1.04.2005

Oil as A Renewable Resource

Matthew Yglesias has an interesting recent post on Jared Diamond's Collapse. In it he talks about the "energy crisis" as follows:

"Prima facie, then, there's a real question about how sustainable a form of civilization based on such fuel sources is over the long term. Technological improvements (easier fuel-extraction, more efficient fuel use, enhanced reliance on "new" renewables like wind and solar) may save us, but they also may not. People have a tendency to forget that wishing doesn't make technological progress happen."

He pooh-poohs other energy sources but misses a couple of points:

1. Oil is a renewable resource (in millions of years all the dead biomass on the earth today will be oil), I think there has been alot of recent debate as to how fast does it renew. That is, how much new oil is being created by the dead biomass of a million years prior? But I am willing to concede that we are consuming more than the earth is producing.

2. The real question is how much does each BTU cost to produce. Oil was around for a long time before it became a cost effective energy resource. As it becomes scarce, the cost will increase and make other sources of energy (solar, wind, nuclear) more cost effective.

Energy consumption is NOT a long term problem. The planet has plenty of means to supply it. Right now, oil, gas and coal are the cheapest to convert into the amount of BTUs needed to sustain world growth. As China and India become economic superpowers, they will a) compete for the scarce oil resources or b) turn to alternatives, as China is doing with nuclear power.

A sudden, radical shift in the common source of energy (in today's case oil) would cause some economic dislocation, but in the long term, energy production will no more be an issue than it is today.

I agree with Diamond: there is much to be concerned about, but energy production is not one of them.

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