Two comments. First, while you're right that the limited EROEI for ethanol means that we are overestimating the "net" production from the energy sector, this is nothing new. All fuels take energy to create them. Some oil produced in some regions has rather poor EROEI. Takes considerable energy to drill in the North Sea or to awaken a played-out field with tertiary recovery. Trying to measure this for each different energy source and derate the production figures to calculate net energy would be completely impractical.

But second, look at this from the peak oil skeptic perspective. Skeptics have long predicted that as oil became scarce and prices rose, we'd see several effects. One is moderation of demand, which is coming into play now. The second is increased production of conventional oil, which may or may not be happening. And the third is increased production of alternatives, which is definitely going on, with tar sands, coal to liquid, work on biodiesel, and of course ethanol.

All these are the reasons why skeptics said that the core predictions of extreme peak oilers, of social and economic collapse, "die off", all these apocalyptic scenarios, were false. Skeptics predicted that society would adapt and find alternatives. And this is reflected in the issue you raise. As we continue to develop alternative liquid fuels, a higher precentage of our total production will be in this form. If skeptics are right, this will allow us to smoothly adjust to the decreased availability of conventional oil by finding ever more efficient ways of producing these alternatives. The magic of the market will do its work and we can sail right through the classical Hubbert peak without even noticing it.

Yes, but there is strong evidence that the total liquids supply (2005-2006) will never be exceeded, no matter what alternatives are developed. Civilization is not going to end, just some aspects of it (suburbia).
I would say the evidence is pretty weak. We don't even have good evidence that crude has peaked, and aspo thinks this won't happen until 2010. And, regardless of hydrocarbon inputs, ethanol and biodiesel are in their infancy and are obviously surging. Meanwhile, ctl and gtl is beginning, lot least in qatar.
otoh, demand continues, especially in asia but here, too. Prices seem unlikely to decline much in the near future.
Actually ASPO predicts that regular oil peaked last year (2005) but including heavy (I assume that includes tar sands), deepwater, polar and NGL takes it out to 2010.

Which measure equates to crude? Neither... Crude is probably regular plus deepwater and polar - which wouldn't be anything like as late as 2010.

An interesting debate we are not having is whether suburbia must end or not.  While it seems clear that suburbia cannot survive using the current technology, it is much less clear whether it is cheaper (measured using either money or energy) to replace suburbia with something else, or to change suburban technology.  In the US, the current population breakdown is roughly 50/25/25 for suburban, urban and rural; getting rid of suburbia requires replacing 50% of the housing stock, an enormous undertaking by either measure.  I personally suspect that it will turn out that converting the suburbs to run on electricity, improving efficiency to the necessary degree, and generating the needed amounts of electricity, will be the more successful approach.
getting rid of suburbia requires replacing 50% of the housing stock, an enormous undertaking by either measure.

No, it doesn't.  My bet is that what will happen is people will crowd together.  It's only very recently that the 2,000 or 3,000 or 5,000 SF home has become the standard for a family of three or four.  My parents had 4-5 siblings, and grew up in two or three bedroom houses.  With one bathroom.  Amazing but true.  

When people have lost their jobs or can't afford gasoline to drive to work, the last thing they are going to be doing is buying new homes.  No, instead they will be moving in with friends or relatives.  The extended family living together in a fairly small house used to be the norm.  It will be again.  

Already, people in my office with long commutes are hinting about renting the spare room in my small apartment.  (I live walking distance from the office.)  

The half-million dollar exurban house across from my sister's sat on the market for quite a while. Now there are three families living there. They all have fancy vehicles, and over Memorial Day we saw that all their friends do, too.

The inner burbs must increase in density for those that rely on feet, bikes or public transport. Zoning and codes are obstacles to density, but they can be adjusted - formally or informally. I'm wondering about infilling between houses. I used to draw townhouses, and the site planners always left addresses for the spaces between row house blocks. I couldn't imagine anyone filling in back then, but I can now.

I'm also wondering which buildings will be adapted to serve as local schools for kids too far from the mammoth schools we've been putting up.

I could see the outer suburbs becoming a spacious paradise for those that can still afford to drive that far. Exurban highways might become less-traveled and convenient for long commutes, but maintaining them will be expensive. Alan would want money for urban rail while Mr. Big would want the highways kept smooth for his Rolls-Skoda.

I've often thought how absurd it is in the historical context for me, my sister and my parents to all live in the same city and yet not live together. If everything fell apart for my family's finances, we would simply all move "home" back in with my parents. It would be quite an adjustment, but we would save tons of money and energy.

I suspect that many of the empty nesters will see their kids coming home out of necessity. This will boost communal meals, carpooling, per capita heating/lighting efficiency, etc. That is another way of demand destruction. It's very common in Europe to have kids staying at home until they get married or well into their 30s.

The single person household will be one of the first causalties of PO.

The single household is the biggest waste of resources out there.  Rather than have one TV, you have to have 3-4 TVs (depending on family size).  Everything else is duplicated the same way.  I believe that people will cluster back together in the future, but not just because of peak oil, also because of the economic impact of globalization.  
Hmm the family as the "ultimate communal" living arrangement?  Just like the hispanics locally.  We cannot build an entirly new society.  We will be stuffing more people into those houses in the future- take that to the bank per se.  This is just mass-transit-poorer american housing style- more people to share the bills with make it affordable and more economical (per person).  To think that we are going to build a whole bunch of stuff is a historically short term American view.  Look at all the other civilizations that exist and convert by recycling old structures into new ones. Look at what poor people do- not the ones on the government dole - economics in action.
My God...perhaps if families were "forced" to live together, they would have to get to know their grandparents, uncles, cousins...what a horrible fate.
Since 1950, the average size of an American home has increased by 140%, yet in the same time period the average size of an American household has decreased by a whole person.  Now, we spend only 16% of our time in the same room with another family member.

Interesting reading material:
http://realestate.msn.com/improve/Article.aspx?cp-documentid=353659
http://www.post-gazette.com/pg/05080/474759.stm
http://www.ci.cambridge.ma.us/~cdd/data/demo/city/hhsize_2000.html

Nice articles...thanks for sharing.
My pleasure.
Not an accurate reflection.  The previous generations in the United States had more children.  This changed around 1900 or so.  Like all other developed countries, US residents have moved toward a declining population, we just keep expanding due to immigrants and their families which still tend to be larger, but after a generation they will follow the same trend.  This is the market at work, on a very large scale.  Whereas having many children used to be an advantage, it simply is too expensive to have many children anymore and is in fact a disadvantage.  

The advent of suburbia is a result of more land (and secondarily resources) available for a smaller number of people.  Granted, US population has still increased overall, but our surplus of land still remains.  

Your concept of the extended family moving in together is reasonable, but I wonder whether you have taken into account the counterbalance that as it gets more expensive to commute long distances, suburban houses will become cheaper, ironically being a great place to live for those who don't have to commute.  We're not just going to tear the suburbs down.  And neither can current urban environments support all of the people living in suburbia (even if they move in with family members, there are limits).  I guess we could live like people in India or something, but I find that to be unlikely.  

I think we'll see a move toward some consolidation.  Suburbs that are an extreme distance away from urban centers will languish and die (I guess those who can afford to live out there will be able to have a massive estate, rather than a small 1/4 acre plot), but those within reasonable distance 20 miles or so, will not.  Greatly we're going to see increases in transportation efficiency.  We can improve our transportation system by a lot and reduce a lot of our use of fossil fuels.  People haven't even really started to move away from gas guzzlers.  We clearly have much room for improvement.  

Will we soon be talking about "peak suburbia?"

Much, if not most, of the new housing in the US is suburban or exurban, but there are already some counter-trends happening around the country. A number of cities, especially along the West Coast and in New York and Chicago, are seeing lots of new high-rise residential towers go up. "Transit villages" are springing up around inner-urban and suburban communities. Some of the mature "Edge Cities", like Hacienda Business Park in the Bay Area and Tyson's Corner in Virginia, are diversifying their land uses beyond just offices to add dense housing, hotels, and the like. Finally, a number of suburbs which have an old-fashioned district are trying to revitalize them by "main street"-type programs. These trends, along with the others people mentioned, could become more pronounced as the oil peak (or the liquid peak) is passed. A traditional virtue of cities, which is to maximize access while minimizing energy and transport costs, may once again shape urban form much more strongly than in the past 50 years or so.

It is true that we have a huge fixed capital investment in suburban buidings and infrastructure, but it is also true that that infrastructure will require huge ongoing investment if it is to stay in a state of good repair. If oil peaks, transportation investments (of whatever is left to invest) could be shifted from highways to reviving rail services, as many of the rail lines still exist. Transit routes could be established, or reestablished, between new nodes.

Buildings, too require reinvestment; Stewart Brand, in his "How Buildings Learn", noted that buildings need a big reinvestment at an age of about 40 years, as roofs, siding, plumbing, and other components wear out. Post-peak, some buildings, expecially the most remote and energy-intensive ones (i.e. offices without operable windows) may no longer be worth the trouble, and abandoned or dismantled to build other buildings. Other single-use buildings may be adapted to new uses, and "grayfields" -- suburban parking lots -- may become the sites of new mixed-use settlements.

Will we soon be talking about "peak suburbia?"

Let's hope so!

A traditional virtue of cities, which is to maximize access while minimizing energy and transport costs, may once again shape urban form much more strongly than in the past 50 years or so.

Let's hope so!!!

 Whether you like surburbia or not there are useful structures and possibly a few house will be removed and the land converted to food  gardens.   In PO why would anyone think that there will be this big bucket-o-money to run off and build utopia.  If I was in the desert SW (USA) well then yes surburbia could  be the future ghost towns of 2200. I get a sense of "suburbia hatred" from so many people,  we all get to make the best of it, what ever that is, and in the future those surbubia tract houses might make clothing, etc.  Who`is to say for sure, why waste a built building?
it's a good bet "suburbia" is going to be redefined, it's unrealistic to say that we can call it now, what that new definition will be.
I would have to expect that many Bedroom Communities that are looked on as Suburbs now, will start to develop more active market centers (ie, food/essentials) again, and will create increasing local jobs in doing so.  As said above, people will likely re-converge and make use of existing housing stock that is convenient to these re-forming Towns.

Flying over southern Jersey, I'm struck by the Cookie-cutter Housing Webs that cover old farm-fields..  There will be some bizarre Ghost Towns, and if the population shrinks (as it must), then the material wealth in these hollowing places will become a new 'Raw Material' for salvaging into later waves of new-home construction.  Miles of Copperwire, Steel Studs, Aluminum Doorframes, Glass, PVC

I have to wonder if the scraps from this great overproduction we've been part of might not allow a smaller population to have a somewhat abundant supply of many necessary resources for the materials we commonly work with.  Will we have to mine for more HardDrives, or are the trillions of used and dead ones going to be reworked into the next ones?

Will there be a new industry in Mining Landfills for all the precious material we looked on as junk over the last 60-80 years?

Saw on National Geographic Channel last night that the Puente Hills landfill (Los Angeles County, California) is making 50 MW of electricity from methane emissions ("enough for 100,000 homes").  At that rate we may not want to break them apart.
This PDF file has much more detail on LA County landfill gas recovery, and is probably better than "I saw on tv ..."
I worked on a video at one such Methane CoGen site in Massachusetts (10yrs back or so).. Yep, it works.  Don't know the efficiencies, but the engineer told me that they water the piles when they need to increase production.
"An interesting debate we are not having is whether suburbia must end or not."

Odd. I would have called it a boring topic that is constantly being discussed - even in posts about Hubbard linearization.

Well, I admit that it's boring in the form that it's usually expressed: "Peak oil means suburbia will die." That's not a debate, that's a prediction that precludes any discussion. And a prediction that, I think, is usually predicated on a whole set of unstated assumptions. It's certainly more interesting if you start from a different perspective: "Under what conditions could suburbia survive?"

Just as one example, the stock answer says you have live close enough to shopping to walk or bike. But outside Denver, where the sun shines and the wind blows, most suburban houses have enough energy available to them if they could capture and store it to run a small, efficient electric vehicle the several miles needed for shopping every couple of days. What technologies make that possible? How soon will they be available? Or you could consider it in reverse. There's lots of energy available on the roof of the Safeway, is it enough to run electric delivery vans to take groceries to the customers who order online?

Another stock answer is that suburban housing requires too much energy for heating and cooling. Ground-source heat pumps are very efficient, are feasible retrofits in the Denver suburbs, and use electricity from any source in place of today's common natural gas heating fuel. Combine that with much better insulation. Is it good enough?

Suppose electrification is possible. Colorado is rich in potential wind and solar resources, has enough coal to meet that augmented electricity demand for decades, and significant uranium and thorium that could run CANDU reactors (thorium needs a bit of seeding); does suburbia survive in Colorado but not in New Jersey? Not to pick on New Jersey in particular, but they seem to have a lot of people and darned few energy resources. Still, is balkanization of the US along energy-rich and energy-poor lines possible?

I fully accept the first point re energy costs of all fuels, but I think that the second part gets to the heart of a significant number of posts.  It is the point that skeptics often miss and it is the concern that any transition takes time.  Yes we have seen a significant growth in ethanol in the US, and might see this providing 10% of what we need.  Similarly we might get about the same from bio-diesel.  Since these can both be generated from relatively small plants at relatively low investment, and little permitting time, that might get up part way to a solution, fairly rapidly.

However for more significant programs, be they oil shale, tar sand, nuclear power, CTL or whatever, there is a very significant lead time required to acquire the funds, get the permits etc etc.  Without the awareness and incentive to initiate and accelerate those programs, there is quite likely to be a period where supply available will fall and there will be considerable pain in the world economy.

I'm glad this is being discussed.

Personally, I think of "peak oil" as conventional oil + condensates. That's it. As the world moves toward substitutes, as it is doing, we are open to all sorts of monkey business regarding "peak liquids". Now, nothing compares with the EROEI of conventional oil. This fueled the creation of industrial civilization. However, in order to define conventional oil, you need to be quite specific, for example, about the API. Is Saudi heavy crude that can't be as easily refined "conventional oil"? Depends on what your agreed upon definition is.

The EROEI of all liquid substitutes, including "extra heavy oil" like that from Orinoco, is worse both in the production & refining. Same with the tar sands and ethanol. It was the cheapness of conventional oil that made all this "progress" possible. Everything else (eg. GTL, other examples already mentioned) is more expensive. So the substitutes all have a lower payback.

Probably, TOD should track both. But even with all this miracle technology (ethanol, GTL, tar sands, etc.), what is truly impressive is that we seem to have peaked anyway even with these substitutes added in. OGJ raised Canada's proved reserves to 180 Gb.

Early in 2003, the Oil and Gas Journal increased its estimate of the size of Canada's oil reserves from 4.9 billion barrels to 180 billion. As a result, Canada now has the second-largest oil reserves in the world, ahead of Iraq, and OPEC's share of the world's oil reserves has fallen by more than 10 percent.

The explanation for this sudden, massive rise was that the journal had included Alberta's vast tar sands as part of the reserves for the first time. In order for an oil resource to be termed a reserve, it must be possible to extract oil profitably with existing technologies and under present economic conditions. "The tar sands had been economic for some time" Colin Campbell commented. "The change in reporting practice was probably made for a political reason - perhaps to undermine OPEC." The U.S. Geological Survey estimates that by 2005, 10 percent of North America's oil production will come from Alberta's sands.

Source here. Like I said, all sorts of monkey business is possible with liquids accounting practices. But monthly production figures don't lie even when you throw in ethanol & the kitchen sink.

Nice article, lastsasquatch.

"nothing compares with the EROEI of conventional oil"

As I understand it, wind generated electricity has an E-ROI of 80:1.  That's certainly in the ballpark with oil.

Thin-film solar is probably in the neighborhood of 20:1, and is likely to improve.

I'm not saying that there will be a painless transition to renewables.  Wind and solar will be a big, big project to implement.  The US, and others, could certainly have a hard time borrowing enough money to get through the transition, among other problems.

But, there's no theoretical, technical basis for pessimism.  No limits dictated by the laws of physics.  Just the social difficulty of re-engineering our society.

f skeptics are right, this will allow us to smoothly adjust to the decreased availability of conventional oil by finding ever more efficient ways of producing these alternatives. The magic of the market will do its work and we can sail right through the classical Hubbert peak without even noticing it.

Probably not.  The logistic peaks for alternatives are going to look a lot worse than a Hubbert curve.  Alternatives, be it CTL, ethanol, etc, take more investment, take longer construction times, and the equipment does not last any where near as long as a simple hole in the ground does.  You're going to have logistic curves for anything; and they will be on a lot shorter time scale than decades.  At some point all your effort is going to be in keeping your existing capacity running; there will be nothing extra available for additional.  Market magic or not.

These are excellent points that can't be overlooked. Like Michael Lynch does.
Michael Lynch over look anything?! Hah! Muhahah!

Michael Lynch is a thoroughly self-critical guy. I think that beard is a testament to his ability to be introspective while an effective trumpeter of truth.

Nothing coming out of a hole in the ground goes directly into your car.

Ethanol, particularly if built as part of an existing sugar refinery, takes less investment and has a much, much shorter construction time than the equipment required to produce gasoline.  In the time it would take to just get a permit for an oil refinery, you could probably build an ethanol plant.

Depends on the plants.  A refinery for light sweet crude consists of little more than a fractionating column.  A comparison of that refinery to the same size ethanol plant using sugar (say about 100,000 bbl/day) the refinery will actually be less expensive.  For operating expenses the ethanol plant will be much worse than the refinery; the killer is that practically everything is wet service.

In some states the refinery will actually be easier to permit too; mainly because of the water discharge for the ethanol plant.  Nimby for either will be the determining factor.

I agree that it depends on the plants. I don't think anyone is building simple refineries with little more than a distillation column anymore.

I'm dubious of corn-based ethanol and can't argue with you in that regard. Building a facility to create ethanol from sugar, particularly at an existing sugar mill, would certainly be a much simpler and quicker process then any oil refinery that someone would actually build. The ones being built near me take one year. I understand that in the case of sugar, there is no water discharge as it is all recycled.

Sorry, I just noticed that you did refer to sugar-based ethanol in your post - not corn.

I haven't seen comparisions of operating costs, but would be surprised to find out that ethanol costs more per gallon than any modern facility refining crude.

I will be able to provide numbers on this in a month or so.

Corn-based with the materials handling costs isn't even close.  Sugar-based ethanol production compared to a heavy sour refinery would certainly look much better, investment-wise.
Sounds about right.
I wonder if there's any chance of using input output tables to estimate the amount of fuel that is being double-counted because it is then used as input in the creation of another liquid fuel?
Note that based on "total liquids," the US, in 2004, was producing 84% of what Saudi Arabia produced.

http://www.eia.doe.gov/emeu/cabs/topworldtables1_2.html

"the magic of the market"

If you believe in magic, Halfin, you will be sorely dissapointed in how this plays out. To take your argument to the extremes, do you think alternatives can magically take over from fossil fuels (eventually) and continue to increase indefinitely? Now tha