“The era of cheap and abundant energy is ending”

• Scientist and disseminator Antonio Turiel presents with the JHU-UPF Public Policy Center and UPF-BSM the study The energy crisis in today's world: analysis of the World Energy Outlook 2021

“The era of cheap and abundant energy is coming to an end”, this was the warning given by the CSIC scientist and disseminator, Antonio Turiel, in the presentation of the study The Energy Crisis in the World Today, organized by Johns Hopkins University - Pompeu Fabra University Public Policy Center (JHU-UPF Public Policy Center) at UPF Barcelona School of Management (UPF-BSM).

This is the first act of the new stage of the JHU-UPF Public Policy Center with the UPF-BSM, which has opened with the words of David Sancho, Deputy Vice-Rector to the Rector of Pompeu Fabra University (UPF), who has underlined that “the debate around public policies and collaboration between universities is very important. The JHU-UPF Public Policy Center opens a framework for debate on the best policies to open up avenues for improvement in highly complex contexts. UPF has a vision of the future of addressing social and political problems from the perspective of planetary wellbeing. This vision is a good way to deal with problems as complex as the one we are dealing with today, and the JHU-UPF Public Policy Center is a clear example of this.”

The Director General of UPF-BSM, José M. Martínez-Sierra, also spoke, saying that “it is an honor that our school can contribute a grain of sand to this project. I want to recognize and value the fact that two institutions such as UPF and JHU have agreed to create and promote an institutional relationship in a transatlantic and global center, this does not happen every day”.

Likewise, the introduction was attended by Josep Lluís Pelegrí, Director of the Institute of Marine Sciences (CSIC); Keshia Pollack Porter, Co-Director of the JHU-UPF Public Policy Center and Joan Benach, Co-Director of the JHU-UPF Public Policy Center, who recalled that “the energy crisis is still little known, a critical debate on this subject is needed and that is why the JHU-UPF Public Policy Center addresses it in this act and with the study that we present today.”

“Russia is the only country in the world that has accepted that its gas production is going to decline and this explains a lot why it does what it does"

Getting into the heart of the matter, Turiel has reviewed the recent past that has ended up leading to the current situation: "The great disinvestment in which the oil companies, which had multiplied their upstream effort by three from 1998 to 2014 , they have decreased by 60% since then." This happened, according to the scientist, because "in July 2014 the US Department of Energy reported the formation of an oil bubble in which these companies were losing a lot of money and with the Brent barrel prices at all-time highs.”

According to the Turiel study, the International Energy Association (IAE) in 2010 recognized that the peak of oil production occurred in 2006 and would never rise again. In 2012, the entity recognized that conventional oil production is already falling, while non-conventional oil (biofuel or fracking) is more expensive and companies stop investing in it. In 2018, the IEA warns of several oil price peaks until 2025: in its forecasts there is a 34% imbalance between oil supply and demand. And we reach 2020, when they warn that oil production may fall precipitously until 2025. "The only way to avoid the worst scenario is with an abrupt renewable transition," says Turiel, noting that at that time "for the first time , gas is also declining” and states that “Russia is the only country in the world that has accepted that its gas production is going to decline and this explains a lot why it does what it does”, in relation to its invasion of Ukraine.

In this context, we are seeing a rapid decline in gas oil production and a sharp drop in diesel, because of the lack of quality oil. And this also happens with coal, whose production rose until 2014, and with uranium, which peaked in 2016 and has already fallen by 20%.

"Obviously, in the long term we will have to base ourselves 100% solely on renewable energy, but this 100% energy will not be the same amount as now"

“We have the renewable transition. Obviously, in the long term we will have to base ourselves 100% solely on renewable energies, but this 100% energy will not be the same amount as now”, warns the expert. According to Turiel, “renewable energies have many limitations: maximum potential, dependence on scarce or raw materials…”

“The IAE knows that it is impossible and recommends hoarding certain critical materials to satisfy transition plans. In order to reach a clean transition in 2050, it is necessary to multiply the production of lithium by 100% and 40% of other materials. The prices of these materials are rising critically due to the lack of energy to produce and treat them”, explains Turiel.

As a conclusion, Turiel has made forecasts of trends in the short and medium term “all aggravated by the war”: “There will be a worsening of the food crisis due to the lack of fertilizers; there will be a shortage or rationing of diesel; extension of electrical blackouts due to the need for gas for the electrical network; decrease in international trade, due to higher diesel prices; scarcity of raw and processed materials -the chip crisis will last until 2025-; greater conflict with transportation and the primary sector; higher inflation and lower income; revolts in countries where food does not arrive; growing authoritarianism and perhaps ecofascism and neofeudalism.”

"Another energy transition is possible with more efficient and local sources, but more traditional and less technological, which implies giving up infinite growth"

To close the session, Turiel predicted that “another transition is possible. The most efficient and desirable transition model is much more local and less technological, doing things very differently, harnessing energy in more traditional and less technological ways. But this implies giving up infinite growth and is contradictory to the dominant economic theory”, he concluded.