[1] http://www.bloomberg.com/news/articles/2014-10-29/while-you-...
[2] http://media.gotraffic.net/images/iQYuKSosjb3U/v16/-1x-1.jpg
The reason solar-power generation will increasingly dominate: it’s a technology, not a fuel. As such, efficiency increases and prices fall as time goes on.
That's true of shale oil extraction as well.
The corresponding chart conflates all natural gas extraction under the "Henry Hub" label, and all crude extraction under "Brent". Meanwhile, it tries to show an exponential price decline in solar by starting the time series for solar energy costs in 2007. What are we meant to be comparing here?
Maybe! But nothing has an infinite lifetime, so while solar is a technology, the actual solar panels that get made aren't, they're a durable good or an asset, depending on your point of view.
Right now, in a lot of ways a solar panel is simply a way to burn a fossil fuel to make more fuel. Since the lifetime isn't infinite you can compute the amplification factor. Depending on how you calculate it might be a factor of a couple up (just based on price) to a couple dozen (joules to joules). But it's not infinite.
http://www.scientificamerican.com/article/solar-cells-prove-...
This finite lifetime and substantial capex is one of the reasons people criticize basically any kind of ocean power; the environment is so harsh that it's hard to do a lot of energy amplification. If your maintenance costs aren't completely trivial then you're opening yourself up to a sensitivity failure. The difference between 2% and 4% per year doesn't seem huge but over 20-30 years is big.
1.02 ^ 30 = 1.8
1.04 ^ 30 = 3.2
That's one of the reasons that people like fossil fuels so much. The amplification factor is huge and it's well known. It might take two weeks to drill a well (on land) and during that time you might use 3000 horsepower continuously (about 2MW). But if you do the math, that's only 672 MWh. A BOE is about 1.7MWh so you only need to produce 400 barrels to get ahead on the well. Add in another couple of thousand for everything else (pumps, piping, etc) and you've still got a very low bar to net energy gain.
http://io9.com/solar-powers-epic-price-drop-visualized-51044...
What we're meant to be comparing -- and I don't think that chart mean to lump all lng or all oil in together -- is that solar is now comparable to oil and/or lng in certain locations.
Oh, and I don't think anyone anticipates efficiency gains in shale oil extraction comparable to the ongoing efficiency increases in anything silicon related.
If you're arguing that the price of shale-oil extraction can and will only fall, you're almost certainly in error.
Yes, there's some room for improvement in any technical process, initially, but in virtually all (IT and IC design specifically being the notable exception), diminishing returns set in.
For oil, the challenges are twofold.
One is accessing ever more difficult to extract resources -- further offshore, more remote, tighter shale, etc. US EIA's own estimates call for a peak in US shale / tight-oil extraction likely before 2020. http://www.eia.gov/pressroom/presentations/sieminski_0521201... (p. 11, "reference case")
Per-well extraction rates fall off tremendously in 18-24 months, and constant new exploration and drilling (both expensive) are required. Contrast with First Oil Well, Bahrain, completed in 1931, and still providing 35,000 bbl/day nearly 85 years later: https://en.wikipedia.org/wiki/First_Oil_Well,_Bahrain
They don't make 'em like they used to.
The other is the increasing likelihood that fossil carbon assets will be stranded -- prohibited from access until climate and environmental impacts are addressed. Almost certainly a process of a century or centuries.
Solar costs (direct PV) have been falling consistently, though other associated costs (labour, installation, structures, inverters, interconnects) haven't declined as much. The relatively fixed costs then become a larger
Lucky for us, the markets are made up entirely of perfectly-informed, perfectly-rational, perfectly-self-interested frictionless spherical humanoids in uniform harmonic motion.
One would hope so. The efficient market hypothesis may not be 100% true, but I'd be surprised if it were that far from true.
The world is really on the way of getting rid of oil.
Electric cars, bioplastics, solar panels getting exponentially cheap.
From my point of view the only thing that stops us all from switching to electric cars is the battery technology.
When it comes to the industrial use of solar energy, we already have the technology of storing energy - flywheel (google Beacon Power).
Solar is following an exponential fall, but the tail has long been wagged
http://io9.com/solar-powers-epic-price-drop-visualized-51044...
* They're unreliable.
* The intermittency makes it impossible to use.
* It's unfair on the monopolistic power companies.
We can do the battery storage right now, it's just not as great as what we'd like.
If you switched all cars over to electric tomorrow, the grid would melt down in every country that attempted it. There is not even remotely enough power available to handle it. Most first world countries are running their national power grids with a very modest buffer (and for countries sub first world, forget about it, they're still dealing with routine rolling blackouts).
By the time all autos are switched to electric in 30 years, hopefully self-driving cars have wiped out at least half of all vehicles in the first world.
"From my point of view the only thing that stops us all from switching to electric cars is the battery technology."
My obvious point was that, in fact, that is not even remotely the only thing stopping us from switching to electric cars. My scenario was extremely useful in highlighting the fact that we do not have the capacity to switch to an all-electric car approach, and not primarily due to batteries.
We can do the battery tech and manufacturing in the present, to build very effective electric vehicles. Building up the grid to support ~500 million cars in the first world would cost tens of trillions of dollars and take decades. It makes the battery challenge look hilariously minuscule by comparison.
"By the time all autos are switched to electric in 30 years"
You ignored what I said, and proceeded to tell me how the shift will take decades.
Batteries are not a $30 trillion and 30 year problem, not even remotely close. Batteries are an order of a magnitude smaller of a problem.
We can build the Tesla S already. Musk is going to spend $5 billion building a plant that can produce 500,000+ car battery systems. We can already make effective battery systems for mainstream electric cars, the challenge now is to make them better and scale up manufacturing (which has already begun).
It costs $5 billion in the US just to build one major nuclear power plant.
I rarely see anybody discussing where the trillions of dollars in new spending is going to come from to boost energy supply and grid to handle 100 million electric cars in the US. It'll cost trillions just to maintain what we already have now over that time.
As for where the money comes from, doesn't that just fall out of supply and demand? As demand for electricity increases, prices will go up, funding the infrastructure improvements needed to accommodate the increased demand.
The solution may not even lie in the grid. Batteries can solve the grid problem as well as the battery problem. Give every electric car customer enough solar to cover his charging needs and a fixed storage installation to keep the power for when the car comes home, and the grid won't even know the cars are there.
I'm sure this will all be wonderfully challenging for those involved, but it doesn't look like something to worry about from the outside.
Looking forward to oil-shareholders claiming how expensive electric cars for the elites are making electricity unaffordable for the poor.
The vast majority of people don't buy a brand new car more than once or twice in their life. They simply don't have the money. The rest of the people buy a car used and drive it until they sell it to someone else to buy another used car. Cars can last 200+k miles which is often 15-20 years in the life of most vehicles.
The adage has been that "Americans buy, on average, a new car or truck every 3 or 4 years."[1] That's like a dozen new cars in a lifetime.
I was going to call bravo sierra on your assertion, but I decided to try a back-of-the-envelope calculation to check the plausibility:
Roughly 10 million cars are sold each year in the U.S., the U.S. has 230 million adults, and they'd likely buy their cars between ages 18 and 65 (a span of 47 years). That means each adult has a 1 in 23 chance (230M/10M) of buying a new car each year, so over a 47-year span they'd buy 47/23 = 2 new cars.
There could be all sorts of ways my calculation could be wrong, but it agrees surprisingly well with your claim.
I'm wondering now if the "new car every 3-4 years" is a myth propagated by auto makers.
Without doing a lot of research, I couldn't decide how to deal with questions of:
- Including or excluding light trucks
- Including or excluding cars that are new but being leased rather than sold
- Large year-to-year variations in sales (esp. of low sales during the recession)
But I think 10 million is reasonable rough estimate.
[1] http://en.wikipedia.org/wiki/Passenger_vehicles_in_the_Unite... [2] http://online.wsj.com/mdc/public/page/2_3022-autosales.html
http://usatoday30.usatoday.com/money/autos/story/2012-01-17/...
33.8% of cars were older than 10 years as of 2001: https://en.wikipedia.org/wiki/Passenger_vehicles_in_the_Unit... http://www.nada.org/Content/NavigationMenu/MediaCenter/NADAD...
If you run the statistics as median number of lifetime purchases by person (rather than average), you'll likely get a lower count as well. High-volume purchasing is likely concentrated among wealthy (or exceptionally unlucky) drivers.
I think the numbers are heavily skewed by people who do buy those new cars every few years.
Also, I think the car rental companies - who would have massive annual turnover of vehicles - further skews the average[1]. The top 4 companies have ~2M vehicles and if they never have a car more than 3 years old (probably more like 2 years), then they buy ~700k/year or 7% of that 10M in annual new car sales.
1 - http://www.fool.com/investing/general/2012/07/13/surprising-...