Implications of Global Oil Depletion

for Transport Planning

in South Africa

Jeremy WakefordResearch Director

Association for the Study of Peak Oil SA

South African Cities Network

Sustainable Public Transport Seminar

15 August 2008

2

Outline

• Introduction

• Global oil depletion

• Alternative transport fuels for SA

• Implications for SA transport & planning

• Conclusions

Introduction

• Transport planning traditionally rests on

demand projections

• This assumes cheap & plentiful fuel (oil)

• Evidence suggests global oil production

might peak & decline within a few years

• Business-as-usual will no longer be

feasible3

4

A World ‘Addicted to Oil’

• Oil provides:

– 35% of total energy supply

– 95% of transport fuels

– inputs for industrial agriculture

– petrochemical feedstock

• Demand is surging in China & India

Source: International Energy Agency

5

6

40 yrs

Source: ASPO Ireland

Oil Production in Europe

7Source: Energy Watch Group (2007)

Source: ASPO Ireland 8

Oil Producers Past Peak

9

Source: Energy Watch Group (2007)

World Oil Production Forecast

10

Source: Energy Watch Group (2007)

World Oil Production

11

World Liquid Fuels Supply

12

Peak Oil Exports

• Consumption growing in leading exporters

• World oil exports set to decline soon

13

Alternative Energy Sources

• Unconventional oil has low net energy

• Coal is polluting & may peak by 2025

• Natural gas supplies are already very tight

• Biofuels threaten food & water security

• Nuclear electricity is limited & risky– uranium may peak by 2020

• Renewables produce electricity

• All viable alternatives require time & money to be scaled up

14

15

Alternative Technology

• Replacement of current inefficient vehicles will take many years and $ billions

• Costs of new infrastructure are soaring

• Fuel prices will have to rise high enough to destroy demand

16

Hirsch Report to US DoE (2005)

“The peaking of world oil production presents the U.S. and

the world with an unprecedented risk management

problem. As peaking is approached, liquid fuel prices

and price volatility will increase dramatically, and, without

timely mitigation, the economic, social, and political costs

will be unprecedented. Viable mitigation options exist on

both the supply and demand sides, but to have

substantial impact, they must be initiated more than a

decade in advance of peaking.”

Source: IMF 17

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Likely Consequences

• Supply/demand crunch Rising oil price & volatility Fuel shortages Rising inflation & interest rates Recession & growing unemployment Food insecurity & social instability Financial crash? Resource wars?

Oil Dependence in SA

• Petroleum = 97% of transport fuels

– ± 63% imported

– ± 30% Sasol (coal-to-liquids)

– ± 7% PetroSA (crude & gas-to-liquids)

• Transport heavily dependent on roads– 80% of freight– 95% of motorised passengers

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Domestic Fuel Supply Options

• Sasol might expand CTL to 50% of SA’s fuel needs by 2014

• PetroSA’s gas reserves are rapidly depleting

• Even if there are new off-shore oil & gas fields, they will take 7-10 years to deliver

• Biofuel target is 2% of liquid fuels by 2013• Electricity supply is already constrained• Hydrogen is a net energy loser

20

Likely Impacts

• Further rising fuel prices

• Fuel shortages within a few years

• Rising costs of new infrastructure & road

maintenance

• Falling demand for new road vehicles

• Reduced traffic congestion & pollution

21

22Source: SAPIA

23Source: SARB

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Implications for Transport

• End of ‘mass’ air travel

• Decline in private car use

• Wealthier will switch to hybrids, electric & compressed air cars; electric bikes

• Growing demand for public transport

• Non-motorised options more popular

• Changing land use patterns– urban densification

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Fewer of these...

26

... more of these...

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...and perhaps even:

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Transport Vulnerabilities

• High dependence on imported fuels & road transport

• Inadequate public transport

• Aged railways & rolling stock

• Geographic distances, stranded townships & suburban sprawl

• Poverty & unemployment

• Taxi industry a potential flashpoint29

Opportunities

• AsgiSA infrastructure programme

• Transnet capex programme

• 2010 World Cup funds

• NATMAP

• New niches to exploit– electric vehicles– renewable energy

30

Principles for Transport Planning

• Sustainability

• Energy independence

• Improve efficiency & conserve

• Prioritise fuel use– food production & distribution– essential services

• Promote public awareness & cooperation

• Manage taxi industry carefully31

Transport Energy Efficiency

32Source: http://openlearn.open.ac.uk/file.php/1697/t206b1c01f49.jpg

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Transport Policies

• Reduce road speed limits

• Mandate higher vehicle fuel efficiency

• Improve traffic management

• Expand public transport– enhance safety & security

• Promote non-motorised transport– cycle lanes, pedestrian walkways, safety

• Ration liquid fuels

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Conclusions

• Peak oil is inevitable & imminent

• Energy supply constraints & higher fuel prices will drive transport options

– on both supply & demand sides

• The sooner we prepare, the better we’ll manage the transition

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Thank you.