We won't "run out", but we could well have shortages. Here's why...
First, it's important to understand the overall picture. The UK had been a gas exporter from the mid-nineties until a few years ago, but now production from the North Sea has been plummeting for over five years, we're a significant importer. The graph below illustrates this - when the blue line is above the yellow, we were a net exporter, when it is below, we were a net importer. Click it for a larger version.
Gas supply in the UK comes from several sources at present:
Each of these sources of gas has key strengths and weaknesses, such as:
Current state of UK gas storage
You can view the current amount of gas in storage, and various other bits of technical info, on a website run by the National Grid. Click the help link on that page for more info.
However, what's more interesting is to be able to look at the levels of gas storage this winter so far, and compare them to a year ago. It's quite a bit of work to get the data for this and make some charts, so I've done it for you. The following charts show long, medium and short range storage levels from October through to September, with the red line representing this winter, and the blue line winter 2009-10. Again, click for larger versions.
There are several things to note from these graphs:
At present (late December 2010), gas storage is about 52% full, while a year ago it was about 85% full. If the remainder of the 2010-11 winter remains cold, or even just colder than average, then gas storage could well be completely depleted before winter ends.
If withdrawals from storage continue at the average rate for December 2010 so far, there are only 45 days of stocks remaining.
So what will happen when stocks get low?
Supply to domestic customers will be guaranteed if at all possible, as the industry and government can not afford to have many thousands of people without heating in the winter, not to mention the technical difficulties with shutting off large areas of the gas network. The procedure that is followed is detailed on government and National Grid websites, such as this presentation.
The stages are:
Let's hope it doesn't come to that. But be aware that the risk grows as long as the weather stays cold, and that any accident or malfunction in gas supplies could tip the system over the edge quite quickly, especially later in the winter.
One final point - about 40% of our electricity in the UK is generated by burning gas, and these power stations could have their supply cut in an emergency. While other sources, such as coal and oil fired stations would be brought to maximum output, there could still be a shortfall, so a gas supply emergency implies an electricity shortage as well.
Here are links to where I got the data from for the charts above, and where you can read more:
I'll probably do an update in a few weeks, when the effect of the weather has become clearer. In the meantime, consider what you might do in a gas supply emergency, and make appropriate preparations.
Friday, 24 December 2010
We won't "run out", but we could well have shortages. Here's why...
Sunday, 19 December 2010
I just blogged on this for the Ashden Awards. I've been expecting an alert from the National Grid for some weeks, and now it's here. I expect some more alerts this winter, and if it stays cold we could be in for some real problems...
Thursday, 18 November 2010
The UK-based Peak Oil Taskforce, which includes Virgin, Arup, B&Q, Kingfisher, Solarcentury, Buro Happold, Scottish and Southren and Stagecoach, has just published a briefing note on what the BP oil spill at the Macondo well means for global oil production and for the UK.
The output of this well would have been minuscule compared to global oil demand, despite the havoc it wreaked in the Gulf of Mexico. However, the knock-on effect is that the increased regulation and safety procedures for deep-water oil production will slow down development of future deep-water oil fields. These changes are clearly needed to improve safety, but an unintended result is that oil supplies will not grow as much as previously forecast in the coming years. The report sums it up:
The Taskforce sees very major consequences of rising oil prices in the next few years. Without a strong and coordinated response from Government to protect the UK economy and society from rising prices, we will see the cost of travel, food, heating and retail goods rise which will impact British businesses and citizens alike. We also need to see much quicker action from Government to support the introduction of renewable energy technology and energy efficiency measures.Mike
The Taskforce would like to work with the Government to develop a contingency plan that both addresses the risks of Peak Oil and speeds up our transition to a low-carbon economy.
Friday, 12 November 2010
This week the IEA published its World Energy Outlook for 2010. The most interesting sentence is probably “Crude oil output reaches an undulating plateau of around 68-69 mb/d, by 2020, but never regains its all-time peak of 70mb/d reached in 2006.” So, they're basically admitting that peak oil has come and gone, at least for conventional oil.
Of course, there is still growing supply from unconventional sources, but the net energy, or EROEI, of these sources is lower, so it won't be long before we pass the peak of all energy supplies, if we haven't already.
You can read some critical analysis of the WEO2010 at The Oil Drum and ODAC.
Saturday, 23 October 2010
According to a story in the Telegraph, the Italian oil company Eni has been given permission to develop a gas storage facility in the North Sea. At about 4.6 billion cubic metres, it will roughly double the UK's gas storage capacity.
This is exactly the kind of thing we need as the North Sea gas output continues to plummet year after year, but it's worth bearing in mind that:
- Eni might not be in a hurry to develop it, given the economic situation.
- If it goes ahead, it still won't be ready until 2015, by which time our indigenous gas production will have fallen another 20% or so.
- If it goes ahead, we still have to import the gas, which assumes that there is enough available in the market, and that we can afford it.
- If it goes ahead, it will still only give us 20 days supply of peak winter demand.
Friday, 24 September 2010
The Telegraph reports:
Energy secretary Chris Huhne has ordered his officials to look at the impact of a 1970s-style oil price spike on the British economy. Mr Huhne said the UK was having to prepare itself for “lots of shocks”, forcing the price of a barrel of oil to double, mirroring the volatility last seen in the 1970s.Could it be that the UK government has finally woken up and realised there's a problem with oil supply?
A 1970s-style doubling in the price of oil would drain £45billion from the UK economy in two years, hitting investment and jobs. He told a meeting on the fringe of the party’s conference in Liverpool: “We will have a world where there may be lots of shocks, we may well have oil price rises which are similar to the ones that we had in the 1970s, a doubling. I have asked for some work to be done in the department about what the impact of that might be in terms of British business, businesses that have nothing to do with energy, with green growth, entirely outside."
Friday, 17 September 2010
An interesting article over on Project Syndicate, here's a few paragraphs:
In forecasts that carry forward to the 2030’s, the three organizations [IEA, EIA and OPEC] share the view that world energy demand will increase, that developing countries will account for most of the increase, and that fossil fuel will remain dominant. They also agree that dependence on oil from OPEC members will increase as non-OPEC oil resources dwindle and become more expensive to extract. But a major flaw in modeling world oil markets makes these forecasts as unrealistic as a projection that humans will land on Mars tomorrow.Mike
It is nearly impossible for OPEC members to produce the difference between estimated world demand and non-OPEC supply. For example, in its recent forecast, the EIA’s base-case scenario is that, by 2035, OPEC will add about 11 million barrels of oil a day (mb/d) to its 2010 output. Is this possible when production is declining at a rate of at least 3%?
Indeed, given the expected growth in energy demand in the next two decades, and the possible – even likely – shortfall in OPEC supply relative to the projected “call on OPEC,” the term “alternative energy” will lose its meaning. The only “alternative” to harnessing all feasible energy sources will be a slow-growth world of permanent shortages and increasing misery.
Friday, 3 September 2010
Well, that's the argument from Dmitry Orlov. You need to read the whole article, but this short quote sums it up:
When faced with insufficient domestic oil production, an industrialized country has but two choices:Needless to say, it's at the "doomer" end of the spectrum, but it's difficult to argue with the points made, sadly...
1. Import oil
But when faced with insufficient global oil production, an industrialized planet has just one choice: Choice Number 2.
A German military think tank has produced a report on Peak Oil, and it's been leaked. Der Spiegel has a report on it (in German and English), and the report can be download in German from here.
If, like me, you can't read German, there's an excellent summary on Robert Rapier's blog here. A few quotes from the summary on his blog:
In the past, resources have always triggered conflicts, mostly of regional nature. For the future, the authors expect this to become a global problem, as scarcity (mainly of crude oil) will affect everybody.The financial risk is not ignored either:
Higher cost in commercial transportation markets might severely affect current supply chains, and no alternatives are in sight (electric trucks don’t exist yet). Particularly food might become a critical issue for countries that are a) highly dependent on imports and b) are susceptible to price-increases of food products, particularly affecting Africa, parts of Asia and Latin America, and the Middle East.
Overall, more expensive transportation and increasing problems “at home” might reduce the ability of larger countries to intervene internationally (politically and/or with military action), and also lower the readiness to provide help to poorer countries. The focus will be more on a country’s egotistic (energy) interest and not so much on an ideal of transferring Western values. The gap will likely not be filled by NGOs, as they will be affected by similar limits.
In addition to the gradual risks, there might be risks of non-linear events, where a reduction of economic output based on Peak Oil might affect market-driven economies in a way that they stop functioning altogether, leaving the range of a relatively steady downward trajectory.Well worth reading!
Such a scenario could pan out by an initially slow decline of trade and economic activity, combined with higher stress on government budgets from lower tax income, higher social cost and growing investment into alternative technologies.
Investment will decline and debt service will be challenged, leading to a crash in financial markets, accompanied by a loss of trust into currencies and a break-up of value and supply chains – because trade is no longer possible. This would in turn lead to the collapse of economies, mass unemployment, government defaults and infrastructure breakdowns, ultimately followed by famines and total system collapse.
Thursday, 2 September 2010
It's been a remarkably quiet 2010 hurricane season for oil production in the Gulf of Mexico so far, which is especially good considering that the BP oil well leak was being worked on through the first month or two of it.
However, the season doesn't finish until the end of November... You can keep an eye on the latest developments on this page from the NHC, which displays an image like this:
If you visit the page itself, you can click on the hurricanes and storms to get more details on their predicted tracks.
Monday, 23 August 2010
Well, that's the way it looks to me, after reading a story brought to my attention by James from PowerSwitch:
Speculation that government ministers are far more concerned about a future supply crunch than they have admitted has been fuelled by the revelation that they are canvassing views from industry and the scientific community about "peak oil".The article, from The Guardian, goes on to remind us that the IEA, which the government regards as the ultimate authority in energy supplies, is itself split over peak oil, with insiders saying that the official projections of oil supply will be impossible to achieve.
The Department of Energy and Climate Change (DECC) is also refusing to hand over policy documents about "peak oil" – the point at which oil production reaches its maximum and then declines – under the Freedom of Information (FoI) Act, despite releasing others in which it admits "secrecy around the topic is probably not good".
Experts say they have received a letter from David Mackay, chief scientific adviser to the DECC, asking for information and advice on peak oil amid a growing campaign from industrialists such as Sir Richard Branson for the government to put contingency plans in place to deal with any future crisis.
But in response to Freedom of Information requests, the government is saying that the need for ministers to have private discussions on sensitive issues is more important than telling us what the government knows, and what it plans to do about it.
My suspicion is that the government has no idea what to do. The impact of peak oil and the measures that will be required to deal with it will immediately lose any government an election, or perhaps even a vote of confidence. Quite how we'll get out of this situation I don't know. The only thing that's certain is that the clock is ticking, and if nothing is done then the scenarios in Alex Scarrow's novels become ever more likely....
Sunday, 22 August 2010
Interesting discussion thread over on The Oil Drum, suggesting that if there's work that needs doing, and people that need work, then we should put the two together:
Over the next twenty years the US and the world will need to transition from an industrial agriculture model to one based on permaculture and more organic, labor intensive approaches to growing food. Oil is going to decline, meaning that diesel fuels to run tractors and combines will become increasingly costly. And natural gas, meaning fertilizers, will also go into decline. The era of agribusiness is coming to a close sooner than anybody might have imagined. And we are not prepared for what follows.Go to TOD to read the whole article.
The work that should be started soon and will be labor intensive is relatively straightforward enough. We need, literally, millions of men and women reconditioning and building soils capable of sustaining permaculture and local production/delivery of food. The Green Revolution has done a great deal to degrade so much of our natural soils through the increasing use of fertilizers and pesticides as well as irrigation. Now, without these petroleum-derived inputs, it is likely that food yields would drop significantly. Some land areas currently under cultivation might even fail completely. As far as oil-based transportation is concerned, the world is going to grow very large once again, and very round, once long-distance hauling is no longer cost effective. Foods will have to be grown and consumed locally and the only alternative to industrial agriculture that might hope to produce sufficient calories and nutrients to keep huge numbers from starving is permaculture. That is where the jobs will be. And the sooner we get started developing our skills and knowledge of how to do this, the better off we will all be.
Saturday, 14 August 2010
Interesting article in the Guardian, pointing out a view I've agreed with for a long time:
"Determined action at the global level will become possible only when climate change is no longer some scientific prediction, but a reality that people feel … A world incapable of preventing climate change will have to live with it."The impact of passing the peak of global oil supply is far more immediate than climate change, and the effects are much more visible and easy to understand. The solution - using less oil (and gas and coal, as they ultimately face the same resource constraints), is also pretty common sense for most people.
What effect would a barrel price of $200 have on industrial economies, should that spike be sustained for any length of time? We would witness endemic global market disruption, reductions in agricultural yield, increased transport costs for both finished goods and raw materials (true pessimists would add an oil war or two for good measure). The shockwaves would be felt everywhere, although as ever, the poor will take the brunt of it. And yet when the price of oil shoots up, we use less – meaning we output less CO2.
Peak oil is inevitable. Something has to give, and it's consumerism. Governments know this perfectly well. What they really need is some externality, something abstract they can blame – deflecting the public wrath from the ballot box. Western governments need a villain. Oil at $200 a barrel fits the bill perfectly.
Fortunately most measures that might help us cope with peak oil will also help mitigate climate change, but the important point is that it doesn't really matter if you believe in human influence on the climate - we have to deal with peak oil anyway.
Thursday, 5 August 2010
According to the BBC:
Wheat prices have hit a 22-month high after a severe drought and ensuing wildfires in Russia devastated crops.Of course, this isn't anything to do with peak oil, but rising oil and gas prices caused upward pressure on food prices a few years ago, through rising prices of fertilisers, pesticides and diesel, and also through competition for land from biofuel crops. With droughts and heat waves in various parts of the world there's that much less slack in the food system, and further rises in oil prices over the coming year could again increase food prices.
Prices have risen 50% since late June.
Russia was the world's fourth largest wheat exporter in the 12 months to June behind the US, the EU and Canada, according to the US Department of Agriculture. And along with other former Soviet Republics such as Kazakhstan, it accounted for about 25% of the world's wheat exports last year, said Richard Feltes, senior vice president and director of commodity research at Chicago-based MF global. He added that while there was uncertainty over the volumes of crops being lost, such drastic change in production would severely cuts into global supply.
Wednesday, 4 August 2010
Now I know you'll say this is what you expect from the Guardian, but I think it's an interesting point, and one I've agreed with for many years now:
If there is one true religion in the US, it leads us to worship at the altar of technology. Christian or Jew, Muslim or atheist, we accept the doctrine of this shared faith: that technology provides the main path to improving our lives and that if it occasionally fails, even catastrophically, it will just take another technology to make it all better.As a society, we do seem to have this blind faith in science and technology. The news says "top scientists have developed/discovered/etc." as if they're the high priests of our religion. True, some new technologies appear to help the environment, using less energy and recycling resources, but we aren't selective - the overall picture is always more, faster, better. This endless growth can't continue on a finite planet, so we'd either better start mining asteroids or figure out a way to get off our technology addiction...
Friday, 30 July 2010
According to this article in the FT, EDF is selling it's UK electricity distribution networks to Cheung Kong Infrastructure, which is based in Hong Kong. Apparently the company is trying to reduce its debts.
So now some of the electricity infrastructure in the UK is not even owned within Europe, it's owned by the Far East. I expect to see more of this kind of thing. The West is generally on the way down, while China and India are on the way up.
Monday, 26 July 2010
Interesting story in the Telegraph today, with some quotes from "When Money Dies: the Nightmare of The Weimar Hyper-Inflation", such as:
Near civil war between town and country was a pervasive feature of this break-down in social order. Large mobs of half-starved and vindictive townsmen descended on villages to seize food from farmers accused of hoarding. The diary of one young woman described the scene at her cousin’s farm.
"In the cart I saw three slaughtered pigs. The cowshed was drenched in blood. One cow had been slaughtered where it stood and the meat torn from its bones. The monsters had slit the udder of the finest milch cow, so that she had to be put out of her misery immediately. In the granary, a rag soaked with petrol was still smouldering to show what these beasts had intended," she wrote.
Corruption became rampant. People were stripped of their coat and shoes at knife-point on the street. The winners were those who -- by luck or design -- had borrowed heavily from banks to buy hard assets, or industrial conglomerates that had issued debentures. There was a great transfer of wealth from saver to debtor, though the Reichstag later passed a law linking old contracts to the gold price. Creditors clawed back something.
Read the full story here.
Saturday, 17 July 2010
I've read a number of Peak Oil books over the years, but I think my favourite is still the first one I read, "The Party's Over: Oil, War and the Fate of Industrial Societies", by Richard Heinberg. A thorough and well-written book, it will give you a complete understanding of Peak Oil and the implications, while not being too dry.
Of course, The Party's Over is not as up to date these days, so another good one, this time written by a Brit rather than an American is "The Last Oil Shock", by David Strahan, who has worked for the BBC for many years on science and business programmes. I found this an excellent book, with a completely different tone, as you might expect being written by an investigative journalist type rather than an academic.
On the other hand, if you want some fiction, there's a couple of great Peak Oil novels by Alex Scarrow: "Last Light" and the sequel "Afterlight". These are admittedly at the doomer end of the spectrum of possible futures, but well worth the read if only to persuade you to make sure the world doesn't turn out this way!
The first thing to understand is that Peak Oil is not about oil supplies running out. Instead, it's about when the rate at which oil is supplied reaches an all-time high, and starts to decline. This is influenced by a range of factors including geology, the technology used to extract the oil, and above-ground factors such as natural disasters, politics and war.
At a basic level, when an oil reservoir is discovered the oil production from it increases over time at first, as more wells are drilled and more advanced technology is used to extract the oil. Eventually a peak is reached, sometimes followed by a plateau for a few years. After this an irreversible decline sets in, as the reservoir depletes, although a small amount of production may continue for many years. Within a country, oil reservoirs are discovered over time, so the production peaks are spread out, but the cumulative production will still reach a peak and then decline. The same is true for the world as a whole.
I'm not going to go any further into the background here, as I'd just be re-hashing what has been written many times before. There's some links at the end if you want to read more about the science behind it all. The important thing is that the peak is probably pretty soon, if it hasn't happened already, and that the implications are serious and demand immediate action to tackle them. These include effects on transportation, food supply, heating, electricity generation, and are compounded by the fact that all minerals reach a peak in supply at some point, including gas, coal and uranium as well.
This aim of blog is to bring the latest relevant news on Peak Oil to you, along with comment and analysis where appropriate. Hopefully this will be useful, and encourage you to find out more and take whatever action you can.
For more information:
The Oil Drum
Oil Depletion Analysis Centre