Executive summary
This report is intended as a non-technical overview of the prospects for known energy sources to supply society’s energy needs at least up to the year 2100. It serves as a layperson’s introduction to the concept of net energy, or energy returned on energy invested (EROEI). It also discusses energy transition scenarios, showing why many that have been published up to this time are overly optimistic because they do not address all of the relevant limiting factors to the expansion of alternative energy sources. Finally, it shows why energy conservation (using less) and humane, gradual population reduction must be key strategies to achieving sustainability.
Overview
The world’s current energy regime is unsustainable. This is the explicit conclusion of the International Energy Agency, and it is also the substance of a wide and growing public consensus ranging across the political spectrum. One broad segment of this consensus is concerned more about the climate impacts of society’s reliance on fossil fuels; the other is moved more by questions regarding the security of future supplies of these fuels—which, as they deplete, are increasingly concentrated in only a few countries.
To say that our current energy regime is unsustainable means that it cannot continue and must therefore be replaced with something else. However, replacing the energy infrastructure of modern industrial societies is no trivial matter. Decades have been spent building the current oil-coal-gas infrastructure, and trillions of dollars invested. Moreover, if the transition from current energy sources to alternatives is wrongly managed, consequences could be severe: there is an undeniable connection between per-capita levels of energy consumption and economic well-being (see Robert Ayres and Benjamin Warr, Two Paradigms of Production and Growth). A failure to supply sufficient energy, or energy of sufficient quality, could undermine our global economic future.
It is a commonly held assumption that alternative energy sources capable of substituting for conventional fossil fuels are readily available, whether fossil (tar sands or oil shale), nuclear, or renewable. All that is necessary is to invest sufficiently in them, and life will go on essentially as it is.
But is this really the case? Energy sources have varying characteristics. And it is the characteristics of our present energy sources (principally oil, coal, and natural gas) that have enabled the creation of a society with high mobility, large population, and high economic growth rates. Will alternative energy sources perpetuate this kind of society?
While it is possible to point to innumerable successful alternative energy production installations within modern societies (ranging from small home-scale photovoltaic systems to large "farms" of three-megawatt wind turbines), it is not possible to point to the example of an entire modern industrial society obtaining the bulk of its energy from sources other than oil, coal, and natural gas. The energy transition is still more theory than reality.
But if current primary energy sources are unsustainable, this implies a daunting problem. The transition to alternative sources must occur, or the world will lack sufficient energy to maintain basic services.
Thus it is vitally important that energy alternatives be evaluated thoroughly according to relevant criteria, and that a staged plan be formulated and funded for a systemic societal transition away from oil, coal, and natural gas and toward the alternative energy sources deemed most fully capable of supplying economic benefits similar to those of conventional fossil fuels.
Many readers will probably assume that this has already been done adequately. After all, it is possible to assemble a bookshelf (as this author has done) filled with reports from nonprofit environmental organizations and books from energy analysts, dating from the early 1970s to the present, all attempting to illuminate alternative energy pathways for the United States and the world as a whole. These plans and proposals vary in breadth and quality, but especially in their success at identifying limiting factors that could prevent specific alternative energy sources from adequately replacing conventional fossil fuels.
A limiting factor that is most frequently omitted from energy transition plans is net energy, or energy return on energy invested (EROEI). One reason for its omission is, as we shall see in more detail below, that it suffers from lack of standard measurement practices. Nevertheless, for the purposes of large-scale and long-range planning, net energy may be the single most important criterion for evaluating energy sources.
This report is not intended to serve as an authoritative analysis of available energy options, nor as a comprehensive plan for a nation-wide or global transition from fossil fuels to alternatives. While such analyses and plans are needed, they will require institutional resources and ongoing re-assessment to be of value. The goal here is simply to identify the primary criteria that should be used in such analyses and plans, with special emphasis on net energy, and to offer a cursory look at some currently available data on alternative energy sources, so as to provide a general, preliminary sense of whether such alternative sources are up to the job of replacing fossil fuels—and if not, what should be the fall-back plan of governments and the other responsible institutions of modern society.
As we will see, this preliminary survey yields the disturbing conclusion that all alternative energy sources are subject to limits of one kind or another, and that there is no clear scenario in which the energy from conventional fossil fuels can be replaced with energy from alternative sources without (1) enormous investment, (2) significant time for build-out, and (3) significant sacrifices in terms of energy quality and reliability.
Thus there is a strong likelihood that neither conventional fossil fuels nor alternative energy sources can reliably be counted on to provide the amount and quality of energy that will be needed to sustain economic growth—or even current levels of economic activity—during the remainder of the current century.
This preliminary conclusion in turn suggests that a sensible transition energy plan will have to emphasize energy conservation above all. It also raises questions about the sustainability of growth per se, both in terms of human population numbers and economic activity.
Limiting Factors: Energy Evaluation Criteria
In evaluating energy sources, it is essential first to give attention to the criteria being used. Some criteria merely give us information about an energy source’s usefulness for specific applications: for example, an energy source (like oil shale) that is a solid and has low energy density per unit of weight and volume is unlikely to be a good transport fuel unless it can first somehow profitably be turned into a liquid fuel with higher energy density. Other criteria offer essential information about the suitability of an energy source for powering large segments of an entire society: micro-hydro power, for example, can be environmentally benign, but simply cannot be scaled up to provide a significant portion of the national energy budget of the US or other industrial countries.
In general, society will be better off with energy sources that have high economic utility, that are capable of being scaled up to produce large quantities of energy, and that have minimal environmental impacts.
Economic utility and scalability are determined by, among other things, energy density, the nature and quantity of other resources needed in order to employ the energy source in question, and the size of the resource base. Economist Douglas Reynolds, in a paper discussing the energy density of energy sources (which he terms "energy grade"), writes:
Higher-grade energy resources have more potential for being productive than lower grade energy resources. Energy is the driving force behind industrial production and is indeed the driving force behind any economic activity. However, if an economy's available energy resources have low grades, i.e. low potential productivity, then new technology will not be able to stimulate economic growth as much. On the other hand, high-grade energy resources could magnify the effect of technology and create tremendous economic growth. High-grade resources can act as magnifiers of technology, but low grade resources can dampen the forcefulness of new technology. This leads to the conclusion that it is important to emphasize the role of the inherent nature of resources in economic growth more fully. (Should EROEI be the most important criterion our society uses to decide how it meets its energy needs?)
But economic utility is not the only test an energy source must meet. If there is anything to be learned from the ongoing and worsening climate crisis, it is that the environmental impacts of energy sources must be taken very seriously indeed. The world cannot afford to replace oil, coal, and gas with other energy sources capable of posing a survival challenge to future generations.
Here then, are some primary energy evaluation criteria. The first three together define energy density.
Weight density refers to the amount of energy that can be derived from a standard weight unit of an energy resource. For example, if we use the British Thermal Unit (Btu) as a measure of energy and the pound as a measure of weight, coal has about 12 thousand Btu per pound, natural gas about 10 thousand Btu per pound, and oil almost 20 thousand Btu per pound. However, an electric battery typically is able to store and deliver only about 100 Btu per pound, and this is why electric batteries are problematic in transport applications: they are very heavy in relation to their energy output. Thus electric cars tend to have limited driving ranges and electric aircraft (which are quite rare) are able to carry only one or two people.
Consumers and producers are willing to pay a premium for energy resources with a higher energy density by weight; therefore it makes economic sense in some instances to convert a lower-density fuel such as coal into a higher-density fuel such as synthetic diesel, even though the conversion process entails both monetary and energy costs.
Volume density refers to the amount of energy that can be derived from a given volume unit of an energy resource (e.g., Btu per cubic foot). Obviously, gaseous fuels will tend to have lower volumetric energy density than solid or liquid fuels. Natural gas has about one thousand Btu per cubic foot at sea level atmospheric pressure, and 177 thousand Btu per cubic foot at 3000 pounds per square inch. Oil, though, can deliver about one million Btu per cubic foot.
In most instances weight density is more important than volume density; however, for certain applications the latter can be decisive. For example, fueling airliners with hydrogen, which is a highly diffuse gas at common temperatures and surface atmospheric pressure, would require very large tanks; indeed, this would be true even if the hydrogen were super-cooled and highly pressurized.
The greater ease of transporting a fuel of higher volume density is reflected in the fact that oil moved by tanker is traded globally in large quantities, while the global tanker trade in natural gas is relatively small. Consumers and producers are willing to pay a premium for energy resources of higher volumetric density.
Area density expresses how much energy can be obtained from a given land area (e.g., an acre) when the energy resource is in its original state. For example, the area energy density of wood as it grows in a forest is roughly 1 to 5 billion Btu per acre. The area grade for oil is usually tens or hundreds of billions of Btu per acre where it occurs, though oilfields are much rarer than forests (except perhaps in Saudi Arabia).
Area energy density matters because energy sources that are already highly concentrated in their original form generally require less investment and effort to be put to use. Reynolds makes the point:
If the energy content of the resource is spread out, then it costs more to obtain the energy, because a firm has to use highly mobile extraction capital [machinery], which must be smaller and so cannot enjoy increasing returns to scale. If the energy is concentrated, then it costs less to obtain because a firm can use larger-scale immobile capital that can capture increasing returns to scale.
Thus energy producers will be willing to pay an extra premium for energy resources that have high area density—such as oil that will be refined into gasoline—over ones that are more widely dispersed—such as corn that is meant to be made into ethanol.
Other resources needed: A very few energy sources come in an immediately useable form; for example, without exerting effort or employing any technology we can be warmed by the sunlight that falls on our shoulders on a spring day. But most energy sources, in order to be useful, require some method of gathering or converting the energy. That usually entails some kind of apparatus, made of some kind of material (for example, oil-drilling equipment is made from steel and diamonds); and sometimes the extraction or conversion process uses some resource (for example, the production of ethanol from corn requires land, and the production of synthetic diesel fuel from tar sands requires water and natural gas). The amount or scarcity of the material or resource, and the complexity and cost of the apparatus, thus constitute limiting factors on energy production.
The requirements for ancillary resources in order to produce a given quantity of energy are largely reflected in the price paid for the energy. But this is not always the case. For example, thin-film photovoltaic panels use materials (such as gallium and indium) that are non-renewable, rare, and depleting quickly. While the price of thin-film PV panels reflects and includes the current market price of these exotic materials, it does not give indication of future limits to the scaling up of thin-film PV.
Environmental impacts: Virtually all energy sources entail environmental impacts, but some have greater impacts than others. These may occur during the acquisition of the resource (in mining coal, for example), or during the release of energy from the resource (as in burning wood, coal, oil, or natural gas), or in the conversion of energy from one form to another (as in converting the kinetic energy of flowing water into electricity via a dam and hydro-turbines).
Some environmental impacts are indirect, and occur in the manufacture of the equipment used in energy harvesting or conversion. For example, the extraction and manipulation of resources used in manufacturing wind turbines or solar panels may entail significantly more environmental damage than the operation of the turbines or panels themselves.
Renewability. If we wish our society to continue using energy at industrial rates of flow not just for years or even decades into the future, but for centuries, then we will require energy sources that can be sustained more or less indefinitely. Energy resources like oil, natural gas, and coal are clearly non-renewable because the time required to form them through natural processes is measured in the tens of millions of years, while quantities available will power society reliably for only a few decades into the future at current rates of use. In contrast, solar photovoltaic and solar thermal energy sources rely on sunlight, which for practical purposes is not depleting and will presumably be available in equal quantities a thousand years hence.
It is important to note, however, that the equipment used to capture solar or wind energy is not itself renewable, and that both depleting raw materials and non-trivial amounts of energy are required to manufacture such equipment.
Some energy sources are renewable yet are still capable of being depleted. For example, wood can be harvested from forests that regenerate themselves; however, the rate of harvest is crucial: if over-harvested, the trees will be unable to re-grow quickly enough and the forest will shrink and disappear.
Even energy sources that are renewable and that do not suffer depletion are nevertheless limited by the size of the resource base (as will be discussed next).
Potential size or scale of contribution. Estimating the potential contribution of an energy source is obviously essential for macro-planning purposes, but such estimates are always subject to error—which can sometimes be enormous. With fossil fuels, amounts that can be reasonably expected to be extracted and used on the basis of current extraction technologies and fuel prices are classified as reserves, which are always a mere fraction of resources (defined as the total amount of the substance present in the ground). For example, the US Geological Survey’s first estimate of national coal reserves, completed in 1907, identified 5000 years’ worth of supplies. In the decades since, most of those reserves have been reclassified as resources, so that today only 250 years’ worth of US coal supplies are officially estimated to exist—a figure that may still be much too optimistic. Reserves are downgraded to resources when new limiting factors are taken into account, such as (in the case of coal) seam thickness and depth, chemical impurities, and location of the deposit.
On the other hand, reserves can sometimes grow as a result of the development of new extraction technologies, as has occurred in recent years with US natural gas supplies. While the production of conventional American natural gas is declining, new underground fracturing technologies have enabled the recovery of gas from low-porosity rock, significantly increasing the national production rate and expanding US gas reserves.
Reserves estimation is especially difficult when dealing with energy resources that have little or no extraction history. This is the case, for example, with methane hydrates, with regard to which various experts have issued a very wide range of estimates of both total resources and extractable future supplies; it is also true of oil shale, and to a lesser degree tar sands, which have limited extraction histories.
Estimating potential supplies of renewable resources such as solar and wind power is likewise problematic, as many limiting factors are often initially overlooked. With regard to solar power, for example, a cursory examination of the ultimate resource is highly encouraging: the total amount of energy absorbed by Earth’s atmosphere, oceans, and land masses from sunlight annually is approximately 3,850,000 exajoules (EJ)—whereas the world’s human population uses currently only about 428 EJ of energy per year from all sources combined, an insignificant fraction of the previous figure. However, the factors limiting the amount of sunlight that can potentially be put to work for humanity are numerous, as we will see in more detail below.
Consider the case of methane harvested from municipal landfills. In this instance, using the resource provides an environmental benefit: methane is a more powerful greenhouse gas than carbon dioxide, so harvesting and burning landfill gas (rather than letting it diffuse into the atmosphere) reduces climate impacts while also providing a local source of energy. If landfill gas could power the US electrical grid, then the nation could cease mining and burning coal. However, the potential size of the landfill gas resource is woefully insufficient to support this. Currently the nation derives about 400 trillion Btu per year from landfill gas for commercial, industrial, and electric utility uses. This figure could probably be quadrupled if more landfills were tapped. But US electricity consumers use over twenty-five times as much energy as that. There is another wrinkle: if society were to become more environmentally sensitive and energy efficient, the result would be that the amount of trash going into landfills would decline—but this would reduce the amount of energy that could be harvested from future landfills.
Location of the resource. The fossil fuel industry has long faced the problem of "stranded gas"—natural gas reservoirs that exist far from pipelines and that are too small to justify building pipelines to access them. Renewable resources often face similar hurdles.
The location of solar and wind installations is largely dictated by the availability of the primary energy source; often, this is in sparsely populated areas. For example, in the US there is large potential for the development of wind resources in Montana and North and South Dakota. However, these are some of the least-populous states in the nation. There are also good wind resources offshore along the Atlantic and Pacific coasts, nearer to large urban centers, but taking advantage of these resources will entail overcoming challenges having to do with building and operating turbines in deep water and connecting them to the grid onshore. Similarly, the nation’s best solar resources are located in the Southwest, far from population centers in the Northeast.
Thus taking advantage of these energy resources will require more than merely the construction of wind turbines and solar panels: much of the US electricity grid will need to be reconfigured, and large-capacity, long-distance transmission lines will need to be constructed.
Reliability. Some energy sources are continuous: coal can be fed into a boiler at any desired rate, as long as the coal is available. But some energy sources, such as wind and solar, are subject to rapid and unpredictable fluctuations. Wind often blows at greatest intensity at night, when electricity demand is lowest; the sun shines for the fewest hours per day during the winter—but consumers are unwilling to curtain electricity usage during winter months, and power system operators are required to assure security of supply throughout the day and year.
Intermittency of energy supply can be managed to a certain extent through storage systems—in effect, batteries. However, this implies extra infrastructure costs as well as energy losses. It also places higher demands on control technology. In the worst instance, it means building electricity generation capacity much larger than would otherwise be needed. (See: Wind: intermittent Power: continuous)
Transportability of energy is largely determined by the weight and volume density of the energy source, as discussed above. But it is also affected by the state of the material—whether it is a solid, liquid, or gas. In general, a solid fuel is less convenient to transport than a gaseous fuel, because the latter can move by pipeline. Liquids are the most convenient of all because they take up less space than gases.
Some energy sources cannot be classified as solid, liquid, or gas. The energy from sunlight or wind cannot be directly transported; it must first be converted into a form that can—such as hydrogen or electricity.
Electricity is highly transportable, as it moves through wires, enabling it to be delivered not only to nearly every building in industrial nations, but to many locations within each building.
Transporting energy always entails costs—whether it is the cost of hauling coal (which may account for over 70 percent of the delivered price of the fuel), the cost of building and maintaining pipelines and pumping oil or gas, or the cost of building and maintaining an electricity grid. These costs can be expressed in monetary terms or in energy terms.
The energy costs of transporting energy affect net energy—which we will discuss next in a separate section because it is such an important aspect of the overall discussion, and because it will be a principal focus of this report.
Net Energy (EROEI)
Energy must be invested in order to obtain energy, regardless of the nature of the energy resource or the technology used to obtain it, and society relies on the net energy gained from energy-harvesting efforts to operate all of its manufacturing, distribution, and maintenance systems.
If the net energy produced is a large fraction of total energy produced, this means that a relatively small portion of societal effort must be dedicated to energy production, and most of society’s efforts can be directed toward other purposes. This is the situation we have become accustomed to as the result of having access to cheap, abundant fossil fuels.
If the net energy produced is a small fraction of total energy produced, this means that a relatively large portion of societal effort must be dedicated to energy production, and only a small portion of society’s efforts can be directed toward other goals. For example, in a society where energy is acquired principally through agriculture—which yields a low and variable energy profit—most of the population must be involved in farming in order to provide enough energy to fund the maintenance of a small hierarchy of full-time managers, merchants, soldiers, etc., who make up the rest of the societal pyramid.
In the early decades of the fossil fuel era, the quantity of both total and net energy liberated by efforts to mine and drill for these fuels was unprecedented, and it was this abundance of cheap energy that enabled the growth of industrialization, urbanization, and globalization during the past two centuries. It took only a trivial amount of effort in exploration and drilling to obtain an enormous energy return on energy invested (EROEI). But the energy industry understandably followed the best-first or "low-hanging fruit" policy of exploration and extraction. Thus the coal, oil, and gas that were highest in quality and easiest to access tended to be found and extracted early on, and so with every passing decade the net energy (as compared to total energy) derived from fossil fuel extraction has declined. In the early days of the US oil industry, for example, a 100-to-one net energy profit was common, while it is estimated that current US exploration efforts are approaching an averaged one-to-one (break-even) energy payback.(FN Hall and Gagnon)
In addition, as we will see in some detail later in this report, alternatives to conventional fossil fuels generally have a much lower EROEI than coal, oil, or gas did in their respective heydays. For example, industrial ethanol production from corn is estimated to have at best a 1.5-to-one positive net energy balance; it is therefore nearly useless as a primary energy source.
If the net energy available to society declines, more of society’s resources will have to be devoted directly to obtaining energy, and less will be available for all of the activities that energy makes possible. Thus increasing constraints will be felt on economic growth, and also upon the adaptive strategies (which require new investment—for example: the building of more public transport infrastructure) that society would otherwise deploy to deal with energy shortages. The immediately noticeable symptoms will include rising costs of bare necessities and a reduction in job opportunities in fields not associated with basic production.
Net energy can be thought of in terms of the number of people in society engaged in energy production. If energy returned exactly equals energy invested (EROEI = 1), then everyone is involved in energy production and no one is available to take care of society’s other needs. If EROEI = 100, then one person is involved in energy production and 99 can do other things—build houses, teach, take care of the sick, cook, write advertising copy, and so on. If there are two energy workers and 98 people doing other things, then EROEI = 50; and similarly with four people obtaining energy and 96 doing other things, EROEI = 25. With 8 getting energy and 92 doing other things (EROEI = 12.5) there may begin to be problems finding enough workers who are trained at getting energy while others build the tools and infrastructure (drilling rigs or assembly lines for making solar panels) that enable these energy workers to do their jobs. With 16 getting energy and 84 doing other things (EROEI = 6.25), serious problems may become apparent, since 84 people may not be enough to provide for all of the needs of the 16, given that half of the larger group may consist of children, the elderly, and disabled persons. With 16 energy workers and 42 others providing everything else, an industrial mode of societal organization may not be viable.
Archaeologist Lynn White estimated that hunter-gatherer societies operated on a ten-to-one net energy basis (EROEI = 10). Since hunter-gatherer societies are the simplest human groups in terms of technology and degree of social organization, 10 should probably be regarded as the minimum sustained average societal EROEI required for the maintenance of human existence (though groups of humans have no doubt survived for occasional periods, up to several years in duration, of lower EROEI). Since industrial society entails much greater levels of complexity, its minimum EROEI must be substantially higher.
However, in this report we will not be discussing the EROEI of society as a whole, but of individual energy sources.
Both renewable and non-renewable sources of energy are subject to the net energy principle. Fossil fuels become useless as energy sources when the energy required to extract them equals or exceeds the energy that can be derived from burning them. This fact puts a physical limit to the portion of resources of coal, oil, or gas that should be categorized as reserves, since net energy will peak and decline to the break-even point long before otherwise extractable fossil energy reserves are depleted.
Therefore the need for society to find replacements for fossil fuels may be more urgent than is generally recognized. Even though large amounts of fossil fuels remain to be extracted, the transition to alternative energy sources must be negotiated while there is still sufficient net energy available to continue powering society while at the same time providing energy for the transition process itself.
Because this report is a layperson’s guide, we cannot address in any depth the technical process of calculating net energy. However, it is important to note that the process is complex and is subject to ongoing controversy. Most of this controversy centers on system boundaries: what should be counted as an energy cost for a specific instance of energy production? For example, should we count the energy expended in the manufacturing of shoes worn by the workers on an oilrig?
The use of net energy or EROEI as a criterion for evaluating energy sources has been criticized on several counts. As just mentioned, there is difficulty in establishing system boundaries that are agreeable to all interested parties, and that can be easily translated from analyzing one energy source to another. Moreover, the EROEI of some energy sources (such as wind, solar, and geothermal) may vary greatly according to location. Advances in technology can also affect net energy. All of these factors make it difficult to calculate figures that can reliably be used in energy planning.
This difficulty only increases as the examination of energy production processes becomes more detailed. Does the office staff of a drilling company actually need to drive to the office to produce oil? Is the energy spent filing tax returns actually necessary to the manufacture of solar panels?
Yet despite challenges in precisely accounting for the energy used in order to produce energy, net energy acts as an absolute constraint in human society, regardless of whether we ignore it or pay close attention to it. EROEI will determine if an energy source is able successfully to support a society of a certain size and level of complexity. In situations where EROEI can be determined to be low, even though there is dispute as to the exact figure, we can conclude that the energy source in question cannot be relied upon as a primary source.
Many criticisms of net energy analysis boil down to an insistence that other factors that limit the efficacy of energy sources should also be considered. EROEI does not account for limits to non-energy inputs in energy production (inputs such as water, soil, or the minerals and metals needed to produce equipment); it does not account for undesirable non-energy outputs of the energy production process—most notably, greenhouse gases; it does not account for energy quality (the fact, for example, that electricity is an inherently more versatile and useful energy medium than the muscle power of horses); and it does not reflect the scalability of the energy source (recall the example of landfill gas above).
However, just because net energy is not the only important criterion for assessing a potential energy source, this is no reason to ignore it. EROEI is a necessary—though not a sufficient—basis for evaluating energy sources. It is one of five criteria that we should regard as having make-or-break status (the others, discussed above, are renewability, environmental impact, size of the resource, and the need for ancillary materials). If a potential energy source cannot score well with all of these criteria, it cannot realistically be considered as a future primary energy source. Stated the other way around, a potential energy source can be disqualified by doing very poorly with regard to just one of these five criteria.
It should be noted, however, that an energy source with a low or negative EROEI can still be useful as a medium or carrier to make other energy sources easier to use. In an energy system with many source inputs, common energy carriers are extremely helpful. Electricity serves this function well in our current energy system: it would be difficult for consumers to make practical use of coal, nuclear, and hydropower without it. But convenient negative-EROEI energy carriers need to be connected to high-EROEI energy sources—otherwise the system cannot function.
In the following discussions of specific energy sources, data on EROEI are drawn from the work of Dr. Charles Hall, who, working with his students at the State University of New York in Syracuse, has for many years been at the forefront of developing and applying the methodology for calculating net energy.
Following this consideration of known energy sources case-by-case, we will explore the prospects for combining non-fossil sources into a workable future energy system.
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