Thursday, 15 February 2007

Living in a state of exponential delusion

Simon Ratcliffe, an energy and sustainability consultant and chairman of the Association for the Study of Peak Oil SA, recently wrote an article that succintly exposes the fallacy of sustainable growth

"... Exponential growth refers to a situation where there is constant growth. It doesn’t matter what the rate of growth is, only that it is constant. For example, our current economic strategy is aimed at achieving 6% growth over a sustained period of time. What 6% growth means is that we will be doubling the size of our economy in roughly the next 11 years.

Yes, at this rate of growth we will double our gross domestic product, which means we will double what we produce. In order to double what we produce, we will need to double what goes into what we produce.

This includes raw materials and crucially, energy. So, roughly speaking, in the next 11 years we are going to need to double the amount of energy we are currently consuming.

How did I work this out? As I said, it is a matter of simple mathematics. Every junior financial adviser knows the Rule of 70. To calculate the doubling time of anything that is growing at a constant rate, divide 70 by that rate of growth. This basic calculation is used constantly with respect to calculating financial returns, but rarely to calculating the rate at which we are depleting resources...

Let’s understand this in a little more depth. Each doubling cycle — 11 years, in our case, at 6% growth — is greater than the sum of all previous doubling cycles combined. This means that in the next 11 years, we will consume more than we have in our entire history. Every time we double, that is, when we go from one to two, from two to four, from four to eight, from eight to 16, and so forth, the last doubling cycle is greater than the sum of all the previous cycles — 16 is greater than 8+4+2+1, which is equal to 15. This is a mathematical law that is rarely understood, particularly by economists, who often assume resources are infinite...

Let’s look a little further afield. China and India are both growing at a rate of about 10% per year. So, their economies are doubling every seven years. Some might argue that this is growth off a low base, but each of these countries has a population of more than 1-billion people, so absolutely their consumption is enormous, even if per capita it is less than ours right now. Both of them will in the next seven years consume more than they have during their entire histories. Is it any wonder that most of the world’s steel, coal, cement and other critical resource are on ships heading east?

Which brings me to the obvious rhetorical question: for how long can this be sustained? I haven’t done any research into world steel resources, and production, nor have I done any research into the same for cement, but I have done a lot of research into world oil reserves and oil production. One thing is crystal clear: we are going to have to face up to oil production reaching its peak within a few years, and also the dramatic way in which this is going to affect all of our lives. Oil is deeply embedded in just about everything we take for granted...

Very soon we are going to have to face up to the very short life of globalisation. The inevitable decline in oil production will bring with it restricted mobility, and a far more localised way of living. Work, schools, social services, medical care will all need to be close to where we live. Sustainable neighbourhoods are going to need to be connected with good, reliable public transport. We need to begin planning at every level of government, in every sector of the economy, in every town and in every village for this. It is not a matter of if, it is a matter of when..."

See also
Dr. Albert Bartlett: Arithmetic, Population and Energy

Sharon Astyk: Casaubons Book
Enough with the Freakin' Bathroom Metaphor Already!

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