Peak oil notes - May 27

Prices and production
After falling on Monday and Tuesday, oil prices rebounded by $2.76 to settle on Wednesday at $71.51after the US stocks report showed an increase in US gasoline consumption, even as crude stocks continued to rise. In afterhours trading however, crude gave up much of Wednesday’s gain. Stockpiles at Cushing, OK declined a bit, the first such drop in ten weeks. The US consumed an average of 19.5 million b/d over the last month, an increase of nearly 7 percent over 2009.

Concerns about the future of the EU and a falling Euro continue to balance Asian demand. For now, demand from China seems to have placed a floor of around $70 a barrel on oil prices. Beijing announced that it plans to increase its refining capacity by 50 percent over the next five years – a harbinger of what is to come. China’s GDP grew by 11.9 percent in the first quarter.

The situation in Korea continues to deteriorate, with the North threatening to cut all ties to the South. The US is offering its full support to the South and is pressuring Beijing to rein in its client which seems to be out of control. So far there has been little impact from the animosities on oil consumption and most observers agree that hostilities are unlikely.

Deepwater Horizon
The attempt to plug the leaking well using the “Top Kill” procedure of pumping drilling mud into the well began Wednesday afternoon and as of early Thursday morning clouds of what is thought to be drilling mud was coming from the Blow Out Preventer – possibly a good sign. BP said it may be another day or so before it can be determined whether the effort will be successful. President Obama has received an Interior report on the Deepwater Horizon explosion and will announce new offshore drilling regulations during a noon press conference today. The President is expected to announce a continued hold on deepwater drilling permits but to permit a resumption of new shallow water drilling. New drilling off Alaska will be delayed until next year.

If the current effort is not successful, the next attempt to plug the well or at least reduce the flow will involve cutting away the kink in the bent riser pipe and attaching another riser to the remaining stem that would bring the oil to the surface. After that would come the “Top Hat” containment dome and finally the drilling of two relief wells which could not be completed until August. There is some danger that the “Top Kill” procedure currently under way will erode bigger openings in the BlowOutPreventer and permit still more oil to leak into the Gulf.

The last few days have been dominated by discussion of whether the US government has been negligent in not taking over efforts to stop the leaking well from BP. Washington contends that it has neither the equipment nor the expertise to stop an oil leak 5,000 feet under the sea and that oil industry players are the only ones in a position to stop the leak.

A major bottom-line issue in all this is what the new offshore drilling regulations will look like, how the industry will react and how much delay and cost will be added to future deepwater oil production by the new controls.

Peak oil notes - May 20Gulf spill won’t dampen U.S. appetite for oil

Gulf oil slick 'worst in US history'

Early reports are indicating that BP's risky bid to plug it’s Gulf of Mexico well appear to be working – but the subsequent oil slick may be far greater than anyone dared fear.

US officials have reportedly confirmed that the well appears to be no longer leaking – but at the same time it’s being reported that the oil slick is now the worst in the nation’s history (see satelite photo, left), and that BP appears to have attempted to downplay the scale of the disaster.

President Barack Obama, at a press conferrence this morning (Thursday, May 27) said his government will hold BP fully accountable for the massive oil leak in the Gulf of Mexico, and barred any new deepwater oil exploration for six months.

A report in today’s Vancouver Sun newspaper, BP stops oil flow; slick worst in U.S. history, states the US government now believes oil may have been gushing into the Gulf at a much greater rate than BP had stated:

New data released by government scientists said the oil may have been flowing at a rate up to four times higher than previously estimated by BP.

The new estimates suggested the oil was gushing out at a rate of between 12,000 to 19,000 barrels a day — much higher than the previous estimate of 5,000 barrels a day.

Under such a scenario, that would mean between 18.6 million gallons and 29.5 million gallons of oil have seeped into the Gulf — way higher than the 11 million gallons of crude spilled in the 1989 Exxon Valdez disaster off Alaska.

With 100 miles (160 kilometers) of Louisiana coastline already contaminated, there are fears U.S. officials may order the burning of the state's unique marshlands, home to a variety of endangered birds and mammals.

Based on the 5,000-barrels-a-day figure, the clean-up cost was estimated at $23 billion – although subsequent press speculation is that “the company could now face effectively unlimited fines” under the US Clean Water Act. According to the UK Daily Telegraph“ the US government could seek to fine BP up to $4,300 for every barrel leaked.”

And it’s hard to imagine the government cutting BP much slack, considering reports emerging that the oil giant had been allegedly cutting corners immediately before the April 20 explosion and sinking of the Deep Horizon rig and resulting spillage from the Macondo well.

According to a report in yesterday’s New York Times, documents supplied by a congressional investigator suggest BP had been using the riskier – and cheaper – of two methods to seal the well shortly before the blast:

The approach taken by the company was described as the “best economic case” in the BP document. However, it also carried risks beyond the potential gas leaks, including the possibility that more work would be needed or that there would be delays, the document said.

The industry has been speculating on how this will play out across the board. While no-one expects a permanent ban on deepwater drilling off the US coast, an item on Wall Street Journal blog The Source, headlined Oil Industry Suffers First Blowback From BP Spill, suggests Royal Dutch Shell has suddenly found itself unable to go ahead with plans to immediately drill an offshore Alaskan well, and that the industry as a whole will face rising costs:

“A clear outcome of the Macondo well blow out will be higher offshore drilling costs in the future,” said Evolution Securities in a research note. “Changes are likely to include tougher permitting systems; tougher inspection regimes for safety equipment; higher specification for key safety components and more redundancy features; more extensive clean up plans.”

Insurance premiums for deepwater drilling have already jumped 40% and may rise further if U.S. lawmakers raise the liability cap for oil spills from $75 million to $10 billion, Evolution said.

Rising costs for the industry, at a time of oil price volatility – oil dropped to $70-per-barel due to the European debt crisis, and currently stands at $73 – spell trouble. All it would take is a pronounced market downturn to make deepwater ventures untenable, and the world’s markets are in deep trouble. Europe is awash in debt, China’s economic miracle, based on a housing bubble, is beginning to look shaky, and the US is printing money to bail its own economy out.

Things may be coming into place for a more upfront discussion about the reality of peak oil. The oil industry has nothing to lose by talking about just why it is forced to look to extract oil from mile deep seabed. It's probably time for oil companies, and governments, to admit that this is where the last oil reserves, outside of Opec, are to be found. And at the same time, for those of us that object to deepwater drilling and oil sands extraction to face up to the fact that - like it or not - our modern world runs of such environmentally destructive energy. That's not to let BP off the hook for apparently cutting corners, but to admit the realities of peak oil.

As the Whiskey and Gunpowder site provocatively puts it:

I guess my concern is all those who will come out of the woodwork and decry what’s happened here…and then drive twenty miles to a supermarket and shop for goods brought in from across the country by a fleet of trucks. They just don’t appreciate how necessary offshore drilling is for their way of life to continue. It’s one thing to say BP or Transocean fouled things up royally, but it’s another to say that they shouldn’t be drilling in deep water at all.

The Peak Oil Crisis: After the spillGulf spill won’t dampen U.S. appetite for oil

The Peak Oil Crisis: After the spill

As we wait for the results of yet another effort to plug the leaking Gulf oil well, it is a good time to review the forces that are impacting on the energy markets and ultimately the cost and availability of our oil.

A new factor on the world scene is a possible revival of some form of hostilities in the Korea peninsula after nearly 60 years of truce. Our old friends, however, are still in play - a burgeoning European debt crisis; a struggling U.S. economy; China and India growing to beat the band; and Beijing still buying up every last smidgeon of oil that anyone in the world will sell. While the struggling economies in the OECD countries tend to push prices down, relentless Chinese and Indian economic growth, threats of war in Korea and the Middle East, and now threats of heavier regulation on offshore drilling will push prices up.

It is the net of all these forces will determine what we pay for our oil the next three or four years after which the great decline in global production is likely to be upon us. This will set off a whole new round of pressures as the developed countries will be forced to bid against the burgeoning economies of the East - provided they are still growing -- for ever declining supplies of oil.

The immediate question however is what the regulation of offshore drilling will look like in the years ahead. Right now there is sort of a balance between outrage over what the spill might do to the Gulf seafood and tourist industries and the need to preserve jobs in these troubled times. U.S. Senators from the offshore drilling states have already written President Obama asking the moratorium on new shallow water drilling be lifted. This is apparently based on the idea that a shallow water blowout could be capped relatively quickly and that the offshore drillers are going to be ultra-cautious for awhile.

Deepwater wells which may be providing the bulk of whatever oil production is left in the next decade are another matter. This week the President is scheduled to announce a new series of regulations for offshore drilling - how these regulations are accepted by the industry and how they are enforced will tell us much about offshore drilling in the years to come.

First, it is obvious that with BP facing fines and clean-up expenses running into the $10s of billions and some senior executives likely facing early retirement, no one in the oil industry wants another Deepwater Horizon. The problem is that deep water drilling is so horribly expensive - about $1 million a day to lease and operate a deepwater rig - that managers in the field will feel constant pressure from Headquarters to get the job done as quickly as possible and move on to the next drilling site.

It would not be surprising if the Presidential Investigating Commission concludes that pressure from above was a factor in the decision to declare the well sealed and pull out the protective drilling mud, despite indications that all was not well.

It is not yet clear whether the drilling industry, or the government for that matter, wants government inspectors aboard every drilling rig participating in critical operational decisions that could result in a blowout. With a million dollars a day at stake, it is unlikely that the industry wants relatively low level inspectors deciding that the cement needs another day or so to dry properly. The upside of course is that should the unthinkable happen, the industry is in a good position to pass the liability on to the government if it signed off on the procedure.

There are obviously billions of dollars and the fate of nations involved in this question, for if offshore drilling takes substantially longer and becomes substantially more expensive, then so does our oil.

With a deepwater well costing about $1 million a day and taking three months to complete, we can easily see where the $100 million oil well comes from. As an increasing share of our oil comes from $100 million or perhaps even more expensive oil wells (just think what the insurance on these things is going to be), $3, $4, or $5 gasoline will soon be but a distant memory.

Gulf spill won’t dampen U.S. appetite for oilOil spills — there’s no free lunch

Three Chinese curses

May you live in interesting times.

Mission accomplished. I'm there, as we all are. As we always have been, during two million years of the human experience.

May you attract the attention of the government.

I'm there, as I have been for years. To remove all doubt, about five years ago I placed a call to then-Governor Napolitano's lead advisers on two topics, Energy and Agriculture & Natural Resources. I begged and pleaded with them, but they kept coming back with their singular response: "There is nothing we can do about global peak oil."

It took a couple years for me to figure out what they meant because, of course, there are many things the government can and should do to mitigate for declining energy supplies. Government officials could start by letting citizens in on the truth about energy.

So, what did members of the governor's staff really mean? There are no politically viable solutions. In this case, telling the truth is political suicide. The impending death of millions of people -- and perhaps billions -- pales in comparison to political careerism.

May you find what you're looking for.

I'm talking to a naturalist I barely know. His one-year-old son is resting on his shoulders and treating a cattail as his personal magic wand. The seeds of the cattail are falling into the hair and beard of the 40-year-old naturalist as the boy succumbs to his own personal energy crisis and, fighting all the way down, succumbs to slumber.

I'm writing a book about the dire nature of our predicaments and I mention the high likelihood of a global economic collapse within a decade or so. The naturalist doesn’t bat an eye before responding: "I hope I'm around to see it. I don’t want my son to have all the fun."

Fast forward six years, and I'm sharing a property with the naturalist and his young son. Collapse of the industrial economy is well underway, and has entered the acceleration phase of its death spiral. Obviously, we will live to see the final stages of the ongoing collapse of the industrial economy. As a result, we might see the living planet takes the first tentative stages to a comeback.

Or perhaps not. Maybe in the coming few years we will die, collateral damage of the demise of the industrial economy. Just like entire ecosystems in the Gulf of Mexico and the millions of species organisms within them, consumed by the fire as Rome goes up in flames.

Maybe lifting the curse of industry will reveal a worse fate, at least at the level of individuals. But it's difficult to imagine a situation in which termination of the industrial age will not improve the lots of every non-industrial culture and every non-human species on this planet.

May we find what we’re looking for, regardless of the personal cost.

Oil-Choked SpringEconomy picks up with service sector growth, more home contracts

Sustainable Medicine: An Issue Brief on Medical School Reform

Orientation

This issue brief calls for changes in medical school culture, primarily curriculum, research and clinical practice, as a conscious response to the simultaneously ongoing fiscal/economic crisis and what E.O. Wilson has termed the Bottleneck[i] of ecological dilemmas, shown most prominently but not exclusively as the worldwide peak in crude oil production. Together these forces will reconfigure modern society, particularly health care. We concur with Dennis Meadows, co-author of Limits to Growth,[ii] who claims that this is not a recession; rather “The real problem is physical growth in material and energy flows pressing against the limits of a finite planet.”[iii] Therefore, this is a sustainability crisis calling for ecologically informed, non-incremental public policies to transform social institutions.

Here we focus on awakening medical schools to their future in a world beset by fiscal disorder, economic contraction, unprecedented natural resource scarcity, and ecosystems disturbances[iv].

Issue Definition

Modern medicine owes its string of innovations, its health promoting and prolonging successes, and its institutional viability to an economic system based on inexpensive and abundant supplies of crude oil. Oil is a feedstock for a multitude of pharmaceuticals, health commodities and medical products, and is the major source of transportation fuel for staff, patients, emergency vehicles, and equipment and supply deliveries. Oil is also the cornerstone of the modern economy and financial system, a point elaborated below. Thus medicine depends on petroleum both directly, in how it delivers care, and indirectly, because of the modern financial and economic system it enables.

The petroleum era is entering its dénouement concurrently with the largest fiscal and economic crisis since the Great Depression. These two crises are related in that cheap, abundant energy is needed to facilitate capital accumulation and socioeconomic expansion. In terms of finance, “real” wealth creation derives from increasing energy flows, which in turn allow for an economy based upon borrowing and debt repayment while leaving a profit for the borrower. While some may call this connection between finance, economy and energy (primarily oil) speculative or paradigmatically[v] illogical, there is no doubt that work requires energy. Plainly, economic expansion cannot occur without more net energy available to the socioeconomic system –and energy is needed to operate, repair and maintain extant infrastructure[vi].

Significantly, crude oil production has been on a plateau since 2005, known reserves are in decline, and there is no alternative energy infrastructure yet available. The would-be successors to oil: wind, solar, shale gas, biofuels, nuclear, tar sands, and hydrogen, all face one or more of the hurdles of scalability, environmental sustainability, or net sufficient energy return. As well, developing and using these alternatives depends on unknown amounts of fossil fuels, particularly petroleum[vii] and other resources such as land, rare metals, or uranium. Nevertheless, developing alternative energy sources, especially renewable energy sources, such as wind, solar thermal, and photovoltaic, should be pursued with vigor. Even so, these alternatives cannot substitute for oil, let alone replace the decline in production of the oil needed for an industrial economy. They will be essential in helping to develop a sustainable society, but are not a panacea to keep the growth economy going.

Therefore, the lack of an ongoing transition to a new energy platform – estimated to require from 10 to 20 years[viii] — is resulting in a series of downward economic cycles: the cost of energy will rise – due to supply constraints – if real economic growth restarts and then will fall as rising energy costs again destroy demand, creating more economic contraction.

Reaching peak oil also portends the decline of the financial sector -which in the USA has tripled in size since 1980- because it is a credit (debt) based system rendered unworkable by peak oil. We note that as worldwide oil production approached a plateau several years ago the financial sector generated huge debts that without exaggeration cannibalized the “real economy,” culminating in “synthetic instruments” unconnected to any tangible commodity, asset or good[ix]. These fictive debts – and equally chimerical wealth – have not been resolved through disciplined procedures –bankruptcy, write-offs, jubilee, shareholder losses, governmental or regulatory agency seizure of assets, criminal prosecutions – but instead have been transferred to sovereign states. This postpones a cultural, economic, and political realization that money is a symbolic claim on energy and other resources. Bluntly, you cannot eat currency or burn it in your gas tank, and printing more of it exacerbates the dilemma. Eventually the discrepancy between “paper wealth and debt” and the earth’s resources must be acknowledged if we are to realize that this is a sustainability crisis.

When this occurs it will become apparent that viable solutions originate from understanding how the earth’s resources and ecosystems set the bounds of finance[x]

and the economy[xi]. In other words, if energy scarcity is acting as a governor on economic expansion, then the so-called Keynesian solution of printing money to “stimulate the economy” no longer works.

Issue History and Context

In 1957 Admiral Hyman Rickover informed a medical convention in Minneapolis that if a conversion away from fossil fuels were not completed within fifty years socioeconomic and financial turmoil would result[xii]. Similarly, Shell Oil geologist M. King Hubbert[xiii] told a conference of his peers in 1956 that oil production in the lower 48 states, then rising, would peak between 1965 and 1970. He was ignored and ridiculed, but in 1970 “peak oil” occurred as predicted. Hubbert’s intellectual descendant Princeton geologist Ken Deffeyes[xiv] claims that world production peaked in 2005, and he has also forecast that the peak would lead to disarray in financial markets and widespread unemployment. Geologist Colin Campbell has made the same observation about the economic and financial consequences of peak oil[xv]. (Thus geologists foresaw what almost all mainstream economists did not.)

However, the demand destruction for oil during the fiscal/economic crisis that began in 2007 has co-varied with this production peak, suggesting it is still not certain that the worldwide peak has been reached. Nonetheless, we are certain that peak oil, finance and the economy are connected in a little explored complex of feedback loops[xvi], which are further complicated by cultural constants – corruption, herd behavior, inertia for institutional stability[xvii], and greed – and also geopolitical relations among nation states vying for oil and other resources.

Therefore, we propose that: 1) the energy crisis –if not the actual geological peak in oil production[xviii]- is here, and not years in the distance; 2) it is affecting the economy, the financial system, and our place in the world; and 3) we are slow to acknowledge its reality and to plan a response.

The thought of civilization’s material existence declining as opposed to becoming “bigger and better” is anathema to university presidents and medical faculty deans, to say nothing of philanthropic sponsors, politicians, corporations, and the mainstream media. Inversely, once the end of growth is accepted, building a sustainable society will be the obvious response -but we acknowledge that belief in perpetual growth is deep-seated, even mythical[xix]. As one observer puts it, “Eaarth itself will be th[e] ecological Lenin, a harsh environmental dictator that will force us to bend to new rules. The question is whether we will be smart enough to bend ourselves first.”[xx]

Still unbending, the world economy nevertheless is stochastically contracting, and this translates into two classes of effects on the health sciences:

1. The social determinants of health are placed at risk of precipitous decline, and this carries immense epidemiological implications; and,

2. Less appreciated, health systems eventually will be unable to maintain current levels of operations, specifically their social and technological complexity and levels of resource consumption will have to be reorganized or face collapse.

Issue Analysis:

Toward Sustainable Medical Schools

Rather than give detailed consideration to medical research and clinical practice, we focus here on medical school curriculum as our primary example. Accepting that we face a sustainability challenge as opposed to a recession, medical education has the paradoxical tasks of: 1) training current students to practice medicine in today’s socially and technologically complex and high resource consumptive world while simultaneously 2) building a bridge to a world all but guaranteed to shrink these levels of complexity and consumption. This is especially vexing because we do not know how much loss of complexity and lowering of consumption are required –that is, the definition of sustainable medicine is in flux and depends upon an interplay of ecological, economic and fiscal forces.

Presently, there are no medical schools we are aware of dealing with this conundrum[xxi]. But the school(s) that ultimately creates a paradigm of sustainable medicine will be advantaged in terms of organizational survival, clinical practice, research–both agenda setting and funding streams – and plaudits for vision and leadership. Moreover, there is an opportunity – and a strategic imperative – for medicine to lead in advocating for a sustainable society as a matter of public health and social responsibility, and as a model for other institutions in society.

Following innovation theory,[xxii] approximately 2% of a given universe -in this case, schools of medicine- can be expected to take on this unprecedented challenge. Since the sustainability crisis ostensibly is high in present costs with few or no immediate benefits, even this 2% may be too high an estimate. Moreover, risk aversion or miscalculation of risk among leaders[xxiii] accounts for significant resistance to innovation, especially an innovation that results in less complexity and resource consumption[xxiv]; this is a paradigm shift that is truly of Kuhnian magnitude. Ironically, any medical school deans who would pursue sustainability as outlined here would likely encounter strong opposition from their faculties, the medical establishment, and administrative superiors, although there is hope as more and more universities are promoting sustainability as part of their corporate image and also their educational curricula –and medical students will be enthusiastic about sustainability. While it is possible, even likely, that the change in medical culture may not come from schools of medicine, but from practitioners in the field, we feel that, given the serious and imminent nature of the problem, such a passive approach is unacceptable and medical schools must acknowledge the problem and begin to act.

In terms of risk assessment we take a “strong position” that the arrival of peak oil means there is a probability of 1 that medicine schools must become sustainable or face chaotic change. The standard risk assessment formula is R = ƒ(H · V), where R is hazard risk, H is hazard probability, and V is hazard vulnerability. The immediate hazard, H, in our case is “peak oil.” While its timing is in doubt, the evidence cited above suggests it has occurred or will occur within five years. The actual timing is irrelevant because the era of cheap energy facilitating economic growth is irretrievably over.

Energy is not the only ecological risk we face; it is merely the most pressing and unavoidable one because of its interaction with all aspects of our society; it is perhaps the most important component of our infrastructure. Down the road are intensifying consequences of climate change, ecosystems insults and degradations, water scarcity, soil erosion, dying and overfished oceans, and even peak phosphorous,[xxv] to name a few.

The purpose of strategic management – for which risk assessment is a tool – is to ensure the survival of the organization by aligning it with the external environment, particularly during periods of high uncertainty, turbulence or chaos. We conclude by assessing medical school reform in this context.

Policy Discussion

As a reference point, Hanson and Callaghan[xxvi] list four core goals of medicine:

The prevention of disease and injury and the promotion and maintenance of health;The relief of pain and suffering;The care and cure of those with a malady, and the care of those who cannot be cured; andThe avoidance of premature death and the pursuit of a peaceful death.

Important to our discussion, they note that medicine has become reductionist in its approach to illness while diminishing the importance of the natural and social environmental contexts of health promotion and illness prevention. This “invasive microbes” model translates into the basic science classes of the first two years of medical school followed in the third and fourth years by clinical experience, field of specialization classes, and electives. With few exceptions, this is the standard curriculum, and it emphasizes resource-intensive treatment over less resource-consumptive preventive health care. Significantly, it also dominates the medical research agenda.

We propose a fifth goal be integrated into medicine: the practice of supply-side sustainability,[xxvii] which recommends management from the perspective of the whole ecosystem, not the resource[xxviii]. In other words, we must consider how human health fits in the context of overall ecosystem health, or, more bluntly, when we must forgo human health so as to ensure a viable biosphere within which humanity can sustain itself indefinitely. The ramifications of this goal will jar many in academic medicine who are engrossed in their specialties and regard the larger systems that support their work as a perpetual motion machine that cannot falter.

Consider that Hanson and Callaghan’s four goals reflect a modern interpretation of the Hippocratic Oath, which values the patient ahead of, or to the exclusion of, all other concerns, especially resource consumption and environmental impacts. But, in view of the ultimate dependence of all life on a healthy ecosphere, and also because many of the resources we use – oil, water, minerals – are depleting, such concerns must be considered. One definition of sustainability is: “… the process of living within the limits of available physical, natural and social resources in ways that allow the living systems in which humans are embedded to thrive in perpetuity”[xxix]. Many would argue that following a lifestyle based on this definition is unrealistic, but, in the long run, we have little choice; today’s lifestyles are clearly unsustainable, and ultimately disastrous. Certainly today’s health care system does not fit with this definition; yet, ultimately it too must conform, and the transition from the current model to a sustainable health model will be difficult.

In a sustainable health system the supremacy of the patient must be synthesized with an “Ethics of Environmentally Responsible Health Care”[xxx]. We cannot digress into this discussion here except to note that it calls for discourse in medical ethics and bioethics that overcomes the dualisms implicit in the received interpretation of the Hippocratic Oath; i.e. the sanctity of the patient versus (a) social factors and (b) ecological constraints, priorities, and impacts. This raises major ethical, social, political, and cultural issues that will result in a fervid discussion that goes to the heart of the current paradigm of academic medicine[xxxi]. For example, today’s medical ethics is set in a framework of an expanding macro-economy providing a bounty of resources to support problem solving that increase social and technological complexity and energy consumption.[xxxii] But supply-side sustainability requires “innovation” and problem solving in a macro-economic context of less complexity and resource scarcity.

To this end, we note several recent reports on medical curricula.[xxxiii] Without exception these reforms presuppose a patient-focused model of care and linear expansion of medicine’s social and technological complexity, resource consumption, and, it logically follows, its physical size. We respectfully find these reports out of sync with the strategic mandate to build sustainable health systems. However, taking a baby and the bath water approach, our views are consistent with and complement many of the proposed reforms in these reports, which we do not have the space to discuss here.

A comprehensive goal of medical school reform should be to introduce students to the idea of health systems functioning in accord with supply-side sustainability, which, according to Allen et al, is:

more fundamental than mere exhortations to do such and such things as use public transport and take colder showers. Sustainability entails management of systems and their contexts…[xxxiv]

We propose to redefine the medical context as a part of nature, with human species’ survival depending on the continued availability of essential renewable resources, which in turn depend on healthy natural ecosystems.

The context of supply-side sustainability is related to the ecological theory of panarchy, “the hierarchy of adaptive [ecological] cycles … across time/space scales.”[xxxv] We see panarchy[xxxvi] as a scientifically grounded and concise way to illustrate that modern economies are at the apex of the exploitation of natural resources cycle – oil and other resources now becoming scarce, environmental degradation mounting – that has allowed for the phenomenal successes and growth of modern medicine and public health. This gives way to its successor ecological phase (an emerging context), resource exhaustion, pollution, ecosystem breakdowns, which leaves our species with the options of (a) acknowledging our predicament and beginning immediately to adapt to a simpler, more sustainable, lifestyle, (b) maintaining Business As Usual. Unfortunately, the second option will most likely win out in the short-term. For medical education (and health care), the same issues, options, and urgencies apply.

In summary, medical school graduates will need to value resource conservation and ecological processes equally to the rights of the individual patient. It is imperative that their education prepares them for their role as a historically transitional generation called upon to relinquish levels of social and technological complexity and, in addition to the scientific knowledge that forms the basis of medicine, to also draw upon tactile and tacit knowledge gained during their careers. An example helps make this point.

A recently retired doctor informs me, “In orthopedics we used to set fractures mostly by feel and knowing the mechanics of how the fractures were created. I doubt that many of the present orthopedists could do a good job if you took away their [energy powered] fluoroscope or X-ray.”[xxxvii]

Policy Recommendations

Based on the arguments presented, we feel that the concepts of supply-side sustainability should be incorporated into the three primary dimensions of medical school culture: curriculum, clinical care, and research; and to also communicate this reorientation to the larger society, through “Social[xxxviii] Marketing”[xxxix] and “Branding”.

A simple outline is presented below; it is less of a map than it is a stone in our shoe moving us to action.

1. Curriculum.

i. Supply-side sustainability built into all courses.

ii. Develop a capstone course on “sustainable health care in the 21st century”.

iii. Elevate preventive medicine to equal status with treatment medicine.

2. Clinical.

*Develop scenarios of resource conservation for medical practice.

i. 15% reduction of use

ii. 25% reduction of use

iii. 50% reduction of use

3. Research.

i. Develop a research agenda anchored in the protection of the social determinants of health.

ii. This research agenda’s rationale is based on the epidemiological shifts brought on by economic contraction.

4. Use “Branding” and Social Marketing to promote the medical school as meeting the 21st century necessity to create sustainable health systems.

Endnotes

[i] Wilson, E.O. “The Bottleneck.” Scientific American, February 2002.

[ii] Meadows, Donella. Dennis Meadows, Jorgen Randers, William Behrens III. The Limits to Growth. New York: Universe Books. 1972.

[iii] Meadows, Dennis. “Economics and Limits to Growth: What’s Sustainable?” Conference on Population Growth and Rising Consumption: What’s Sustainable?” The Population Institute. October 6, 2009. http://populationinstitute.org/newsroom/events/view/5/

[iv] Cohen, Dave. “The Sixth Extinction.” ASPO. July 30, 2009. http://www.aspousa.org/index.php/2009/07/the-sixth-extinction/.

[v] Kuhn, Thomas. The Structure of Scientific Revolutions. Chicago: University of Chicago Press. 1962.

[vi] Hall, Charles Hall, R. Powers and W. Schoenberg. (in press). “Peak oil, EROI, Investments and the Economy in an Uncertain Future.” Pp. xxx in Pimentel, David, ed. Renewable Energy Systems: Environmental and Energetic Issues.

[vii] See the writings of Gail Tverberg: http://www.theoildrum.com/search/google?cx=000874532052579887663%3Amezzmhxsexy&cof=FORID%3A11&query=tverberg&op=Search&form_build_id=form-b8dda647e69bbc6929a3ece6d0750c62&form_id=google_cse_results_searchbox_form.

[viii] Hirsch, Robert L. Roger Bedzek and Robert Wending. “The Hirsch Report” AKA “Peaking of World Oil Production: Impacts, Mitigation, & Risk Management.” Washington: US DOE, February 2005.

[ix] Sender , Henry, Francesco Guerrera, Stephanie Kirchgaessner. “Goldman вЂcriticised $1bn loan product’.” Financial Times, April 27, 2010. http://www.ft.com/cms/s/0/f144793c-518c-11df-bed9-00144feab49a.html.

[x] Soddy, Frederick. The Role of Money: What It Should Be, Contrasted with What It Has Become. New York: Harcourt, Brace and Co, 1935.

[xi] Mayumi, Kozo, and John M. Gowdy. Bioeconomics and Sustainability: Essays in Honor of Nicholas Gerogescu-Roegen. Cheltenham, UK: M.A. Elgar. 1999.

[xii] Rickover, Hyman. “Energy resources and our future.” Delivered at a Banquet of the Annual Scientific Assembly of the Minnesota State Medical Association, St. Paul, Minnesota. May 14, 1957. http://www.energybulletin.net/node/23151.

[xiii] Hubbert, M. King. “Nuclear energy and the fossil fuels.” Presented at the Spring Meeting of the Southern District Division of Production American Petroleum Institute Plaza Hotel, San Antonio, Texas March 7-8-9, 1956.

[xiv] Deffeyes, Kenneth S. Beyond Oil: The View from Hubbert’s Peak. New York:Farrar, Straus and Giroux, 2005.

[xv] Campbell, Colin. “Peak Oil: A turning for mankind.” Great Change.org. ND. http://www.greatchange.org/ov-campbell,peakoil_turning_for_mankind.html.

[xvi] Tverberg, Gail. “Why are oil prices so low?” The Oil Drum, October 22, 2008. http://www.theoildrum.com/node/4672.

[xvii] Douglas, Mary. How Institutions Think. Syracuse: Syracuse University Press. 1982.

[xviii] Staniford, Stuart. “If 2005-2007 wasn’t peak oil, what was it?” Early Warning: Risks to Global Civilizagtion. April 212, 20120. http://earlywarn.blogspot.com/2010/04/if-2005-2007-wasnt-peak-oil-what-was-it.html.

[xix] Catton, William Jr. Overshoot. Urbana: University of Illinois Press. 1982.

[xx] Greenberg, Paul. “Hot Planet, Cold Facts.” Review of Bill McKibbon’s Eaarth:Making a Life on a Tough New Planet.New York Times, April 29, 2010. http://www.nytimes.com/2010/05/09/books/review/Greenberg-t.html.

[xxi] Homer-Dixon, Thomas. “Our Panarchic future.” Worldwatch Institute. February 2008. http://www.worldwatch.org/node/6008.

[xxii] Rogers, Everett M. “Diffusion of Innovations. 1962.

[xxiii] Kahneman, Daniel, and Amos Tversky (1979) “Prospect Theory: An Analysis of Decision under Risk”, Econometrica, XLVII (1979), 263-291.

[xxiv] Staff. “Innovation hampered by ‘risk averse’ public authorities.” Eur-activ.com. March 24, 2010. http://www.euractiv.com/en/enterprise-jobs/innovation-hampered-risk-averse-public-authorities-news-373313.

[xxv] Déry, Patrick and Bart Anderson. “Peak Phosphorous.” Energy Bulletin. August 13, 2007. http://www.energybulletin.net/node/33164.

[xxvi] Hanson, Mark J. and Daniel Callahan, eds. The Goals of Medicine: The Forgotten Issues in Health Care Reform. Washington, D.C.: Georgetown University Press, 1999.

[xxvii] Allen T.F.H., Joseph A. Tainter, and Thomas W. Hoekstra. Supply-Side Sustainability. New York: Columbia University Press. 2003.

[xxviii] Allen, T.F.H., Joseph A. Tainter, and T.W. Hoekstra. Supply-side Sustainability. Systems Research and Behavioral Science, 1999, 16:403-427.

[xxix] University of Alberta Office of Sustainability. Working Definition. Spring 2010. www.sustainability.ualberta.ca/.

[xxx] Pierce, Jessica, and Andrew Jameton. The Ethics of Environmentally Responsible Health Care. New York: Oxford University Press. 2004.

[xxxi] Staff. “The culture of medicine.” Science Daily, January 5, 2009. http://www.sciencedaily.com/releases/2008/12/081231182014.htm.

[xxxii] Tainter, Joseph A. “Social Complexity and Sustainability.” Ecological Complexity 3 Pgs. 91-103, 2006: 93.

[xxxiii] Greiner, Ann C. and Elisa Knebel, Eds, Health Professions Education: A Bridge to Quality. Institute of Medicine, 2003.

Task Force on Academic Health Centers. Training Tomorrow’s Doctors: The Medical Education Mission of Academic Health Centers. Commonwealth Fund. 2002.

Ad Hoc Committee of Deans. Educating Doctors to Provide High Quality Care: A Vision for Medical Education in the United States. American Association of Medical Colleges. 2004.

[xxxiv] Allen T.F.H., Joseph A. Tainter, and Thomas W. Hoekstra. Supply-Side Sustainability. New York: Columbia University Press. 2003: Pg. 14.

[xxxv] Biocultural Diversity Learning Network. “Panarchy.” Global Diversity Fund. 2010. http://www.globaldiversityfund.net/glossary/1/letterp.

[xxxvi] Gunderson, Lance, and C.S. Holling, eds. Panarchy: Understanding Transformations in Human and Natural Systems. Washington, D.C.: Island Press. 2002.

[xxxvii] Bednarz, Dan. “Medicine after Oil.” Orion Magazine, July/August 2007. http://www.orionmagazine.org/index.php/articles/article/314/.

[xxxviii] Zaltman, Gerald, and Lindsay Zaltman. Marketing Metaphoria: What Deep Metaphors Reveal about the Minds of Consumers.Boston: Harvard Business Press. 2007.

[xxxix] Kottler, Philip, and Gerald Zaltman. “Social Marketing: An Approach to Planned Social Change.” Journal of Marketing, July 1971, Vol. 35: pg. 3-12.

Health reform means big changes for businessesForever and a day

The Work Ahead

May hits us like an ice water dousing on a drowsy morning. It is simultaneously shocking and deeply refreshing. Winter’s leisurely breakfasts are suddenly a thing of the past: Bob and I scarcely have time to join each other for a cup of coffee before we find ourselves on our hands and knees weeding asparagus, donning nets to check on the beehives, pounding posts to trellis new grape vines, digging holes for new fruit trees, or heading down to the farm to make sausage before the farmer's market starts. I help my dad vaccinate the sheep and bag fleeces for the mill; he examines the flock for parasites, moves the broilers out to pasture, checks the fences, hauls hay bales to the cattle to tide them over until the pastures are amply lush, and monitors the grasses and our very pregnant ewes. My mom faces an endless barrage of dishes to wash following our luncheon feasts (made larger to accommodate our springtime appetites), handles the incoming meat orders, and helps us care for the girls. But despite all our activity, we still feel as though we are in the calm before the storm that will hit when lambing season officially begins. All other away-from-home plans are subject to the whims of nature as our family readies to welcome the spring crop of newborns.

Thankfully, the commencement of lambing season also rings in the official start of our summer internships, with one or two students interested in a future in small farming joining us to share the labor and learn how the farm operates. Our relationships with these students often grow very close; over the years they’ve become a colorful web of extended family, delighting us with their ongoing adventures. This year, we have been particularly excited to welcome back a returning, much-adored second-year intern, as well as a new student from one of the state agricultural colleges. Our newest recruit comes from a small family farm that she has chosen to revive, and she is faced with the challenge of proving to her father that it can provide a livelihood before he’ll turn over the reins. Her internship with us is the final requirement for completing a four-year degree in agricultural business, and a springboard for initiating her own family farm renaissance.

Thus, we were surprised when, a few weeks ago, she visited my parents with an awkward message from her college adviser. Blushing and avoiding eye contact, she reported, “My adviser says I’m supposed to explain to you that I’m a good student.” When asked to explain the meaning behind her message, she reported (to paraphrase), “He says I’m supposed to be learning how to run a farm, not to do grunt work.”

That was a hard message for us to take. My mother pointed out that absolutely everyone on the farm does physical work. “No one carries a clipboard in this business,” she said. It is the physical work that puts us in tune with the rhythms of nature and sharpens our powers of observation to detect problems. When we have handled 100 robust chickens, our hands can swiftly detect that number 101 is in poor health. When we’ve battled thistles in the pastures, we become sensitive to the dangers of over-grazing. When we feel the meat in our own hands and observe the marbling and fat cover, we connect the quality of the food with the quality of the farming. When we prepare our food and wash our dishes, we become attuned to our own physical needs for rest and nourishment.

It is surprising that the person to raise an objection to this way of life would be a professor of agricultural business. Surely he, of all people, would comprehend that the success of a family farm is drawn from everyone’s involvement in the labor. This is how family farms have managed to survive: We are all both labor and management.

In fact, though, that's not the model for modern, industrial agriculture. In our conventional food system, labor is reserved for people from the most humble backgrounds—those who are paid the least, receive the least amount of education, and who are presumed to be the least intelligent. Management is for the privileged, the educated. Interestingly, our modern homes are run the same way. Many able-bodied, educated Americans leave the home for the workforce, relegating the labor required for the production of their basic necessities—food, childcare, and sometimes even their household upkeep—to those who don’t share their social standing. Physical work, in the case of industrial farming as well as what you might call "industrial housekeeping," is often viewed as lowly, dirty, or unacceptable. From this view, it is understandable how a professor of agricultural business, skeptical of the small farm and local food movements, would despair at seeing a promising student take an interest in family farming and spurn the chance to have smooth, clean, un-calloused hands.

Happily, though, more and more people are seeing his ideas regarding the separation of work and management as embarrassingly outdated. As we discover the important role of local food in healing our ecosystems, nourishing our health, and building life-serving economies, small farmers are once again becoming valued members of our evolving Earth community. Likewise, we’re building esteem for others whose physical work helps heal our families, communities, and planet: the homemaker who makes prudent use of local bounty or tends his or her own garden or livestock; the commuter who pedals a bicycle; the entrepreneur who repairs material goods so that they needn’t be discarded.

But while no longer disdained, physical work still meets resistance. In recent interviews about my book Radical Homemakers and my life on a family farm, the response from several reporters has been: “Wow. You must work so hard. I could never do that.” I’ve heard from other radical homemakers and farmers who’ve heard similar remarks from the people they meet. In reality, we’re just ordinary people engaging in some healthy labor. By elevating physical labor to the level of superhuman achievement, these apparent admirers are making the same mistake as the professor who thinks it’s only worthy of “grunts.” They’re avoiding work.

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Avoiding physical work, ironically, has taken its toll in America. We face an obesity epidemic—in part because we are physically inactive and in part because we no longer engage in the labor required to prepare foods from authentic ingredients. Our food is transported thousands of miles at a huge environmental cost because too many of us have been discouraged from the labor required to grow it. Toxic chemicals are dumped into our Earth’s soil and water as a result of the industrial, labor-saving technologies now used to produce it. (Meanwhile, many of us buy exercise machines to counteract the effects of our poor diets and stationary lifestyles, using still more of the Earth’s resources.) If we want life-serving, locally based economies, social justice, ecological sustainability, and shortened production chains, then more of us must get our hands dirty.

I believe that we are faced with the exciting challenge of stewarding our human race through a great evolution whereby we will become a beneficent species on the planet rather than a destructive one. I do not believe this transformation can happen if our bodies, minds, and spirits are divorced from one another. They must perform in a balanced union that enables us to live in ways that are both more joyous and more healthy. Physical work—be it farm labor, cooking, mending, repairing, gardening, or creating—is required by all of us, as we are able. It is neither beneath us nor above us. 

Shannon Hayes wrote this article for YES! Magazine, a national, nonprofit media organization that fuses powerful ideas with practical actions. Shannon is the author of Radical Homemakers: Reclaiming Domesticity from a Consumer Culture, The Grassfed Gourmet and The Farmer and the Grill. She is the host of grassfedcooking.com and radicalhomemakers.com. Hayes works with her family on Sap Bush Hollow Farm in Upstate New York.

TN floods wipe out farmers’ cropsTelling porkies: The big fat lie about doubling food production

An Interview with Peter North

Pete North’s new book ‘Local Money: how to make it happen in your community’ will be formally launched at the 2010 Transition Network conference and will be available to order here at the end of this week. The latest book in the Transition Books series, ‘Local Money’ is a comprehensive overview of local currencies, and how to plan and implement such a scheme. It is written with Transition initiatives in mind, drawing from the experience of Transition currencies such as the Brixton Pound and the Lewes Pound, but it also tells the fascinating stories of other alternative currencies, including the story of how local money was a key element of how communities survived the Argentinian crash. To celebrate the launch of the book, I interviewed Pete about the book, and about local currencies….

‘Local Money’ is about to be published… can you tell us, in a nutshell, what the book covers?

In a nutshell, the fruits of looking at local currencies over the past nearly 20 years distilled into 240 pages. I’ve tried to cover both the longer standing alternative currencies like LETS and Time Money and the newer kids on the block, transition currencies, in as much detail. I’ve also tried to give the reader an understanding of why money is in the form it is now, what is good about different forms of money, and how it could be improved. And I’ve tried to show how people have experimented with alternative forms of money in the past, and what we can learn from them. As a result, its perhaps a bit too meaty than meets some tastes, some but I hope it’s still informative and accessible. I’ve tried to make it clear as well as detailed, as creating your own money does need a little thought to get it right in the long run.

What new insights do you think it brings to the Transition movement at this point in its evolution?

I think that thinking about new forms of money helps us to envisage deeper forms of local reliance where we are producing more of the things we need on a day-to-day basis – especially food, power, everyday goods and services. I can see a way to a vibrant local economy where we are in the driving seat, not distant corporations or banks. I can see the development not only of local forms of money, but perhaps local banks and credit unions, and other forms of local wealth. These are all key parts of transition, but perhaps more for later stages of the transition to a low carbon economy.

That’s not to say that this is just for the more advanced transition initiatives. A small scale LETS or time bank is very easy to set up, and can be a good way of manifesting local skills and resources. It can be an easy quick win.

My sense was that you started researching the book somewhat sceptical about Transition currencies, and over the duration became more enamoured with them… would that be fair?

That’s a cheeky question! I would never say I was sceptical, but over the years I have become very clear about two problems with alternative currencies that I hoped were not being replicated by the new transition currencies. First, they are, to coin a phrase вЂnever knowingly undersold.’ Over the years, I’ve heard the most outrageous and overblown claims about what alternative currencies can achieve, most of which were totally unrealistic.

I’d hear about a wonderful story of a marvellous local currency somewhere, only to find a bloke who has been thinking about it but hasn’t actually done anything yet. I’ve learned that some people can struggle with facing up to problems, and happier with comfy stories and cosy networks. I’m an old fashioned English empiricist. I want to see concrete action on the ground before I get too excited. So I’ve always consciously avoided saying anything that contributes to these myths.

The second issue I’ve become very aware of is that it can be very easy to set up a local currency scheme, but harder to keep it going when the initial enthusiasm wears off. The fact is that at the moment we live in a very globalised world where next to nothing that we use everyday is produced locally. Its something that we need to change, but that won’t happen overnight. Making too many claims too quickly about what you can do with a local currency can be a problem if you find that local businesses actually don’t sell anything produced locally, so they can’t spend on the local currency they take in. And endlessly recirculating things made in China between ourselves does not make us very resilient.

What is important is to keep your eye on the long term prize: a locally resilient, locally owned economy. As my understanding of all the different currency models deepened as I wrote the book, I probably became clearer about that and less focussed on вЂwhat works’ now. What вЂcould’ work in the future?

What do you see as being the key ingredients of a successful local currency scheme?

A well organised group running it, in for the long run, and with good communication skills. They need to be able to explain how it could work to a wide range of people from business to local people to councils, and produce publicity material, websites, directories and notes that look serious. They need to be able to inspire people, but not make overblown claims. They need to be seen as serious and trustworthy, perhaps even small вЂc’ conservative.

They need to do the administration well – we are dealing with real money and people’s businesses and livelihoods here. It’s really important that from the go this is seen as a serious initiative, that every penny is accounted for, and that it is clear how decisions about how your local money will work will be made. Keep perfect records of what you are doing, and be efficient and transparent.

A key ingredient to a successful scheme is less tangible: it needs to have the qualities of вЂmoneyness’ and вЂvaluableness’. If its a paper note, does it look like monopoly money orlike real money, like a pound, a Euro or dollar? Can you actually spend it on really stuff and services? Only when people experience being able to spend local money, and value it, does it become serious. In the book I spend some time showing you how to do this, be it ways of organising your money scheme to what you put on your notes.

One of the most fascinating parts of the book is your own reflections on your time in Argentina around the time of the economic crash there, and how local currencies became one of the key ways by which communities continued to function. What lessons did you draw from your time there?

I was in Argentina just after the financial crash of December 2001, and saw what might have happened to us if Gordon Brown hadn’t carried out his вЂquantitative easing’ in 2007. I saw what happens when you go to the bank and it won’t let you have your money as its being used to bail out the banks. The first thing was that I saw people rallying round and supporting each other by setting up literally millions of local currency schemes through which they shared what they had to get through the crisis.

I could see that the democratically run and community scale schemes worked better than the bigger, centrally-organised networks which were not that resilient. I saw unscrupulous people taking advantage of their fellows in the big, impersonal networks. Eventually I saw confidence in the big networks shattered by accusations that they were a scam. I saw how to avoid this.

If things get hairy either quite quickly as spending cuts hit vital services and perhaps cause a double dip recession, or more long term as peak oil and resource crises really start to bite, Argentina’s experiences show how we can rally round and support each other through local action in ways that do not lay us open to attack.

How might a community get a sense of when it is ready to start a local currency? What does it need to have in place before it considers such a thing?

You can set up a small skills share network immediately: share the skills you have and the things you need either without money, or using a LETS scheme to keep score. If your transition initiative has many less wealthy members or districts in it, or you can find a community group to work with then think about time money. Both these schemes are tried and tested and work in certain circumstances, although you won’t get local businesses involved. If your transition group has lots of more radically minded people who want to share their skills with each other, why not try вЂhours’ – a paper currency denominated in time? All these can be done quite quickly, as long as your group has the energy to do it.

You might disagree with me here Rob as you all set up the Totnes Pound quite quickly, but I would hold a local paper currency back until you are perhaps a more accepted part of the local scene, have a track record and are trusted, and taken seriously by local small businesses. Take the time to talk to and listen to your local businesses, and respect them. And take time to develop a paper currency that really does look like money, not like monopoly money or a voucher. Make sure you are able to deal with teathing troubles, help businesses to spend a local currency, and avoid getting a reputation that it’s a good idea but it doesn’t actually work. Be in it for the long run.

What future evolutions of local currencies do you foresee beyond printed currencies? Where might this all go next?

I think that depends on your view of the usefulness of technology verses more вЂsmall is beautiful’, appropriate technology approaches, and your view of how quickly and how deeply we are likely to enter a post oil world. Given that may of us do so much of our everyday business with debit cards or on the internet, a paper currency can seem a little old fashioned. Why not go digital, many say?

I’m happy with that to an extent, but I’d hate us to become reliant on a piece of technology that might not be resilient in the long run. If see computers and the internet as resilient in the long run, then fine. But I struggle with the idea of a local currency run over the internet from a server in South Africa, helpful though that can be in the early days. I don’t think its resilient in the long run. You also need to solve the problem of who will pay for the cards and card readers. They are not cheap.

A second issue is that at the moment we have only two ways of valuing currency: time, or in relation to national currencies. I can see a new form of currency emerging: energy currencies perhaps denominated in watts or tonnes of C02. That would be very interesting.

Perhaps more concrete, in the medium term I would like to see the development of more regional or bioregional currencies that would include enough businesses to enable them to really spend a regional currency with each other, and in the long run help us to produce more of the things we need locally. Does it make sense, for example, to produce handmade wooden tables and chairs in every small town, or would we want that to be organised regionally? Should we aim to power our communities using regional wind, wave and biomass resources? In Liverpool we have huge wind and wave resources, which towns inland lack: I’d like us to share them.

Could we start to think about developing the range of things that we produce locally, perhaps with the help of regional banks or development organisations? I think that, economically, we need to think more about regions or bioregions, less about the scale of small communities and towns. That could be really resilient, and is my long term vision … but perhaps more EF Schumacher than Steve Jobs.

The great think about setting up a small local currency is that it does get you thinking about these issues. That’s why I’ve enjoyed studying and setting them up over the past twenty years.

Tax credit for companies providing health care gets mixed reviewFrom globalization to re-localization

Some Transition Thoughts on the Energy Bits of the Queen’s Speech

So the Queen’s Speech has set out the policy priorities for the new government, but were the policies announced a cop-out or do they set out a wartime mobilisation scale of response to climate change and peak oil? These reflections are based on the article about the speech that appeared in yesterday’s Guardian. Plans include setting up a green investment bank, which will make loans available to households for energy efficiency measures and renewable energy installations, the ‘pay-as-you-save’ scheme initially proposed by Ed Miliband. The exact amount of the loans that will be available has not yet been stated, although the Guardian speculates that it could be as much as ВЈ15,000. This is a great development, but I wonder if it could yet be taken further? How would DECC respond, for example, if a Transition group were able to get 100 people to take out loans of ВЈ15,000 each and club it together as ВЈ1.5million in order to finance a community-owned ESCO, an energy company designed to be owned by and financially benefit the community?

The risk would therefore be born across the community (well, by those who have taken out the loans for the company), and given that it would enable much larger-scale renewables schemes, would have far greater savings in terms of carbon reduction than domestic scale installations. Likewise, although it is early days for the Transition Streets initiative we are doing here in Totnes, combining some kind of ’street-by-street’ approach which incorporates behaviour change could have a deeper, longer lasting and further-reaching impact than merely dishing out money for conservation and technologies.

Another policy is to put more information on energy bills, “in order to empower consumers and to ensure fair access to energy supplies”. While I’m sure this is a good thing, I wonder how many people will understand such information. It is like the wealth of labelling now on many food products, which I would imagine very few people read, and even less people understand. While that is no reason to not have them, increased labelling needs to be accompanied by a wider awareness raising programme. My recent review of Jane Fearnley-Whittingstall’s book ‘The Ministry of Food’ noted how during World War 2 the government took clear leadership on energy reduction (e.g. “when you ride alone, you ride with Hitler” and so on…) and promoted frugality and conservation. Although we are starting to see this messaging from some energy companies, clearer messaging from government would be great.

There is a commitment to regulate the emissions from coal-fired power stations. It is hard to understand exactly what this means: as far as I am aware the only way to regulate emissions from coal fired power stations is either to burn less coal in them, close them down altogether, or to install carbon capture and storage technologies which, it is important to recall doesn’t actually exist yet. It is very difficult to fit carbon capture technologies onto existing coal fired power stations, which aren’t necessarily sited anywhere near sites where sequestration is possible.

Often, sequestration is used to enable the process of Enhanced Oil Recovery (EOR), driving out hard-to-reach oil from oil fields, and lengthening their productive life. Given that it leads to the production of more oil, it cannot be argued to be an especially low carbon technology. Also, from articles I have read, it appears that installing carbon capture and storage necessitates the burning of about a third more coal than would otherwise be burnt in order to power that process, and for the UK, whose indigenous coal production continues to fall, this decreases rather than increases energy security. There are also still some concerns as to whether carbon, once sequestered, stays where it is put.

The installation of a ‘Smart Grid’ is to be welcomed, although we await more information as to whether it is the kind of Smart Grid suggested in the forthcoming ‘Zero Carbon Britain 2030′ report by the Centre for Alternative Technology. The policy to make the infrastructure of the North Sea available to all companies in order to make the exploitation of smaller and more difficult oil and gas fields easier is a natural thing to want to do for a nation, like the UK, at the end of so many pipelines and, until recently, used to the bounty of cheap energy on our doorstep. However, it is clear that such an approach is needed precisely because all that remains in the North Sea is smaller and more difficult oil and gas fields. The concept of peak oil is seen here in isolation. Like the 2009 Low Carbon Transition Plan, which focused just on North Sea peak, not the wider global experience, the government appears to be doing much the same again.

Something not in the Speech that would have been a good addition would have been a tweak to the Feed in Tarriff announced last year by Ed Miliband. At present, the consumer is only paid 3p for each unit of electricity exported, thereby giving little incentive to reduce consumption at that household level. At the moment the tarriff encourages installing systems and harnessing the tarriffs, but doesn’t encourage the householder to also cut back on consumption. The policy about “reforming energy markets to deliver security of supply and ensure fair competition” is the second part that implies a lack of understanding of the peak oil issue. It assumes that ’security of supply’ is something purely controlled and regulated by markets, rather than geological factors.

It assumes that the 2008 price spike to $147 was something that could have been controlled if different market mechanisms had been in place. This assumption is rather dangerous, because, as recent reports such as those by the UKERC, which suggests “a significant risk of a peak before 2020″ and the Peak Oil Task Force which suggests a date of 2015 suggest, geological factors will increasingly come into play during the life of this government, and all of the market mechanisms in the world, with the exception perhaps of an Oil Depletion Protocol will do little to affect it.

Ultimately of course, if recent pieces by George Monbiot and Paul Kingsnorth are correct, home insulation and micro renewables, if pursued in the context of economic growth, will do little to reduce our carbon emissions. As Monbiot recently pointed out, figures for national carbon emissions had, until recently, failed to include emissions embodied in the manufacture and transportation of the goods we consume from other countries. When we add that, the nation’s emissions are increased by more than a half. Kingsnorth pointed out that economic growth and energy use, and by extension carbon emissions, are intimately intertwined. He mentions a study by Professor Rod Smith of Imperial College which showed that an economic growth rate of 3% would lead to a doubling of economic activity in 23 years, and that “each successive doubling period consumes as much resource as all the previous doubling periods combined”. As Monbiot summed up Smith’s findings, “if our economy grows at 3% between now and 2040, we will consume in that period economic resources equivalent to all those we have consumed since humans first stood on two legs. Then, between 2040 and 2063, we must double our total consumption again”. The policies announced in the Queen’s Speech, according to the new energy and climate change secretary, Chris Huhne, make clear that “energy security and taking real action to tackle climate change aren’t add-on extras for this new government, but are vital to our national interest”.

Unfortunately the back-to-growth-at-all-costs economic policies being consumed in other parts of the Queen’s Speech make rather a nonsense of this. Ultimately our ‘national interest’, and the national interests of generations hence, will be best served by giving up on the idea of economic growth altogether, the intentional and collective move towards a steady state economy, the rebuilding of local economies and seeing them as key drivers of the economy, a shortening of the distance between production and consumption as far as is practical, and, as MP Frank Field put it so frankly in February, “we do not know whether the rest of the world will lend us the money to maintain our debt levels, and therefore hopefully readjust to a lower standard of living, which is what this crisis actually means”.

I would argue that this government needs to broaden its focus from its promotion of localism (increased power being transferred to local bodies, Councils, schools and so on) to localisation (the rebuilding of local economic resilience, and creating local infrastructure owned and managed by local communities). There is much to cheer in the Queen’s Speech, and much that, with minor additional tweakings, could prove to be very valuable tools in the Transitioning of communities. However, pursued in the context of an overarching push for a return to growth, one has to question just how effective they will prove to be in the long run.

Gulf spill won’t dampen U.S. appetite for oilForever and a day

Eyeing the Difficult Path To a Sustainable Future

Environmentalist David Orr says the easy part of helping the United States live within its ecological limits may be passing laws, such as one that puts a price on carbon. The hard part, he maintains in an interview with Yale Environment 360 , is changing a culture of consumption that causes extensive environmental damage — and unhappiness.

Long before buzzwords like “carbon footprint” entered the general lexicon, David W. Orr was working on ways to help humanity lighten its impact on the natural world. A professor of environmental studies at Oberlin College and the author of six books, including Ecological Literacy, Orr has focused on how to best educate students about using the Earth’s resources prudently. He also has been a leading proponent of sustainable design on the country’s college campuses, and was the driving force behind building Oberlin’s $7 million Environmental Studies Center, considered a model of green architecture in the U.S.

Most recently, in his book Down to the Wire, Orr tackled the problem of global warming, which he refers to as “planetary destabilization.” The solution, he writes, will require that as the developing world raises its standards of living, the industrialized world must curtail the runaway materialism that has exacted a heavy toll on the natural world.

In an interview with Yale Environment 360 senior editor Fen Montaigne, Orr talked about the current battle over climate and energy legislation, President Obama’s missed opportunity to use his “bully pulpit” to educate the public about global warming, and what he calls the right wing’s “unconscionable misuse” of the airwaves to spread lies and misinformation about climate change.

Orr says that for America and the industrialized world to move onto a truly sustainable footing, society must awaken to what he calls the “profoundly disquieting” effects of the “frantic search for more money and more stuff.” He sees signs of this awakening in the local food movement, the new urbanism pulling people back to cities, and a growing environmental awareness among the younger generation. Much of the shift from “hyper individualism” and rampant consumerism to a greener, more community-oriented lifestyle, says Orr, “will not only be possible and not only be painless, but in fact will help us create higher levels of happiness and satisfaction.”

Yale Environment 360: This has been a very rough [few] months for people interested in the threat of global warming. There was the relative lack of action in Copenhagen, the controversy over the hacked e-mails, the stalled action on the climate bill in the U.S. Congress, and polls showing that Americans, at least, are in fact becoming more skeptical about climate change and perhaps weary of the subject.

David Orr: The good news is that climate science survived intact. The hacked emails didn’t show anything much more than professional chatter you get in the teacher’s lounge or the wash-up room outside a surgery theater in a hospital. There was nothing that impugned the science. And the one mistake that was apparently found in the IPCC Fourth Report didn’t amount to much — the Himalayan glaciers disappearing in 35 years, that was also corrected elsewhere in that report. On the public attitudes and opinions, the issues were compounded by recession on one side and people’s attention automatically sways over to economic and bread and butter issues when times are hard.

On the politics of climate, I’m actually fairly optimistic that there will be climate legislation passed. I think that there is, strangely enough, a kind of emerging consensus in some parts of the Republican Party that they can’t stonewall on this issue forever. I think the logic of the situation, the vast weight of the science, and the prospect of continually destabilizing weather patterns is kind of an inexorable force pushing us toward some kind of response to these issues... The political response so far at the national and international levels has been clearly inadequate. But I think the weight of all of this has got to change that at some point.

e360: You think some sort of legislation would be passed, in the form of cap-and-trade, or a carbon tax?

Orr: The difference is not necessarily in the mechanism, it’s the will to make the mechanism work. The best designed cap-and-trade system you can imagine, without the political will to actually execute, would be
If you get climate and energy right, you get a whole lot of other things right, as well.”

disastrous, and the same would be true of taxation... But I think either of those, or both of them in combination, would be a smart policy. The way the bill came out of the house, the Waxman-Markey bill, it was way too complicated. Way too many concessions to fossil fuel industries. I would prefer if you’ll have cap-and-trade, an auction system with the proceeds then sent back to the public, or put into public investment or some combination of the two.

e360: But the American public just doesn’t yet seem convinced of [global warming]. What’s it going to take?

Orr: Gallup polls show the American public is the least informed and most confused about the issue of any public in developed nations. It is part of the problem. Now why are they confused? There are several obvious components to an answer. One is that the educational system turns out people who really don’t understand science and how the Earth works as a physical system. And the other is, frankly, the continual flow of bad information, misinformation, outright lies, and distortion that come through the media system. So the fact that 91 percent of talk radio, according to Center for American Progress, is extreme right wing, where you’re not going to hear anything about climate change and what they do is going to be mostly wrong... This is an unconscionable misuse of the public commons to confuse the public about an issue on which there is virtually unanimity amongst scientists who study climate for a living. It doesn’t mean, however, that there are no unknowns on this issue. There are unknowns.

e360: If something is going to be done before it is too late, how do you leap that hurdle?

Orr: In the president’s Climate Action Project, which was aimed at the first 100 days of the Obama administration, we proposed the president go to the American public, right out of the starting box, and give the climate equivalent of the Day of Infamy speech. And walk the public through the science. Use what Teddy Roosevelt called the bully pulpit, as a chief educator of the public. And walk us through why this is a critical issue. So I think a good bit of what has to happen falls under the title of leadership.

e360: So clearly President Obama did not give that equivalent of the Day of Infamy speech. How disappointed are you that that didn’t happen?

Orr: Well, I think it was a mistake not to put that issue first. But that’s second guessing, and I’m just a professor in Ohio, and he’s president of the United States. But I think it should have been first for a couple of reasons. One is it is the most pressing issue. Let’s say we’ve gotten the perfect health care bill through, but the health of the planet is failing, that health bill doesn’t amount to much. Secondly, in terms of strategy, the climate and
Many people who live with a lot of consumption find life anything but sweet.”

energy issue is much more clearly, to most people, an economic issue. That is jobs and economic stimulation. Third reason is if you get climate and energy right, you get a lot of other things right as well. You lessen severe problems of security, balance of payments, pollution, unemployment, and you begin to take advantage of what Americans have typically done very well, and that’s technology. We’ve been historically very good at innovating and bringing in new kinds of technologies. That would have been in hindsight, from my perspective, a much smarter course than putting a health care bill first. But it also would have meant that the president needed to go to the public early and take an active role in driving climate legislation through Congress. I don’t think it was appropriate simply to sit back and let them hash it out.

e360: How would you judge the president’s overall performance on energy and the environment?

Orr: President Obama was given a very deep hole to climb out of. The economy was collapsing, we were fighting and losing two wars, the political environment of the country was just awful. And so he was given probably as tough a challenge as any president. On many things, the president has done I think extraordinarily well. Steven Chu, secretary of energy, is terrific. John Holdren, the [White House] science advisor, and Jane Lubchenco at NOAA — he’s appointed really good people. The stimulus package had a lot of money for wind power and development. What we don’t have is a framework for overall climate legislation. And I think that’s a huge problem. But he has done, to his credit, a great deal more than any other previous president to move us toward efficiency and renewable energy. But you always measure these things relative to the magnitude of the thing they’re trying to fix. And relative to climatic destabilization, that’s an interesting start, but it is not nearly enough at this point.

e360: You write that to really tackle this problem, countries like the U.S. have got to slash carbon emissions in the next 40 years about 90 percent, and that the average American’s production of carbon dioxide has got to go from about 22 tons a year to one or two tons. How do we get from here to there? How do you reduce the emissions of a public that’s living a pretty sweet life right now based on fossil fuels?

Orr: Well, a couple of comments. At the global level, this is being called, among other things, contraction and convergence. So developed economies
The frantic search for more stuff, and more money to buy more stuff, is profoundly disquieting.”

like the United States have got to begin to contract, and other economies will begin to converge on some number that allows us to stabilize climate. That’s the background of the picture. The foreground is, how do we actually get there? And I think there are a couple different answers to that. One is, we do need a price on carbon. And we do need clear signals to the public that when you buy a house, appliances, cars, anything that uses energy, you buy efficiency.

And secondly, we need public policies that make it easy to deploy renewable technologies. And so the Europeans have used feed-in tariffs, or in this country sometimes most states have now net-metering provisions, that you’re a small scale power producer you can net-meter, and the utility will buy back the power. Those things need to be streamlined. Public policy needs to be aligned with those long-term goals. And it is not now. You can look at any number of institutional, financial, and regulatory barriers that block any movement in that direction.

I think there’s another kind of answer, however, and that is that you say we live pretty sweet lives. But many of us don’t. And many people who live with a lot of consumption find life anything but sweet. But obviously GNP continued to rise so you’ve got to explain a gap between the amount of stuff that we make and we have and throw away, and the level of happiness or satisfaction that you’ve got. And that’s a big gap. And I think, in lots of ways, the growth economy created more junk than you needed, more expectations than it could meet, more waste than the environment could absorb, and more trouble generally than we needed to create. And the literature on happiness shows that, not surprisingly, happiness is a function of a much simpler calculation. Beyond some fairly minimal level of comfort, we find satisfaction in our friendships and social relationships. It’s what brings us together that makes us really happy and makes life satisfying. And to a great extent, the amount of stuff that we have, the frantic search for more stuff and more money to buy more stuff is profoundly disquieting... And I think the transition town movement, and the voluntary simplicity movement, and the slow food movement, and the slow money movement, are all driven by people who recognize we were defrauded. That system never worked as it was purported to work. And so I think there is a good bit of the quote “contraction” that will not only be possible and not only be painless, but in fact will help us create higher levels of happiness and satisfaction.

And I think the logic of higher fuel costs and climate change and terrorism — all these combined threats are the silver lining that there’s a better life for us that is a different way to think about society. It’s more self-contained towns. We found that when the real estate market collapsed, that the suburbs not only were lonely places fostering a lot of fossil fuel use, they were financially completely unsustainable. But they also weren’t that nice to
In making land use decisions, we need to escape from hyper individualism.”

live in sometimes. It was too much traffic. Too many hours spent in cars and freeways. The new urbanism, fairly tightly-contained places where you’ve got walking access or biking access to shops, stores, schools, employment, parks, recreation, nice downtowns — that’s now the pattern emerging in development. And it doesn’t surprise me a bit. It’s a convergence between human psychology and the need for sociability... And so we know that we can create that kind of development here. So could we make that transition? Yes. And I think that we’re moving in that direction. Fast enough? No. But there is movement in that direction.

And the logic of higher energy costs mean that the centrifugal pressures on urban development, which we call sprawl, will probably reverse and become much more centripetal, pulling people back into a coherent downtown area...

The changes are also going to have to be in public policy, the way what we tax, where we build infrastructure, if you build roads, wires, pipes — development tends to follow that. And what Portland, Oregon did years ago was to put a growth boundary around the city, which deflected investment into the city, and then secondly created a light rail system that made it very easy to move around in that system. So you go to Portland right now, it’s not Nirvana, but it’s a very nice city. There’s a recognizable downtown, it’s a 24/7 kind of place for the most part.

The larger issue to me is where politics and markets work together. Markets are where you and I say, “I.” And politics, where we conduct the public business, are where you and I say, “We.” Both within a generation, and then the “we” that also connects us to our grandchildren and the long-term future. And so I think there’s a larger political issue here that in making land use decisions and decisions about urban development, we need to escape from hyper individualism, that whatever I want, I can have, and into a very different view of the public good.

e360: You’re talking about what almost amounts to heresy in the United States, which is no more perpetual growth.

Orr: There’s a long literature on growth that shows unimpeachably that beyond some point, growth becomes ill wealth. It means you just compound your problems. The benefits begin to diminish relative to the problems it creates. And we all kind of know that. That’s no great revelation — that the idea that we can’t afford to build, let’s say, high-speed rail systems and light rail systems is nonsense. We subsidize cars. We do it indirectly. We subsidize road building, gasoline, all the military force we have to maintain to guarantee our access to cheap fuels. So we pay for
What appeared to be cheap energy wasn’t really cheap at all; you just didn’t account for it.”

these things whether we get them or not. And the assumption is we can’t afford environmental quality or sustainability, but in fact we’re paying for it. And you pay for a kilowatt-hour of electricity, and the reality is that it costs us a good bit more than that. And if you factor in costs of healthcare, asthma, lung disease, and the 20,000 to 50,000 people who die prematurely every year from breathing small particle pollution from coal-fired power plants that generate half of our electricity, all of a sudden the costs become prohibitively high. And so what appeared to be cheap energy wasn’t really cheap at all. It’s just that you didn’t account for it. You paid for it in health cost, and lost lives, and lost productivity, and land degradation, and water pollution, and so forth, but those were not tacked on to the electric bill that you got every month.

e360: On this issue of high-speed rail and light rail, do you think our sense of international competitiveness or national pride may work to the benefit of moving in the direction of more sustainable transportation, in that China is now building all these regional rail systems where they’re zipping around at 250, 300 miles an hour? Don’t you think that at some point Americans are going to go, “Hey, you know this whole green revolution, we’ve got to get on board here. We’re just lagging terribly behind Europe, behind China.”

Orr: The public [needs] to wake up and say, why doesn’t the Acela get 200 miles an hour? Why can’t we figure that out? The Chinese have done it. The Europeans have done it. Are we that dumb? And the answer is, until we decide not to be dumb, as Tom Friedman put it, “We can be as dumb as we want to be.” And we decided for the time being, that we’re going to be dumb. And it’s not an IQ problem, it’s frankly a political and communications problem.

And that’s our choice also. If the opposition party says, “We are going to throw sand in the gears and we’re not going to let us move on this.” You go back and you think, 1969, we created the Environmental Protection Agency, the Clean Air Act, Clean Water Act, Endangered Species Act, Wild and Scenic Rivers Act, Wilderness Act. We did all that, and I think there were only three or four negative votes against even the Endangered Species Act. It was Republicans and Democrats coming together.

We’ve done it in the past; there’s no reason why we couldn’t do it in the future. Except that the opposition party in this case now decides, “No, we’re not gonna play ball with you. Whatever it is, however good it is for the country, we’re not gonna play ball with you.” Now I don’t know what words you put that on. You can’t imagine — no terrorist has done that much damage to us. The Republican Party has decided, and I consider myself to be a somewhat conservative person, but this is no longer conservatism of the sort that Edmund Burke would have recognized. This is something else.

Gulf spill won’t dampen U.S. appetite for oilCome to the largest climate rally ever on the D.C. mall on April 25

The U.S. Exports More Corn Ethanol

photo credit
In the past twelve months, ethanol exports from the United States have increased from 4 million gallons in March of '09 to 46 million gallons in March of this year to places like United Arab Emirates, Brazil, Canada, and the Netherlands. This year's March figure is about 4 percent of the 12 billion gallons mandated for domestic biofuel use this year. Ethanol producers are thrilled.

From the Grand Island Independent in Nebraska:

Exports fuel Nebraska's ethanol industry
The United States has gone from being a net importer of ethanol to a net exporter, which will continue to help fuel Nebraska's growing ethanol market, said Todd Sneller, executive administrator of the Nebraska Ethanol Board.

According to the Renewable Fuels Association (RFA), data from the U.S. Department of Agriculture, Department of Commerce and the Census Bureau indicate U.S. ethanol exports increased significantly in 2010.

In March, the U.S. exported more than 45 million gallons of ethanol. For the first quarter of 2010, U.S. exports exceeded 83 million gallons. By country, Canada and the Netherlands were the top importers of U.S. ethanol. U.S. ethanol is also finding its way into Brazil and OPEC nations in the Middle East.

According to the RFA analysis, one reason for America's surge as a global ethanol trader is its current advantage as the world's low-cost producer.

"Despite the Brazilian ethanol industry's recent attempts to portray its product as always being the cheapest in the world, current prices show Iowa ethanol plant-gate ethanol prices are 50 cents per gallon lower than Brazilian ethanol prices," RFA reported. "As recently as February, that spread exceeded $1 per gallon. By way of example, a gallon of ethanol containing 10 percent ethanol from the U.S. would cost 11 cents less than a similar gallon blended with 10 percent Brazilian product."

Another reason for the growth of U.S. ethanol exports, according to RFA, is the saturated domestic market for ethanol.

"Ethanol use in the U.S. is arbitrarily capped at 10 percent per gallon of gasoline (E10). Based on historic gasoline demand trends, this arbitrary 10 percent cap, called the 'Blend Wall,' would be around 12.5-13.5 billion gallons of ethanol. The U.S. industry has the capacity to produce 13.5 billion gallons annually, with more capacity waiting in the wings," RFA reported. to continue reading. . .

There is nothing low cost about exploiting our land to produce politically driven, taxpayer subsidized ethanol through industrialized corn growing. One third of our corn crop now goes towards ethanol production and the corn growers and ethanol interests would like to see mandates for yet higher blends. How can they refer to this product as low-cost when its survival isn't even feasible without the taxpayer subsidies? Corn ethanol's already low EROEI becomes even lower after shipment overseas.

And, another important point:
In Nebraska, completion of two ethanol production facilities in Aurora and Columbus will increase the state's ethanol production capacity to 2.2 billion gallons, providing a market for more than 700 million bushels of corn. Last year, Nebraska's corn crop totaled 1.58 billion bushels. This year, Nebraska farmers planted 9.2 million acres of corn, up 1 percent from 2009.

According to Sneller, Nebraska uses about 50 million gallons of ethanol within the state, with the rest exported for use outside Nebraska.

Nebraska's extremely productive corn output is dependent upon irrigation, which is depleting the Ogallala aquifer and requires even more electrical energy to produce, thus an even lower EROEI than corn from other states. A better ethanol policy would, at minimum, exclude irrigated corn from eligibility of taxpayer subsidies. Instead, current policy is increasing irrigation demand. Nebraska's two new plants are in the midst of irrigation country.

While the rest of the world laments the BP Oil spill disaster (don't get me wrong, I do, too) most American's today are oblivious to the fact that 98% of the Great Plains ecosystems have been decimated by industrial agriculture. Exporting corn ethanol is nothing short of agribusiness insanity.

What is the Minimum EROI that a Sustainable Society Must Have? Part 3TN floods wipe out farmers’ crops