A Historical Perspective on Global Energy Transitions - IIASA

A <strong>Historical</strong> <strong>Perspective</strong> on
Global Energy Transitions
“Modeling the Oil Transition”
Washington DC
April 20-21, 2006
Arnulf Grubler
Yale FES and IIASA

Energy Transitions
• Change in one state of an energy
system to another one, in terms of:
-- Quantity
-- Structure of end-use and supply
-- Quality
• With due regard to differences in
-- space: “where”
-- time: “when”
<strong>Historical</strong> Energy Transitions
Arnulf Grubler

Main Energy Transitions: History
• Non-commercial → commercial
• Renewable → fossil
• Rural → urban
• South → North → South
• Low exergy → higher exergy (H:C ratio↑)
• Improved efficiency/productivity
• Conversion deepening
(e.g. electrification)
• Increasing supply/demand density
• Desulfurization, Decarbonization
<strong>Historical</strong> Energy Transitions
Arnulf Grubler

World Primary Energy Demand
1800-2000 in 25 yr intervals
Per Capita Energy Use (GJ)
200
150
100
50
Industrialized
World Average
Area equals 2000
World energy use:
~430 EJ
IND:
“take-off” ~1850
“plateau” ~1975
DEV:
“take-off” ~1975
“plateau” ??
0
Area equals
Developing
0 1800 world 2 4 6 8
energy use:
~20 EJ Population (Billion)
<strong>Historical</strong> Energy Transitions
Arnulf Grubler

World Primary Energy Supply
Gtoe
10
8
6
World primary energy use (Gtoe)
Nuclear
Hydro
Gas
Oil (incl. feedstocks)
Coal
Trad. renewables
Commercial
aviation
Nuclear
energy
Microchip
4
2
Steam
engine
Electric
motor
Gasoline
engine
Vacuum
tube
Television
0
1850 1900 1950 2000
<strong>Historical</strong> Energy Transitions
Arnulf Grubler

World Primary Energy Substitution
100
80
Coal
Fraction (%)
60
40
Wood Non-commercial
Oil
20
Gas
Nuclear
0
1850 1900 1950 2000
<strong>Historical</strong> Energy Transitions
Arnulf Grubler

Measuring US Energy Transitions
by rel. market shares (top) and absolute amounts (bottom) of primary energy use
1.00
0.75
Fraction
0.50
0.25
0.00
1800 1825 1850 1875 1900 1925 1950 1975 2000
10000.0
1000.0
100.0
Peak in market share
precedes absolute
production peak
by ~60 years:
Wood 1800/1860
Feed 1860/1920
Oil 1975/??
Mtoe
10.0
1.0
0.1
1800 1825 1850 1875 1900 1925 1950 1975 2000

World - Two “Grand” Transitions
SHARES IN
PRIMARY
ENERGY
1850-1990
Oil/Gas
0% 100%
20% 80%
40%
1990
1970
60%
60%
1950
40%
80%
20%
1920
100%
0%
Coal
20%
1900
40%
1850
historical
60%
0%
80% 100%
Renewables/Nuclear
<strong>Historical</strong> Energy Transitions
Arnulf Grubler

Oil/Gas
0%
100%
20% 80%
Oil & gas
forever
Path Dependent
Futures in
IIASA-WEC
and
IPCC SRES
Scenarios
40%
1990
1970
A1
60%
100%
0%
Coal
80%
60%
1950
1920
1900
20%
A2
40%
A1F1
Return
to coal
A2
B
B2
B1
Muddling
through
1850
historical
60%
40%
A1B
A3
C
20%
A1T
Grand
transition
0%
80% 100%
Renewables/Nuclear
<strong>Historical</strong> Energy Transitions
Arnulf Grubler

Drivers of <strong>Historical</strong> Energy Transitions
• Technological change in end-use: steam
engines, automobiles, electric motors and
lights
• Supply: no evidence of resource scarcity, but
plenty of evidence of TC
(coal chemistry, offshore and
“unconventionals”, nuclear
• Price volatility (recurring): trigger of TC and
structural change
• Policy: few success stories, lots of failures
(Project Independence, breeders)
• Quality matters: electrification,
decarbonization
<strong>Historical</strong> Energy Transitions
Arnulf Grubler

Dewatering Coal Mines
<strong>Historical</strong> Energy Transitions
Arnulf Grubler

Technology Transitions are also Social Ones
1838: Resistance to New Technology (Railways)
<strong>Historical</strong> Energy Transitions
Arnulf Grubler

Technological Change in US Road Vehicles
Source: N. Nakicenovic, 1986.
<strong>Historical</strong> Energy Transitions
Arnulf Grubler

Drivers of Transitions (US cars): Continued
Improvements and Complementary Infrastructures:
Cost declines of gasoline refining, T&D
Source: Fisher 1974 and EIA, 1985
Cost declines of cars
and increases in road infrastructures
Source: Grubler, 1990.
<strong>Historical</strong> Energy Transitions
Arnulf Grubler

Energy Efficiency (%) and Emissions (g/km) for
Horses, and Early and Contemporary Automobiles
Horses
Cars
Cars
(ca. 1920)
(1995)
Engine efficiency, %
4
10
20
Wastes
Solid
400
–
–
Liquid
200
–
–
Gaseous,
Carbon (CO 2 ) a
170
120
70
Carbon (CO)
–
90
2
Nitrogen (NO x )
–
4
0.2
Hydrocarbons
2 b
15
0.2
a Total carbon content of fuel
b Methane
<strong>Historical</strong> Energy Transitions
Arnulf Grubler

Energy Quality
• Multiple dimensions:
-- exergy or form value
-- H/C ratio
-- emissions (particulates, sulfur)
• Few studies and largely ignored in models
• Tradeoffs between quality and price initially
resolved in favor of quality
(subsequent cost declines via
“learning-by-doing”)
• Quality trends more pronounced at end-use
(supply improves only via structural change
and regulation)
<strong>Historical</strong> Energy Transitions
Arnulf Grubler

US - Final Energy Structure
100%
90%
80%
Grids
Percent
70%
60%
50%
40%
Liquids
30%
20%
Solids
10%
0%
1920 1930 1940 1950 1960 1970 1980 1990 2000
<strong>Historical</strong> Energy Transitions
Arnulf Grubler

USA - Decarbonization (tC/toe)
1.3
1.2
wood
1.1
1.0
0.9
0.8
primary energy
(energy system)
coal
oil
0.7
0.6
energy end-use
(consumer)
gas
1850 1900 1950 2000 2050
Data Source: US DOE EIA (2001): 1960-1999; Grubler (1998):

On Hubbert Curves
• Sparse historical evidence (whale oil)
• Assumed symmetry condition neither
empirically or theoretically confirmed
• Continued uncertainty: “Ultimately
recoverable reserves” change with
exploration and new technologies
• Interaction (market response, i.e. demand &
substitution) ignored or underestimated
• Economic implications of “peaking” not
rigorously argued or tested
<strong>Historical</strong> Energy Transitions
Arnulf Grubler

Whale Catch and Whale Oil Prices
Introduction of kerosene refining
and kerosene lamps
Whales caught per year
Whale oil price US$2003/gal
Source: Sperm catch: P. Best, 2002, IWC SC/56/IA5; Prices: U. Bardi, 2004, based on Starbuck, 1878.
<strong>Historical</strong> Energy Transitions
Arnulf Grubler

An Early “Hubbert Peak”
“…the data at hand in regard to the gas still
available underground … make it probable that
the annual output will never be very much more
than it was during the period 1916 - 1920.”
R.S. McBride and E.G. Sievers (USGS),
Mineral Resources of the United States, 1921, p.340.
US gas production:
22 Mtoe in 1920
100 Mtoe in 1995
<strong>Historical</strong> Energy Transitions
Arnulf Grubler

Recurring Perceptions of Geological and
Environmental Limits
• 1865: W.S. Jevons The Coal Question
• 1884: J. Ruskin Storm Cloud of the 19 th Century
• 1919-22: Oil rationing and scarcity fears in US
• 1970s: Limits to Growth and “energy gap” studies
• 1980s: First globally balanced supply-demand
Energy in a Finite World (1981)
Oil price collapse and expansion
of non-OPEC production (>1986)
• 1990s: Interest shifts to climate change
<strong>Historical</strong> Energy Transitions
Arnulf Grubler

Energy in a Finite World (Haefele et al., 1981):
Conventional Wisdom of the 70s (rapid demand growth,
supply peak in 1990s) New Information: Uncertainty of
reserves and importance of unconventional oil
<strong>Historical</strong> Energy Transitions
Arnulf Grubler

North America: Estimated Maximum Oil Production
(all sources) EiFW, 1981 and actual
actual for conventional
and incl. unconventional oil
1.6
1.4
1.2
1.0
0.8
0.6
0.4
0.2
0.0
1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030
<strong>Historical</strong> Energy Transitions
Arnulf Grubler

Resource Constraints Beyond Energy:
Estimated Water Use for Synfuel Production.
Source: EiFW, 1981.
<strong>Historical</strong> Energy Transitions
Arnulf Grubler

OIL: How Much Did We Know?
Density of Exploratory Drilling per
(potentially petroleum bearing) Sedimentary Area
Source: Grossling, 1976.
<strong>Historical</strong> Energy Transitions
Arnulf Grubler

OIL: Where Did We Look?
Prospective Sedimentary Areas and Oil Drilling Densities as per
1975 and per 2003
Almost inverse relation between potentials and drilling efforts!
Canada
USA
•••
•••
•••
• ••
Western Europe
FSU
•••••••••
••••••••••••
••••••••••••
••••••••••••
••••••••••••
•••••••••••
• •
••••••••••••
••••
•
••••
• •
•
••••
Middle East
China
Asia exc. China
Africa
Australia
•
South America
Wells drilled through 1975 shown in black. Wells drilled 1976 through 2003 shown in red.
Each circle represents 50,000 wells. Data through 1975 and relative petroleum prospective area from Grossling: “Window on Oil”
Wells drilled 1976 through 2003 per World Oil, August issue 1977 through 2003.
From the 1.9 million wells drilled worldwide since 1975 three quarters were drilled in mature oil
provinces (esp. the USA), classified in 1975 as “close to drilling saturation”.
Update courtesy of Jeff Possick, Yale FES, 2004

Lessons Learned
(even if sometimes forgotten)
• Resource availability is dynamic, “constructed” by
changing economics, technology, and geological
knowledge
• Feedbacks and responses often more dynamic than
brains or models expect
• Constraints beyond geology important: R&D, capital,
environment
• Drivers of Transition: Importance of technological change,
esp. in end-use
(weak point in scenarios and models of future transitions)
• Analysis needs to consider all factors
• Geological depletion and “mid-point” studies that ignore(d)
potential of alternatives, economics, technology, and
behavioral and market responses were both historically
wrong and offered bad policy advice
(Project Independence, Synfuels Corporation,…)
<strong>Historical</strong> Energy Transitions
Arnulf Grubler