Tuesday, October 6, 2009

The Impending Oil Shock (Continued)

Responding to the crisis
In the face of growing resource scarcity oil importers must seek to minimise the cost of their imports and the leverage energy exporters enjoy over them. Governments must see that they do not fall behind other nations in maximising their energy efficiency and developing alternative energy sources. It is also in the interest of most nations to minimise the disruption resulting from conflicts over resources (sometimes, but not always, at the margins of the global economy); the dangers of an enlarged dependence on nuclear power; and the threat to international order posed by additional state failures.

In the global struggle to respond to the oil crisis traditional military means will have some uses. When a genuine threat appears to resources on which states depend- whether for foreign earnings or to keep vital infrastructure running-they will find it in their interest to at least have the option of military action. Situations of conventional conflict between sizeable military forces are likely to remain rare, however, as today's resource conflicts tend to take the shape of civil wars (in which outside countries are, to be sure, likely to intervene), and there is little reason to expect this to change. It is more likely that the major militaries will be called on to perform missions 'other than war,' such as peacekeeping, as a result of the tightening of the world's oil supply, and greater alertness and enlarged capabilities in these areas (which, at any rate, are only partly military) would be desirable.

In the end, then, a nation's ability to sustain its economy and preserve its influence will depend less on military capability and more on an ability to insulate its economy from oil shocks: in short, on its success in reducing its reliance on fossil fuels sooner rather than later. The question all nations must confront is how to effect a speedy change.

The experience of the United States since the 1980s, especially when compared to that of Europe and Japan (which have had much greater success at de-linking their economic growth from expanded fossil-fuel use), demonstrates the practical limitations of a 'market-led' approach. Such a project would preferably be undertaken before the tightening of supplies becomes so serious that the market finally forces consumers to make a change, not only in the interest of minimising the difficulties of the transition, but because such a moment would be an especially poor starting point for such an ambitious programme.94

The high profits energy companies (already given to a short-term, low research and development outlook) will make from scarce, expensive oil, and the likelihood that depressed economic circumstances will discourage investment and exacerbate conflicts over priorities, will complicate efforts to reconstitute an energy base. Neoliberals, confident in the market's penchant for creative destruction and its ability to deliver 'disruptive technologies' like renewable energy, offer information and communications technologies as examples of how innovations previously overcame such resistance.95 But other technologies, especially capital- and infrastructure-intensive technologies like energy production, tend to proliferate much less rapidly. Additionally, even in the case of mobile phones a stable regulatory framework-the Global System for Mobile communications established by the EU-was key to rapid proliferation. Replacing the fossil-fuel economy will be far more complex than putting a mobile phone in each hand.

As with other national priorities, governments must set energy targets, and make active efforts to meet those targets. They must encourage energy conservation and energy production from alternative sources, to include unconventional oil and possibly nuclear power in the portfolio in the near term, but with renewable energy production the first choice. Unfortunately, with the exception of hydroelectric energy, which is a major energy source, there has been a tendency to dismiss renewable sources, or defer their use to an indeterminate 'future' date in which they have been made economically viable by 'more research.' Such rhetoric is often a way of avoiding present action. It also implies that renewable energy sources are too expensive, too difficult to scale up or too dependent on a fossil-fuel platform to represent even a partial solution today.

The evidence contradicts such assertions. 'Cheap' oil is only deceptively so. Subsidies aside, the per-barrel price of oil represents the externalisation of much of its cost, as the price of health problems caused by air pollution from the burning of oil, the clean-up of ecological damage caused by pipeline leaks and tanker spills, and, of course, the consequences of climate change, appears elsewhere.96 Additionally, the price of oil seems to be set on an upward trajectory, measured both in dollars and cents and in the energy that must be invested to get each additional barrel.

Similarly, the arguments against the scalability of renewable energy production frequently prove to be of the 'straw man' type upon close examination. It is not necessary for a single type of energy production to satisfy 100% of the needs of a nation's economy, any more than this is expected of coal, oil, gas or nuclear energy now; instead a mix of sources is currently utilized, and likely to go on being utilized even as that mix changes. Moreover, wind turbines have already been successfully used to supply industrialised nations with as much as a quarter of their electricity. Innovations such as windmills based on floating platforms, and (rather more experimental) 'flying windmills,' may ultimately revolutionise the field.97 Solar energy is more expensive, but more efficient in land use and more easily installed because, rather than requiring tall towers, any rooftop will do. This form of energy may be particularly helpful when incorporated into energy-efficient buildings, which can become net energy producers.98 Tidal energy, scarcely exploited because of high capital costs, also promises high returns.

While large-scale, high-return energy production from renewable sources is feasible, the fact does not by itself resolve the problems raised by shortfalls in fossil fuel supplies. Transport in particular remains problematic-the reason why France's investment in nuclear energy has reduced its coal and natural gas use much more than its petroleum consumption. In the short term, there are numerous ways to maximise the efficient use of oil in the world's transportation system, and every barrel of oil, conventional or unconventional (e.g. the coal and natural gas from which oil can be extracted), not used to support electricity production is freed up for other uses.99 Over the longer term, however, much will depend on the degree to which vehicles like buses, cars and trains shift to electric power; and the ability to translate electrical generation from renewables into gaseous fuels like hydrogen and ethanol, the large-scale economies of which remain unproven.100 Additionally, modern agriculture and industry depend on oil-based plastics, pharmaceuticals and fertiliser, and while they are relatively minor consumers of petroleum, there are no obvious substitutes for many of these.

Achieving a combination of energy conservation and expanded energy production from non-fossil-fuel sources will bring demand closer in line with the sustainable supply.101 However, this goal is unlikely to be achieved without significant state inputs. The contribution of public money to research and development efforts would be a necessary part, but is not the only role that government can play. Other actions could include setting high fuel-efficiency standards for vehicle fleets; requiring utility companies to produce set portions of their total energy output from alternatives; purchasing energy from renewable sources whenever possible; and offering assorted subsidies, such as tax breaks and loans, to defray the costs of the changeover to consumers.102

Efforts in this area have so far been piecemeal, with modest goals: a common target across the industrialised world is to attain a double-digit percentage of energy needs from renewable sources by 2010 or 2020, much of that to come from long-established hydroelectric power. Nonetheless, there are signs that governments are beginning to consider more ambitious and comprehensive plans. Last year, for instance, the Swedish government announced a plan to end Sweden's dependence on fossil fuels by 2020.103

Accomplishing this in 15 years may seem over ambitious, and not every country enjoys Sweden's combination of affluence and geography. Nonetheless, that time frame is an accurate reflection of both the problem's severity and the availability of practical tools for coping with it, and is a model for other states following the same course, ideally in cooperation with one another. As with climate change, the impending oil shock is too complex for any nation to fully address on its own. The global integration of the economy, the fact that every country draws on a common pool of oil, and the particular difficulties facing underdeveloped states, make carefully considered collaboration on the planetary level the only way forward.

Notes
1 The seminal paper on the subject is M. King Hubbert's 'Nuclear Energy and the Fossil Fuels,' Publication no. 95, Shell Development Company, June 1956. Also see Kenneth S. Deffeyes, Hubbert's Peak: The Impending World Oil Shortage (Princeton, NJ: Princeton University Press, 2001).

2 See James Howard Kunstler, The Long Emergency: Surviving the Converging Catastrophes of the Twenty-First Century (New York: Atlantic Monthly Press, 2005).

3 Leonardo Magueri, 'Two Cheers For Expensive Oil,' Foreign Affairs, vol. 85, no. 2, March–April 2006, p. 150.

4 Ibid., p. 150.

5 This would be 50% of an estimated world supply of 6tr barrels of oil. Other estimates are rather more conservative, assuming that only 30% might be recoverable – a difference of over a trillion barrels. See John H. Wood, Gary R. Long and David F. Morehouse, 'Long-Term World Oil Supply Scenarios: The Future is Neither as Bleak or Rosy as Some Assert,' 18 August 2004, http://www.eia.doe.gov/pub/oil_gas/petroleum/feature_articles/2004/worldoilsupply/
oilsupply04.html.

6 Annual oil consumption is today in the area of 30bn barrels a year. See Central Intelligence Agency, CIA World Factbook 2006, https://www.cia.gov/cia/publications/factbook/index.html.

7 Colin J. Campbell and Jean H. Laherrere, 'The End of Cheap Oil,' Scientific American, March 1998, pp. 78–84.

8 As Matthew Simmons has noted, Saudi Arabia's reserves have been set at 260bn barrels for nearly two decades, despite the production of nearly 50bn barrels. Matthew Simmons, Twilight in the Desert: The Coming Saudi Oil Shock and The World Economy (Hoboken, NJ: John Wiley & Sons, 2005). Optimists claim, by contrast, that the 260bn figure is low: Magueri, for instance, asserts that it is just a third of Saudi Arabia's actual oil reserves. Magueri, 'Two Cheers,' p. 153.

9 Campbell, 'The End,' pp. 79–80.

10 Daniel Yergin, 'Ensuring Energy Security,' Foreign Affairs, vol. 85, no. 2, March–April 2006, p. 74.

11 Leonardo Magueri, 'Never Cry Wolf – Why The Petroleum Age Is Far From Over,' Science, no. 304, 21 May 2004, pp. 1114–15.

12 Deffeyes, Hubbert's Peak, p. 10.

13 Magueri, 'Two Cheers,' p. 151.

14 See Thomas Homer-Dixon, The Upside of Down: Catastrophe, Creativity and teh Renewal of Civilization (Washington DC, Island Press, 2006).

15 This is a matter of some controversy. 'Oil optimists' contend that while this may be the case with North America, the territory of some major producers like Russia and the Middle East may be under-explored, and they point to the smaller number of exploratory wells drilled inside these territories. Magueri, 'Two Cheers,' pp. 150–1.

16 Colin Campbell's widely publicised estimate is that there may be a total of a trillion barrels remaining to be recovered, just one-third of the USGS estimate, so that roughly half the world's supply has already been used up, rather than a quarter or so in the USGS estimate. Campbell, 'The End,' p. 81.

17 This can be explained to some degree by OPEC's deliberate production cutbacks, which did not figure into Hubbert's calculations.

18 Over 80% of production comes from fields found before 1973. Campbell, 'The End,' p. 80.

19 Simmons, pp. 134–48. Water injection can cause such problems as the corrosion of the extraction equipment, and the biodegradation of the oil by bacteria in the water. Simmons, pp. 103–4.

20 John Dillin, 'How Soon Will World Oil Supplies Peak?,' Christian Science Monitor, 9 November 2005, p. 3.

21 Some studies set the date much later than that, one putting the outside figure early in the twenty-second century-though this study judged the US Geological Survey to be conservative in its estimates, and assumed field growth outside the United States. See Wood, 'Long-Term.'

22 The 6%-a-year drop may at first seem surprising, since according to peak theory, the production of oil drops at approximately the rate at which it rose. However, the use of more aggressive recovery techniques to stave off the peak is likely to mean an even more rapid drop when the peak finally does hit, given that well over 50% of the supply will have been depleted by then.

23 Brendan I. Koerner, 'The Trillion-Barrel Tar Pit,' Wired, vol. 12, no. 7, July 2004, http://www.wired.com/wired/archive/12.07/oil.html.

24 Wills H. Miller, 'Pacific Coast Oil and Natural Gas,' Economic Geography, vol. 12, no. 1, January 1936, pp. 86–90.

25 Dan Wyonillowicz, Chris Severson-Baker and Marlo Raynolds, Oil Sands Fever: The Environmental Implications of Canada's Oil Rush (Drayton Valley, AB: The Pembina Institute, 2005), pp. 15–6. Using the current procedure, 30 cubic metres of natural gas are used to extract each barrel of oil. Recovering the world's supply of heavy oil would thus use up the planet's entire proven natural gas supply, even if it were set aside solely for this purpose.

26 Central Information Agency, 'World,' CIA World Factbook 2006, https://www.cia.gov/cia/publications/factbook/geos/xx.html#Econ. There are those who argue that proven natural gas reserves may be only a fraction of the possible total, and that there are also 'unconventional' natural gas sources, such as coalbed methane. Natural Gas Supply Association, 'Unconventional Natural Gas Resources,' NaturalGas.org, http://www.naturalgas.org/overview/unconvent_ng_resource.asp.

27 Energy Information Administration, 'World Coal Markets,' International Energy Outlook 2006, http://www.eia.doe.gov/oiaf/ieo/coal.html. As with oil, the standard estimate has been attacked (most recently, by a report of the National Academy of Sciences) as being over-optimistic about the recoverability of known coal supplies. Matthew L. Wald, 'Science panel disputes estimates of coal supply,' International Herald Tribune, 21 June 2007, http://www.iht.com/articles/2007/06/21/business/coal.php.

28 Jeff Goodell, Big Coal: The Dirty Secret Behind America's Energy Future (Boston, MA: Houghton & Mifflin Co., 2006), p. 205.

29 EIA, 'World Coal Markets.'

30 Gregson Vaux, 'The Peak in US Coal Production,' From The Wilderness.com, http://www.fromthewilderness.com/free/ww3/052504_coal_peak.html.

31 Energy Information Administration, 'World Oil Markets,' International Energy Outlook 2006, http://www.eia.doe.gov/oiaf/ieo/oil.html.

32 Energy Information Administration, International Energy Outlook 2007, http://www.eia.doe.gov/oiaf/ieo/pdf/oil.pdf.

33 Russia's oil sector provides 25% of the country's GDP – and just 1% of employment. US Department of Energy, 'Russia,' Country Analysis Briefs, May 2004, http://www.eia.doe.gov/emeu/cabs/russia.html.

34 Given its massive supplies of unconventional oil, however, Venezuela's staying power in this area may be lengthier than its reserves of oil suggest as they are ordinarily calculated.

35 Substantiating such expectations is the fact that Iran currently produces oil below the level of its OPEC quota, at an estimated cost to its economy of over $5bn a year. Barry Schweid, 'Iran oil revenue quickly drying up, analysts say,' Boston Globe, 26 December 2006, http://www.boston.com/news/world/articles/2006/12/26/iran_oil_revenue_quickly_drying_up_analysts_say/. There is, however, considerable argument over the extent to which this is due not to the exhaustion of its supplies, but simply the country's failure to modernise its fields and explore for oil adequately, with some observers arguing that Iran could in fact rapidly expand its production. EIA, 'Iran Country Analysis Brief,' August 2006, http://www.eia.doe.gov/emeu/cabs/Iran/pdf.pdf.

36 Russia's oil use has tended to be only half as efficient as the United States'; moreover, Russia has used its oil to subsidise its influence abroad, as through sales at below-market prices to former Soviet republics.

37 For a survey of the literature on this subject, see Michael L. Ross, 'The Political Economy of the Resource Curse,' World Politics, vol. 51, no. 2, 1999, pp. 297–322.

38 Philippe Le Billon, Fuelling War: Natural Resources and Armed Conflict, Adelphi Paper 373 (Abingdon: Routledge for the IISS, 2005), p. 82.

39 Anil Markandya and Alina Averchenkova, 'Reforming a Large Resource-Abundant Transition Economy: Russia,' in Richard M. Auty
(ed.), Resource Abundance and Economic Development (New York: Oxford University Press, 2001), pp. 292–3; Le Billon, Fuelling War, p. 12. The declining terms of trade for commodities (not a historical constant, though evident in recent decades) can also be a factor. For a nuanced discussion of the issue, see Paul Bairoch, Economics and World History: Myths and Paradoxes (Chicago, IL: University of Chicago Press, 1993).

40 Terry Lynn Karl, The Paradox of Plenty: Oil Booms and Petro-States (Berkeley, CA: University of California Press, 1997), pp. 44–67.

41 Le Billon, Fuelling War, p. 17.

42 Richard M. Auty, 'A Growth Collapse With High Rent Point Resources: Saudi Arabia,' in Auty (ed.), Resource Abundance, pp. 205–6.

43 Fuel-efficiency standards for cars are a case in point. American car mileage flatlined in the area of 25–30 miles per gallon following the price drop, with manufacturers and consumers alike opting for large, powerful vehicles rather than efficient ones. See Amory B. Lovins and L. Hunter Lovins, 'Mobilizing Energy Solutions,' American Prospect, 28 January 2002, pp. 18–25.

44 'Georgia In Talks With Russia's Gazprom after More Than Doubling of Price for Gas,' International Herald Tribune, 3 November 2006, http://www.iht.com/articles/ap/2006/11/03/business/EU_FIN_Georgia_Russia.php.

45 Edward Luttwak, 'The Truth About Global Oil Supply,' The First Post, http://www.thefirstpost.co.uk/index.php?menuID=1&subID=18.

46 The figures for every dollar of GDP as of 2004 were 9,300 Btus (British thermal units) for the US; 7,200 for France; 6,500 for Japan; and 6,200 for the UK. Calculated using data from: Energy Information Administration, 'World Energy Intensity – Total Primary Energy Consumption per Dollar of Gross Domestic Product Using Purchasing Power Parities, 1980–2004,' International Total Primary Energy Consumption And Intensity, 23 August 2006, http://www.eia.doe.gov/emeu/international/energyproduction.html. Considered in terms of electricity, the US gets $3.40 of GDP to the kilowatt-hour, compared with $4.20 for France, $4.25 for Japan, $5.00 for Germany and a remarkable $5.30 for the UK. Calculated from national data in CIA World Factbook 2006.

47 Calculated from national data in CIA World Factbook 2006.

48 The United States and the United Kingdom get roughly $19.50 of GDP for every cubic metre of natural gas consumed, but Germany gets $26.70, France $41.50 and Japan $46.50. Ibid. The US gets $10,700 to the (short) ton of coal, which puts it slightly ahead of Germany (which in this case fares poorly with just $9,900 to the ton), but Japan gets $26,700, the UK $32,000, and France a staggering $100,000 to the ton. Calculated from US Department of Energy statistics, http://www.eia.doe.gov/.

49 Because coal and gas are used principally for electrical generation, nuclear energy more readily substitutes for these fuels than for oil.

50 Ricardo Bayon, 'The Fuel Subsidy We Need,' The Atlantic Monthly, February 2003, 117–19. Energy efficiency improved by a substantially larger margin in the United States than the other industrial nations discussed here, excepting the United Kingdom. In 2004 the US used approximately 61% of what it did in 1980, compared with 82% for France and 84% for Japan-though it may be argued that this is because the US was so much less efficient to begin with.

51 As a sector, industry makes up 27.8% of Japan's GDP, and 29.6% of Germany's, compared with 20.4% for the US and 19.1% for the UK. CIA World Factbook 2006.

52 If an alternative to the dollar emerges as the currency of the oil trade (as seems possible with the euro), the pressure on the United States would immediately worsen. Of course, domestic energy supplies would alleviate the problem of paying in a foreign currency-though in free-market economies, domestic supplies will not do much to affect world market prices. Additionally, with American oil production in decline and the North Sea set to follow a similar course, the major industrial nations will only be able to meet part of their domestic demand for fossil fuels, unless unconventional oil supplies (which the US possesses in abundance) are counted.

53 The low population density of the United States, while one cause of its inefficient energy use, could also be a boon, given the large land area required by wind- and solar-energy installations.

54 Salvatore Lazzari, 'Energy Tax Policy,' report, Congressional Research Service, 24 August 2001.

55 For two conflicting views of the matter as it stood in the late 1990s, see Douglas Koplow and Aaron Martin, Fueling Global Warming: Federal Subsidies to Oil in the United States (Washington DC: Greenpeace, June 1998); and American Petroleum Institute, 'Fueling Confusion: Deceptive Greenpeace Study Premised
on Flawed Estimates of Subsidy,' November 1999.

56 According to one study, federal support of the oil industry between 1918 and 1980 came to some $268bn (as measured in 1999 dollars). Battelle Report, 'Analysis of Federal Incentives Used to Stimulate Energy Production,' Pacific Northwest Laboratory, February 1980 (Revision no. 2), p. 276. Cited in National Environmental Trust, America, Oil and National Security: What Government Data Really Show (Washington DC: National Environmental Trust, 2002). Some $145bn were also spent on subsidising nuclear energy between 1947 and 1999. Marshall Goldberg, 'Federal Energy Subsidies: Not all Technologies are Created Equal,' Renewable Energy Policy Project, Research Report, July 2000, p. 2.

57 The figures are $20bn for fossil fuels, $40bn for nuclear and $10bn for renewables. Fred J. Sissine, 'Energy Efficiency: A New National Outlook?,' Congressional Research Service Reports, 12 December 1996, http://www.cnie.org/nle/crsreports/energy/eng-28.cfm.

58 While precise figures are hard to establish given that security policy is often determined by a number of factors, the statistics available indicate substantial costs. Michael Klare has calculated that in recent years the United States has spent $150bn annually on safeguarding the oil supplies of the Persian Gulf-$12 for every barrel the region produces, and $100 for every barrel the United States imports from the region. This does not include what Washington spends on energy security outside that area, or the expenditures of other countries. Michael Klare, Blood and Oil, p. 182.

59 See Elhefnawy, 'Toward,' pp. 109–10.

60 Energy Information Administration, 'Wind Power,' Renewable Energy Annual 1996, 16 April 1997, http://www.eia.doe.gov/cneaf/solar.renewables/renewable.energy.annual/chap05.html.

61 Earth Policy Institute, 'Wind Electricity-Generating Capacity by Country and World Total, 1980–2005,' Wind Energy-Data, http://www.earth-policy.org/Indicators/Wind/2006_data.htm#table3.

62 Energy Information Administration, 'U.S. Electric Net Summer Capacity,' Renewable Energy Trends 2004, August 2005, http://www.eia.doe.gov/cneaf/solar.renewables/page/trends/table12.html.

63 Kevin Phillips, American Theocracy: The Peril and Politics of Radical Religion, Oil and Borrowed Money (New York: Viking, 2006).

64 Indeed, recent years have seen the renewal of literature anticipating future European world leadership on this and other grounds. See Jeremy Rifkin, The European Dream: How Europe's Vision of the Future is Quietly Eclipsing the American Dream (New York: Jeremy P. Tarcher, 2004); Mark Leonard, Why Europe Will Run The 21st Century (New York: Public Affairs, 2005).

65 In 1980 China required 23,500 Btus for each dollar of GDP (adjusted for Purchasing Power Parity). This fell to 7,700 in 2002, and was already back over 9,000 by 2004, in roughly the same range as the US. Data from Energy Information Administration, 'World Energy Intensity.'

66 US Department of Energy, 'China,' Country Analysis Briefs, August 2006, http://www.eia.doe.gov/emeu/cabs/China/Profile.html.

67 India used 4,300 Btus to produce every dollar of GDP in 1980, a figure which rose steadily until reaching 5,300 in 1995, after which it dropped back down to 4,200 in 2004-compared with 9,000 for China and the US, and around 6,000 for the UK. Data from Energy Information Administration, 'World Energy Intensity.'

68 Earth Policy Institute, 'Wind Electricity-Generating Capacity.'

69 By contrast, Europe, Japan, and the United States, in part because they are already developed and growing more slowly, can much more readily decouple GDP growth from increased energy use.

70 Michael Klare, Blood and Oil: The Dangers and Consequences of America's Growing Dependency on Imported Petroleum (New York: Henry Holt & Co., 2004), pp. 161–79.

71 Thomas Homer-Dixon, Environmental Scarcity and Global Security (Ithaca, NY: Foreign Policy Association, 1993), pp. 67–8.

72 Russell Clemings, Mirage: The False Promise of Desert Agriculture (San Francisco, CA: Sierra Club Books, 1996).

73 John Clark (ed.), The African Stakes of the Congo War (New York: Palgrave Macmillan, 2002).

74 Homer-Dixon, Environmental Scarcity, pp. 67–9.

75 Robert Kaplan, 'The Coming Anarchy,' The Atlantic Monthly, February 1994, pp. 44–76.

76 Michael O'Hanlon and P.W. Singer, 'The Humanitarian Transformation: Expanding Global Intervention Capacity,' Survival, Spring 2004, pp. 77–96..

77 Again, China and India represent particular dangers. Both are very densely populated and resource poor, with serious internal cleavages between their more- and less-developed regions (India further suffers from a high level of ethnic, religious and linguistic fragmentation). Additionally, despite their impressive rates of economic growth, simple arithmetic dictates that they will remain developing nations for decades to come.

78 Harold James, The End Of Globalization (Cambridge, MA: Harvard University Press, 2001).

79 Importantly, Collier notes that resources are not by themselves the cause of conflicts, and that they do not make it inevitable; he also identifies a correlation between low GDP growth and low education levels with the outbreak of these conflicts. Paul Collier, 'Doing Well Out of War,' in Mats Berdal and David M. Malone (eds), Greed and Grievance: Economic Agendas in Civil Wars (Boulder, CO: Lynne Rienner Publishers, 2000), p. 97.

80 Klare, Blood and Oil, pp. xii–xiii; Michael L. Ross, 'What do We Know about Natural Resources and Civil War?,' Journal of Peace Research, vol. 41, no. 3, pp. 337–56.

81 Michael L. Ross, 'How does Natural Resource Wealth Influence Civil War? Evidence from 13 Cases,' International Organization, Winter 2004.

82 Scott Pegg, 'Globalization and Natural-Resource Conflicts,' Naval War College Review, Autumn 2003, p. 82–95. For a more general discussion of 'criminalised states,' see Jean-Fran├žois Bayart, Stephen Ellis and Beatrice Hibou, The Criminalization of the State in Africa (Bloomington, IN: Indiana University Press, 1999).

83 While the figures provided by the International Maritime Bureau's Piracy Reporting Centre indicate several hundred attacks a year, only a handful involve the removal of large quantities of bulk goods, or the outright seizure of ships. Moreover, the targeted vessels have generally been smaller than 10,000 tonnes displacement.

84 Fred Weir, 'Georgia Risks War Over Separatists,' Christian Science Monitor, 12 August 2004, p. 6. A similar risk exists in the conflict between Armenia and Azerbaijan.

85 Anton Koslov, 'Russia and the US in the New Balance of Power in Central Asia,' in Hall Gardner (ed.), NATO and the European Union: New World, New Europe, New Threats (Aldershot: Ashgate, 2004), pp. 232–41.

86 Mark J. Valencia, China and the South China Sea Disputes (London: Oxford University Press, 1995).

87 Energy Information Administration, 'World Net Nuclear Power Generation, 1980–2004,' 7 July 2006, http://www.eia.doe.gov/fuelnuclear.html.

88 This includes proponents of the 'hydrogen economy,' who envision nuclear-generated electricity producing fuels for vehicles (like hydrogen), rather than renewable sources like wind and solar. Thomas P. Barnett, Blueprint for Action: A Future Worth Creating (New York: Putnam, 2005).

89 See 'Cuba's Nuclear Power Plants at Juragua,' FAS.org, http://www.fas.org/nuke/guide/cuba/main.html.

90 Office of Civilian Radioactive Waste Management, Department of Energy, Yucca Mountain Repository, July 2007, http://www.ocrwm.doe.gov/index.shtml.

91 H.A. Feveison, T.B. Taylor, F. von Hippel and R.H. Williams, 'Plutonium Economy,' Bulletin of the Atomic Scientists, vol. 32, no. 10, December 1976, pp. 10–21, 46–55.

92 Arjun Makhijani, Plutonium End Game: Managing Global Stocks of Separated Weapons-Usable Commercial and Surplus Nuclear Weapons Plutonium, Institute for Energy and Environmental Research, Report, Jan. 2001.

93 Ewen Askill and Ian Traynor, 'Saudis Consider Nuclear Bomb,' Guardian, 18 September 2003, http://www.guardian. co.uk/saudi/story/0,11599,1044402,00.html.

94 Thomas Homer-Dixon notes that 'as environmental degradation proceeds, the size of the potential social disruption will increase, while our capacity to … prevent this disruption decreases. It is therefore not a reasonable policy response to assume we can intervene at a late stage, when the crisis is upon us.' See Homer-Dixon, 'On The Threshold: Environmental Changes as Acute Causes of Conflict,' International Security, vol. 16, no. 2, Fall 1991, pp. 76–116.

95 Clayton Christensen, The Innovator's Dilemma: When New Technologies Cause Great Firms to Fall (Cambridge, MA: Harvard University Press, 1997).

96 For an examination of how conventional economic measures distort cost–benefit calculations, see Clifford Cobb, Ted Halstead and Jonathan Rowe, 'If the GDP is Up, Why is America Down?,' The Atlantic Monthly, vol. 276, no. 4, October 1995, pp. 59–78.

97 Windmills on floating platforms (compared with conventional offshore windmills that take advantage of stronger offshore winds) may cost only a third as much to build and set up, and can be redeployed easily to meet shifting demand and operated in a wider range of locations (such as in deep water, hundreds of miles out to sea), while possibly tripling the output of land-based turbines. Ker Than, 'Floating Ocean Windmills Designed to Generate More Power,' LiveScience, http://www.livescience.com/technology/060918_floating_windmills.html. Flying windmills exploit the wind stream and return the energy produced to electrical grids on the ground through a tether. Given the very high levels of relatively inexpensive power a small number of such clusters can produce (it has been estimated that a few thousand could meet Canada's present demand for electricity), this approach would seem especially attractive for the purposes of a rapid changeover. Lawrence Solomon, 'Flying Windmills,' National Post, 19 March 2005, http://windenergynews.blogspot.com/2005_03_01_archive.html.

98 See Andrew Murr, 'No More Electric Bills,' Newsweek, 15 August 2005, p. 43.

99 The options include not just more mass transit, rail lines, telecommuting and small cars, but diesel engines, electric cars, hybrid vehicles making partial use of batteries, internal combustion engines using 'lean burn' technologies, and new materials that are lighter and stronger than those presently used.

100 At this point one of the highest priorities for research and development in this area is arguably to develop methods that maximise the energy efficiency of biofuels processing.

101 Some studies contend that the growth in energy efficiency can outpace plausible economic growth rates in the advanced economies. See Ernst von Weizsacker, Amory Lovins and Hunter Lovins, Factor Four: Doubling Wealth, Halving Resource Use, the New Report to the Club of Rome (London: Earthscan, 1997).

102 Such initiatives can of course be financed through money withdrawn from subsidies for fossil-fuel use, and fuel taxes, which also appear to have been a powerful contributor to Europe's relative fuel efficiency.

103 'Sweden Aims for Oil-Free Economy,' BBC News, 8 February 2006, http://news.bbc.co.uk/2/hi/science/nature/4694152.stm. John Vidal, 'Sweden Plans to be World's First Oil-Free Economy,' Guardian, 8 February 2006, http://www.guardian.co.uk/environment/2006/feb/08/frontpagenews.oilandpetrol.

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