Similar Posts

Recent Comments from our Readers

  1. Avatar
  2. Avatar
  3. Avatar
  4. Avatar
  5. Avatar

13 Comments

  1. Rod,

    Yeah, I’ve been seeing those ads for a few months now, and thought much the same thing – Shell isn’t going to *sell less oil* if people increase their efficiency – because of the fact that much of the world is still developing, Shell and other energy companies can increase sales even while developed nations might make modest decreases in energy usage.

    Also, by running these ads they can try to create a “feel good” impression in the public’s minds, falsely assuring the public that they can just continue to do the same thing – burn lots of fossil fuels, just by doing it 5 or 10 percent more efficiently.

  2. I certainly support using energy efficiently, though we need to take a whole-system approach to it. We can always spend more money and resources to increase energy efficiency, but there comes a point where the investment is too large and the efficiency improvement is too small.

    Having said that, lets look at the ‘nut’ of the message here. What I see is Shell playing the other side of the Jevons Paradox. The usual statement of this is that energy increased efficiency results in increased consumption of energy. While this may or may not always be true, what is true is that increased efficiency increases the value obtained from consuming a unit of energy. If the increase in value is large and there is large demand for the product or result of the energy consumption, indeed energy consumption will increase.

    But the key point is value delivered per unit of energy consumed. Here is where the other side of the Jevons Paradox comes into play. If more value is delivered, the provider of the energy can capture part of that value by raising the price of energy. The price increase will be tolerated by the energy consumer because he is still ahead in value delivered. The energy provider can increase profits, even in the face of a decline in the amount of energy delivered. So energy conservation can be an energy company’s best friend. If an external agency (e.g. government) is promoting this energy efficiency, so much the better.

    Where all this can break down is if some other
    source comes into the market that can undercut the price of delivered energy (nuclear, anyone?). Should this be a threat, the incumbent energy supplier will try to keep the upstart out of the market.

  3. In the meantime & wading back to the swamp ….

    – The US has entered into agreements with Vietnam to operate military bases. (Next door to China)

    – China is claiming historic and ancestry ownership on seas of water that extend way beyond the current maps of the United Nations (oil deposits anyone?)

    – China has stated that it would ‘watch’ the North Korea situation and no one else

    – Burmania and other countries want to prevent China from building more Hydro since the dams would cut the flow of rivers

  4. The statement is somewhat ambiguous. On one hand it could mean they are interested in efficiency to make the oil supply go further – the straight interpretation. But since Shell and other companies will go to great lengths to drill for oil, efficiency of their operations – pipelines, access, regulations, etc – is another very important aspect to them.

    More efficient vehicles are not enough to dampen growth of their markets and may even encourage it AKA the rebound (Jevons) effect.

    They will do as much as they think is needed to keep their line of business sustainable, but won’t go so far as to suggest another technology which will upend their business model. They will do algae R&D, build roads, hospitals, or anything else to culture $entiment$ of endearment – after all they’re making a ton of money everyday and goodwill pays off huge dividends as well. I can’t say I blame them, I’d probably do the same kinds of things too if I was in their business.

    1. @Jason C

      I realize I am an outlier who cannot stomach doing something I do not believe in just because it happens to be financially rewarding.

      My philosophy about energy is that we need to use more, not less. Energy expended per unit time is power, and it takes power to make improvements. Since Einstein taught the world a hundred years ago that there is a way to convert material into energy, there is virtually no limit on the amount of energy that we can free up from the world around us.

      The key then is to apply that power to produce good things, not evil ones. My experience with a rather large selection of humans over the past 50 years leads me to trust most of them to do the right thing. The ones who do not do the right thing on a regular basis can be overcome if all of the rest of us have all of the power that we need.

      1. Rod, when an oil venture comes to town such as what has recently occurred in Montana, prosperity tends to follow. If a nuclear power plant comes to town, prosperity tends to follow. Each industry usually carries a core group of true believers and a whole host of others who for them ‘it’s just a job’.

        The petroleum engineers and inner circle of a company like Shell believe in their hearts they are doing a good thing for their company and feeling good about the prosperity they bring. They’re human and so am I, and thus if I walked in their shoes, I’d probably do the same things to promote the prosperity of the company and community I worked for.

        I personally have no ambition to work for an oil company for my own moral reasons as well, but I don’t believe the people who work for Shell necessarily have a pernicious intent. They intend to make money and look good while doing it. And if it cleverly disses the competition (nuclear), well that’s part of the package when you trust a snake not to bite you. I looked at their ‘efficiency’ website and it’s full of the typical corporate rah-rah stuff with quite a bit of it promoting how great their latest projects are.

        I also believe we need to use more energy and use it wisely. Efficiency is a good thing but the expectations from it are ignorantly misaligned by many. Efficiency like many other buzzwords have become hijacked for their marketing value. It’s a better word to associate yourself with than ‘safe’ in my opinion.

        1. @Jason C – please do not confuse petroleum engineers with the marketers who design the ad campaigns or the corporate decision makers who refuse to invest in nuclear energy as a better way to produce the product that their customers desire.

          I have nothing against the technical workers who are doing what they consider to be a good job. I do have a beef with the greedy ones who will dis their competition to make themselves look better.

          Perhaps it is my background as a competitive swimmer. Unlike some contact sports, the only way for a swimmer to win is to move faster; there is nothing he can do to slow down the competition or to make them look bad.

        2. One more thing – the prosperity associated with oil extraction tends to be short term and generally leaves a mess behind once the oil runs out. There is a lot of documented history that supports that statement.

          In contrast, once a nuclear plant comes to town, there is really no technical or logical reason why that installation cannot continue to operate and provide prosperity for generations into the future.

        3. Rod, not only does oil eventually go bust, but there are some areas of the world such as Nigeria that are oil rich but the population of 167 million reaps almost nothing from this vast wealth.

  5. Big Oil has always been linked to corruption and coup d’état and assassination. Standard Oil was once dismantled due to some disturbing facts. If the people of Nigeria do not get a fair share in the oil benefits, blame Big Oil.

    1. According to Greenspan, Nigeria’s oil fortune could also be linked to what is called ‘Dutch disease’.

      This term was coined in the 1970’s when a country rich in natural ressources (Gas in the Netherlands) causes its currency to strengthen and harm their other exports.

      Nigeria also had corrupt government in the last decades.

  6. Conserving energy would make sense if there was a limited speed at which fuel can be supplied, but that fuel supply could last forever. With oil however, we have limited reserves on earth, and no hope of economically getting more from other planets (such as Titan). What use is it then to consume it more slowly? It only buys us time until the inevitable happens and the resources are gone. Is it that we are desperately working on something to replace it so we need the time? No, we already have the shovel-ready replacement with nuclear power and Shell is in no hurry to abandon oil.

    The whole idea of conserving a resource that is going to be depleted eventually, is a hoax. It is used to justify higher prices, lower living standards, and population reduction (=the easiest way to conserve).

Comments are closed.