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At last, a government has a go at peak oil!!

Hello. Webdiary has been banging on about the dangers of peak oil for years now, largely due to the efforts of Ian McPherson, who went on to found sydneypeakoil. The problem of quickly diminishing oil supply has been known about for decades, and was one of the reasons Dick Cheney wanted to invade Iraq. But Australian governments have buried their heads in the sand, to the medium and short term detriment of their citizens.

Yesterday, the Queensland Government issued a report on peak oil, after lots of good work behind the scenes by activists. I'm hoping to publish a report on that work soon. Here is the Queensland minister's statement. The full report is here.


Minister for Sustainability, Climate Change and Innovation
The Honourable Andrew McNamara

Thursday, October 11, 2007


A report tabled in State Parliament today highlights the need for Queensland industry, primary producers and communities to lessen their dependence on imported oil supplies.

The report – Queensland’s Vulnerability to Rising Oil Prices – was tabled by the Minister for Sustainability, Climate Change and Innovation, Andrew McNamara, who authored the report as a backbencher before his appointment as a Minister last month.

Mr McNamara said the report canvassed a range of options for reducing Queensland’s reliance on oil imports, from reducing our demand to developing alternate energy sources.

“I’m now in the unique position, as the Minister for Sustainability, Climate Change and Innovation, of having to co-ordinate a whole-of-Government response to my own report,” Mr McNamara said.

“Obviously, as the report author, I have some ideas on what needs to be done, based on what I discovered as part of preparing the report, and the report makes a range of recommendations.

“However, the most important thing I learned was that, while further analysis needs to be done, this issue is both real and imminent.

“The focus of the report was the concept of peak oil – the point at which maximum world oil production is reached - which is predicted to lead to shortages and consequent significant price increases.

“If nothing changes in our energy mix and demand patterns after that point, we can expect significant liquid fuel price increases, and price increases in those things that are made from oil such as fertilizer and plastics and those things that rely on oil such as agriculture, construction and transport.

“The Taskforce sought to present the most likely time frame for peak oil, to assess its impact on the mining, transport and primary industry sectors, and then recommend options to minimise the impact on Queensland.

“The report concludes that the overwhelming evidence is that world oil production will peak within the next 10 years.

“The report recommends that a prudent risk mitigation approach requires a mix of initiatives such as:

• reduction in consumption of liquid fossil fuels;

• encouraging the development and use of alternative fuels, technologies and strategies; and

• preparation for demographic and regional changes, as Queenslanders change travel, work and living habits in response to rising fuel prices.

“The future availability of fossil fuel and alternate energy supplies is one of the main sustainability issues facing society today.

“The recommendations are preliminary, and more detailed analysis including detailed modelling of the downstream impacts and substitution effects of the various proven and evolving alternative energy technologies will be a necessary next step.”


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Stuart writes: "The key to all this will be de-centralised energy and transport systems, as well as re-localised food and employment. We've spent the last 50 years or so building centralised energy systems and moving ever further away from our work and food sources (not to mention replacing some of our best agricultural land with energy guzzling McMansions) based on the assumption of cheap fuel. Utter madness."

Complete agreement from me.  There was a movie doing the rounds a while ago about the impact of peak oil on America.  It was called The End of Suburbia.  I think this is what the end of reliance on fossil fuels means.

Limits To Growth

Stuart, thanks for your efforts. You obviously have a good understanding of the situation we're in with regards to conventional oil and gas.

I have to laugh when I hear people describe peak oil as a 'theory'. Peak oil is a theory in much the same way that the spherical Earth is a theory. Apart from a few people spouting nonsense about abiotic oil, there is no dispute that global oil extraction rates will peak and then gradually decline. The only meaningful debate is about the timing and the consequences of the phenomenon.

Many people wrongly assume that peak oil means the end of oil. It does not. Peak oil signals the end of cheap energy. The trouble is, we have built a society and a physical infrastructure on the premise that cheap energy will always be available in ever increasing quantities.

I suspect that most people in the developed world will first experience peak oil as an economic problem. As potential demand exceeds supply, bidding contests drive up the price until economies are damaged sufficiently to extinguish some discretionary demand. As supply declines further, the cycle repeats until there is no more discretionary demand to crush. In many respects, we are seeing that process begin now.

The situation is complicated by the rapid growth of domestic consumption in oil exporting nations. High oil prices are stimulating their economies significantly. Those who rely on imports will experience a far sharper drop in the availability of oil than simple decline rates would suggest.

Higher energy costs are also kicking price inflation along. Energy is a required input at every step in the value and distribution chain. Nowhere is this fossil fuel nexus more important than in the production of food. Most people are simply unaware that, since the 'Green Revolution' in agriculture and on average, every calorie of food energy they consume has used at least ten calories of fossil energy to get that food to the table.

I suppose it is natural for people to look for the magic bullet(s) that will slay the peak oil dragon. The problems would have been challenging enough in the absence of the risks of anthropogenic global warming and the consequences of climate change. Strategies such as coal-to-liquid, tar sands and oil shales require vast amounts of fresh water for processing and release enormous quantities of sequestered CO2 into the atmosphere.

Biodiesel is no magic bullet. It requires nitrogen, phosphorus, potassium, water and sunlight to grow it, and if you want decent yields year after year, fertiliser will be required. Fertiliser is energy and it is already getting very expensive. If you have to choose between using water and fertiliser to feed people or to feed internal combustion engines, the answer is a no-brainer.

I have no doubt that we are in for a very difficult transition as peak oil really starts to bite. It will be easier if we don't hold on to the fantasy that we can continue to squander energy with business-as-usual.

Michael, Will You Join Us?

Michael, thanks for your post. I read in a different thread that you work in the Queensland sugar industry. ASPO is trying to spread its influence further throughout Queensland and you sound like an ideal candidate. Could you consider this and contact me via the ASPO website?

Opposition MP Roseamary Menkens, Member for Burdekin, helped to flush out the McNamara report in Parliament last week. She and her colleagues in rural and regional electorates (including the sugar-growing regions) have a key role to play and we are endeavouring to support them as best we can, along with all other public officials, in a non-partisan manner.

Simple Reductions

To reduce dependence on heating there are simple things to do eg insulation.

The only problem is the ignorance of those in charge.

I'm glad someone has pointed out the down side of Jatropha and other imported non solutions. We already have seed oils established which are compatible and have varied uses along with natives able to provide a lot of seed oils. Wild radish produces 43% oil, brown mustard 40% and makes a lovely cooking oil. Biodiesel isn't a long term answer, but a transitional one as it doesn't provide us with a fuel supply which overcomes the problems completely. We already have the technology to solve all our problems of generation and storage using flow batteries http://www.axeonpower.com/flow.htm. King Island uses flow batteries as does places in Thailand, India that I know of and probably other places for storage from it's bio/veggie/small hydro/wind generators which provides 24hr a day power. We use solar and wind for energy to power our two houses and soon to be opened restaurant/backpackers. Seed oil powers a generator for workshop power, veggie drives our 53ft motorsailer, tractor and vehicles which reduces not only our carbon foot print, but lowers our costs dramatically. Even someone with just an average backyard could produce some oils and food for domestic cooking use and using local cooperatives to process it would be a good start. The first step to helping this country cope with the environmental changes, is to stop population growth, get rid of non indigenous meat products and associated industries which debilitate the land and only use what this country can provide sustainability.

The emissions from biodiesel are far below fossil oils http://www.journeytoforever.org/biodiesel_nox.html

You can use biofuels and dispose of the waste from it's production without polluting, just put it into your compost, worms love it, unlike fossil oil products which destroy everything they touch and are very carcinogenic. Fission will never come to be, as I requires us to harness an energy force we have misinterpreted and have no understanding of what really powers stars. Hydrogen and solar are the only sustainable long energies and vegetable oils can replace everything made from fossil fuels, clean coal, another pipe dream of the academics. The problem is the people in control of our parliaments and government institutions all seem to be ignorant of anything but their superiority complexes, in the face of the reality of their total stupidity, lack of knowledge and viewable outcomes for the real world.

I understand Malcolm B, Duncan's viewpoint, it relates beautifully with the verifiable outcomes produced by lawyers in politics and our society, the blind leading the blinded. I'd put my faith in someone with hands on experience rather than as is currently, people put their faith in those with little practical experience of the realities of the world. That's why nothing of a positive nature gets done other than semantic waffle, repeat never fulfilled promises, reams of meaningless reports, empty words and denials from fools who get their knowledge from ignorance. Which gives us outcomes the complete opposite to what is required, as we currently are experiencing.

What bugs me most of all is people run round looking for solutions which don't equate to our countries unique circumstances, so they want to import anything they think will solve the problems we face. This country can provide from its natural environment, everything we need to ensure a sustainable life and an ever increasing positive environment. We need real practical outcomes, not academic ones. Just look at the present political campaign, academics waffling on about nothing, just fluffing their feathers, complaining and putting out reams of empty rhetoric with not one solution for climate change, or any other portfolio or scenario. Malcolm, who'd want to debate a lawyer about climate change in the middle of a city? It's like debating the universe whilst spending your entire life in a windowless box. It's irrelevant as to whether it's climate change or not, something is dramatically changing our continents ability to sustain our debauched approach to life. From what you say, I doubt you have a clue about what's happening outside your deluded comfort zone, in the real world of rural Australia. So a vote for you, would be a vote for nothing of substance, but a rear end short term emission.

Put your head above the parapet...

Well, to answer your question directly Alga Kavanagh:

 Malcolm, who'd want to debate a lawyer about climate change in the middle of a city?

I would.  There's a simple reason for that: the lawyer I want to debate is the Water and Environment Minister and what I want to ask him is why we don't have a Federally-funded project to research the most efficient way of using solar power to generate the dissassociation of H2O into H2 and O.  Then, think big: one of the problems this country currently has is that we don't have enough water where we need it (once the place was a swamp but I guess you don't need reminding of that because you seem to know everything including what I think.)    You move the water by pumping the H2 to where you want it and burn it.  How we pay for it is the question.

If you don't  like lawyers, don't come to Wentworth to vote.  The only declared candidates who aren't lawyers are a nice Canadian woman standing for the Greens (she's a nurse who's giving her preferences to the Opposition who have announced as policy that they won't stop the Pulp Mill) and an 18 year-old "customer services officer" (if I caught it correctly) who is so jejune that he's joined the Democrats.    That strikes me as a bit like a small mammal applying to join the flesh-eating dinosaurs club.

You are as entitled to your opinion as anyone else.  That's the downside of democracy.  Restraining yourself from expressing it is the upside of etiquette.

Harness up old Dobbin!

John Pratt: Your link to the Chinese 13 million hectare jathropa plantation took me to a publication called IfEnergy which confirmed what you quoted:

"The Chinese are aiming at doing something tremendous. This month, the Chinese government revealed plans to put up a 13-million hectare jathropa plantation, capable of producing over 6 million liters of biodiesel per year! According to the State Forest Administration, this plan is in recognition of the viability of biofuels and the need for a diversified energy base for Chinese transport. On top of the biodiesel produced from the nut of this particular tree, wood from the plantation will also be used to generate power as fuel for a 12 MW power plant facility also being designed within the plantation area.

"When you are thinking of putting up a plantation the size of England, you are an ardent support of renewable energy solutions! Read more about this development here" [link to China Daily].

Unfortunately the China Daily link does not work. At least not on my  poor old steam-driven computer.

But the figures are as you quoted. Thirteen million hectares to produce six million litres of biodiesel per year. That is, it takes 2.17 hectares (or 5.35 acres) of land to produce one litre of biodiesel. If that land was in one of the Australian wheat-growing areas, a passing fair wheat farmer in an ordinary year weather wise could get two tonnes of wheat per acre off it, or around 11 tonnes. Provided he could fuel up his tractor, that is. But something tells me that the jathropa grower's single litre of biodiesel wouldn't drive it very far.


Sometimes, just sometimes, I suspect that I am too subtle for my own good - one of the reasons, no doubt, why I would make a lousy advocate.

Perhaps this clarification would help.

If we are going to evaluate different sources of energy properly, surely we need to be aware of (1) the environmental inputs (including carbon and other greenhouse gas emissions) of their creation, and (2) the environmental outputs (including carbon and other greenhouse gas emissions) of their use.

Until we have an accurate statement on both sides of that particular equation, how can we possibly make any sensible evaluation of the relative costs and benefits? It seems to me to go way beyond comparing apples and oranges.

PS I am going to bed now, so any further debate on my part will have to await the morrow.


Not presently measurable.   That's part of the essential problem.

 Sweet dreams Dr.

It's the Economy, Stupid

Malcolm, so what is your response to this conclusion of mine from a previous post (read the post for the sums)?

... even if you ignore climate change, unless we take urgent steps to move on from our fossil fuel dependence we will be staring down the barrel of economic collapse within the next decade. History will take a dim view of this generation's apathy if we allow this to happen.

Summa somata

Stuart McCarthy, haven't read it - don't have time to.   That's what the pressure of a campaign does.

 Do me a short summary, email it and I'll look at it.

From the skip-read, however, my current thinking is that we should be concentrating on preserving our mineral resources either to value add to them or wait until everyone else runs out first.   But that involves a significant adjustment to Defence policy doesn't it?   Think.

I am not prepared to fire off macro policy from the hip.    Our country's future is in our hands.   We are the responsible ones but we are responsible to one another, all ones and all others.  Do we wash before eating?    If we do, of what are we washing our hands?

You're Either Part of the Problem or Part of the Solution

That's exactly the problem, Malcolm. Despite waffling on endlessly in this forum with your pseudo-humour, you're too busy with your 'campaign' to scroll down the page a little bit and spend 30 seconds reading about what's going on in the world. It's high school maths and primary school reading comprehension mate. Even a lawyer should be able to cope with that.

Biodiesel 67% cleaner

Hi Fiona;

According to this article

The overall smog forming potential of biodiesel is 67 percent less than diesel fuel, the company states. Its analysis of biodiesel emissions show decreased level of polycyclic aromatic hydrocarbons and nitrate polycyclic aromatic hydrocarbons, which have been identified as potential cancer causing compounds.

And our little miracle plant is also apparently useful for

Used in traditional medicine against a long list of ailments including burns, cough, stomachache, gonorrhea and syphilis, inflammation, jaundice, paralysis, pneumonia, rash, tumors, and ulcers, the Jatropha has latex that contains an alkaloid, jatrophine, which shows anti-cancerous properties. The extracts have been used in folk remedies for cancer.

And from here;

Preliminary research indicates Jatropha may display certain Anti-Tumor properties, Anti Malarial properties and research is advancing related to HIV/AIDメs and immune system response enhancement. There are other levels of use that can be exploited. Direct fermentation of seed cake and pulp delivers an organic fertilizer that has a high potential for export to developed countries. 

However, it's still not christmas;

There are still some inherent problems with Jatropha and research work is still required. We are learning more and more about the properties of Jatropha. These potential problems include:

1) Jatropha oil is hydroscopic - absorbs water and needs nitrogen blanketing on steel tanks. One issue that is quite clear is because Jatropha is high in acid, it has the tendency to degrade quickly, particularly if not handled properly through the supply chain.

2) Right from the time of expelling, the oil needs to be kept in storage conditions that prevent undue degradation. Exposure to air and moisture must be minimized - hence the need for nitrogen blanketing on the tanks.

3) The range of fatty acids present in the various seeds will differ but the oil and biodiesel that is produced must be acceptable. However, this assumes that that oil is fully degummed. The degumming may well be more of a problem than making biodiesel!

4) The phospholipid, protein and phorbol ester contents in edible Jatropha seem to be quite different compared to these contents in non-edible Jatropha. It needs to determined if this affects the degumming method. The degumming removes lecithin and other related compounds, so if these are high than a modified degumming method may be needed. If the oil is properly dried after degumming and kept under nitrogen blanketing this may suffice. Biodiesel companies are investigating storage requirements and the oxidative stability of Jatropha.

5) Seeds degrade as soon as they are picked and so careful storage and handling is required. In the warm humid atmosphere in countries such as Ghana the degradation of seeds can be rapid. Even in the U.K. seed storage is a problem. Recently a U.K. importer had samples of rapeseed that had been harvested and stored in wet weather. The analysis showed that they had 28% of free fatty acid! The free fatty acid must not increase above 2%.

6) There has never been a highly commercial group handling Jatropha Curcas harvest and derivatives.

And a final note of caution;

Jatropha was under promotion in Thailand. The seed oil of Jatropha possesses tumor-promoting substances. When this oil comes in contact with human skin there are chances of skin cancer. The researchers of Thailand conducted detailed research on this aspect and published the research paper titled "Presence of Tumor promoter in the seed oil of Jatropha curcas from Thailand" in the prestigious Japanese Journal of Cancer Research. 

The delusion of biodiesel?

Look, I am a mere lawyer/academic psychologist. So, could someone please explain - what does biodiesel produce when burned?

After all, for some years now anyone daring to have a wood fire has been castigated for producing carbon dioxide.

So, what's so wonderful about biodiesel? The fact that it is a renewable energy source? Surely the aim of anyone who is serious about reducing carbon emissions is to move to sources of energy that don't produce carbon dioxide at all?

School Chemistry

Really, Dr Reynolds - ask your daughter.

Burning these things produces a number of "greenhouse gasses" - carbon dioxide, carbon monoxide, water vapour, and a combination of any other contaminant in the fuel.

It also produces something I don't hear many people talking about because it isn't a gas: heat.

The objection I have to all the proto-scientific bunk being put about relating to climate change is that the planet is a dynamic system which undergoes (and has always undergone) change in its atmosphere.   The bugger heats up, cools down and explodes periodically in a way we have no idea of predicting, let alone controlling and if any Webdiarist wants to take me on, fine, just organise a time and place for a public debate before 24 November at an appropriate Sydney venue.

Fiona: Oh really, Malcolm, surely you in your time have asked the odd leading question?

Fusion confusion

Stuart: I agree with you. 'Fusion' has always been about 50 years away for at least the last 50 years. But that is fusion based on Tokamak reactors, which have to achieve the core temperature of the sun (around 10 million C) inside a magnetically confined internal plasma chamber order to work. My understanding is that  researchers to date have got to within one percent of that required temperature.

Sonofusion is not based on Tokamaks. It uses at present bench-top sized reactors, with tiny local hotspots inside achieving fusion temperatures and, on the face of it, actual fusion: detected by neutrons coming off at the predicted energy levels.

There has been enormous opposition to sonofusion development, and one of the principal researchers has come under extraordinary personal attack, with attempts being made to block all further research on his part.  Given that fusion has such fantastic potential, one wonders who and what vested interests are behind it.

The near future will be one of many energy sources: biodiesel, solar, methane generators, geothermal power, natural gas, and even limited amounts of energy from nuclear fission and 'clean coal.' Hydrogen is abundant in sea water, and one hydrogen atom in about 7,000 is a 'heavy hydrogen' or deuterium atom: the kind needed for fusion reactors (and hydrogen bombs.)  Because the energy released when 2 hydrogen atoms fuse to form helium is so huge, the deuterium we have in sea water is essentially an endless supply. In my view, research into 'cold fusion'  is an excellent investment, and far better than state investment in 'clean coal' and nuclear fission. 

Sorry Stuart

I'm just trying to digest everything in your reply.  Thank you.  I need to sleep on this.

Thermodynamics, Energy 'Sources', Economics etc

Ian, I agree that we should be investing in research for "many energy sources", including fusion, but most of what you have referred to are not 'energy sources' but 'energy sinks', i.e. you end up putting more energy into the process than you get out at the other end. The laws of thermodynamics, taught in high school, are the central issue in the peak oil debate that most people overlook.

Hydrogen is a classic example. Yes, hydrogen is abundant, but to split it from H2O requires huge amounts of energy through electrolysis or whatever other method. Notwithstanding a fusion breakthrough we are better off using the electricity to start with. A smart method might be to use solar powered hydrogen plants at the local level for essential services/specialist uses, but it certainly will not be able to replace petroleum powered cars on an industrial scale.

Ethanol is another classic energy sink, and much of the current inputs come from oil and gas anyway (fertiliser, pesticides, irrigation, farm machinery). And that's before you consider the moral issue of burning food commodities in an era when the world's grain stocks have halved in the last five years and millions are already starving.

We should be using natural gas as a 'bridging' fuel in Australia because you can retrofit the ICE to run on say CNG (diesel trucks, trains, construction equipment etc are another question). The McNamara report suggests CNG-electric hybrids as one option. At the moment we are exporting cheap gas and importing expensive oil. Using our own natural gas would buy time if we acted quickly, but it would only buy us time, not solve the problem. Gas is also finite and its production will peak soon too. We need to use that time to build solar power stations, electric high-speed rail and the other key infrastructure that can realistically be sustained in the long term.

Longer term there is no alternative than to reduce our energy consumption per capita/unit of GDP. The only genuinely sustainable energy source is solar (which is also the source for wind and photosynthesis). We need to reduce demand, electrify everything and build distributed renewable energy networks. We need to re-localise as much as we can, including work, transport and food production.

The big problem is that the current economic paradigm requires perpetual economic growth, which in turn requires growing energy consumption (mostly from oil, or coal which requires oil) or the economy collapses. Neo-classical economics assumes infinite supplies of everything or that a critical commodity can be 'substituted' by another if the price is high enough. Both assumptions are invalid in the case of oil. Unless we quickly implement a steady-state economy (e.g. full reserve banking rather than fractional reserve banking, gold standard rather than fiat currency) we are well and truly screwed. This is heresy for neo-classical economists. They will allow 'the market to sort it out', i.e. collapse, before they do anything.

And what are the major parties doing at the moment? A cynical vote-buying war promising to spend billions on motorways in electorates with the worst public transport and highest vulnerability to rising oil prices and interest rates in the country. Truly sickening stuff.

Before we sink into total paralysis

Stuart: "I agree that we should be investing in research for "many energy sources", including fusion, but most of what you have referred to are not 'energy sources' but 'energy sinks', i.e. you end up putting more energy into the process than you get out at the other end. The laws of thermodynamics, taught in high school, are the central issue in the peak oil debate that most people overlook."

An energy sink is not simply a transducer that is less than 100% efficient, requiring  more input energy than it makes available as output. One of the laws (No. 2) of thermodynamics says that there cannot be 100% efficiency in energy conversion, so waste heat will always be with us and inefficiency in that sense applies to all transducers. An energy sink is a purported energy source whose energy cost in setup and operation is greater than the total energy return from that source. I have read arguments to the effect that the fission power industry as a whole falls into this class. However, I have yet to see an argument that the energy used in petroleum extraction and refining is greater than the total of that obtained from the petroleum when used as fuel.

My original list was "biodiesel, solar, methane generators, geothermal power, natural gas, and even limited amounts of energy from nuclear fission and 'clean coal.'" Would you mind expanding on which of those is an energy sink, and why in each case? 'Clean coal' is a fairly obvious target, I grant you, but there is an enormous economic push to get it going, and if some infrastructure is set up by the time the Laberals in power change their minds on the matter, it might as well be used. 

So which particular law did I overlook in the post you referred to?

Thermodynamics of Energy Systems, not Just 'Sources'

Ian, you got the laws of thermodynamics right, just not a sufficiently rigorous application to energy systems rather than individual sources or processes. I will talk about industrialised biofuel and nuclear fission, both of which still rely on huge fossil fuel inputs.

Biofuel. Growing crops requires nitrogenous fertiliser from gas (not to mention phosphate, which has already peaked, or other minerals and trace-elements that have been systematically mined from the soils through industrialised agriculture); diesel and petrol for tilling, planting, harvesting, irrigation and transport; petrochemical fertilisers; electricity (coal generated electricity in this country, noting also that peak coal is approaching within a couple of decades) and diesel to turn the plant matter into fuel; and petrol and diesel to distribute the fuel.

Nuclear Fission. Diesel, gas and electricity to mine the uranium and transport it to processing facilities; diesel and electricity to build the processing facilities and power stations; diesel and electricity to process the uranium into nuclear fuel; diesel and electricity to dispose of the waste and/or re-process the fuel; and the key factor that most overlook - huge energy losses through the electricity transmission system to its point of use.

If you take all of these inputs and turn biofuels and nuclear fission into net energy providers, you need a new calculator!

Far and away the biggest energy sink, however, is our industrialised food production and distribution system. Dale Allen Pfeiffer estimates that each unit of energy in the food on our table consumes around seven to ten units of fossil fuel energy in its production and distribution. He calls this eating fossil fuels. The biggest problem arising from peak oil will not be figuring out how to keep cars on the road; it will be figuring out how to feed 20 million people spread across the driest continent on earth, with the poorest soils on earth, when the industrialised, fossil fuel dependent agriculture and food distribution system collapses. The 'free-market' response thus far has been to turn food into fuel, put it onto our petrol tanks and burn it, then wonder why food is getting so expensive. Utter stupidity.

The key to all this will be de-centralised energy and transport systems, as well as re-localised food and employment. We've spent the last 50 years or so building centralised energy systems and moving ever further away from our work and food sources (not to mention replacing some of our best agricultural land with energy guzzling McMansions) based on the assumption of cheap fuel. Utter madness.


Stuart: "Ian, you got the laws of thermodynamics right..."  

Phew! That's a relief!

"...just not a sufficiently rigorous application to energy systems rather than individual sources or processes."

Knew it was too good to last.

" I will talk about industrialised biofuel and nuclear fission, both of which still rely on huge fossil fuel inputs.

"Biofuel. Growing crops requires nitrogenous fertiliser from gas (not to mention phosphate, which has already peaked, or other minerals and trace-elements that have been systematically mined from the soils through industrialised agriculture); diesel and petrol for tilling, planting, harvesting, irrigation and transport; petrochemical fertilisers; electricity (coal generated electricity in this country, noting also that peak coal is approaching within a couple of decades) and diesel to turn the plant matter into fuel; and petrol and diesel to distribute the fuel."

Etc, etc, etc.

This discussion began over energy sources. Most of the energy sources I mentioned promise to yield more energy than they consume: they are in other words net energy sources. You dispute that. I asked you to explain why, and so far you haven't. Just one example from the above spray: "Growing crops requires... diesel and petrol for tilling, planting, harvesting, irrigation and transport ... diesel to turn the plant matter into fuel; and petrol and diesel to distribute the fuel." So either we are stuck because we need diesel (running out) to make biodiesel, or we are stuck because biodiesel cannot be used to generate enough biodiesel to cover the energy needed in its manufacture plus enough left over as a surplus for other uses. I accept only that diesel from peroleum is running out.

I don't think that the system will just collapse - bang, finish, gone. Fossil fuel will get more expensive, creating a market for renewables but diverting consumers' discretionary expenditure away from certain areas of the market, like luxuries. But any manufacturer who switched at present and out of principle to renewables and away from fossil fuels would be priced out of the market.

If you have electricity, you can do just about anything - for a price. Solar is growing big time overseas, as is wind generation. Both of those can be self-perpetuating: eg wind generators generating enough power to replace themselves and create a surplus: the very opposite of ergonomic sinks.

The Second Law of Thermodynamics (I got it right - phew again!) unfortunately tells us that we are inevitably spreading the concentrated deposits of phosphorus, iron and other elements all over the planet. We have a way to go before the process is complete, but we do know that energy will be needed to counter that entropy gain. You are right to stress that. It would appear that in the long haul we are moving towards a radically different economy from the one we know.

I believe that markets will always be with us, in one form or another, as long as there is an 'us' for them to be with. But their options are changing, of which Mr Howard is starting to become aware. The human economy is like the atmosphere and the biosphere: far too complex to be comprehended in its totality, even with the best computer hardware and software avaliable. But there is much room for optimism, as long as vested intests don't divert too much investment capital into boondoggles.

Optimism vs Collapse; Industrial vs Local Biodiesel

Ian, I think we're getting somewhere. If I wasn't an optimist I wouldn't bother trying to convince people that there is a problem that needs to be solved; and I don't believe that "the system will collapse" unless we allow it to. Unfortunately, the prevailing neo-classical economic worldview is based on precisely that premise - allowing 'the market to sort it out', i.e. collapse, before deigning to intervene. Hopefully there will be a relatively minor 'collapse' (e.g. the airline industry) which serves as a wake up call for us to prevent a major collapse. Only time will tell.

I stand by my argument that industrial biodiesel (based on broad-acre farming of oil seed crops, then produced and distributed a long way ffom point of manufacture to point of use) is an energy sink. There are so many energy inputs and individual entropic transactions through the process I described that this is self-evident. I only included the point that its production currently relies on fossil fuel inputs to emphasise how reliant current industrial processes are on fossil fuels. Where biodiesel is a net energy source, as I suggested earlier, is at the local level, particularly when produced from waste oil.

Peak Oil and the World Economy

Here is an excellent interview with Robert Hirsch (author of the seminal Hirsch Report) on the impact of peak oil on the world economy.

Peak Oil and Transport Planning

Also see my piece in today's Online Opinion.

Richard:  Stuart, would you mind if we publish it on Webdiary as well? 

Peak Oil and the Airline Industry

Roger Bezdek, co-author of the seminal Hirsch Report, gave a presentation on 'Aviation After Peak Oil' at last week's ASPO-USA World Oil Conference. He assesses that the implications for the airline industry are:

  • Impact of peak oil on all aspects of aviation industry will be severe due to GDP impacts
  • Aviation will be transformed from a rapidly growing industry to one in decline
  • Chaos likely throughout industry
  • Chronic, continuing excess capacity in all aviation sectors
  • $100s of billions of investments will be “stranded”
  • Some airlines will disappear or may have to be rescued by governments
  • Airport and aviation infrastructure projects will be cancelled
  • Bonds for airports, airport industrial parks, infrastructure projects etc. will likely default, cascading throughout financial sector
  • Pressure will mount for re-regulation of aviation
  • However, problems will cascade well beyond aviation sector ...

Ian Macdougall - T

Ian MacDougall: Is our phone out of order or something? Been trying to ring you since yesterday. T.


Stuart, why do we search for cures of illness?  Why map the genome?  Why not a War On Energy Shortage in the name of saving the earth from ecological transformation?  Tell you why.. these rip-off merchants can;t make a buck out of it.

I once put a similar fusion question to our Opposition Energy spokesman, in the presence of the Advertiser's editor-at-large.  The answer was that "you have to deal with the technology available at the time."  I can't help thinking that most problems that get solved do so with something that had not been previously invented. We should get cracking.

In the meantime, uranium fission's a band-aid.  Hey, thorium reactors are terrorist friendly aren't they?  We should at least be killing two birds with one stone, but again where's the profit in that?

Sorry, I'm ranting tonight I know.. I just get so #$&XX@ with it all sometimes!

Alan Kohler on the Discovery vs Production/Demand Gap

See tonight's Kohler Report on ABC News for a brief description of the historical oil discovery vs production/demand gap mentioned in my earlier post.

Jathropa or Tuba Tuba

From Wikipedia;
The hardy jatropha is resistant to drought and pests, and produces seeds containing up to 40% oil. When the seeds are crushed and processed, the resulting oil can be used in a standard diesel engine, while the residue can also be processed into biomass to power electricity plants.


The plant can grow in wastelands, fertilises the soil that it grows in, and yields more than four times as much fuel per hectare as soybean; more than ten times that of corn. A hectare of jatropha produces 1,892 liters of fuel (about 6.5 barrels per acre).

Jatropha can also be intercropped with other cash crops such as coffee, sugar, fruits and vegetables.

How about a few Webdiarists throw a few dollars together and plant a few hundred acres?  Anyone know of any underutilised land?

The Chinese seem pretty serious about jathropa.

The Chinese are aiming at doing something tremendous. This month, the Chinese government revealed plans to put up a 13-million hectare jathropa plantation, capable of producing over 6 million liters of biodiesel per year! According to the State Forest Administration, this plan is in recognition of the viability of biofuels and the need for a diversified energy base for Chinese transport. On top of the biodiesel produced from the nut of this particular tree, wood from the plantation will also be used to generate power as fuel for a 12 MW power plant facility also being designed within the plantation area.

The Australian government accuses China of dragging the chain on renewable energy, its seems they are way out in front of us.

Australia wants a looser scheme in which countries are free to act as they see fit.

It argues that the US, China and developing countries will not take on commitments forced on them by others. Europe argues that without mutually negotiated binding commitments, no worthwhile targets are set and met. Both are valid points.

Then there is the argument that gets Bush and Howard steamed up. Half the world's emissions are now from developing countries, they argue, and up to 90 per cent of emissions growth by 2050 will be in countries that were set no targets under the Kyoto protocol.

Unless they take on commitments in future, the US argues, a post-Kyoto agreement will have little effect on emissions growth and will just shift industries from countries with targets to those without.

But China's President Hu Jintao argues that global warming results from the build-up of 200 years of greenhouse emissions, overwhelmingly from the West. On a per capita basis, China's emissions are small compared with those of Australia or the US. China says it is taking action to slow its emissions growth, but targets should be only for countries with high per capita emissions.


Tuba Tuba

I don't know the economics of this plant.

One of the problems with this kind of scheme is a new kind of cash cropping - land for food being replaced with land devoted to fuel.

It may be viable - if the land wasn't useful for agriculture.  I don't know enough to say.

Tuba Tuba can be planted alongside food crops

Hi Evan,  that's one of the great things about it, although it's not necessary;

“This plant will save humanity, I tell you.”

From a New York Times article quoting the Wall Street Journal 

With oil trading at roughly $70 a barrel, this lowly forest plant is suddenly an unlikely star on the world’s alternative-energy stage. The seeds from jatropha’s golf-ball-size fruit contain a yellowish liquid similar to palm oil that can be made into biodiesel … But unlike other biodiesel crops, jatropha can be grown almost anywhere — including deserts, trash dumps, and rock piles. It doesn’t need much water or fertilizer, and it isn’t edible. That means environmentalists and policy makers don’t have to worry about whether jatropha diverts resources away from crops that could be used to feed people.

Fusion doesn't exist

Richard, fusion is like 'clean-coal' - non-existent.

Richard:  But, like clean coal, achievable with investment? 

The Folly of Fossil Fuels

Richard, in both cases you're gambling everything not just on 'technology' per se, but on scientific discoveries that are yet to be made. 'Investment' can make technology from existing science, but it doesn't make new science.

In the case of so-called 'clean-coal', even if you have the technology, there is a huge risk of acidifying the oceans and/or poisoning the aquifers of the driest continent on earth depending on where you choose to attempt to bury the CO2, which, by the way, is measured in cubic kilometres per day to give you an idea of the volumes we're talking about. Also, there is an enormous energy loss involved in whatever CCS process is used.

But the real tragedy is that we don't need either. Australian scientists and engineers lead the world in solar energy (both solar PV and solar thermal). We train them and they head for China, the US and even the Middle East (yes, even the Arabs are building solar power stations, but not here in the 'Smart State'/'Sunshine State') where they can put their training to good use. Solar PV can provide distributed energy at homes and businesses, and, despite Howard propaganda, solar thermal can provide base-load power.

Unlike so-called 'clean-coal', which will probably never exist, solar thermal power stations exist today, and could be built across the country, tomorrow, with existing technology. Indeed we could probably retro-fit coal-fired power stations as solar-thermal power stations if we had to.

So why don't we do this? The federal government (and the ALP for that matter) has been totally corrupted by the greenhouse mafia (See Four Corners and Clive Hamilton's Scorcher). And all this for the sake of 1.7 percent of the workforce in the mining sector, jobs which could be replaced by better paid, higher skilled jobs in a solar energy and manufacturing industry if ever it was allowed to flourish; and we could export technology rather than importing oil. Even Germany, with considerably less sunlight than us, already employs something like 50,000 people in the solar energy industry. This is a national disgrace.

The so-called resources boom won't save us either; indeed, our reliance on digging up dirt and loading it on ships at the expense of everything else will probably push us over the precipice. Consider the following:

  • Based on the current Geoscience Australia (GA) domestic oil production forecast and a projection of rising oil demand, we will be importing 80% of our oil by 2015.
  • Our current petroleum trade deficit is $8 billion per annum, 2/3 of the total trade deficit.
  • Based on the above GA forecast and assuming US$50 per barrel, the CEO of the Australian Petroleum Production and Exporter's Association recently estimated that the petroleum trade deficit would increase to $27 billion by 2015.
  • Given that oil is already approaching US$90 and rising, a more realistic figure lies somewhere in the range of $40-80 billion, i.e. 5-10% of current GDP or two to four times the current value of our coal exports.
  • The McNamara Report notes that the coal mining industry is vulnerable to rising oil prices. A typical coal mining operation uses 7.6 litres of diesel per tonne of production. Coal is currently being sold at record high prices of about $70 per tonne. The current rolling average wholesale diesel price is about 65c per litre. Fuel costs alone therefore currently represents about a 7% overhead.
  • High coal prices are based on high demand from rapidly developing economies such as China and India, which in turn rely on demand for consumer goods from the rising middle class in those countries. Much of this in turn assumes affordable fuel and other oil dependent commodities. For example there are about 13,000 new cars on China's roads each day. When they can't afford to drive their cars as oil prices increase, demand for our coal will decrease and therefore so will prices.
  • A doubling of fuel prices and a halving of coal prices will see coal mining fuel overheads increase to 28% even if you ignore all other economic factors. This would see a large part of the coal mining industry collapse, as would our export income from coal.
  • When you put some of these figures together, our petroleum trade deficit alone could cripple the economy within the next five or six years, even before you consider the impact of rising oil prices on the air (airliners can only run on jet fuel) and road (I've never even heard of a hybrid truck) transport sectors, tourism, retail and what's left of manufacturing.

So, even if you ignore climate change, unless we take urgent steps to move on from our fossil fuel dependence we will be staring down the barrel of economic collapse within the next decade. History will take a dim view of this generation's apathy if we allow this to happen.


Bill, my apologies I did have a guess at what it costs us for fuel, and it's 2.8c a litre not 2c. Our fuel is mainly filtered used vegetable oil and we make biodiesel to start the engines it until the oil warms up, when you combine the cost of the biodiesel and how much you use per litre of oil, it comes to 2.8c per litre. As we have a few acres, its not hard to get 500 + litre's an acre, using the right seed oil crop and rotating seasonally. The country's bush could provide a great deal of seed oil from the huge amount of seed dropped from both Eucalyptus and wattles, they already have machines which harvest many varieties of trees without harming them. Our ute has a range of over 3000 kms which drops the cost even more. Aquaculture which gives you both vegetables, berries and some fruits, also gives you eating fish at a very low cost and you can have small ones in flats. If we don't take the strain off the ecology and environment of this planet, using sensible cost effective methods, our outcome may be more than we bargained for. If the rate of extinctions continues to accelerate at the pace it is, we may not be able to survive when conditions and the biodiversity of the planet disappears, as their food supply below them disappears.

In my post above, I wasn't referring to all people living in urban situations as clones, it just appears that a lot of them act that way when it comes to the important things for our future. Then again when I think about it, there's probably just as many clones in the bush who are still trying to cling to a dying way of life and refuse to change. It may be to late for any who haven't prepared their farms or businesses already for the coming changes associated with climate change and rapidly unaffordable fuel and energy. Coal needs lots of fuel to extract and move transport as does every industry, as they've stagnated sustainable transport infrastructure and massively spent on short term road transport,  I don't care who gets in, as long as they do something that will make a difference and not just another book full of broken promises and ongoing destruction of what supports our lives.  As the say, you can have an environment without an economy, but you can't have an economy without an environment. Seems pretty logical to me.

Fuel @ 2c/L

Alga, if you can tell us how to make fuel for two cents per litre, all our troubles are over, and you'll soon be richer than Bill Gates — which makes me wonder what you're doing wasting your time here. But hey, you're not talking about those engines that run on hot air, are you, by any chance?

Peak sustainability has already passed

I wonder how long it will be before people awake from their deluded dreams to realise that neither the lib/lab coalition, nor any of the current parties have any viable plans for the future, just more of the same. I understand the faith ideologists have in their preferred failed factions, but anyone with half a brain can see it's too late. To change direction now would still take many years before workable changes came into effect. Having more fuel efficient cars is stupid in the extreme: we need vehicles which don't use fossil oils at all. We have alternatives which can cope with the situation if approached right, but as we all know it's the vested ideological and corporate interests which control political parties and their directions, not the electors. My fuel costs me about 2 cents a litre and it's simple to achieve. Even city dwellers can reduce their consumption and reduce both fuel and food bills with a little effort. But I know all city and urbanised people really want is to be provided for and not have to be responsible for their own existence. That's why it's easy for the current nut cases in politics to get in, they prey on the blind apathy of the sociological and ideological urban clones.

If you rely on the politicians to do anything rational, you are just waiting for the end. Having complete fools in power results in foolish outcomes and the current crop of politicians and bureaucrats have to be most unintelligent bunch of programmed corporate clones I've ever seen. For those living outside cities, a good backup is to buy a couple of horses and have a cart built now (pity there's no water for feed, though). For those living within the cities, your days of living in gluttony and ease at the expense of the rural sector's hard work are over. Better ask your god for help, as it's certainly not coming from those you are prepared to hand your life responsibilities to and put blind faith in.

He Who Dares Wins

I would suggest the current high prices are due to a number of factors and peak oil isn't one of them.

Theories regarding peak oil are as pointless as arguing religion, one either believes them or one does not. My simple question to those asserting oil will be $350 a barrel in the not to distant future: Have you people found yourselves a broker yet?


Oil Prices and Peak Oil 'Theory'

Paul, you're right that current prices have little or nothing to do with peak oil. The traders that currently determine the price are either ignorant of, or reject, peak oil. Indeed they rarely look beyond tomorrow's news, the borders of their own country, or the sheep sitting at the computer terminal next to them. One point that I will make though is that at current prices, considering its value in terms of energy/work rather than its cost, oil is cheap. You know this is the case when the water in the fridge at the service station is cheaper than the petrol you put in your car.

Peak oil is not a 'theory'. It is an observed phenomenon, ie a scientific fact. Consider the following facts:

  • Oil is a finite resource.
  • About 60 of the world's oil producing countries have already passed peak oil production (including the US in 1970 and Australia in 2000).
  • Before you extract oil you need to find it. The peak rate of discovery occured in the mid-1960s.
  • Since the mid-1980s the consumption rate has exceeded the discovery rate.
  • The world is currently consuming oil at five times the discovery rate.
  • The world conventional crude oil production rate has been flat (even declining steadily) for the last two years.
  • World reserves additions from new discoveries, enhanced oil recovery and non-conventional oil are at best flat.

Which of the above facts do you dispute? The only legitimate question now is exactly when the world peak will occur. Even the International Energy Agency recently warned of an oil supply 'crunch' by 2012.

Sydney Airport

Sydney Airport has just announced that they plan an up-grade to cope with the increase in visitor numbers over the next fifteen years.  Especially to cope with the new super-jumbos: they didn't mention what fuel the damn things would be using.

Sydney Airport

Evan Hadkins, What ever happened to the "No Aircraft Noise" Party? They always used to raise their head at election time, especially supporting the Labor policy of "a second airport for Sydney".

As for the fuel, perhaps we could get Qantas to use gliders instead of the new Airbus.

Please Explain

Alan, re Sydney Airport. That's all too cryptic for me. What are you trying to say?

Sydney Airport

Roger Fedyk, it's alright. I have found out: they were deregistered in 1999 because they had fewer than 500 members.

Airport Expansions and Other Absurdities

Evan, you might be interested to read my recent submission to Brisbane Airport Corporation regarding their New Parallel Runway project. This basically amounts to a $1 billion gamble on the price of oil remaining at US$55 a barrel in 2030, even though it's already trading at US$85. 'Absurd' doesn't even begin to describe this proposal.

If you haven't already done so, you should approach your superannuation fund to raise your concerns - that's where most of the money ultimately comes from for these projects, not to mention motorways and coal-fired power stations. The developers and company directors rely on the apathy of people like you and me to get away with using our money in this fashion. My advice if you are genuinely concerned is not to be apathetic.

Thanks Stuart

I've downloaded it and shall read it in the next day or three.

Awful but…

Evan, it's difficult to disagree with you, but not everyone lives in a city. Not everyone lives within walking distance of a public transport terminal, decent or otherwise.

The fact that cars are getting more awful as the crisis looms — I mean larger and heavier and hungrier for fuel, seems strange. And of all things taller! What the hell's that all about? If the trend continues they'll soon be as high and unwieldy as American cars were in the 1930s.

Looks to me like the energy addicts are in some kind of final death throes as inevitable disaster catches up with us all.

Awful But...

The cars get higher because injury is related to angle of impact.  You're better off if you are higher up and the hit isn't coming down on you.

My picture of the future car is a tank with cameras to navigate by.

I wanted to raise exactly the point you do Bill, that most of us don't live in pedestrian friendly places - and that we should switch our attention to providing this instead of (like NSW and Queensland state and local governments) providing more roads for wretched cars.

That is: I think we are in close to complete agreement.




I think cars are awful.  I hope the lack of petrol means they disappear.

Bring on walkable cities and suburbs and decent public transport!

Where is Howard as oil reach record high?

US crude jumped $US2.44 to $US86.13 a barrel in its fifth straight session of gains, after hitting an all-time peak of $86.22. London Brent crude rose $2.24 to $82.79.

Citigroup analysts say a run at $US90 is now seen as reasonable.

Oil is pushing up to at least $U100 a barrel. We need to develop a fuel efficient car in Australia.

The Green Car Innovation Fund would aim to generate $2 billion worth of investment to manufacture low emission vehicles in Australia, Mr Rudd said.

He said Labor would introduce the fund over a five-year period from 2011 if it won this year's election.

Under the initiative, the automotive industry would be asked to match a $500 million government contribution on a one-to-three basis.

With the oil price about to reach the $U100 mark, the promise by Labor to generate $2billion worth of investment to manufacture a low emission care in Australia is a step in the right direction.

It is a disgrace that Australia has not developed hybrid technology. I recently went on a driving holiday around Brisbane and Hervey Bay, I caught the Tilt Train from Cairns to Brisbane, hired a Toyota Prius in Brisbane. We drove up to Hervey Bay, the car was great (after I figured out how to get it going). The Prius averaged about 85 miles per gallon in the old money or 4.9L per 100km. The fuel saving almost paid for the cost of hiring the vehicle.  We could save a fortune in fuel costs and help reduce our GHG emissions.

Too Little, Too Late

Hi John, sorry to rain on your parade, but the Green Car Innovation Fund amounts to fiddling while Rome burns. The phase-out of leaded petrol from Australia's car fleet took 15 years even though this was a very simple fix (catalytic converters and different valves fitted to new cars) in a buoyant economy.

Even US$100 oil will soon be considered cheap. In 2005 the investment bank IXIS CIB predicted that oil prices could reach US$380 by 2015. By that year Australia will be importing about 80% of its oil. The petroleum trade deficit, already $8 billion and 2/3 of the entire trade deficit, will blow out to something like $60-80 billion or 10% of current GDP (optimistically assuming GDP doesn't slide in a recession). Only the genuinely wealthy will be able to afford to drive a Prius by then, even at 4.9L per 100km.

The problem is no longer about preserving "happy motoring utopia"; it's about preventing economic collapse. Even just from a transport perspective, the sort of urgent things we need to see are:

  • Stop wasting tens of billions of dollars on new roads that many people won't be able to afford to use even by the time they are completed.
  • Fast passenger rail connecting the capitals (the airline industry isn't sustainable beyond US$100 oil according to Qantas).
  • Massive investment in public transport from both state and federal governments (the feds are pork-barreling marginal electorates with new motorways in areas that have no public transport, and don't fund public transport).
  • Massive investment in freight rail to get affordable food onto our tables in the cities (much of the rail network has either been neglected or in some cases even dismantled).

And that's before you look closely at any of the other sectors of the economy that will be hard hit by peak oil. Without a sense of urgency, hundreds of thousands of people could be out of work within a few short years.

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