Searching for a Miracle: ‘Net Energy’ Limits & the Fate of Industrial Society

Conventional energy sources such as oil, gas, coal, and nuclear are either at or nearing the limits of their ability to grow in annual supply, and will dwindle as the decades proceed—but in any case they are unacceptably hazardous to the environment. And contrary to the hopes of many, there is no clear practical scenario by which we can replace the energy from today’s conventional sources with sufficient energy from alternative sources to sustain industrial society at its present scale of operations. To achieve such a transition would require (1) a vast financial investment beyond society’s practical abilities, (2) a very long time—too long in practical terms—for build-out, and (3) significant sacrifices in terms of energy quality and reliability.

Perhaps the most significant limit to future energy supplies is the “net energy” factor—the requirement that energy systems yield more energy than is invested in their construction and operation. There is a strong likelihood that future energy systems, both conventional and alternative, will have higher energy input costs than those that powered industrial societies during the last century.We will come back to this point repeatedly.

The report explores some of the presently proposed energy transition scenarios, showing why, up to this time, most are overly optimistic, as they do not address all of the relevant limiting factors to the expansion of alternative energy sources. Finally, it shows why energy conservation (using less energy, and also less resource materials) combined with humane, gradual population decline must become primary strategies for achieving sustainability.

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The world’s current energy regime is unsustainable. This is the recent, explicit conclusion of the International Energy Agency1, and it is also the substance of a wide and growing public consensus ranging across the political spectrum. One broad segment of this consensus is concerned about the climate and the other environmental impacts of society’s reliance on fossil fuels.The other is mainly troubled by questions regarding the security of future supplies of these fuels—which, as they deplete, are increasingly concentrated in only a few countries.

To say that our current energy regime is unsustainable means that it cannot continue and must therefore be replaced with something else.However, replacing the energy infrastructure of modern industrial societies will be no trivial matter. Decades have been spent building the current oil-coal-gas infrastructure, and trillions of dollars invested. Moreover, if the transition from current energy sources to alternatives is wrongly managed, the consequences could be severe: there is an undeniable connection between per-capita levels of energy consumption and economic well-being.2 A failure to supply sufficient energy, or energy of sufficient quality, could undermine the future welfare of humanity, while a failure to quickly make the transition away from fossil fuels could imperil the Earth’s vital ecosystems.

Nonetheless, it remains a commonly held assumption that alternative energy sources capable of substituting for conventional fossil fuels are readily available—whether fossil (tar sands or oil shale), nuclear, or a long list of renewables—and ready to come on-line in a bigger way. All that is necessary, according to this view, is to invest sufficiently in them, and life will go on essentially as it is.

But is this really the case? Each energy source has highly specific characteristics. In fact, it has been the characteristics of our present energy sources (principally oil, coal, and natural gas) that have enabled the building of a modern society with high mobility, large population, and high economic growth rates. Can alternative energy sources perpetuate this kind of society? Alas, we think not.

While it is possible to point to innumerable successful alternative energy production installations within modern societies (ranging from small homescale photovoltaic systems to large “farms” of threemegawatt wind turbines), it is not possible to point to more than a very few examples of an entire modern industrial nation obtaining the bulk of its energy from sources other than oil, coal, and natural gas. One such rare example is Sweden, which gets most of its energy from nuclear and hydropower. Another is Iceland, which benefits from unusually large domestic geothermal resources, not found in most other countries. Even in these two cases, the situation is more complex than it appears.The construction of the infrastructure for these power plants mostly relied on fossil fuels for the mining of the ores and raw materials, materials processing, transportation, manufacturing of components, the mining of uranium, construction energy, and so on. Thus for most of the world, a meaningful energy transition is still more theory than reality. But if current primary energy sources are unsustainable, this implies a daunting problem. The transition to alternative sources must occur, or the world will lack sufficient energy to maintain basic services for its 6.8 billion people (and counting).

Thus it is vitally important that energy alternatives be evaluated thoroughly according to relevant criteria, and that a staged plan be formulated and funded for a systemic societal transition away from oil, coal, and natural gas and toward the alternative energy sources deemed most fully capable of supplying the kind of economic benefits we have been accustomed to from conventional fossil fuels.

By now, it is possible to assemble a bookshelf filled with reports from nonprofit environmental organizations and books from energy analysts, dating from the early 1970s to the present, all attempting to illuminate alternative energy transition pathways for the United States and the world as a whole.These plans and proposals vary in breadth and quality, and especially in their success at clearly identifying the factors that are limiting specific alternative energy sources from being able to adequately replace conventional fossil fuels.

It is a central purpose of this document to systematically review key limiting factors that are often left out of such analyses.We will begin that process in the next section. Following that, we will go further into depth on one key criterion: net energy, or energy returned on energy invested (EROEI).This measure focuses on the key question: All things considered, how much more energy does a system produce than is required to develop and operate that system? What is the ratio of energy in versus energy out? Some energy “sources” can be shown to produce little or no net energy. Others are only minimally positive.

Unfortunately, as we shall see in more detail below, research on EROEI continues to suffer from lack of standard measurement practices, and its use and implications remain widely misunderstood. Nevertheless, for the purposes of large-scale and long-range planning, net energy may be the most vital criterion for evaluating energy sources, as it so clearly reveals the tradeoffs involved in any shift to new energy sources.

This report is not intended to serve as a final authoritative, comprehensive analysis of available energy options, nor as a plan for a nation-wide or global transition from fossil fuels to alternatives. While such analyses and plans are needed, they will require institutional resources and ongoing reassessment to be of value.The goal here is simply to identify and explain the primary criteria that should be used in such analyses and plans, with special emphasis on net energy, and to offer a cursory evaluation of currently available energy sources, using those criteria.This will provide a general, preliminary sense of whether alternative sources are up to the job of replacing fossil fuels; and if they are not, we can begin to explore what might be the fall-back strategy of governments and the other responsible institutions of modern society.

As we will see, the fundamental disturbing conclusion of the report is that there is little likelihood that either conventional fossil fuels or alternative energy sources can reliably be counted on to provide the amount and quality of energy that will be needed to sustain economic growth—or even current levels of economic activity—during the remainder of the current century.

This preliminary conclusion in turn suggests that a sensible transition energy plan will have to emphasize energy conservation above all. It also raises questions about the sustainability of growth per se, both in terms of human population numbers and economic activity.