Raise the Hammer
No wonder city staff don't know what to do with Richard Gilbert's peak oil report; adopting it would mean throwing out most of Hamilton's long-term growth strategy.
By Ryan McGreal
Published April 09, 2006
(This is part one of a two-part series on Richard Gilbert's vision for Hamilton. Part one looks at the implications of peak oil and peak natural gas for Hamilton's growth strategy. Part two discusses transportation, goods movement, and building energy use in more detail, focusing on Hamilton's opportunities in energy production and conservation.)
In gambling, continuing a losing strategy because you don't want to forfeit what you've already wasted is called "chasing your losses". I see a parallel in the city's ongoing denial of how climate change and declining oil production are going to grind Hamilton's long-term growth strategy to a halt.
Last June, City Council voted to hire an energy policy expert to assess Hamilton's plans for aerotropolis, public transit, city fleet, and goods movement in the event of rising energy costs. The job went to Richard Gilbert, the research director at the Centre for Sustainable Transportation and a transport consultant to the Organization for Economic Cooperation and Development.
Gilbert delivered the report to city staff last fall, but they have refused to share it with City Council, indicating that they had asked Gilbert to make some changes to the report before finalizing it. According to Gilbert, it should be released some time this month.
Last summer, I had the pleasure of meeting with Gilbert to discuss his ideas about peak oil, peak natural gas, and ways that Hamilton might thrive in what he calls the "energy-constrained world" we face.
He explained that between current gas prices and $2.50 per litre, the price shift alone wouldn't cause much change to Hamiltonians' way of life. People may replace their cars with smaller, more efficient models, but life will mostly go on as it has.
However, gas above $2.50 a litre starts to trigger some more basic changes in people's choices of where and how to live. At $4.00 a litre, our current situation becomes impossible to maintain. The big question for Gilbert was whether gas prices would reach that level within the city's twenty-five year planning horizon.
When we spoke, he was still in the research phase of his report, and suspected that the likelihood of gas exceeding $4.00 a litre was fairly remote. As he explained to me, "I think some people will be disappointed in my report." He planned to recommend that City Council continue with its GRIDS process but be sure to have a "Plan B" and a way to change direction mid-stream, just in case.
While Gilbert's report is still secret, he did agree to speak at Environment Hamilton's Annual General Meeting on March 30, and he sketched out his projection for future energy trends and his vision for the city. He stressed that his presentation was not his report. Nevertheless, both were clearly informed by the same research.
By 2018, halfway through Hamilton's planning horizon, supply shortages could raise oil prices six-fold
The biggest change since last summer is that Gilbert considers the energy situation to be much more dire than he had previously thought. Last year, he considered $4.00 a litre gasoline in 25 years to be a pessimistic scenario; today, he considers it optimistic. In fact, comparing project growth in demand with the best evidence on projected declines in supply indicates a 25 percent shortfall in supply as early as 2018, twelve years from now.
A 25 percent supply shortfall would drive oil prices up six times above current rates, pushing oil prices far beyond the $4.00 mark. As a result, he now believes Hamilton should make local energy production and conservation its Plan A.
Looking at the implications of Gilbert's thesis, it's no surprise City Council doesn't know what to do with the report. Adopting it would mean throwing out most of Hamilton's long-term growth strategy:
Don McLean recently observed, "the City consulted with the public about the principles to guide its 30–year plan. But then an independent City–commissioned review found the aerotropolis violates seven of the nine principles. In response, council voted to make the aerotropolis an automatic part of all six options being considered for the 30–year plan."
Nearly all of Hamilton's economic growth is supposed to take place via aerotropolis development spurred by air transport. Gilbert counters, "I don't have much hope for aviation in an energy-constrained world." With energy costs per tonne-kilometre that are a hundred times higher than shipping and rail, the growth in air transport is mostly an artifact of the very low real oil prices of the 1990s and the computer software dot-com boom.
Mass air travel will not survive a six-fold increase in energy costs. As it is, most North American airlines are struggling to remain profitable, losing money, going into bankruptcy, or just coming out of bankruptcy. Whatever role air travel plays in a post-peak economy, it will not provide a significant multiplier effect to businesses located around airports.
Hamilton's Goods Movement Study, published in 2005, assumes continued growth in the energy supply, calling for a network of highway improvements that further develop the "ring road" architecture of the postwar era. Despite its extensive rail connections and proximity to the largest freshwater shipping route in the world, the downtown core received scarcely a mention in the study.
Goods Movement in Hamilton: building the killer skateboard ramps of tomorrow (Photo Credit: City of Hamilton)
Gilbert's study focuses heavily on the role that "tethered" vehicles, powered by electricity and connected to the electric grid, will play in meeting Hamilton's future transportation needs (more on this in part two). Clearly, the current GRIDS recommendations move in exactly the wrong direction.
Today, Hamilton doesn't have a strategy for its public transportation system. City Council deserves credit for listening to constituents and rejecting the staff recommendation of a fare increase in its recent budget deliberations. Every year fares do not increase, they actually fall in real (inflation adjusted) terms, which means transit is becoming steadily more affordable. This in itself has proven to increase ridership, which is the goal of transit improvements.
Still, the city can do this only because the provincial government allowed Hamilton to spend its gas tax rebate on transit operating costs. That money is supposed to pay for capital improvements. The HSR's busy lines are already running over capacity (standing room only) and in many cases, packed buses pass bus stops with passengers waiting. The problem of "drive-bys" is getting worse, and the only way to alleviate it without reducing ridership is by increasing capacity.
City staff are reluctant to spend money on new buses precisely because rising energy costs are expected to increase the operating costs of the fleet. However, if the price of oil does jump six-fold in the next twelve years, Hamilton is going to need a robust transit system that can carry all those extra passengers or else the city will effectively shut down.
Hamilton's growth strategy recommends 40 percent infill development and 60 percent greenfield development, the bare minimum allowed under Ontario's Places to Grow legislation.
When we spoke last summer, I asked Gilbert how to persuade people to change their living and transportation patterns, and he replied that he doesn't think it's possible. As long as driving remains affordable, people will continue to drive.
All cities can do is create environments that encourage walking, cycling, and public transit by making them as easy as possible. I pointed out the obvious: sprawl development does precisely the opposite. He agreed, but cautioned that that first suburbs in history were transit suburbs, served by streetcars and trolleys that carried suburban residents to their downtown jobs.
Even though newer suburbs are farther from the centre of town and have lower population densities, Gilbert referred to a study he helped conduct in the 1980s that determined public transit would be cost effective at much lower densities than it is today as long as people don't own cars. If everyone had to take public transit, there would be enough riders even in low-density sprawl neighbourhoods.
Hamilton's current GRIDS strategy assumes oil supplies will continue to grow for at least the next 25 years. Based on the best available data, oil supplies will begin to contract after 2012.
World Peak of Liquid Hydrocarbon Production by Source
In the past, this city has plunged ahead with ill-considered plans despite abundant evidence to the contrary. So far, the GRIDS process is much the same; constrained by political imperatives, like Aerotropolis, that are not up for negotiation.
It remains to be seen whether the city will continue to chase its losses in land use and transportation by ignoring Gilbert's Peak Oil Report and lunging heedless into a future where the baseline assumptions behind unlimited driving and air transport will not longer apply.
Next Issue: Gilbert's vision for a new economic organizing principle: a national leader in conservation and renewable energy production.
By adrian (registered) | Posted April 14, 2006 at 10:01:44
Hey Ryan, thanks for that link. Di Ianni sounds pretty dismissive, so I figure the council meeting might get a little hectic. I emailed councillor McHattie with a link I found while looking around on the net to give him a little extra ammo, if he needs it. http://www.airlines.org/ga/d.aspx?nid=89... "While looking for some info on the issue, I came across testimony from Robert Dibblee, Managing Director of State and Local Government Affairs for the Air Transport Association of America, Inc. He appeared before the California State Assembly in May 2005 seeking a cap on taxes on jet fuel purchased in California:" ------------------------------ During the past year, literally thousands of news stories have appeared in the media nationwide about the airline industry's continuing battle to contain costs in the face of record jet fuel prices. During the last 30 days alone, there have been more than 230 of these stories. Their headlines tell our story. ... It's a painful fact that all U.S. airlines continue to face extremely challenging economic hurdles, with few signs of material improvement anytime soon. Today, five airlines are currently facing bankruptcy. And, industry losses since 9/11 total $32 billion, with a projected loss of $5 billion this year. ... Our airplanes are generally flying full, thanks to airfares that are running at price levels equal to the late 1980's. But, they are also full of expensive fuel, the second highest business cost to airlines, and a factor that is completely out of our control. The cost of jet fuel has risen exponentially in recent years, with the current price per gallon equal to an average of $1.70, which is nearly 2 ½ times more than the average price per gallon for 2002. ------------------------------ This aerotropolis plan is ridiculous.
By David (anonymous) | Posted April 14, 2006 at 07:22:20
In discussing the effects of Peak Oil, I like the analogy given at the site www.lifeaftertheoilcrash.net, where a human body that is 70% water does not need to lose more than 10% of that before it means serious consequences. So how much of an economy has to be affected before the rest can't hold up the weight? In this concept, oil will never run out because if our system crashes, there won't be as many salaries left with which to buy the remaining oil - and their jobs will be gone because their companies ceased to exist, and it dominos down until the oil supply is no longer a concern at all.
By reidvinette (registered) | Posted June 08, 2006 at 03:15:54
June 7, 2006
The world is now at Peak Oil for the United States with the five supergiant oil fields supplying this country now in decline as of March 16, 2005. It takes one year to realize an oil field is in decline.
Beginning on March 16, 2006 the energy crises for the United States began ... or did it.
If there is an energy crises, it is a crises which has been created by the oil companies and industrial governments like the United States and Canada.
There is an energy solution to power modern day vehicles and it is called on demand water fracturing into hydrogen and oxygen.
www.waterpoweredcar.com www.waterfuelcell.org
This technology is so powerful that industrial governments are trying to keep a lid on it.
Why?
Money.
Industrial governments cannot tax the water it takes to fill your water tank in your car.
Oil companies cannot profit from the sale of water it takes to fill your water tank in your car.
Discover water fracturing technology and begin experimenting in your garage.
The energy crises I believe is a myth now.
Water fracturing technology can preserve valuable oil for petro-chemical products, and agricultural uses. Water fracturing technology can be used for vehicle transportation, and energy to power electrical generating plants now dependant on natural gas.
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