On Monday 20th and Tuesday 21st of October, Barcelona, Spain hosts the seventh annual international conference of the Association for the Study of Peak Oil & Gas (ASPO). The programme is under the fold and includes papers from TOD staff Jérôme Guillet, Luís de Sousa and Ugo Bardi.

Most of The Oil Drum: Europe team will be there and we look forward to meeting you.

7th ASPO International Conference: Barcelona
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DAY ONE: Below Ground

DAY TWO: Above Ground. Renewables, Local Solutions and Social Issues

Every few years the UK Department of Trade and Industry, now Department of Business Enterprise & Regulatory Reform, publish a chart of the nation’s energy flows. Here’s the most recently published chart based on 2007 data:

Click for .pdf

It’s a nice, high level overview of energy in the UK illustrating the flow of primary fuels from the point at which they become available from home production or imports (on the left) to their eventual final uses (on the right). Flows at the bottom represent exports, conversion losses and energy industry and non-energy use. The yellow blocks represent transformation (power stations and refineries).
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The energy flow charts from 2001 and 2004 are also available from DeBERR: Energy Flow Charts.

A quick comparison between 2001 and 2007 reveals:

• Gas production down 32% with imports providing 29%, up from just 2%.
• Coal production down 47% with imports providing 73%, up from 54%.
• Oil production down 34%.
• Electricity from nuclear is down 33% however renewables have more than doubled.
• Small increase in oil use for transport, small decrease in gas use.
• Energy used in the iron and steel industry has fallen by a half.

The changes can be summarised in the following chart:

Source: DUKES 1.1 and 1.1.1

It is a dramatic change over a decade, even more so considering energy prices were low on the left side and high on the right. Currently the gap is met through imports. However with North Sea oil and gas production continuing to fall and with the future nuclear decommission schedule clear, it can only be matter of time until the growing gap can no longer be addressed by increasingly expensive imports.

UK domestic gas and electricity prices have increased dramatically in 2008:

PRICE INCREASES THIS YEAR

4 Jan – Npower: Gas up 17.2%, electricity up 12.7%

15 Jan – EDF Energy: Gas up 12.9%, electricity up 7.9%

18 Jan – British Gas: Gas and electricity up 15%

1 Feb – Scottish Power: Gas up by 15%, electricity up 14%

7 Feb – E.On: Gas up 15%, electricity up 9.7%

19 March – Scottish & Southern: Gas up 15.8%, electricity up 14.2%

5 July – EDF Energy: Gas up 22%, electricity up 17%

30 July – British Gas: Gas up 35%, electricity up 9%

21 Aug – Eon: Gas up 26%, electricity up 16%

21 Aug – Scottish & Southern: Gas up 29.2%, electricity up 19.2%

29 Aug – Scottish Power: Gas up 34%, electricity up 9%

29 Aug – Npower: Gas up 26%, electricity up 14%

Source: BBC News

This is a guest post by Adam Dadeby (Adam1). Adam is currently studying towards an MSc in Renewable Energy and the Built Environment

with the Centre for Alternative Technology in Wales, UK.

What is EROEI?

Energy returned on energy invested (EROEI or EROI) is a concept that mirrors the financial
metric, return on investment (ROI). In order to make an energy gain or “profit”, energy or
work must be consumed or exerted (Cleveland, C.J., 2001, p.1¹). The energy gain or profit
often referred to as “net energy”. EROEI is usually expressed as a ratio, or occasionally as a
percentage. EROEI can also be represented diagrammatically in simplified form (Fig. 1).

Figure 1: EROEI
(Charles Hall, Pradeep Tharakan, John Hallock, Wei Wu and Jae-Young Ko, Advances in Energy Studies Conference, Porto Venere, Italy, September

2002)²

The energy referred to in EROEI can be energy to run technology, such as liquid fuels for
transport or electricity for lighting. It can however refer to energy in a form that can be taken
in directly by living organisms: food.
[break]

How widely is EROEI-analysis currently used?

EROEI is understood by some of those campaigning on environmental issues, mostly those
who focus on fossil fuel depletion issues. The concept of EROEI has been defined by
Cleveland, Costanza, Hall & Kaufmann, (1984)³ and Odum (1996)⁴. However, within
society’s key decision-making mainstream – financial markets, governments,
parliamentarians and those advising them within the civil service and policy-making and
lobbying bodies – there is little evidence that the concept and significance of EROEI is
grasped or accepted. Instead they appraise different energy investment options applying
financial, political and environmental criteria. Environmental criteria usually encompass
climate change, local environmental effects and waste management. Where resource
constraints are discussed, the financial ROI is implicitly seen as an adequate proxy for EROI:
for example the remaining uranium reserve is usually described in remaining tonnes of
uranium which can be economically extracted at a minimum uranium commodity price ($US
per kg)⁵ using current technologies. Implicit in this is the idea that the financial cost and
technology are the key determiners of availability, rather than any physical constraints. Nate
Hagens, a former Wall Street hedge fund manager, has observed that the financial markets
do not understand net energy⁶. Peter Davies, Special Economics Advisor at BP, has also
stated that the net energy of an energy source is an irrelevant criterion⁷.

In addition, the decision-making mainstream has conducted energy policy on a predict-andprovide
basis: “energy needs” must be met (BERR, White Paper, “Meeting the Energy
Challenge”, May 2007)⁸. Energy efficiency has been encouraged since the oil crises of the
1970s and the industrialised economies now generate more wealth per unit of inputted
energy now than in previous decades. However, total energy use has increased over time as
the global economy has grown. Planned reduction in overall energy use, as a matter of
public policy, is not yet accepted because of the impact this would have on future economic
growth (Stern, 2003, p49)⁹. In the Department for Business Enterprise and Regulatory
Reform’s (BERR’s) May 2007 White Paper, there are 15 references to need to sustain
“economic growth”.

Measuring EROEI – system boundaries

While differences in philosophical outlook or ideological constraints may explain why EROEI
has largely been ignored by mainstream decision-makers, use of EROEI as a metric to
appraise energy investment options is also problematic for practical reasons.

Currently no established, globally agreed criteria exist to define the boundaries of an energy
system. What inputs should be counted as “energy invested”? At what point is the “energy
returned” considered to have been delivered as a useful output? The results of an EROEI
analysis and the conclusions that can be drawn from them are influenced strongly by the
boundaries used to define an energy system.

Energy returned
Where should the “energy returned” system boundary be drawn? How this question is
answered depends on the scope of the energy investment option appraisal. If the EROEI
analysis is limited to alternative methods of generating electricity for the national grid, the
“energy returned” should be in the form of electricity delivered to the consumer. If the
comparison is between methods of fuelling vehicles, the energy return should be in the form
of mechanical energy delivered to turn the vehicle’s wheels.

Energy invested
Energy has to be invested at all stages in the life cycle of an energy system. As with financial
accounting, some costs are directly associated with the activity. Others are overheads, which
are allocated pro-rata. Some of the costs may have no connection to the energy system but
have been incurred somewhere in wider society.

Example: a nuclear reactor (with examples of the energy costs that could be included)

Figure 2, click to enlarge

Even if a technologically simpler energy system were to be analysed, such as a series of
wind farms that generated the same net energy as the nuclear reactor, identifying and
quantifying the all of the most tenuous, indirect costs would soon become impractical.

It is clearly more feasible to identify and quantify direct energy expenditure: for example, the
energy cost of forging steel for a wind turbine tower, or the energy needed to transport it from
the factory to its operational location. When does an energy cost become an indirect
overhead? Perhaps, a portion of the energy needed to build and run the foundry and its
equipment; and maybe also a portion of the energy needed to train, feed, entertain and
motivate the foundry workers? The calculation would rapidly become very time-consuming
and prone to error. Ultimately, a slice of the entirety of the remainder of society’s activities
could notionally be apportioned to each energy gathering activity, giving all energy sources
an EROEI of 1:110. Clearly an EROEI which included all indirect costs, however tenuous their
association to the energy system, would not be a helpful tool for assessing how best to meet
society’s “energy needs”.

EROEI and the complexity of a society

So, if all the most tenuous, indirect energy costs of our global energy system were to be
included in an EROEI analysis, the global energy system would have an EROEI of 1:1. Does
this point to a more fundamental impact of EROEI on the nature of a society? Although
EROEI had not been codified until recent decades, from its first beginnings all life has had to
expend energy in order to capture energy from its environment: if a fox does not obtain more
energy from eating rabbits that it consumes catching them, it will not survive long; similarly
tulips, bacteria and humans. From the days of the earliest hunter-gatherers, the nature of
human societies has been governed by their success in capturing energy (primarily food
energy) at an energy profit¹¹.

The question of which factors determine the fate of different societies throughout history has
been addressed by Joseph Tainter and Jared Diamond. In The Collapse of Complex
Societies (Tainter, 1988)¹² and Collapse (Diamond, 2005)¹³ the authors examine the reasons
why societies of all sizes, from small isolated settlements up to the Roman Empire,
collapsed. Diamond identifies four reasons why societies collapse: resource depletion;
climate change; hostile neighbours; friendly neighbours. Tainter focuses on “energy gain”.
Societies that manage to achieve high energy gains from their energy systems develop
complexity, which have been characterised by large population densities; high levels of
occupational specialisation; steeper social hierarchies and increased inequality¹⁴ (Illich,
1974). As population densities and specialisation increase, the energy systems that sustain
them have to deliver more net energy. In doing so, they allow the population to growth further
and a still greater percentage of that growing population to become “non-productive”
specialists.

The EROEI of fossil fuels, which represented more than 80% of our total primary energy use
in 2004 (IEA, WEO 2006, p492)¹⁵, is declining¹⁶ (Cleveland, J., 2005, p.781) down to the
lower levels typically achieved by current renewable energy technologies. If, as appears
likely, we are moving to a lower EROEI or lower gain energy systems, the implications for our
society will be most profound.

Other physical criteria for assessing the practicability of energy systems

As we have seen above, EROEI is a metric that can describe much more than the technical
feasibility of an energy system. However, in a real world study or technical option appraisal,
there are several physical factors that would need to be considered in addition to EROEI:

1. Infrastructural requirements – the world is not a blank sheet in terms of energy
   systems. There is a lot of existing energy infrastructure. If a new energy system
   requires significant changes to the existing infrastructure, it means there will be a
   longer lead-in time, decades in some cases (Hirsch, R. et al, 2005)¹⁷, before the new
   technology starts to make significant contribution to the energy mix. For example, if
   the current energy system delivers liquid fuel to feed billions of internal combustion
   engines, a new energy system that delivers electricity for electric vehicles will only be
   able to replace the old system as quickly as existing liquid-fuel vehicles can be
   replaced or retro-fitted – a necessarily slow and costly process (financially and
   energetically). The energy costs of the infrastructural changes could be included as
   part of an EROEI analysis but the EROEI analysis would not be able to quantify the
   long lead-in times needed to adapt or replace energy infrastructure.

2. Energy density – the ability to store energy where space and weight constraints
   apply. Most energy for transport, particularly air transport needs an on-board energy
   store. The new energy system needs to produce energy in a form that can be stored
   with existing technology. The storage technology will probably require conversion of
   the energy, with consequent losses. This criterion could be incorporated into an
   EROEI analysis, if the storage process is included within the system boundary.

3. Location of resource (in relation to demand) – if the energy source is far from where
   it is needed, it may be impractical. This criterion could be incorporated in an EROEI
   analysis, if the transport process is included within the system boundary.

4. Scalability & rate of extraction – the rate at which the resource (whether renewable
   or finite) can be harvested will determine the maximum flow rate of energy that the
   energy system can deliver. Similarly, the size of the resource, together with the
   maximum flow rate, together will determine how big a contribution the energy system
   can make and, if the source is non-renewable, for how long.

5. Environmental impact – the extent to which an energy system impacts on the global
   and local environment has to be taken into account; this is seen most clearly in our
   use of fossil fuels and the effect it is having on the global climate. An EROEI analysis
   would not normally incorporate this factor, unless the energy costs of correcting the
   environmental impact was incorporated under energy invested but this would not be a
   very useful analytical approach.

6. Complexity and resilience – as discussed above, there is a direct link between the
   EROEI of society’s energy systems and the complexity of the society that can be
   sustained by it. Homer-Dixon (2006)¹⁸ refers to Tainter’s work and links it with the
   work of Crawford S. Holling on ecological systems. All systems, including those that
   make up a human society, go through “adaptive cycles” of growth, collapse and
   regeneration (Homer-Dixon, 2006, p.226). As a system grows, it not only becomes
   more complex, it also develops greater connectedness, as each part becomes
   dependent on the part before it. As the human actors in the system seek the ever
   greater EROEI needed to support their by now very complex society, they use their
   ingenuity to improve the efficiency of each part of the system. Doing so makes the
   relationship between the parts more tightly coupled. That efficiency gain is at the
   expense of system resilience. As the system loses resilience, it develops “brittleness”
   and it becomes less able to cope with interruptions in inputs to the system. One
   example of this is our modern global economic system, with the development of justin-
   time logistics, facilitated by IT and the internet.

   In making choices about what energy systems to build, if a complex and brittle one is
   chosen over a less complex and more resilient one, if and when they fail, they will be
   less likely to cause a much more widespread failure in the other systems that society
   relies on. Also, a more complex and brittle energy system requires that high levels of
   complexity in the wider society are maintained. This could be seen as a risk in an era
   when the extraction rates of society’s main sources of energy, fossil fuels, are finite
   and are expected to go into decline during the next two or three decades and where
   the timing of some of the declines, particularly coal (Energy Watch Group, 2007,
   p4)¹⁹, is not known with great certainty.

7. Managing supply & demand (storage issues) – energy provision could be
   compared with performing a theatre play: one that never ends! The show has to go
   on: day after day, night after night, following demand. This issue needs to be
   examined carefully when appraising options for electricity generation systems from
   renewable sources, such as wind, tides or solar.

Conclusions and limitations of this essay

EROEI is, or should be, the most important physical criterion used to assess the practicability
of a proposed energy system for two reasons:

First, if the EROEI of an energy system is 1:1 or lower, it is no longer an energy
source. As the EROEI drops below 1:1, it becomes an energy sink. This is important
now, because society currently benefits from such high EROEI from fossil fuels that
the low EROEI of alternatives may not be as obvious as it would otherwise be. The
growth in use of corn-based ethanol as a substitute for fossil fuel in the US vehicle
fleet is an example where it is uncertain that the biofuel-based energy system delivers
any net energy (Cleveland et al, 2006)²⁰.

Second, the energy choices made now, if they are not made with a grasp of the wider
implications of a reduction in our energy systems’ overall EROEI, will cause a
profound, painful and largely unexpected and apparently inexplicable reduction in the
complexity of society: in other words, an unmanaged and protracted collapse.

Despite the centrality of EROEI, the other physical criteria referred to above must also be
taken into account in an appraisal of energy system options; although energy density,
location of resource and (to a certain extent) infrastructural requirements could all be
incorporated into an EROEI analysis.

In examining EROEI, this essay has assumed that the analyses would be of different energy
supply alternatives. An EROEI analysis could equally usefully be applied to different
conservation and demand reduction alternatives. In this case, the other physical criteria may
be different. Appraising the effect of psychological factors and behaviour change may require
a different analytical approach.

This essay has not discussed the non-physical factors that also influence an energy system
option appraisal: financing constraints, psychological and behavioural factors, political and
security issues, macro economic implications. These remain important but, if an appraisal is
to be meaningful, the physical criteria, particularly EROEI, must be fulfilled, or the extent to
which they act as constraints must be understood, before the non-physical factors are
considered. Most important to avoid is to see non-physical factors as key whilst ignoring or
seeing as peripheral the physical criteria. Richard Heinberg²¹ has said we must make our
energy choices “carefully, intelligently and co-operatively”. In providing an overview of the
physical criteria which determine how useful an energy system can be, this essay has
illustrated why EROEI is the most important but not the sole criterion in deciding how to meet
society’s energy needs.

References

1 Cleveland, C.J. (2001), “Net energy from the extraction of oil and gas in the United States”, Energy 30, Elsevier,
.pdf available

2 From www.eroei.com/articles/the-chain/what-is-eroei/

3 Cleveland, C.J., Costanza, R., Hall, C.A.S., & Kaufmann, R., (1984), “Energy and the US economy: A biophysical perspective”,
Science 225

4 Odum, H.T., (1996), “Environmental Accounting, Emergy and Decision Making”, John Wiley.

5 From www.world-nuclear.org/info/inf75.html

6 In a radio interview with Jason Bradford on KZYX on 5 June 2006 – audio archive
Global Public Media – 8mins35secs into file.

7 Presentation by Peter Davies, BP Special Economic Advisor to the All Party Parliamentary Group on Peak Oil and Gas,
Wednesday,16 January 2008 Meeting information
(.pdf available)

8 Secretary of State for Trade & Industry, (May 2007), “Meeting the Energy Challenge”, Government White Paper on Energy,
Department for Business Enterprise and Regulatory Reform (BERR), formerly the Department for Trade and Industry (DTI), The
Stationery Office/HMSO, CM7124/ID5539714, .pdf available

9 Stern, D. I. (2003), “Energy & Economic Growth”, Rensselaer Polytechnic Institute, Troy N.Y., USA,
.pdf available

10 Vail, J., “EROEI Short #2: Lenin & Lohan”, 28 August 2007, The Oil Drum, www.theoildrum.com/node/2893

11 Heinberg, R. speaking at the Annual Conference of the Soil Association in Cardiff, 26 January 2007
Soil Association

12 Tainter, J. A., (1988), “The Collapse of Complex Societies”, paperback edition 1990, Cambridge: Cambridge University Press

13 Diamond, J., (2005), “Collapse, How Societies Choose to Fail or Survive”, London: Penguin

14 Illich, I., (1974), “Energy and Equity”, Calder and Boyars, London

15 International Energy Agency (2006), World Energy Outlook 2006, OECD/IEA, Paris, p.492 (p.493 of the PDF file
.pdf available)

16 Cleveland J. Cutler, 2005, Net Energy from the Extraction of oil and gas in the United States, Energy 30 (2005) 769-782,
www.sciencedirect.com / www.elsevier.com/locate/energy

17 Hirsch, R. L. et al, (February 2005), “Peaking of World Oil Production: impacts, mitigation, & risk management”, US
Department of Energy, .pdf available

18 Homer-Dixon, T. F., (2006), “The Upside of Down, Catastrophe, Creativity, and the Renewal of Civilisation”, Washington,
Island Press, www.theupsideofdown.com

19 Zittel, Werner & Schindler, Jörg, (March 2007, updated version dated 10 July 2007), “Coal: Resources and Future
Production”, Energy Watch Group, EWG-Paper No. 1/07
.pdf available

20 Cleveland, C. J. et al, “Energy returns on ethanol production”, Science 23 June 2006: pp1746-1748,
www.sciencemag.org/cgi/content/full/312/5781/1746

21 Heinberg, R, “Peak Oil: Local Solutions to a Global Challenge”, talk delivered 22 November 2006, Totnes Civic Hall Transition
Town Totnes

This is a guest article by Dudley Stark, Reader in Mathematics and Probability in the School of Mathematical Sciences, Queen Mary, University of London.

Bentley introduced the following model of oil production on page 204 of

Global oil & gas depletion:an overview,
and it is dicussed
in the book The Last Oil Shock by David Strahan.
This posting is meant to explain his model and some results I obtained for it.
Consider the following oil production
curve:

It rises quickly to it’s peak at time t=1 and decreases slowly until
no oil is produced at time t=6. The idea is that the natural pressure
of the oil field causes rapid production initially, after which
decline is more gradual.
Before and after the peak the curve is
linear, so it looks like a triangle.

[break]

Suppose the next oil field looks the same as the first one, but
oil production begins
one unit of time later and the total amount of oil produced
is only 75% of the oil in the first field. It looks like this:

Adding the production of the two oil fields together gives this production curve:

If you do this eight times, each time shifting the start of production by
one time unit from the previous oil field and also
making the amount of oil produced
75% of the previous oil field, you get a curve like this:

It is starting to look like a plausible oil production curve. Note, however,
that it is not too realistic because, for one thing,
the curve is linear in between integers.

In my paper
Peak Production in an Oil Depletion
Model with Triangle Field Profiles,
accepted to appear in Journal of Interdisciplinary Mathematics,
I analyze Bentley’s model.
The production curve of the ith oil field is assumed to look like
this:

Note that the amount of time from the start of production
until peak is delta for each curve
and the amount of time from peak to the end of production is lambda.
We assume that delta is smaller than lambda.
The ith field begins production at time (i-1)delta.
The amount of production
at peak is determined by a parameter m_i which also
determines the total amount of oil produced by the ith field.

I show that in this model, assuming that the m_i are decreasing,
the resulting total oil production curve
is concave

on the interval [0,lambda] and is decreasing on the interval
[lambda,infinity).
The oil production curve therefore takes it's maximum
on the interval [0,lambda].
If the m_i decrease geometrically, then in addition the
oil production curve is
convex
on the interval
[lambda,infinity).

I also show that if delta=alpha/n for a constant alpha and a parameter n
and if the
m_i=f(i/n) for a decreasing function f,
then as n goes to infinity the oil production curve converges to a smooth
(meaning differentiable)
curve which is again concave on [0,lambda] and decreasing
on [lambda,infinity).
Here is an example of a smooth curve:

These curves are concave on the interval [0,lambda] and attain their
unique peaks there.
If f is a negative exponential function (which is the continuous
analogue of a decreasing geoometric), then the oil production curves
are convex on [lambda,infinity).
I show that for these limiting curves
it is not possible to have 1/2 of the total oil produced at the
time of peak production and in fact they have at most about 35% of the total
oil produced at the time of peak production.

A related paper is

“Oil Production: A probabilistic model of the Hubbert curve”
by Bertrand Michel, who spoke at the
ASPO-V conference,
to appear in Mathematical Geosciences.
In his model the field sizes are chosen uniformly at
random from a truncated Pareto distribution. Conditional on the size of the
field, the starting time for oil production is Gamma distributed
with parameters depending on the size. The field
profile shapes are constant; in his application they are given
by splines.
So Michel’s model is similar to Bentley’s but harder to
analyze and
probably more realistic.
He uses it to model North Sea oil production
(see Figure 11 on page 18).
The fit is pretty good except
for a decrease in
production caused by the “Piper disaster”, which couldn’t be anticipated
by the model.

I perform a similar analysis for Bentley’s model of gas production,
in which the ith field production profile has a trapezoidal shape:

The trapezoidal shape is suppposed to be more realistic for gas profiles
because gas production is constrained by the pipes which transport it.

Conclusion

Bentley’s model generates plausible looking
asymmetric production curves in which
less than 50% of the total oil has been produced at the time of peak production.
The fact that they are asymmetric is not surprising:
see the paper

“Testing Hubbert “
in which it is found that the asymmetric exponential curve is most often
the best fit when six different types of
curves are fitted to real data.

I’d also like to point out that,
though
I think papers like this one are important because oil production is important,
no one else seems to be doing this kind research in the
mathematics of oil production
and therefore many math journals wouldn’t
consider publishing a paper like this. The reason is that they only
want to publish papers that
reference other published papers in respected journals and this paper
only references oil industry papers and peak oil books, as well as
another paper written by myself. I was pleased to learn about Michel’s paper,
which is published in Mathematical Geology, but references a lot of oil
industry papers and is like an applied
statistics paper.

You can get in touch with me at D.S.Stark@maths.qmul.ac.uk

Previous post from Dudley:
The limit of the statistic R/P in models of oil discovery and production

The world faces many environmental trends of disruption and decline. The scale and complexity of issues facing our fast-forward world have no precedent. With “Plan A”, business as usual, we have neglected these issues overly long. In “Plan B 3.0″, Lester R. Brown warns that the only effective response now is a Second World War-type mobilisation like that in the United States after the attack on Pearl Harbor.

What is a wartime mobilisation, what triggers one and what relevance does such thinking have to today’s challenges?

[break]

In Brown’s first Plan B book he described the wartime mobilisation thus:

In his State of the Union address on January 6, 1942, one month after Pearl Harbor, President Roosevelt announced ambitious arms production goals. The United States, he said, was planning to produce 60,000 planes, 45,000 tanks, 20,000 anti-aircraft guns, and 6 million tons of merchant shipping. He added, “Let no man say it cannot be done.”

Achieving these goals was possible only by converting existing industries and using materials that previously went into manufacturing civilian goods. Nowhere was this shift more dramatic than in the automobile industry, which was at that time the largest concentration of industrial power in the world, producing 3-4 million cars a year. Auto companies initially wanted to continue manufacturing cars and simply to add on production of armaments. They agreed only reluctantly—after pressure from President Roosevelt—to a wholesale conversion to war-support manufacturing.

Aircraft needs were enormous. They included not only fighters, bombers, and reconnaissance planes, but also the troop and cargo transports needed to fight a war on two fronts, each across an ocean. From the beginning of 1942 through 1944, the United States turned out 229,600 aircraft, a fleet so vast it is hard to visualize.

While the aircraft industry did nearly all the assembly, the auto industry supplied some 455,000 aircraft engines and 256,000 propellers. The aircraft industry was given the job of assembling all planes to ease its fears that the auto industry would become firmly entrenched in the manufacture of aircraft and would dominate the industry after the war.

The year 1942 witnessed the greatest expansion of industrial output in the nation’s history—all for military use. Early in the year, the production and sale of cars and trucks for private use was banned, residential and highway construction was halted, and driving for pleasure was banned.

In her book No Ordinary Time, Doris Kearns Goodwin describes how various firms converted. A sparkplug factory was among the first to switch to the production of machine guns. Soon a manufacturer of stoves was producing lifeboats. A merry-go-round factory was making gun mounts; a toy company was turning out compasses; a corset manufacturer was producing grenade belts; and a pinball machine plant began to make armor-piercing shells.

In retrospect, the speed of the conversion from a peacetime to a wartime economy was stunning. The automobile industry went from producing nearly 4 million cars in 1941 to producing 24,000 tanks and 17,000 armored cars in 1942—but only 223,000 cars, and most of them were produced early in the year, before the conversion began. Essentially the auto industry was closed down from early 1942 through the end of 1944. In 1940, the United States produced some 4,000 aircraft. In 1942, it produced 48,000. By the end of the war, more than 5,000 ships were added to the 1,000 that made up the American Merchant Fleet in 1939.

Douglas A-26 Production Line During World War II.
The Boeing Company / Douglas Aircraft Historical Gallery

The description is undoubtedly a powerful indication of what can physically be done. How the resources of a nation can be rapidly switched from one application to another. From this, it is reasonable to propose that it is physically possible to mobilise today’s resources and focus them towards the looming energy crisis.

The US production and sale of cars and trucks for private use was banned in 1942, releasing tremendous productive capability for the manufacture of armaments. Today the production of internal combustion engine vehicles, of aeroplanes, of flat screen TVs, of Playstations and Xboxs, of tungsten filament light bulbs etc. could be banned in a similar move and in their place renewable energy generation, efficiency improvements and electrified transport infrastructure deployed. Globally, we have never had greater manufacturing capacity. The problem is that it isn’t allocated to the problem at hand.

Wartime mobilisation is a way to forcibly reallocate resources, away from the allocative efficiency achieved by Smith’s invisible hand of the market reflecting the optimal mix as determined by the consumers. When an economy is allocative efficient no individual can be made better off (according to their desires) without another being made at least as worse off.

Wartime mobilisation is called upon to shift resources towards a more immediate goal – preservation of the very nation state (or in the US WWII case, of European nation states with which America was aligned). Under this threat allocative efficiency is trumped, the market driven by consumer choice is replaced temporarily with a command economy until the threat is diminished. It could be argued that the market can respond to energy depletion in a way it can’t to an invading army. However, due to the time scales involved waiting for the market signal leaves the response too late.

So what of peak oil? We recognise that peak oil is a serious problem. It appears that mitigation is not possible from the allocation of resources arising from today’s consumer choice leading many, including Lester Brown, to suggest a wartime mobilisation. Wartime mobilisation is rare however, it only happens at times of war. The cold war’s space race could be considered a wartime mobilisation of sorts.

Is peak oil a war? Can it command the same resources that built a quarter of million aircraft, developed the atomic and hydrogen bombs and put a man on the moon?

I don’t think peak oil does look like a war, at least not to the people for whom it needs it to look like one to trigger mobilisation. Only the heads of states and their immediate circle, with support of their military, can mobilise a country for war and they are only likely to do so when immediately threatened by loss of their nation states. Herein lies the problem, maybe peak oil doesn’t represent the absolute loss of the nation state, just the degradation of it.

Wars are primarily targeted at the leaders of a country with collateral damage usually regarded as an unfortunate consequence. This is the exact opposite of peak oil, which through increased energy and resource costs, disproportionally affects the poorer people in society.

Imagine ranking all the countries in the world by some criteria of affluence, countries in Western Europe, North America etc. would be near the top and the countries of sub-Saharan Africa near the bottom. I suggest that the impact of peak oil on these affluent countries will be to slide them down this scale, closer to the less affluent countries. This continuum might not be a gentle side as the complex and fragile systems employed by affluent countries may not degrade gracefully. However, the critical point is that affluence is eroded from the bottom, not the top. The leaders of some of the poorest countries of the world still live in luxurious houses, ride in Mercedes cars and have their own private planes. Their ‘elite’ position is maintained so there is little incentive for ‘wartime’ mobilisation to address the problems in their countries. This has been painfully apparent in Zimbabwe recently, whilst the economy crumbles Zanu-PF, the military and the police seem to retain a degree of affluence.

The same could happen to affluent countries facing energy depletion – whilst the ruling elite’s position is maintained the majority population’s quality of life can deteriorate significantly without Lester Brown’s mobilisation being triggered. Remember we are already seeing the impact of peak oil today, expressed as $140+ per barrel and increased fuel poverty yet there is no sign of wartime mobilisation.

That’s my case for peak oil not triggering wartime mobilisation. But what could do it?

The majority population could become annoyed with their deteriorating situation to such an extent that the incumbent ruling class are ousted. The threat of such revolution could lead to mobilisation. However wartime mobilisation needs cooperation from the population and with revolution in the air this cooperation may not be available.

If some aspect of peak oil didn’t have the characteristic of ‘degradation from the bottom up’ but instead hit the potential instigators of wartime mobilisation as acuity as the lower classes we might have found a sufficient trigger.

Electricity’s binary nature, it’s either available for all or not available for anyone, could be such a trigger. If energy depletion renders a nation’s electricity provision unreliable everyone is affected and popular support would be forthcoming. Peak oil and electricity shortages are different. Scarcity, pricing out an increasing proportion of the population, creating demand destruction, is different to all-inclusive power cuts.

In the UK at least, electricity supply will be under serious pressure during the coming decade as legacy nuclear infrastructure is decommissioned, North Sea gas supplies deplete and environmental legislation threatens to close some coal-fired infrastructure.

South Africa is today experiencing such electricity problems, are they moving to a wartime footing to address it? Maybe even blackouts aren’t as threatening as an enemy at the gates.

A final thought, the command economy that wartime mobilisation represents is likely an inefficient way to doing things. An energy intensive approach historically only employed by energy rich nations. In the 1940s the US was awash with cheap energy. Since the nature of our problem is energy shortage, addressing it with an inefficient process has to be questionable!

Conclusion

Wartime mobilisation of available resources can go a long way towards mitigating the problem of peak oil. However, peak oil is unlikely to present itself in a way that triggers a national mobilisation on a wartime scale. The leaders will be somewhat isolated from the threat and the necessary popular support will be lacking. Peak oil erodes affluence from the bottom, not threatens the top like a war does. Nations just become poorer, affluent countries sliding down towards the less affluent countries of today.

Whilst this may be the case for peak oil, considering the wider energy depletion picture electricity provision stands out. It doesn’t have the ‘bottom up’ characteristic and as such could trigger an energy led wartime mobilisation of resources.

Electricity could be more problematic than liquid fuel supply in the UK, potentially a good thing if electricity shortage is more able to trigger the massive reallocation of resources our situation requires than peak oil itself.

This post presents the development of the energy mix for UK, how UK in less than a decade went from being a substantial energy exporter to a substantial net energy importer. A more detailed look on what to expect for UK natural gas prices in the near term and a brief discussion on the real options available for future UK energy consumption.

The UK development in energy consumption and energy mix for the years 1965 – 2007 in MTOE. Click to enlarge.

(MTOE; Million Ton Oil Equivalents; 1 MTOE approximates 20 000 bbl/d (oil))

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The diagram illustrates how coal in the late 60’s and early 70’s gradually was substituted with oil and increasingly natural gas in the UK energy mix. The introduction of nuclear and natural gas into the energy mix in the early 80’s is based on a combination of factors based on lessons learned during the oil embargo in 1973. The use of oil became more efficient and natural gas, due to adequate indigenous supplies, and nuclear substituted oil for some electricity generation and heating.

In 2007 UK consumed close to 2% of the global total primary energy consumption.

There are few countries where natural gas constitutes such a huge part of the energy consumption. In the recent years natural gas has made up 36 – 38% of UK primary energy consumption (in the US natural gas constitutes 25% of the total primary energy consumption). Among the countries with considerable energy consumption, only in Russia has natural gas a higher relative part (above 50%) of the total energy consumption. (Russia is now listed to have more than 25% of global remaining recoverable natural gas reserves.)

If time (and the TOD editors) permit I will in a future post look into the real possibilities of filling the emerging UK natural gas supply gap with natural gas from Netherlands, Norway, Russia and LNG which for the medium term (meaning the next ten years) seems to be the most viable future supply sources. This will be depressing reading (if you live in UK), so don’t say you were NOT warned!

The recent decline in UK oil consumption is thought to be related to the recent oil price increases. Natural gas consumption is sensitive to weather (temperature), which means heating requirements, and of course a competitive price.

I am in the process of drafting a post for TOD Europe comparing the development in energy/oil consumption and production for the G-7 countries (Canada, France, Germany, Italy, Japan, UK and US) and the BRIC (Brazil, Russia, India and China) members. One of the interesting observations from this study, so far, is that it looks like the G-7 countries oil consumption is very sensitive to relative high upward price movements of oil, like in the 70’s and 80’s and now most recently.

The UK development in energy consumption and energy mix for the years 1965 – 2007 in MTOE. Click to enlarge.

(MTOE; Million Ton Oil Equivalents; 1 MTOE approximates 20 000 bbl/d (oil))

The above diagram shows the relative development of primary energy sources within the energy mix for the years 1965 – 2007 for UK. Back in 1965 coal was the main energy source for UK delivering around 60% of the primary energy consumption. Over the years coal has gradually been substituted with mainly natural gas and nuclear and presently coal makes up less than 20% of total UK primary energy consumption.

UK FROM NET ENERGY EXPORTER TO NET IMPORTER

The development in net energy exports and imports split on energy sources for UK for the years 1981 – 2007 in MTOE. Click to enlarge.

(MTOE; Million Ton Oil Equivalents; 1 MTOE approximates 20 000 bbl/d (oil))

Through a period of 25 years the UK was a net oil exporter, which peaked with the production in 1999. 6 years later, in 2005, UK again became a net oil importer and the UK oil production from the North Sea is now generally thought to be in irreversible decline (with expected decline rates of 8 – 10% annually), suggesting future growth in oil imports if consumption stays at present levels. Even if indigenous supplies of oil are in decline, this may be overcome with a combination of increased imports and improved efficiencies in the use of oil.

The real near term challenge to UK energy supplies is identified to be natural gas supplies.

Natural gas has since the early 70’s become the most dominant UK primary energy source based upon indigenous supplies. The UK was a net exporter of natural gas (to Continental Europe) from 1995 – 2003. UK natural gas production peaked in 2000 and the UK again became a net natural gas importer as of 2004 and in 2007 UK net imports was more than 20% of its natural gas consumption.

In 1984 UK became a net importer of coal. UK coal reserves is listed to have a R/P ratio of 9 according to BP Statistical Review 2008, meaning that present reserves will last in 9 years at present rate of production.

NATURAL GAS AND OIL PRICES

It is generally observed (and acknowledged) that natural gas prices tend to follow the path of the oil prices with a time lag. Some analysts have even predicted that natural gas prices could decouple from oil prices sometime in the future.

Studying the price ratio of nat gas versus oil on a heating value basis (per million Btu) tells an interesting story.

The development in the price ratio between natural gas and oil. Click to enlarge.

The above diagram shows the development in the price ratio between natural gas and oil against the left y-axis for;

• LNG (delivered in Japan)
• Natural gas (cif) delivered to EU
• Natural gas at Henry Hub (USA)
• Natural gas at Heren NBP (National balancing Point) UK

In the diagram is also the development in the oil price shown in US$ 2007 against the right y-axis.
Note how when oil prices were low natural gas based on energy content became relatively more expensive than oil and vice versa.

When the energy price ratio is below 1.0 this indicates that natural gas based on energy is cheaper than oil and vice versa when this ratio becomes greater than 1.0.

Japan seems recently to increasingly profit from the run up in oil prices as LNG purchased on long term contracts becomes relatively cheaper as a source of energy based on heat content. Developers of LNG facilities generally preferred long term contracts due to the capital intensive nature of the LNG business as this also increases the predictability for return on the investment and a steady profit flow. This is also one of the reasons why it has been challenging to establish a well functioning spot market for LNG.

Historically, and for those of the readers who are interested, 1 (one) barrel of oil has been converted to approximately 6 (six) million Btu of natural gas based on price. This means that if oil is priced at US$132/bbl, 1 million Btu of natural gas should be expected to cost US$22 at the trading point or beach.

(1 000 000 Btu = 10 Therm; 1 Therm = 100 000 Btu)

The diagram illustrates that the recent years run up in oil prices, as from 2004, have made natural gas increasingly and relatively cheaper than oil (in the diagram it can be observed how the hurricanes Katrina and Rita affected US natural gas prices in absolute terms and relative to oil in 2005). Note also how natural gas became relatively expensive as oil prices fell.

So far in 2008 the recent runs up in the oil prices have further encouraged an increase in the demand for natural gas. The result from this demand growth may now be observed in the recent price increases for natural gas at trading points like Henry Hub (USA) and NBP (UK)

Consumers who have dual fuel capabilities (like electrical power plants normally used for peak shaving) will tend to alternate between natural gas and distillates based on price.

The UK was a net exporter of natural gas form the years 1995 to 2003 (ref the diagram above illustrating the development for UK as a net energy exporter and net energy importer) and how this increased with the opening of the Interconnector between Bacton and Zebrugge in Belgium in 1998.

For UK owners of natural gas the liquid market of Continental Europe was in close reach and prices on the beach on Continental Europe was on average 20% higher than in the UK (ref the above diagram) and serving this market did not pose any big technical challenges, financial or political risks.

The lower nat gas prices at the beach for UK domestic users, both household and industrial, also gave UK industry a competitive edge (relative to consumers in Continental Europe and even in the US) and made comfortable amounts of energy available and affordable for households.

WHERE IS UK NATURAL GAS PRICES HEADED AND WHY

In 2007 the UK natural gas market became flooded with natural gas thus depressing prices. This flood of natural gas resulted from several sellers, like Norway, Holland (BBL) and LNG traders, had perceived an increased tightness in the UK market (due to declines in UK indigenous supplies and expected growth in consumption) for the heating season 2006/2007 and positioned them to reap the profits from this tightness. What happened, as these players seems to have been unaware of each other (which should be the case in an ideal liberalized marketplace), was that supply increased more than demand grew and in addition the weather became milder than normal, a combination and a recipe for depressing natural gas prices.

UK will increasingly have to cover their natural gas consumption through imports, which suggests that an era of cheap natural gas, which has also acted as a competitive edge, increasingly will have to become harmonized with natural gas prices on Continental Europe which UK increasingly will have to bid against to secure supplies. Indirectly this may now be observed as less natural gas is exported to Continental Europe in the summer months through the Interconnector.

• With reference to the diagram showing the development in the energy price ratio between natural gas and oil and establishing a reference to 2007 levels, further assuming harmonization against natural gas prices on Continental Europe, this should suggest that nat gas prices in the UK at the beach has to come up 50 – 60% relative to 2007 levels. On average in 2007 these prices were 30 p/therm at the beach (the natural gas price has huge seasonal swings).
• Oil prices in 2007 was on average above US$72/bbl, and so far in 2008 the average oil price has been close to US$110/bbl and recently it seems like it has found support at US$130 – 140/bbl. This now suggests that the natural gas prices should put on an additional 80 – 90%.

The above points suggest that natural gas prices on average in 2008 in UK will have to put on 150 – 200% resulting in average prices through 2008 of 75 – 90 p/therm at the beach. Recently natural gas is now trading at 60 – 65 p/therm.

It is difficult to predict the weather for the upcoming heating season and this is often the one factor having the greatest effect on short term natural gas prices. Given the seasonal nature of natural gas consumption it should come as no surprise if UK natural gas prices at the beach move north of 100 p/therm before the upcoming Christmas.

For an average household consuming 600 – 700 therm/annually (18 – 21 000 kWh/a) this would translate into an increase of the households natural gas bill of £3 – 400 this year relative to 2007.

SUMMARY

In this post it has been shown why UK households and industries should expect to increasingly be hammered by growing energy prices.

In less than ten years UK went from being a considerable energy exporter to becoming in size a similar energy importer. In 2007 UK imported more than 20% of its energy needs. This import is now forecast to grow at an annual rate of 13 – 15 MTOE (250 – 300 kboe/d; kilo barrels of oil equivalents a day) or 6 – 8% in the years ahead. What makes UK such an interesting subject from an energy standpoint is that the UK has had to transit from a major energy exporter to an energy importer with a speed never seen before for any other comparable economy. There are economies that are and have been more reliant on energy imports than UK (like Germany, France, Italy, Japan to name a few) and these have from these realities developed (seemingly) long term successful strategies involving central government’s involvement to cope with this energy reality.

This post has further shown that the UK energy mix is dominated by natural gas and thus made it vulnerable for potential future supply crunches. To revise the energy mix is a time consuming process and if the world has passed, is on or close to its apex for liquid energy supplies, these will not constitute a sustainable alternative to natural gas for the UK energy mix.

I have been informed that after a coal mine has been closed it may take ten years to recommission it for operations. Coal is mainly used for electricity generation and could of course be used for both heating and cooking purposes, which suggests changing housing appliances and stoves to accommodate this. To base the future UK energy mix on more coal results in future growth in coal imports.

Nuclear energy comes with delicate political maneuvering as the public needs to familiar itself with this alternative. Further needs nuclear plants a lead/construction time of approximately 10 years from approval have been granted.

I have not presented anything about renewables.

(I consequently refuse to use the expression “renewable energy”, as people who are familiar with the laws of thermodynamics know that energy by nature is NOT renewable. Energy may be transformed from one form into another.)

So called renewables will play a role in the future energy mix, but their impact on energy supplies must realistically be viewed against the potent and versatile nature of oil and natural gas.

Like USA talks about its oil addiction it looks like UK needs to talk about its natural gas addiction.

Given the time frame and not least options available to redesign the UK energy mix it looks like the UK “energy supply war” may have been lost before most people became aware that there was one on.

Nature enforces its own limits and a realistic look on the future energy options available for UK, energy conservation and power down now seems the most likely. This is of course a harsh message for any politician to convey to the public as it requires talent and leadership which there generally seems to be a universal deficit of……even in good times.

Below the fold we have a video of Dr Richard Pike, CEO The Royal Society of Chemistry, discussing his belief that there is twice as much oil in the ground as major oil producers would have us believe. Thanks to online debating channel www.friction.tv for providing the video.

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Click to play

Pike spends his time explaining how the 1.2 trillion barrels of proved reserve does not tell the whole story, putting to one side for a moment questionable OPEC revisions, of course this is true.

After explaining how there is likely lots more oil, Pike then states “oil will peak pretty soon” due to limited infrastructure. This isn’t a very helpful debate though. At the extreme, with infinite infrastructure we could extract all the oil in one afternoon. A little more realistically, if we managed through some Herculean global effort akin to a wartime mobilisation, to double the oil infrastructure over the next decade we’d surely sail through 2020 at 100mbpd. This isn’t the point though.

Yes there may be an “oil shortage myth” but debunking that myth doesn’t debunk the limited flow rate fact.

Yes there is lots of oil but that is only one aspect of this multivariate problem. Reality is a function of geology, infrastructure, capital, labour, geopolitics etc.

The connection he makes between proven & probable reserves and carbon dioxide is important though. The peak oil problem is more to do with flow rates than the ultimately recoverable reserve (URR). The CO2 problem is more to do with URR than flow rates.

With Consumer Prices Index (CPI) rising to 3.3% (year on year to May-08), the fastest rate of increase in over a decade, the Governor of the Bank of England has written to the Chancellor to explain.

Open letter from Mervyn King governor of the Bank of England to Alistair Darling, Chancellor of the Exchequer. Click for full letter.
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Here’s Darling’s reply:

Open letter from Alistair Darling in response to King’s. Click for full letter.

What can we learn from this exchange?

Starting with King. He reviews the situation noting that inflation has recently risen sharply from 2.1% in December to 3.3% in May. The increase driven almost entirely by the increased price of food, fuel, gas and electricity. In the year to May:

• world agriculture prices increased by 60% and UK retail food prices by 8%.
• world oil prices rose by more than 80% to average $123 a barrel and UK retail fle prices increased by 20%.
• wholesale gas prices increased by 160% and UK household electricity and gas bills by around 10%.

This global situation is compounded by:

The depreciation of sterling, which has fallen some 12% since its peak last July, has boosted the prices of imports and will add to the pressure on consumer prices.

The situation is only expected to deteriorate with recent increases in oil and wholesale gas futures prices.

As things stand, inflation is likely to rise sharply in the second half of the year, to above 4%.

So far so good but now the letter becomes less clear. King suggests this period of “above-target inflation” is temporary (the target is 2%). This is explained by the inflation being driven by commodity prices rising relative to the prices of other goods and services yet the amount of money being spent in the economy not increasing quickly. To me this sounds like only a step away from stagflation, hardly a positive development.

From Wikipedia:

…stagflation can result when an economy is slowed by an unfavourable supply shock, such as an increase in the price of oil in an oil importing country, which tends to raise prices at the same time that it slows the economy by making production less profitable.

Then against all expectations King suggests:

It is possible that commodity prices will rise further in the coming months – oil prices have now been rising for four years. But in the absence of further unexpected increases in oil and commodity prices, inflation should peak around the end of the year and begin to fall back towards the 2% target.

Further unexpected increases? Unexpected by whom? For sure, if oil and commodity prices stop rising inflation will fall but I’d hardly call further rises unexpected.

The Bank of England sets the interest rate monthly. This is seen as the main tool for controlling inflation. With inflation running significantly above target one might expect action to be taken on interest rates. However King has this to say:

…if the Bank Rate were set to bring inflation back to the target within the next 12 months, the result would be unnecessary volatility in output and employment. So the MPC is aiming to return inflation to the 2% target within its normal forecast horizon of around two years, when the present sharp rises in energy and food prices will have dropped out of the CPI inflation rate.

An admission that taking the actions required to lower inflation would damage the economy too much so all he can offer is to wait for the sharp rises to drop out of the rolling year and hope there aren’t further sharp rises. Waiting and hoping doesn’t fill me with confidence. And with no reason to believe current price trends will moderate, at least not before they have wrought havoc with the economy, we’re left with an unchecked rise in the rate of inflation.

In chancellor Darling’s response he added little but to agree with King’s assessment and make some favourable comparisons with the Euro zone and United States.

Both men leave the impression that current events are unexpected, temporary in nature and won’t have a long term or serious affect on the economy. On these three points they are wrong in my opinion. The trend (if not the absolute magnitude) in commodity price rises has been expected. There is nothing to suggest, as King does, that the rising trend will flatten any time soon and when compounded with the UK’s declining energy production the situation can only be exacerbated.

Euan reviewed the UK energy situation in this post: UK Energy Security. It is clear that declining oil and gas production and corresponding increased imports at increasing prices will have tremendous impact on the national trade balance.

The right action to take given the situation as presented, is to find a way for the UK to operate on significantly less energy that it does today. Unfortunately this is not the course of action proposed in today’s correspondence.

Euan’s closing remarks last year are even more relevant today:

The alternative may be to face real energy shortages in 2 to 8 years time when the anticipated supplies of imported natural gas and oil do not appear. Energy shortages combined with spiralling energy costs and energy import bills may paralyse our economy.

This is a guest post from Andy Hunt (solar_bud on The Oil Drum). It’s an inspiring account of what can be done today with a modest property to live efficiently and maintain a degree of energy security.

Vital Statistics

Our house was built around 1900. It is an end-terrace house with 2 bedrooms, located in an inner-city area in Bury, Lancashire, UK. Our household comprises me and my partner, with no children, and we live in the property all year round. No planning restrictions are in effect in our area.

Wood burning stove with back boiler.

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Annual Energy Use

We use around 3200 units of electricity annually from the grid, although this is expected to fall once we install the second stage of our solar PV system. This includes all cooking, as we don’t have a gas supply, and is about average for our part of the country.

Our heating system is 100% wood and solar fuelled, so we don’t tend to count heating in our energy consumption. We go through quite a few logs over the course of a winter though!

We use a ‘green’ electricity tariff, initally Npower “Juice” but now Good Energy as it’s 100% renewable unlike Juice.

About Us and Why We Did It

I work as Sustainability Manager for a local Council, and have a long-standing interest in energy issues, climate change and fossil fuel depletion. I have always wanted to live in an eco-house, and my home renovation project of our very ordinary Victorian terraced house has made that dream a reality.

My partner comes from a family whose motto is “mend and make do”, and she has grown up with solid fuel heating all her life. She is very practically minded, the daughter of an electrician, so her ideas and practical suggestions have been a very valuable part of our ‘green’ experiment.

Heating

The existing gas central heating system was converted to run on wood fuel and solar power.

I hired a plumber who disconnected the existing radiator system from the (cheap and low-quality) gas combination boiler which was running it when I bought the house, and connected it up to a new wood burning stove which was installed in the fireplace in the living room. The stove has a back boiler which runs two pipe loops – one connects the stove to a dual-coil hot water storage cylinder in the bedroom directly above, and the other connects the stove to the radiators in the house.

The hot water storage cylinder is heated by convection from the back boiler, and on the return pipe from the cylinder to the stove is a pipe thermostat. When the temperature of the return pipe (and hence the water in the cylinder) reaches 60°C, the thermostat starts a circulation pump in the radiator circuit, which pumps hot water around the house. This ensures that the hot water cylinder is heated as a priority, and is kept hot at all times.

When choosing a wood stove, it is essential to choose the right type for the application and situation. An ordinary room heater stove will provide warmth and cooking facilities in an emergency such as a power cut. A larger stove with a back boiler like ours can also run a central heating and hot water system, but is more expensive to install.

If you live in a smoke control area, you must legally install a stove which is exempt from the Clean Air Act by DEFRA for burning wood in a smoke control area. Most stove manufacturers make such models, but at the time of writing the only wood stove with a back boiler which is CAA-exempt is the Dunsleyheat Yorkshire stove.

In the summer, the cylinder is heated by a solar hot water system, which is plumbed into the lower coil in the hot water storage cylinder – the wood stove is plumbed into the top coil. Our solar hot water system is by Zen Eaga Solar – it is a flat plate system, and works well. Most solar hot water system installers will provide a dual-coil cylinder as part of the installation. The cost of the cylinder is actually a substantial part of the cost of the whole system.

Power Generation

The house uses solar photovoltaic panels and a battery back-up system for power security and low carbon emissions.

In the house there are two ring-mains – one which serves the heavy duty appliances in the kitchen such as the hob, cooker and washing machine, and a second one which serves the rest of the house.

When considering solar PV for electricity generation, I didn’t like the idea that I would still lose power during a power cut if the system was grid-connected. So I went for a hybrid system, which doesn’t feed excess power into the grid but stores it in batteries, will work during a power cut for several days, and can also take mains electricity when it is available.

We currently have 330Wp of solar PV (to be expanded to around 700-900Wp soon), connected to a 720Ah battery bank and an inverter-battery charger, which serves my second (low power) ring main. The inverter/charger is a Powermaster 1.5kW pure sine wave inverter which can take a 240V mains input, or can run off the batteries and solar PV in the absence of mains electricity. It was originally designed for use aboard boats, and so we just use the grid as our ‘shore power’ equivalent. Interesting to think of our home as a ship afloat at sea when we are running off-grid! Our PV panels are currently two Schüco 165Wp polycrystalline panels – the next stage will see an additional 165Wp Schuco panel plus a 200W Kyocera polycrystalline panel, bringing our installed capacity to 695Wp. The 30A solar controller on the inverter/charger can take up to 1kWp of solar, so even then there will still be room for another 200-300Wp of PV, as long as we can find the roof space for it!

In the summer the system will run for around a week at a time before the batteries need to be recharged from the mains. Further PV addition should improve this so that it runs pretty much constantly over the summer months. In the winter when the PV isn’t generating as much, the batteries can be charged from the mains and in UPS mode the inverter will switch over to the batteries during a power cut, which will last us for 3 days or so, giving us desk lamps, TV (using a laptop and TV card), central heating pump, solar pump and general electrical gadgetry which makes life much more bearable during a power cut.

The only things we can’t use during a power cut are the heavy-duty kitchen appliances. The fridge can be plugged into the off-grid ring main during a power cut with an extension reel.

Batteries and inverter.

Water and Sewage

We have only made fairly basic water efficiency improvements at Green Cottage – the installation of two water butt in the garden holding around 450 litres, a dual-flush toilet and spray nozzles on the bathroom taps all help to reduce water consumption.

We do have a dishwasher and a washing machine but they are both ‘A’ rated for energy and water efficiency. Studies have shown that dishwashers make more efficient use of water and electricity than washing up by hand, and we have a manual ‘wonder washer’ for clothes which we can use during power cuts. Our dishwasher is a very new model, and the instructions give details on how to connect it up to make use of solar-heated hot water. However, we tend to use our solar hot water for baths and showers only, so the dishwasher is actually connected to the cold water supply in our case. Not ideal, but with British summers the way they are, we need all the solar power we can get just for washing ourselves!

Insulation

We have had the standard 250mm of loft insulation installed under a Scottish Power discount insulation scheme a few years ago – most utilities offer these schemes under the Government’s Energy Efficiency Commitment. You can find out which are the cheapest schemes in your area by telephoning your local Energy Efficiency Advice Centre on 0800 512 012.

Unfortunately our house does not have a wall cavity and so we can’t install cavity wall insulation. We have no intention of getting external insulation done – far too expensive! The nice thick Accrington brick walls of our home give a good thermal mass though.

Summer Cooling

The high thermal mass of our old house helps to keep it cool in the summer.
We are lucky in that our living room is on the North-facing side of the house, but houses the wood stove which heats the house in the winter.

This arrangement means that in the winter, the living room is the warmest room in the house, and in the summer it is deliciously cool, even in the hottest weather. The high thermal mass of the house means that the North side stays very cool, like a larder, even whilst the back of the house is baking in the midday sun.

Lighting

All the lights in the house are Compact Fluorescent Lamps, otherwise known as energy-saving bulbs.

We tend only to use low-power desk lamps rather than the ‘big light’ in each room. As the desk lamps run from the solar PV/battery system, this means that we get free electricity to run the house’s lighting, and also that we have lighting even during a power cut.

Appliances

All appliances are energy efficient appliances, under the European rating system.

The kitchen appliances are ‘A’ rated, with the exception of the fridge, which although old is still working. Rather than scrap it and buy a new one, we invested in a ‘Savaplug’, which regulates the motors on old fridges and reduces their energy consumption.

We watch television on a laptop computer with a LCD monitor, and a TV card, which uses very little electricity. The same computer doubles up as our stereo CD player and DVD player, which means we have very little entertainment technology clutter.

Even with 100% electric cooking, our electricity bill is very low, typically around £5-6 weekly.

One measure we have recently taken to cut our electricity consumption is a flat-bottomed kettle to go on our wood stove – electric kettles use huge amounts of electricity, and our £3 aluminium stove-top kettle from Ikea will hopefully make a significant difference to our electricity bill!

The Garden

Although just a small terraced house back garden, ours is crammed with food plants, biodiversity and storage areas.

Our back garden is South-facing, and has been planted up according to Permaculture design principles.

A huge variety of perennial fruits and berry plants are crammed into a small area, with an additional raised bed for growing annual vegetables.

Perennials include: strawberries, blackcurrants, redcurrants, whitecurrants, blueberries, a grape vine, apple tree, pear tree, raspberries, cranberries, blackberries and hazelnuts.

We have tried a variety of different things in the raised beds – the most successful to date have been carrots, pak choi, tomatoes (although we have had problems ripening them as they grow against an East-facing wall), French beans, onions, potatoes and a pumpkin which we have just harvested. We also had a butternut squash plant in the miniature greenhouse which did very well, although the pot it was in turned out to be too small for it in the end.

A storage space for logs, a bunker for kindling, a small lean-to greenhouse and a table and benches for enjoying the sun are all crammed into this typical small terraced house back yard. Space has even been found for a network of four small wildlife ponds and wildlife areas amongst the food growing, and the garden has a significant population of frogs, which is good because slugs and snails are a big problem. We use copper ‘slug rings’ to try to keep small plants safe, but it’s a constant battle, and I may well try other approaches in the future such as beer traps.

Conclusion

It has taken a good few years to get from standard gas-heated end-terrace to low-carbon eco-cottage, a lot of hard work, improvisation and a reasonable chunk of hard-earned cash, but we love the end result. The old gas combi used to really struggle to heat the house, but the wood stove system warms the brickwork through, and we are really cosy. It’s also great not having to use any kind of heating in the summer, as the solar hot water system provides us with a cylinder full of free hot water, and even the solar pump runs on free electricity.

I’d like to thank Powerswitch for the inspiration, help and encouragement provided on their forums.

There’s nothing quite like relaxing in a hot bath knowing it has been heated free of charge by the sun, and free veggies from our back garden taste so much better than from the supermarket. A couple more PV panels and we will be finished. And then, we might start looking for a small patch of woodland for our next project…

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First published in Permaculture Magazine – solutions for sustainable living.
www.permaculture.co.uk

On BBC One Scotland at 22:45 this evening (Wed 4th June) Hayley Millar explores the history and future of North Sea oil and reasons for the recent run up in the oil price in the documentary Truth, Lies, Oil and Scotland.

Watch a clip here.

On BBC Two, Newsnight Scotland (23:00) will host a live debate on Peak Oil featuring an interview with Chris Skrebowski and discussion with Bill Jamieson (Executive Editor of The Scotsman) and Euan Mearns (Editor of The Oil Drum Europe).

These transmissions are on the Scottish regional versions of BBC One and Two, but anyone with a satellite receiver in the UK should be able to find the Scottish versions on Sky channels 971 and 990.

UK oil production peaked at 2.9 million barrels per day in 1999 and now stands at 1.6 million barrels per day. This is below UK oil consumption levels making the UK an oil importer.