Technology, Not Policy Spells Doom for Oil and Gas

So says a study from the University of Cambridge that predicts a major economic crisis as a result of growing energy efficiency, and a paper from DNV.GL that calls energy efficiency "the unsung hero" of the energy transition. Interesting stuff.

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Very interesting study. It can be related to some of the stuff we are discussing on this forum (shale indebtment, doomed oil sands, EV and renewables growth...). Some people see a hurricane coming and some other are stuck to "business as usual for long".

The strategic moves some countries and firms are taking now will have tremendous effects on the way they will cope in the future.

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Yes. Total and Shell have been very, very active in going into renewables and energy efficiency, too. That can't be an impulsive decision. It speaks lots.

 

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The real technology that will be the market disruptor will be the refinement of packaged nuclear reactors in the 50 to 100 MW class.  To amplify, consider that one manufacturer, General Atomics, builds reactors for the US Navy.  Apparently they are all the same, and various ships needing more power simply add more reactors.  So you have 4 on a carrier and 2 on a sub.  The total failure rate in service of these reactors is zero. 

The Atomics reactors comprise old technology: they are boiling water reactors not much different from what was installed on the USS Nautilus about 60 years ago. The new designs now being perfected are of the molten-salt design, inherently stable and shut down automatically in case of water loss. Once that is fully proven out, you will see these reactors, and I predict down to the 20 MW size, built as drop-ins, where instead of doing on-site maintenance such as refuelling, the entire reactor is pulled and trucked off to the factory for refurbishment, and a replacement unit dropped in. You will end up with a widely distributed network of these reactors, so that even a small town of say 6,000 will have their own reactor generating plant. 

To the extent that local electricity gets seriously cheap, the push into hybrid cars will come soon enough; most of those cars will have very limited battery range,say 30 miles or so, but you really don't need much for the typical travel range of a car.  Most trips are well below 30 miles,and if the recharge is off the modular nuke plant, hey who cares? 

What this does is put the natural-gas turbine generators out of business. The gas has to go somewhere, so I predict gobs of it will go to the manufacture of methanol, which in turn will be a drop-in fuel substitute for diesel and gasoline. More gobs will go to the manufacture of plastics monomers.  It will be oil that starts to get crowded out.  And the areas where oil will no longer be sourced will be those with economic and political instabilities.  Don't be surprised when big chunks of the Middle East get abandoned. Will they go back to feudal States?  Nomadic tribesmen?  Who knows? But don't discount the possibilities out of hand. 

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