Preparation for Probable Oil Shocks
There is a great deal that can be done to prepare for
the likelihood of future oil shocks and hence to ameliorate the effects
when (or if) they hit us. Many possible precautions will be
"no-regrets" options already justified on equity, environment, health,
social or economic grounds. Australia's existing reserves of
uncommitted natural gas coupled with local understanding of demand
management (especially in water use efficiency and TravelSmart
individualised marketing) provide an encouraging opportunity for the
nation to both forecast and to weather the coming storms better than
many other regions. It is particularly important that the issues be
tackled seriously and urgently at all levels in the community. WA
Planning and Infrastructure Minister, Alannah MacTiernan (2004) said,
in opening the "Oil: Living with Less" conference "It is also certain
that the cost of preparing too early is nowhere near the cost of not
being ready on time."
Communication about potential solutions and their limitations
It will be crucially important that there be open and informed
discussion about oil depletion. Broad consideration of the various
strategies for reducing our oil vulnerability; especially their
limitations and the input energy needed, the time required and the
costs needed to implement them are essential precursors to effective
decision-making.
Contrary to many common predictions, it is highly unlikely there will
ever be a single "Magic Bullet" panacea for our oil vulnerability. A
major aim should be to reduce our very high levels of automobile
dependency. Some of the possible oil-use reduction and replacement
strategies are outlined in Figure 5.
Figure 5. An adaptation of the scenario outlined by Swenson (1998) of
the various mechanisms of bridging the coming gulf between growing
current world demand for oil and the forecast decline in the production
of conventional oil (Robinson (2002)).
Travel mode shifts: Individualised Marketing
Very substantial changes have already been triggered in existing
urban travel patterns when people are given personalised information
about the travel choices available to them. Empowering people in this
way has resulted in sustained decreases of 8% to 19% in car-kms
travelled. The oil saved by these voluntary travel pattern changes is
very significant, and shows that reducing car-travel demand is more
cost-effective than exploring for more oil.
Australia leads the world in the application of Individualised
Marketing to make very significant reductions in car travel rates.
Programmes have been completed or are underway in several states. WA
has the most extensive record with a number of very successful and well
documented programmes. The average reduction in car-kms travelled in
the completed WA projects is 13% at a benefit:cost ratio of 30:1, far
higher than those of most transport projects. Similar results have been
obtained in Europe and the US, (Robinson (2004), Socialdata (2004)).
The TravelSmart Individualised Marketing programmes in WA have covered
suburbs with some 158,000 people to date, and have resulted in the
annual saving of some 115 million car-kms, or 11 million litres of
petrol (John (2004), MacTiernan (2004)). Extrapolated to Australia's
urban population, this would equate to about a thousand megalitres of
oil saved each year. Globally, this level of travel reduction and mode
shift would save each year oil amounting roughly to the annual
production of Iraq, as an example.
Alternative Fuels
All alternative fuels to replace petrol and diesel have severe
constraints to their introduction. Enormous volumes are required to
replace a sizeable proportion of our current liquid fuel usage, and the
timescale for their provision in these volumes is very short. For
instance, diverting Australia’s entire wheat crop to produce ethanol
would replace less than 10% of our oil usage. Hydrogen is an energy
carrier, not an energy source. It requires large amounts of energy for
its manufacture and for its distribution. For the foreseeable future,
the vast bulk of the world’s hydrogen will continue to be made from oil
and gas. The ‘Hydrogen Economy’ may well turn out to be just a
pipe-dream like fusion power. Concentration on hydrogen diverts
attention and resources from practical and immediate fuel conservation
options. The most likely alternative for our current cheap plentiful
oil will also be oil, but much more expensive and less plentiful oil.
Technological changes
It will be very risky indeed to rely on unproven technologies
becoming available on such enormous scales within a decade or so, which
is the timeframe likely to be required if the Big Rollover forecasts
are accurate. There are around 14 million motor vehicles in Australia,
and at only $25,000 each, a fleet replacement exercise to change them
to other technologies or other fuels would need the outlay of $350,000
million, which would be diverted from other community and Government
needs. Currently half the registered motor vehicles are more than ten
years old, and 20% more than 20 years old. Normal fleet changeover
rates are actually very slow. Half of today's new cars will still be on
the roads in 20 years (BTRE (2002))
For instance, it has taken Australia almost two decades since 1985 to
switch from leaded to unleaded petrol (Figure 6), a very much simpler
technological change indeed than a conversion to fuel-cell cars, for
instance. This change was mandatory for all new cars purchased from 1st
January 1986.
Figure 6. Example of the inevitably slow rate of introduction of new
technology into Australia's vehicle fleet. Unleaded and leaded (or LRP)
petrol sales, Australia, from 1987 and extrapolated to 2008,
(Australian Institute of Petroleum at www.aip.com.au), following
mandatory introduction of emission-control engines in new cars in 1986.
The introduction of hybrid vehicles and fuel cells is likely to be much
slower as the technological differences are much greater.
Suggested Oil Dependence Reduction Measures
Australia is very wasteful of energy in general, and of petroleum
fuels in particular, and there are a great many measures which can
reduce this wastage while either improving or not diminishing our
quality of life. Changes to the built environment can substantially
improve transport energy efficiency if our automobile-dependent
perspective is cast aside. Sadly, all too many planners and transport
decision-makers give an impression of having a windscreen-shaped view
of the world. There is great scope for simple and cost-effective steps
to make our cities and towns far less automobile dependent and much
friendlier and more efficient for walking and bicycle transport.
In its submission to the COAG Energy Markets review, BP recommended :-
"Achieve a step change in energy
efficiency – BP knows from its own experience that significant cost
savings are available through greater energy efficiency. Better energy
efficiency is the “low hanging fruit” of the energy challenge." (BP
(2002))
There is a wide range of oil consumption reduction measures outlined by
Denniss (2003), in Robinson (2002) and (2003) and by the Sustainable
Transport Coalition (2004). A crucial first step would to review and
remove the inequitable perverse subsidies which fund and encourage
excessive private motor vehicle use in our cities and towns.
"Perverse policies, that is policies
which actually reduce the sustainability and efficiency of the
transport sector, continue to be implemented, and continue to receive
the support of various levels of government in Australia". (Denniss
(2003))
These include 10% Federal tariff subsidies to fuel-inefficient urban
4WD vehicles; FBT regimes which reward heavy car use and penalise
modest usage; and the GST which increased the price of public transport
while leaving that of petrol unchanged. There are massive Federal funds
to build freeways, but no specific allocation at all to build
cycleways. State Governments have high fixed "vehicle ownership"
charges rather than "vehicle use" charges (especially for third party
injury insurance). These mean that those frugal with car use are forced
to subsidise the profligate users. Local Government ratepayers are
forced to pay more for planning and engineering staff who live long
distances away (because of high company car package costs) than they do
for local staff who are of more value to residents because of their
better local knowledge. The provision of salary-packaged vehicles mean
that most decision-makers do not pay directly for their petrol and
hence tend to have an automobile-dominated outlook. Even supermarket
chains like Coles and Woolworths now force shoppers who use cars only
rarely to subsidise the gas-guzzlers due to the inequitable petrol
discount schemes, funded by increased supermarket food prices.
Like BP, the author recommends starting with the low-hanging fruit, of
simple good engineering and urban planning to end the addiction to
continual expansion of facilities for motor vehicles. For example, the
overall disjointed and low standard facilities for pedestrians and
bicycle transport users are an indictment of past and current planning
and engineering practices throughout Australia.
People must look now towards evaluating the oil shortage scenarios
outlined, so there is much more information on which to base the
crucial decisions which must be made soon. Making decisions by default,
using the current business-as-usual forecasts will prove extremely
costly to nations, communities and individuals.
There is enormous scope for economic gains and for the avoidance of
serious losses if the community, the professions and governments can
turn away from car-dominated thinking. People who take notice of the
oil storms now appearing on the radar screens will be far better
equipped to help the community survive the large changes that are very
likely to sweep through Australia in the near future. |
Oil Depletion Overview 
