It is estimated that there remains over 10 to 11 trillion barrels of oil in place, how much can we recover, likely a small but relevant fraction. But that fraction grows as the price of oil rises - which creates an incentive for technological innovation to unlock this “trapped” potential. The oil sands Carbonates and Oil Shale deposits in the U.S. are excellent examples of a resource that is trapped, like the oil sands was decades ago, and offshore decades before that. This is part of what will combat the issue of “dwindling conventional oil”, alternative sources of energy will also help combat the issue of less conventional oil, and relatively more expensive unconventional sources. Ignoring the impact of economics and innovation conveniently allows people to ignore our species history and quiet frankly, evolution. The rapid rise to $150 was a cause for concern and the eventual rise back to $150 will merely indicate the rising cost of oil as a direct result of less “cheap” oil and more expensive oil that will be deeper underground and/or harder to access; assuming the rise isn’t as rapid as prior. The taste of $150 was an incentive for consumers to move away from their gas hungry vehicles towards more efficient vehicles. That’s a good thing for everyone, not just Albertans who benefits from the royalties, and who purchase goods and services, mostly from outside of Alberta. The era of Cheap Oil is over, the era of “slightly more expensive oil” is upon us. (please repeat statement every few decades). David McColl

Thanks for this information Innadiated. I believe we must concentrate all our efforts on Oil replacement technologies, after all it's only Hydrocarbons. We should be able to make a synthetic version.

Groundpounder
“The most successful people are those who are good at Plan B.”

Funny how that peak oil argument quickly turns away from the imaginary peak oil argument and becomes a social engineering argument by some people who really love to dictate to others how to live there lives by taxes and restrictions they envision.
The peak oil story is as old as oil itself for example I got told in the late 70th in school we have no oil left on this planet by 2000 it is unfortunate that if socialists can't convince the adults they turn to brainwash our kids in school with all there fear mongering about peak oil, global warming and over population.
The real complexity is that The misery of the people is there livelihood.

Concerned Citizen:
While I love your optimism, you are overlooking a few unfortunate facts. But you have the right idea, now lets put it in a realistic light.




David McColl said:
`To avoid growth that puts direct demand on oil supplies: impose a tax that is sufficient to cause a collapse in the economic system. This would be sufficient to reverse growth and oil demand. We will ignore the serious loss of quality of life. But at least the average Canadian can be driven in poverty.

Nope. The average consumer would save about $3000 a year by rejecting fossil fuels as a primary source of energy. This will be achieved by using current technology, and will actually increase individual freedoms or quality of life, and raise many people out of poverty.

===============================

It is not possible to reject fossil fuels, you can move the dependency but in the end ALL of our technology is based on fossil fuels. A quote from http://www.lifeaftertheoilcrash.net/ :
~~~~
"Are all forms of modern technology actually petroleum products?"

Yes.

It's not just transportation and agriculture that are entirely dependent on abundant, cheap oil. Modern medicine, water distribution, and national defense are each entirely powered by oil and petroleum derived chemicals.

In addition to transportation, food, water, and modern medicine, mass quantities of oil are required for all plastics, all computers and all high-tech devices. Some specific examples may help illustrate the degree to which our technological base is dependent on fossil fuels:

Automobiles:
The construction of an average car consumes the energy equivalent of approximately 20 barrels (840 gallons) of oil. Source Ultimately, the construction of a car will consume an amount of fossil fuels equivalent to twice the car’s final weight. Source

It's also worth nothing that the construction of an average car consumes almost 120,000 gallons of fresh water. Source Fresh water is also rapidly depleting and happens to be absolutely essential to the petroleum refining process as each gallon of gasoline requires almost two gallons of fresh water for refining. Source

Computers:
The construction of the average desktop computer consumes ten times its weight in fossil fuels. Source

Microchips:
The production of one gram of microchips consumes 630 grams of fossil fuels. According to the American Chemical Society, the construction of single 32 megabyte DRAM chip requires 3.5 pounds of fossil fuels in addition to 70.5 pounds of water. Source The Environmental Literacy Council tells us that due to the "purity and sophistication of materials (needed for) a microchip, . . . the energy used in producing nine or ten computers is enough to produce an automobile." Source In his book "The Nine Nations of North America", author Joel Garreau explains in graphic detail just how much energy it takes to fashion a typical microprocessor:
. . . microchips are not made one by one. They are printed in a batch on a silicon wafer, say, four inches in diameter. Each time a layer of stuff is printed on this silicon wafer, the wafer must be treated so the stuff you've laid on will stay there. This process is achieved through the application of monumental quantities of energy. In effect, as each layer of the circuit is laid on, the whole wafer is "baked" at temperatures sometimes high enough to reach the outer limits of technology. Source

The Internet:
Contrary to popular belief, the internet consumes tremendous amounts of energy. Author John Michael Greer explains:
The explosive spread of the internet, finally, was also a product of the era of ultracheap energy. The hardware of the internet, with its worldwide connections, its vast server farms, and its billions of interlinked home and business computers, probably counts as the largest infrastructure project ever created and deployed in a two decade period in history. The sheer amount of energy that's been been invested to create and sustain the internet beggars the imagination. Source

Recent estimates indicate the infrastructure necessary to support the internet consumes 10% of all the electricity produced in the United States. Source The overwhelming majority of this electricity is produced using coal or natural gas, both of which, as explained momentarily, are also near their global production peaks. Source #1 Source #2 Source #3 Source #4 Source #5

Concrete, Asphalt, Highways, and Modern Cities:
It is hard to precisely quantify how much energy is necessary to construct and maintain a modern city. Some of NASA's recent images of cities, however, hint that the volumes of energy invested in modern cities are almost unfathomably prodigious.
~~~~



``Economic growth requires fuel, or energy. Our current economic system, or for that matter way of life, is heavily based upon carbon fuel sources – and has been for over hundreds of thousands of years.``

Yes. But I disagree with the notion of economic growth. Just because the economists say it is necessary doesn`t mean that it can be supported by the planet.

===============

Yup.





``In time substitutes will be found, but a transition away from carbon intensive fuels will not happen in our lives.``

Totally untrue. The transition is happening later this year. In 2 months I will be putting down a deposit on a Nissan Leaf electric car. It will cost about $30,000. Its price will be competitive with (likely less expensive than) its gasoline powered competition, when you consider total cost of ownership. Within 5 years, Nissan`s innovations in battery and electric drivetrain technology will be producing cars in the low $20,000`s that have 200 km range, cost $25 a month to charge, take 15 minutes to recharge, hardly depreciate because they have so few moving parts, and cost almost nothing in maintenance to keep on the road, for the same reason.

===================================

Look above, and also:

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"What about alternative energy systems like solar panels and wind turbines? Are they also manufactured using petroleum and petroleum derived resources?"

Yes.

When considering the role of oil in the production of modern technology, remember that most alternative systems of energy — including solar panels/solar-nanotechnology, windmills, hydrogen fuel cells, biodiesel production facilities, nuclear power plants, etc. all rely on sophisticated technology and energy-intensive forms of metallurgy.
~~~~





``Oil, for example, permeates almost everything – like you said, look around and find something it doesn`t. As such, there is a lot to change``

Manufacturing of plastics and the like is the one legitimate use of oil. However, biofuels could take over that role, but I agree that this is best suited for oil, and we should instead dedicate agriculture to feeding the world.

=================================

Biofuels present a huge problem economically and environmentally speaking: http://www.edmontonjournal.com/business/energy-resources/Controversy%20mounts%20over%20fallout%20from%20biofuel/2555412/story.html





``You do realize that if growth doesn`t put demand on oil it will put demand on other energy inputs, be they nuclear, gas, wind, solar, hydro, etc. Each option has its benefits and costs, and not all options are compatible with a given end use.``

Yes and no. While growth increases demand for energy (all else being equal), this will be more than offset by the increases in efficiency resulting from a shift away from fossil fuels. And this is also is why we should be slowing and eventually halting economic growth. Again, just because economists like to show off charts which show economic growth as a good thing does not mean the planet can support it.

=======================================

In our current economic reality of debt-credit, economic growth and oil consumption go hand in hand.. further another problem exists known as Jevon's Paradox:

~~~~
Even if we are willing to undertake such an endeavor, the problem will still not be solved due to a phenomenon known as "Jevon's Paradox," whereby increases in energy efficiency are obliterated by corresponding increases in energy consumption.

The US economy is a good example of Jevon's Paradox in action. Since 1970, we have managed to cut in half the amount of oil necessary to generate a dollar of GDP. At the same time, however, our total level of oil consumption has risen by about fifty percent while our level of natural gas and coal consumption have risen by even more. Thus, despite massive increases in the energy efficiency over the last 35 years, we are more dependent on oil than ever. This trend is unlikely to be abated in a market economy, where the whole point is to make as much money (consume as much energy) as possible.
~~~~





``While electricity could help with vehicles, the technology for massive and efficient adoption isn`t ready.``

It is indeed ready, and it is 5 times more efficient than fossil fuels. Nissan will be transforming the automotive industry within 5 years and pushing every other automaker who doesn`t do likewise out of business. It was actually ready 10 years ago with NiMH batteries but Chevron got control of the patent for those and shut `em down.

And the irony of the whole thing, the bitter aftertaste that people in the know have to swallow, that enrages so many Canadians who can so clearly see our future destroyed by the oil industry, is twofold:

1) Contrary to what the scare tactics would like you to believe, consumers will have to give up neither money nor quality of life by shifting away from fossil fuels. Rather, we would save money and live better lives. We would not need any new electrical generation infrastructure to completely switch over to electric vehicles. Here is an interesting fact: by not refining one gallon of gasoline from the tar sands, we would save enough electricity to power an electric car to go almost as far as the gallon of oil would take a gasoline powered car!!!!! The difference being that it costs 5-10 times less to charge an electric car than fuel a gasoline powered car!!!!! Apparently Nissan is making its battery packs for $300 per kWh RIGHT NOW. That price will come down dramatically within the next 5 years and make owning and operating a typical automobile way cheaper than it is now. And the cars will be better. And our energy consumption for transportation will go down by 4 times!!! (we will not be experiencing economic growth over this transition to compensate for the increased efficiency, because the oil sands will be shut down!!!) There is no shortage of raw material for the batteries, and it is only a matter of 10 years before production could be ramped up to provide the majority of the automobile market in the world with inexpensive electric vehicles. Bye bye tarsands!!

2) In the face of this inevitable transition, should we be developing a fossil fuel based economy? It`s insanity what these guys are pushing on us. What will happen to Canada`s economy when within 10 years every automobile consumer makes the wise choice and buys an electric car? This is the crime that the oil sands industry is imposing on future Canadians (and my future in 10 years). Because society`s continued reliance on fossil fuels as an energy source is not justified financially, and the whole system will begin to come crashing down within 10 years. Then Canada will be one of the have-not nations. All those millions of people we brought in to serve our economic growth based on oil sands development will be unemployed. We should instead develop our economy around sustainable options. But the problem is that the people in power in our country really don`t care about the future 10 years down the road. They are interested in how much profit they can make with in the next 2 years and then they`ll say ``good bye suckers, thanks for the millions, but you`ll have to deal with the aftermath yourselves.

=================================

Couple problems:

The ability for enough people to purchase these cars to make the difference you claim would require amounts of loans and risk not seen in a long time. Today people need loans to buy big ticket items, and many people cannot qualify. Unless people can afford to buy these cars, having an economic mix of those who can afford electric and those that need fossil fuels will not work. As well, as noted above the cars themselves are a product of fossil fuels, the amount of fuels needed to replace the world-wide fleet of gas-driven vehicles which is around 800million is pretty steep. To top this off, how do we create green electric powered transport trucks, boats, airplanes and military aircraft? Green powered cranes and other construction machines, not to mention the fossil fuels used to build those.


Electricity isn't a power source. And when it comes to "renewable" energy, the numbers are pretty dismal:

~~~~
"What about green alternatives like solar, wind, wave, and geothermal?"

Few people realize how much energy is concentrated in even a small amount of oil or gas. A barrel of oil contains the energy-equivalent of almost 25,000 hours of human labor. Source A single gallon of gasoline contains the energy-equivalent of 200-to-500 hours of human labor. Source

Most people are stunned to find this out, even after confirming the accuracy of the numbers for themselves, but it makes sense when you think about it a bit: it only takes one ($3) gallon of gasoline to propel a three ton SUV 10 miles in 10 minutes when traveling 60 mph. How long would it take you to push a three ton SUV 10 miles?

While people tend to drastically underestimate the energy density of oil and gas, they drastically overestimate the energy density (and thus scalability) of renewables. Some examples should help illustrate this point:

Example #1: Wind compared to Natural Gas

It would take every single one of California's 13,000 wind turbines operating at 100% capacity (they usually operate at about 30%) all at the same time to generate as much electricity as a a single 555-megawatt natural gas fired power plant. Source

Example #2: Wind compared to Coal

As of 2004, the United States has 6,361 megawatts of installed wind energy. This means that if every wind turbine in the United States was spinning at peak capacity, all at the exact same time, their combined electrical output would equal that of six coal fired power plants. Since, as mentioned previously, wind turbines typically operate at about 30% of their rated capacity, the combined output of every wind turbine in the US is actually equal to less than two coal fired power plants. Source

Example #3: Solar compared to Coal

The numbers for solar are ever poorer. For instance, on page 191 of his 2004 book "The End of Oil: On the Edge of a Perilous New World", author Paul Roberts writes:
. . . if you add up all the solar photovoltaic cells now running worldwide the combined output - about 2,000 megawatts - barely rivals the output of two coal-fired power plants.
Robert's calculation assumes the solar cells are operating at 100% of their rated capacity. In the real world, the average solar cell operates at about 20% of its maximum capacity as the sun is not always shining. This means the combined output of all the solar cells in the world at the end of 2004 was equal to less than 40% of the output of a single coal fired power plant. Source

By 2008, there was just over 5,000 megawatts of solar pv cells installed worldwide. Operating at average efficiency of 20%, the combined output of all the pv cells in the world is now equal to the output of a single coal fired power-planet.

Example #4: Solar and Wind compared to Petroleum

In order to offset a 10% reduction in U.S. petroleum consumption, the amount of installed solar and wind energy would have to be increased by 2,200%. Source

Example #5: Solar compared to Gasoline

The amount of energy distributed by a single gas station in a single day equivalent to the amount of energy that would produced by four Manhattan sized city blocks of solar equipment. (There are over 170,000 gas stations in the U.S. alone.) Source The reason for this differences is because, as explained above, oil is an incredibly dense sources of energy while solar is extremely diffuse

Example # 6: Low starting point for industrial solar

It would take close to 220,000 square kilometers of solar panels to power the global economy via solar power. This may sound like a marginally manageable number until you realize that the total acreage covered by solar panels in the entire world right now is a paltry 10 square kilometers. Source

Example #7: Diminutive contribution of residential solar:

According a recent MSNBC article entitled, "Solar Power City Offers 20 Years of Lessons:"
By industry estimates, up to 20,000 solar electric units and 100,000 heaters have been installed in the United States, diminutive numbers compared to the country’s 70 million single-family houses. Source
This means that even if the number of American households equipped with solar electricity is increased by a factor of 100, less than two million American households will be equipped with solar electric systems. Assuming we are even capable of scaling the use of household solar electric systems by that amount, two questions remain:

#1. What do the other 68 million households do? What about the millions of companies, nations, and industries around the world of which the industrialized world are dependent?

#2. Since oil, not electricity, is our primary transportation fuel (providing the base for over 95% of all transportation fuel) what good wih this do us when it comes to keeping our global network of cars, trucks, airplanes, and boats going?

Example #8: Electric Car Batteries Versus Gasoline Engines

Dr. Walter Youngquist explains:
. . . a gallon of gasoline weighing about 8 pounds has the same energy as one ton of conventional lead-acid storage batteries. Fifteen gallons of gasoline in a car's tank are the energy equal of 15 tons [3,000 pounds] of storage batteries. Source
Some will say that the problems associated with lead-acid batteries as pointed out by Dr. Youngquist can be resolved by moving to lithium-ion batteries. Unfortunatley, lithium is in such short supply globally that electric car manufacturers are already anticipating problems sourcing it even though only a tiny fraction of westerners currently drive electric cars:
Europe is light-years ahead of America in wind energy, and Germany leads the world. The German numbers are painting a dismal picture for wind’s capacity. E.ON Netz – one of th eworld’s largest private energy providers – owns over 40% of Germany’s wind generating capacity. They released a report titled "WIND REPORT 2004" stating that wind energy require "shadow stations" of traditional energy on back-up reserve in case the wind forecast is wrong. They state that reserve capacity needs to be 60% to 80% of the total win capacity! So as mo wind comes on line, it is all but certain that more hydrocarbon reserve capacity will be required, further demonstrating how renewable energy is used to supplement over-consumption. Source
Figure 2 illustrates the different projections of uranium depletion, pending an increase in annual consumption rates of 3%, 5% or 8%. Currently, uranium production falls incredibly short of the demand. As oil resources become scarce, uranium will have more pressure put upon it as a resource. All three different scenarios have a similar course until around 2013, where they part trails. By 2020, there is a serious uranium shortage.
Let's assume a Pollyanna position and assume that uranium deposits can be doubled up in the coming decade. Figure 3 illustrates the 3 different scenarios, depending on the net increase in consumption per year. Rather than 2013 being a focal year, it is stretched out by 3 years to 2016.
Uranium supply issues aside, nuclear energy (like solar and wind) is not an economically or energetically feasible transportation fuel. Put simply, you can't power your car with a nuclear reactor in the trunk.

Even if these problems are assumed away, a large scale switch over to nuclear power is still not going to do all that much to solve our problems due to the cost and time frames involved in the construction of nuclear power plants. It would take 10,000 of the largest nuclear power plants to produce the energy we get from fossil fuels. Source At $3-5 billion per plant, it's not long before we're talking about "real money" - especially since the $3-5 billion doesn't even include the cost of decommissioning old reactors, converting the nuclear generated energy into a fuel source appropriate for cars, boats, trucks, airplanes, and the not-so-minor problem of handling nuclear waste.

Speaking of nuclear waste, it is a question nobody has quite answered yet. This is especially the case in countries such as China and Russia, where safety protocols are unlikely to be strictly adhered to if the surrounding economy is in the midst of a desperate energy shortage. It may also be true in the case of the US because, as James Kunstler points out in his recent book, The Long Emergency:
. . . reactors may be beyond the organizational means of the society we are apt to become in the future, mainly one with much weaker central authority, less police power, and reduced financial resources . . . in the absence of that (cheap) oil we can't assume the complex social organization needed to run nuclear energy safely will even exist. Source
Assuming we find answers to all questions regarding the cost and safety of nuclear power, we are still left with the most vexing question of all:
Where are we going to get the massive amounts of oil and money necessary to build hundreds, if not thousands, of these reactors, especially since they take 10 or so years to build and we won't get motivated to build them until after oil supplies have reached a point of permanent scarcity?

Abiotic oil propaganda, coupled with finger-pointing at the oil industry, is a perfect ruse to ensure people don’t start powering down. Peak Oil is not the oil industry’s propaganda. Abiotic oil is the oil industry’s propaganda. Source
Interestingly enough, five of the seven policy recommendations made by outspoken abiotic oil advocate Jerome Corsi in his book "Black Gold Stranglehold" sound like taxpayer funded giveaways to Big Oil: (commentary in italics added)

#1. Promote scientific research to investigate alternative theories.

#2. Expedite leases offshore and in Alaska to encourage oil exploration. (Who benefits from this?)

#3. Provide tax credits for deep-drilling oil exploration. (Who benefits from this?)

#4. Create an oil research institute to serve as a clearinghouse of oil industry information. (Who benefits from this?)

#5. Develop a public broadcasting television series devoted to the oil industry. (Who benefits from this?)

#6. Reestablish a gold-backed international trade dollar.

#7. Establish tax incentives for opening new refineries in the U.S. (Who benefits from this?)


With the exception of numbers one & six, Corsi's policy recommendations read as though they came from an oil-industry wishlist. That Corsi would so vigorously advocate tax breaks for the oil industry should come as little surprise: in 2004, he coauthored the "Swift Boat Veterans for Truth" attack book that many believe helped the tax cut-obsessed and oil industry-backed Bush administration stay in office.

It is worth noting that Corsi - the primary media vector for the current incarnation of the abiotic oil theory - spent the bulk of his early professional career running covert operations for USAID, the U.S. government agency tasked primarily with destabilizing foreign governments not amenable to western oil interests. Source In 2005, he was personally thanked by George W. Bush for his recent work attempting to destabilize oil-rich Iran. Source

In his book, Corsi cites the Eugene Island 330 oilfield as proof that oil fields refill themselves. Apparently he or his research staff failed to do a google images search for "Eugene Island 330." If he had performed such a search, he would have come across the following graph which plainly shows Eugene Island 330's oil production in decline for the past 25 years. Corsi's primary example of a "refilling field" is only producing about 1/6 the amount of oil it produced at its peak:

Example #9: Energy Intermittency, Lack of Battery Technologies

Unlike an oil pump, which can pump all day and all night under most weather conditions, or coal fired/natural gas fired power plants which can also operate 24/7, wind turbines and solar cells only produce energy at certain times or under certain conditions. This may not be that big of a deal if you simply want to power your discretionary household appliances or a small scale, decentralized economy. If, however, you want to run an industrial economy that relies on airports, airplanes, 18-wheel trucks, millions of miles of highways, huge skyscrapers, 24/7 availability of fuel, etc., an intermittent source of energy will not suffice.

While promising work is being done to counteract the intermittency of wind and solar energy, most of this work is still in the developmental stage and won't be ready or cost effective on a large scale for several decades at the earliest. Source

Example #11: Lack of Energy Density

As explained a few times in the preceeding paragraphs, oil is simply unmatched in its energy density. A good way to illustrate its density is to analyze what it would take in terms of solar pv panels to generate the enegy necessary to run a typical automobile. Physicist Les Jackson explains that once you account for the typical solar PV efficiency rating of 20%, you would need a solar panel set up measuring almost 100 feet on each side in order to power your car:
It wasn't the sound of his car engine that was distracting Ian Clifford. The chief executive of Canadian business Zenn Motors makes electric vehicles that give off no noise. He was worried that the obvious choice to power his next car - the same stuff that goes into laptops and cellphone batteries - was going to be in short supply. "If you look at the increase in lithium prices over the past seven to 10 years, it's been dramatic," says Clifford. Zenn's short-range urban cars traditionally used nickel metal hydride batteries, but his next vehicle - an 80mph model with a 250-mile range - needed more efficiency. "There are very limited global reserves, and they're in potentially very unstable parts of the world," adds Clifford. Source

The sun delivers approximately 1,000 watts of total energy per square meter (roughly 100 watts per square foot) on the earth, and that's really only when there's direct light, at noon, on a clear day. If you could convert all that solar energy to electric power you'd need 7.43 square feet for each horsepower (there are 743 watts in a horsepower) in your motor. You need at least 50 horsepower (37,000 watts) to safely move a car in real-world traffic, so you'd need at least 371 square feet of surface area to generate the electricity. That's a square about 19 feet on a side, so your car would have to be very large or have a huge solar sail on it to capture the light.

It gets worse, because solar photovoltaic panels waste most of the sun's energy. The best solar panels on the market today are less than 20% efficient at conversion of energy, so you really need panels 5 times larger than the one in the example above to create enough electricity to run the car. Remember also that we're talking about "perfect" conversion of energy at midday when it's clear outside. As the daylight goes down so does the amount of electricity. If this isn't difficult enough, how do you compensate for those periods when the car is driving in the rain, cloudy weather, through tunnels and at night? What we've got here is a fundamental problem of capacity: There's simply not enough surface area on a car to generate sufficient power from photovoltaic cells.

Add to these pressures the fact that photovoltaic cells cost at least $6 per watt of output, making these things prohibitive for most people even if size weren't a consideration. Source

Are there ways around some of these limitations? Yes, if you have a tremendous amout of money at your disposal. Some people, for instance, are already experimenting with "plug-in hybrids" which they charge using solar panels on their homes. The problem is that a typical solar-pv set up designed to deliver all of a home's power in sunny California will run $50,000. The plug-in hybrid car will run another $50,000. If you want to charge the plug-in hybrid using solar panels in addition to powering your home, you will need to double or triple the pv capacity on your roof. Even in a place with a lot of sunshine, you're looking at a set-up costing $150,000-$200,000 by the time it's all said and done. Under the rapidly declining economic conditions of 2008-20099only a tiny fraction of people can currently afford such a set-up. As the housing economy continues to crumble and gas prices continue to be unpredictably volatile, the already small percentage of people who can afford this sort of capital outlay will only dwindle. Worst still, the price(s) of such a set-up are unlikely to fall due to "economies of scale" because the panels and batteries require prodigious volumes of rare metals (such as lithium and copper), the supplies of which are already falling short of demand. Source

Without a cost-effective and scalable storage (battery) technology to provide power when the wind is not blowing or the sun is not shining, large scale solar/wind farms must be backed up by things like oil pumps or natural gas/coal fired powered plants. For this reason, the expansion of renewables like wind power actually requires an expansion in the use of fossil fuels. Journalist Michael Kane explains:
Europe is light-years ahead of America in wind energy, and Germany leads the world. The German numbers are painting a dismal picture for wind’s capacity. E.ON Netz – one of th eworld’s largest private energy providers – owns over 40% of Germany’s wind generating capacity. They released a report titled "WIND REPORT 2004" stating that wind energy require "shadow stations" of traditional energy on back-up reserve in case the wind forecast is wrong. They state that reserve capacity needs to be 60% to 80% of the total win capacity! So as mo wind comes on line, it is all but certain that more hydrocarbon reserve capacity will be required, further demonstrating how renewable energy is used to supplement over-consumption. Source

Here is the real kicker: due to their prodigious size, these shadow stations cannot just be turned on and off at will. In order to be ready to produce electricity when the wind is not blowing or the sun is not shining, they must be fed a constant supply of natural gas or coal.

In other words, as counter-intuitive as it may sound at first, installing renewable energy at the industrial or utility level does not mean conventional power sources can simply be shut down or turned off. If anything, more coal fired or natural gas fired power plants have to brought on line to prevent blackouts from occurring when the wind is not blowing or the sun not shining.

Inappropriateness as Transportation Fuels:

Approximately 2/3 of our oil supply is used for transportation. Over ninety percent of our transportation fuel comes from petroleum fuels (gasoline, diesel, jet-fuel). Thus, even if you ignore the challenges catalogued above, there is still the problem of how to use the electricity generated by the solar cells or wind turbines to run fleets of food delivery trucks, oceanliners, airplanes, etc.

Unfortunately, solar and wind cannot be used as industrial-scale transportation fuels unless they are used to crack hydrogen from water via electrolysis. Hydrogen produced via electrolysis is great for small scale, village level, and/or experimental projects. In order to power a significant portion of the global industrial economy on it, however we would need the following:

Need #1: Hundreds of trillions of dollars to construct fleets of hydrogen powered cars, trucks, boats, and airplanes.

Need #2: Hundreds, if not thousands, of oil-powered factories to accomplish number one.

Need #3: The construction of a ridiculously expensive global refueling and maintenance network for number one.

Need #4: Mind-boggingly huge amounts of platinum, silver, and copper, and other raw materials that have already entered permanent states of scarcity.
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``

All the economic predictions made by other posters above about how rich Canada is going to become as a result of developing its oil sands is complete hogwash, circulated by people who are pushing an agenda and do not understand the underlying technological and energy fundamentals supporting our societies and economies.

===============================

Yup, but the solution to this problem is not as easy as you believe. Truth is our economy is simply unsustainable, if you observe how far society is sinking in debt, relative to the cost of oil, its pretty hard to deny that peak oil which will spike cost is not going to have a negative effect in everyone's lives. If you think somehow cause you have money you will avoid this problem, think again. Our fiat oil based currency will become worthless:

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"Is the financial system entirely dependent on ever-increasing amounts of cheap oil?"

Yes.

The relationship between the supply of oil and natural gas and the workings of the global financial system is arguably the key issue to dealing with Peak Oil as robost and smoothly function global capital markets must exist in order to power an orderly (or semi-orderly) transition process. In fact this relationship is far more important than alternative sources of energy, energy conservation, or the development of new energy technologies, all of which are discussed in detail on page two of this site. In short, the global financial system is entirely dependent on a constantly increasing supply of oil and natural gas.

To illustrate, if home and business loans are issued with interest rates in the 7% range, the assumption underlying the loans is that the monetary supply will increase (on average) by 7% per year. But if that 7% yearly increase in the monetary supply is not matched by a 7% yearly increase in the amount of economic activity (goods and services), the result is hyper-inflation. The key is this: in order for there to be an increase in the amount of economic activity taking place, there must be an increase in the amount of net-energy (i.e. the net-number of BTUs) available to fuel those activities. As no alternative source or combination of sources comes even remotely close to the energy density of oil (125,000 BTUs per gallon, the equivalent of 150-500 hours of human labor), a decline or even plateau in the supply of oil carries such overwhelming consequences for the financial system. Dr. Colin Campbell presents an understandable model of this comple relationship as follows:

It is becoming evident that the financial community begins to accept the reality of Peak Oil. They accept that banks created capital during this epoch by lending more than they had on deposit, being confident that tomorrow’s expansion, fuelled by cheap oil-based energy, was adequate collateral for today’s debt. The decline of oil, the principal driver of economic growth, undermines the validity of that collateral which in turn erodes the valuation of most entities quoted on Stock Exchanges. Source
~~~~