Energy crisis

Introduction
• • • Our civilization has evolved based on an abundant supply of cheap oil The transportation industry and agricultural fertilizers heavily depend on oil Oil demand is projected to rise to 121 million barrels per day by 2025 (International Energy Outlook, EIA, 2004) The Energy Crisis is often overlooked based on the following misconceptions: 1. “Higher prices will bring in larger investments, which will lead to more production” 2. “Rise in prices will lower consumption” 3. “Oil shale and tar sands will replace conventional oil” 4. Fudging of reported reserves by oil companies and countries for political/economic reasons 5. “Many previous ‘crisis’ predictions proved wrong – this one will too. • The day-to-day market prices of oil reflect many factors like the current stocks, shipments, economic situation, speculative investment, etc. and not so much the size of reserves of oil We have now reached a stage in the exploitation of the earth where trying harder to produce more oil can have only limited results Oil consumption on a short-term basis does not depend on the price of oil, as is the case for other goods. There is a large time lag before consumers shift to alternatives or reduce demand In fact, some experts believe that a rise in oil prices increases demand on a short term basis. E.g Oil and natural gas demand growth rates in China have been in the range of 7-15% per year since 1999, despite the tripling of oil prices since then.

Geopolitical reasons
Energy crisis is generally misconstrude as lack of resources rather it is the disruption in the distrubution of supply of the resources. energy crisis refers to the blockades and as a consequence multiple raise in the fuel price all over the world in petroleum. the genesis of energy crisis is deeply laid in the history of Arab-Israel conflict. OPEC was constituted with a purpose of regularising supply and having uniform price. In 1973 when 6days war brokeout between Israel and Arab as a retaliatory measure OPEC raised the prise from 1.5$/barrel to 7$/barrel which generated shock waves in the economy. for the first time it was felt that every country must have the concept of energy security. In 1979 Iranian revolution led to another severe crisis and there was a 3 fold price hike. In 1980 it settled around 23$/barrel. The third oil crisis came during Invasion of Iraq over kuwait. The petroleum prises are roaring high 73$/barrel many of the developing countries India, china recieved backlash in the economies. Many of S.E.Asian countries

sauash buckelled but in 1996-97 there was a surprising fall in the price of petroleum it is lowest around in the history 10$/barrel because of three reasons, 1. economic crisis in south east asia 2. winters were mild in temperate countries thus demand fell in europe and us 3. food for oil program in iraq so supply was greater. In 2008 the energy crisis were at 150$/barrel it was highest ever in the international market due to forward trading speculation and demand from china and india. But now the prises are low because of global economic meltdown. geographically enery crisis should include over use of all non renewable resources and it is an indication of a major future crisis which a world can face.

Future Exploration

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The major oil fields in the world have already been discovered – the largest fields are always found first Except for some parts of the China Sea and of the western desert in Iraq, major regions in the world have been fully explored. Advances in geological technology allow us to predict promising areas for oil – we now know reasonably well where new oil will be found Oil in the Caspian Sea has high sulfur content which corrodes the pipes and is expensive to extract and refine. Caspian Sea oil is not likely to become a significant factor in the world oil scenario.

Non-conventional Oil to the Rescue?
• “Non-conventional” oil produced from oil shale and tar sands may become economical as oil prices skyrocket Canada and Russia may have 300 billion bbl of tar sands and shale oil. Venezuela has 1.2 trillion bbl of oil (mixed with heavy metals and sulfur) (Campbell, 1998) Extraction from oil shale and tar sands is slow, expensive, heavily polluting and resource- (e.g. water) and time-consuming It may not be possible to achieve the necessary rates of production to meet demand by processing oil shale / tar-sands, even when it is economical

After Oil – Natural Gas?
• • Natural Gas cannot be a permanent replacement for oil Use of natural gas in daily life, (e.g. as transport fuel) requires extensive infrastructure build-up

The production of natural gas will peak between 2020 - 2030 as well, hence it is only a temporary solution (Goodstein) Delhi has shifted to running all its public transportation buses on gas, greatly reducing the levels of air pollution India does not have large gas reserves. The best option for India is to obtain gas from Iran, but a gas pipeline across Baluchistan (Pakistan) may have significant security liabilities

The Way to a New Tomorrow

Three approaches to solution – – – Increase supply (Scientists/Technicians/Managers) Reduce demand (Economists / Policy makers) Alternative sources (Scientists and Economists)

Efforts are required in all three arenas

There are limits to Supply
• Geological, technical and economic constraints limit supply growth • • With advanced technology, we are aware of most of the new discoveries which will be made. Possibility of production improvements from exploration and extraction are useful but limited

Increase in supply will only postpone, but not alleviate the problem.

Reducing Our Requirements
• • Curbing demand and wanton use of energy resources is a much more effective and practical strategy Energy conservation efforts must be taken up by Government bodies – and private agencies - on a large scale. Very large savings are possible. Energy prices should be graded to punish wasteful behavior and reward efficiency The three major areas to attack are – – • Energy reduction in industry in Transport -- by the Population

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India has a comparatively low per capita energy consumption of 1.5 barrels/capita-year, but it is increasing (Europe-Japan-US consume 12-25 barrels/capita-year, McKillop, 2004) Large population growth will itself cause an increase in energy consumption World population grew 0.33% faster from 1979-1999 than did world energy production Efforts to reduce population will go a long way towards reducing demand for energy

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Tackle the Transport Industry
• • 90% of the transport industry is fueled by oil Improve public transportation – quality of vehicles and comfort of journey - use specialised bus-bodies for different services. Major obstacle – Convenience of private vehicle v/s that of public transportation Encourage railway use for long distance goods transport. Trains running on electricity are more environment friendly as well as more energy efficient, since the frictional force of steel on steel is the lowest

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Energy Reduction in Industry
• • • Indian Industrial associations have had energy-conservation programmes for a long time. There are many energy-efficiency engineers Now we need a Crash Programme, with many more incentives and bonuses for energy reductions in processes, product design and product user -- and penalties for failure.

Japan has shown that it is possible to drastically improve its GNP:Energy ratio .. Although Japan imports virtually all of its oil, rising crude prices do not hurt as much as they have in the past because Japan's economy has now been made less oil-dependent. Japan's dependence on oil for its energy needs, which stood at 77% around the time of the first oil crisis of 1973, has now dropped below 49%, according to Japan's Agency for Natural Resources and Energy. This decline reflects the progress of efforts in industry to reduce the amount of oil and energy used. As a direct result of these efforts ... For a $10 increase in oil price, according to the IMF (2004), Japan’s GNP would lose 0.4%,. By way of contrast, China’s GNP would lose 0.8%; The Philippines’ GNP would lose 1.6 % India’s GNP would lose 1.0 %

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The transition to Alternative Energy Sources
• • Demand can only be reduced in limited amounts To sustain our population, we must make an effective shift towards alternatives, and preferably to renewable sources of energy A smooth transition to the new sources of energy is also crucial and the importance of this may be overlooked. We need to start this transition mechanism soon, even if the oil peak may not be immediate Maximal generation of electricity from renewable sources, like wind and hydro, on a large scale, is one direction India could move toward in the post-peak era. Wind farms are still very underdeveloped in India, they can be linked to grids based on long distance transmission of electricity at HV-DC which has very low losses Electricity is an environmentally friendly option, as its use does not result in any emissions Electric vehicles could become economical with rising oil prices (Efficiencies of 50% are envisaged assuming renewable sources, battery losses of 20%, regenerative braking, etc… Rechsteiner,2004) Hydel Power has been explored in our country; the potential in Nepal has been explored, but not yet tapped India’s wind power potential has been assessed to be 45,000 MW but the installed capacity only 1,700 MW (MNES, 2003) is

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India has the advantage of being a tropical country which receives more than 5,000 trillion kWh solar energy per year. The main obstacle in utilizing solar power is the high technology cost involved and low energy density With the discovery of monazite sands India has huge potential for nuclear energy, but on the backdrop of Japan tsunami the major issue is safety concerns.

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Sources
  Alok ranjan sir notes Google

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