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Analysts See Oil Demand Peaking by 2030 as Electric Vehicles Boom
- bcaulfield 9y agoWhen will it make sense for a practical, skinflint commuter to make the switch?
- toomuchtodo 9y agoIs your commute under 40 miles round trip? You can get a Nissan Leaf today for ~$10k used, or $20k-30k new. Or a Chevy Volt, Chevy Bolt, or a reservation for a Tesla Model 3. Makes great financial sense, as it's half the cost per mile to drive an EV vs an internal combustion vehicle [1]. EDIT: I own a Nissan Leaf I paid $10k for. I charge at home (6 cents/kwh, $3 for a full charge), and my employer offers free charging at my parking garage (which I use whenever I'm not working from home). [1] http://www.umich.edu/~umtriswt/PDF/SWT-2018-1_Abstract_English.pdf http://www.umich.edu/~umtriswt/PDF/SWT-2018-1_Abstract_Engli... WARNING: PDF
- ghostbrainalpha 9y agoWith the Tax incentive in California, a used Nissan Leaf could effectively cost $6K used now. And then if your work or city offers subsidized electric charging stations... it would definitely be worth switching now. However I think there is a real chance that a fleet of automatic driving Ubers may make ride sharing cheaper than buying an electric car for most people.
- pkaye 9y agoThere are tax incentives in California for used electric cars?
- ghostbrainalpha 9y agoApologies for the bad info... Tax credits for USED electric vehicles are only happening in Colorado right now. I forgot how the math on this worked out exactly. But I saw people getting the Leaf a few months ago for about that amount.
- CapitalistCartr 9y agoI can get a 2014 Nissan Versa in good shape with 60,000 miles for ~$7,000 here, so the maintenance and fuel savings would have to be more than $3,000.
- alkonaut 9y agoI pay around $1/mile to drive my (rather new) ICE car. Of that, less than a quarter is fuel. The majority is value depreciation. I haven’t seen any detailed calculations of EV ownership costs but I think it looks optimistic to hope for half the cost. Or was the “half” just the marginal cost of the last mile driven and not the TCO per year divided my miles driven?
- sokoloff 9y agoIf you're going to buy a car anyway, it might already be today. If you're deciding between a used Nissan LEAF and a ~2005 Honda Civic, the Honda is still going to be cheaper all-in. By a lot. I daily drive a LEAF and like it a lot. It's still cost us a LOT more than my wife's 2005 CR-V over the last 3 years, because of depreciation and carrying collision insurance (due to financing the car at a 0% interest rate, but I still need to carry insurance, so the collision insurance is effectively the finance charge for me). Per mile, I pay about 0.25 kWh, which at MA electric rates comes to ~$0.05/mile for power. That would equate to a 35 mpg car buying gas at $1.75/gallon. Plus, the car needs no oil changes and is very easy on brake pads. But a 12 year old Honda (or Toyota) will be tough to beat with an electric on an all-in basis.
- EngineerBetter 9y agoUsed Renault Zoes are exceptionally cheap in the UK. £69/month battery lease, and then about £2k for the car.
- maxsilver 9y agoYesterday? If you only need typical commuter distances (less than 50 miles per day), then it's already practical to switch today. Go buy a Bolt / Volt / i3 / Leaf / Zoe / whatever. Used ones are already around, and reasonably cheap. It's only really the edge cases that aren't super practical right now. (i.e., 'what about roadtrips?', or 'what about rural lifestyles', or 'what about cross-country trips', 'what about hauling a lot of freight', etc).
- unethical_ban 9y agoUrban = Core Suburban, inter-city = Fringe Your point stands, but your assumptions are a bit off.
- niftich 9y agoRange anxiety is real, and you're underestimating its magnitude. Today, gas stations are practically ubiquitous along major population and travel corridors, so there's a huge install base of infrastructure when you're stuck in unfortunate or unusual circumstances and you need to acquire more fuel. EV-related infrastructure has a lot of catching up to do, when your EV is one traffic detour away from being inoperable, because only dozens of charging stations exist in your area.
- toomuchtodo 9y agoCharging infrastructure is getting near ubiquity. https://www.tesla.com/supercharger https://www.tesla.com/supercharger https://www.plugshare.com/ https://www.plugshare.com/
- maxsilver 9y ago> and you're underestimating its magnitude. I don't think I'm underestimating it. You are correct, EV infrastructure is poor or completely absent in most places. I mentioned the Volt and a i3 for precisely that reason. (I own a Volt for that reason). If you are worried about range anxiety, just buy an EV that has a gas backup generator, and you are fully covered in either situation.
- derekp7 9y ago
- adrianN 9y agoAs soon as you have somewhere to charge your car? Driving electrics is already cheaper today than driving a newish ICE car.
- Anon84 9y agoOil demand has been "peaking" since the 90s...
- learc83 9y agoI've never heard people saying that. There have been plenty of "peak oil" predictions, but that refers to supply not demand. Maybe I missed something?
- stouset 9y agoAnother commenter replied to your misunderstanding between peak supply and peak demand, but I’ll address the issue you actually mentioned too. Since 1980, we have never had a year where we found more untapped oil reserves than were consumed[1]. Can you explain to me how oil production can continue keep up with demand when demand outstrips new discoveries — and has, for nearly forty years? [1]: https://dothemath.ucsd.edu/2011/11/peak-oil-perspective/ https://dothemath.ucsd.edu/2011/11/peak-oil-perspective/
- bryanlarsen 9y agoThat's actually a pretty good link. It's pretty easy to read that document and come to the complete opposite conclusion. All it takes is a little more confidence that we could weather a spike in oil prices while tar sands production ramps up to meet demand.
- Theodores 9y agoControl of oil is about who extracts it and what currency they sell it in. There is plenty of oil but we are always told that it is scarce. All of this was established in the Standard Oil days when there was a glut of oil meaning that nobody could make money at it. The trick was to manage the supply so the price was high. This is not to deny that we are burning the oil at a silly rate to therefore run out. However, the story of scarcity told along the way is not quite what the peak oil believers would have you believe.
- adventured 9y agoAt the same time the Permian has been found to contain tens of billions of barrels of oil beyond what was anticipated could be extracted just ten years ago. Undercounting is almost universal throughout oil's industrial history, and tilts toward there being a lot more. Pioneer pegs Spraberry/Wolfcamp at 50 billion barrels (and Eagle Ford at 25 billion). The Permian will end up being comparable in size only to Ghawar, with ~100 billion barrels or more (Pioneer says 150+ billion, other studies say 70-80 billion, and so on). That's based on today's technology, tomorrow we'll be able to extract more. Cross the border into Mexico, you're going to find more massive shale deposits that we haven't even looked at yet (it doesn't just magically stop at the Texas border very obviously). That'll happen in the next ten years. There's $6 or $7 trillion worth of oil in Texas that was almost entirely off the table as a resource as recently as 2007.
- JohnStudio 9y agoMy question is the demand collapse, and transition to a demand spike. The current models of increased load, like demand reduction and management companies that do nothing more than broker kW for incentives for shut-down during high peak times - et al. https://energy.gov/eere/wipo/demand-reduction-0 https://energy.gov/eere/wipo/demand-reduction-0 // --> so, as we shift away from fossil fuels/oil .. who are the great tycoons of electrical grid creeping?
- nordsieck 9y agoVery little oil is used to power the grid. It's almost all used in transportation.
- rgbrenner 9y agobut the grid does use natural gas for peaker plants to respond to demand changes. Natural gas comes from oil wells. If demand for oil reduces, and wells close, natural gas production will decline too.
- pm90 9y agoWhile Natural Gas was considered a byproduct in earlier times when it couldn't be harvested efficiently (and had to be "flared"), current technology does allow us to do so, and wells targeting gas specifically are not uncommon.
- switchbak 9y agoAccording to the U.S. Energy Information Administration, you are correct in that very little fossil fuel is used in electrical energy production [1]. However, quite a lot of natural gas is used, which is what the GP was describing, so I think his question is still quite relevant. [1]: https://www.eia.gov/energyexplained/images/charts/consumption-by-source-and-sector-large.jpg https://www.eia.gov/energyexplained/images/charts/consumptio...
- toomuchtodo 9y agoYou're already seeing utility scale battery storage displace the most expensive oil and natural gas peakers who operate less than hundreds of hours per year (Tesla has an additional order in Australia, and a new order in New Zealand after the press from the Hornsdale Power Reserve [1]). The winners will be renewables, battery storage owners who can arbitrage, and technology companies who can arbitrage using distributed resources in partnership with owners of those resources (ie Tesla and company). [1] https://en.wikipedia.org/wiki/Hornsdale_Wind_Farm#Hornsdale_Power_Reserve https://en.wikipedia.org/wiki/Hornsdale_Wind_Farm#Hornsdale_...
- olfactory 9y agoShouldn’t this change US Mideast policy immediately? My guess is that planners don’t believe this to be true.
- splouk 9y agoWhy would it?
- olfactory 9y agoMost of the “investments” in “stability” of the region have payoffs in the many decades.
- the_duke 9y agoBy the estimate, peak oil is still a long time off, and just crossing peak oil does not mean that oil will become unimportant over night.
- olfactory 9y agoTrue, but much of the political importance of oil has to do with the threat of a sudden oil shortage. The first defense (for the US) is to create massive reserve tanks, the second is to befriend oil producing regimes, the third is to invest trillions propping up those regimes.
- CapitalistCartr 9y agoThe year petroleum usage peaks is unknowable at present, but it obvious its coming. But the year will only be significant in hindsight. There have been many plateau years before. In 2007 Worldwide usage was 86.3 MBPD, in '08 it was 85.8, in '09 it was 84.3, then in 2010 it was back up to 86.4. All due to the economic slump, of course, but now every pundit will saying with every tiny slowdown "the end is nigh".
- pwaai 9y agoI'm not really convinced we will see oil go away. We've been saying peak oil since the 70s. The US military as a whole still relies heavily on oil. Burning oil is still the only reliable propulsion for space programs. But more importantly the whole global warming, anti-oil movement has been to minimize the impact of OPEC on US, and put pressure on oil producing nations, largely Russia. OPEC remains the only organization to outwit the US by exploiting their reliance on it. Take a look at the oil shock during Carter's administration. With fracking the US does not need OPEC/Saudi as they used to and they are freaking out. The main countries whose economy largely depends on oil have already suffered the economic consequences: Venezuela, Russia, etc. They also happen to have earned the ire of US by not submitting to their rule. Electric cars will still be well out of reach from the rest of the population (Tesla shareholders/shills will say not for long) and combustion engine will still be in demand. It was one thing to confront the US as USSR or when US oil production was low, it's a whole new ball game now. It's no coincidence with fracking on US soil, we started to see a decline in crude oil prices, and oil producing countries panicking.
- tonyedgecombe 9y agoBut more importantly the whole global warming, anti-oil movement has been to minimize the impact of OPEC on US, and put pressure on oil producing nations, largely Russia I don't think so.
- njarboe 9y agoI always find it strange that people in the oil business talk about the "oil demand" without respect to price. Maybe this idea comes from when the West was pumping oil at maximum rates, fracking did not exist, and the OPEC cartel could control the price by fiat (and before OPEC I have heard the oil price was controlled by the output in Texas). At that time there was a price set by OPEC and they pumped to meet demand at that price. In that environment the using the phrase "oil demand" for "oil usage" made sense. But in today's world OPEC does not seem to be able to set the price very well. Peak "oil demand", where demand is determined by the peak amount of oil consumed, will depend on the price and uses of oil in the future. Some crazy future tech in 2045 which makes heavy oil and tar sands profitable to extract and turn into carbon fiber at $100 a ton might replace structural steel. This could push oil usage up to a new peak, even if a previous "oil demand" peak happened in 2030, when we decided it was really stupid to burn this great chemical stock for raw energy.
- pm90 9y agoWhen I studied organic chemistry in high school, I vividly recall one of the authors of the chemistry textbook saying something to the tune of: its unbelievable how much stuff you can make with petroleum but our civilization has decided the best use is to burn it. If the world's population continues to grow at its current pace, and more people are lifted out of poverty, the demand for petrochemicals and petroleum derived products will only keep increasing. And in the further future when humans colonize other planets, petroleum will be a uniquely Earth-based resource making it even more valuable.
- philipkglass 9y agoAnd in the further future when humans colonize other planets, petroleum will be a uniquely Earth-based resource making it even more valuable. If you have electricity, water, and a carbon source, you can manufacture the hydrocarbons currently sourced from petroleum. Small scientific colonies would import terrestrial hydrocarbons just like they would import terrestrial aluminum and glass, of course, but if you're picturing self-sustaining space industrialization and colonization, it won't be worth sending hydrocarbons from Earth to Mars. Hydrocarbon synthesis also puts an (admittedly high) upper limit on the cost of making organic chemicals on Earth. Some Peak Oilers were confused about this, imagining fossil resources as irreplaceable magic. "It's not just fuel -- pesticides, pharmaceuticals, and dyes are made from oil too!" they'd say, implying that you can't have modern pharmaceuticals without oil. But that's like saying that you can't make paper without trees. The reason that paper is overwhelmingly made from trees is because that's currently the cheapest way, not because other ways are unknown. If the abundance/cheapness of feedstocks changes, so will their share of the market. (And costs will go up too, of course. The cost of refined liquid fuels goes up nearly linearly with the cost of crude oil. The cost of drugs/dyes/pesticides rises much less, because only a small share of their total cost of production came from simple hydrocarbon feedstocks in the first place.) With the exception of nuclear fuels, which are truly "used up" during fission or fusion, all atoms are recyclable.
- tristanj 9y agoAnother reading of this report: Oil consumption will remain at today's level or higher through 2040. Present oil consumption is 99 Mb/d, will peak at 106 Mb/d in 2030, then decrease to ~97 Mb/d by 2045. Honestly it's a lot less rosy than the title suggests.