Tag Archives: EROI

Energy Return on Investment (EROI): State of Play

In my last post, I referred to the work of Charles Hall on Energy Return on Investment (EROI) and biophysical economics. Following an exchange of e-mails with Professor Hall,  he directed me to some of his more recent work, including a January 2014 paper titled “EROI of Different Fuels and the Implications for Society” published in Energy Policy (free access). The paper looks at the critical EROI question: “How many units of energy do you extract for each unit of energy you invest?”.

The paper is a veritable chartfest of all things EROI, but I will wet your appetitive with just three. First up, is an EROI comparison between different fossil fuel and biomass energy sources (click for larger image).

Mean EROI jpeg

The bad news here is that coal remains the king of EROI since you get around 40 times as much energy out for each unit of energy you put in. Hardly good for CO2 emissions trajectories and climate change.

Next up is the decline in global oil and gas EROIs (click for larger image):

Global Oil and Gas EROIs jpeg

The decline is unsurprising since we are trying to exploit ever more geologically marginal sources of oil and gas in ever more unconventional forms.

Finally, a chart showing fossil fuels up against renewables (click for larger image):

EROIs Different Energy Sources jpeg

I was genuinely surprised at this one because both wind and photovoltaic (PV) came in higher than I expected. Hall flags all the major problems with wind and PV (need for base load and so on) and also points to disputes over PV EROI methodology. Nonetheless, I have heard arguments in the past that PV is almost break-even in EROI terms; this does not appear to be the case.

There is a lot more in the paper, including numerous interesting references. When I get time, I will come back to the EROI of renewables as it seems such an important topic.

Should We All Give Up?

The frustration within the sustainability and resilience blogosphere is palpable. Oftentimes it is expressed in terms such as this: “Why even bother communicating with the mainstream, when the mainstream has no intention of listening?”

But ideas have a life of their own, and many are gradually infecting the mainstream, without the mainstream even being aware of their origin. For example, take the chart below titled “Costly Quest” taken from a Wall Street Journal article published on 28 January (behind paywall here, click for larger image):

Majors Oil Production jpeg

This is a classic case of the Red Queen syndrome, under which Big Oil has to run ever faster purely in order to stand still; that is, ever more investment for the same level of production. (A previous post dealt with the Red Queen and shale gas here.)

The Red Queen can also be described another way: a decline in the energy return on investment (EROI), under which you have to put ever more energy into an extraction and production process just to get the same amount of energy out.

EROI was first conceived of by the systems ecologist Charles Hall who later developed it more deeply into the discipline called biophysical economics, the best exposition of which can be found  in the book “Energy and the Wealth of Nations” by Hall and co-author Kent Klitgaard.

You can listen to a recent 19 January 2014 podcast by Hall talking about EROI and biophysical economics at Progressive Radio Network at the link below. Don’t get put off by the weird bird noises at the beginning. The podcast starts one minute in and Hall gets on to fossil fuel depletion issues about 25 minutes into the podcast. The first 25 minutes are still interesting as they explain how Hall got involved in biological energy systems when studying migrating salmon.


At the height of the credit crisis, the revolutionary ideas espoused by advocates of biophysical economics chimed with the times and even got an airing in the mainstream media, as, for example, in this article in The New York Times in 2009.

Five years on and this intellectual strand of thought remains marginalised, as Joseph Tainter, one of the movements most high profile supporters predicted back then:

“Of course I’m trying to send a message,” said Joseph Tainter, chairman of Utah State University’s Department of Environment and Society. “I just don’t expect there’s anyone out there to receive it.”

And many who tried to get the message out have given up, the demise of The Oil Drum being, perhaps, the most famous example. Similarly, we got a post from the blogger Question Everything yesterday making a very definitive statement:

What follows is actually something that has been brewing for a while. I started writing this a little over a year ago. A recent e-mail list exchange with some other people who have been blogging, mostly about things like climate change, energy depletion, and the collapse of civilization, reminded me of my own evolution in thinking. Several well-known luminaries in the blog and book-writing world have begun to voice a kind of remorse that their voices have been ignored. Meanwhile the world has careened toward the consequences they have warned us of. And now they are realizing that they have been tilting at windmills. Somewhere along the line I did too…..

…..In any case I plan to no longer concern myself with warning of imminent collapse or a bottleneck. In all likelihood I may, from time to time, simply mention another signpost along the way, like the current draught problems in California as indications that climate change is having its effects much sooner than expected. But I won’t dwell on how it could have been different if only people would have listened to the warnings and taken heed. I won’t complain about those in governments being so incredibly stupid and foolish. I’ve said quite enough about it already. Think of this as a kind of retirement from the role of a Cassandra.

My own position is somewhat less gloomy. Why should we be so surprised that a well-financed climate skeptic lobby would have emerged after Al Gore’s “Inconvenient Truth” and the Intergovernmental Panel on Climate Change  “Fourth Assessment Report” in 2007? Or surprised that, with an oil price spiralling above $100 per barrel, the fossil fuel industrial complex would throw more cash and technology at getting marginal barrels of oil out of the ground?

My optimism rests on the fact that our problems cannot be permanently ignored: the planet will continue to warm and energy prices will continue to rise. In The New York Times article back in 2009, Hall was quoted thus:

“It isn’t that there’s no technology,” Hall said. “The question is, technology is in a race with depletion, and that’s a whole different concept. And we think that we can show empirically that depletion is winning, because the energy return on investment keeps dropping for gas and oil.”

This is basically the core idea behind The Wall Street Journal article I commenced the post with.

So should we all give up? I think my answer is “no”: every idea has its time and biophysical economics is an idea whose time is just arriving. From the heretical to the mainstream in tiny incremental steps. Indeed, in the not too distant future, even The Wall Street Journal will believe in the idea of peak oil and dangerous anthropogenic climate change. You may call me stupid and naive; I prefer to see myself as patient.

One Reason We Struggle to Grow: Energy Return on Investment (EROI)

This week’s edition of Scientific American has a couple of great infographics put together by Mason Inman on Energy Return on Investment (EROI). Strangely, these graphics are behind a paywall on Scientific American’s web site but are available open access on the site of Nature, the sister publication, here (click for larger image).

Liquid Fuels EROI jpeg

The infographics show that we are needing to use an ever-larger amount of energy in order to harvest energy from liquid fossil fuels. From a world in which we used to invest one unit of energy in conventional land-based oil production and get perhaps 50 units out, we are moving to a world where we now invest one unit of energy in unconventional fossil fuels but only get five or six units out.

For those interested in the source of the numbers that sit behind this graphic, then Inman has done us a service by listing them all here. As would be expected in any piece on energy extraction efficiency, he also references Professor Charles Hall, the father of EROI and, indeed, conducts a Q&A with Hall here. If you want to understand the implications of a low EROI, Hall explains it this way: Continue reading

All Liquids Are Not Created Equal (Revisited)

A few weeks ago, I wrote a blog post pointing out some of the difficulties posed by the move away from ‘crude oil’ to ‘all liquids’ reporting by BP, the Energy Information Administration (EIA) and the International Energy Agency (IEA) when they publish their flagship yearly reports (see herehere and here).

I also showed some numbers taken from Table 3.4 in the IEA’s World Energy Outlook 2012 (click for larger image). The declining share of crude oil within the overall ‘all liquids’ mix is obvious.

Oil and Liquids Supply jpg

It’s worth drawing attention to some charts taken from a post by Marco Pagani on Ugo Bardi’s excellent blog Cassandra’s Legacy. Note Pagani’s post is, in turn, a summation of original work done (in Italian) by Antonio Turiel. We start with the IEA’s headline chart that shows ‘all liquids’ on a healthy (in energy terms rather than climate) rising trend:

IEA Predictions jpeg

Turiel then makes two adjustments to the chart. Continue reading

The Conjoined Twins: Peak Oil and Climate Change

Of modern-day dystopias, the conjoined twins of climate change and peak oil energy (or rather peak energy) are poor dance partners, forever out of tune and stepping on one another’s toes. Despite being conjoined through carbon, the interaction between the two is complex and, at times, contradictory. Accordingly, while most of the environmental movement has embraced both issues, it is a somewhat awkward clinch.  At the most extreme, the thesis of one negates the other: a peak energy carbon constraint caps warming; while a carbon concucopia allows economies to grow head long into a climate crunch (that they may or may not have the wealth to cope with).

Peak oil’s path to respectability has been a little more convoluted than that of climate change.  Indeed, it is still quite far from becoming the consensus. For peak oil theorists to emerge victorious they need to slay an even more entrenched existing consensus, that of neoclassical economics. Laurence Summers—a feted economist whose resume includes an academic professorship at Harvard, the role of Chief Economist at the World Bank and stints with both the Clinton and Obama administrations—had this to say about resource constraints back in 1991:

“There are no limits to the carrying capacity of the earth that are likely to bind any time in the foreseeable future. There isn’t a risk of an apocalypse due to global warming or anything else. The idea that we should put limits on growth because of some natural limit, is a profound error and one that, were it ever to prove influential, would have staggering social costs.” Continue reading