‘Peak oil’ is dead – but the need for urgency is greater than ever

Opinion
By Jos Dings - T&E Director


The most recent World Energy Outlook from the International Energy Agency caught more headlines than usual, the main reason being its finding that North America is to become self-sufficient in energy in 20 years due to an expected increase in production of unconventional oil and gas, as well as energy conservation – mainly more efficient cars. This has some serious consequences, also for Europe, and it heightens the responsibility of the world’s politicians to take some meaningful action on climate change, and quickly.

There’s little point speculating whether the IEA’s prediction is likely to be true, if only because we won’t know until 2030. But it’s clear that a huge energy transformation is going on in North America.

The starting situation is already a very difficult one. North Americans guzzle much more fossil fuel than Europe does, in transport roughly three times more per head. When energy dependence arguments disappear from the USA’s energy debate, when the interests of oil and gas producers weigh ever more heavily on the political agenda (and contribute even more to election campaigns), it takes an awful lot of optimism to expect a more constructive US attitude on climate change. I don’t know how many more ‘Sandys’ it will take to silence climate deniers in USA, but the answer is likely to be: far too many.

It is high time to ditch any notion that ‘peak oil’ will come to the rescue – that somehow geological constraints will end our addiction to fossil fuels. At the very least it’s time to be much more precise and replace the term ‘peak oil’ with ‘peak conventional oil’ (somehow I don’t feel this slogan will catch on!). Regular oil from normal fields is indeed running out, but at prices of $100/barrel, it becomes attractive to make oil in ways we never thought feasible 15 years ago, and unfortunately the technologies to do so become ever better and cheaper. This brings me to another point.

We have thought for too long that high oil prices are a good thing because they spur investment in energy efficiency and cleaner alternatives. Of course that is true, but it is only half the truth. We – and certainly the ‘peak oilers’ – overlooked for too long the fact that they also spur investment into ever weirder, riskier and higher-carbon ways to produce oil – tar sands, tight oil, oil shale, deep sea, maybe even oil shale or ‘coal-to-liquid’. We need to leave two thirds of known fossil fuel reserves in the ground to avoid catastrophic climate change. That is the key challenge, and an enormous one.

The supremely counterintuitive aspect here is that successful climate policies will send global oil prices plunging. If climate policy is successful, we use so little oil that it becomes very cheap, so cheap that oil producers decide it is best to leave the oil where it is and belongs: in the ground. The conundrum is that fossil fuel has to be expensive for consumers, so they use it sparingly and look for alternatives, but cheap for producers, so they leave it in the ground. This is arguably the greatest challenge for global climate policy to solve, and, perhaps unsurprisingly, it points to carbon taxes as a key element, if not the solution.

So if peak oil and limited fossil fuel supply are not going to provide a guarantee against planetary overheating , what or who will? The answer may not be terribly original but it is the world’s politicians, because we need them to define, agree and implement the radical changes required.

This is why we really need a renewed effort to inject urgency in the climate debate now. President Obama’s re-election is a (small) glimmer of hope. He has not promised immediate action, but he has promised to start paying attention again, after having studiously ignored it on the campaign trail. NGOs need to spend more time again on basic (re-)education, exposing the sceptics, deniers and naysayers for what they are, continuing to advocate progressive solutions, and being prepared to think big. And Europe must be prepared to be more assertive in charting its own course and pursuing its own interests, and not look to the US for approval all the time – concrete examples are the insistence on aviation staying in the EU Emissions Trading System if Icao can’t agree on a global deal, and on assigning a high-carbon label to tar sands in Europe’s fuel quality directive.

As one of our most senior campaigners puts it, ‘the question is not whether we will win, but when and how’. That’s the spirit! The only snag: the ‘when’ question matters a great deal when we talk climate change.