17 Jan 2011, 4:02pm
peak oil:
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11 comments

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  • Energy costs are doubling every five years. Adapt, don’t whinge

    I was dismayed to read the right bunch of whingeing petrolheads at the Torygraph whining about how dreadful the government was for putting up fuel tax and spoiling their right to live miles away from work in the country and drive everywhere. The idea that the Government should reduce fuel duty for rural residents sounds truly cracked to me.

    In the years to come, rural areas will have to learn to become more self-sufficient and produce more of their needs locally, or they will depopulate to the cities. Government help, if any, should be targeted to assisting communities become more resilient, locally self-sufficient and self-reliant. Pouring our last resources into subsidising an unsustainable rural living pattern is the very last thing we should be doing.

    It’s not so much that that the petrolheads are wrong, the government probably does tax fuel too much without having a good reason other than that it’s easy to tax and hard to avoid. My beef is that these guys are fiddling while Rome burns.

    The cost of fuel is doubling every five years. This is because the amount of oil extracted from the ground has plateaued

    Oil production is flattening out

    and the second thing that is happening is that there are a lot more potential consumers lining up to split this limited amount across. The burgeoning middle classes in China and India, would also like to live in the attractive suburbs and drive to work, like us. A fixed supply distributed to an increasing demand usually results in increasing per unit prices, shaking out the poorer customers who get to do without, or use something less desirable instead.

    Berlin, car with Wood Gas generator

    There are alternatives to oil, and yes, they were used in the war on both sides by those too poor to afford petrol. The Torygraph petrolheads' modern engine management units won't appreciate it though.

    So there’s really no point our Telegraph users whining about it. For sure, it’ll help them feel better, but here is what they need to be doing, as intelligent adults:

    Examine how much they are spending in petrol to get to work. Then double it. That is what they will be paying in five years time. It has nothing to do with the government, and everything to do with too many customers and a less elastic supply. You can’t fight the market. If paying twice as much for getting to work is too much, then you have choices. Something has to change in the next five years. Effective choices include:

    Reduce the travel distance

    • move closer to work
    • work closer to home
    • work from home half the time (this option works badly with public transport season tickets which aren’t set up for that)

    Change travelling mode

    • car share – one to two passengers buys you 5 years, fill the car with 3 coworkers buys you 10 years of rising fuel costs
    • get on your bike
    • use a motorbike
    • use a moped

    Or economise in other areas of your lifestyle and shift resources to pay for your journey to work

    • holiday every other year
    • eat out less
    • take Tarquin out of public school
    • ease back on Mum’s taxi miles for Jemima’s afterschool activities
    • walk Tarquin and Jemima to school – it might be better for them too
    • live more frugally
    • work longer/harder to earn more so you can work longer/harder (funny old world, eh?)

    All of those are effective options. Ranting about the government tax being over 60% or the cost of petrol isn’t going to help. Petrol is taxed highly because we demand the government does a lot for us, which costs money. It needs to finds ways to raise that money that are hard to evade. he only effective way to evade petrol tax is to use less of it. Fuel costs are going to go up independently of that taxation.

    The same applies to fuel usage at home. Look at your power bills. If doubling them is too much, effective responses would be

    • reduce electricity consumption
    • insulate the home better
    • avoid using electricity for space heating
    • get more diverse heating sources
    • consider alternatives to fossil fuels – wood and biomass
    • consider heat pumps
    • consider living with more people to share costs
    • move to a smaller home
    • move to a more energy-efficient home

    Ineffective responses include

    • whining that it’s all an oil company company conspiracy
    • saying since you rent you have no choice – you may need to move….

    These increasing fuel costs are coming our way whether we like them or not. It appears the great mass of Western consumers hasn’t realised this yet, and choose to believe it is their government’s fault for the increases they have observed. That means those of us whose minds have not been infantilised by consumerism can make some changes, selling our fuel-inefficient lifestyle choices to mugs who don’t spot the downside yet, and buying enrgy-efficiency before the market starts to jack up the prices because it is a sellers market.

    Oh and if you don’t believe energy prices are doubling every five years, take a look at this

    electricity costs have gone up 100% between 2003 and 2009

    I paid the same amount for electricity in 2009 as I did six years earlier. I halved my usage from over 7MWh a year to a little over 3MWh/year, so the cost of electricity doubled. Increased energy costs are here already. You can run. You can moan. You can whinge. But you can’t hide, so either do something effective, or be financially destroyed. Yes, it will reduce your material standard of living. Your choice is to have influence over what part of your standard of living gets reduced, or whether you are just going to sit back and let whatever happens happen to you. Obviously, if you work for J.P. Morgan or Goldman Sachs, you don’t have to give a damn. But if you’re an ordinary Brit, you have to ask yourself whether you shouldn’t be giving this some thought. After all, it worries me, and I am not in the lower 50% income bracket…

    I agree that a lot of people waste a lot of energy, and need to reduce their consumption.

    And they would rather whinge about price rises etc than look at their consumption levels and work out where to reduce them.

    The thing I find a lot when meeting people like this is that they are incredibly lazy, driving places when they should walk, relying on others instead of doing things themselves.

    The sooner people like this are brought down to earth the better I feel.

    Something I thought I would highlight is that there is a small amount of research that shows that oil is infact renewable, it’s hard to find information but here’s one link to one of a few articles on it http://www.canadafreepress.com/index.php/article/3952

    You’ve nailed some of the issue on

    > driving places when they should walk

    or if they’re in a hurry that’s why the humble bicycle was created, leastways for flat places like Suffolk. Most shopping etc is easily within 3 miles…

    I’m not personally that fussed on AGW but the price signal we’re getting on the oil issue ain’t good, wherever it comes from.

    The article doesn’t say how long it takes for the allegedly newly produced oil to work its way up from the 13km the Russians have apparently drilled to the 4.5km we consider deep drilling.

    It’ll be hellaciously more expensive to drill the extra distance, and it would also be harder to find where to drill these expensive holes if we have to remote sense across three times the distance too.

    I’m not always the greatest fan of the free market, but it doesn’t usually support conspiracies over decades where there is a multiplicity of players like the oil biz.

    I’m more than happy to be shown wrong though, I’d quite fancy doing the extra travelling once I retire which at the moment I probably won’t be able to afford the fuel for…

    18 Jan 2011, 1:32pm
    by Marky mark


    Er, we live in the country – and drive a 4×4 to boot – but we got in to the habit of filling up at the cheapest petrol station on our way to work when the tank was about half-empty.

    None of that running around on vapours desperately trying to find a petrol station open for me thanks, you ever tried bump starting a four-wheel drive??

    Seriously though, this is about taking responsibilty for your actions – a common skill that seems all but extinct these days. We knew we would have to make lifestyle changes moving to the sticks and have ‘sucked them up’, as I believe the saying goes.

    We’re lucky there’s a school there for Junior, but everything else has to be shipped in by ourselves, but it’s a price we are willing to pay for the lifestyle.

    @MM hey, though I’m a townie I wasn’t having a general rural rant :) As you say, you have factored in how to get your fuel costs at town prices. People like you who adapt to changing conditions will do well, and probably eventually set up the enterprises that will make rural living work in the 21st century when the Tesco distribution hubs are rusting hulks.

    As fuel goes up, I reckon you will get together with your neighbours to pool visits to town/shops etc, and as it continues to rise eventually we will see villages return to some degree of local businesses/self sufficiency holding some general stores in bulk more locally.

    Just as the old village general stores and auto repair places used to do before the just-in-time hub-and-spoke model of Tesco fuelled by cheap oil ran them out of town. Villages were able to school their kids locally too. There are precedents for these things in the past, where transportation was more expensive. You food will be a damn sight fresher though more seasonal too, heck it might even taste of something if it hasn’t been cold stored for weeks in a modified atmosphere.

    Government support for rural fuel prices will simply delay the inevitable relocalisation; that change has got to come. In some ways a more localised physical infrastructure combined with modern communications and possible working from home will return much of what had been good about rural locations before they became dormitories while keeping some of what’s good about modern living.

    I’ve no disagreement with the idea that energy costs must rise in the long term, but I’m going to nitpick about some of the details.

    >The cost of fuel is doubling every five years.

    Well, yes, but the immediate past is no guide to the immediate future in any commodity (there is too much speculation) and the general spikiness makes for difficult short term predictions.

    >This is because the amount of oil extracted from >the ground has plateaued.

    Possibly, but more could easily be extracted. Peak oil, in my view, is as much about lack of demand as lack of supply. OPEC and Russia can easily raise production and there is a lot more to come from Brazil and Iraq. However, I fully agree that future energy sources will cost more to exploit, even with shale gas.

    Re the juice, I only have records going back three years and my annual consumption has remained steady in that time at about 3.2 MWh. Charges have risen 6% in that period. I have just changed supplier, so I think I will get a temporary reprieve. In the UK as a whole electricity supply has fallen over the past five years from 406 TWh to 379 TWh, a fall of nearly 7%. However, it will probably pick up a bit in the future. Moreover, electricity accounts for only a small part of energy use.

    Out of interest, what caused the big consumption rise in 2006? Left the phone charger on for too long? :-)

    @SG what caused the big consumption rise in 2006?
    the suckout in 2005 :) I changed supplier and the batching pushed 2005′s load into 2006.

    Hwever, I am seriously impressed at your managing to run @3.2MWh p.a. I have fought hard to bring mine down to about the same, and given that there are only two of us compared to 4 of you, and you have kids who don’t pay the bill so not incentivised the reduce costs it is awesome. Or I am doing something very wrong!

    > is as much about lack of demand as lack of supply.

    I think the next year or two will tell us which, since all that offered load of China and India will be up for more supply, please… God knows they have the cash.

    I really, really hope you’re right. If you’re not, then most of my financial wealth is about to go down the Swannee as peak oil will destroy capitalism and the continuous growth model. And I’m a greedy SOB and want my financial investments to do well and my pension to still exist in a decade’s time. My gut feel is that side of things is going to lose the fight by 2020, but I hope I’m wrong…

    Just double checked. 3259 units for the last four quarters which cost £415.97, I think (EDF bills are so opaque and I pay by DD).

    It seems that the mean UK household figure is around 4.7 MWh, so I don’t know why I’ve managed to get it so low. We do use a lot of CFLs and no electric heating, always use the washing machine at 30 degrees C, don’t watch telly much, gas hob but electric oven – dunno, really.

    Maybe you’ve got a greedy fridge/freezer? I don’t know how you would get comparatives, though.

    @SG I got insanely jealous when you said you had an electric oven. So I did a drains up and found my cock-up :)

    My spreadsheet aggregates by year, and in Sept 2009 I shot my duff Zanussi fridge freezer which was a power hog as described here. However, I failed to update my power usage spreadsheet, so that showed results rolled up as of Dec 2009, ie only 3 months of the new fridge.

    I ran the results to Dec 2010 and have updated the graph in this post, so I don’t have to feel so jealous now. I paid £228.97 for 1.69MWh Dec 2009 to Dec 2010. And despite switching lights off and even starting to switch off the DSL router at night I reckon most of the work was done by changing that fridge freezer, which has now probably paid me back most of its capital cost – by June I think I’ll be in the money :) Thanks for giving me the kick to clean up my data, it was the oven that did it! The graph even shows me why I bothered to switch to EDF as my average unit cost has dropped from 14p to 13.5p, though that change is dwarfed by the drop in consumption.

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