Nuclear. Oil. Whats next? thats exactly the problem

Good article. First one about energy that connects the dots with all options and whats happening and what will happen. We, our leaders, need to make the hard decisions NOW.

The next energy crisis is here


Nuclear power is dangerous, our oil supply is unstable, and alternative energy is stumbling. With no easy options left, how will we power our future?

By Michael McCullough
The catastrophe at Japan's Fukushima Dai-ichi power plant has undeniably damaged the nuclear industry, setting back its slow-building recovery from the Chernobyl accident 25 years ago. Not only has Japan, the world's third-largest economy, shut down plants (some of them permanently) that provide one-fifth of the country's electricity, but Germany, China and Switzerland moved to halt expansions and life-extending refits to their nuclear plants.

But nuclear is far from the only villain. There seems to be no source of new energy we can live with. Last year, it was deep-water oil drilling that provoked a public outcry. The leak from BP's well in the Gulf of Mexico inspired moratoriums and costly regulations not just in the United States but around the world. The accident offered new reasons to oppose carbon-belching sources like coal and oilsands.

Adding to the list of undesirable power sources, Quebec this year reacted to concerns about water contamination, methane gas leaks and other issues by imposing a near moratorium on shale gas drilling. Likewise Ontario, already committed to phase out coal power by 2014, cancelled a project to build a gas-fired power plant in Oakville last year in the face of fierce local opposition. Even renewable sources like wind power are coming under fire from residents fearful of "wind sickness." Al Gore, the world's most prominent environmentalist, last year changed his mind about biofuels, the environmental benefits of which are looking increasingly doubtful

The non-monetary costs of energy production now loom so large that governments are stuck in policy gridlock, unable to approve any new option that could help meet rising demand — with results ranging from higher gasoline prices to the rolling blackouts that Japan is now experiencing. It graphically illustrates the point made by Canadian energy economist Peter Tertzakian in his books and speeches, that we are approaching a "break point" where no major energy source is simultaneously cheap, secure and clean. Following 12 months of rising demand, catastrophic spills and political instability in the Middle East, oil is none of the above.

"What we're seeing today is very classic in terms of how history has treated energy or how society has evolved with its energy," Tertzakian says from his office at Arc Financial Corp. in Calgary. "Every few generations, there's a series of events that come together to punctuate and change the way we do things."

In his 2006 book, A Thousand Barrels a Second, Tertzakian predicted a new energy break point within 10 years, when major economies would switch from one "disadvantaged" source of energy to one, or several, other options. Now he believes that time has come.

"The hallmark of a break point is when government gets involved and starts enacting a whole series of policies that change the way things are done," he says. "It's just a matter of time before you're going to see policies implemented by major consuming countries to deal with the oil situation. And now we have a nuclear situation. In some ways, it's a double break point."

Both North America and the developing world will need to think hard about how they will produce the energy needed to meet growing demand. Even mature economies like Japan and Germany must decide how to backfill their energy needs as old nuclear plants come offline.

"The scalable winners out of this are going to be coal and natural gas," Tertzakian says. There will also be a move to renewables, but they can't replace the output of an oil well or a nuclear plant. And in the time-tested hierarchy of energy needs, security — knowing that the lights come on when you flip a switch — always comes first. Affordability comes next, and cleanliness comes last — "unless it's going to kill you," as in the case of Japan's nuclear emergency.

"What you see at a break point is a tremendous tension between those three dimensions," Tertzakian says. "People are going to have to prioritize."

There is, of course, another way of dealing with a break point, which is cutting back energy use, though it has seldom been used throughout history. "Society has become accustomed to supply-side solutions," Tertzakian observes. However, as he argued in his most recent book, The End of Energy Obesity, modern societies have at their disposal the technological tools, and possibly the social pressure, to consume less energy in absolute terms, not just per capita or per dollar of GDP. "Ironically, the one country that has made the most use of that dimension," he says, "is Japan."

If there is an upside to the new energy crisis, it's the greater understanding it gives consumers of the non-monetary costs of their energy consumption, instead of just taking the benefits for granted. "There really is no energy source that comes for free. There are issues that come with every single one," Tertzakian says. "Some will kill you slowly; some will kill you fast."