Energetic Pivot

Guest Editorial

Aaron Holmes

Tuesday, March 22 2016

Compared to a place like the Saudi Arabia, the oil here is expensive to produce.

At these prices companies lose money on every barrel they produce.

The way the economics shakes out, with fixed and marginal costs companies could lose more money if they stop producing. So production, and losses continue.

Pipeline advocates seeking access to tidewater for our hydrocarbons are stuck on old talking points. We’re not a low cost producer, so we’re at risk of the busts associated with a flooded market.

Money spent on a pipeline will pretty quickly become a stranded asset, another fixed cost that perpetuates the status-quo at exactly the moment when we need to pivot.

No pipe can make losing money on production profitable. Instead, let’s limp along with rail until we can reorganize around clean energy, where the marginal cost of production is virtually nil.

If our time and effort were instead focused on big wind, small solar, and energy conservation the oil price collapse wouldn’t matter.  There would be lots of interesting jobs maintaining wind turbines, installing rooftop solar, doing energy-saving renovations on houses.

We can solve our energy problems without resorting to being hewers of wood. We don’t need to ship beaver pelts back to the empire either. We’re more than our natural resources, and we have the initiative, ingenuity, and industriousness to make it happen.

You don’t miss beaver-trapping, and you won’t miss driving apartment sized dump trucks. We’ve got better things to do,  like buying six sea-cans of solar panels from China and cooking up a deal with some housing developer. Before someone else does.