Big Picture Policy Responses to Peak Oil

2012•06•18 Brendan FD Barrett Royal Melbourne Institute of Technology

Most policy-makers, it appears, are yet to wake up to the reality of peak oil. So to give them a nudge, this article presents four scenarios for how they might respond to the peaking of conventional oil production drawn from a range of reports by influential scientists, engineers and environmental groups.

These are big picture scenarios, identifying a course of action, rather than a specific set of recommendations (we will identify specific policy measures in a follow-up article). They are not necessarily mutually exclusive and are presented in the table below as: Revolutionary/Systemic change, Adaptation, Mitigation, and Do Nothing.

The main proponents of each scenario are also identified in this article. And although they may not have defined their work as actually being a response to impacts of peak oil, they could have been addressing another related issue like climate change or the promotion of renewable energy.


For the purpose of this article, we can ignore the Do Nothing scenario. That is business as usual. It is the situation that most countries find themselves in today and it is unlikely to have a happy ending without a phenomenal piece of good luck or some kind of technological miracle. Let us instead begin with the notion of revolutionary or systemic change.

Remake everything through a peaceful revolution

This scenario requires that we shift, across the entire globe, to 100 percent renewable energy sources by a specific date. Some scientists suggest that it is possible to complete this shift by 2030, others by 2050. However, the scientists promoting this scenario tend to agree that we need to phase out the use of both fossil fuels and nuclear.

One problem identified with this scenario is that it may not be possible to generate all the power we need with renewables based on the existing state of these technologies. As such, the proponents of this strategy propose that we reduce energy consumption by something in the order of 50 percent compared to today’s level through energy efficiency measures. The terms used to describe this are “power down” from Richard Heinberg of the Post-Carbon Institute and “negawatts” from Amory Lovins of the Rocky Mountain Institute. Negawatt is the amount of energy saved as a direct result of energy conservation/energy efficiencies.

But changing the energy supply system and becoming more efficient are not enough. This scenario also calls for a dramatic technological transformation with the introduction of smart grids, electric vehicle fleets, off-peak power storage (e.g., conversion to hydrogen fuel, or storage in batteries), and so on. Every house becomes a power station and every car becomes a battery. Electronic appliance manufacturers become electric car manufacturers, car companies build energy efficient homes, shopping centres become electric car charging points, and the list of changes goes on and on.

It is a complete shake up. But it will not be easy. Some businesses will win, while others will lose. The fossil fuel and nuclear energy sectors would continue to fight these changes through both intense lobbying of governments and concerted public relations campaigns. In relation to the former, while regulators are supposed to reflect the desires of the people who elect the politicians, in some countries such as the United States or Canada, industry lobbies frequently place pressure on regulators (via politicians) to resist changes they don’t like.

Two challenges with this scenario relate to how it will be possible to provide a stable renewable energy supply (overcoming the intermittent nature of wind, solar, wave energy) and how it would be possible to solve the liquid fuels problem for our existing planes, trucks and cars during the transition to a new technology stage.

Some of the key individuals promoting ideas similar to the Revolutionary/Systemic Change scenario include Jeremy Rifkin (The Third Industrial Revolution), Amory Lovins (Reinventing Fire), Richard Heinberg (Powerdown) and Mark Jacobson and Mark Delucchi (A Path to Sustainable Energy by 2030).

There are also some environmental groups that have put forward similar proposals including Greenpeace (The Energy [R]evolution) and the World Wildlife Fund (The Energy Report).

As an example, Jacobson and Delucchi argue that by 2030 we can reduce global energy consumption to 11.5 terrawatts (down from 16.9 terrawatts projected) and that this energy can be 100 percent renewable (41 percent solar, 50 percent wind and 9 percent water related). To achieve this, as an example, we would need to build 3.8 million wind turbines.

If we were to look around the world for places where this scenario is beginning to take root, then we can point to Sweden, Denmark and Germany and California in the US.

Adaptation Scenario – Enhancing our resilience

Most readers will be familiar with the term climate change adaptation and the goal of reducing the vulnerability of human and natural systems to the impacts of climate change. The peak oil adaptation scenario has a similar set of objectives, although the goal is to increase the resilience of economic and social systems to the impacts of oil production decline.

Under this scenario, both nuclear and renewable energy are promoted, while we are encouraged to reduce dependency on fossil fuels in order to avoid runaway climate change. However, the shift away from fossil fuels creates a huge shortfall in energy production that can only be addressed through massive technological innovation and investment.

For instance, inventor/engineer Saul Griffith in The Gameplan argues that by 2033 we can get 63 percent of our energy from renewable sources. This would help to keep the projected increase in global temperatures to 2 degrees Celsius. But to get there, Griffith calculates that over the next 25 years we would need to build one 3 gigawatt nuclear power plant every week, three 100MW steam turbines every day, twelve 3MW wind turbines every hour and 100 m2 of solar cells every second. This scale of development is enormous, but not beyond our abilities if we focus our industrial production systems on this goal.

The aim of this scenario is to maintain existing lifestyles, convenience and services, while shifting energy away from fossil fuels, reducing overall energy use and promoting a more equitable arrangement between the developed and developing world. This is often referred to as convergence whereby countries in the industrialised world reduce their energy consumption in order to give space for other countries to develop. We aim to converge at a certain level of energy consumption and CO2 emissions per capita.

The problem with this scenario is it keeps the nuclear option, thus ignoring the risk of nuclear accidents (which currently happen once every 10-20 years), and passes on the problem of how to deal with the radioactive waste to future generations.

Saul Griffith calls for greater energy literacy and a collective “power down” from a 11,000 watts to a 2,300 watts lifestyle for each individual (which also represents a powering up for many developing countries). In this context, his ideas resonate closely with those of the Switzerland-based 2,000 Watt Society and the Japan-based Low Carbon Society. The suggestion here is that you can maintain a very high quality of life at 2,000 watts per person.

So, yes, this scenario is beginning to gain traction in Japan and Switzerland. However, in view of the growing pace of renewable energy investment, it may also be possible to consider both China and India as converging in this direction.

Mitigation Scenario – An emergency response

Now we come to our fourth and final scenario. This scenario assumes that we have been too slow in responding to peak oil. It takes the 2005 Hirsch Report (Peaking of World Oil Production: Impacts, Mitigation, and Risk Management) as the starting point. The report by Robert Hirsch, perhaps the most widely known proponent of this scenario, argues that waiting until production peaks would leave the world with a liquid fuel deficit for 20 years. In his 2010 book The Impending World Energy Mess, Hirsch lays out the various emergency measures the world can take.

In this long emergency, in which we may indeed find ourselves at the early phase of right now, there are two kinds of measures required – administrative and physical. The former includes initiatives like carpooling, telecommuting and fuel rationing. The latter includes the introduction of fuel-efficient transportation, enhanced oil recovery from existing oil fields, conversion of tar sands to liquid fuels, as well as coal-to-liquid/gas-to-liquid operations.

According to Hirsch’s calculations, such measures would save the world the equivalent of 30 million barrels of oil per day (compared to the average of 80 million barrels per day we use right now). Effectively we would have a buffer/transition period over which time the economy would have to adjust to a world with less oil.

The effectiveness of these mitigation measures depends upon the speed at which oil production declines (normally between 4 to 6 percent per annum). Very high rates of production decline (around 10%) could over-run our ability to respond and push us towards collapse.

This scenario excludes the nuclear and renewable energy options because they only produce electricity and cannot help quickly with the transportation problem. For instance, it is estimated that it would cost US$5 to 10 trillion to replace the global oil powered vehicle fleet with an electric fleet over a couple of decades.

Unfortunately, this scenario completely ignores the impact on the environment, and the climate in particular. We would be encouraged to exploit every possible liquid fuel development option, regardless of how environmentally destructive they are. The tar sands of Canada come to mind here, in particular. At the same time, biomass to liquids are not put forward as part of the solution in this scenario mainly because they require very heavy subsidies.

In addition to the work of Hirsch and his colleagues, other bodies that promote scenarios along similar lines are the International Energy Agency and the United Kingdom’s Industry Peak Oil Taskforce.

Countries that appear to align with this scenario include the US, the UK and Canada (although it could easily be argued that they could be located under the Do-Nothing scenario as well).

All of the above

So where does your country stand at present? Which scenario applies? Perhaps the answer is “all of the above.” In some places it appears like a revolution is already underway; in others there is evidence of adaption or mitigation; elsewhere people appear blissfully unaware of the end of cheap oil and what it means.

Both the revolutionary/systemic change and the adaptation scenarios seem really interesting and progressive. But how much will this transformation cost? Greenpeace gave one estimate of an additional US$17.9 trillion in investment in renewable energy between now and 2030 in order to make their proposal a reality (this would be 60 percent higher than business as usual).

There are many good reasons to adopt these two proactive scenarios — creation of new green jobs, enhanced energy security, no more nuclear waste (in the case of the revolutionary scenario), reduced impact on climate and less likelihood of resource-based conflicts to name but a few. But we appear to lack the inspired national leadership that such scenarios require. We also lack a sense of urgency and the ability to negotiate a way forward with the current vested interests around fossils fuels and nuclear energy.

The end result could be to push us into the mitigation or the “Do Nothing” scenarios. The consequences of both appear very painful in economic and social terms to say the least.

Perhaps what we need is the further elaboration of these prospective scenarios in greater detail at all levels — global, national and local. We need more data and analysis. We need the development of convincing argumentation on how an energy revolution is possible and why it makes sense. We need political leaders who are firstly willing to get to grips with these thorny and complex issues, and secondly willing to commit to bring about dramatic changes. This is a fairly tall order, but it is not beyond us. We need all that now. Time is of the essence.

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Big Picture Policy Responses to Peak Oil by Brendan Barrett is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 Unported License.



Brendan FD Barrett

Royal Melbourne Institute of Technology

Brendan Barrett is a research coordinator at the UN Global Compact Cities Programme and hosted by Royal Melbourne Institute of Technology (RMIT). His professional career includes work in the private sector, academia and with international organizations. He uses the web and information technologies as a means to communicate, teach and undertake research on issues of environment and human security. Prior to joining RMIT he worked in the United Nations for close to 20 years with UNEP and the UN University (UNU). He is a visiting researcher at the UNU Institute for the Advanced Study of Sustainability in Tokyo, Japan, and a visiting associate professor at the University of Tokyo.

Join the Discussion

5 responses to “Big Picture Policy Responses to Peak Oil”

  1. BrendanBarrett says:

    Check out this video of Robert Hirsch talking at the most recent ASPO Conference. In the article above I mentioned that “The effectiveness of these mitigation measures depends upon the speed at
    which oil production declines (normally between 4 to 6 percent per
    annum). Very high rates of production decline (around 10%) could
    over-run our ability to respond and push us towards collapse.” These figures were taken from David Holmgren’s Future Scenarios.

    However, Hirsch argues that a rate of decline at 1% per annum is manageable, but a rate of 3-4% is “effectively catastrophic.” This makes more sense. Anyway, watch the video if you have time, it is very insightful.

  2. Richard says:

    Change is required there is no question however I get the distinct impression that all of this points back to big business again controlling everything from production to distribution. Follow the money and implementation as alternative systems are in place the consumer still foots the bill and pays exorbitant prices for energy while a few oligarchs sit back and control the polices and to ensure they make the most profit possible. No mention of any alternative energy production from the thousands of inventors that could simplify this even more as no study has been put forth especially from big media that we can look beyond the solar, wind, water production. Good article and well stated within the confines of our current energy (stranglehold) polices and heaven forbid we should mention something like exotic energy.

  3. Americans will be unwilling to accept the fact that their way of life is not going to go on for much longer.

  4. Veritas44 says:

    Guess that whole ” peak oil ” nonsense didn’t work out…

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