The Finch Formerly Known As Gold

15 October 2004

The post-oil economy

If you're an alternative-fuels kind of person, you should be thrilled at $53 oil, says Rammer:

The recent boom in oil prices that has slowed economic recovery somewhat is exactly the best possible thing to both reduce dependence on Middle-Eastern oil and provide the US with alternative sources of energy. The key to the transformation is that with the oil price roughly double its historical level, many other sources of energy become economically competitive. Over time companies and people at large will convert from high-priced oil to other sources and once that infrastructure is built, it will be cheaper to keep it running than to switch back to oil.

OG&E reports that after one year of operation, 3,000 customers are buying 100 percent of their electricity from a wind farm, and 6,000 others are buying a fraction thereof. (Disclosure: I committed to buying 7200 kwh a year; through early October I have used 5600 kwh, which puts me pretty close to the 100-percent mark for the full twelve months.)

Other methods aren't quite so close to competitiveness yet, but:

[S]uffice to say, as you pay twice what you expect to fill your car's tank, realize that you are on the tail end of the oil economy. Don't expect that the replacement for oil will be much cheaper, but it seems clear that it won't be much more expensive than oil is now.

The world moves on, irrespective of cartels or of campaign promises.

Posted at 9:31 PM to Family Joules

An additional benefit is that most of those alternative energy sources are less polluting than oil. (Coal is a tough one to deal with.)

What I wonder is if we could control ourselves if/when nuclear fusion becomes the fast food of our energy diet.

Posted by: Mike at 1:17 AM on 16 October 2004

The trend is toward lower consumption, by our vehicles, by our appliances, by our residences: I don't see that trend changing unless the price drops to zero.

Posted by: CGHill at 9:05 AM on 16 October 2004

I don't see the same trend. While I agree that appliances tend to be more energy efficient, there are many more of them. Folks now use electricity to brush their teeth.

And the national trend in vehicle energy consumption hit a hiccup:
Total annual fuel consumption was 140.5 billion gallons or an average of 705 gallons per vehicle. This is a decrease since 1970, when the average annual fuel consumption per vehicle was 830 gallons; but it is an increase since 1990, when the average annual fuel consumption per vehicle was 677 gallons.
I don't know about sales numbers, but I get the feeling consumers like the increased horsepower automakers are offering in bigger engines.

And then there's this:
The International Energy Outlook 2004 (IEO2004) projects strong growth for worldwide energy demand over the 24-year projection period from 2001 to 2025. Total world consumption of marketed energy is expected to expand by 54 percent, from 404 quadrillion British thermal units (Btu) in 2001 to 623 quadrillion Btu in 2025.

Posted by: Mike at 10:38 AM on 16 October 2004

Worldwide trends are indeed up; I was thinking on the national, not global, scale.

I figure the Sonicare, which costs me maybe 75 cents a year to run, saves me one trip to the dentist (at $90 plus $1.05 worth of gas) per year. (Of course, it cost $80 to buy, and $16 for a pair of replacement brushes every year, but at the three-year mark I'm ahead of the game.)

And the sound of SUVs sucking gas is diminishing somewhat as newer, less-inefficient models debut and persons aggrieved by gas prices reluctantly look elsewhere for their transpo-boxes; meanwhile, hybrids are on the rise and diesels are poised for a comeback. (DaimlerChrysler sells a turbodiesel van that's tall enough to stand up in, that holds up to 15 passengers, and that returns 25 to 30 mpg.)

Besides, your C6 Corvette with the 400-hp LS2 engine gets 19 mpg (28 on the highway). The enemy isn't horsepower; it's weight.

Posted by: CGHill at 10:58 AM on 16 October 2004

And as any idiot ought to be able to figure out, for heavier vehicles more horsepower is more fuel-efficient and less polluting.

On the other hand, no matter how fuel-efficient or clean you make vehicles these days, they're going to waste a lot more fuel and pollute the air a lot more in gridlocked traffic on roads that aren't keeping up with growth -- that is, aren't allowed to keep up with growth, thanks to greenies' lawsuits.

Makes you wonder if the greenies really do want better fuel efficiency and less pollution...

Posted by: McGehee at 12:50 PM on 16 October 2004

I had a nice discussion with a sweet lady of the blue-state persuasion at Full Circle (bookstore and alleged nexus of Oklahoma City liberalism) today regarding the OG&E wind-power scheme, which we were both happy to use, she because it reduced those awful greenhouse gases, I (playing the role of the Evil Right-Winger, and that's the way I phrased it, I think) because it was on the way to becoming cheaper than natural gas, which OG&E uses for most of its other power plants. (This was before your comment, so I didn't ask her for her position on new roads.) I think she was perhaps slightly surprised that the program would get a conservative-sounding endorsement, and I donated all my free-book points for the day to a books-for-poor-kids program, which perhaps burnished my image ever so slightly. :)

Posted by: CGHill at 10:15 PM on 16 October 2004

and did you then parlay that burnished image into a phone number? there is no way that she could resist your suave conversational skills.

btw my little town in Ohio has just doubled the size of its municipal windmill farm to 4, and is about to add another 24 next year. this alternative energy thing is no joke.

Posted by: rammer at 9:49 PM on 18 October 2004

Well, no, but I know where to find her. :)

The Woodward wind farm is owned by FPL Energy, a Florida concern; OG&E buys the output of its 34 turbines. Still, this is only a bit over 50 megawatts; it will take a lot more than that to serve all of OG&E's 730,000 customers.

Posted by: CGHill at 9:05 AM on 19 October 2004