What do you think?

(Note from Alison - This question was asked directly to Ed Miliband at the Big Energy Shift event in Church House in London. The policy lead on this issue has passed me this reply)

The Government’s response is consistent with the latest analysis of oil production prospects by the International Energy Agency (IEA). In setting out the Government’s position, it’s worth reviewing the IEA’s latest projections as published in the World Energy Outlook 2008. Total oil production is expected to grow until 2030, the end of the forecast period, increasing by more than 26% between 2007 and 2030. Demand is also projected to grow, but the IEA’s considered view is that oil supplies from both conventional and unconventional sources will be adequate to meet rising demand for the entire length of its forecast,, provided that sufficient investment in production takes place.

Although oil production is unlikely to peak before 2020, we recognise that reserves are finite and are putting in place policies that will reduce the UK’s reliance on oil across the range of its uses. Given oil’s importance to road transport, we support the research, development and deployment of alternative transport technologies, require the blending of biofuels into petrol and diesel, and promote greater fuel efficiency through improved vehicle emissions standards. On heating, the Heat and Energy Saving Strategy consultation, published on 12 February, sets out the Government’s long-term vision for dramatically improving the energy efficiency of our homes and businesses and expanding the provision of low carbon heat. The measures set out in the consultation could reduce oil consumption in 2020 by 6%. Finally, as part of the Government’s wider commitment to ensuring secure and low-carbon energy, we will increase the share of renewables in the UK’s energy mix, including transport, to at least 15% by 2020. The Renewable Energy Strategy, which sets out how we intend to achieve this ambitions goal, will be published in spring.

These policies should ensure that the UK is well placed to mitigate the risks associated with future declines in oil production.

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Vote: 10   5   Alison, policy advisor at the Department of Energy and Climate Change / 23.04.09 / 10:27 pm

hi all that’s very interesting.
we have just had a visit from a organisation called warm front( a government funded initiative) this organisation will fix your heating if you are in recite of certain benefits so after taking part in the b.e.s. i thought great we might be able to get some renewables.
not from these people, only oil/gas/electric (yes i know you can get green elec) ,not even wood pellet or even wood burners.
They don’t even have a solid fuel installer at the moment.
We are now waiting for a engineer to visit and advice us what is feasible.

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Vote: 9   3   peter wray / 05.05.09 / 8:26 am

That’s the standard government response. But the IEA has got progressively more worried in the past 6-12 months, and a recent article in the Guardian pointed out that the IEA’s chief economist, Fatih Birol, says that global oil supply will peak by 2020, *not* 2030 ( http://www.guardian.co.uk/business/2008/dec/15/global-oil-supply-peak-2020-prediction ). Of course, now we’re in recession prices have fallen somewhat, but the moment growth picks up again oil prices will rocket. Here’s a quote from the artile in the Guardian:

“Birol’s comments will give more ammunition to those who warn that the British government is dangerously complacent in not trying to wean the country off oil as quickly as possible. Some observers believe that, because the global economy is underpinned by oil, the peaking of supply will cause severe economic, social and political disruption unless prepared for over many years.

John Hemming, chairman of the All Party Parliamentary Group on Peak Oil and Gas, said Birol’s “conversion” was significant. “The penny has finally dropped - geological issues matter as well as political and economic. The IEA - unlike our government - appears to be leaving cloud cuckoo land finally,” he added.”

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Vote: 8   1   Mike Pepler / 26.05.09 / 3:55 pm

For more info and how perhaps to cope with the crisis see http://www.TransitionNC.org - the intro pages, the blogs and how individual Transition Groups are tackling the problem - in the absence of any meaningful contribution from the government.

Oh, and sorry for the typos in my previous post - forgot to check it!

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Vote: 4   2   Paul Sousek / 20.07.09 / 1:45 pm

The first contribution by Alison is typical of this government’s dangerously complacent approach to peaking oil production.

By some calculation we are already past the peak.

World oil production has been rising at about 3-4% annually since the War, except for the politically inspired crises of the 1970s and 80s, in line with demand - that is up to May 2005.

Since then world oil production has been stagnating at around 85mbd, despite increasing prices. Even the extreme spike in oil price in the course 2008 has not increased oil production. That is because oil production in 2008 was running at the maximum level possible. despite unprecedented increases in price production has not increased, because it could not.

Demand was still increasing, but due to the impossibility of production increase, demand destruction took place through the price mechanism.

Since then demand and consumption has decreased by some 2% and the oil price collapsed from $147 to $30 per barrel. That extreme price drop is another piece of evidence indicating just how tight oil supplies were.

The 2008 oil spike is set to repeat every one or two years. Every time the world economy starts recovering and demand picks up to mop up the 2% spare production capacity, oil and energy prices will yet again spike to new record levels

That will of course cause a slow down and recession. In this way we will fluctuate between hope and despair until politicians (and their advisors, Alison) realise that this is not just a one off recession or even a one off depression, but the start of a long term, 40 year plus economic decline caused and governed by gradual oil depletion, or Peak Oil.

The geological oil depletion will not really begin until about 2011 (if I understand the Petroleum Review analysis correctly, but in the current phase of extreme oil price fluctuations investment will be held back, depressing actual oil production.

The end result is that this planet will never again produce as much oil as it has in 2008. And the sooner we take tat on board and switch to renewable, the better.

Further more, Governments own analysis indicates that by 2020 UK will be importing 80% of our energy needs (it is 20% now) - which is alarming, but actually impossible. By 2020 price of energy is likely to be five to ten times higher than now, which will make it utterly impossible to finance that level of imports. So we’d better get a move on!

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Vote: 3   2   Paul TransitionNC.org / 20.07.09 / 1:49 pm

The Guardian article cited above by Mike Pepler is somewhat misleading in its coverage of the IEA’s projections.

The projections cited by Fatih Birol in his interview with the Guardian are from the World Energy Outlook 2008 and the same ones used to explain the Government’s position above. However, the interview focuses on the production of ‘conventional’ crude oil, neglecting increases in both non-conventional oil and, more importantly, Natural Gas Liquids (NGLs).

The IEA’s total oil projections, including non-conventional oil and NGLs, are cited in the first post and show oil production increasing out to 2030. The World Energy Outlook 2008 also states explicitly that the “world’s total endowment of oil is large enough to support the projected rise in production beyond 2030” (World Energy Outlook 2008, p. 41).

Of course, as ‘Paul TransitionNC.org’ notes, the crucial issue is investment. Investment to expand production is often a lengthy process, with geologically complex projects sometimes requiring a decade of investment before production comes on stream. This process is made even more difficult by oil price fluctuations, which, as mentioned above, dissuade necessary long-term investment in oil production. The Government recognises the ongoing challenge of ensuring that current investment is sufficient to meet future needs, and in response to this challenge hosted the London Energy Meeting of world energy ministers in December, where ministers stressed the need for greater investment to support future oil production globally.

Regarding Paul TransitionNC.org’s final paragraph, net imports of oil, gas and coal are projected to account for 38% of total UK primary energy demand in 2020.

In summary, oil supplies are more than adequate, although the Government recognises challenges to maintaining sufficient investment in production. This position is in line with the IEA’s World Energy Outlook 2008, as referenced in the Guardian article, which projects total oil production to grow to 2030, the end of its forecast period.

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Vote: 3   1   Alison, Policy Advisor at the Department of Energy and Climate Change / 27.07.09 / 11:28 am