Don’t Count Oil Out
Alternative energies won’t replace oil, gas, and coal anytime soon.
Oil well and Storage Tanks
Photo by iStockphoto/Thinkstock.
This article arises from Future Tense, a collaboration among Arizona State University, the New America Foundation, and Slate. Future Tense explores the ways emerging technologies affect society, policy, and culture. On Oct. 19, you’re invited to join us for a Future Tense event in Washington, D.C., about the next era of energy. For more information and to RSVP for “What Will Turn Us On in 2030?,”visit the New America Foundation’s website.
It’s easy to pick the dominant environmental issue of the last decade. It has been the issue of climate change and what—if anything—the countries of the world can do to limit, or reduce, carbon dioxide emissions.
But during that same decade, global carbon dioxide emissions rose by 28.5 percent to some 33 billion tons. And by 2030, the International Energy Agency expects global carbon dioxide emissions to rise by another 21 percent to about 40 billion tons.
Carbon dioxide emissions will continue rising because hundreds of millions of people in places like Vietnam, Malaysia, and South Korea—and, of course, China and India—are transitioning to a modern lifestyle, complete with cars, TVs, and other manufactured goods. As they do so, they are using more energy. Specifically, they are using more hydrocarbons—coal, oil, and natural gas. And while lots of idealistic environmentalists and some policymakers argue that we should quit using carbon-based fuels and move to a global economy powered by nothing but renewables, the hard reality is that hydrocarbons are here to stay.
There are three reasons why hydrocarbons will continue to dominate the global energy mix for decades to come: cost, the slow pace of energy transitions, and scale.
Explaining the first issue is relatively easy. The global energy sector is by far the world’s biggest industry, with more than $5 trillion per year spent finding, refining, and delivering energy of various forms to consumers. Renewable sources like wind and solar have their virtues, but they cannot compare with hydrocarbons when it comes to economics. A recent analysis by the Energy Information Administration estimates that wind-generated electricity from onshore wind turbines costs $97 per megawatt-hour. That’s about 50 percent more than the same amount of electricity generated by natural gas, which the EIA estimates costs $63. Offshore wind is even more expensive, coming in at $243 per megawatt hour. The least-expensive form of solar-generated electricity—the type generated by photovoltaic panels—costs $210, or more than three times as much as the juice produced by burning natural gas.
If renewable sources of energy were dramatically cheaper than hydrocarbons, then perhaps we could be more optimistic about their ability to capture a larger part of the global energy mix. But even if that were true, a wholesale change in our energy mix will take a long time. “There is one thing all energy transitions have in common: they are prolonged affairs that take decades to accomplish,” wrote Vaclav Smil in 2008. Indeed, for 109 years after the signing of the Declaration of Independence, wood was the dominant source of energy in America. It wasn’t until 1885—the year that Grover Cleveland was first sworn in as president—that coal finally surpassed wood as the largest source of energy in the United States. Coal remained king until 1950, when it was deposed by oil. “And the greater the scale of prevailing uses and conversions, the longer the substitutions will take.” Smil, a polymath, prolific author on energy issues, and distinguished professor at the University of Manitoba, believes that while a “world without fossil fuel combustion is highly desirable … getting there will demand not only high cost but also considerable patience: coming energy transitions will unfold across decades, not years.”
Smil’s point can be proven by looking at oil’s share of U.S. primary energy consumption. According to the EIA, in 1949, oil provided 37 percent of America’s total energy needs. In 2009, oil’s share of U.S. primary energy stood at … 37 percent. Over the past six decades, uncounted billions of dollars have been spent on efforts to reduce our need for oil, yet petroleum has been remarkably persistent. Conspiracy theorists will, of course, blame Big Oil. But the conspiracy wasn’t hatched in Houston or Detroit. It’s a conspiracy of basic physics. Love it or hate it—and all of us love what oil provides even as we are continually taught to hate the oil companies—oil is a miraculous substance.
If petroleum didn’t exist, we’d have to invent it. Nothing else comes close to oil when it comes to energy density, ease of handling, flexibility, convenience, cost, or scale. Electric vehicles may be the celebrity car du jour, but modern batteries are only slightly better than the ones that Thomas Edison developed. Gasoline has 80 times the energy density of the best lithium ion batteries.
A final point on energy transitions. Believe it or not, in 2009, renewable energy sources had a smaller share of U.S. primary energy than they did back in 1949. Sure, wind and solar have grown dramatically in recent years, but in 1949, renewables—almost all of it hydropower—provided 9.3 percent of the country’s energy needs. In 2009, renewables—again, much of it supplied by hydropower—provided 8.2 percent of U.S. energy.
Robert Bryce, a senior fellow at the Manhattan Institute, is the author, most recently, of Power Hungry: The Myths of "Green" Energy and the Real Fuels of the Future.