Drilling Deeper – A Reality Check on U.S. Government Forecasts for a Lasting Tight Oil & Shale Gas Boom

The Post Carbon Institute (PCI) has today published a comprehensive report on the history and future prospects of the US shale oil and gas industry.

Part 1: Executive Summary
Part 2: Tight Oil
Part 3: Shale Gas

Report author, geologist David Hughes, has a tremendous command of the US tight oil and shale gas statistics equalled only by his ability to present this data in clear charts and maps and for these reasons alone I can warmly recommend this report to anyone with an interest in understanding the history of US shale developments to date.

The report challenges the upbeat views of the US energy future presented by the US Energy Information Agency (EIA), and there are certainly grounds to be sceptical about US energy independence, US net oil exports and exports of Liquefied Natural Shale Gas (LNSG).

I do not share entirely the vision that PCI has of the future. Hughes closing statement from the Executive Summary:

Rather than planning for a future where domestic oil and natural gas production is maintained at current or higher levels, we would be wise to harness this temporary fossil fuel bounty to quickly develop a truly sustainable energy policy—one that is based on conservation, efficiency, and a rapid transition to distributed renewable energy production.

It is not clear to me if the PCI vision for cities like New York is to run on distributed renewable energy. Or whether conurbations like this do not figure in their future vision at all?

Whilst I am 100% behind the conservation and efficiency aspects of this statement I am more than a little sceptical about a future based on distributed renewable energy. Can Manhattan really be run on this basis? And can these low quality energy flows really provide the surplus energy  for society to maintain global healthcare and food production at today’s levels? In the interest of being deliberately provocative, I believe it is worth considering that the average well being for humanity this century may be better served around cheap coal-combined heat and power (CHP) and nuclear power?

Who are the Post Carbon Institute?

Their mission:

Rather than planning for a future where domestic oil and natural gas production is maintained at current or higher levels, we would be wise to harness this temporary fossil fuel bounty to quickly develop a truly sustainable energy policy—one that is based on conservation, efficiency, and a rapid transition to distributed renewable energy production.

PCI People

Looking at The Board of PCI I find my good friends from The Oil Drum – Jason Bradford, Debbie Cook and Nate Hagens – together with Richard Heinberg, author of The Party’s Over which was one of the books that got me hooked on studying the relationship between energy and Mankind. Amongst other things, Richard’s book introduced me to the concept of Energy Return on Energy Invested (ERoEI) and since some of the “burn everything possible” blogs are now picking up on this concept it is clear that there are bridges yet to be built between Deep Green ecological thinking and those of us who want to party on with immunisation, heart surgery, fusion research and affordable food production for all.

USA Natural Gas Production

I have been on vacation for a week and have not had time to read the details of “Drilling Deeper” (that should actually be called “Drilling More”). But there is one point I would like to pick up and that is the notion that the some US shale gas plays may be peaking. Drilling liquids and gas in the USA has undergone an extraordinary evolution in recent years with a huge migration of drilling rigs away from drilling shale gas to drilling tight liquids plays.

US drilling rig count from Baker Hughes compared with natural gas production (gross withdrawals) from the EIA. Since 1995, the size of the US drilling fleet has grown from about 700 rigs to 2000 rigs. For a long while, the increased drilling effort was only sufficient to combat declines until the attention turned to shale. New shale plays clearly provided better production returns than pursuing the very mature conventional gas targets. The chart is about one year out of date and so needs updating when I have time.

Rigs drilling shale gas have dropped from 1600 to about 400 in the period 2008 to 2013. In the same period, US gas production plateaued at a level roughly equivalent to self sufficiency. It was not possible for the US to produce more gas in this period since it had nowhere to go. And that will remain the case until LNSG facilities are completed in the near future. What will follow is a normalisation of global natural gas prices that may mean much higher natural gas prices in the USA, that will have unpredictable consequences for economic growth and economic policy in that country. But one thing is certain, higher natural gas prices will improve profitability and perhaps expand the shale gas frontier.

Production in some shale gas plays has fallen because attention turned to liquids and the more prolific shale gas plays. Higher prices and more drilling may drive production in these plays upwards in the future though past production peaks may not be surpassed.

Shale Profits

To both counter and compliment what I have just said above is this Table of free cash flow for a range of shale operators compiled by Deborah Rogers forming part of the PCI media package.

There is a lot of red ink, but no problem here that European natural gas prices coming to America cannot solve. The big question is whether or not the US economy is sufficiently robust to withstand sharply higher primary energy costs that Europeans, Japanese and S Koreans have lived with for many years.

This entry was posted in Energy, Political commentary and tagged , , , , , , , , , , , . Bookmark the permalink.

63 Responses to Drilling Deeper – A Reality Check on U.S. Government Forecasts for a Lasting Tight Oil & Shale Gas Boom

  1. Sam Taylor says:

    I always wonder how many bullets are left in the efficiency chamber, exactly. One of the problems with efficiency savings is that they tend to suffer from decreasing marginal returns, and I suspect that we’ve picked most of the low hanging fruit already.


    • Willem Post says:

      Regarding EE, we have not even begun to pick the low-hanging fruit.

      Our non-city building stock, such as housing, could be “net-zero-energy”, and “energy surplus”, even with the buildings charging most of the EVs, using existing technology.

      That means migration away from cities, which, in any case, are artificial monsters anyway. Just look at the photograph in Euan’s article. Long-term, there is NO HOPE for these monsters.

      It also means reducing the population by about a factor of 10 by the end of this century. This will enable the OTHER, now greatly-reduced, fauna and flora to reestablished themselves on their hopefully not too ruined habitats.

      It also means reducing the energy use/capita and other resources/capita to about 1/4 of what it is to-day, the level of 1800. Of course, each of us would have to be using the energy and other resources so much more efficiently. Goodbye private yachts, planes, etc?

      • Euan Mearns says:

        Willem, on this one I think you are off beam. I believe apartment blocks are highly energy efficient. I saw stats on this for the UK. State-owned UK housing (Council Houses) are often viewed as poor quality but in fact, the blocks of flats are very energy efficient.

        And transport / travel costs in cities is way lower than rural living. And so the Passive Huss dream is a speciality niche, OK for those who can but not desirable or possible to scale this for the masses.

        Change all the lights in Manhattan to LEDs would be the first step to slashing power bills, especially in summer when it is hot. Not so in winter where heat producing lighting contributes to the heating of buildings.

        We should be thinking about building gigantic towers with accommodation, manufacturing, retail and leisure all in one.

        • Willem Post says:

          With a platform on top with convenient access, in case one wants to jump.

          • Euan Mearns says:

            Willem, I did consider adding something like this to my comment but as proprietor of the blog thought better of it 😉

            But I recently visited Canary Wharf in London where there are office towers, residential towers, retail and leisure facilities all within a short walk in a river side setting. High density urban living I believe is highly energy efficient. One may well live in a Passive Huss in an idyllic rural setting but then drive 40 kms round trip to the store or dentist.

    • Euan Mearns says:

      I suspect there are still major efficiency savings to be made although buying energy efficiency tends to be the domain of the wealthy. I believe that in 2050 (I’ll be 93 years old by then) that I could live the same life style as today using half the energy at perhaps double the total adjusted cost. On the back of oil price hikes of recent years I did trade in my loved 850 Volvo estate for a more fuel efficient V50 estate that is supposed to do over 55 mpgs. Its a very boring car but the fuel and tax savings are welcome. We still run an old inefficient gas boiler (furnace) at home. Had quotes for new on a number of occasions but £5K price tag keeps putting me off.

      • philsharris says:

        No crystal ball, but I will be 109 in 2050! However, I still have some stake because our next generation will be 73, 70 and 62 and then of course there are the others.

        I add just a few points – I know already that you personally actually get all this stuff – where society envelops the personal.

        I was told in 2008 that we in Britain were already living in 70% of the housing that will exist in 2050.

        I am lucky but many are not. My work pension is paid directly out of taxes and I do not need foodbanks or to be honest, my bus pass. Any saving on heating is discretionary for us, though that is not true for a significant fraction of our neighbours. It really is about affordability.

        I have not checked how much of our collective British energy use is ‘domestic’. Even though I agree a 50% drop for energy needed for house and car (we did that already) looks achievable for many of us, an economy running on 50% less with enough distributed utility (jobs covering needs with sufficient elbow room) is difficult to imagine just now.

        Interestingly much of the old Soviet bloc still has housing and district heating infrastructure that enabled survival in the 1990s. Much of Scottish central belt similar housing of the same era has had to be demolished. Can we hope for better solutions over the next decades?

        As a footnote – hot lighting helps heat buildings in winter, but it is probably economical to have LEDs and to put some of the x3 energy saved by peak-lopping electricity into Heat Pumps into the buildings and/or storage.


  2. Glen Mcmillian says:

    There is no conceivable way to reduce the population by a factor of ten within a century other than it happening on it and of itself thru a general collapse of the environment and economy.

    Personally I am convinced there will be a substantial die off of humanity in many parts of the world within a century but nothing approaching ninety percent overall barring nuclear or biological warfare getting totally out of hand.

    I do agree that we have barely begun picking the fruits conservation and efficiency measures that are technically simple and that will be easily implemented except for paying for them.And there will be truly substantial savings in energy thru changes in lifestyles which will be forced on us by necessity.

    We are hung up on inside the box business as usual thinking for no reason other than habit. Most people at present who can afford a new car are no more than contemptuous of the idea of buying a car that will go only seventy five miles on battery power before it needs a charge.

    But my grandparents who grew up using horses would have been astounded with such a means of transportation and the truth is that most of the people I know today could take care of almost all their essential driving with a Nissan Leaf.. The remainder could be easily accommodated by hanging onto an existing ice car or renting one.

    Installing triple paned windows and insulation in older houses is an expensive undertaking but nothing that can’t be managed more easily than paying outrageously high heating and cooling bills so long as credit is available and it seems safe to say that governments will make sure the credit is available.

    We will be doubling up more and more often – more people will be living together in smaller houses and some of the worst old large houses will be allowed to rot down and eventually be demolished. Building codes are going to be tightened up every few years forever or for as long as life as we know it lasts.

    Home grown energy in the form of solar domestic hot water and electricity are going to become fashionable options on new houses and tight fisted old republican types who hate hippies are going to be bragging about their pv installations while conveniently forgetting that they used to laugh at greenie commie environmentalists.

    Appliances are already full of little magic black boxes and computer chips right down to the level of coffee makers. Adding in a couple more to register cheap wind and solar power availability isn’t going to break anybody but doing so is going to guarantee that refrigerators and hot water heaters run mostly on wind and solar where it is available and when it is available.

    IF it becomes available in sufficient quantity- and I believe it will- we will have thermal storage built in in new houses in the form of a few tons of stone in the subfloor area which will take care of most heating needs for a day or two at a time when the wind is not blowing. Really well insulated houses with plenty of interior thermal mass can be cooled or heated a couple of extra degrees or even more when wind and sun are peaking and thus reduce the load on fossil fuel and nuke generating facilities substantially.

    Putting on a sweater requires only an attitude adjustment. Putting in LED lights requires only the good sense to do it since they are actually already much cheaper overall than incadescents and cfls.

    We will give up energy intensive habits such as flying far and often simply because hardly anybody will be able to afford to do so and because populist resentment of those who can will guarantee that jet fuel will be very heavily taxed- right along with gasoline and diesel fuel.Everybody with a business as usual mindset believes that Americans believe in a god given right to cheap gasoline and this is true- but it will remain true only so long as most of us can afford to own and drive a personal vehicle.

    A time is coming when such vehicles are going to be the exception rather than the rule and after that gasoline taxes will be looked at as sin taxes by non drivers.This will probably come to pass within the lifetime of most of us reading this blog today.

    The big cities are not going anyplace because short of the people living in them all dieing off there is no place for those people to go. Providing housing for them in new places would require many times as much energy as leaving them where they are now.

    And city dwellers can and do generally have low energy footprints compared to suburbanites and modern day country folks such as yours truly. I burn quite a bit of gasoline just fetching groceries from town whereas a city dweller can often walk to a store or ride a bike or take a bus or subway etc.

    Apartment buildings are much much cheaper to heat and cool than single family houses built to the same standards of insulation.A lot of things manufactured in a big city can be used locally without being shipped more than a few miles.

    And the long distance trucks are going to go piggy back on trains before too much longer.

    • Ed says:

      Here’s an other one. Freeways (motorways) will be electrified to take trolleybuses or trams. High speed train tracks will not carry high speed trains as most people wont be able to afford to pay 16 times the price to go 4 times faster. (I think I’m correct that energy used is proportional to velocity squared)

  3. Roger Andrews says:

    I would like to be able to say I’ve read David Hughes’ report in detail, but given its length “skimmed through” is probably more accurate. Impressions? It’s an exhaustive, well-researched and well-written analysis that on the face of it leaves little doubt that the EIA’s estimates of oil and gas production are optimistic. But are they? To make a judgment I would need to review how the EIA arrived at their conclusions, but EIA’s detailed calculations and data aren’t publicly available, or at least I can’t find them, so I’m left guessing. And having spent much of my professional career estimating reserves and resources in mineral deposits, where estimates of lifetime production can be subject to very large uncertainties (mostly related to price fluctuations, an issue the report seems to pay scant attention to), my best guess is that the truth probably lies somewhere in between the EIA and Hughes estimates, although both of them could ultimately turn out to be miles off.

    There’s also the question of sponsorship. I have no wish to impugn David Hughes’ professional qualification or ethics, but whenever a review of fossil fuels is commissioned by an organization that believes in “conservation, efficiency, and a rapid transition to distributed renewable energy production” the conclusions are predictable.

    Then there’s the question of impact. The Executive Summary claims that the shale boom is leading the US down the wrong path: “What this means is that the country’s current energy policy—which is largely based on the expectation of domestic oil and natural gas abundance far into the future—is badly misguided.” I challenge that. The Obama Administration’s energy policy is uncompromisingly pro-renewables. We see this in the “war on coal”, in the way Obama is using the EPA to circumvent Congress on CO2 emissions controls, in the Keystone Pipeline, in the fact that oil and gas production on federal lands is decreasing despite the shale boom and in the emotional rantings of Obama, Kerry et al. as to how climate change is destroying the Earth, which position them well out on what I term the “lunatic fringe” of the climate change debate.

    • Euan Mearns says:

      Tend to agree with your comments here Roger. I meant to say in the post that a likely outcome would be somewhere between the EIA and David Hughes’ forecasts. I was careful to say that I recommend the report for the historical perspective. The forecasting part is much more difficult and price obviously plays a key role. It’s interesting that they miss the fact that the Obama administration is as Green as any prior US administration though there is clearly a conflict here between the part of the energy system under government control and that part run by free enterprise.

      My take is this. The dream of LNSG exports turns quickly to a nightmare as nat gas prices double bringing coal back into vogue kicking the GHG savings argument into the long grass.

    • dennis coyne says:


      Hughes estimates are not based on prices at all, though the “most likely” scenarios could be thought of as little change in prices and the high scenarios as an increase in prices.

      Also note that an increase in US prices would result in lower demand for natural Gas as there would be switching back to coal for electricity, I doubt export of LNG will be profitable if prices rise within the US, converting natural gas to its liquid state and shipping it are quite expensive, the Russians might just undercut the price.

      Euan’s observation that higher prices might lead to more drilling may be true for a few of the shale plays, but there are several that are simply running out of locations in the sweet spots and higher prices will have little effect in those plays.

    • dennis Coyne says:

      The point is that the EIA’s projections are not very good, for either tight oil or shale gas.
      You guy’s should really do some reading and not dismiss the report because the PCI are not lobbying for more coal use.

      I have read the report and particularly on tight oil it is spot on, natural gas I have not analyzed as much, but the methodology looks solid to me.

      If oil prices continue to fall and natural gas prices rise by 50% in the US, then tight oil output might be somewhat lower than Hughes estimates and natural gas may be somewhat higher

      • Euan Mearns says:

        Dennis, its not my intention to dismiss this report, to the contrary I’m highly complimentary of it. But forecasting in the current environment is fraught with difficulty. The post I was going to write would have said that $50 WTI may kill shale liquids stone dead – broadening further the range of possible future scenarios.

        PCI are perfectly right and justified to challenge the view of the EIA. But they are standing on a heavily biased platform which unavoidably taints our perceptions of their objectivity. No sleight of David Hughes professionalism intended.

        In 2050 Manhattan will look exactly the same, lit by LEDs running on nuclear and coal power – not wood burning stoves and PV. They may have gigantic liquid heat stores capturing waste heat from power generation that is pumped into the city in winter time.

        • dennis coyne says:

          Hi Euan,

          I guess one has to be careful to look beyond the views of the PCI in general, so you think the people on the board of the PCI that you mention are not objective, whereas you and Roger have no bias?

          As I said, you should both try reading the report.

          You will find the analysis of the tight oil excellent and that Hughes analysis is quite conservative. Roger’s comment with regard to reality being between Hughes estimate and the EIA’s estimate is likely to be wrong, though he is correct that an increase in prices might help a little, analysis that I have done using the EIA’s reference oil price scenario lines up very well with Hughes analysis of the Bakken and Eagle Ford.

          On shale gas mostly the Marcellus and Woodford plays have room to grow, the other plays which are gas focused(ignoring Eagle Ford and Bakken gas output) are running out of room in the sweet spots and have peaked, Hughes shows how output would change if drilling were increased by a rise in gas prices for these plays and there is little effect for those plays (Barnett, Haynesville, and Fayetteville plays). Even Hughes more optimistic scenarios for these three plays are only half of the cumulative output of the EIA reference scenario (which assumes natural gas prices remain low). Also note that Hughes analysis for the Woodford and Marcellus suggests a peak around 2016 to 2018 and URR to 2040 nearly the same as EIA estimates (slightly higher for Hughes “high” scenario).

          The EIA Annual Energy Outlook expects much more oil to be produced from plays other than the Eagle Ford and Bakken than is likely at the prices forecast by the reference oil price scenario. The EIA natural gas forecast for the Woodford and Marcellus is similar to that of Hughes for cumulative output, For all other shale gas the EIA forecast is quite unrealistic. For all shale gas the EIA forecast is about double Hughes estimate.
          Roger’s comment that reality will lie somewhere between the two estimates may technically be correct, but the actual cumulative output through 2040 will be much closer to Hughes estimate than the EIA’s.

          Note that the Executive summary was not written by David Hughes.

          By Asher Miller, Executive Director, Post Carbon Institute

          from Page 1 of the report

          • Roger’s comment with regard to reality being between Hughes estimate and the EIA’s estimate is likely to be wrong

            Roger’s comment that reality will lie somewhere between the two estimates may technically be correct

            Make your mind up.

          • dennis coyne says:

            Hi Roger,


            I will go with the second. But you may be wrong, time will tell. I stand by my guess that Hughes estimate will be considerably closer to reality (say within +/- 10%) than the EIA estimates.

            The USGS does a fairly good job (though sometimes they get it wrong as well), but the EIA forecasts are quite bad. For example consider the Monterrey shale where the EIA needed to rollback their previous estimate by 96%.

            When there are two estimates say 50 or 100, and someone says reality will be between, I think 75 rather than 51 or 99, though all three numbers technically are between 50 and 100. Did you mean reality would be roughly the average of the two estimates of cumulative output? If so you are wrong, if you meant Hughes estimate might be 10% too low, you may be correct, but I would say there is an equal chance of Hughes’ estimate being either too high or too low.

            I agree with your assessment that prices will make a big difference and prices are not addressed in the report. In very general terms the various low scenarios in the report would tend to coincide with lower prices and the high scenarios with higher prices.

            Though Hughes does not say so explicitly, I think he was assuming that oil prices would roughly follow the EIA’s reference case oil price scenario when he developed his “most likely cases”.

          • I wrote above: “my best guess is that the truth probably lies somewhere in between the EIA and Hughes estimates, although both of them could ultimately turn out to be miles off.”

            This assessment covers all the possibilities. How can it be “wrong”?

          • dennis coyne says:

            Hi Roger,

            You are correct, a statement that is so general says very little and cannot be wrong, Effectively, you imply that output will be between 0 an infinity and I will agree that you are undoubtedly correct.

            I was not reading carefully and focused on the reality between the EIA and Hughes estimate part, my apologies. The both could be miles off addendum covers any possibility, my apologies. 🙂

            I was reading too much into your comment.

  4. If you desire a “rapid transition to distributed renewable energy production” then you need a plan for achieving this goal. Has the Post Carbon Institute developed one? I went to their website to check. I was unable to find any plan at all. But maybe I missed it.

  5. Jacob says:

    “rapid transition to distributed renewable energy production”
    “Distributed renewable energy” means SUN. There is no other. I wonder why they use long and complicated phrases to name a simple thing?

    Well, the sun produces energy about 20% of the time in southern latitudes, but only 10% in northern latitudes where most people live (eg. Germany).
    I’m apt to doubt the sanity of prophets who see a future based mainly on energy available only 10% of the time.

    • Willem Post says:


      The CF of PV solar is about 0.10 in Germany, but SOME solar energy is available about 65% of the hours of the year.

      With storage, such as lead-acid batteries, the hours of high availability and low availability can be smoothed, so a required level of solar energy, for electrical and thermal purposes, would be available, for example, from 4 am and to 10 pm.

      If a building is highly insulated and sealed, a la Passivhaus, it will have a long time constant regarding cooling down and warming up, i.e., outside temperature variations are greatly attenuated on the inside.

      One has to think outside the box to make it happen.

      • Willem

        Solar PV panels in Germany generate approximately six times as much electricity in June as they do in January, so you would need a large number of panels (plus batteries) to keep your solar-powered Passivhaus warm in the winter. But once you’ve installed all these panels you have a very large solar energy oversupply in the summer. The only solution is to have enough batteries to store surplus solar energy generated in the summer for re-use in the winter, but I doubt there would be enough room in your Passivkeller for that.

        • dennis coyne says:

          Hi Roger,

          Excess power can be dumped to ground if necessary, for grid tied systems, excess summer output can be used to conserve coal and or uranium or other (thorium in the future perhaps) nuclear fuel. Wind can also be used where there are decent wind resources. In every case any excess that can not be used with hydro storage or battery or fuel cell storage can simply be dumped to ground. Not particularly efficient. Also note that a Passive solar house could easily use underground water storage tanks to store excess energy during the summer, heating the water with a heat pump water heater.

          I think wind, solar, and nuclear should all be used. I think the coal CHP idea does not make sense, particularly if David Rutledge’s estimates of the URR for coal are correct.

          My guess is that you and/or Euan must be skeptical of these estimates because if they are correct, then as oil and natural gas deplete “cheap” coal will become expensive coal and the coal CHP idea is a waste of investment.

          If you think it is best to go with nuclear only, I disagree. Use wind, solar and nuclear in combination to obtain the lowest cost energy, but include all costs for each type of power (no more reduced cost liability insurance for nuclear plants). All of these technologies are fairly mature, government subsidies and other renewable portfolio standards (in the US) and the like should be eliminated to level the playing field.

          Another thing that should be eliminated is any grandfather rules for ancient coal power plants (those more than 40 years old), if they are not worth upgrading to meet current pollution standards they should be shut down.

          • Euan Mearns says:

            Dennis, you are not making much sense to me 🙁

            I think the coal CHP idea does not make sense, particularly if David Rutledge’s estimates of the URR for coal are correct.

            Surely extracting twice as much energy from the remaining coal makes consummate sense.

            If you think it is best to go with nuclear only, I disagree.

            You seem to be disagreeing with using coal and not using coal simultaneously.

            ancient coal power plants (those more than 40 years old), if they are not worth upgrading to meet current pollution standards they should be shut down.

            Or perhaps the pollution standards could be reviewed?

          • Dennis Coyne says:

            Hi Euan,

            Imagine coal supplies run short and coal prices rise by a factor of 5, will coal CHP be cheaper than a nuclear CHP system under those circumstances?

            That is my point. Do you agree with Rutledge’s estimates? If not what would you estimate the URR of coal to be? Also of interest would be your estimate of the C+C+NGL URR and natural gas URR.

            Here is what I said,

            “If you think it is best to go with nuclear only, I disagree. Use wind, solar and nuclear in combination to obtain the lowest cost energy,…”

            I think it is fairly clear that what I meant. You seem to favor a combination of coal CHP and nuclear and no wind and solar, so if coal is eliminated due to high coal prices that would leave you with nuclear only (when natural gas gets very expensive). I am suggesting a diversity of energy sources that have a relatively long life (the sun and wind will be with us for a while and uranium resources may deplete, but less so if fast reactors are developed.)

            So if you agreed with Rutledge’s estimate for coal URR and can foresee a steep rise in coal prices as coal depletes, then a long lived coal CHP investment may not be a good idea, why not simply use nuclear CHP as the fuel costs are not likely to escalate as quickly as for coal.

            Note that I updated Rutledge’s analysis using the most recent BP data and the estimated URR is 772 Gt of coal, at present rates of coal use the midpoint is reached by 2019 (this is not necessarily the peak, but the World peak is likely to be +/- 5 years from this, if the URR estimate is correct.

            You had once suggested you were concerned with coal use due to potential climate problems, though perhaps your understanding of the carbon cycle (which seems to ignore the calcium carbonate cycle) has led you in a different direction.

            I agree that CHP is a good idea, I think using resources that are relatively limited such as coal is not a very good idea, nuclear, wind and solar where they make economic sense long term is a better solution.

      • Jacob says:

        How many lead-acid batteries do you need to run an oven or a wash machine or a dryer? And how much energy do you need to produce them store, maintain and recycle? That does not work.

        People always utter the magic mantra “energy storage”. This is, at the moment, science fiction.
        Now, if we speak about science fiction – nuclear fusion seems more plausible to me. We will give up the fossil fuels when we will have something better. Solar panels with lead acid batteries are not. Thinking “out of the box” does not keep you warm (or cool).

    • dennis coyne says:

      Hi Jacob,

      I assume you have heard of wind power?

      A University of Delaware study of the Northeastern United States suggests a system with widely distributed wind and solar can provide 90% of demand hours for electricity at projected 2030 costs with natural gas backing up the remaining 10% at electric prices lower than 2012 prices. At 2008 costs for renewable (wind and solar) power 30% of electricity demand hours can be met at prices lower than in 2012 (prices would drop from 17 cents /kWh to 11 cents /kWh) and 60 % of total electrical energy needs would be met by renewables with very little storage needed.

      Paper at (upper left corner for PDF download)


      “We modeled wind, solar, and storage to meet demand for 1/5 of the USA electric grid. ► 28 billion combinations of wind, solar and storage were run, seeking least-cost. ► Least-cost combinations have excess generation (3× load), thus require less storage. ► 99.9% of hours of load can be met by renewables with only 9–72 h of storage. ► At 2030 technology costs, 90% of load hours are met at electric costs below today’s.”

      • Jacob says:

        These studies are very popular. They are a dime a dozen. I’ve read many of them. They are made by delusional greenies. This is not engineering, it’s wishful thinking. The simple facts are that solar and wind cannot be relied on, and need 100% backup by fossil and nuclear.

        This is a proven fact. The enormous amount of wind turbines (hundreds of thousands) and solar installations (probably 2-3 million) produce next to nothing, and have contributed to emission reduction – a grand total of zero. Emissions are on the rise in most countries, including Germany, the world leader in renewables.

        “We modeled”… ah… models… why not use real world data? “and storage” – more science fiction…

        • dennis coyne says:

          Hi Jacob,

          They used actual wind and solar insolation data. The wind data is really more important because most of the renewable electricity comes wind in the optimal (low cost cases). You are wrong about the 100% fossil fuel backup and even if you were correct, it is lower cost to have renewables in the mix at 30% for 2008 renewable costs, and 90% at 2030 renewable costs.

          Try reading the paper, obviously you went no further than the abstract.

          The emissions are less than they would be without the renewables, that much is clear. If you cannot see that, I give up.

          • dennis coyne says:

            They needed a model to find an optimized low cost configuration. Real grid data and wind data was used as input to the model over a four year period. The paper is in a peer reviewed journal.

          • Jacob says:

            “and 90% at 2030 renewable costs.”

            Oh, they know the renewable costs in 2030. What remarkable feat of prophecy!

          • dennis coyne says:

            Hi Jacob,

            Read the paper, they make very conservative assumptions about renewable costs in 2030.
            Do you think the costs of renewables in inflation adjusted dollars will not continue to fall in the future?
            No breakthroughs are assumed in renewable or storage technologies just a continuation of trends over the previous 10 years (paper published in 2012 so this would be over the 2001 to 2010 time frame).

    • Ed says:

      Doesn’t wind, tidal and wave count ? Load factor of wind is 30% of max. Tidal is available 100% of the time !! Just saying, that all. ps Tidal is not 100% as it has to change direction, but you get my drift 😉

      • Doesn’t wind, tidal and wave count ? Load factor of wind is 30% of max. Tidal is available 100% of the time !!

        Ed: No, tidal isn’t available 100% of the time. Take a look at this example plot. During spring tides you get four cycles every day when the power output cycles between 250 kW and zero. During neap tides you get the same four cycles, but your max power output is only a fifth of what it was during spring tides.

        Flattening that power curve out is going to take an awful lot of battery storage.

  6. Jacob says:

    On the other hand – mankind has live with ““distributed renewable energy” (the sun) until about 250 years ago. So it could probably survive in the same manner as it did in the pre-industrial age. But, sure, that isn’t something you look forward to or advocate.

    • Willem Post says:

      Not with 10 billion energy guzzlers and their energy guzzling conveniences.

    • dennis coyne says:

      We could certainly use renewables and nuclear, at some point the fossil fuels will deplete (possibly a peak in all fossil fuels within 15 years if David Rutledge’s estimates for coal are correct.

      • Ed says:

        Fossil fuels may already be very near peak if you look at Net energy available to society (ie minus the energy input used by the energy sector)

  7. Jacob says:

    About estimating oil and gas production to 2040 – I wish to remark that nobody predicted the current oil and gas boom ten years ago. We are not good at prophecy.

  8. dennis coyne says:

    Hi Jacob,

    Actually most people were not predicting this 6 years ago. The oil and gas boom is mostly a US phenomenon, mineral rights are different in most other countries and the shale boom is unlikely to be repeated elsewhere. In the grand scheme of a 3000 Gb URR for oil (C+C), the 15 to 25 Gb which will likely be added to the World URR from light tight oil is of little consequence, a brief reprieve from a decline in oil output that will arrive between 2017 and 2023.

    • Jacob says:

      “mineral rights are different” – mineral rights can be changed…
      “the shale boom is unlikely to be repeated elsewhere” – a new prophecy…

  9. Luís says:

    Whilst I am 100% behind the conservation and efficiency aspects of this statement I am more than a little sceptical about a future based on distributed renewable energy. Can Manhattan really be run on this basis? And can these low quality energy flows really provide the surplus energy for society to maintain global healthcare and food production at today’s levels? In the interest of being deliberately provocative, I believe it is worth considering that the average well being for humanity this century may be better served around cheap coal-combined heat and power (CHP) and nuclear power?

    These are just words. Scepticism or positivism should not be based solely on words. Ask the Indians about “cheap coal” of the French about “cheap nuclear”. I wish you could be a bit more objective.

    You are the co-author of this post, where we answered most of the questions you pose.


    • Euan Mearns says:

      Luis, in the UK, distributed renewable energy means roof top solar. Good luck with that in Manhattan or any other large city. There is some distributed wind on farms and some distributed micro hydro on “country estates” where large land owners receive large subsidies from the poor. Otherwise wind is in the hands of large developers, often large stock market listed utilities, this is centralised not distributed supply.

      Our Olduvai analysis had two cornerstones of 1) conservation and efficiency and 2) nuclear power. CHP is a potential major contributor to the former. Wind in the UK / Europe seems to be doing little more than adding noise, cost and infrastructure to the grid. I am possibly in favour of solar in sunny climes though it is not much good in winter when it is needed most and I still need to be convinced on ERoEI. If it is less than 1 we are digging ourselves a grave.

      If I agreed with you and Dennis would that make me objective?

      • Ed says:

        If renewables are to take off (as all our contributors on this site hope ), it will be though de-centralised community lead development. There are plenty of examples detailed in http://www.renewablesinternational.net/

        • Ed says:

          There was a ‘sarc’ missing in the brackets in my comment above. But seriously, the energy companies and central government ARE the problem. We, the people, the communities must take matters into our own hands. We WILL be using far far less energy in the future; and not though choice as Jacob seem to think.

          • Jacob says:

            “We WILL be using far far less energy in the future;”
            Well, fine. I can tolerate another prophecy.

            The practical question is if we need to be forced NOW to use less energy than is available. (i.e. leave the coal underground).

      • Luís says:

        I did not express any particular opinion – apart from the take on “cheap” coal and nuclear; I am expecting you to agree with me. But when you write things as:

        Wind in the UK / Europe seems to be doing little more than adding noise


        in the UK, distributed renewable energy means roof top solar

        I would expect you to back it with some substance.

        In various member states of the EU wind is providing more than 30% of the electricity consumed. And even in these member states the wind park is well distributed geographically. A wind farm itself must be distributed geographically to be effective – the larger the capacity of the project, the larger its implantation area. There over 1000 energy cooperatives in Europe, many of which own wind mills. And so on … the data is out there.

        • Euan Mearns says:

          Luis, I sometimes don’t understand the points of disagreement. I believe we are on the same page regarding nuclear and energy efficiency and so it is the renewables strand that is at issue. Here we both make the same mistake. You take small countries like Portugal and Denmark, both with access to large hydro balancing capacity and hold that up as a shining example which I feel is not scalable into the bigger countries. I take the UK where the system is now being balanced by curtailment payments paid for by the poor and reckon this is a bad plan.

          We maybe have different takes on what distributed renewable energy means. I take it to mean homes with renewables and batteries. I don’t regard a 250 MW off shore wind farm as distributed renewables. A farm with a 2 MW turbine is. If I want to own some renewable energy in Scotland then I buy shares in Scottish and Southern Energy PLC who own most of our hydro and a pile of wind turbines.

          A question maybe you can answer. Why is “distributed” as opposed to centralised generation such a good idea?

          • Jacob says:

            Exactly. A logical interpretation of “distributed” would mean: close to the consumer.
            Wind farms are “distributed” all over the country, and mostly in far away locations, where the wind blows hardest – that means – it is FAR from the centers of consumption in the big cities.

            You need to use doublespeak to pretend that wind farms are “distributed energy”.

            Besides – when wind is balanced by hydro (the best means of balancing it) it doesn’t reduce emissions…

          • Jacob says:

            On second thought: maybe “distributed” means – distributed globally. That is in contrast to oil and gas that are concentrated in the Middle East, Russia. etc. Wind is available in all countries.

          • dennis coyne says:

            Hi Euan,

            Your understanding of distributed is very different from my own. As Luis said the idea is geographically distributed wind and solar tied together by the grid. The U Delaware study showed how overbuilding wind power over a widely distributed geographical area could provide 90% of load hours at minimum costs in 2030 and 30% of load hours (and 60% of total KWh generated) today at lower cost for a large interconnect in the US. Four years of wind and electricity demand data were used in the analysis.

      • dennis coyne says:

        Hi Euan,

        Actually I was not saying you were not being objective. I called into question whether your implication that Hughes analysis was not objective because it was from the PCI. And wondered if only those who agree with Euan and Roger could be considered objective.

        People can disagree, while both being objective.

        I think by questioning the objectivity of others, which you clearly did in your post, you open yourself up to the same type of observation.

        Nobody can be completely objective, objects do not disagree, subjects do. Why don’t we leave it there.

        I agree that we should use nuclear power and CHP, I do not agree that we should not use wind and solar. That does not mean I am being objective, I do not see the argument for not using Wind and solar.

        Wind in particular can be overbuilt to provide 3 times average load and provide 90% of load hours (and 99% of total electric output) with a small amount of backup.



        ► We modeled wind, solar, and storage to meet demand for 1/5 of the USA electric grid. ► 28 billion combinations of wind, solar and storage were run, seeking least-cost. ► Least-cost combinations have excess generation (3× load), thus require less storage. ► 99.9% of hours of load can be met by renewables with only 9–72 h of storage. ► At 2030 technology costs, 90% of load hours are met at electric costs below today’s.”

  10. Jacob says:

    “distributed renewable energy”
    This is just words.

  11. Jacob says:

    From the department of “just words”: what is “efficiency” and how do you measure it?
    What is usually measured is a reduction in energy consumption. Calling this “efficiency” is an euphemism. Another possible synonym would be “poverty”.

  12. Ed says:

    You are correct, Jacob. We won’t voluntarily reduce our energy use, like we won’t reduce World population voluntarily. We are destined to burn all the fossil fuels we can get our hands on with a ERoEI > 3 or so. Then what ?

    Euan is a proponent of Nuclear, others are proponents of renewables but the thing is; the window of opportunity to build out a new energy source is small. If we don’t do it soon, this window will close; FOR EVER.

    Even if we do come to our senses in time and we do commit some of our remaining fossil fuel resources to build out Nuclear or renewables it will be pointless unless we also control our population numbers. For example, the UK population is increasing by 400,000 per year, negating much, if not all, of our yearly increase of energy production from renewables.

    The model (as ever and a particular favourite of this site, ha, ha) is Germany. Population growth is zero, I believe, and is making a credible attempt at building out it’s renewable energy production.

    Even if Germany is successful and manages to have 100% of it’s energy needs met by renewables, the next problem it must solve is how to maintain this infrastructure at a time when fossil fuels will be in short supply (50 years time) or non existent (100 years time)

    • Jacob says:

      “Then what ?”

      I’m no prophet, I don’t practice this art, so I have no answer, sorry.
      I’m extremely skeptical of anyone pretending to know what will happen in 50 or 100 years, when fossil fuels will run out. We can’t see into the future.

      I’m pretty sure the **current** renewables won’t play a major role in the future solutions. They don’t work, now, at the scale needed. That is not a prophecy, but a fact. Some major technological breakthroughs are required (eg: storage). What they will be I can only guess, but I won’t, because my guess would be worthless.

      • Ed says:

        You said “I’m no prophet, I don’t practice this art” and then go on to do just that in the second half of your comment. Ha, ha, your having a laugh.

        Are you seriously saying that fossil fuels won’t be in short supply in 50 years time or virtually non-existent in 100 ? You got to be kidding me, surely. I thought I was being conservative in my dates !!!

    • Euan Mearns says:

      Ed, I’m with Jacob here. I think it is dangerous to pretend we know what will happen in 50 or 100 years time and to try to lay plans now for that future we do not understand. It is only in the last decade or so that we have had the tools to gather data and to speculate about the future. Past generations were not able to do that although engineers like Jevons and Hubbert tried.

      The best we can do is to design our energy system to see us through the next winter and perhaps next ten years. That’s the way it has always worked. Future generations will do the same, making use of the best resources available when the time comes.

      FF are not going to run out quickly. They are going to become gradually more expensive and we will adapt and substitute accordingly. Too many organisations and individuals now believe they can tell the future. This has hidden negative impacts for us. For example over-stringent safety regulations on nuclear power, large FF power stations and decommissioning oil and gas fields. This makes all these energy sources more expensive – why are our governments trying to crucify us in this way? Being critical of safety standards is a very tricky issue. But to have affordable energy, we have to run some risks.

  13. Ed says:

    Fair enough, Euan, I don’t think you get it at all. None of my points were addressed. Ignored. You want to fudge along as we’ve always done.

    ps I love your “Past generations were not able to do that although engineers like Jevons and Hubbert tried.”

    so you are still calling Hubbert’s work into question. Unbelievable.

    • Euan Mearns says:

      Ed, here’s Hubbert’s view of the future from a few decades ago. Was he right or was he wrong? He called the timing of the peak in US oil production but got the volume totally wrong.

      Regarding population control in the UK – what do you suggest?

      • Ed says:

        He is most famous for calling the US peak production correct. However, more significantly, his techniques for analyses have been proved highly useful. (He made other contributions, outside his core area of expertise, of questionable value, granted).

        As regards population; is it a very difficult problem for Mankind. But we should be having a discussion about it, AT LEAST. Ukip in the UK are raising questions about immigration (appealing to more Nationalistic sentiments) but failing to realise the broader picture of controlling birth rates as well. The last politician to raise his head above the parapet about the issue was SIr Keith Josef, and look what happened to him.

        I would start by setting targets and then giving tax incentives to people who have one or no children. How about that?

Comments are closed.