25 thoughts on “So Much For Peak Oil”

  1. But it’s not about ideology. It’s not. It’s not. It’s not. [Jumping up and down stamping both feet.]

    In a sane world we’d all be extras in a Frankenstein movie… pitchfork and torches… or tar and feathers… but these ‘green’ politicians would definitely be run out of town.

    That we don’t speaks volumes about the ratio of useful idiots who rather than being ashamed are always in-your-face. Only during the days immediately after 9-11 were they quiet.

    1. In a sane world we’d all be extras in a Frankenstein movie… pitchfork and torches… or tar and feathers… but these ‘green’ politicians would definitely be run out of town.

      So what has been preventing you from organizing a lynch mob?

  2. Um Rand, oil shale is not shale oil.

    Shale oil is sweet light crude that comes from fracking, largely in the North Dakota Bakken formation. This is the stuff over which oil man Harold Hamm got “face time” with Barack Obama, telling the president how important this resource is, to which Mr. Obama brushed him off, saying “Oil has only a few years left; Secretary Chu tells me that with advances in battery technology, we will have a practical electric car.”

    Yes, stamp your feet about Mr. Obama and Dr. Chu without a clue, but the discussion was shale oil.

    Oil shale is that rock that they have a lot of in the Green River formation, and yes, there is a lot of it, but there are genuine environmental concerns regarding its exploitation, not this namby-pamby, “Ooooh, nooo! Fracking! I can set fire to my water faucet!”

    Oil shale was the stuff that Jimmy Carter was going after with the Synthetic Fuel Corporation, which proved to be the moral equivalent of wind power once Mr. Reagan deregulated oil prices.

    C’mon people, say it with me, shale oil is not oil shale. Shale oil is not oil shale . . .

    1. Very true, but is “shale oil” actually “oil shale” in Spanish or French, and vice versa? 😀

      We need a new word like “kerogenitic shale” to describe oil shale. In my comment below I called shale oil “conventional oil released by fracking.”

    2. There is a reason why oil shale has the adjective “oil” as part of its name. As Rand notes, the economics are glossed over but there is shale oil in them thar oil shales.

    3. Well, the difference is that shale oil is like shale saturated with corn oil, where you just crack the rocks and let the oil flow out, but oil shell is like shale filled with lard. It either has to be heated to get the lard to melt or the lard has to be chemically altered to a lighter weight unsaturated fat so it becomes liquid.

  3. Tar sands and shale oil become commercially viable at a lower price point than wind and solar, as does coal to liquids. Their implementation might be slowed by the massive expansion of fracking for conventional oil and natural gas, however, which are even cheaper. At present fracking is almost exclusively being tried in the US and Canada, and when it goes global there will be downward pressure on oil prices.

  4. I’ve lost track of the stats, but as of 2006 recovery of oil from oil shale in Colorado would have been economical at $100/bbl. We were no where near that level in 2006, and haven’t spent much time above that level…not long enough to spur development. But when the time comes, it will be done. Oh yes, it will be done.

    1. Actually George, the Shell ‘Ice Wall’ In-situ recover method is supposedly economical at around $40 per barrel and you don’t have to strip-mine and retort to get it out so the environmental impacts are very minimal.

      1. Leave it to the Dutch to come up with a dyke. A kid with hammer… 😀

        I’d forgotten how low their cost on that method was, but they do face some EPA and environmentalist roadblocks since there’s a risk some oil in the rocks could end up in somebody’s gas tank, which would be a catastrophe. O_o

  5. My personal pet peeve when it comes to Peak Oil is the counter-argument that it doesn’t conform with the price system. This inevitably results in amateur (or even professional) economists talking down to Peak Oil believers and tarring them as economic illiterates. Now, considering that most Peak Oil believers are economic illiterates, this might appear harmless, but the fact is that it is entirely possible to believe in both Peak Oil and free markets.

    How? Easy.. oil isn’t sold on a free market. If there’s one commodity that is more subsidized, monopolized, or outright nationalized in the world, I’m not aware of it. Even coffee doesn’t come close. When I first heard about Peak Oil, I thought it was an argument for reduced government intervention. “Let the free market function and we’ll never run out of oil” is how I saw it.

    1. If there’s one commodity that is more subsidized, monopolized, or outright nationalized in the world, I’m not aware of it.

      Force. And for a lot of countries food and water is more heavily subsidized, etc.

  6. Things like shale (mentioned in the article) or methane hydrate (not mentioned in the article) have been known to exist for yonks the issue is how to exploit the resources in a cost effective manner. AFAIK wind power, contrary to what the article says, is cheaper than either given current technology and is cheap enough to compete with coal and natural gas if used properly. Solar power keeps getting interesting R&D results and lowering in price all the time so it should eventually get to the point where it is price competitive with other energy generation methods.

    1. There’s a way to get lower prices for commodities, and the creation of replacement technologies for those commodities.. it’s the most effective way that has ever been invented by humans to achieve this. Do you know what it’s called?

      The free market. Does it apply to energy? Not in a century.

    2. I’m not so sure on solar. Currently, due to the price collapse, you can get solar modules for about $1.20 per peak Watt. But for the average US location, the average Watt is one fifth of peak, so take the price as $6.00 per average watt, or $6,000 per average kilowatt.

      The module cost has been running about 35 to 40% of the total installed system cost, and the rest of the system isn’t dependent on the price of solar cells, so those costs are by and large fixed. That should come to around $9000 per installed average kiloWatt, even if solar cell prices fall to zero.

      Assuming a 3% market rate for money and the demand for a 10-year pay back on the investment, electricity prices would have to stay at or above $0.14 cents a kWhr to make the investment pay off, even if solar cells were free. If the cost per peak cell falls to $0.50 cents a Watt, which is more realistic, the price of electricity would need to stay above $0.17 cents per kWhr. Most states are paying $0.06 to $0.09 cents a kWhr for coal, nuclear, and hydroelectric, (including the costs of supporting the existing electricity infrastructure) so the solar installations will never pay off.

      Rough data from Solarbuzz and IEA electric costs

      1. The cost of solar is much greater than just the cells. And, the current price is also a function of relatively low demand, You try to buy enough to significantly impact our energy supply, and the price will shoot up rapidly, especially when the necessary material availability starts to be crimped. The energy density is so low, it takes A LOT of material to make an impact.

    3. “AFAIK wind power, contrary to what the article says, is cheaper than either given current technology and is cheap enough to compete”

      I’d like to see more detail.

      AFAIK, wind power -itself- “works”. But the catastrophic combination of a list of issues: (transmission, power smoothness, time-of-day, “triplicate” generators to fight above) cause quite irksome problems.

      There was an article in the last half year in the Canadian press about Washington’s wind power. Appearently, we’ve done -very- well in building them and getting them attached to the grid. But our wind is very temporal – and not at peak usage. So we’re producing too much energy for the grid to handle safely at non-peak periods – and that energy has to -go- somewhere. So we sell it to Canada. At a -negative- dollar amount (Because it’s actually an unwanted waste at that time). Then … we don’t have the production capacity to meet our needs during peak, and buy the same energy back. (For positive money).

      IOW: The generators are generating efficiently, but we’re losing money thrice on the deal (capital outlay, high rates off-peak, high rates -on- peak).

      (The solution IMNSO is to have the wind -pump-water-. Pumping and making energy from falling water are the two most technically efficient operations I know of. Fill Grand Coulee, Hoover, etc with water from -below- the dam. This option was avoided because “We’re going to be getting rid of the dams, that won’t work.”)

      1. There’s also a minimum flow requirement–the dams have to allow a certain amount of water to flow downstream (some for the fishies, some for transport). There are going to be times of the year where pumped storage is going to be impractical.

        I was driving along the Columbia Gorge a few days back; most of the dams I passed were spilling water over their spillways (the snow pack is apparently melting fast enough that they need to draw down the reservoirs). I couldn’t tell if the generators were running. Most of the windmills I passed were churning. I got the feeling with no real evidence that if it weren’t for giving the windmills a nice photo op the water would be passing through the generators instead of over the spillways.

        1. I don’t think the flywheels are going to be cost-effective for longer-term storage, or at least not for a while. 20 MWhr will cover about 100 people for 1 day, or 2400 people for an hour. It’s great for grid stabilization, but pumping water up a hill or compressing air in undersea airbags (an interesting innovation that essentially pumps the ocean upward) is probably more cost effective for bulk storage. Also of interest regarding compressed air storage is air injection technology. A gas turbine is compressing air and expanding air, so just divert some of the high-pressure air for later use instead of running it all through the combustor section immediately.

    4. “wind power, contrary to what the article says, is cheaper than either given current technology and is cheap enough to compete”

      so THAT’s why Spain’s “green energy” sector went toes-up the second the government cut its funding!
      …waitaminute…

      1. Spain’s issues are more than just the wind power. Spain actually has less wind generating capacity than other countries which are doing ok and Spain has some nuclear power generation as well unlike some of those countries. The subsidies were inane (and mostly copied verbatim from the German renewable subsidies I might add). IIRC the government paid per kWh generated even if the electricity wasn’t necessary at the time. Then there were scandals like solar power plants which were generating power during the night. Turns out the owners of the plants were using portable generators burning fossil fuels to get the “green energy” credits. The problem was giving the subsidies and tying them to a specific form of generation in the first place.

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