Peak Oil
Wednesday, February 10, 2010 at 9:07 
I went to the launch of the second report of the UK Industry Taskforce on Peak Oil & Energy Security. Philip Dilley, Arup Chairman, started things off mentioning our increasing reliance on just-in-time logistics. This is something I'll be coming back to later in relation to Haiti and resiliency - a fundamental problem our economic system faces. Jeremy Leggett of Solarcentury mentioned the possibility of shocks to oil supply, too: a real risk to the ability of our economy to function given low inventories and the exaggerated interdependency created by modern logistics.
Meanwhile, back at the launch: My friend John Miles (also at Arup) contended that OECD oil demand could peak now - but that the BRICs countries will keep powering along, literally, and drive up demand, and prices with it. At the same time, the UK is becoming a net importer of energy. This doesn't bode well for Britain. And Ian Marchant, of Scottish & Southern Energy, projected that as coal goes out of fashion, we could end up in a gas shortage too. SSE's emphasis is on reducing demand - households have on average reduced their demand by 15% in the last few years, through condensing boilers, insulation and the like - not to mention rising prices, as my neighbour from the Energy Saving Trust whispered to me! Ian thinks we can get that down by 50%, but he's focusing on the design of new housing. I'm more interested in the existing building stock: we've already got it, after all...
Nice to see Brian Souter of Stagecoach, and Richard Branson of Virgin, talking about the need to deliver demand reductions. Brian - in his wonderful brogue - suggested a carbon tax instead of the lowest rate, redistributing wealth from the rich to the poor.
Of course, the risk we're dealing with needs to be dealt wth by 2014-15 - even shorter-term than with carbon, you could argue. Will Whitehorn (Virgin) and Ian Marchant argued that the North Sea can still provide up to 60% of UK demand by 2020, but only if tax on North Sea extraction is reformed.
Of course, I've got an axe to grind when I put on my localCarbon hat. I was struck by the emphasis on the supply side of energy as compared to the demand side. Have we given up on efficiency? What about fuel poverty, as highlighted by the gentleman from the Association for Conservation of Energy? Or is it just never going to be enough? Will demand peak before supply? No-one knows, but while the chap from DECC who responded defended government's strategy, he admitted that we probably need to be doing more.
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