Thoughts on a Thought Experiment

As I indicated in the original post – Coping with Gas at $100 a Gallon – here are some of the comments on my thought experiment on $100 gasoline. Comments were varied, ranging from things like “thought-provoking”, “great question”, “a good exercise”, and “interesting” – to “absurd”, “silly”, and finally my personal favorite (from the thread at The Oil Drum) “you have gone off the deep end.”

A number of people clearly didn’t understand the purpose of a thought experiment. For instance, it should have been clear that the $100 cost was not important. It could have been $20 or $1,000. The point is to look around you and see how much fat you could cut if you really had to – by imagining gasoline at an outrageously high price. I wanted to stick the cost out so far that you really have to make difficult choices – but I also wanted to provide a concrete number to think about. I find that people tend to give unreasonable answers if you just ask “What will you do if gasoline gets really expensive?” I get more realistic answers if I put a $ figure on the abstract idea of “really expensive.”

And even though I wrote “in reality the economy would have collapsed under those prices”, a number of people commented along the lines of “That’s unrealistic. The economy would have collapsed.” I can only imagine that these people have a very tough time when someone describes the gravity on Jupiter by using an illustration of how much you would weigh there (2.53 times as much if you are interested). I can hear them now: “That’s dumb. It’s a gas ball and the radiation would kill you anyway.” Yes indeed.

From those who did get the purpose – and even from some who didn’t – I got a lot of interesting comments. Following are excerpts of some:

Personally I could cope with $100/gallon gas (that’s A$27.50/L for Australian readers). I’ve telecommuted for a decade and visited the office so infrequently I’ve moved 800km away from the city office. I have solar hotwater and my daily energy usage is less than 10kWh/day. My late model Euro turbo-diesel does around 5L/100km, so it would cost $1500 to fill but that would drive me more than 1,000km. Most of the neccesities of life (supermarket, school, doctors, hospital etc) are less than 1km away so I can easily walk or bike it.

Problem is, would there be anything on the supermarket shelves? Would the hospital have any medicines or doctors?

Of course that last bit is the part over which we have limited control. We live in a very interdependent world. Rising prices will ripple out, with the impact unknown.

I understand what you are trying to do, but it is making my head spin. First, I live in the northeast and heat with oil. Domestic hot water from oil, too. We use about 600 gallons per year. Obviously we won’t at $100/ gal. Could we use 50 gallons per year, just heating the domestic hot water? That would only cost us a measley $5,000. Of course we wouldn’t have any water at all in the winter, because the pipes would be frozen. And no, burning wood won’t be an option.

This is where I think a lot of people are going to have issues. So what’s the solution for someone living in a cold climate for minimizing their fuel bills as prices climb?

Try not to look at the world through the eyes of the twentysomething. Imagine your your health being bad enough that walking a quarter-mile is a struggle. That using a cart to move your groceries doubles or triples your walking time. Consider being at risk to young criminals who steal your money, maybe even your food, and do you physical harm.

While I have the brain and body of a twenty-something ;-), my birth certificate says I recently became a forty-something. And I agree with your sentiments completely. High prices will be especially difficult as people age.

A comment like “living in an apartment expecting to survive with no real-world skills north of roughly 40ยฐ would be impossible” is probably valid. In my case, I learned how to garden, butcher, can and freeze fruits and vegetables, repair almost anything, carpenter, weld, masonry and farm. It’s my kids that would need some very quick education on basic self-sufficiency.

I am going through that education with my kids now. I don’t expect them to have to raise food to survive, but I want them to understand how it’s done.

I would be able to walk the two miles to work (as I do know, when the weather and time constraints permit), since I assume most people wouldn’t be driving anything beyond a scooter, so the road would be safe. No car. I picked my apartment because there is a metro station, and grocery stores within walking distance. Although a metro ride would likely cost $30+ a ride (electricity would cost??).

I’d imagine most of the outer suburbs near here would become small farms, I would bike there to buy a backpack worth of vegetables during growing season.

Even now, because of sky-rocketing food prices, I think gardens are going to start making a big resurgence. That’s going to be driven not by thoughts of survival, but about saving some money on groceries. That’s why we always had a huge garden when I was growing up. Personally, I am going to focus on items that produce a lot in a short period of time. My favorites to have in a garden are probably tomatoes, squash, and okra (although okra can take a lot of room).

Don’t forget about other things you use gasoline for. Right now I can pay a kid $25 to mow my lawn. At $100 for gas, $25 won’t even cover the gas for mowing. So, I would probably have to get a manual push mower. I am not even sure how well those things work, though, so maybe I would get a cow.

So far I am not getting any traction in my own family for my idea of parking a goat in the backyard. ๐Ÿ™‚

Robert, if you are concerned about not replacing a new hot water heater, you can get a thermosyphon type or a batch type of water heater. These basically just preheat the water before it goes into your existing tank, so that tank does less work. While probably not as efficient as a pressurized glycerol type of system, they are much cheaper to buy and install. Maybe $2-3k installed before federal/state incentives; less if you do it yourself.

I have thought about that. I need to run the numbers. If I really think prices are going to continue at this pace for the next few years, it would pay out relatively quickly.

The truth is that much of what is being discussed here is the maintenence of a lifestyle, not survival. For example, people did live in TX before air conditioning, and while many may move because they can’t afford it, others will continue to do so.

As for the elderly – elderly people living in isolation from their families probably will suffer a great deal – but there are solutions to that problem – cohabitation with extended family or friends who operate that way.

I grew up in Oklahoma without air conditioning. As a kid, it’s bearable, and I have long suspected this is why I am not very sensitive to the heat even now. But I remember going to my grandparents’ houses, and seeing their misery in the summer. Again, as you say, the problems are worse for the elderly.

I live in a temperate climate in Belgium and commute to work by electric rail. I imagine that my job would continue at the oil company where I am working. No doubt we’d have some new projects implementing tighter security at gas stations or maybe shutting pumps due to lack of volume.

On weekends, I would continue travelling to local shops, theatres, restaurants and museums via electric light rail. I would ride my mountain bike much more often as the traffic on local streets would be reduced. The quietness of empty streets will be a nice side effect of oil shortages.

I believe Europe is in a much better position for handling price shocks. And I agree with your comment on the quietness of the streets. Even now in the Netherlands – on a holiday or Sunday morning – I can often go out and there is absolute silence on the roads. It would be nice if this was always the case.

We have already built a wind generator and use propane for cooking and hot water. We could go off the grid, since TV and internet would be the first two things to go anyway. We don’t need to heat our water since a black hose in the sun works very well; and we could cook over a fire if propane was unavailable.

I have been thinking lately about the practicality and expense of a wind generator. I don’t have a feel for whether it is a realistic option for me. But not the Internet! I can give up TV (I can’t even remember the last time I turned it on), but I think I would give up hot water before I would part with the Internet. Interesting side-note. When I was in India recently, even the slums all had satellite dishes on top. I was also told that most have a small refrigerator. My takeaway lesson from that is that people are going to fight to keep the TVs on.

If telecommuting were not encouraged at work, I would move within bicycling distance of the office.

I planted three apple trees last year, and some vegetables yesterday. The grocery store is within bicycling distance, and yes, I have tried it out shopping and biking those groceries home in my backpack. I would need to go to the grocery store every other day, but the exercise would be healthy.

I think the trend would be the reversal of the suburban expansion. It would take a long time to happen – and I don’t agree with Jim Kunstler’s vision of the suburbs being abandoned. But we are already seeing a rapid slowdown in the present rate of expansion at today’s fuel prices.

I would walk to work (about 4.5 miles). I already do this from time to time and it really isn’t too bad. Groceries and most stores are with in the same distance.

Like you, I think there is a ton of fat that can be cut from the system — hell, even if the work force started riding motorcycles/scooters (as many are), there would be immense savings.

I don’t think we appreciate how creative we can be with price as a driver. That’s one reason I was never in the Doomer camp: While I think we have a potentially difficult stretch, we will adjust our behaviors. The best thing that can happen is that prices continue to rise at a steady pace – in front of peak oil – so we can start making adjustments before they are forced upon us.

There were lots of other good comments, but this is starting to get pretty long (and I want to go see the Open Air Museum today). You can see the entire list of comments following the original essay, and you can find more than 300 additional comments in the same thread at The Oil Drum. Here’s hoping the thought experiment remains just that.

13 thoughts on “Thoughts on a Thought Experiment”

  1. As you might imagine, I had one eye on the $100 piece as I quoted that Time Magazine article.

    I think the framing of the question is what gives some of us pause: “What would I, personally, do if gasoline was $100 a gallon?”

    As Peter Tertzakian ably showed us non-old folks in his book, A Thousand Barrels A Second, gasoline sales are at the end of an immense global supply chain. That system (system of systems) spans ever continent and bridges every ocean.

    Nothing short of science fiction, fantasy, or peak oil blogdom would raise gasoline to $100 overnight. Nonetheless, the framing of the question is such that the reader sees himself as a first responder.

    What would you do, if gasoline were $100/gallon? The very question reads like something from a cable-TV disaster show.

    I think a better framing, and perhaps what you were shooting for, would be the question “what would a future look like, with $100/gal gasoline?”

    That implies that the global supply chain has done its job, and over time, production has declines as prices have risen (or vis-versa).

    I’d imagine a future where most things are electric, and maybe quite a few “convenience” uses for fossil fuels are replaced by good old muscle power. As in “walk” ๐Ÿ˜‰

    On the other hand, I’d stay away from the whole wake-up-tomorrow visualization, because that pushes the wrong human brain buttons.

  2. Ironically I forgot one of the other trickle down items that would dramtically change… PLASTIC.

    If oil prices increase to the point gasoline was $100/g then all petroleum products would and plastic, something we’ve become heavily dependent on in so many ways would as well. So even if you do ride your rubber tired bicycle to the store packaged food is going to be dramtically more expensive. So if $100/g came I, personally, would eat a LOT healthier ๐Ÿ™‚

    In land development/construction I’ve already seen the price of plastic (PVC) water lines rise to the point where we can now specify metal (DIP) at the same price sometimes even less. It used to be metal was at least twice the cost and only specified when site conditions required it.

  3. Ah, that question is up my alley. I have a “rusty” chemistry degree that I seldom haul out.

    As it happens, what we call “natural products chemistry” had a long history before oil become a common source material. The earliest polymers and plastics came from (coal or) plant material.

    If you really expect a super-spike, find a rubber plantation to invest in ;-), tires are older than oil.

  4. BTW, if the question is a short-term one, and “what will you do if this price spike continues?”

    I’ll do what I have been doing, which is to continue reducing my energy (or CO2) footprint.

    Gasoline even at $4.20 (CA this morning) per gallon only costs me … 1.1% of my gross income … a bit of headroom there.

  5. Robert,

    I am the guy you quoted who had the comment about living in the northeast. I’ve since had time to think about this. We’re lucky, we’re empty nesters and we live in a modest (under 1,200 sq ft), well insulated home. If the price of oil were to skyrocket, we’d consider switching to electric heat and just not use much of it. For domestic hot water we’d go solar, supplemented with electric.

    We live in one of this country’s original planned communities (suburb of Philadelphia) and are within biking/walking distance of all major services, including a choice of hospitals. Rail service to center city Philadelphia is very close, too.

    Food would once again get shipped in from Lancaster, PA (too bad so much of its precious farmland is lost forever). We even have the old Delaware canal which could be put back in use.

    Personally, I don’t think it will come to that. But, it’s nice knowing we could survive rather easily.

  6. Okay, the thought experiment was fun, but I would like your take, or that of the group, on Shell saying they can extract shale oil at $30 a barrel. Given the despots of th Green River basin, and current price trends, this strikes me as fascinating…..
    I am growing veggies and fruit, and looking at some way to get to work in L.A. not alone in my care….ride-sharing websites have not panned out, too far to bicycle (and I am supposed to be presentable, tie suit etc). I am thinking scooter, or veggie-mobile, but people have caught on to the restaurant grease game, and you cannot just have it anymore…scooter means someday I get hit, and I am not insurable right now….
    Mass transit? A one hour commue become a 2:30 hour commute.

  7. Robert,

    I looked long and hard at small wind turbines for home use. Verdict: not good.

    They really need to be on towers at least 60-80 ft up to generate anything worthwhile. And the small ones have to spin very fast to generate any power. This creates tons of noise and vibration (important of the mast is attached to your house).

    Even in an ideal location, they only reach their rates power at like 20 mph winds. Hence average output is much smaller… in the range usually of a few hundred kwh a month.

    The money’d be better spent on a solar setup, IMO.

    http://www.wind-works.org/articles
    /small_turbines.html

    http://www.scoraigwind.com/
    index.htm

  8. this “$100/gal” environment would require analysis of many other “necessary for today’s existence” infrastructures/support services. many, if not most, would experience significant disruption/destruction.

    this entire ENERGY topic with its subleties would make a good thriller or how-to publication.

    fran

  9. I suppose my dismissiveness is because even if Peak Oil Happens soon, as an Aussie the idea of coal reaching a price equivalent to $100/gallon gasoline any time soon is just ludicrous.

    We have tracts of low-grade stuff that we don’t even bother to explore very well, let alone mine. That would change very quickly at prices very, very much lower than $100/gallon. And there are several obvious ways it could be used as transport fuel if we got desperate enough.

  10. My perception & experience is that high oil prices impact industries (i.e., transportation) much, much, much moreso than high oil prices impact individuals.

    My wife and I are squarely in the middle class (combined income of $80-90,000 annually). In January 2008 we budgeted $150 per month for gas for our two cars (CRV and Sienna.) For June 2008, we budget $300. No alteration in driving patterns. An extra $150 per month. Big whoop.

    This is annoying but nothing more. We don’t know anyone that is severely impacted financially by this kind of increase. It’s an annoyance and nothing more.

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