Not to denigrate the importance of global warming, but, for now, the economy is so intimately connected to burning oil, it is as certain as any economic prediction can be that, if there is an "oil shock" there will be a deep global recession, and maybe a global war.
We're not ready for the end of the oil age. For an idea of what it will cost to get off oil, add up all the oil capex that got us here. Now spend that on something else. That's just not happening.
The alternative to this is a construction and market boom unlike anything we've had since the industrial revolution as we adapt to a world without plentiful "cheap" oil.
I'm not so pessimistic to think that this will automatically end in a global war or even necessarily a global recession in any case it will be an interesting time to be alive.
It's good to be optimistic, but the problem is that everything needs oil to be made and to move. Once demand can't be met, all parts of the economy bid against each other. Many people won't be able to drive to work. Many factories will not be able to make things at affordable prices and will shut down. Food will be vastly more expensive. Fertilizer is made of oil. Many more people will fall out of the middle class. Tens of millions of people, or more, will starve.
The overall economic result will be stagflation and there will be nothing that can be done with the spend, tax, or money supply levers. Less oil means a shrinking economy.
Energy is wealth. It took over 100 years to build this oil-based economy. We have 20-60 years left to get off oil. If we do not start a production line to mass-produce safe nuclear power plants and find a way to safely reprocess the waste, soon, it isn't going to happen in time. We spent trillions on wars and on bailing out an insane derivatives market. Will we have the capital to switch away from oil?
> It's good to be optimistic, but the problem is that everything needs oil to be made and to move.
No, lots of things are currently manufactured using oil and moved with oil because it's relatively cheap.
> Once demand can't be met, all parts of the economy bid against each other.
When the price for oil goes high the different alternatives begin to look viable which partially offsets this (one example, electric cars become far more viable when oil is twice the price it is now).
> Many people won't be able to drive to work.
Average person already commutes to work less than the distance a current gen electric car can commute comfortable plus working habits change, remote work, live nearer to work.
> Many factories will not be able to make things at affordable prices and will shut down.
Rising energy costs increase the price the end consumer pays if those items then cost more than people are willing to pay the product stops been made, this is the nature of markets.
> Food will be vastly more expensive. Fertilizer is made of oil.
Not sure why as we don't make fertilizer from oil, we make fertiliser from methane (natural gas usually) which is used to fix the nitrogen from air (NH3) which is the primary precursor for NH4NO3 (Ammonium Nitrate), the only time ammonium nitrate and oil meet is if you want a bang (ANFO).
> Many more people will fall out of the middle class. Tens of millions of people, or more, will starve.
No evidence for this either way to be honest.
> The overall economic result will be stagflation and there will be nothing that can be done with the spend, tax, or money supply levers.
Alternatively the massive push to restructure the economy towards a post oil future will create huge new markets and foster massive investment into non-oil power sources (batteries, nuclear, renewables) much like move to coal did in the 19th century and oil in the 20th.
> Energy is wealth.
Arguably you could use units of energy as a form of wealth but you know what we can extract more energy than we do right now world wide and never have to burn a drop of coal or oil, We have vast untapped reserves of nuclear fuels (the low ball estimates of a few centuries are largely because no one has looked since we had enough).
> It took over 100 years to build this oil-based economy.
Not really, it's been over a hundred years since we have had an oil-based economy the actual usage of oil boomed over a 15-20 year period in the early 20th.
> We have 20-60 years left to get off oil.
We (might) have 20-60 years to get off oil if we continue to consume it at our current rates, the price will go up as supply goes down, alternatives then become viable (nuclear and PV are not that far off on a kW/h basis already over their lifespan).
> If we do not start a production line to mass-produce safe nuclear power plants and find a way to safely reprocess the waste, it isn't going to happen in time.
Define "in time" - http://en.wikipedia.org/wiki/File:Electricity_in_France.svg France went from generating a third of their electricity needs to 75% in under 20 years, they now generate 40% of their entire energy consumption from nuclear.
As for the waste problem that is largely solved with modern designs, old plants where dirty they where dirty because the technology was less developed and because they where designed to produce nuclear material for weapons, We can and have built plants that use their own waste as a useful by product produces vastly less waste.
> We spent trillions on wars and on bailing out an insane derivatives market
The US spent trillion on wars and on bailing out the insane derivatives market but you know what the biggest producer of PV panels and nuclear plants isn't the US...
> Will we have the capital to switch away from oil?
Yes of course, given raw materials and energy we can move from oil.
Will a "post-oil" society look radically different to the one we have today probably and in ways I can't even begin to imagine but it's not a death knell for the human race (in fact getting off burning that crap for energy on the whole will be a good thing...the irony is we might stop fucking up the planet (in terms of CO2 emissions) purely because we no longer can.
As a european socialist by inclination it's ironic that I think the solution is largely going to be market driven but hey whatever works.
One ( flawed )way to look to general fossil fuels is that they basically replaced ... slavery/peonage/unfree-peasant-try. That may not have been the only way, but it was in (low-resolution, crummy, more-or-less) fact what happened.
And spend the oil capex on what, exactly? Alts? If someone had a really good story on alts, they'd be trying to be the Emperor of alts, not just sitting there. Margins in oil stuff aren't good and it's got a lot of flywheel in skills, infrastructure and distribution. Spend a weekend driving around on the Eagle Ford shale some time.
Oil equipment uses solar panels because it's used close to off the grid. It's not like they don't know about it.
About the only thing that's mature and could scale-up quickly enough is nuclear, and even that will take new-generation plants and new fuel cycles to escape the cost, safety, and waste problems of current nuclear plants. And we are starting with an inventory of nuclear plants that need to be replaced even before new nuclear capacity can displace oil. I'm certainly not trying to minimize the problem of switching away from oil.
We're not ready for the end of the oil age. For an idea of what it will cost to get off oil, add up all the oil capex that got us here. Now spend that on something else. That's just not happening.