It’s a Small World After All. Home Insulation and the New Energy Economy
Last long weekend, I talked about one of Canada’s great resources: our national character – especially as it defines how we do business with one another. This long weekend, which marks summer’s peak and the slippery descent back toward (sorry for saying it) winter, I want to talk about another Canadian resource: oil.
Oil is something we don’t talk about enough in Canada. Especially considering we are now one of the world’s leading suppliers of it; and especially since our world now struggles to come up with enough of it to fuel our global economy.
Amongst the ongoing conversation about the challenges of balancing our need to address the dangers of climate change with our need to enable economic growth, another economic issue has been quietly creeping to the surface. Some reference it as energy security. Some call it energy independence. Whatever you want call it, a trip to the gas station should be enough to help you realize something isn’t quite right. And if that something is what an increasing number of economists, petroleum geologists and business leaders think it is, then the time to have a conversation about what’s happening to the slick, black lifeblood of our economy is now – not later.
Increasingly, people like Canada’s former CIBC Chief Commodities Broker, Jeff Rubin and the UK’s billionaire entrepreneur, Richard Branson are raising the alarm about a phenomenon known as Peak Oil.
- Canadian economist, Jeff Rubin’s best-selling books Why Your World is About to Get a Whole Lot Smaller and The End of Growth explore this topic in more detail
- Billionaire and entrepreneur Sir Richard Branson is a member of the UK Industry Task Force on Peak Oil and Energy Security
Peak Oil is the belief that the planet is now running out of – not oil per se – but the easy-to-get, cheap oil that so handily grew our economy through the 19th and 20th centuries.
For a long time, Peak Oil was an issue characterized by ferocious debate. But more recently consensus around the idea that the planet has in fact reached Peak Oil is forming. In 2012, even the International Energy Agency (IEA), an organization assigned the unenviable task of monitoring the planet’s oil supply, admitted that it is likely global oil production peaked in 2006.
The debate has now shifted from, “when will peak oil occur” to, “are manufactured oil (think Alberta oilsand and US shale oil) and deep sea oil going to be enough to cover the spread now that the cheap, easy stuff that sprays out of the ground has gone into decline. Especially when you consider the global economy’s 85-million-barrel-a-day (mbd) appetite, making up the difference with increasing amounts of water-, labour-, and – get this – energy-intensive manufactured and deep sea alternatives isn’t looking overly promising.
What does all this have to do with home insulation? Well, this brings me back to the August long weekend. In much the same way no one wants to talk about – okay I’ll say it again… winter – no one wants to talk about Peak Oil. But the conversation must happen at some point. And when it does happen home insulation, along with any and every other energy saving undertaking will be a big part of it.
It’s simple supply and demand. Using less traditional oil and more new oil means two things for the resource that manufactures, ships, refrigerates, heats, lights and generally fuels our planet’s entire economy: 1) supply will be made up less and less by easy, cheap crude and more and more by harder-won, labour-intensive, energy-expensive, synthetic and deep sea oil, and 2) the challenges of getting manufactured oil to market fast enough to feed our 85 million barrel-per-day habit will even further restrict supply to the economy. You don’t have to be an economist to understand what this means for price. Simply driving by a gas station will help with that.
Supply down means price up. Even worse, without too much thinking, and a basic understanding of a world scrambling to find viable alternatives for light sweet crude, Peak Oil quickly comes to be thought of as Peak Energy. You can start to see how home insulation becomes an investment: one that protects you from the now virtual certainty that energy prices will increase with every passing year.
A long weekend filled with summer fun is not the place to get into all the bad things Peak Oil means for the way of life we have grown accustomed to, but I will say this. At the very least, Peak Oil means we need to start thinking in terms of the real worth of the energy we have taken for granted for so long.
To acquire an understanding of how much our culture takes cheap abundant energy for granted, it has been proposed that you fill your car with gas, drive it until it runs out, and then get out and push it back to the gas station. Energy has incredible value and we have lost sight of this in our society. It looks as though all that is about to change.
In a Peak Oil world some are already calling a post-petroleum economy, we will be dramatically re-acquainted with the real, hard value of energy. And anything that helps us stop squandering it will be seen as an invaluable investment that pays remarkable returns.
Confronted by a future in which, not just oil, but every type of energy, becomes more precious with every passing day, the wise will intensify their search for ways to wean themselves off of energy. Home heating and cooling, often the biggest chunk of a person’s energy burn will be the smart place to start.
So, as we enjoy the last long weekend of the summer, consider having the Peak Oil conversation with family and friends. It may not be the happiest topic but it is a conversation we are all going to have to have eventually. And it’s one of those things that, while it may not be pleasant to talk about, it will certainly prove less pleasant to NOT talk about.
Like it or not, in more ways than one…
Winter is coming.