How Peaking World Oil Production Will Force Us To Evolve
August 13, 2008
By Charles Cresson Wood
At this point it is no longer a question whether world oil production will peak, although the exact date of this peak is certainly still in question. Recent books such as Twilight In The Desert by Matt Simmons authoritatively document that even the most reliable long-tern sources of petroleum, such as Saudi Arabia, will soon provide much diminished quantities of oil. From the standpoint of a futurist and strategic planner, one can of course see a wide variety of resulting implications, many of which should now be the serious concerns of governments, businesses, and non-profits. For example, if world supplies of petroleum will soon be significantly reduced, and if prices of this same petroleum will soon be much higher, organizations will need to rapidly transition to alternative transportation fuels.
Beyond the whole technological transition away from petroleum — and certainly that is a large and important conversation — there are a number of ways that humanity as a species must grow both psychologically and spiritually. The ways that we will be forced to evolve are particularly relevant to governments, businesses, and non-profits because they directly affect long-term organizational missions, human resource policies, educational and awareness program goals, and organizational culture. The proactive futurist and strategic planner will increasingly need to be challenging traditional organizational approaches in these areas, asking whether traditional approaches will continue to be supportive, adaptive, and recommended in a post-peak-oil world.
This article examines only five of the many ways in which we humans will be called upon to evolve as we rapidly transition into the post-petroleum age. Each organization will need to be looking at many other impacts. This is in part because prior energy transitions, for example from wood to coal, and from coal to oil, were based on clearly preferable benefits offered by a new technology. These other transitions unfolded over a relatively long period of time, were voluntary, as well as benefits-driven. The transition away from oil and toward a variety of other energy technologies will instead be relatively rapid, mandatory, and adverse-consequence-avoidance-driven. Because this will be such a different type of transition, and because it will come on so rapidly, additional attention is needed at this point in time to fully understand and plan for its implications.
(1) All Of Our Activities Are Interconnected
Current economic systems encourage selfish behavior that causes serious externalities (unintended consequences for other people). For example, the burning of fossil fuels may allow an individual to commute long distances and thereby live in a larger house in a remote suburb. While this may please the individual involved, it also aggravates climate change, increases air pollution, and exacerbates traffic jams. The individual involved generally does not need to pay directly for these externalities, only the vehicle, the fuel, the registration, the tolls, and the insurance involved. This economic reality encourages behavior that is dysfunctional for both humanity and the planet. We as a species will soon come to appreciate that we must change the accounting and economic systems that we employ not only so that they reflect the true and holistic costs, but also so that they reflect the reality of our interconnectedness, not only with other humans, but also with nature. Not only must the accounting and economic systems be changed, but the moral system that is widely subscribed to must also change. For example, conspicuous consumption will soon give way to conspicuous conservation as a behavior pattern worthy of emulation.
(2) We Must Learn True Cooperation With One Another
In America, one of the still-prevailing cultural ideals is individualism. Exemplified by the image of the cowboy in the wild west, this rugged individualism and image of independence encourages behavior that will soon be seriously dysfunctional, if it is not already. For instance, this individualism, in its extreme, indicates that we must have separate and individually owned devices for everything that we need. Reflecting this, to be considered successful, some people believe that they must have our own personal car. The future high cost of transportation fuel, and the future relatively high cost of maintaining a separately owned vehicle, will instead mean that a great many people will need to share vehicles. This sharing will take the form of greater engagement with carpooling, car sharing, ridesharing, public transportation, and the like. Our schedules will accordingly need to be more tightly synchronized with those of the people with whom we share transportation vehicles. This need not be a hardship; it could instead be an opportunity for additional socialization. New computerized tools, such as pickup carpools arranged dynamically via cell phone, now support this interconnected behavior. Beyond simply minimizing our personal costs, mobilization for the post-petroleum conversion effort will require a degree of coordination and cooperation not seen in prior years. For example, to minimize the cost of transportation, many regional communities are expected to reinvent themselves, so that they are able to produce essential items such as food locally, rather than having these items shipped them from far away. This interconnected mobilization work can also can be positive, pointing to the new world in which we much more willingly and considerately synchronize our activities with those of others.
(3) We Must Each Be Much More Self-Responsible
For ages, people have come to look to authority figures to take care of them. At one point, that authority was a king and/or a queen, or perhaps a tribal chief. More recently, in developed countries, it has taken the form of government officials, corporate officers, and religious organization leaders. For many, it is relatively easy to fall into line, to go with the program, to accept the instructions coming from these authority figures. The post-petroleum world will require a new self-responsibility in order to deal with a rapidly changing and largely unprecedented set of circumstances. For instance, many people in first world countries take it for granted that they will be able to obtain fuel for their transportation vehicle nearly anywhere that they go. Even in unpopulated areas, such as the desert, there are still fueling stations to be found every so often. But in the post-petroleum age, many people and organizations will manufacture, store, and consume their own fuels. Already some people make their own bio-diesel, and some organizations make their own bio-methane. In the future, many businesses will generate their own electricity, and use that not only to power their internal operations, but also their transportation vehicles. Thus the widespread currently-observed dependence on large infrastructures and central authorities, such as the major oil companies, will be markedly reduced. Emerging in its place will be a new self-help ethic where both individuals and organizations go their own way, create their own solutions, and create their own strategies for dealing with the many changes looming on the horizon.
(4) We Must Adopt A Much Longer Planning Time Horizon
Current economic structures encourage short-term thinking which often sub-optimizes managerial decision-making. For example, in publicly held companies, higher-level managers are often rewarded with a quarterly bonus based on the financial results of their organizational unit. To show a higher profit, and thus get a larger bonus, some will refrain from spending money on infrastructure investments that they know will benefit an organization in the long run. Thus some managers may not invest in the required in-house systems, procedures, and methods to support the transition to a post-petroleum world. More specifically, they may not approve funds to prepare a contingency plan that enables their organization to rapidly transition to alternative fuels such as bio-methane, when the current relatively abundant supplies of gasoline and petro-diesel are significantly diminished. Because no contingency plan was developed, they may thus jeopardize the long-term viability of their organization for their own personal gain. Not only within business, but also within government agencies and non-profit organizations, we must adopt planning systems and incentive systems that force managers to employ longer term time horizons, and then make the appropriate decisions consistent with the anticipated scenarios that go along with these longer term time horizons.
(5) We Must Live Within The Carrying Capacity Of The Earth
In the United States, existing marketing and advertising systems encourage people and organizations to consume more, hoping to thereby stimulate economic activity. This “more, more, more” approach is killing the planet and it is clear, based on the classic book by William Catton entitled Overshoot, that the carrying capacity of the earth has now been far exceeded. The evidence is all around us, and can be seen in areas such as eroding topsoil, diminished supplies of fresh water, and increasing rate of species extinction. While it may still be possible for some people to drive a large gas-guzzler of a vehicle without suffering too much guilt and verbal abuse, this will soon change. In the post-petroleum world, the energy consumed by our transportation vehicles will more nearly approximate the energy immediately available to us. For example, whatever energy we can generate with a solar array or a wind turbine, could then be used to power an electric vehicle. Living within our ecological energy budget need not be an unacceptable compromise. Today’s renewable alternative transportation fuels, notably electric vehicles, are both commercially available and cost-competitive. Living within our ecological means can be a community building activity as well as a way to help ensure the continued survival of both organizations and individuals.
In summary, rather than envisioning a series of hardships and disasters associated with the future diminished availability and higher prices of petroleum-based fuels, strategic planners and futurists can challenge themselves to envision possibilities where their organizations were able to evolve in response to the new and changed circumstances. The resulting opportunities then can then provide competitive advantages, accelerated evolutionary change within organizations, and/or innovative new ways to meet an organizational mission.
Charles Cresson Wood is an alternative fuels management consultant with Post-Petroleum Transportation based in Sausalito, California. His latest book is entitled “Kicking The Gasoline & Petro-Diesel Habit: A Business Manager’s Blueprint For Action.” He can be reached via www.kickingthegasoline.com.