Energy: The Time Frame for the Transition to Renewable Sources and the Question of European Power

For quite a considerable time now, scientists and economists have been debating the question of the possible depletion of the traditional (socalled non-renewable) energy sources that constitute the basis of the global economy and are the irreplaceable driving force behind growth in the developing world. Given the clear nature of these resources (oil, gas, coal, uranium) — they are “non infinite” and non renewable —, the debate, which has now reached the mainstream media, focuses on two crucial and inter-related questions: a) How many years or decades can we reasonably expect to elapse before these energy sources are completely depleted? And b) What technical and financial resources will have to be employed, and in what quantities, in order to develop economically acceptable solutions based on the use of replacement “renewable” sources of energy, such as photovoltaic solar systems, hydrogen, fuel derived from agricultural products, etc. (and again, what time frame are we looking at?). This is a debate that is unfolding alongside and often overlapping another dramatic issue facing today’s world: the risk that the continued and indiscriminate consumption of fossil fuels, and the consequent increase in the gases responsible for the greenhouse effect, might worsen dramatically, maybe irretrievably, the conditions of life on our planet.
It is over this question of the “time” that remains in order to complete this transition that the experts are divided. The first scientific studies aiming to identify the production-consumption ratio (albeit with reference only to oil) date back to the mid-1950s and to the work of American geologist M. King Hubbert who, based in the laboratories of Shell Oil in Houston, calculated that production of crude oil in the United States would peak (hence the term Hubbert’s peak) at the start of the 1970s, after which it would, gradually and inexorably, decline. With the benefit of hindsight, we know that Hubbert’s calculations were correct and that the USA’s oil production peak did, indeed, come in 1970. Hubbert himself, and others in his wake, endeavoured to extend these analyses and to work out on a global level how long it would take for energy sources to run out completely. Obviously, enormous difficulties were encountered in the course of these latter studies (compared to those conducted in the United States, where the data available had been reliable and plentiful), on account of uncertainty over (or partial ignorance of) the real extent of the world reserves. At the end of the 1980s, for example, many of the leading OPEC oil-producing countries reported sudden increases in their proven oil reserves but failed, however, to supply details that would have allowed these figures to be verified. Leaving aside the more technical aspects of these studies, which were nevertheless based on solid (albeit prevalently statistical) scientific methods, what must be underlined here are their conclusions, which, to a great extent, highlight that the “supply/demand” ratio for oil will reach its “highest point” sometime in the next ten years.
Conversely, we also read of more optimistic predictions that indicate a time at least twenty or thirty years hence, or that even hypothesise, as Leonardo Maugeri says in his recent book The Age of Oil (Westport, Ct., 2006), that there exist in the earth’s subsoil as yet undiscovered reserves of oil, including “unconventional oils” (which will be exploitable thanks to improved extraction technologies, rendered profitable by hiking prices), sufficient to postpone the point of depletion to some far-distant and indefinite time, making — at least for the foreseeable future — the very concept of the “peak” seem absurd. What we are faced with here is a complex equation, influenced by a great many scientific and technicaleconomic variables, not to mention purely political factors. It is thus not unreasonable to give credence to the more cautious and now generally accepted hypothesis and to accept that there does, in fact, exist a “time” in which energy sources will start to run out and that this time will come within the next twenty, or at most thirty, years. Remarking on the global crisis deepened by the events of September 11, 2001, George Soros, founder of the Open Society, writes (The Age of Fallibility, New York City, 2006): “The core of the crisis is the tight supply situation of oil. The reasons are partly secular and partly cyclical. The secular factor is that oil consumption regularly exceeds the discovery of new reserves.”
* * * As seen with other crucial events in the history of mankind, whereas science may anticipate new problems and offer possible answers, its falls to the world of politics to take the necessary decisions and to act. As recalled above, experts (scientists and economists) have long been pointing out both the problem of the finite nature of energy sources and the various energy-related environmental problems, most of them predicting that the relative crises will manifest themselves in a not too distant future. Equally, technology has developed some possible answers to these problems, which are now well known (recourse to renewable energy sources), and in some cases, thanks to technological innovation, valid solutions already exist. But the world of politics seems incapable of responding with the necessary speed and determination. As Colin Campbell wrote in 1997 (The Coming Oil Crisis, Brentwood, Essex): “In an ideal world, governments would properly study the resource base and understand the principles of depletion. They do not, and in democratic societies cannot, because they are elected for short terms and are therefore motivated to deliver short-term benefits to their electors. As a consequence, it is most unlikely that the governments of either the United States or the European Union will adopt an energy policy with the aim of preparing for the inevitable peak in oil production and subsequent scarcity.” Ten years on, nothing has changed. George Soros, in his book, cited earlier, drew attention to the recurrence of certain, sporadic crises (pirates in Nigeria, hurricanes in Texas and in Louisiana, the exacerbation of the conflicts in the Middle East, for example) that, once they are ultimately resolved (or, rather, dampened), result in an increased availability of crude oil and a relative reduction in oil prices. His point was that these situations fail, in the medium- to long-term, to alter substantially the oil depletion curves, and in fact “may sap the political will to deal with them; indeed that is what happened after the first energy crisis in the 1970s. It is liable to happen again.”
In truth, and shamefully late in the day, some governments have now raised this question and launched their first tentative initiatives. Unsurprisingly, the United States were the first to tackle the issue publicly. In his State of the Union address on January 31, 2006, President Bush, after declaring that “America is addicted to oil,” undertook to set up a vast programme of investment and research into renewable energy sources, the aim being “to replace more than 75 per cent of our oil imports from the Middle East by 2025.” Further details and further undertakings were contained in the 2007 State of the Union address. Even in Europe, on a political level, we can now observe a growing realisation — albeit more gradual and confused than in the United States — of the fact that we have to tackle the question of our dependence on non-renewable energy sources, introducing long-term measures designed to make alternative sources of energy available and economically viable. Since it was obvious from the start that most of the EU states were not destined to get very far tackling the problem purely at national level, efforts were made to develop a collective approach. This led, in 2002, to the publication of a European Commission “Green Book” on the issue. This is an ongoing debate that, however, is inevitably conditioned by the substantially “confederal” nature of the Union, which — leaving aside the many declarations of principles, for example on the desirability of creating a “European Environmental and Energy Agency” — makes it entirely predictable that the responsibility for carrying out any plans decided at European level will be passed on to the individual states; indeed, this is what is already happening.
At this point, we can draw a few conclusions: the scientific and technological instruments needed for an effective “global” solution to the energy problem exist, and they presuppose the development of a system based mainly on a combination of different renewable sources; but it is inconceivable that these resources will be available under economically acceptable conditions before the second or third decade of this century (President Bush has talked of 2025), and even then, only providing the political powers have, in the intervening years, taken the decisions (major investments in research, more extensive and safer use of nuclear power, legislation to encourage the use of renewable sources, extensive campaigns to raise awareness of the need to save energy, etc.) that will allow the transition from the “theoretical” (scientific) stage to the stage of economically sustainable “industrial” realisation, as well as the start of a process of environmental recovery of our planet.
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But this will not suffice. While effective political initiatives undertaken today may solve the long-term problem, the world of politics cannot disregard the equally serious problem of the “transition period”, that is, the problem of the “short to medium term.” In the short to medium term, it will not be enough simply to prepare for the future (developing renewable energy sources); it will be a question of striving to survive on the resources that are currently available. In other words, it will be necessary to establish a world “balance of power” that will allow a fairer and more rational use of the resources that, although dwindling, still exist (oil, gas, uranium, etc.), and without which the economic development of the various countries, in particular the most backward ones, would basically grind to a halt, having economic and political consequences that are all too easy to imagine.
It is not only a question of preventing deteriorations of the crisis situations, or even the situations of outright war, in the world, particularly in the areas where these resources are to be found (the Middle East, central Asia, Africa); it is also one of creating the conditions in which it will be possible to set in motion a sort of “virtuous cycle” that will help to foster their progressive — and not impossible — pacification. Today, on the other hand, the geopolitical choices of the world’s leading powers tend to aggravate these crisis situations. In particular, the United States (despite, according to Bush, planning ultimately to break its dependence on Middle Eastern oil) is well aware that, in the short to medium term, it is not in a position to do without the oil it receives from Saudi Arabia, the United Arab Emirates, Kuwait, and other countries in this region, and (using its claims that it is “exporting” democracy and striving to counter the threat of terrorism as an ideological cover for its real political and military objectives) is endeavouring to strengthen and develop controlling positions in the Middle East, in central Asia, and now in Africa. China, for the time being at least, appears to have opted for a “softer” (and more positive) approach, partly on account of its currently lesser capacity for direct intervention. Indeed, the policy China has begun to implement is based on the building up of contacts (mainly established through diplomacy and enriched through its provision of economic aid) with many of the oil-producing countries in Asia, the Middle East, South America, and Africa. These are moves that, while falling within the sphere of traditional “power policy games,” could well lead to “escalations,” and create a real risk of a serious degeneration of the situation — and whether this occurs will depend on the extent of the transition, already under way, from a unipolar to a bipolar (USA and China) world political order. There have, indeed, already been signs of such an evolution of events — signs which should not be ignored. In January, China fired a ballistic missile that successfully destroyed one of its own weather satellites located more than 800 km above the earth’s surface. A spokesman for the Chinese Ministry of Defence was quick to stress that it was not China’s intention to engage in an “arms race” in space. But as The Economist pointed out (January 27, 2007 “Stormy Weather”): “it is hard to see the test other than as a display of China’s ability to challenge American space power.” And indeed the move certainly prompted nervous reactions from both the US administration and America’s allies in Japan and Taiwan. Meanwhile, the United States’ recent decision to encourage the intervention of Ethiopia (its ally) in Somalia and to create a special military command for Africa, must be viewed from the same perspective (that of a potential “confrontation”).
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In this whole scenario of global geopolitical relations, the major European countries, too, are looking for a role to play. Germany, in particular, as revealed in a recent German Foreign Ministry document (info@german-foreign-policy.com), seems to be focusing on the possibility of establishing a special relationship with Russia through an agreement that would even extend to military collaboration, making provision for the joint deployment, in areas as yet unspecified, of “stabilisation” forces. The European Union, on the other hand, is nowhere to be seen, since, not being a real state, it lacks the normal instruments for intervention in international affairs, namely, a government that can express a single foreign policy and that has at its disposal not only a political but also a military apparatus, as well as sufficient financial resources to pursue a policy of support and alliance vis-à-vis the oil-producing countries.
Before moving on, let us get a possible misconception out of the way: whenever we mention the possibility that a “European power” (a European federal state) could intervene (in the Middle East for example) in order to protect its own interests, employing all the instruments of socalled power politics, we should not make the mistake of envisaging a return (now quite impossible) to Europe’s colonial past, with its gunboats and landing parties. Instead, we should think back to the events of October 1956, when British and French (and Israeli) troops attempted to occupy the Suez Canal following Egyptian president Nasser’s decision to nationalise it. To halt the Anglo-French campaign, the US president, Dwight Eisenhower, did not have to send in US troops (he sent in only an aircraft carrier as a token gesture): all it took to make the governments of France and Great Britain see reason was a telephone call to the British prime minister, Anthony Eden, in which the American president threatened economic sanctions against them (the sale of US treasury reserves of sterling and French francs) should they fail to withdraw. Let us try to imagine what might have happened had a European federal state (a European federation) existed in 2003, at the time of the sudden deterioration of the Iraqi crisis. The federation’s president (or his or her delegated representative) would have discussed the situation with the US president — on an equal footing, as is possible only between sovereign states —, “recommending” that he persevere with the United Nations’ inspections programme, or with other diplomatic endeavours, and at the same time making it quite clear that should America persist in its unilateral and bellicose approach, the European Central Bank would have no hesitation in selling the US treasury bonds in its possession. One might say that this is the stuff of political fiction; indeed it is, given that no European federal state as yet exists. But we have to imagine concrete courses of action in order to appreciate fully the very real and positive opportunities that the founding of a European state entity could present. In the absence of a European federal state, however, it is the nationstates that take the initiative, as in the case, mentioned earlier, of Germany and its return to an “ost-politik” approach in its dealings with Russia. From a federalist perspective, we should not find these “nationalist” choices particularly surprising. Whether we like it or not, and this applies to Germany and the other European states, the governments’ instruments (limited as they are) of political power still lie in the national framework and it is only to be expected that, in emergency situations, they will try to use them to defend, albeit partially and rather ineffectively, the interests of their electorate. The German government, like the French and Italian governments, are faced with the problem of ensuring that energy supplies, from Russia, Algeria, Iran, or elsewhere, are not suddenly interrupted, and even though they can see that a common (European) line would be beneficial and are indeed willing to set up cooperation agreements (by definition intergovernmental) to this end, they still employ all the national political instruments at their disposal, over which they have direct control (and for the use of which they are answerable to their electorate, in accordance with the principles of democracy), in order to guarantee that their own citizens will not suddenly find themselves without hot water, petrol or electricity. The result, of course, is choices that are contradictory and short-sighted, and that tend to create tension between the European states, even threatening to undermine the very balance of power underpinning the Union. A recent case in point has been the planned gas pipeline under the Baltic Sea (now under construction), which will allow Russian gas to reach Germany directly, circumventing Poland. At the same time, given the current framework of power in Europe, they are the only choices the states can make. Instead, it is obvious that a Europe bound together as a state, that is, as the federation envisaged by Altiero Spinelli on Ventotene and by the founding fathers of the European Communities in the 1950s, would be in a position to guarantee the European citizens real protection. It would fall to the European federal state, which would be equipped with the necessary instruments, to start negotiations with Russia — again, negotiations conducted on an equal footing between sovereign states — in order to secure just conditions that would guarantee continued supplies not only for Germany but for all the states in the federation. Equally, a European federation that were part of a broader confederal Union would have not only the power, but also the natural inclination to protect the interests of the Union’s other member states.
Furthermore, a federal state (and only a federal state) would be ideally placed to promote and initiate, possibly through the United Nations, the “grand bargain” that is now widely felt to be absolutely essential in the Middle East if this area, which is in such close proximity to Europe, is to find a way out of the vicious cycle in which it is caught (the roots of which can, to a great extent, be traced back to the choices made by the Europeans at Versailles in 1919). In this way, Europe would be able to protect the legitimate interests of its own citizens, ensuring, for itself, fairer and better regulated access to the energy supplies it needs, at least for the inevitable transition period; but, more than this, it would also be able to promote a genuine “multilateral” peacemaking policy, feasible through recourse to diplomatic instruments and the launch of a serious programme of economic aid, thereby making its interests coincide entirely with its duty — the moral duty that derives from its acknowledgment of the wrongs of its colonial past.
There is clearly a risk, partly due to objective circumstances, that these choices will run counter to the interests of the United States (and, up to a point, of those of the other world powers); however, a Europe equipped with its own state apparatus (federal and not centralised) would be able to exercise true sovereign power, but a “softer” version than the prevalently military power wielded by the United States. It could, for example, give serious consideration to Iran’s proposal to set up a new oil and gas “exchange” where transactions would be made in euros; but, at the same time, it would be in a position to insist that Iran, in return, acknowledge the existence of the state of Israel, and also to promote direct negotiations between Palestine and Israel that might culminate in the two states’ acknowledgment of each other, in the definition of undisputed and clear borders, and in a system of international guarantees in which the European state, the United States of America (and possibly China, India and Russia, too), and the regional powers would all play a part, thereby paving the way for a not impossible de-nuclearisation of the whole Middle Eastern area.
But all this hinges on the founding of a “European power” — a continental state that, albeit initially without the level of military capability of other continental states, would nevertheless be able to make its presence felt in the framework of international relations. The present European Union does not have the power to do this, and neither will it have should the Constitutional Treaty — certainly useful from the perspective of more efficient management of the EU’s confederal configuration — be approved, be it in its current state or after the possible minor modifications that would do nothing to alter its decision-making mechanism or enable it to exercise sovereign state power. Time is running out. The energy crisis (and the equally alarming environmental crisis) are already under way and the scientists and economists have long since worked out their formulas, clearly pointing out the unavoidable alternatives facing Europe and the world as a whole. It could be that the oil peak will not come before 2025, as President Bush seems to think, or before 2030 (or even later), and perhaps the squaring up between the emerging Asian powers (China in particular) and the United States will be kept on a mainly diplomatic level. But what is certain is that all the leading players on the world stage — those that exercise sovereign state power — are already at work, not only to find more long-term solutions, but also to safeguard their interests in the face of the deadlines of the short- and medium-term period (the period of transition). Meanwhile Europe, conditioned by its own division, could soon find itself substantially in thrall to external powers, making the scenario that Luigi Einaudi hypothesised and, in vain, warned against over fifty years ago, seem closer than ever.

The Federalist