Oil Peak, Facts and Policies Energy Policy Gary Flomenhoft, Fellow Gund Institute Lecturer, Community and Intl. Development

Fuel Domesticated Animals Labor Work Done in the U.S. Economy,

Composition of U.S. Energy Use wood animal feed coal oil gas electricity Percent of total energy use

WORLD ENERGY 2004

Net Energy

Hubbert Oil Cycle Marion King (MK) Hubbert

The Epoch of Fossil Fuel Exploitation (after Hubbert, 1969) Iron in Middle East Stonehenge Built Parthenon completed Pyramids constructed Mayan culture Inquisition Black Death Magellan's Circumnavigation Steam Engine Trillion kwh per year

US Oil Extraction

World Oil Extraction

Oil Reserves

US Oil Extraction

World Oil Extraction

Source: Boyle, et al, Oxford Press

Oil consumption by area

OIL AND GAS LIQUIDS ASPO Scenario

World Oil Extraction

World Oil Flows

Oil Producers: 98 countries

Oil Producers: 64 from 98 in decline, 60 terminally

Oil Watch Monthly: October 2007

Business As Usual-EIA

Predictions

Predictions

Real Price of Oil

$145 $56.34 May 18, 09

World Oil Extraction

Dumped Gas Hogs 1974 Lincoln~8mpg 1974 Corolla~30mpg

Jet Industries: Citi-Car (Beaumont) ElectricarLectra 1980’s 2nd Wave of EVs “Better batteries 10 years away”

WORLD ENERGY

(61% FF=8.8%FF) = 11.4% Fossil Fuels

How VT Heats 86% Fossil Fuels

How People Move-USEIA

Hummer H1 Sticker price $106,185 Current law Equipment deduction $25,000 Total tax deduction* $60,722 Bush economic plan Equipment deduction $75,000 Total tax deduction* $88,722 * Includes bonus tax write-off enacted by Congress in March 2002 and a deduction for normal depreciation. Sources: Detroit News research, IRS, Taxpayers for Common Sense Gas Hog Tax Credit

Source: EPA

Policy Recommendations: Guidelines 1.Eliminate perverse incentives-make money! 2.Provide positive incentives-account for externalities. ie: putting a price on carbon- make money or revenue neutral. 3.Regulate (higher mpg) 3.Spend money The playing field is NOT level. Fossil Fuels have 100 years of subsidies,ignoring external costs, and a huge lobby in DC. Don’t expect the “free market” to take care of it.

WHAT TO DO? Reactive or Pro-active? WHAT DON’T WE HAVE? Oil-zero Coal-zero Nat Gas-not much (landfills) Why promote consumption of something we don’t have? * Conduct an audit of perverse incentives promoting FF use. Eliminate perverse incentives.

WHAT TO DO? DEALING WITH PEAK OIL IS GOOD FOR Climate Change Vermont Economy Should do it anyway

WHAT TO DO? Provide incentives Ex: Germany Policies, Market-based Instruments: Tax & Rebate on Fuel (tax cut): Diesel/gasoline $ /gallon Funds rebated to payroll taxes-89%, efficiency, and RE Cap/trade for CO2-powerplants and industrial heat Feed-in Tariffs: Wind=$.1149, PV=$.6385, hydro=$.1055, biogas=$.1551 No costs to government Results: PV Industry: 2715 MW installed, 52% of world total, 40,000 employed (US has 360 MW installed or 13% of Germany) Wind Industry: 22,247MW, 28% of world total, 82,000 employed (United States 16,818MW) Biomass sector 95,400 employed Total: 217,000 employees in RE ~107,000 FF & nuclear

WHAT TO DO? Reactive or Pro-active? WHAT DO WE HAVE TO WORK WITH? Trees Farms Cows Land Wind Sun Big and Small Hydro Smart People Indigenous Energy Industry Entrepreneurs

WHAT TO DO? Electricity VT Yankee = 550MW CT River Dams-567MW. Dams = $160 Million/year revenue. Buy the dams. Use eminent domain if necessary Fast-track small hydro-up to 400MW Approve more wind farms More Wood chip plants Etc.

WHAT TO DO? Heat All-fuels efficiency/ weatherization District heating and co-generation Biodiesel heating fuel Wood and wood chip/pellet heating Building codes requiring passive solar, thermal mass, window insulation, Solar hot water Wood stoves High Performance Schools Energy Program Cap/dividend on carbon-heating fuel

WHAT TO DO? Transportation Hybrids Plug-in hybrids Electric vehicles Alternative fuels, ethanol, methanol (flex-fuel), biodiesel Trains Public transit-Jitneys Bike/pedestrian paths Tax/rebate on fuels Cap/dividend on carbon-vehicles

WHAT TO DO? Agriculture Don’t turn food into fuel Biodiesel: waste oil, algae, non-food crops Methane digesters: “Cow-power”

Crisis or Opportunity We will shift from Fossil Fuels. Will we be Pro-active or reactive? It’s up to you.