Tuesday, November 02, 2004

Oil Endgame 4: Halving the Gas & Conclusion

This is it for the first round of Oil Endgame analysis. The fourth pillar Lovins & crew identified as essential to bringing US energy use in line by 2025 or so is about knocking down natural gas consumption by cutting out the most inefficient of current usage practices. As they found:
Nearly all peak period electricity is made from natural gas—so inefficiently
that each percent of peak-load reduction saves two percent of total U.S. gas
use. Proven and profitable electric-efficiency and load-management methods
can save one-fourth of projected 2025 natural-gas demand at about a tenth of
today’s gas price.
Sounds sane, right? Obvious also? That's what gets you about this stuff. A layperson might assume that market forces would squeeze out inefficiences so we must have a super efficient system that rewards continual improvement. My experience is that the opposite is true -- the market rewards short-term intertia and inefficiency.

Now AEman doesn't enjoy spending too much time on oil & old energy -- he likes to keep his eyes trained on the new stuff. But understanding the status quo is essential to building a baseline for comparison against which the new stuff is judged. The energy status quo is so entrenched, it's hard to believe. It would take a big player or a major upheaval in DC to begin to move us in a decidedly more intelligent direction. What would that be like ... well, something like this:

Using oil efficiently and displacing it with cheaper conventional substitutes could meet 80% of forecasted 2025 oil imports. The rest is less than what efficiency will capture soon after 2025. Domestic supply alternatives could even displace that last 20% plus, if desired, the forecasted domestic oil output. Making America oil-free within a few decades is thus both practical and profitable.
Who wouldn't want this ... More people than you think. Hey maybe you're one of them. If so, get the hell off of this blog !!!

posted by Andy Bochman at 8:53 PM

 

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