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example.com0 points · 0 comments · 11 years ago · beefman
The price of energy matters too, not just its derivative. We can make synthetic fuels that existing infrastructure can use but they're too expensive to support our civilization.[2]
Imagine your robot vacuum can run an hour on a charge and takes 15min to make a roundtrip to its charging station. If you move the charging station so the roundtrip takes 30min, you'll get dirty floors, and they'll still be dirty a year later. The robot's EROI has gone from 4 to 2 and it can only handle a smaller house, or one that sees less activity.
The EROI of a commodity like oil is approximately inversely proportional to its price. For commodities, competition brings price to the marginal cost of production, which is the cost of the embodied energy (so for fuels, this cost is unitless). The synthetic fuels are expensive because their synthesis is energy-intensive.
It's something policy makers should understand when they advertise energy projects as creating jobs. Manifestly, the more jobs an energy source requires, the worse it is. Energy is a means to an end not an end in itself.
AlexDanger
spikels
Instead persistent high oil prices and new technology have made previously uneconomic oil sources economically viable.
No. In the case of oil, there's low elasticity of substitution. Trillions of dollars of infrastructure run on oil, not alternative fuels.
Is this elasticity of substitution quantified? I'd like to read more about it if you have a link. My gut feeling is that this elasticity is improving (despite increasing oil consumption) due to general technological advancement and a high-speed globalised economy.
How well can we respond to a price spike now versus 30 years ago? Can we mitigate the economic impact of a price spike faster than we could 30 years ago? These are the trends I am interested in investigating.