Welcome to the age of diminishing returns

Friday, September 20, 2013

Plundering the planet: an update



This is a written version of a talk I gave at the meeting of the club of Rome, in Ottawa, on Sep 19 2013.


Ladies and gentlemen, in this short talk I'll see to give to you an update of the status of the "Plundering the Planet" book,  which, as you know, is a report for the Club of Rome. And, as many of you know, the German version of the book was published in June of this year, so that I am in the interesting situation of having published a book that I can't read! But we are working at the English version, which should come out early next year.

Now, let me summarize for you the situation that "Plundering the Planet" describes. You surely have noticed that the title doesn't say "developing the planet" or "improving the planet". No, it says "plundering", which means exactly that: We are extracting mineral resources as if we were pirates plundering the coffers of a just stormed galleon.

So, where do we stand with mining? Well, it is a long story. I can tell you that the United States Geological Survey, the USGS, lists 88 mineral commodities and that's already a very respectable number. But it doesn't include, for instance, fossil fuels in their several varieties (gas, coal, oil, tar sands, shales, and the like). Then, every commodity has different sources, different areas of exploitation, different grades of products; as I said it is not easy to extricate oneself out of the mass of data available.

Anyway, I can tell you that we are in what looks like a situation of stability in the sense that the production of some commodities is growing, while for others is declining but, on the average, we don't see dramatic changes. I can tell you that right now the largest volumes produced is for construction materials: sand, cement, rock and the like. That's also the fastest growing mineral commodity in terms of production. It is growing exponentially, showing no signs of decline. It escapes me why we are working so hard to transform this planet into a sort of spherical highway, but this is the way things stand. Among metals, let me give you a couple of examples: copper production is growing, while that of gold is declining - in general we don't see dramatic changes for this category. If, then, we look at fossil fuels, the production of liquids (oil and other fuels), gaseous and solid (coal) fuels is weakly increasing on the average. But, of course, I have no intention to go through all the 88 commodities one by one. Let's say, as I was noting before, that we seem to be in a relatively stable situation - no decline on the average, but no rapid growth either.

The sensation, however, is also that we stand on the edge of a cliff and there are several factors that provide you with that sensation. The first one is prices. You see, there was a trend of price reduction that had been going on for at least a decade and everyone had noticed that: prices are going down, therefore there is no depletion problem. And then, starting with 2004: bang! We hit a vertical wall; prices have gone up and show no sign of going down. On the average, the price of such commodities as metals, has increased of a factor of three and that's not a negligible amount. Depletion does play a role in this, because it forces us to extract from lower grade resources.

If we then look at fossil fuels, you know the trend for the most important one: oil. Prices have increased of a factor of 5 in comparison to what we had about ten years ago. We are now consistently floating over 100 dollars per barrel. If you had said ten years ago that we would arrive to these levels, they you would have been considered a total madman (I remember that I said something like that at that time, but let me not go into the details.)

High prices are not the only problem with fossil fuels. There is the problem that we are succeeding in keeping production constant or increasing by means of the addition of liquids, such as biofuels, that contain less energy per unit volume than conventional oil. So, what we call "a barrel of oil" in 2013 contains less energy, on the average, than it used to contain ten years ago. And then there is the problem of net energy: depletion is forcing us to use more and more difficult resources and we need to use more energy to produce the same amount of energy. So, we are left with less energy that we can use for other purposes. And, finally, we have the fact that the economies of producing countries are growing and they tend to consume more for their internal market and export less. So, there is less oil available for non producing countries, which includes many Western countries.

So, you see, the situation can be described as very difficult. It is true that we can fight depletion and we have been doing that successfully, up to now. But it is a battle that we have won at a very high price (and only for a limited period of time). Apparently, however, we are willing to pay any price for oil, even at the cost of renouncing to a number of things that, once, were taken for granted, such as public health care, social security, public transportation, and the like.

It is a choice that we made and that we may well regret in the near future because we are not only beggaring ourselves but creating a much worse problem: a true climatic disaster. As depletion is forcing us to consume more energy in order to produce energy, the final result is that emissions are growing and they show no sign of abating.

Up to a few years ago there was a debate on whether peak oil would have saved us from ourselves. That is, if the "natural" decline of the production of fossil fuels could have caused a reduction in emissions and that would have solved the climate change problem. That debate is by now over: peak oil is not going to save us. It is arriving, but too late to stop catastrophic climate change.

In the end, the world's economy has been following quite closely the basic scenario that "The Limits to Growth" had outlined already in 1972. In a way, it is a triumph for the Club of Rome which had sponsored a study able to predict the future with such an accuracy. And, in the same sense, it is a monumental failure because we haven't been able to do anything to avoid the dire future we ourselves had been predicting. You know, it is like one of those nightmares where you are chased by a monster. You see the monster, you want to run away, but you can't. 

Yet, the first step to solving a problem is to understand it and the "Limits" study gave us the tools we need. And not just that: it gives us the tools needed to actually solve the problem. You see, what are trying to influence is a complex system: the world's economy. Complex systems have ways to oppose changes: it is the result of internal feedbacks that tend to stunt attempts from outside to budge the system from its stable condition (intended in a dynamic sense). So, attempts to change the system by brute force either don't work or they succeed in wrecking the system, which of course we don't want.

The way to steer complex systems is to identify their "leverage points" or "critical points": intervening on these levers it is possible to change things, it is a concept that arrives to us from Jay Forrester and Donella Meadows, respectively the originator and one of the authors of the "Limits" study. If we examine our present situation, it is clear that the leverage point, the critical point, is one: it is fossil fuels. We need fossil fuels, otherwise it wouldn't be possible to keep alive seven billion people on this planet, but unfortunately it is also true that we are wrecking the planet by burning fossil fuels. So we need to burn fossil fuels but we cannot burn them: it would seem to be a classic "no-win" situation.

The point is, however, that we don't need fossil fuels. What we need is something that fossil fuels provide: it is energy. And energy doesn't necessarily need to be produced using fossil fuels. So, the way of pushing the lever in the right direction is clear: if we can't stop and at the same time we can't continue, we need to use fossil fuels to replace fossil fuels,

That is, we need to use fossil fuels to produce the renewable plants that will replace fossil fuels (it may also be said about nuclear energy, although of course there are big problems with that). If we decide to do that, then there is a chance to solve the problem before it is too late. With a sufficient amount of clean energy we can keep our infrastructures functioning, keep alive seven billion people, and we can also keep mining; at reduced rates, of course, because depletion remains a problem. And we can't hope to continue our wasteful habits as we have been accustomed to, up to now; We'll need big changes in the way we do things: we'll have to be more efficient and way smarter. But with clean energy we can still supply the industrial system with minerals for many years and gradually adapt to a future less commodity-hungry industrial system. But we must do that fast and decisively: otherwise it will be too late.

So, this is the way I see the situation and I'd like to close this short presentation with a quote from William Stanley Jevons, who can well be said to have been the precursor of "The Limits to Growth" study. Already in his times, mid 19th century, and even before computers, he had very clear in his mind the dynamic factors of the problem and the crucial need for energy. So, here it is - he was actually speaking about coal, but I replaced the term "coal" with energy - Jevons would surely understand if he were with us today. For the problems we are facing, there are no miracles, no tricks, and no shortcuts: what we need is clean and abundant energy.

(from "The Coal Question", by William Stanley Jevons 1866)

Energy in truth stands not beside but entirely above all other  commodities. It is the material energy of the country — the universal aid — the factor in everything we do. With energy almost any feat is possible or easy; without it we are thrown back into the laborious poverty of early times.



15 comments:

  1. Ugo,

    nice post, of course! And how about this? Do WS Jevons a favour and make a conclusion:

    "Give people cheap and abundant clean energy, and they will destroy everything else."

    Cheers,

    Alex

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    1. Alex, if you allow me to disagree, I think that people destroy things so ruthlessly because of scarcity, not because of abundance!

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    2. Ugo,

      of course we can disagree. My concern is echoed by e.g. Ted Trainer.

      What I meant is that if we hypothetically find a way of cheap and abundant energy (without collision with climate), that would mean that human population would grow even further (and not only because I think that equation more wealth ==> less children argument is nonsense).

      To put it differently. Wasn't it Industrial Revolution which gave us cheaper and more abundant energy than ever before in history (and also the ability to deplete all the other stuff (forests, oceans, minerals, etc.))?

      How would such an extension solve the problems of depletion of other resources, which would be speeded-up, if we would have cheap energy?

      That is my concern.

      Best, Alex

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    3. Alex, if we think that human being should still take a role on this planet, I think we have to see this role in terms of a relative prosperity. There is nothing more destructive, I think, than a hungry man and peasant societies are always on the edge of starvation. In these conditions, you can't save the trees, worry about conservation, save non human creatures. Historically, societies with little or no surplus have been the most destructive. So, I think that if we have a surplus - call it "prosperity" - then there is a chance to give some space on this planet for non human creatures, for wilderness, and for beauty. Have you noted how concerns for the environment go down with poverty increasing? So, I think we can be fully human only if we have a good surplus.

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    4. And about your final point, Alex, I was just writing about that in my post about decoupling

      "In my view, renewable energy is a prerequisite for decoupling - if we have clean energy, we can truly decouple and we'll even be forced to do it because not even cheap energy can create the minerals that we have dispersed all over the planet. But, without energy, there will be just less and less cake for everybody. "

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    5. Ugo,

      poverty is a truly terrible thing, we all are trying to escape it (we are all afraid of dark and cold!), I guess. I know that when people are truly poor, they dont care too much about their supportive environment.

      I surely don't want to throw people into poverty, I would rather like to see people stop overconsuming, overeating, overtravelling, etc. But where is the "border" for overconsuming?

      As for decoupliing, I am going to read the next post and comment there ;-)

      Alex

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  2. Very good post Ugo and your conclusions certainly seem right to me. "We need to use fossil fuels to replace fossil fuels". Though as I am sure you would agree a few other things also need doing. The mobilization of actors agenda for the definition and implementation of what needs to be done, is vast and complex and at present seems to be lacking effective and sustained leadership whether top down or bottom up. I hope this latest Club of Rome meeting will tackle this specific issue squarely and perhaps help the world make some faster progress. I think most would agree that time is running out, if it has not run out already. best, Max

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  3. I agree with Alexander. Another way of putting it is that carry capacity acts as an "ecological magnet" that will draw human numbers and consumption toward it.

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  4. At first blush, “Use fossil fuels to replace fossil fuels” could appear to resemble “We must destroy the village to save it.” Correctly, however, it is a warning and an instruction: “Do not eat your seed corn.” We plant our seed corn to harvest more corn; by analogy, we «plant» fossil fuels to «harvest» clean and renewable energy.

    Dr Bardi, you mention the need to husband our goods and produce. (I continue to take the liberty of attempting to restate your observations by analogy to farming.) I feel that this is absolutely essential; civilization cannot continue to be so wasteful as we have accustomed ourselves to consider normal. An example: here in Chicago (where I presently live), people complain about how small the closets are in what have always been middle-class houses and apartments. It never occurs to today’s people that just a few generations ago, even the economically fortunate people did not have as much clothing as do even the «financially challenged» of today. My middle-class great-grandmothers and my working-class great-grandmothers alike had to be able to mend clothes; today, hardly anybody would even consider mending clothes.

    What our society needs to realize is that if we continue to party like there were no tomorrow, there won’t be.

    David Collins

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    1. David
      While I agree with your sentiments - and we in Britain have gone from my parents' hope for 'a sufficiency' to a belief in expanding 'modernisation' - the actual 'on-the ground-experience'- in the USA 'middle class 'has been somewhat different from the supposed storyline. Elizabeth Warren's careful quantitative analysis for the Mom & Pop and 2 kids unit since the 1970s is worth taking notes from. That she gave the lecture in 2007 as the financial crisis was looming makes her lecture even more worthwhile in my view: http://grad.berkeley.edu/lectures/event.php?id=104&lecturer=102

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    2. Thanks, David. A very good way to express my point. I'll reuse it!!

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  5. Professor Bardi--

    I hope you found/will find the time to see some of the sights in Ottawa (Parliament Hill, Gatineau Park, the Rideau Canal, the museums: oh, and for eating out food is better and cheaper on the Quebec side of the border).

    You may know that Canada exists today solely because of the European interest in the beaver fur trade, and I have often thought that the story of its rise and fall (basically beavers were hunted to near-extinction near the trading posts, leading to greater and greater distances needing to be travelled to obtain furs, but the greater distances meant the profit margin was reduced, and when those beavers were exterminated and you had to go even further afield to obtain furs, said profit margin became ever thinner...and so on...) offers a disturbing parallel to what you are describing.

    It seems to me we Canadians (plus a few others: Icelanders, Norwegians come to mind) may well end up as the "last first world economy standing": a majority of our electricity is produced with hydro-electricity, which involves large reservoirs, which in turn considerably simplifies the task of ramping up renewables (any surplus power generated by solar and/or wind can be used to pump more water behind a hydro dam, where it can be used whenever needed). Condering how (criminally!) wasteful of energy we are now, it seems to me that we could become wholly self-sufficient in energy with Swiss or Scandinavian levels of consumption (not the future we dream of today, but not a snow-covered variant of a Mad Max world either). And whereas today much of this cheap electricity (in British Columbia and Quebec especially) is used to smelt alumininum, I could easily see it being used a generation hence to melt, purify, and thus extract useful materials out of imported garbage/wreckage/scrap metal (something like John Michael Greer's "scarcity industrialism")

    Does this make sense, or do you think this is just wishful thinking on my part?

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    1. Thanks for this note, Etienne. And, yes, I did allocate a couple of days to see Ottawa and the area around. I know that I have been using quite a bit of fuel for this trip, but I think it is not my traveling that is wrecking the planet. So, I saw Gatineau, the Rideau canal, and had one very nice dinner in a restaurant in Quebec!

      About the future of Canada, I was wondering myself. On one side, there is still plenty of land per person and those large hydroelectric resources are a big asset. On the other hand, I was also thinking that climate change is ramping up temperatures in the Northern regions more than in equatorial ones. So, Canada will warm up relatively much more than other regions. As a consequence, the changes in the ecosystem may be very large and unpredictable - not likely to be good.

      I think Canada has some of the same problems that I saw in Siberia: my Russian friends sometimes tell me something like "Oh, with climate change we'll be warmer and that's good!" Then I tell them "have you considered what's going to happen when the permafrost melts?" Ahem......

      Better to be in Canada than in Italy, though!

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  6. Professor Bardi--

    Thank you so much for your reply. Glad to hear you found the time to visit the area. A pity the conference wasn't a month from now: the fall here and in Southern Québec is truly spectacular when the leaves turn yellow, red, gold and every shade of color in between...

    The impact of climate change is being examined by some: have a look at the studies and links at www.ouranos.ca (Ouranos is a scientific consortium involving Hydro-Québec and a number of partners). Their basic conclusions are cautiously optimistic: precipitations in Québec are expected to remain unchanged or to increase (with 96% of the electricity of Québec being produced by Hydro, this is a rather important point), and they anticipate that winters will grow warmer, leading to overall lower electricity consumption (a peculiarity of Québec being that a majority of homes use electrical heating, which does wonders for air quality) without increased use of air conditionning in the summer compensating for this trend. So the next few decades may be rough without being catastrophic, for Québec (and hopefully the rest of Canada) at any rate.

    (Disclaimer: I am merely an interested layperson and am quite unaffiliated with Ouranos or anyone there).

    There was a French-language humor show in the nineties (basically a parody of STAR TREK and similar shows) called DANS UNE GALAXIE PRÈS DE CHEZ VOUS, which follows the adventures of the crew of a starship seeking another planet for humans ("six billion twits", as they put it) to migrate to (global warming having destroyed this one): this ship was sent out on a United Nations mandate which was carried out by the last superpower left on Earth: Canada.

    The more I read about Peak Oil, Climate Change and related phenomena, the more I suspect/fear that the writers of this show may have come closer to what the future will bring us than 99.9% of "serious" publications...

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  7. "And, as many of you know, the German version of the book was published in June of this year, so that I am in the interesting situation of having published a book that I can't read! "-UB

    Take a lesson from Werner von Braun

    ""in german oder english I know how to count down,
    Und I'm learning chinese," says wernher von braun.-Tom Lehrer :D

    http://www.youtube.com/watch?v=5V7me25aNtI&feature=player_detailpage

    Time to learn to count backwards to ZERO.

    RE

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