Peak Oil's Ancestor: the Peak of British Coal Production in the 1920s
By Ugo BardiASPO Newsletter n. 73
Dec 10, 2006
Figure 1. British coal production from 1815 to 2004. The data from 1815 to 1860 are from Cook and Stevenson, 1996. The data from 1860 to 1946 are from Kirby 1977; the data from 1947 up to present are from the British Coal Authority (accessed 2006). The production data are fitted with a Gaussian function which approximates the Hubbert curve.
We are just a few years away from Peak Oil; the moment when the worldwide oil production will start an irreversible decline. What should we expect to happen at the peak and afterwards? History is not a direct guide, since there are no past cases of an important global commodity, such as oil, peaking.
However, there have been regional peaks which had global effects. The best known case is that of the US oil production that peaked in 1970 which brought the first great oil crisis in the years that followed. But that was not the first case of a major resource peaking and declining; there was another major peak almost half a century before: Peak Coal in Great Britain, in the 1920s.
The geological past left to Great Britain an endowment in coal unparalleled in any other region of Europe. Exploitation started in the Middle Ages and, already in early 18th Century had become an exponentially growing industry. Coal fuelled the British industrial revolution, and was also connected to political power, allowing Britain to construct the first, and so far the only, truly world empire in history.
The importance of coal is hard to over-estimate. During the period of expansion of the industry, a British miner could produce almost 250 tons of coal per year (Kirby 1977). Even taking into account that about 20% had to be used for mining more coal, the productivity of a coal miner, in energy terms, was hundreds of times larger than that of an agricultural worker. At the height of its empire, Britain employed more than one million miners (Kirby 1977). It was the superpower of the time, being challenged only by other coal-producing States. In the First World War, British coal fought against German coal: British coal won.
But coal couldn’t last forever, even for the richly endowed Britain. Already in mid 19th Century, William Stanley Jevons had predicted, in his The Coal Question (1856), that depletion would one day make British coal too expensive for British industry. Jevons did n’t state explicitly the concept of Peak Coal but, in a qualitative sense, his analysis was similar to that of Marion King Hubbert for the oil production in the United States (Hubbert, 1956). And Jevons had been right: the peak of British coal production occurred in 1913 with 287 M tons. The British coal industry struggled to maintain production but couldn’t reach that level again. The strain on the industry is also shown by the two miners’ general strikes of 1921and 1926 that caused a temporary fall of production. The downward trend became evident in the 1930s and could not be stopped.
The British production followed a classic bell-shaped curve in good agreement with Hubbert’s model, with a best fit of the distribution giving a peak in 1923, only ten years after the actual maximum. Today, coal production in Britain is less than one tenth than it was at its peak.
The peak of the British coal production was a turning point in history; never before had a major energy producing region started its decline. There are impressive analogies for the case of the British Coal Peak of 1923 and that of the American Oil Peak of 1970. In both cases, these countries were producing at peak about 20% of the world total. In both cases, the worldwide consequences were important. Before the peak, Britain was exporting about 25% of its domestic production, and this amount had been growing exponentially together with production. After the peak, exports started to decline causing a shortage of the coal in the world market. In the case of the US, oil exports were not important before the peak. But, after the peak, the US oil imports soared rapidly, leading also to a shortage in the world market.
The oil shortages in the 1970s gave rise to the price spikes causing the Great Oil Crisis. A similar spike took place in the 1920s for coal (Australian Gov., 2006) although it was less pronounced. Most likely, the coal spike was less abrupt because the price controls that had been put in place during the war were only slowly relaxed in the 1920s. Coal prices stayed high in the 1920s, but fell with the market crash of 1929.
Many regions of Europe depended on British coal, so the lack of coal was felt everywhere. Several events that followed the British coal peak may be related to the reduction of the availability of energy: the decline of the British Empire, the Great Depression of the 1930s, as well as the general political upheaval of Europe in the 1920s and 1930s. The Italian newspapers of the 1920s and 1930s are full of insults against Great Britain for not sending to Italy the coal that Italians felt entitled to have. It reflects the kind of attitude that western countries adopted against the Middle East oil producers in the 1970s. But, if British coal was dwindling in the 1930s, German coal was still on the increase; its peak would only arrive in the 1940s. Germany never produced as much hard coal, namely the best quality, as did Britain, but in the 1930s it had the advantage that it could still increase its production, whereas Britain’s was declining.
In the 1930s, Italy abandoned her traditional ally, Britain, for Germany because only Germany could provide the coal that the Italian industry needed at a price that Italians could afford. Only later on, would they realize that the price of German coal was to be much higher than it had seemed. In the 1950s, after the turmoil of the Second World War, the problems caused by the British coal peak were solved ― for a while ― by switching to oil. Likewise, after the turmoil of the oil crisis of the 1970s, the problems caused by the US oil peak were solved ― for a while ― by switching to other productive regions. In both cases, neither the public, nor the politicians, nor the economists saw the relationships between the political and economic events of the time which were related to the peaking of oil and coal production.
In the 1930s, whole books were written on coal (Neuman 1934) but the word depletion was hardly mentioned. In 1977, Kirby wrote more than 200 pages on the history of the British coal industry during the peak period without ever mentioning the question of depletion. Apparently, people could not grasp why, while there was still coal to be extracted, production would decline. They didn’t understand that it is not physical availability that counts, but the cost of extraction that increases with progressive depletion. It was a concept that Jevons had already understood almost a century before but had not survived in mainstream economics. The case of the US oil peak was similar; peaking was generally ignored by economists, even though Marion King Hubbert had predicted it correctly. All that happened afterwards was attributed to political causes. Both peaks were soon forgotten.
Today, it is global oil production which is peaking. It is something we are all seeing, but it is not politically correct to mention the fact. Peaking is a momentous event, but it hints at a reality that most people would rather ignore: the finiteness of mineral resources. We may well ignore the global peak, too, just as most people ignored the British coal peak of the 1920s and the US oil peak of 1970. Yet, we won’t be able to ignore its effects.
References
Australian Government, the Treasury, 2006 (accessed)
www.treasury.gov.au/documents/1042/HTML/docshell.asp?URL=02_Resource_commodities.asp
Coal Authority, 2006 (accessed) www.coalminingreports.co.uk
Cook, C and Stevenson, J. 1996. The Longman Handbook of Modern British History, 1714-1995. Longman 3rd Edition. London and New York:
DOE 1993, DOE/EIA-0572 Report,
Hubbert, M.K. (1956). Nuclear Energy and the Fossil Fuels. Presented before the Spring Meeting of the Southern District, American Petroleum Institute, Plaza Hotel, San Antonio, Texas, March 7-8-9, 1956
Kirby, M. W., 1977 The British Coalmining Industry, 1870-1946, The Macmillan Press Ltd, London and Birmingham.
Neuman A.M. 1934 Economic Organization of the British Coal Industry; Routledge.
