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Oil no longer the dressing for the '3,000 mile Caesar salad'

By Russ Grayson - posted Monday, 7 November 2005

Go local. That’s the suggestion of NSW North Coast community educator, Tim Winton, for coping with the approaching peak oil crisis.

“Peak oil” describes the reaching of a peak in global oil production. After that, an inevitable decline kicks in, with increasing scarcity and rapidly rising prices. Far from being the idea of doomsayers, economists and the petroleum industry are taking the threat seriously. The basic underpinning of industrial economies may be about to disappear.

“Decline will follow the peaking of oil extraction”, warns Tim. “Economists say we have 30, perhaps 40 years before the supply reaches its peak but others put the time as much less, some as little as 5 years. I believe the economists are a little over-optimistic. Whatever the figure, it leaves precious little time to develop alternative sources. The International Energy Agency says it will take around 30 years' lead time to scale up alternative energy sources to avoid economic dislocation.”


Peak oil seems to have come out of nowhere. According to Tim, oil interests did not want to scare investors so have given the concept little publicity. But some do see what is coming, he says. “It is interesting that BP - British Petroleum - changed its name to “Beyond Petroleum” and that Shell is also looking beyond the petroleum age.”

Potentially worsening the decline in supply is the likelihood that soon, we may be asked to share a declining oil resource with millions more people in China, and still to come, India. Assuming no alternative energy source comparable with oil is found, the impact will likely be the acceleration of price rises and a more rapid shrinkage of remaining reserves. A reduction of supply (however long it takes) that follows the peaking of supply will push up prices of most goods, including food.

A decline in the supply of oil has stimulated the search for alternatives to replace it. The fact the market usually materialises substitute products for those that go into shortfall has become almost an article of faith of free-marketeers - it was put forcefully by the late US academic economist, Julian Simon. The belief, though, has more to do with faith than with science - we must not assume because something usually happens that it will continue to do so.

Biodiesel is available on the Australian east coast although at present it is the fuel of choice for only a few early adopters. However for the initial phase of any post-peak oil shortfall, biodiesel may become the fuel that moves the nation. What holds it back is the lack of an Australian standard governing its production.

Then there are the fuel-efficient, hybrid drive vehicles such as those manufactured by Toyota, although there are lifecycle and waste management questions yet to be answered with this technology. Others say the “hydrogen economy” will save the day.

If hydrogen energy proves economically and technically viable that will be good news given our reliance on the long-distance road transport of goods and the lack of public transport in some urban regions. Hydrogen looks promising as a transport fuel, but we must be careful not to assume that it is the only answer and stop funding research into other sources of energy.


As for finding a substitute transport fuel in time, hydrogen-powered vehicles using hydrogen fuel cells already exist in prototype but the fuel cell is still some years from mass adoption. The alternative of producing hydrogen at centralised facilities, much as petroleum is produced at refineries, and distributing it through service stations is a more likely scenario.

Renewables, though they should form part of any future mix of energy sources, (commercial wind energy is already generated in south-eastern Australia) are of little use as alternative transport fuels. They are point sources that are geography-dependent and have to be sited where wind, tides and sunlight are most plentiful and constant. It might be possible, however, to substitute renewables for some non-transportation applications presently served by oil-based energy.

“I expect a big push by the nuclear industry as peak oil sets in”, says Tim, though that may be more pronounced in countries without the coal reserves of Australia. Already, China is interested in sourcing uranium here. In the West, proposals for new nuclear stations are likely to come up against the NIMBY syndrome even among people who otherwise support its development.

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About the Author

Russ Grayson has a background in journalism and in aid work in the South Pacific. He has been editor of an environmental industry journal, a freelance writer and photographer for magazines and a writer and editor of training manuals for field staff involved in aid and development work with villagers in the Solomon Islands.

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