Monday, November 07, 2011

The Nonsense of EROEI: Opiate for the Masses?

Peak oil doomers wallow in the confusion of EROEI as if it were an addictive drug. The simplistic concept feeds into a new generation of doom predictions, despite the abysmal failure of peak oil predictions over the last 150 + years. When will they learn?

The quote below looks at EROEI calculations in regard to the growing of wheat, demonstrating that EROEI in food production has never been of particular concern. The author extends the argument to the relative irrelevance of EROEI for other, less important concerns.
...the reason that ERoEI doesn’t mean very much is that we’re not, an any kind of human scale, limited by the availbility of energy. The Sun simply pumps in so much energy that total energy availability simply isn’t a binding constraint upon us. What we’re interested in is usable energy and we’re quite happy to waste total energy in order to get usable. As in the growing wheat example, there’s 35 times more energy going into the system than energy we get out of it and yet we’re all just entirely delighted with said system. _Forbes

What most EROEI enthusiasts fail to comprehend is that unless the government prevents entrepreneurs from seizing opportunities, in a market economy the pricing (and potential pricing) of technologies and resources dictates where the action will go.

The reason that so many peak oil predictions of the past have gone so badly wrong, is that doomsayers (and lawyers & bureaucrats) focus on the negative at the expense of the potential positive. Entrepreneurs in the private sector tend to do the opposite, for reasons of opportunistic greed and ambition -- or merely for the sake of wanting to support a family in comfortable and secure style. If the balance of power within a nation shifts to the legal and bureaucratic sectors -- typically government regulators and private & public litigators -- opportunities for entrepreneurs tend to dry up. Public sector growth tends to choke off private sector activity -- despite the fact that a prospering private sector grows government revenues far beyond what a choked off private sector could do.

This antagonism between the negativity and limited vision of the public sector, environmental sector, litigation sector, political activism sector, tenured academic sector, labour union sector, doomer sector etc. VS. the imaginative entrepreneurial private sector, defines the future of any given society. If negativism and limited imagination wins the day, the economy contracts and opportunity disappears.

This is what happened in the Soviet Union, North Korea, Mao's China, Pol Pot's Cambodia, Chavez' Venezuela, Ortega's Nicaragua, etc etc.

The problem with EROEI addicts is that doom is powerfully salient to the human brain. When doom is entrenched, it is almost impossible for any other idea to gain traction. And yet, the history of doomsday predictions should still give pause to doomers and would-be doomers.

Here is where Al Fin energy analysts show their doomer side: Peak manpower within the developed world is a far greater problem looming on the horizon than EROEI, peak oil doom, carbon hysteria doom, overpopulation doom, resource scarcity doom, pollution doom, or any other form of doom which is able to make it into print these days. Peak manpower is a reflection of the demographic contraction within the populations of the world that have the potential to raise and educate persons who can plan, build, and maintain the new technologies which will be necessary to move from a combustion energy economy to the post-combustion economy.

It is not the shortage of materials, equipment, energy, water, phosphates, or any other mere material that is the threat. It is instead the shortage of human capital, human ingenuity, human optimism combined with human competence. Because without that human capital, we could be floating in oil and still be mired in an energy crisis, in real terms.

But addicted people tend not to think constructively, in realistic terms. And EROEI is nothing if not an addiction for doomers.

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