands with all their neighbors and sing Kumbahya, then rip out their front lawns to raise veggies & chickens?

going to work each day

work each day

What can be accomplished before we arrive at 3.5 BOE/C in 2030? When can we even begin to see enough pro-active change to even slightly dream about reversing the Olduvai trend? Do you think we can go all-cornucopian by 2015? 2020? 2025? IMO, all signs so far show the Thermo/Gene trend continuing to gain the upper hand.

Can we even get enough 'Murkans to become Americans again to even try; Is the Iron Triangle > Peak Outreach?

Toto: Remember that LA burned because some cops got off in the Rodney King court case. None of the "Burners" were actually involved in the dispute. This time they will be hungry ... draw your own conclusion.

toto anticipated this and has a phrase for that too, "machete moshpit" I believe.
For the life of me I can't remember what the "Peakoil Shoutout" was all about.
Is it just me or have toto's postings been more, "energetic" lately?

Hello Spaceman,

If my feeble memory serves: Years ago, I saw a video with Colin Campbell talking about Peakoil by referring to his half-empty beer glass as similar to the Hubbert Peak of crude production.

It occurred to me that if everyone who is Peak Aware would shout-out 'Peakoil' whenever their favorite yeasty beverage hits half-empty: it would spark curiosity among those who were NOT yet Peak Aware. This gives the 'shout-out person' a chance to explain the Hubbert Peak, how humans are like yeast, plus much more to a Newbie, and also give them websites names [TOD,EB,Dieoff,etc] or book titles [Powerdown by Heinberg, Overshoot by Catton, and so on].

I never had a chance to go to any ASPO gatherings, but I always requested for those attending to do the Peakoil Shoutout when they gathered in the bar/restaurant area after the daily meetings.

If you are in a public bar/pub consuming your favorite 'Nectar of the Gods' please practice this to help Peak Outreach.

Thanks for the reply toto.
Unfortunately when hoisting said yeasty beverage was part of my life, I, like most, never noticed when I passed the halfway mark. PO in a glass.
Much more thought provoking than the standard Orwellian " 'Ere's wishin' you the very best of health".

Well, there goes $70.... CLN09.NYM at 70.12 now.

$71.00 on API reports of a 6 million barrel draw.

Off topic - kind of.

Very crude so it you are easily offended mostly by language then DO NOT click on it.

But sometimes...

Can We Get This Guy On CNBC?


I want that boy on my softball team!

It looks like he prefers hardball.

The new International Petroleum Monthly is just out with the March numbers. No big surprises. World oil production is down 33,000 bp/d from February but that was after February production was revised up by 118,000 bp/d. OPEC, in March was down 61,000 bp/d while non-OPEC was up 27,000 bp/d.

Ron P.

The year over year changes in the IPM were revealing. For the 1st quarter, world crude production was down around 2.2 m/b/d from 08 and March was was even greater. Roughly 200 million barrels more were produced in the first quarter of 2008 than in the same quarter of 2009. At this rate, crude oil production looks like we are going backwards to 2004.

API report propels oil past $70:

According to a separate report released late Tuesday by the API, U.S. crude stockpiles fell nearly 6 million barrels in the week. Gasoline inventories rose 27,000 barrels, while distillates grew by 19,000 barrels, API said. Refinery use increased to 84.1% of capacity from 82.9%. The API statistics contributed to further price gains.


Physically impossible but lets see what the EIA says.

How so?

We're after Memorial Day - time for summer driving, gas is still cheap. This could be ramping to match growing demand; now we find out whether KSA has spare capacity or not. Oh heck, it'll probably take a while to unload the ships.

Is this the inflection point? I'd be watching EIA at 10:35am EST.


I always follow your posts with great intrest as you are not afraid to think out of the box & you state your convictions without fear of being proved wrong in the fullness of time. In that sense you remind me very much of Matt Simons someone who is always willing to question the “offical” data & use logic (& perhaps inside sources) to try uncover the true underlying picture.

“Physically impossible but lets see what the EIA says.” Please could you expand upon that. Why is it Physically impossible? Are you saying that the draw down is not from real barels, but paper barrels?

Remember that story about the guy who paid his workers in gold and silver coins, and is now in trouble with the IRS?

Subpoena seeks names -- and lots more -- of Web posters

On May 26 the Review-Journal published an article about an ongoing federal tax evasion trial. The primary defendant, Las Vegan Robert Kahre, stands accused of tax fraud for using the rather inventive argument that he could pay people in U.S. minted gold and silver coins based on their precious metal value but for tax purposes use their face value, which is many times less.

The story was posted on our Web site. When last I checked nearly 100 comments were appended to it, running the gamut from the lucid to the ludicrous.

This past week the newspaper was served with a grand jury subpoena from the U.S. attorney's office demanding that we turn over all records pertaining to those postings, including "full name, date of birth, physical address, gender, ZIP code, password prompts, security questions, telephone numbers and other identifiers ... the IP address," et (kitchen sink) cetera.

Hopefully they don't put you guys in Gitmo and start waterboarding you to give up our info.

I would expect them to start with Daniel Yergin and the CERA/IHS staff:

CERA official acknowledges “peak oil is here”
by EB Staff

Speaking at the Center for Strategic & International Studies (CSIS) in Washington DC on 8 June, CERA Global Oil Group Managing Director Jim Burkhard began and ended his talk by stating that “CERA acknowledges that peak oil is here, you heard it from a CERA person.”..
THIS IS REMARKABLE NEWS. Huge Kudos to ASPO and its members, and the work of Bart's EB & PCI, TOD, and all the other energy websites.

Now I wonder: how soon before the EIA & IEA & OPEC start joining the downslope club.

We need a lot more research on discovery & depletion rates to see if the downslope will be fast like Olduvai, or a slow Catabolic grind, and/or if we can shoot for something in between.


No, it isn't.

During his presentation, Mr. Burkhard explained that in acknowledging that peak oil is here, CERA’s interpretation is that US gasoline demand peaked in 2008 and is expected to decline in future years. He also stated that CERA maintains its position that the reasons for US liquid fuel demand having peaked are economic and geopolitical in their nature, rather than in any way driven by geologic factors.

Hello Leanan,

Thxs for your reply. Without starting a long thread flame: isn't CERA basically backing R-Squared's Peak Lite Scenario versus a true Geological Peak? That the global economy is now too exhausted [Nate's ERoEI Energy Cliff] to overcome depletion rates, therefore stranded resources?

Remember Don Sailorman? He said that it is very important to distinguish between 'demand' and 'actual quantity demanded':

Demand: what you would like to have. Think of a hungry, but very old cheetah, trying repeatedly to catch any gazelle, in hopes of eating it, but always failing. It quickly starves, and/or lions or hyenas tear it up.

Quantity Demanded: what you can actually buy, which determines supply. Think of a young cheetah that has the energy and vigor to 'actually' CATCH & KILL & EAT a gazelle.

My guess is that CERA is saying that they now believe the global sum of each country's economy is now mostly analogous to a bunch of old, postPeak cheetahs with some youngsters; we will chase gazelles like mad, but increasing fewer will eat.

isn't CERA basically backing R-Squared's Peak Lite Scenario versus a true Geological Peak?

No. From what it says at the link, they think US gasoline consumption has peaked. That is not peak oil. That is not even peak lite.

I would guess they are assuming that carbon taxes and/or transition to other fuel sources mean US gasoline consumption won't recover. But it might not even be that. They might mean "until the economy recovers."

What CERA is actually saying is "peak oil is NOT here."

Thxs for the reply. Let's hope we will get more clarification from CERA on what they really mean.

Mish has a post about Oakland pondering bankruptcy:


His comment:

By the way, expect to see a surge of cities considering bankruptcy. In addition expect to see municipalities in Florida and Alabama to do the same. The interesting thing to watch will be how far and how fast this spreads.

We can no longer afford the current, let alone the projected, level of local, state and federal spending, but government employees will tend to be the last ones to admit it. As Mish said, it will be interesting to see how this unfolds. It won't be pretty. California is now in a situation where a lot of other states will be soon.

Big emitters want free c&t CO2 permits post 2030. For starters there may not be much left to burn post 2030. Also notice the non-success of the European cap-and-trade scheme which has free permits and generous offsets. Free permits is like a gym where you take a nap instead of exercising or a weight loss club where you eat pizza. Generally we are talking CO2 cuts of 1-3% a year which should make it easy to conserve or switch to low carbon alternatives. Since Schwarzenegger understands 'no pain no gain' perhaps he should be put in charge of global c&t.

The Supremes are singing to the Obama beat, everybody now:
♫Do, re, mi, FA-Q!♫
If you are an investor that is.

I don't recall Julie Andrews using those lyrics.

At the Supreme Court, all pigs are equal in the eyes of the law. Except that some are more equal than others. Long live the contract (unless it suits us to do otherwise). Haste makes waste (.. for some, and great profits for others).

Hello TODers,

Potash Corp. of Saskatchewan (TSX:POT) may resort to selling fertilizer to China on the spot market instead of negotiating a long-term contract if the two sides can´t renew a three-year supply deal that expires soon, says president and CEO Bill Doyle.

"We are in the third and final year of our contract with the Chinese and at the Canpotex (fertilizer export company) board meeting in the fall we´ll decide whether or not we have another contract," Doyle told a minerals and materials conference Tuesday.

"We may go to spot and for moral reasons more than anything else, just to take some of the speculation out of the business."

Canadian fertilizer companies such as Potash Corp., Agrium Inc. of Calgary (TSX:AGU) and Mosaic Canada (NYSE:MOS) have long negotiated long-term deals through marketing company Canpotex Inc. with China, India and other buyers.
My guess is that the Potash Groups, Canpotex & Belaruskali, feel that they now get enough reasonably accurate info on weather, climate, energy, agriculture, fertilizer demand, and I-NPK supply chain dynamics, that they can now be aggressive 'price-makers'.

Recall my prior weblinks on how fast they shutdown mining production, plus how they said they will not sell potash [K] at a price they consider undervalued; a price too low to provide sufficient funding so that they cannot afford to ramp new production.

I have posted before on how I bet POT probably has a very impressive statistical and analytical research department that spends Bigtime for those high dollar proprietary reports. If Webb/Pomerene adds additional 'price-maker' clout--this is always better than being in the weaker 'price-taker' position where your company can just get hammered by powerful govts like China, etc.

Simmons has already much discussed how the global oil industry needs to get out of the 'price-taker' mode. Also, we had had many TOD keyposts on pricing volatility on oil, natgas, whale oil, whalebone, tulips, real estate, etc, and how it derails sound planning and subsequent execution.

Another example: You plan recreational boating on days with good weather, not on days with high seas and winds.

Toto says:
"You plan recreational boating on days with good weather, not on days with high seas and winds."

To which I add. Smooth seas never made a good sailor.


Hello Airdale,

What you said is absolutely true for Navy or Coast Guard sailors, on a boat designed for adverse conditions, with an experienced Captain at the helm [BTW, thxs for your service years ago!].

But that is not for a family man, trying to convince his wife and kids that he knows what he is doing, as they start to head 20 miles offshore into the teeth of a gale on a dinky 20-footer.

The Coast Guard or Harbor Police will arrest that guy for being an stupid idiot before he even clears the marina breakwater.

$70 oil menaces budding recovery of human plague

time for some $300 oil to nip those nasty buds in the bud. bye-bye, human parasite.

solar is a sham
wind is a scam
nuclear makes good bombs
fusion makes good pork
oil is almost gone
coal is full of mercury
but aren't those humans already mad as hatters?
tides bring nice rocks
and show the shellfish's cocks

plastic recycling is a scam
you can burn it to cook your ham
just like the third world does today
so you will do tomorrow

let's bust up the earth till she screams
in reams and reams of black seabreams

a roil of oil full of delicious spoil
milk chocolate from the rocky womb
squeezed out by a drill-dick

people just want to be happy
but i am here to tell them that they aren’t going to be happy
i am here to tell them that the world’s gonna be a shithole real soon

they will be homeless, jobless, busted, in jail or dead soon
90% of the world’s fish are extinct
the planet is almost dead already
humans will soon be killing each other over the last scraps of food

there will be no rescue
there will be no divine fucking intervention
there will not be a ‘better day’
better days already passed long ago

there will be ‘worse days’, and ‘worser days’ after them
there will be killing, murder, rape, rape of children, killing and eating of children
on a scale not yet seen before
don't worry about dogfood
your dog will soon be food
there will be acts committed that we don’t even have words for yet
and that will be just the beginning

just the beginning of a new deathlife for the survivors
their own private horrorshow filled with coming attractions

each day they will pray
for a nuclear war to wash away
the pain of gray