Monday, November 30, 2009


Even Denmark Is Still Hooked on Fossil Fuels

Denmark, king of wind power. Of course that is good. We ought to build all the renewable-energy capacity we can right now, while it’s still possible. But we shouldn’t fool ourselves into thinking that we can free ourselves from dependence on fossil fuels and maintain our lifestyles.

The Globe and Mail has a really good article, “Oil still fuels the green state of Denmark,” which details the situation for a country that is considered far ahead of others in wind power. Denmark is still highly dependent on fossil fuels not only for power production, but also for earning money from oil and gas exports. And from drilling equipment. Of course, this is not to make light of Denmark’s laudable wind-power achievement, but we have to be honest in assessing how far renewables can go, and in acknowledging that fossil fuels are needed to run an industrial economy.

Sunday, November 29, 2009


Attacks on Police

A gunman charges into a coffee house and, in gangland style, guns down four police officers. No, this isn’t Mexico, it’s the US of A. And the incident was preceded by another assault on police in Seattle. Targeting police is an open challenge to the authority of the state, a topic I have dealt with in a number of previous posts. Murder of any kind is abhorrent, but attacks on police are an indication of the erosion of state power and incipient chaos, not to mention growing unrest.

Saturday, November 28, 2009


Dubai Crash

There is plenty of news on Dubai, so I won’t waste a lot of words here. Some people are saying this is a “black swan” event, but don’t you believe it. This fiasco was totally predictable, and it has been building for years. Anyone with a functioning brain and energy consciousness could see this would not come to a good end. What fossil fuels giveth, fossil fuels taketh away (here is an interesting article in that vein). Of course, Dubai might rally for a time with an infusion of cash and some good luck, but ultimately its skyscraper hotels and other structures will turn into corroded monuments to futility, and Dubai will go back to being a desert populated by a few people and their camels (I don’t mean that disparagingly; environments determine how people live, and what cultures and societies arise). Whether the crash is slow or fast, it began back when foreign workers started fleeing the UAE. It will be instructive to watch how the inexorable progress of events proceeds.


How Much Extractable Uranium?

With all the talk about a “nuclear renaissance,” you’d think there were no worries about fuel. But in fact, all non-renewable resources are subject to the same constraints. A New Scientist article, “Nuclear fuel: are we heading for a uranium crunch?” takes up the question of whether we could really fuel a new crop of reactors (assuming we have enough money to build them).

First, just as with oil, there is no question that the absolute amount of uranium left to be extracted is large, but again, just as with oil, the problem is whether it can be extracted economically.

Second, will there be enough investment in new mines to extract the needed amount of uranium?

Third, uranium resources might be overestimated. Because oil-producing countries have no doubt overestimated their reserves, it follows that, for various reasons, the amount of economically extractable uranium is also overestimated.

Owing to the challenge of financing and the lack of cheap primary energy (fossil fuels), it is certain there will be no nuclear renaissance. It is very likely that we will not get as far as experiencing a uranium shortage.

Thursday, November 26, 2009


Popular Backlash

There is, of course, only so far elites can go. But they will keep testing the limit until unrest and anger erupt and overflow. In “15 Signs American Society Is Coming Apart at the Seams,” the author cites 15 indicators of how elites are pushing the envelope, and speculates that a “heavily armed populace” (recall that US sales of guns and ammunition are spiking) will soon reach the end of its rope. In another recent news item, the managing-director of the International Monetary Fund, Dominique Strauss-Kahn, warned a gathering of business leaders that if the financial sector were to seek yet another tax-money bailout, the “man in the street” would not stand for it. A business media article, “Employee Discontent Expected to Reach Crisis Level Next Year,” reports the results of a survey showing that North American workers are fed up with their lot. Couple that with growing industrial unrest and farmers’ protests around the world, and we have an explosive cocktail that could blow up in the faces of elites at any time. “Disgruntled” is not quite sufficient to describe the increasingly ugly mood prevailing across the globe. And wherever popular backlashes erupt, they will add to growing worldwide chaos.

Tuesday, November 24, 2009


Piracy Hotspots

A BBC article reports a pirate attack on a tanker off the coast of west Africa, but it’s not an isolated incident, as the article also notes, “The International Maritime Bureau (IMB) says piracy in the waters of west Africa is on the rise, with 100 such incidents recorded last year.” Naturally, not all incidents are reported for various reasons (shippers don’t want their insurance to go up, for example), so the actual number is certainly higher. The pirates were thought to be from Nigeria, which is politically unstable. Political instability and poverty, not to mention weakened state power, provide a breeding ground and opportunity for pirates, rebels, and other non-state actors.

The waters off Somalia, and now the Indian Ocean, have gotten all the attention lately, and we hear little about west Africa, or the Malacca and Singapore Straits. As this article informs us, these straits in Southeast Asia had about 200 pirate attacks yearly until 2002. And why are pirate attacks so few there now? Because countries in the region expend much energy in conducting joint military patrols. When budget cuts, costly fuel, or other factors reduce or eliminate those patrols, pirates will lose no time in expanding their operations.

Wherever state power falters, we will see power vacuums and non-state actors ready and willing to fill them. Another case in point is Yemen, which has begun to disintegrate. Recall that energy is needed to maintain the state’s hold on power. When there is no longer enough energy, chaos ensues.

Monday, November 23, 2009


Repatriation of Foreign Workers in Japan

Earlier this year I published a post about foreign workers of Japanese extraction in Japan being induced to leave Japan by paying their way home. This article has some follow-up information, noting that there have been about 16,000 applications for the program. Not mentioned in this article is that by far the most applications were made in Aichi Prefecture, the home of Toyota. It’s indicative of the large number of workers that the automaker has shed since the economic bust started.

Sunday, November 22, 2009


Initial Energy Investments Needed for Renewables

In relation to a number of other posts — a recent one would be The Importance of Net Energy — I want to call readers’ attention to a post on The Oil Drum by Jeff Vail, The Renewables Gap: The Political Challenge of Affecting a Societal Transition to Renewable Sources of Energy. This is a good read because he analyzes how much energy needs to be invested initially (“up front”) to make a transition from our current energy regime to one that depends on renewables. The important thing to keep in mind is that because we don’t just have a lot of spare energy lying around (which is why oil is not $10/bbl even amid a severe global recession), whatever energy we dedicate to the needed initial investments has to come from our current energy budget, thereby leaving us with less for our day-to-day energy needs. That of course makes energy even more expensive than it would otherwise be. Even Vail’s “optimistic” scenario reveals a wide gap. Of course problems such as the need for fossil fuels to maintain renewable-energy infrastructure are beyond the scope of his analysis, so recall those after reading the post for the full impact of all the implications.

Thursday, November 19, 2009


Downward Energy Spiral

A news story about the difficulty of getting new power plants built in Germany illustrates the downward energy spiral and the great arduous struggle that countries will experience in extricating themselves from its downward pull. Around the world, governments and businesses anticipate the need for more power to fuel further economic growth — providing there is ever a “recovery.” The prolonged recession, crushing debt, and credit crunch are curbing the flow of funding needed to invest in more generating capacity, more oil field development, and other energy production. Although world energy production and consumption have been going up little by little, because world population keeps growing, per capita production actually peaked a long time ago, in 1979 (PDF). That means we have been in a downward spiral since then, but many of us don’t notice because energy consumption is unevenly distributed around the globe.

Difficulty in building new energy-production capacity will further exacerbate the downward spiral. In addition to a broad swath of the globe already experiencing endemic power shortages, the problem could readily spread to OECD countries and easily disrupt their now-fragile economies. While crash programs to build new generating capacity might help, economic stress makes funds unavailable, and not enough generating capacity endangers the economic growth that might create the needed money, so we have a vicious circle feeding the downward spiral.

Therefore in addition to the threat of too-expensive oil, we have another threat in the failure to boost electricity production. Both are very bad news for modern societies.

Wednesday, November 18, 2009


Oil Price and Recession

I was going to write about this CNN article “Forget $100 oil. $80 oil is a problem,” and then noticed that Robert Rapier over at R-Squared Energy Blog has already said pretty much what I was thinking. So do read that post (as well as the CNN article) if you have the time.

I’d just like to add one thing. Whenever debate starts on what triggered this recession, some people argue that over-leveraging was also a big cause or even the biggest cause. Certainly over-leveraging played a big part, but in that respect I want to point out once again the immortal words of Colin Campbell when he said, “Tomorrow’s Expansion was collateral for Today’s Debt.” This very succinctly describes how rosy expectations of more growth — courtesy of fossil fuels — led all parties concerned to lend and borrow with abandon. Therefore when we start digging into the mountain of debt, we likewise “strike oil.”


Winter Heating

If you are in the northern hemisphere as I am, it’s starting to get a bit chilly, and people are cranking up the heat. While the poor have little or no heat, people in the developed nations have it pretty good thanks to fossil fuels. But since we know the party will soon be over, it’s never too early to think about how we’ll keep warm in an energy-constrained future.

About a year and a half ago I wrote a post that directly addressed this issue. Briefly, if we follow the traditional Japanese model and concentrate on heating the body instead of the building, we can stay warm with far less energy. Of course that means we can no longer lounge about the house clad only in our skivvies. It means wearing a jacket or heavy sweater indoors, and piling on the blankets and comforters at night. In the family room of my house we have a kotatsu and a wood stove to take the chill off. No other rooms are heated. At night one takes a hot bath and hops into bed. You get used to it and come to realize that it doesn’t matter if it’s below freezing indoors and you can see your breath.

Naturally this can create other problems in the US, where houses are built with the assumption that they will be climate-controlled. If a house is not heated, it could get mold problems and frozen pipes, for example. That said, there will simply be no central heating in the future, so people should think about how to deal with this sooner rather than later. If you are still living extravagantly with regard to heat but know you must make the transition to “cold-house living,” now is the time to take the leap before it really gets cold. In thinking about how to do it, use your imagination. Everyone has unique circumstances, so your solution may be nothing like your neighbor’s. Just remember the basic idea: heating the body instead of the building.

Friday, November 13, 2009


The Importance of Net Energy

Long-time readers will recall that I have stressed the importance of net energy (EROEI) many times. Further, I have made no secret of my conviction that renewables cannot maintain industrial civilization. Therefore we will have to considerably lower our expectations and go back to the age-old practice of frugal, small-scale living. As if to echo and reinforce this message, the Post Carbon Institute has just released a report called “Searching for a Miracle: ‘Net Energy’ Limits & the Fate of Industrial Society.” The overview says just what I have been saying: That renewables have low net energy, and that all energy systems are highly dependent on fossil fuels for inputs. But don’t take my word for it. Read the linked page, and if you are so inclined, download the PDF of the entire report.

Thursday, November 12, 2009


Peak Gold

In my post of November 8, “EROEI and Ore Mining,” I directed readers to an article that applied the EROEI yardstick to ore mining. In a timely manner, the UK Telegraph has just published a piece titled “Barrick shuts hedge book as world gold supply runs out,” which illustrates this very reality with the example of gold. So, in addition to the worldwide flight to gold sparked by the deepening world economic crisis, “peak gold” is another factor that will push up the price of the yellow metal.

It’s not my place to tell readers to invest in gold. All people have to make their own choices based on their unique circumstances. But it’s definitely something to consider seriously.

Tuesday, November 10, 2009


Give Me That Old-Time Religion

Call it amusing, call it sick, call it brazen, call it the truth… There have certainly been many different reactions to the recent assertion by the chairman of Goldman Sachs that bankers are doing “God’s work.” No doubt a lot of bankers believe that, which is fine; they may, like Fox Mulder, believe whatever they like. Readers will likewise have their own opinions on this matter, so I leave it to your judgment.

Speaking of old-time religion, another one is nuclear power. In order to “reduce CO2 emissions,” governments around the world are developing and announcing big plans for that holy grail, the “nuclear Renaissance.” There’s just one little spanner in the works, and that’s cost. Britain has announced a plan to build 10 new nuclear power plants, but this plan too is likely to make little or no headway because of cost. As we can see from the so-called credit crunch, a colossal pile of money has already disappeared, and a lot more is slated to disappear in the near future. Consequently, such large-scale and capital-intensive projects become increasingly difficult to fund. Another gargantuan project that will never happen is Japan’s maglev train, which has been in development for years. Nuclear power and maglev trains are products of a bygone age when energy was cheap and plentiful, and as such they have no place in our new world of declining energy.

Unfortunately, our governments and most of the world public still fervently embrace such religious beliefs, so look forward to a lot more of our precious remaining energy, resources, and time being thrown down a rat hole.

Sunday, November 08, 2009


EROEI and Ore Mining

The Market Oracle has a really fine article, “Peak Silver and Mining by a Falling EROI,” which applies the concept of EROEI (also called EROI) to ore mining. Readers are no doubt familiar with this way of measuring how much energy you get for the amount invested, and this article starts by reviewing it, then applying it to ore mining.

The energy cognoscenti will already have caught on: We exploit the low-hanging fruit first for ores as well as for energy, so that as time goes on, we have to keep expending more energy to get the same amount of end-use resource. Even if you are one of those who already “get it,” this article is chock full of charts and graphs that illustrate how grave the situation is, and therefore well worth a few minutes of your time.

Needless to say, the implications for industrial civilization are enormous. The saving grace with metals is that they can be recycled, which unfortunately does not hold true for fuels.

Friday, November 06, 2009


E=mc2 and Renewables

Energy Tribune has an article well worth reading called “Understanding E = mc2.” It’s a different approach to showing why renewables don’t pack enough punch to power industrial civilization.

Assuming readers will check it out themselves, I’ll just use this post to point out two flaws.

First, the author notes that nuclear energy provides a far larger amount of energy, which is true, but he also claims that it has a “vanishingly small impact on the environment.” Why anyone would dare to make such a patently false claim is beyond me, since everyone knows that, from uranium mining to waste reprocessing, nuclear power assaults life on Earth with massive quantities of radioactive waste. Go ahead — walk into a high-level nuclear waste repository, commune with the waste, and tell me how long you live to tell about it. That impact is “vanishingly small”? And the “no emissions” claim is a crock of baloney.

Second, the author operates under the same flawed reasoning as other energy gurus by not realizing that nuclear power is impossible without fossil fuels. Once we realize that coal and oil underpin the nuclear power industry, and that nuclear power presupposes the coal- and oil-powered industrial infrastructure, we also realize that nuclear power will wind down in tandem with the rest of industrial society. Nuclear will keep the lights on only until breakdowns occur or stockpiled fuel runs out, whichever comes first.

Thursday, November 05, 2009


Incipient Global Chaos and Destabilization

The Times Online Crime Blog has a piece titled “Counter-terror plans will be revised to reflect Fort Hood and Afghan attacks,” which has a message other than that intended by the writer. From this blog posting we gather that military and civilian authorities must now worry about “terrorists” with a new modus operandi that works by attacking from within places heretofore considered safe and secure. It also cites the Mumbai attack as an example.

Mumbai does indeed fit into the picture, but this isn’t just a matter of “terrorists” (now a cover word used to label anyone considered undesirable by the authorities) having discovered a new way of striking their targets. If we see these incidents in the context of the big picture, it is obvious that they are stress points where the global system is coming apart at the seams. And through the splits in the seams, we can see chaos emerging. Recall also that non-state actors are always looking for chinks in the armor of state power, and testing them.

Some other related recent events are the chaos in Yemen bleeding into Saudi Arabia, Afghan police thoroughly infiltrated by the Taliban, the spreading Maoist rebellion in India, and, in an echo of attacks on police stations in Mexico, an attack on a police station in Greece. Look for more of these challenges to state power, and the resulting chaos as the global system weakens and destabilizes.

Wednesday, November 04, 2009


More on “Collapse”

Time for an update on the documentary “Collapse,” which is about to start its theater run.

First, the November 4 Wall Street Journal has an article on the film, including a short interview with the film’s star, Michael Ruppert. Despite the shortness of the interview, a few important points are brought out. One very important fact that Ruppert states is that “money is useless without energy.” Some readers of this blog will perhaps recall this post from June of this year in which I made this same point and illustrated it with an example. We tend to put all costs in terms of money, and lose sight of the fact that actually energy is doing the work, with money merely being the means of accessing and mobilizing energy. If you are concerned about this and much more, definitely take any opportunity you have to see the movie. Since I am in Japan, I’ll have to wait until a DVD is available, but having followed Ruppert’s work for some years, I can well imagine the barrage of uncomfortable facts that assault the viewer.

Second, the WSJ article refers to a new review of “Collapse” in Entertainment Weekly, which can be read here.

Tuesday, November 03, 2009


On America Going Broke

Quite germane to our current topic of sovereign default is a column titled Could America go broke? in that venerable medium of news and opinion, The Washington Post. The columnist — who likewise uses the US and Japan as examples — makes it sound as though a default by either country is highly unlikely. But of course he omits mention of the primary reason why both countries are almost certain to go bust and default: Peak oil. For example:
Governments of rich countries are borrowing so much that it’s conceivable that one day the twin assumptions underlying their burgeoning debt (that lenders will continue to lend and that governments will continue to pay) might collapse.
Certainly these are two of the assumptions, but they are most definitely not the only ones. Everyone also assumes that cheap energy will make more economic growth possible. Naturally, the columnist can’t bring up the expensive energy factor because that would make it immediately evident that the US, Japan, and a number of other countries are already on their way to fiscal doomsday. And by the way, America is already broke.

Sunday, November 01, 2009


Public Debt, Default and Prosperity

In a previous post, Defaults by Developed Nations?, I said of Japan’s public debt-to-GDP ratio, “It’s a prime example that a lot of our ‘prosperity’ is actually financed with debt.” I don’t mean to say that I told you so, but in this article The Telegraph’s economic commentator Ambrose Evans-Pritchard outlines Japan’s — let’s be honest — absolutely hopeless financial situation. Japan’s skyrocketing debt-to-GDP ratio is projected to keep shooting for the stars:
The IMF expects Japan’s gross public debt to reach 218pc of gross domestic product (GDP) this year, 227pc next year, and 246pc by 2014.
With the industrial system in decline and no more hope for economic growth as in the good old days, this is tantamount to digging one’s own grave. You’ll find more sobering (terrifying?) facts in the article, so I encourage everyone to read it themselves.

Of course, Japan isn’t the only country headed for a train wreck. The world is full of toxic and unsustainable debt, with a raft of matter-of-time defaults and bankruptcies just waiting to happen. China looks hot, but upon closer inspection appears to be growing a big bubble. What’s more, the world as a whole is sitting on a huge derivatives time bomb. The amount is so big that just one glitch could prove catastrophic. So, name your poison.

But to return to the matter of prosperity, it’s abundantly clear that modern industrial prosperity has come from cheap fossil fuel energy and from debt. Further, all this debt accumulated because the world has always counted on cheap energy to fuel still more growth, which would, in theory at least, make it possible to pay off the debt. At least that was Plan A, and now we have come to the point where Plan A has failed and, mired in denial, we still have no Plan B. Even at this date, all governments in the world preach more economic expansion and assure their citizens that the good old days will return and that we’ll achieve sustainable growth.

So again, name your poison. And strap yourself in — it’s going to be a rough ride.

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