MuseLetter #177 / January 2007
by Richard Heinberg

The problems of Climate Change and Peak Oil both result from societal dependence on fossil fuels. But just how the impacts of these two problems relate to one another, and how policies to address them should differ or overlap, are questions that have so far not been adequately discussed.

Despite the fact that they are closely related, the two issues are in many respects dissimilar. Climate Change has to do with carbon emissions and their effects—including the impacts on human societies from rising sea levels, widespread and prolonged droughts, habitat loss, extreme weather events, and so on. Peak Oil, on the other hand, has to do with coming shortfalls in the supply of fuels on which society has become overwhelmingly dependent—leading certainly to higher prices for oil and its many products, and perhaps to massive economic disruption and more oil wars. Thus the first has more directly to do with the environment, the second with human society and its dependencies and vulnerabilities. At the most superficial level, we could say that Climate Change is an end-of-tailpipe problem, while Peak Oil is an into-fuel-tank problem.

Because of this crucial divergence, the training and priorities of people who study one problem often differ from those of people who study the other. Most advocates for the Peak Oil concept—sometimes known as “depletionists”—are energy experts, economists, journalists, urban planners, or workers retired from the oil industry (usually geologists or petroleum engineers). Among climate analysts and activists there are more environmentalists, fewer energy experts, and far fewer retired oil industry employees. It is my experience that, when placed in the same room together, the two groups often talk past one another.

My own background is primarily as an environmentalist: I teach a college course on human ecology and have been writing about ecological issues for 15 years or so; at the same time, I find myself identified primarily as a Peak Oil activist, having written three books about the subject and having given something like 300 lectures on it. To me, head-butting arguments between the two groups as to which problem is more serious constitute a peculiar kind of hell, in that such arguments can only hamper the efforts of both groups in doing what we all agree is essential—averting environmental and human catastrophe. Nevertheless, disagreements and misunderstandings are already emerging for the simple reason that advocates on both issues are competing to persuade the public of the central importance of their cause.

Since such competitive disagreements are ultimately damaging to our broader collective interests, it seems important to devote some effort toward openly discussing the differences and similarities of the issues themselves, as well as the priorities and views of their respective interest groups. This essay is intended to be exploratory and descriptive rather than polemic; my assumption is that it is better for the issues to be clarified and discussed than for them to remain unarticulated. My thesis is that both groups are essentially working toward a reduction in society’s consumption of fossil fuels, and that cooperative efforts between the two groups could substantially strengthen their arguments and their effectiveness at persuading policymakers.

Differing Perspectives

While the Peak Oil and Climate Change issues may themselves be relatively clear and discrete, the groups of scientists and activists who study and organize around them are far from being distinct and internally homogeneous. Some individuals and groups working on issues related to oil and natural gas depletion are well informed about climate science, while some are not. Some climate protection groups are sensitive to fuel-supply vulnerability issues; others are not. Some Peak Oil activists are what have come to be known in the blog world as “doomers”—that is, they believe that there is no hope at this point for the preservation of modern civilization in any recognizable form; others are “techno-fixers,” who think that the world will adjust—painfully perhaps, but in the end successfully—to oil depletion through conservation and the development of alternative energy sources. Similarly there are “moderate” climate-change scientists and activists who see the problem as serious but solvable, while there are some who believe that the world has already passed a “tipping point” beyond which catastrophic impacts are inevitable. It is probably fair to say that the substantial majority of both groups find themselves somewhere midway between extreme positions staked out by some of their spokespeople.

So, given this lack of homogeneity among the groups, it would be inappropriate to generalize too much and I will try as best I can to remain sensitive to these differences and overlaps during the following discussion. After giving some thought to the matter, I have chosen not to mention names of individuals who hold the views that I will be describing.

Let us begin with the group I know better—the depletionists. It is fair to note that some Peak Oil analysts seem to be of the opinion that oil depletion constitutes a solution to the dilemma of global greenhouse gas emissions, or that Climate Change is actually not a problem at all. This appears to be the view primarily of some former oil industry geologists, but is probably not that of the majority of depletion analysts. The view is rarely stated openly (I was unable to find a glaring instance in print, though I have heard it expressed in conversation). Nevertheless, it is a notion that understandably causes concern and consternation among Climate Change activists.

For their part, many Climate Change activists and experts see global warming as potentially having such devastating consequences, not just for humans but for the whole biosphere, that Peak Oil seems a trivial concern by comparison. They argue that, even if global oil production peaks soon, this will provide no solution whatever to Climate Change because society will replace oil with coal and other low-grade fossil fuels—which will simply worsen greenhouse gas emissions. Moreover, since the remedies for carbon emissions that climate activists propose will inevitably lead to increased energy efficiency and a reduction in oil consumption, they often feel such efforts constitute an adequate answer to the Peak Oil problem.

Most oil depletionists (excepting the small group discussed above) appear to hold the opinion that Climate Change is indeed a legitimate concern; however, since the economic impact of Peak Oil looms in the immediate future, the economic and geopolitical chaos that may be triggered by declining global fuel supplies pose the more timely threat. Some have argued that if Peak Oil results in near-term economic collapse and wars over dwindling energy resources, these events will seriously or terminally undermine the ability of national leaders to undertake the cooperative, long-range planning necessary to reduce carbon emissions.

For many Climate Change activists, theirs is primarily a moral issue having to do with the fate of future generations and other species. Their message implies an appeal to self-preservation, but since they cannot prove that the most horrific climate consequences being predicted (the drowning of coastal cities by rising seas, rapidly expanding deserts, collapsing agricultural production) will occur within the next decade or two, the motive of self-preservation is often downplayed. This emphasis on the moral dimension of climate activism is clear in Al Gore’s documentary film, An Inconvenient Truth.

It is probably safe to say that most Peak Oil activists are motivated more by their immediate concerns for preservation of self, family, and community. They see the peak of global oil production as happening soon and the effects accumulating quickly. This concern for self-preservation is prominent in the quasi-survivalist tone of several Peak Oil websites.

Perhaps because Climate Change activists see that a dramatic reduction in emissions must be undertaken voluntarily and proactively, and that the depletion of fossil fuels will not occur quickly enough to deter catastrophic emissions levels, they tend to accept generous estimates of remaining fossil fuels as a way of dramatizing the need for action. They see the argument that depletion will take care of the carbon emissions problem as a threat, because it could lead to apathy. They argue that there are enough fossil fuels left on the planet to trigger a climatic doomsday; and, to underscore the argument, Climate Change often quote robust estimates of remaining oil reserves and amounts awaiting discovery issued by agencies such as the United States Energy Information Administration (EIA), and by companies like ExxonMobil and Cambridge Energy Research Associates (CERA)—most of whose forecasts seem unrealistically optimistic compared to the majority of expert forecasts. Climate protectors understandably feel fully justified in doing this, because these, after all, are official estimates and forecasts.

Peak Oil activists adhere to more pessimistic resource estimates and production forecasts, and it is tempting to think that this is partly because doing so makes their case appear stronger. However, the track record of prediction by the optimists is not good:

• During the 1960s, the U.S. Geological Survey issued successive reports forecasting a peak in U.S. oil production around the year 2000; this followed M. King Hubbert’s controversial forecast of a peak around the year 1970. Confounding the official view, U.S. oil production did reach its maximum in 1970 and has been generally declining ever since, despite the subsequent discovery of the largest conventional oilfield ever found in North America—on the North Slope of Alaska—in the 1970s.
• In their International Energy Outlook (IEO) 2001 report, the EIA stated that “The United Kingdom is expected to produce about 3.1 mb/d by the middle of this decade, followed by a decline to 2.7 mb/d by 2020,” implying a peak around 2005. Britain’s oil production from the North Sea actually peaked in 1999, two years before this forecast was issued, at 2.684 mb/d, declining to less than 1.7 mb/d by 2005.
• In their IEO 2003 report, the EIA predicted that the country of Oman was “expected to increase output gradually over the first half of this decade” with “only a gradual production decline after 2005.” In fact, Oman’s production had already peaked in 2000, three years before the forecast was published.

This pattern of unrealistic optimism on the part of the official forecasting agencies continues with regard to other countries, and thus probably, by extrapolation, to the world as a whole. So it might be unrealistic for the climate protectors to give credence to such forecasts, official though they may be, or even to assume that the truth lies somewhere equidistant between the extreme resource estimates of the so-called optimists and pessimists.

Parenthetically, both groups have reasons (though different ones) to regard ExxonMobil as an arch-foe. That company has consistently funded groups undermining public concern about Climate Change. And recently ExxonMobil has placed prominent magazine ads proclaiming that the global oil production peak is so far in the future that it is something we need not worry about. One ExxonMobil executive has been widely quoted as saying, “Peak oil theory is garbage.”

Differing Recommendations

These differences in perspective lead to somewhat diverging policy recommendations.

For Climate Change analysts and activists, emissions are the essence of the problem, and so anything that will reduce emissions is viewed as a solution. If societies shift from using a high-carbon fossil fuel (coal) to a fossil fuel with lower carbon content (natural gas), this an obvious benefit in terms of climate risk—and it is potentially an easy sell to politicians and the general public, because it merely requires a change of fuel, not a sacrifice of convenience or comfort on the part of the general public. And so, again, climate analysts tend to accept at face value official high reserves estimates and production forecasts—in this case, for natural gas.

However, as with oil, production forecasts by the official agencies for natural gas supply have tended to be overly robust. For example, in the U.S. the EIA issued no warning whatever of future domestic natural gas problems prior to the supply shortfalls that became painfully apparent after 2000, as prices more than quadrupled. Nevertheless a few industry insiders had noted disturbing signs: companies were drilling at an accelerating pace in order to maintain production rates, and newer fields (which tended to be smaller) were depleting ever more quickly. By 2003 the U.S. Energy Secretary was proclaiming a natural gas crisis. In the following three years, warm weather (perhaps due to Climate Change) and demand destruction (from the off-shoring of many industrial users of natural gas due to high domestic prices) led to a partial relaxing of prices and general complacency. However, U.S. domestic production appears set to decline further, and likely at a rapid pace.

For depletion analysts and activists, societal dependence on vanishing, non-renewable energy resources is the essence of the greatest dilemma that our society currently faces. We have created a complex, global economic infrastructure built to run on fuels that will start to become scarce and expensive very soon. From this perspective, natural gas is not a solution but an enormous problem: even if the global peak in gas production is 10 to 20 years away, regional shortages are already appearing and will continue to intensify. This means enormous risks for home heating, for the chemicals and plastics industries, and for electrical power generation. Natural gas is and will always be a fuel that is, for the most part, regionally traded (as opposed to liquid fuels, which are more easily shipped). Thus for many nations critical to the world economy—the U.S., Britain, and most of continental Europe—gas cannot serve as a “transition fuel.”

Coal presents another controversial topic for both depletion and emissions analysts. Most members of both groups feel a keen need to articulate some politically palatable transition strategy so as to gain the ears of policy makers. If coal were entirely ruled out of the discussion, such a strategy would become more difficult to cobble together. However, the two groups tend to think of very different future roles for coal.

Some emissions activists and analysts look to “clean coal” as a partial solution to the problem of Climate Change. “Clean coal” practices include gasifying coal underground, in situ, and then separating the resulting greenhouse gases (carbon dioxide and carbon monoxide) and then burying these in ocean sediments or old oilfields or coalmines This theoretically allows society to gain an energy benefit while reducing additions to atmospheric greenhouse gases.

Many depletion analysts are skeptical of such “carbon capture” schemes, believing that, when the world is mired in a supply-driven energy crisis, few nations will be adequately motivated to pay the extra cost (in both financial and energy terms) to separate, handle, and store the carbon from coal; instead they will simply burn whatever is available in order to keep their economies from crashing.

Some depletionists see the world’s enormous coal reserves as a partial supply-side answer to Peak Oil. Using a time-proven process, it is possible to gasify coal and then use the resulting gases to synthesize a high-quality diesel fuel. The South African company Sasol, which has updated the process, is currently under contract to provide several new coal-to-liquids (CTL) plants to China and has announced a plant in Montana.

CTL is not attractive to emissions analysts, however. While some carbon could be captured during the gasification stage (at a modest energy cost), burning the final liquid fuel would release as much carbon into the atmosphere as would burning conventional petroleum diesel.

A few depletion analysts tend to take a skeptical view of future coal supplies. According to most widely-quoted estimates, the world has at least two hundred years’ worth of coal—at current rates of usage. However, factoring in dramatic increases in usage (to substitute for declining oil and gas supplies), while also taking account of the Hubbert peak phenomenon and the fact that coal resources are of varying quality and accessibility, leads to the surprising conclusion that a global peak in coal production could come in as few as 30 years (this conclusion can be extrapolated from a recent study for the DOE regarding the US coal supply).1 That raises the question: does it make sense to place great hope in largely untested and expensive carbon sequestration technologies if the new infrastructure needed will be obsolete in just a couple of decades? Imagine the world investing trillions of dollars and working mightily for the next twenty years to build hundreds of “clean” coal (and/or CTL) plants, with the world’s electrical grids and transportation systems now becoming overwhelmingly dependent on these technologies, only to see global coal supplies rapidly dwindle. Would the world then have the capital to engage in another strenuous and costly energy transition? And what would be the next energy source?

Other low-grade fossil fuels, such as tar sands, oil shale, and heavy oil are also problematic from both the depletion and emissions perspectives. Some depletion analysts recommend full-speed development of these resources. However, the energetic extraction costs for these are usually quite high compared to the energy payoff from the resource extracted (also known as the energy returned on energy invested, or EROEI). Their already-low energy profit ratio would be compromised still further by efforts to capture and sequester carbon, since, as with coal, these low-grade fuels have a high carbon content as compared to natural gas or conventional oil. Currently, natural gas is used in the processing of tar sands and heavy oil; from an emissions point of view, this is rather like turning gold into lead. Many depletionists point out that, while the total resource base for these substances is enormous, the rate of extraction for each is likely to remain limited by physical factors (such as the availability of natural gas and fresh water needed for processing), so that synthetic liquid fuels from such substances may not help much in dealing with the problem of oil depletion in any case.

Supply Side, Demand Side

By now a disturbing trend becomes clear: the two problems of Climate Change and Peak Oil together are worse than either by itself. Strategies that might help to keep lights burning and trucks moving while reducing emissions are questionable from a depletionist point of view, while most strategies to keep the economy energized as oil and gas disappear imply increasing greenhouse gas emissions. As we will see, the closer we look, the worse it gets.

As noted above, both groups need to design a survivable energy transition strategy in order to “sell” their message to policy makers. Carbon emissions come from burning depleting fossil fuels, the primary energy sources for modern societies. Thus both problems boil down to energy problems—and energy is essential to the maintenance of agriculture, transportation, communication, and just about everything else that makes up the modern global economy.

With regard to both problems there are only two kinds of solutions: substitution solutions (finding replacement energy sources) and conservation solutions (using energy more efficiently or just doing without). The former is politically preferable, as it does not require behavioral change or sacrifice, though it tends to require more planning and investment. The least palatable option, from a political standpoint, is also the quickest and cheapest—doing without (curtailing current usage). We have gotten used to using enormous amounts of energy, at rates unprecedented in history. If we had to use much less, could we maintain the levels of comfort and economic growth that we have become accustomed to? Could we even keep the lights on?

Several questions become critical: How much of a change in energy supply will be imposed by the peaking of production of oil and natural gas? How much will be required in order to minimize Climate Change? And how much of that supply shortfall can be made up for with substitution and how much with efficiency, before we have to resort to curtailment?

Climate analysts agree the world needs to reduce emissions considerably. In 1996 the European Environment Council said that the global average surface temperature increase should be held to a maximum of 2 degrees C above pre-industrial levels, and that to accomplish this the atmospheric concentration of carbon dioxide (CO2) will have to be stabilized at 550 parts per million (the current concentration is 380 ppm, though the addition of other greenhouse gases raises the figure to the equivalent of 440 to 450 ppm of CO2). But recent studies have tended to suggest that, in order to achieve the 2 degree cap, much lower CO2 levels will be needed. One study by researchers at the Potsdam Institute for Climate Impact in Germany concluded that—again, to keep the temperature from increasing more than 2 degrees C—the atmospheric concentration target should be 440 ppm of CO2 equivalents, implying that the atmospheric concentration of greenhouse gases will need to be stabilized at current levels. But, to make the challenge even more difficult, it turns out that the biosphere’s ability to absorb carbon is being reduced by human activity, and this must be factored into the equation; by 2030, this carbon-absorbing ability will have been reduced from the current 4 billion tons per year to 2.7 billion. Thus if an equilibrium level of atmospheric carbon is to be maintained through 2030, emissions will have to be reduced from the current annual level of 7 billion tons to 2.7 billion tons, a reduction of 60 percent. It is hard to imagine how, if that translated to a 60 percent reduction in energy consumption, it could mean anything but economic ruin for the world.

Depletion analysts look to about a 2 percent per year decline in oil extraction following the peak of global oil production, with the rate increasing somewhat as time goes on. Regional natural gas decline rates will be much steeper. The dates for global production peaks for both fuels are of course still a matter for speculation; however, it is reasonable to estimate that we might see more than a 25 percent or more decline in energy available to the world’s growing population over the next quarter-century as a result of depletion.

Everyone would be happy if it were possible simply to substitute renewable sources of energy for oil, coal, and gas, and both depletion activists and climate activists support the expansion of most renewable energy technologies, including solar and wind. But there are realistic limits to the scale at which renewables can be deployed, and to the speed with which this can be accomplished.

Not all depletion or emissions activists support the large-scale development of biofuels (ethanol, butanol, and biodiesel), which are the only realistic replacements for liquid transport fuels, because of the low energy return on investment entailed in making these fuels, and because these substitutes imply worrisome tradeoffs with food production.

Some depletionists and some climate analysts recommend expanding nuclear power, arguing that technological advances could make it a safe and affordable alternative. Others argue against it, noting that high-grade ores will be depleted in 60 years, and that the entire nuclear cycle of mining, refining, enrichment, plant construction, and so on (excluding fission itself) is carbon intensive. One analysis suggests that, from the mid-2020s, the task of clearing up all past and future nuclear wastes will require more energy than the industry can generate from the remaining ore.

Then comes the equity issue. A few nations have benefited disproportionately from fossil fuels. If “developing” nations that have not yet had that opportunity are now required to forgo it, they will understandably perceive this as grossly unfair. They are unlikely to agree to dramatically reduce their own carbon emissions (i.e., fossil fuel consumption) voluntarily unless already-industrialized nations lead the way and reduce theirs proportionally more. Also, it’s necessary that at least a few of the “developing” nations—the ones that are rapidly industrializing now—be brought on board any global emissions or depletion agreement in order for it to have real meaning, as they have the economies with the fastest growth in energy demand. The prime example: while for practical purposes Americans will probably continue to lead the world in per capita fossil fuel use for some time, China will likely overtake the U.S. in 2009 as the world’s foremost national emitter of greenhouse gases.

Where does this leave us? Let’s assume that the more pessimistic critical analyses of both groups are correct. That is, let’s say that a 60 percent reduction in emissions is needed within 25 years, that natural gas will not be available in sufficient quantities to serve as a transition fuel, that “clean” coal will not help much, that low-grade fossil fuels will not make up for shortfalls in oil production, that CTL production will (or should) remain marginal, that renewables will not come on line in sufficient quantity or soon enough, that nuclear power won’t come to the rescue—and that modest contributions from each or most of these sources added together will not come close to making up for shortfalls from oil and gas depletion or from the voluntary phasing out of carbon fuels.

If this turns out to be the case, we may face a staggering need for energy efficiency and curtailment. Neither group wants this as its political platform.

The theoretically fairest solution, from an emissions point of view, would be to assign each living human an equal per capita right to emit carbon, and to create a market for those rights, so that continued disproportionate fossil fuel consumption by already-industrialized nations would entail substantial payments to less-industrialized nations. Fairness would also imply a steeper rate of reduction in fossil fuel consumption by the heavy users—a cut in emissions of considerably more than 60 percent.

However, to ask industrialized nations to share their wealth with less-industrialized nations while the former are engaged in a partially self-imposed energy famine seems highly problematic. What politician could demand the extra sacrifice? What public would vote for such a policy?

Common Ground

As we have seen, there are understandable reasons for some climate activists to ignore the arguments and priorities of depletionists, and vice versa. Dealing with only one of the two problems is much easier than confronting both. But our goal must be to deal with reality (rather than merely our preferred image of reality), and reality is complicated. Our world faces the interacting impacts not only of Peak Oil and Climate Change, but also of water scarcity, overpopulation, over-fishing, chemical pollution, and war (among others). In the end, there are too many of us using too much too fast, while competing for dwindling resources.

What would it take to solve all of these problems at once? A good start would be to require a global across-the-board 5 percent per year reduction in fossil fuel consumption and the provision of substantial financial and technical aid by industrialized nations to less-industrialized nations in creating a renewable energy infrastructure. But to the patient (the primary fossil fuel users) this medicine might seem worse than the disease. A grand plan like this has almost no chance of gaining political backing.

Realistically, we are left with the customary policy tools aimed to ameliorate the world’s ills piecemeal: emissions and depletion protocols, tradable quotas, emissions rights, import and export quotas, carbon taxes, and cap-and-trade mechanisms.

Thus for practical reasons it is probably inevitable that emissions and depletion activists will continue to pursue their separate policy goals. But it makes sense for the two groups to be informed by one another, and to cooperate wherever possible.

It is fairly obvious why such cooperation would benefit the depletionists: Climate Change is already a subject of considerable international concern and action, whereas Peak Oil is still a relatively new topic of discussion.

But how would such cooperation aid emissions activists?

In a word: motivation. As discussed earlier, emissions activists appeal to an ethical impulse to avert future harm to the environment and human society, while the Peak Oil issue appeals to a more immediate concern for self-preservation. In extreme circumstances, the latter is unquestionably the stronger motive. Strong motivation will certainly be required in order for the people of the world to undertake the enormous personal and social sacrifices required in order to quickly and dramatically reduce their fossil fuel dependency. Sustainability and equity are issues that are hard enough to campaign on in times of prosperity; when families and nations are struggling to maintain themselves due to fuel shortages and soaring prices, only a mobilization of public support through massive education and persuasion campaigns could possibly summon the needed support.

Taken together, Climate Change and Peak Oil make a nearly air-tight argument. We should reduce our dependency on fossil fuels for the sake of future generations and the rest of the biosphere; but even if we choose not to do so because of the costs involved, the most important of those fossil fuels will soon become more scarce and expensive anyway, so complacency is simply not an option.

What would cooperation between the two groups look like? It would help, first of all, for activists on one issue to spend more time studying the literature of the other, and for both groups to arrange meetings and conferences where the intersections of the two issues can be further explored.

Both groups could work together more explicitly to promote proactive, policy-driven reductions in fossil fuel consumption.

Climate activists could start using depletion arguments and data in tandem with their ongoing discussions of ice cores and melting glaciers, but to do so they would need to stop taking unrealistically robust resource estimates at face value.

For their part, depletionists—if they are to take advantage of increased collaboration with emissions activists—must better familiarize themselves with climate science, so that their Peak Oil mitigation proposals are ones that lead to a reduction rather than an increase of carbon emissions into the atmosphere.

Perhaps, for both groups, with a stronger potential for motivating the public will come the courage to tell a truth that few policy makers want to hear: energy efficiency and curtailment will almost certainly have to be the world’s dominant responses to both issues.

1. Vaux, Gregson, “The Peak in US Coal Production” (FTW, 2004), <www.fromthewilderness.com/free/ww3/052504_coal_peak.html