Remember peak oil? That was the fear of some years ago to which the fossil fuel industry and its supporters responded, "Drill, baby, drill!" And drill they did, and accelerated exploration in places that heretofore were inaccessible or uneconomical such as the polar seas. Suddenly, there was an urgency to drill in national parks and offshore in the Gulf and along both coasts of the United States. The industry responded worldwide, the price climbed to $100 per barrel, the stock value of ExxonMobil, Shell, Chevron, and all the rest soared. Only BP was left out of the record profits while they litigated against the damages and penalties consequent to the Deepwater Horizon spill, mostly to lose and pay literally billions in fines that drove out the CEO, did nothing for the balance sheet, and forced the company to sell off profitable assets and lay off thousands of employees.
Not to be satisfied with traditional drilling, the industry invested heavily in hydraulic fracturing, shale gas, and tar sands oil, indifferent to massive damage inflicted on the landscape, the social disruption within the communities affected, the sudden increase in pipeline leaks and train derailments and tanker car explosions that did little to offset a growing opposition or reassure regulators. Approval of the Keystone XL pipeline became the iconic bright line symbol of the industry's compulsion to exploit fossil fuel extraction to exhaustion pitted against environmental concerns and sustainability.
Today, however, the price of oil has dropped to $50 per barrel, and suddenly the equation appears very different. The reasons for the collapse are many: over-supply as a result of the splurge in drilling, external events in the Middle East, sanctions against Russia and Iran, a downturn in the world economy, conservation, and the emergence to scale of alternatives such as solar and wind power generation.
The growing success of alternatives was impeded by aggressive opposition by an industry that showed little interest regarding their standing should they exhaust the renewed supply. Nonetheless, some progressive governments moved to diversify energy sources. In Germany or Denmark, for example, wind and solar technology assume a growing share of the market and enable independence from dangerous reliance on suppliers from the Arabian peninsula and Russia.
In recent weeks, we have seen the cancellation of industry plans to exploit the Arctic and Antarctic, build new pipelines, and force conventional practice and financial dependence on a single source of supply. At $50 a barrel, the justifying pro forma and prediction of continuous exorbitant profit make no sense.
It is an incredible opportunity for change. The cover headline of The Economist newspaper this week exhorted "Seize the Day" and, in a special report, suddenly trumpeted the virtues of improved technology, increased efficiency, and clean energy; of alternative and renewable solar, wind, ocean energy, and geothermal; of new business models; of innovation in more efficient storage devices, distribution methods, and capacity; and of new pricing analyses that show the advantage of these changes to government and investors, to produce an integrated mix of new energy policy and actions, freed from the dominance, environmental degradation, social disruption, and volatility of an industry that effectively has controlled supply and demand, policy and the geo-politics of oil.
I would argue that public awareness of the destructive impact of natural resource extraction and resultant advocacy, even in places historically captive to oil interests, has contributed to this situation. Conservation in the form of energy consumption standards, more fuel efficient, less polluting automobiles, boycotts of oil-based products like Styrofoam and plastic, and individual behaviors has surely made a difference. This progress must not be lost, indeed it must be exploited now as the industry will not accept the status quo, already using the language of recovery as if that is the only choice for the rest of us.
What else must happen now? First, we must declare that we have reached peak oil now, leaving marginal and dirty product in the ground, and assert with confidence a continuing move away from our reliance on fossil fuels, sustaining and amplifying opportunities for alternatives and change. Second, we must focus on the removal of subsidies, incentives, exceptions, and loopholes that underwrite the profits of these irresponsible agents, and insist that the fossil fuel industry prove its true economy and real worth as a free-standing financial endeavor, demonstrating the real cost of its impact on our lives. Third, we must incorporate sustainability as the principled focus of our individual behaviors, our work, our purchases, and our investments, supporting alternatives, petitioning and voting for change and against regression to a system that has corroded and degraded our lives for far too long.
All of this will accrue to the ocean, to a reduction in emissions and acidification, better water quality, and community benefit associated with a healthy water cycle. We can take advantage of the fortuitous collapse of an industry from within. We must not just seize this day, but every day of our future.