Priorities

I love that top graph. “Unidentified Projects” is so optimistic. Don't worry, we just haven't identified the projects yet that will supply the world with a significant percentage of its energy within 2 years, and more than half of its motive fuel in another 15 years. Just go back to designing your new 6-lane bridge.

Dan,
You should follow this up with something about what we should do about this enormous problem that our political leaders continue to ignore.

To your last point, the blame doesn't just rest with Burgess or City Council (though this useless law does). The same downtown business community that supports this law also supports the tunnel and has opposed parking taxes. Their vision of downtown is a completely car-dependent economy for the foreseeable future. Yet another 'sustainability gap' that needs closing – our current business “leaders” have no idea, I don't think, how to guide our economy into the future. Their thinking is already 20 years out of date, and receding fast…

With the new techniques that have been developed in the last few years, we now have natural gas reserves equal to the energy equivalent of Saudi Arabia.

Check out the Marcellus Shale.

By converting cars to electrical power and producing it with non carbon based means we can dramatically cut our carbon fuel consumption.

You should put huge quotes around “reserves.”

Where are we going to get all the electricity to power our electric cars (and all the steel to make the cars? And all the energy to make the steel to build the cars? And all the oil to maintain the roads for the cars? And so on…)?

Oh, the military is just a bunch of pot-smoking hippies. What do they know?

Curious what your two points – that we have plentiful natural gas, and that we should produce power through “non carbon based means” – have to do with each other?

And of course, as Stacy points out, more emissions come from manufacturing the cars than from their tailpipes. So we could cut our emissions far more dramatically by re-making our cities than re-making our cars.

All the proposals for the tunnel, 520, and other car based projects are promoted as if they will be open the day after the current roadway is closed. In reality we will have 5-15 years of working around the closures of these thruways before they are reopened.

We won't be able to drive to work in Downtown OR Redmond, work ONLY weekdays, work ONLY between 8am and 5pm during the construction. Instead telecommuting, buses only during rush hour, new hours of work, re-located offices and businesses, port traffic moved to Tacoma or other West Coast ports. When they reopen are we just going to go back?

The graph of oil prices resembles that of the major stock indices in the last decade, as well as commodities of all stripes. I buy the overall argument about peak oil, but the price is conflated with lots of other issues, namely Wall Street's Fed-sponsored bubble blowing. check out the charts for copper, natural gas, gold, and to a lesser degree soybeans, cocoa, and ag commodities etc. All pretty volatile in the last decade

http://www.indexmundi.com/commodities/?commodit…

It may be Wikipedia, but:

“At the present level of technology, he believes approximately 10% of this – 1,400 km3 (4.9×1013 cu ft) (49 TCF) – could be recovered.[119] This is enough to satisfy approximately two years' of total U.S. consumption”

Golly, two years? At what cost?

Also, Instead of designing a new kind of automobile, we need to think about a post personal automobile world. Until we do that, we do nothing.

Nuclear, hot-rock, geo-thermal, wind, solar, tidal, wave, etc.

The roads will be maintained in the same way that rail will be maintained and the cars will be made of more plastics (from soy of course) as will the trains, right?

Currently the natural gas reserves are estimated to be good for about 150 years.

Building, running and maintaining rail system takes a huge amount of energy. Check on the energy costs of drilling the tunnel through Capitol Hill.

Go check out the book Limits To Growth from the seventies – if I remember correctly we should be just about out of fossil fuels right about now.

Natural gas will provide the transition to alternative sources.

Uh, I believe that's what Dan does in pretty much every one of his posts (e.g., questioning the need for a tunnel to replace the viaduct, promoting dense mixed used communities in urban areas, etc.)

We're all going to convert our cars and gas stations to CNG in the next few years? Natural gas isn't a transition technology – it's another fossil fuel that runs internal combustion engines. At best it's continuing our addiction to greenhouse gas emitting fossil fuels for longer.

No we will convert to electric cars. Electricity will be produced in transition with NG. NG derives much of its energy from hydrogen which turns into water when it is burned. NG is much cleaner than oil and much, much cleaner than coal.

NG will be the transition fuel, whether you like it or not.

But we don't currently burn much natural gas for producing electricity – it's too expensive to use except in peaking plants. As a nation, we'll end up buring more coal.

Converting all of our cars to electric is a very expensive proposition. Batteries are complex and expensive to build even at mass production scale. The result will be far less driving.

Dan,
You don't see the connection between oil, walkable urbanism and deterring aggressive panhandling? (No quotes — it's a for real problem.) Tell me that you forgot about making comfortable cities (safer, for one thing) so that people can walk more so they can use less oil? Surely it just slipped your mind.

The “projected increase” in oil demand is “optimistic” too. It won't become a reality unless we keep building massive new highways instead of mass transit!

Matt – NG plants are replacing coal fired on a regular basis. It's happening now and with proper legislation, more so in the future. NG plants are the least polluting of all carbon based generation. Most of our plants are coal fired and no matter what Obama said there is no clean coal technology.

We will not convert our cars but the power source will be converted over time. I'm going to buy an electric car, perhaps a Volt.

Today is the signup day for the Leaf.

Battery technology is making strides every day. The more advantages given to high mileage cars the faster people will buy them.

Matt – more on NG – 22 minutes ago
http://www.google.com/hostednews/ap/article/ALe…

Gov. Bill Ritter signed the bill into law Monday while surrounded by representatives of the unlikely alliance who now hope to persuade other states or even Congress to rely more on natural gas to reduce pollution and greenhouse gases. Minneapolis-based Xcel Energy Inc. also backed the new law, which lawmakers rushed to pass to head off expected stricter federal emissions rules and to boost natural gas drilling.
The coal industry, which spent nearly $2 million opposing Colorado's legislation, called the law a gas giveaway and said it would cost hundreds of jobs in mines, on the railroads that move the coal, and at coal-power plants, which are more labor intensive than gas-fired ones.
The bill had been quietly the works for months before the legislative session began in January, and Colorado Mining Association President Stuart Sanderson criticized those behind-the-scenes negotiations for excluding the coal industry.

“never shut up about how spending billions on car mega-infrastructure like tunnels and bridges is a very bad idea”

Electric/natural gas cars are the future … the entire American lifestyle and economy is built around cars, so regardless of what they use as fuel cars WILL be around 5, 10, 20, 50 years from now.

I admire the optimism and brave talk about the “post-automobile' world … by the time that world actually happens, personal transportation is gonna be the least of mankind's worries.

“Typical thermal efficiency for electrical generators in the industry is around 33% for coal and oil-fired plants, and up to 50% for combined-cycle gas-fired plants.”

Tangent – electric cars operate at close to 100% efficiency so using the NG to produce electricity and transmitting it means about a 50% overall efficiency, better than burning the gas in an internal combustion engine.

Not only will cars be around, but so will buses and trucks.

Nissan Leaf, solar panels, home windmill, invest in planet cooling technology.

This is good news, and I'd love it if NG replaced coal today. But until and unless we regulate carbon, this will only make a small dent in our reliance on the evil stuff.

This weekend I stormed out of the KC Republican Convention because I was insistent that they add a plank that Washington State “foster private investment in Hydrogen Infrastructure and Industries”.

No worries. In the future we'll all be able to fill our tanks with “unidentified projects.”

“Their vision of downtown is a completely car-dependent economy for the foreseeable future.” – its more than a vision, its an economic reality. They are structured, physically, around moving vast numbers of people into the downtown core daily – and most are not arriving by transit – yet. Sadly, the suburbs also have a similar “vision”.
A big part of the problem is MSFT employees that live in Seattle and white collar office tower workers with families in the burbs. This reverse commute (cause we can) has got to stop – not made easier by investing billions into expanding 520 or adding light rail to it.

Make Redmond “hipper” and add family housing and amenities into Seattle and you'll get a lot closer to fixing the problem. .

I've spent a lot of effort following the work of Colin Campbell, Matthew Simmons, and others on the issues of energy production. It is a serious and important matter, but I have come to the conclusion that the scenario that this post alludes to is too pessimistic for several reasons.

Hubbert linearization (the tool often used to predict future production) has historically underestimated total production. I think that any effort to use the method for world production will even more severely underestimate production since Hubbert linearization has no mechanism to take price signals into account.

Regarding “unidentified projects” that several people scoffed at, any production model produced at any point since the late nineteenth century would have had a significant “unidentified projects” component for 20 years in the future. The development of new discoveries and revisiting of old discoveries is a fairly predictable factor, and a large portion, if not the entirety, of the so-called unidentified projects should be expected to materialize.

Matthew Simmons in particular severely underestimated US natural gas production. Even the EIA, which Simmons criticized as too optimistic, underestimated. In particular, few prognosticators were able to predict the expansion of so-called “unconventional gas” over the past decade. The experience with natural gas in North America makes me wonder what will come of unconventional oil sources, though I admit that Canadian tar sands, oil shale in the Rockies, and the Venezuelan shale face substantial technical hurdles that might not be solvable within 20 years.

The technical points matter because seemingly minor things can point the way to radically different solutions. I would by no means claim that we don't have an energy problem. But my somewhat less pessimistic view opens the door to heavy investments in more efficient automobiles, including electric cars, efficient buildings and appliances, and reworking of the financial system to be less dependent on debt. Such changes are more in line with where American infrastructure, economics, and values are at the present time than a radical redesign of the cities.

““By 2012, surplus oil production capacity could entirely disappear, and as early as 2015, the shortfall in output could reach nearly 10 MBD.””

Whoever wrote this is an idiot. As long as there is a free market in oil, there is no such thing as a “shortage.” There will only be price hikes, which will bring demand into line with supply. Thus there will be no “shortage” of oil.

The U.S. could probably cut its consumption of oil in half within a couple of decades with very little problem. And, if the price of oil rises enough, this will likely happen. When the price of gas gets high enough, people drive less.

There are so many ways that people can reduce their use of gasoline with no negative effect on the economy, and while actually saving money: telecommuting; 4-day workweeks; car-pooling; van-pooling; bicycling; walking; taking the bus. Increasing oil prices are nothing but a temporary inconvenience.

The inflation-adjusted OIL price chart is interesting, but fairly irrelevant to consumers. Take a look at the inflation-adjust price of GASOLINE chart:

http://inflationdata.com/Inflation/images/chart…

Except for a few very short-lived spikes over $3 per gallon, in 2009 dollars, gasoline has been between $2 and $3 per gallon pretty consistently between 1920 and the present. The only notable exception was from about 1986 to about 2004, when gas was below $2 per gallon in 2009 dollars for almost 20 years.

Not to worry.

Interesting that this discussion (on a topic that is crucial to our shared future) ignores what most exacerbates the looming problems: Too rapid (plus being incentivized) population growth. Thus individuals acting to limit impact is negated by 100s of thousands coming into state, and millions into the nation each year. The overwhelming post-1970 population-growth factor is illegal and legal immigration driven into high gear in this state by legislation that makes not coming here relatively impossible. Consequently we are in high gear for maximizing unsustainability through depletion of energy resources, endemic pollution and ecological degradation, costly infrastructure problems and congested transportation.

One more comment is necessary. Cheaply available conventional sources of natural gas are almost completely gone. The oil shale (unconventional)sources require increasingly expensive, up-front investment and each drill site lasts approximately three months. Consequently, the expense is huge and getting larger, and the investment depends on a healthy economy. Again, too rapid population growth exacerbates the unsustainable tendencies involved.

I'd like to know more about this comment:

“accepting that Washington State law prohibits spending gas tax revenue on anything but roads”

Which law? In which forums has following this law stymied discussion?

I'm kind of new to the ins-ands-outs of this discussion and some background would be helpful. Thank you.

In a dynamic regional economy there will be new Microsofts and new Amazons, etc. popping up in various locations. People will live wherever they choose. The solution is efficient, long-term, ethical mobility throughout the region. We can do this.

Western Washington has one coal plant on-line now. It is likely to be converted to NG. We also have several active NG plants online.

Interesting piece with great links about the coal plant/NG and current regional demand last week from Sightline here: http://bit.ly/dswVYm

Good info about regional power supply system here: http://www.nwcouncil.org/energy/powersupply/Def…

Roads & pavement interests won two important legal/legislative victories over the decades. 1-The 18th ammendment restricts fuel taxes to roads projects. 2-The state transpo department budget is firewalled from the state general budget.

So, if you want to enact major reform, look at these two areas.

Thanks!

last i heard, we are…anything change on the 520, AWV?

In making that 'transition' there is a contradiction: On the one side there is the oil [price] crisis that will make economic growth so much harder or impossible, and will cause successive recessions or even depression. On the other side people are expected to buy e-cars that are much more expensive and will get more expensive because of expensive oil, less practicable, and don't exist yet in sizable numbers. Who is going to do it? It's not a solution that scales fast enough. Especially if during the transition the economy has to carry all the other hundreds of millions of conventional cars (we are approaching a billion) on which the economy runs. So yes we will see some e-cars but how many, how fast? Mostly, we will probably see one dominant thing: “demand destruction” aka “economy destruction” and curtailment.

Dan is propagating for all these “low-tech” solutions because they have been known to work for millenia and are very effective although they are difficult to implement retroactively. The high-tech solutions are at best experimental and will take a very long time to scale if ever. At worst they are a cruel hoax (see hydrogen cars).

Yes, high prices will bring demand into line with supply. But that will happen via a long recession, a most unpleasant way to do it. Every major price spike has coincided with a severe recession. There is no reason to think that next time all people can immediately and at the same time start to bike, take the bus or train, car-pool, buy a more efficient car, move closer to work, etc. It didn't work in 2008 as much as it didn't work in the seventies. As you said, it takes decades to make big efficiency gains. In the meantime recession & curtailment will be a hard taskmaster. If the oil output starts declining permanently then we will just be chasing the crisis for a long time — permanent recession.

Secondly, you assume there will be a free market and oil will remain fungible. But if I were in charge of an oil-exporting country and every last person on earth had come to know the permanent nature of the oil crisis, why wouldn't I start giving resource nationalism a good look. I could start capping production and exports and make my domestic economy and population my priority. Kuwait did it and Saudi Arabia will be compelled to do the same because of its exploding population. 80% of reserves are in the hands of national oil companies. This doesn't look good.

ZPG

The new sources of gas are plentiful and cheap.

That's all very nice. But if running on oil couldn't compel us to transition to a mostly-electric transportation infrastructure, what makes you think that running on natural gas could?

Electric cars were in fashion a hundred years ago. There is a reason why mass motorization didn't happen until oil and combustion engines were produced en masse. Fuel cells and batteries were invented before the combustion engine and yet we still drive around in oil-powered cars. CNG cars may be added to that mix but a serious change-over to that or electric cars will only come because of scarcity of oil and its collateral pain. Beggars can't be choosers if the 'best' transport fuel falls away. Since the alternatives are inferior in one way or another this will involve less driving.

We are not driving the increase in demand. OECD demand may have peaked but emerging economies such as China, India, Brasil definitely haven't. China's car fleet is growing almost exponentially (see http://www.theoildrum.com/node/6126 ), ~30% every year and if it holds up China will have more cars than the US by 2017. This is a country with a booming economy, 1.3 billion people, a middle class of 300+ million, and a car fleet of just 40 million. Car ownership in developed economies is usually [more than] half of population.
“Do the math!” sounds mentally sadistic at this point.

How is this efficient or ethical? Look at the amount of land this requires for all of those interconnecting roads and large houses with big yards.

Then compare this to a low-mobility case with tall condos next to tall offices. With more people near their work, school, and stores you need far less transportation fuel, pavement, and deforestation.

I love the Amazon is choosing to build their offices in the city. I'd love for MSFT to do the same (at least Bill's putting his foundation here).

By the way, of the 10+ million cars sold last year in China only ~300 were electric cars from 'BYD', the electric car company that everyone talks about. “Build Your Dream”, very fitting!
Not that those production numbers by BYD won't be increased significantly. It is quite likely that they will be producing thousands or even hundreds of thousands of such cars per year (sometime…). But recognizing the size of the [coming] Chinese fleet, it will only make a miniscule difference in China. Worldwide it won't matter a damn.

I mostly agree. One point though regarding oil shale. That will never make a significant contribution to oil supply at today's levels. It is well understood that this very low-quality oil always needs more energy (along with a lot of water) to be produced than it actually delivers. In the only commercial operation todate in Australia that handicap was sidestepped by burning oil shale to heat oil shale. Ironically the company was shut down in 2003 because of rising oil prices. High diesel prices made mining oil shale more expensive and therefore the whole enterprise uneconomic.

To your last paragraph: I think the central problem of peak oil is that it appears in the short-to-medium term while almost all solutions require a long period to work. Even a “radical redesign of cities” would take a long time to result in an actual 'radical rebuild of cities'. That's why I think such changes as you describe will only be made in earnest because of a crisis. It may even be that those necessary changes can't be made once a crisis hits and diminishes our ability to do things.
I hope my pessimistic view (“People only learn through pain.”) is wrong. But Business-As-Usual is designed primarily to sustain Business-As-Usual (see financial system). Even if we have the time to make gradual changes, that time is shortened by populous emerging economies accelerating into development.

It did work in 2008. That price spike lasted less than a year, after which gas prices plunged to their lowest levels in a long time. Currently, gas prices are back within their “normal” range of under $3 per gallon, nationally (as of yesterday, the average price of gas in the U.S. was $2.86).

The current recession was not caused by the short-lived increase in gas prices. It was caused by the housing bubble and financial crisis, which had nothing to do with the price of gas.

Many oil-producing countries are extremely dependent on exporting oil for their income. If they were to stop selling oil, where would they get any money? They don't produce much of anything else. They are going to eat oil? That does not seem like a particularly intelligent strategy for them, either in the short term, or the long term.

Your “normal” prices were inconceiveable to most people ten years ago even adjusted for inflation. The oil price chart above suggests a 'normal' price range for crude at $20 pre-spike, which has now settled into a 'normal' range of $80. The five year long buildup to the 2008 spike happened because spare capacity vanished and a small gap between supply and demand opened up. What will happen if spare capacity vanishes again and a big 10% gap opens up? The industry now can't do much about supply for 2012-2015 since projects take at least five years to complete. 'Normal' prices will probably settle at an even higher level after another longer spike. Those new 'normal' oil prices will make an economic rebound pretty much impossible.

The current recession was at least exacerbated by high oil prices. I'd say in some parts of the country where people have to drive a lot (exurbia, …) it did cause the recession by eliminating disposable income. Which lead to decreasing home values and foreclosures and so forth. Next time we won't have the housing bubble as an excuse.

Large oil-exporters such as Saudi Arabia have some leeway to reduce exports -especially when prices are high- because they export much more than they use. Others will be forced by declining/stagnant production and increasing domestic use to skim exports first then domestic use later (good luck), and will eventually turn into oil-importing nations. None of them will have much spare capacity to export more. So for the exporters it's not a pretty scenario either. It's just better than being an importer.

Well, ZPG, you might check out the biggest Natural Gas company in the indigenous U.S., Chesapeake Energy's, history. It had to sell off holdings a couple of years ago in order to finance continuing and necessitated drilling in Bartlett when the economy dipped. The word “cheap” is relative to capability of economy to provide financing of ever-more expanding efforts to find the resource, at greater cost plus wider polluting of environment due to necessity of using extensive water resources. Your use of words “cheap” and “plentiful” are very relative. And they escape addressing point of the impact of continuing unsustainable population growth.

I agree with you about the benefits of living close to work, and in general, siting a full range of human services (groceries, medical, childcare, education, libraries) close to work. And I agree with you about the ethical implications of some residential designs. Those consumptive designs should be regulated, probably by making their owners pay the true social cost.

Where I take exception is that I don't know what mechanism you think you might have to keep people from living where they wish to live. I also don't think you can predict where the next generation of Fortune 500 enterprises will bloom and choose to site themselves in the region.

A city, a metropolitan region, should be a place where one can move freely without irresponsibly releasing carbon.

“I don't know what mechanism you think you might have to keep people from living where they wish to live”

I know exactly the mechinism that we've been using to do exactly that: zoning. You've probably noticed that housing prices in the city are much higher than the suburbs. This higher price represents a higher desirability – people want to live in the city, there just isn't the supply available to meet the demand. Why isn't there enough supply in the city to meet the demand? Because people in the city long ago decided there was about enough of us here, and limited the amount of development that can occur. The mechinism I propose is to ease these restrictions. We don't have to get rid of them, and zoning can be useful in shaping the way we build our city. But expanding our higher-density areas into SF zones and increasing the allowable height in these zones would be a great start.

As oil prices increase, demand will increase for these short-commute residential areas. We need to allow them to be built up to meet this demand, and install good in-city transit to increase this desirability further.

Matt: I agree with your design principles, zoning etc. But you are not going to stop some of the people that work on the eastside from living in Seattle.

Adding to [WJP]'s comment, I believe oil prices directly popped the real estate bubble. Before 2007 our country was in a building boom, trying to keep up with the cheap loans made possible by CDO's formed to give safe, low-yield investments to large institutions. This construction wasn't occuring as much in our cities as out in the far suburbs and exurbs. People that really shouldn't have been qualifying for loans were buying these houses out in the middle of nowhere, which were heavily marketed with low prices.

Of course, these distant commutes come with very high commute prices that aren't considered in a regular loan process, let alone a sub-prime loan process. As gas prices shoot up people suddenly have trouble making their mortgage payment. To make things worse the high price of oil brought about high prices of most everything else, including food. The least secure new homeowners start missing payments, forclosures begin, housing prices go down, construction stops, people lose jobs… well, you know the rest of the story.

Dave,
That doesn't solve the problem that we need to create more of that dense urban, mixed-used communities. The real problem is much deeper than the one that Dan addresses daily. His a a reactive agenda and not a proactive solution. We need to be addressing the future not the hear and now. His kind of thinking is what got us into this mess. Dan is late to the party and you all are championing his painting arrival. Pat yourself on the back for being just as late.

Rich,

Watch out, Matt tends to simplify housing trends to supply and demand with out much knowledge about the cost of construction. In the same paragraph above he contradicts macro supply and demand with scarcity of resources.

He then suggests that expanding high density zoning into single family zoning is a solution is not true to the area of Seattle he refers to (and the original article). Matt is talking about Downtown Seattle. He is not talking about undeveloped neighborhoods. He maybe talking about places like Capital Hill and Ballard but both those parts of Seattle, like downtown, already have up-zoned areas to develop. It is not an entirely true statement that Seattle is up-zoning Single Family zoned property. Up-zoning maybe happening Seattle, but it is not being replaced systematically with higher density.

The real issue that I see in your argument is repurposing developed suburban land into something more that allows for more density without dismantling or destroying the resources that already exist. Figuring out how to insert more people, jobs and resources into the non-high dense neighborhoods is a real problem we face. As you feel, people will want to stay in the suburbs (I too agree). But, the way they live there is becoming less sustainable. We need to address that problem. Building density in cities will cure some of that, but it is not the end-all solution assumed by Matt. We need a multi-point solution to our current and future housing needs. A one point solution is what we have done in the past and has concluded in where we are now. One point solutions need to end today! Solutions with flexibility and that are not reliant on Macro Economics need to be discussed and implemented today.

I applaud you for thinking about the out-laying areas of our metropolis and looking for solutions. Please keep in mind the merit that Matt and Dan post here but take it with a grain of salt because it is one solution to a problem to with many facets.