peak oil future oil shortages and mitigation/adaptation options for australian cities
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Peak Oil Future oil shortages and mitigation/adaptation options for Australian cities Bruce Robinson, Convenor. Look out !! Something serious is looming on the radar. ? ? ? ?. Peak Oil Future oil shortages and mitigation/adaptation options for Australian cities - PowerPoint PPT PresentationTRANSCRIPT
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Peak OilFuture oil shortages and mitigation/adaptation options
for Australian cities
Bruce Robinson, Convenor
? ? ? ?
Look out !! Something serious
is looming on the radar
2
Peak OilFuture oil shortages and mitigation/adaptation options
for Australian cities
Bruce Robinson, Convenor
? ? ? ?
Look out !! Something serious
is looming on the radar
3
www.ASPO-Australia.org.auAn Australia-wide network of professionals working to reduce oil vulnerability
Working groupsUrban and transport planningTown planning professionals (being formed)Finance SectorHealth Sector Social Services SectorRemote indigenous communitiesActive transport (bicycle & walking)Agriculture, Fisheries and FoodBiofuelsOil & Gas industryRegional and city working groupsConstruction IndustryPublic transport sectorDefence and Security Children and Peak OilYoung Professionals working group
Part of the international ASPO alliance
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Outline
This is about oil, not energy in general.
Transport (largely)Global oil supply, not just Australia's
● What is Peak Oil ?
the time when global oil production stops rising and starts its final declineWe will never "run out of oil"
● When is the most probable forecast date ? ? 2012 +/- 5 years
● Peak Exports is likely to occur sooner
● Oil vulnerability assessment and risk management plans are crucialfor city planning, and for governments at all levels
● Why does it seem like all decision-makers are in a state of denial ? ?
1930 1970 2010 2050
Peak Oilbutwhen?
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Macquarie report September 16th 2009 "The Big Oil Picture: We're not running out, but that doesn't mean we'll have enough"
September 17th 2009
2005 2009 2013
Toronto
Financial Times
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Key oil figures were distorted by US pressure, says whistleblowerExclusive: Watchdog's estimates of reserves inflated says top officialguardian.co.uk, Monday 9 November 2009
The world is much closer to running short of oil than official estimates admit, according to a whistleblower at the International Energy Agency who claims it has been deliberately underplaying a looming shortage for fear of triggering panic buying.
2008
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Two analogies for Peak Oil risks
1. Hurricane Katrina (New Orleans, 2005)
2. US Financial Crisis (World, 2008-09)
Can we learn to prepare for probable events rather than just hoping business will be as usual ?
What are the reasons for the ubiquitous and very risky "no-worries" attitudes of decision-makers
KOSPI
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Scientific American March 1998
First Major Article about Peak Oil
www.aspo-australia.org.au/References/Campbell%20Laherrere%20Scientific-American-March-98.pdf
1995
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www.csiro.au/resources/FuelForThoughtReport.html
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www.chathamhouse.org.uk/publications/papers/view/-/id/652/
Time for an energy bail-outPeak oil is just five years away, and we must start to plan now to avert a truly ruinous crisis
www.peakoiltaskforce.net
October 29 2008
August 2008
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The IEA "estimates that the average production-weighted observed decline rate worldwide is currently 6.7% pa for fields that have passed their production peak”.
The world is heading for a catastrophic energy crunch that could cripple a global economic recovery
because most of the major oil fields in the world have passed their peak production,
a leading energy economist has warned Fatih Birol, chief economist of the International Energy Agency (IEA), the developed world's energy watchdog
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"Even if oil demand were to remain flat to 2030, 45 m barrels/day of gross capacity -roughly four times the capacity of Saudi Arabia - would be needed just to offset the decline from existing fields"
2008
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Prof Kjell AleklettGlobal Energy Systems
Uppsala University, Sweden
Australian lecture tourJune 2009
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2008
International Energy Agency (OECD)
WEO 2008 and Uppsala Oil
Outlook 2008
2008
Uppsala Global Energy Systems
group
Using the same IEA datafields to be developed and yet to be found, and the same natural gas production
Different conclusions.
IEA production forecasts are "outside reality", not possible.
(because IEA have assumed impossible production rates from the reserves)
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"A MIDDLE EAST VIEW OF THE GLOBAL OIL SITUATION"A.M. Samsam Bakhtiari National Iranian Oil CompanyMay 2002
Global oil crunch at the horizon --- most probably within the present decade.
"...It would take a number of miracles to thwart such a rational scenario..
A series of simultaneous miracles is not possible --for there are limits even to God Almighty's mercifulness".
“Noah built his ark before it started raining”
It is very hard to build an ark under water !!!
We must start preparing our cities for Peak Oil in advance
www.isv.uu.se/iwood2002
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Dr. Sadad I. Al Husseini, ex Saudi AramcoOil and Money Conference, London, October 30, 2007
...predicts a 10 year plateau
a structural ceiling determined by geology
100
90
70
80
Production M b/dayPrice
$/barrel
Economists say "As prices rise, production will increase". Clearly false from these data.
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Germany, October 22 2007
Fig. 7 Oil production world summary
2008www.energywatchgroup.org/fileadmin/global/pdf/EWG_Oilreport_10-2007.pdf
IEA WEO 2008
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A simple observation -- or why peak will be earlier than most people expect
‘Global production falls when loss of output from countries in decline exceeds gains in output from those that are expanding.’
Decline
Expansion
Chris Skrebowski Editor, Petroleum Review,
London
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THE GROWING GAPRegular Conventional Oil
Billion barrels of oil per yearLongwell, 2002
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Perth’s Central Park building is 249 m high, to top of tower
Australia uses 51,000,000,000 litres of oil each yeara cube of about 370 metres size
80% of Australia’s oil usage is in transportIf Australia’s 20 M tpa wheat crop → ethanol = ~10%
100 ml of oil contains 1 kWh of energy. Enough to move a small car to the top of the Eiffel tower
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ABARE Australian CommoditiesMarch 200922 million in 2006
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Australia China United States
1 kml l
Million barrels/ day 2008 BP Statistical Review, 2009
Australia uses 0.94 China 8.0US 19.4World 84.4 US 1 cubic km oil / year
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Mortgage and Oil Vulnerabilityin Perth
www.griffith.edu.au/__data/assets/pdf_file/0003/88851/urp_rp17_dodsonsipe-2008.pdf
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September 2009Maribyrnong City Council’s
Peak Oil Contingency Plan a first for Australia
Sunshine CoastRegional Council
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0.0
0.2
0.4
0.6
0.8
1.0
1965 1975 1985 1995 2005 2015 2025
Million barrels/day
Actual ForecastAustralia
}$15.7 billion2008/09
P50
Consumption
Production
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Failure to act now will prove incredibly costlyWe must recognise the urgency, and leave the "business as usual" cult.
Oil vulnerability assessment and risk management are crucial important tools for planners, governments and investors.
Building more distant suburbs, urban freeways and tunnels will soon be seen as crazy
These slides at http://tinyurl.com/Cities-Peak-Oil
www.ASPO-Australia.org.au
Hint: Check your superannuation is not being invested into urban toll-roads, tunnels and airports.
General priorities for facing Peak Oil1: Awareness and engagement 2: People solutions Frugality Efficiency
Last: Alternative fuels and technologies
1ADX♦245STATE OF AWARENESS
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a few more slides follow,in case they are needed for questions
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1: “Talk about it, Talk about it”2. Engage people, “Participatory democracy”3. Dismantle the "perverse policies" that subsidise heavy car use and excessive freight transport.
Australian Government Policy and Action Options
4. Encourage frugal use of fuel, and disadvantage profligate users. Fuel taxes should be incrementally raised to European levels to reduce usage.5: SmartCard tradable personal fuel allocation system. A flexible mechanism for short-term oil shocks, as well for encouraging people to reduce their fuel usage..6. Concentrate on the psychological and social dimensions of automobile dependence, not just “technological fixes”7. Implement nationwide "individualised marketing" travel demand management.8. Railways, cyclepaths and public transport are far better investments than more roads.9. Give priority for remaining oil & gas supplies to food production, essential services and indigenous communities, using the Smart-Card system.
10. Review the oil vulnerability of every industry and community sector and how each may reduce their risks.
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Australian petrol & diesel rationing using 2008 technologySmart-card based, scalable, tradeable, flexible, quick to change, equitable, transparent.
Fuel allocations should be per person, not per vehicle, and depend on Location (inner or outer suburb, public transport access, regional or remote) Health status (elderly or infirm, expectant mothers with toddlers), less for the fit
who can ride a bicycle 20kms if needed Job importance (defence, essential services, hospitals, food)
People are encouraged to conserve by being able to trade unused allowances electronicallyand automatically.
Martin Feldstein, Chief Economic Advisor to President Reagan, now at Harvard, (WSJ 2006)
"tradeable gasoline rightsare more efficient than fuel economy standardsor gasoline taxes"
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Coal
Gas
Oil
OtherTotal Energy UsageAustralia, 2000ABARE
Kenneth E. Boulding, economist1910-1993
"Anyone who believes exponential growth can go on forever in a finite world is either a madman or an economist."
Metropolitan passenger travel AustraliaBTRE
Car
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0
20
40
60
80
100
120
140
160
Sep-0
1
Sep-0
3
Sep-0
5
Sep-0
7
Sep-0
9
Sep-1
1
Actual price
March 2009prediction
March 2008prediction
March 2007prediction
March 2006prediction
March 2005prediction
March 2004prediction
ABARE's oil price forecasts have proven to be systematically low in normal timesWTI US$/bbl
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0
10
20
30
40
50
1930 1950 1970 1990 2010 2030 2050
0
1 0
2 0
3 0
4 0
5 0
World oil shortfall scenarios
Past Production of Oil
ForecastProduction
Demand Growth
Deprivation, war
City design/lifestyle
Pricing / taxes
Transport mode shifts
Efficiency
Other petroleum fuels gas, tar-sands
Other fuels
Gb/year
• no single “Magic Bullet” solution, • probably no replacement ever for cheap plentiful oil• Urgent preparation and adjustment are vital
2009
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“OK, it’s agreed – we announce that to do nothing is not an option and then we wait and see how things pan out”
from ‘Private Eye’
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Energy White Paper, 2003
Coal
Gas
Oil
Other
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Government of Western Australia
STATE LIQUID FUEL SHORTAGE
EMERGENCY PLAN
OPERATIONAL PLAN PREPARED BY
ENERGY SAFETY DIRECTORATEDEPARTMENT OF CONSUMER
AND EMPLOYMENT PROTECTION20 Southport Street, W Leederville WA 6007Tel: (08) 9422 5200 Fax: (08) 9422 5244
January 2003Current WA Government planning for a sudden fuel shortageIneffective and inequitable. Odds & Even number plates etc
Nothing significant about public transport
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discussion paper, Liquid Fuel Emergency Act review, 2004
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A rational pricing system Perth domestic water
Renewable scarce resource
A personal fuel SmartCard system could tax petrol and diesel on a sliding scale like water.
People could trade unused allocations to those who want more fuel.
Water Analogy for Fuel Pricing
$0.00
$0.50
$1.00
$1.50
$2.00
0 150 350 550 950
Perth domestic water prices per kilolitre 2008
Consumption range kilolitre/year
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toroads,4WDsprofligate vehicle usersheavy inefficient vehicles
Supermarkets subsidise CO2 $18/tonne with their fuel dockets
Supermarket petrol discounts
People who walk to the supermarket are subsidising those who drive in the big SUVs
There are innumerable “Perverse” subsidies
0%
10%
20%
30%
0 15,000 25,000 40,000
FBT tax on motor vehicles
km range
FBT tax on cars as part of salary
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Petrol taxes OECD
IEA Dec 2003
Korea
UK
Australia
US
€ 0.80
0.60
0.00
0.20
0.40
Au$cents/litre
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The UK Fuel Tax Escalator Margaret Thatcher
Australian fuel taxes should be raised to European levels on a fuel tax escalator
1988 1990 1992 1994 1996 1998
Nominal tax per litre (pence)
Real tax
10
30
50
40
20
0
pence
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China
US
Australia
43www.ASPO-Australia.org.Au
Bicycles are powered by biofuel, renewable energy,
either Weetbix or abdominal fat
No shortage of either
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Urban passenger mode shares Australia
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000
Mo
de
sh
are
(p
er
cen
t)
Car
Rail
BusOther
Potterton BTRE 2003
High automobile-dependence
Public transport share is very low
Car
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WORLD OIL & GAS PRODUCTIONASPO 2008 base case
0
20000
40000
60000
80000
100000
120000
140000
1930 1950 1970 1990 2010 2030
kb
/do
e
NonCon GasGasNGLPolar OilDeepwater OilHeavy OilReg.Oil
140
120
100
80
60
40
20
0
Million barrelsper day
(equivalent)
2009
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Jeff Rubin
September 2007
Canadian Imperial Banking Corporation
Iran 10c/litreVenezuela 2c/l
www.aspo-ireland.org/contentfiles/ASPO6/2-3_ASPO6_JRubin.pdf
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50
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}0
10
20
30
40
50
1930 1950 1970 1990 2010 2030 2050
2007
World oil shortfall scenarios
Past Production of Oil
ForecastProduction
Demand Trend
Gb/year
0
10
20
30
40
50
Shortfall
By 2030, the gap is equivalent to 6,000 nuclear reactors
2030
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February 2004
By 2015, we will need to find, develop and produce new oil and gas equal to eight out of every 10 barrels being produced today.
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Why are oil supplies peaking?
• Too many fields are old and declining• 54 of 65 oil producing countries are in decline!
• Oil supply will peak in 2010/2011 at around 92-94 million barrels/day
• Oil supply in internationaltrade may peak earlier
• Collectively we are still in denial