The Oil Drum

Dear Peak Oil Tarzan;

I am intimidated by your moniker, but here is a link: http://www.ers.usda.gov/Data/AgProductivity/

It shows farm output per input rising about three times since 1948.

I do not know how the USDA calculates everything. But, it makes sense. Farming is a form of manufacturing, and output per worker and unit of energy has been rising for decades as well in manufacturing.

In all, this is good news. We can expect farm output per input to rise for many decades hence, if the past six decades are a clue. This is especially good for ethanol and biofuels, which I contend is still an infant industry.

We have been growing jatropha for oil just a few years. Algae still just a hope, not a reality. Corn ethanol output only got serious in last two years – and only now are the new generation ethanol plants being brought on line which promise 5-1 positive energy returns.

It is reasonable to hope that, even with the so-so crop of corn, we can acheive very high single-digit ernergy returns in 10-20 years (7 to 1 , or 8 to 1).

As crop yields are rising 2 percent a year, and if PHEVs come on, this may move us huge steps to a post-fossil economy, long before we run out of oil. I think we can acheive Peak Demand for fossil oil a good 10-20 years before Peak Oil.

Last year, world crude demand grew by only 0.9 percent, after growing 3.1 percent in 2004, and then 1.8 percent in 2005. Check with EIA, these are hard stats.

One more year like the previous three, and we are at Peak Demand.

It may be game over for the fossil boys, any day soon.

The problem is, crude prices may collapse, wiping out the alternative fuel industry for another 20 years.