Home Quotes Contact Links Vhemt New Zealand PowerLess NZ Resources Experts Essays Running On Empty In Italiano



by Michael Cullen


Government policy is driven by the ideology of growth, not by geological or chemical facts. Read what Michael has to say.


Page 1

Page 2




by Kevin Moore


Unfortunately, not being a physical scientist, Michael Cullen has no real concept of the realities we face. I think it would be a fair statement to say that his understanding of bond energies is more or less zero, and that his understanding of spectral emission and absorption characteristics is also more or less zero.

Regrettably, most government energy policy is not set by physical scientists, but by economists, lawyers and bankers and is predicated on entirely false axioms.

For instance, we are all well aware to the government drive for biofuels, but a proper analysis of Energy Return On Energy Invested clearly demonstrates that entire concept of growing biofuels is fatally flawed from the start, since most biofuels consume more energy in production than they deliver in use. When talking about biofuels, we must also address matter nutrient depletion and ask what the sources of nutrient will be once nitrogen fertilisers become unavailable (due to the gross squandering of this nations natural gas supplies in an orgy of consumption), whilst phosphorus and potassium fertilisers will become unavailable at some stage in the not-too-distant future, due to rapidly rising oil costs and depletion of the source materials. The government would do well to note that current annual worldwide consumption of oil equates to several times the energy content of the entire vegative growth of the planet (something like a 1 to 400 ratio per year). Of course proponents of biofuels never discuss EROEI or total available energy, simply the technological capacity to carry out the process. They frequently look for government subsidies to set up pilot schemes – otherwise known as working rorts. The projected production figures for biofuels are simply laughable when compared to our energy consumption and are unlikely to ever get beyond the 2% mark.

Similarly, the hydrogen economy is a complete myth altogether, since hydrogen is simply a carrier of energy, not a source of energy (and a very poor one at that) and we have no sources of hydrogen. That does not prevent charlatans from promoting the hydrogen economy and looking for government subsidies of course. And it does not stop inept government officials who have no knowledge of basic chemistry from handing out the subsidies.

We note that the government is completely at sea on the issue of use of coal. Burning coal is the fastest way to add carbon to the atmosphere. Burning coal was never a particularly good idea, but with runaway global warming (the CO2 content of the atmosphere up around 2.5 pm last year and now causing catastrophic effects all around the globe) will be a particularly bad idea. Again, charlatans are in action, promoting ‘clean burning coal’ when in fact there is no such thing: clean burning coal is a complete oxymoron, fabricated by vested coal interests in the US to circumvent opposition to environmental vandalism. But as always, our inept government is ready to jump on the bandwagon without thinking anything though. Policy is always what suits the short term, with no consideration for future generations.

At the moment the government is placing a lot of faith in the ability to extract oil from the Great Southern Basin, but again, we know that little, if any oil will ever be extracted from that region because the cost of development and the EROEI make it extremely marginal and the physical difficulties of drilling deep in such [increasingly] tempestuous waters are daunting.

Michael Cullen’s assertion that the government has been dealing with energy issues is simply untrue. The International Energy Agency recently lambasted NZ for is deplorable lack of consistent policy on energy. New Zealand has been subjected to a series of dysfunctional energy policies since the mid-1970s and the chickens are now coming home to roost, particularly with respect to natural gas and electricty domestically, and oil, internationally.

The reality is that over the past five years or so, Dr Cullen has steadfastly resisted all efforts made by informed commentators and analysts to raise the efficiency of energy use in New Zealand. Simple measures, such as placing tariffs on vehicles with large engines, differential vehicle registration and annual taxation rates, higher taxes on fuels would have sent clear signals to the public to conserve. But Dr Cullen steadfastly resisted such initiative; his apparent objective has been to persuade New Zealanders to use as much fuel as possible in the shortest time possible, thereby not only generating massive trade imbalances, but also adding significantly to our carbon dioxide emissions. Simple measures, such encouraging the use of low powered motor scooters (by scrapping the extortionate annual tax), providing safe cycle lanes etc. Would have seen a rapid reduction in energy use and a vast improvement in the utilisation of out inner city roads. But in practice Dr Cullen has resisted such initiatives and has opted to put as many New Zealanders as possible into as large and inefficient vehicles as possible. His continued denial of reality with respect to global warming and peak oil presumably accounts for the latest announcement of yet more money to wasted on motorway construction for vehicles that undoubtedly will not have any affordable fuel perhaps as little as five years from now.

I will remind Dr Cullen that oil is now triple the 2003 price and each year that passes, the margin by which it increases in price also goes up… 25, 35, 50, 70… we should not be in the least surprised if oil is $95 or $100 per barrel this time next year, which in combination with the weak New Zealand dollar, could see petrol of the order of $2.00 or 2.40 per litre. That is of course assuming there are no major disruptions to supply. Major disruptions to supply could easily take petrol toward $3 per litre by the end of 2006.

As for accusations that my commentary amounts to scare mongering, I can only report that actual oil company production figures and IEA published data are entirely consistent with the world now having entered the bumpy plateau of peak oil. The two peak production months of May 2005 and December 2005 of 84.75 million barrels per day have yet to be exceeded over an extended time period. In fact, all data coming from major suppliers suggests that there will be no growth in oil supply over the coming year and hurricane damage will see world production of oil fall significantly within three months.

What is more significant is the very high depletion rates that are being reported from those nations that have recently peaked; annual fall-off of extraction of as much as 15% are being reported. The pittance of new production could very easily be overtaken by rapidly rising depletion within months. All this at a time when both China and India are posing serious threats to continued supply of oil to the West from numerous exporting nations from Venezuela to Iran.

The Prime Minister herself admitted as much a few weeks ago in her press statement on high oil prices, in which she agreed that we are at or about to reach peak oil and that high oil prices are here to stay. Thus we should anticipate a gradual winding down of tourism and international trade, as fuel costs become prohibitive, the very opposite of what government policy is predicated upon.
I do not expect any sensible responses from Dr Cullen on the points I have raised, since his perspective is a purely ideological one, based on economic dogma of perpetual growth that is disconnected from geological, chemical and physical realities of the world we live in.

What I do expect is for the entire house of cards economy (which is dependent on a steadily increasing supply of energy and a stable environment) to start to crumble over the coming year or so. Indeed, there are already numerous signs it has started to happen. With a balance of payments deficit hitting 8.9% of GDP (not that GDP is a credible measure of anything of course, we should be using the Genuine Progress Index), one has to wonder how much longer the international community will be prepared to finance New Zealand’s profligacy and indebtedness.


Yours faithfully

Kevin Moore
Environmental Consultant, Energy Analyst and Educator.