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The Challenge of Peak Oil. Peak Oil Opportunities and Challenge at the end of Cheap Petroleum. Richard Heinberg Scripps College September 18, 2006. Richard Heinberg Electric Aircraft Symposium May 23, 2007. Chevron:.

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Peak oil opportunities and challenge at the end of cheap petroleum

The Challenge of

Peak Oil

Peak OilOpportunities and Challenge at the end of Cheap Petroleum

Richard Heinberg

Scripps College

September 18, 2006

Richard Heinberg

Electric Aircraft Symposium

May 23, 2007


“Oil production is in decline in 33 of the 48 largest oil producing countries, yet energy demand is increasing around the globe as economies grow and nations develop.”

Global oil discoveries
Global Oil Discoveries

ExxonMobil 2003

Above ground factors
Above-ground factors

  • Remaining reserves located mostly in politically and geographically problematic areas (e.g., Nigeria, Iraq, ultra-deep water—not Texas or Pennsylvania!)

  • Lack of equipment (shortage of drilling rigs)

  • Lack of trained personnel

  • The latter two factors can be fixed—but not quickly!

The export quandary
The export quandary

  • Every year there are fewer exporters, more importers

  • Exporters are also consumers, so the amount available for export is production minus domestic consumption

  • With high prices, exporting countries are flush with cash, their economies are growing, domestic oil consumption is rising

  • Result: Available exports will start to shrink before peak and shrink much more rapidly than the rate of decline in total global oil production

Peak oil opportunities and challenge at the end of cheap petroleum

Peaking of World Oil Production: Impacts, Mitigation, & Risk ManagementRobert L. Hirsch, SAIC, Project Leader(commissioned by US Department of Energy, February 2005)

EXECUTIVE SUMMARYThe peaking of world oil production presents the U.S. and the world with an unprecedented risk management problem. As peaking is approached, liquid fuel prices and price volatility will increase dramatically, and, without timely mitigation, the economic, social, and political costs will be unprecedented. Viable mitigation options exist on both the supply and demand sides, but to have substantial impact, they must be initiated more than a decade in advance of peaking.

Gao report on peak oil
GAO report on Peak Oil

  • Released April 2007; conclusions:

  • Did not attempt a time estimate; forecasts of peak range from 2005 to 2030

  • The risks are serious and growing

  • At best, the US can replace 4% of its liquid fuels with alternatives by 2015

  • Secretary of Energy should establish a federal Peak Oil strategy

What are the alternatives
What are the alternatives?

  • Liquids from natural gas (Fischer-Tropsch)

  • Liquids from coal

  • Biofuels

  • Hydrogen

  • Electrified transport

  • Conservation

Post Carbon Institute

A second coal study
A second coal study…

From “The Future of Coal” report to the European Commission from the Institute for Energy (in draft)

  • “[T]he world could run out of economically recoverable … reserves of coal much earlier than widely anticipated.”

  • “The amount of actual recoverable coal is … less than the widely published estimates of reserves.”

  • “[C]oal might not be so abundant, widely available and reliable as an energy source in the future.”

Post Carbon Institute

World energy
World Energy

A liquid fuels crisis
A liquid fuels crisis?

  • Because of impending supply constraints for natural gas and coal, “Peak Oil” is not just a liquid fuels crisis, but the beginning of an across-the-board energy crisis affecting over 90% of current sources.

  • This must inform our strategy: fuel switching will be of limited help, and attention must be paid to electricity supply.

Post Carbon Institute

Evaluating supply options
Evaluating supply options

  • Energy return on investment

  • Size of resource

  • Infrastructure requirement

  • Convenience of use

  • Environmental impact

  • Renewability

  • Scalability

  • Location of resource

Conservation efficiency and curtailment
Conservation: efficiency and curtailment

  • Like alternative energy sources, conservation (efficiency) requires investment.

  • Investments yield diminishing returns.

  • However, at least in the initial stages, efficiency is almost always cheaper than new supply options.

  • Curtailment is the cheapest option of all, but requires changes in habits and expectations.


  • Energy supply problems will arise soon

  • We are not prepared

  • As time goes on, the supply challenge will spread to include all fossil fuels

  • There is no credible scenario in which new energy sources can be ramped up fast enough to make up for these accelerating supply shortfalls

  • We must begin now to design a lower-energy societal infrastructure

Postcarbon org richardheinberg com

Peak oil opportunities and challenge at the end of cheap petroleum

Transportation: Electrify it!

Rail and light rail—the best long-term options for motorized land transport of freight and people… electric air transport as well?

Personal land transport
Personal land transport

  • The Velomobile

  • 20-50 times as efficient as a Prius

  • Electric assist