MyWorld 2050 - GIGO in action

The UK Propaganda Department of Energy and Climate change has released their energy policy toy, called MyWorld 2050.

The idea is to let people play around with energy supply, like fossil fuels, nuclear and alternatives, and then match this with the demand coming from industry, housing, heating, transport and travel.

The goal: get to 80% CO2 reductions by 2050.

You can try the model yourself at the MyWorld 2050 web site.

Now, some issues that the model behind the game doesn't lay bare:

• There is extremely low probability that oil will flow at 50% of current levels in 2050. There just are not enough resources, drill holes, tankers and manpower.
  
• Not using fossil oil creates a liquid fuel problem, which the model suggests one fix with biofuels. The problem is that the model assumes we can burn the rest of the developing world's (who have all the money, btw) food for fuel. And the model further assumes this will reduce CO2 emissions and be net energy positive. The premises behind that logic are faulty.
  
• Clean coal and gas power are supposed to give a 15 point CO2 cut. Eh, where exactly do we have clean coal? And oh, the North Sea gas is mostly in decline by 2025 (remember the model is originally for UK).
  
• Hydrogen cell powered cars. Sigh, that's like selling second order financial derivatives on a lollipop you have already eaten. Most sane thinkers thought we we past that already.

What the system does underline, is that it is impossible to not to have a liquid fuels problem, unless one goes all out on biofuels overseas in developing nations. What the system doesn't tell is that there is no arable land left to do this, unless we take it from food production or burn down the rainforests.

And all this is done with extremely low demand scenario, where people will be living in 16C temperature homes and travelling very little privately, doing mostly car sharing and public transport.

Good luck selling that scenario to the ignorant masses at large.

The more technically minded can download the 2050 Pathways Excel spreadsheet (Office 2010 format, thank you DECC idiots) that reveals some of the thinking behind the model.

Food vs. Fuel war brewing

Many people and institutions have warned about the coming fight between biofuels and food for arable land.

Even the mainstream media in Europe and USA have been hammering the message in lately: first generation biofuels from edible crops is brain dead idea. Further, even non-food biofuel crops may compete with food crops for the same acreage.



When biofuels compete with food production, what happens?

• Price of wheat goes up => bread and other basic food items increase in price
  
• Price of corn goes up => processed food prices increase
  
• Price of soybean goes up => beef becomes more expensive
  
• Price of barley increased => Price of beer goes up
  

At this point the astute reader has understood the underlying reason why the price of food and energy has been cleaned from the most common inflation index, even though those represent a major inelastic part of everyday consumption.

When you combine this with the fact that per capita global food production has already hit a peak and is at is currently lowest in 50 years, there is a possibility of a big political storm brewing.

Again, the poorest nations will take a hit first: when oil is too expensive and critical for infrastructure (incl. electricity production) and price of bio-fuel crops go up, then edible crops are abandoned for more lucrative crops.

Fortunately, some developing nations have already understood the precarious balance between food and fuels. China's ban on use of corn for biofuel could be a sign of things to come elsewhere.

However, the ever inventive market is now showing signs of turning to other sources, like fruit. This does not solve the problem, merely shifts it around.

Food into fuel drives up the world prices of most major food crops, making it increasingly more difficult for poor nations to solve the edible crop shortage through costlier imports.



So, what happens? People starve. Nothing new there.

And in the end, we accept it, because it calms the markets and lets us think we can compensate for the plateauing crude oil production with biofuels, which in turn enables us to keep running our economies, planes and cars.

So, we keep on producing unsustainable biofuel types, even if it reduces edible crops on the market and drives up the food prices.



However, if the situation gets dire enough, through an added shock to the system, like a massive serious of world wide droughts for example, then even biofuels could become too expensive for us, while food prices remain high.

What drives this apparently risky development?

Sane or not, the advance of biofuels is driven by various forces:

1. Our relentless and growing consumption of oil
   
2. Urgent need for greenhouse gas emission reduction
   
3. Strong lobbying for subsidies and associated (American) political alignment
4. Increased insecurity about energy (read:oil) security: not enough production is local
   
5. Growing nervousness about supply of oil refinery products
   
6. Still expanding green tech & biofuel business boom

So, it looks like biofuels we will get and food less so.

Will this tension between fuel and food production result in a crisis or local political instability as predicted?

Let's look at what the magic 8-ball says:



Ah well, till the next time