1.
Peak Oil Futures:
a possible transport scenario to 2030 and its
consequences, using the “4see” model
By Simon Roberts, Arup
(Foresight, Innovation and Incubation Group)
15th November 2011
For APPGOPO, Westminster

2.
• “Peak oil” is a global
problem..→
• ..but take a UK perspective
• How might the UK prepare?
• Apply Arup’s “4see” model
(socio-economic and energy)
• Develop an example scenario
(not a forecast) of possible
ITPOES Report 2, February 2010
feasible proactive steps to
reduce oil dependency
Global oil demand for 1920-2008 with extrapolations to 2050.
2 Introduction

3.
Challenge for the scenario
• Acceptable by society:
- acknowledge driving behaviour
• Technically feasible:
- scaleable over next 10 years
• Economically affordable:
- not bankrupt UK economy
• Politically acceptable:
- check side effects on economy
• Data sources:
- use official statistics and other reputable sources
3 Scenario constraints

4.
• Total oil (petroleum Total petroleum products consumed
products) use by UK, 4,000
historical data → 3,000
PJ/y
2,000
1,000
0
1990 2000 2010 2020 2030
• Petroleum products
(pet-prod) use in transport →
• Chart shows the main users:
- vans (LGV)
- trucks (HGV) *
- aviation
- cars *
4 Use in the UK of petroleum products

5.
4see model
Introduction to one part of the model

6.
Cars
6 Cars

7.
Cars: data for numbers of
Size of car fleet New cars per year
32,000 3,200
24,000 2,400
k veh/y
16,000 1,600
k
8,000 800
0 0
1990 2000 2010 2020 2030 1990 2000 2010 2020 2030
7 Cars data

8.
Cars: stocks-and-flows model
Size of car fleet New cars per year
32,000 3,200
24,000 2,400
k veh/y
14.5 years 16,000 1,600
k
8,000 800
0 0
1990 2000 2010 2020 2030 1990 2000 2010 2020 2030
8 Cars stocks and flows

9.
Cars: data for fuel use and distance travelled
Pet-prod use by cars Total car km
1,200 440,000
900 330,000
M veh km/y
PJ/y
600 220,000
300 110,000
0 0
1990 2000 2010 2020 2030 1990 2000 2010 2020 2030
9 Cars data

10.
Cars: process flows model
Average car fuel consumption Average car km per year
0.004 20
0.003 15
k km/(y*veh)
PJ/M veh km
0.002 10
0.001 5
0 0
1990 2000 2010 2020 2030 1990 1998 2006 2014 2022 2030
10 Cars process flows

11.
Cars: full model, trended forward
New cars per year
3,200
14.5 years 2,400
k/y
1,600
800
0
1990 2000 2010 2020 2030
11 Cars model

12.
Trucks
12 Trucks

13.
Trucks: stocks-and-flows and process flows model
New trucks per year
New trucks per year
8060
10.2 years 6045
k veh/y
k veh/y
4030
Average truck fuel consumption Average truck km per year
Average per year
Average truck fuel consumption
0.016 80
80
0.016 2015
0.012 60
60
0.012 0 0
k km/(y*veh)
PJ/M veh km
PJ/M veh km
1990 2000 2006 2014 2022 2030
1990 1998 2010 2020 2030
0.008 40
40
0.008
Size of truck fleet
0.004 20
20
0.004 600
0 0
0
0 450 1990 1998 2006 2014 2020 2030
1990 2000 2010 2022
1990 2000 2010 2020 2030
1990 2000 2010 2020 2030
300
k
150
0
1990 2000 2010 2020 2030
13 Trucks model

14.
Scenario
Developing the transport part

15.
Business as usual (BAU) Petroleum products for transport
2,400
• Total consumption of
1,800
petroleum products used by
all transportation →
PJ/y
1,200
600
0
1990 2000 2010 2020 2030
• Cumulative costs of measures £(1990) cost of measures
to reduce use of petroleum 16,000
products by transportation → 12,000
AM£/y
8,000
4,000
0
1990 2000 2010 2020 2030
15 Developing scenario I

16.
• The upper estimate assumes
10% supply from first
generation biofuels because
biofuels will also be
important to achieving the
Fuel Quality Directive
• A significant proportion of
"Analysis of Renewables Growth to 2020", AEA Techology, March 2010, July 2011
UK biofuels are currently
sourced abroad
• First generation technologies
for biofuel: • Difference between AEA’s
- bioethanol technologies use upper and lower estimates in
sugar beet or wheat 2030 is 2,000 Ml/y (53 PJ/y)
- biodiesel processes use rape seed
oil, palm oil or soy oil
16 Bioliquids

17.
• Bioliquids Petroleum products for transport
- Additional 53 PJ/y (2,000 Ml/y) 2,400 ↓
in 2030
1,800
PJ/y
1,200
600
0
1990 2000 2010 2020 2030
£(1990) cost of measures
16,000
12,000
AM£/y
8,000
4,000
0
1990 2000 2010 2020 2030
17 Developing scenario I

18.
• Cars energy efficiency
- Lightweighting 10%
- Low rolling resistance tyres 3%
- Improved aerodynamics 3%
- Direct injection and lean burn
11%
- Variable valve actuation 6%
- Downsizing engine capacity with
- turbocharging or supercharging
Interim analytical report , October 2007
12%
“By adopting a small selection - Dual clutch transmission 4%
of the most cost-effective - Stop–start 3%
technologies, 30 per cent - Stop–start with regenerative
efficiency savings could be braking 7%
- Electric motor assist 7%
achieved for the average new
- Reduced mechanical friction
vehicle, relative to today’s components 4%
equivalent model.”
18 Car energy efficiency

19.
• Bioliquids Petroleum products for transport
2,400 ↓
• Energy efficiency of new cars
1,800
- “by adopting a small selection of
the most cost-effective
PJ/y
1,200
technologies”
- 30% improvement 600
- £1,500 per vehicle (in 2007)
0
- 50% of all new cars 1990 2000 2010 2020 2030
£(1990) cost of measures
16,000
12,000
AM£/y
8,000
4,000
0
↑
1990 2000 2010 2020 2030
19 Developing scenario I

20.
Trucks energy efficiency:
• Aerodynamically shaped
trailers
• Aerodynamic fairings
• Spray reduction mud flaps
Ricardo report, March 2010
• Low rolling resistance tyres
• Single wide tyres
• Automatic tyre pressure
adjustment
• Vehicle platooning
20 Truck energy efficiency

21.
• Bioliquids Petroleum products for transport
2,400
↓
• Energy efficiency of new cars
1,800
• Energy efficiency of new
PJ/y
1,200
trucks
- 44% improvement 600
- £16,300 per truck (in 2009)
0
- 50% of all new trucks 1990 2000 2010 2020 2030
£(1990) cost of measures
16,000
12,000
AM£/y
8,000
4,000
0 ↑
1990 2000 2010 2020 2030
21 Developing scenario I

22.
1999: Peugoet 106 electric with on-street charging point, opened by Kate Hoey MP 2004: 1kWp PV array on roof providing 2/3 of electricity for EV
Prius hybrid (2000) Vegetable oil filling diesel VW camper
22 Personal experience

23.
23
"Review of low carbon technologies for heavy goods vehicles“ April 2010
Cars trips and fuel use

24.
24 Opel/Vauxhall Ampera, range-extended EV

25.
• Bioliquids Petroleum products for transport
2,400
• Energy efficiency of new cars ↓
1,800
• Energy efficiency of new
PJ/y
1,200
trucks
600
• Plug-in hybrid/
ranged-extended EV 0
1990 2000 2010 2020 2030
- range 35km corresponding to
57% of usage
£(1990) cost of measures
- but presume plugged in for only
16,000
2/3 of potential electric range
- £6,500 per vehicle (in 2007) 12,000
from The King Review
AM£/y
- 50% of new vehicles 8,000
4,000
↑
0
1990 2000 2010 2020 2030
25 Developing scenario I

26.
26 Natural & bio Gas Vehicle Association (NGVA)

27.
• Bioliquids Petroleum products for transport
2,400
• Energy efficiency of new cars
1,800
↓
• Energy efficiency of new
PJ/y
1,200
trucks
600
• Plug-in hybrid/ranged-
extended electric vehicle 0
1990 2000 2010 2020 2030
• Compressed natural gas
(CNG) on new cars £(1990) cost of measures
16,000
- £5,000 per vehicle (in 2003)
- 50% of new vehicles 12,000
- convert 1,300 filling stations ↑
AM£/y
8,000
4,000
0
1990 2000 2010 2020 2030
27 Developing scenario I

28.
• Increased gas use… → Total consumption of gas
4,000
3,000
↑
“2050 Pathways Analysis”
PJ/y
2,000
DECC
1,000
• Onshore wind:
- Level 1: 11 GW 0
1990 2000 2010 2020 2030
- Level 2: 20 GW
- Level 3: 31 GW
Total consumption of gas
• Offshore wind: 4,000
- Level 1: 8 GW 3,000
- Level 2: 46 GW
PJ/y
- Level 3: 68 GW 2,000
1,000
• …offset by wind turbines → 0
1990 2000 2010 2020 2030
28 Offset gas use by wind turbines

29.
• Bioliquids Petroleum products for transport
2,400
• Energy efficiency of new cars
1,800
• Energy efficiency of new
PJ/y
1,200
trucks
600
• Plug-in hybrid/ranged-
extended electric vehicle 0
1990 2000 2010 2020 2030
- With extra 9 GW onshore
• Compressed natural gas £(1990) cost of measures
16,000
(CNG) on new cars
- With extra 27 GW offshore 12,000 ↑
AM£/y
8,000
4,000
0
1990 2000 2010 2020 2030
29 Developing scenario I

30.
• Bioliquids Petroleum products for transport
2,400
• Energy efficiency of new cars ↓
1,800
- 25% of new cars
PJ/y
1,200
• Energy efficiency of new
trucks 600
- 50% of new trucks
0
1990 2000 2010 2020 2030
• Plug-in hybrid/ranged-
extended electric vehicle
£(1990) cost of measures
- 25% of new cars 16,000
- With extra 3.5 GW onshore
12,000
• Compressed natural gas
AM£/y
(CNG) on new cars 8,000
- 25% of new cars ↑
4,000
- With extra 17 GW offshore
0
1990 2000 2010 2020 2030
30 Developing scenario II

31.
• Cost compared to GDP:
- 0.76% →
Measures cost as proportion of GDP
0.02
0.015
0.01
• Does this low proportion
mean the economy can 0.005
↑
“afford” the investment?
0
• What side effects across the 1990 2000 2010 2020 2030
economy might result from
systemic interaction?
31 Cost of measures compared to GDP

32.
GDP
Another part of the 4see model

33.
33 Supply and Use Tables for deriving GDP

34.
Output Expenditure
↓ ↓
34 GDP from production by three larger economic sectors (2008)

35.
GDP(output) GDP(expenditure)
↓ ↓ ↓
35 GDP from production by three larger economic sectors (2008)

36.
Sector dependency (intermediate consumption)
↓
36 GDP from production by three larger economic sectors (2008)

37.
Destination of final demand
↓
37 GDP from production by three larger economic sectors (2008)

38.
Investment maintains and grows assets
↓
38 GDP from production by three larger economic sectors (2008)

39.
Sector inputs: fuels, electricity, jobs
↓
39 Inputs to the economy

40.
One sector alone: service sector
40 Service sector

41.
Economic sector: stocks-and-flows, process flows
41 Service sector stocks-and-flows and process flows

42.
Measures increase investment proportion of GDP
↓
42 GDP expenditure components over time

43.
Side effects of measures
Systemic consequences suggested by the 4see model

44.
44 Unemployment

45.
Growth Growth of GDP per year
0.04
• Annual growth peaked at 4%
in the past → 0.03
per y
0.02
• Scenario here has growth of
about 1.8% → 0.01
0
1990 2000 2010 2020 2030
Unemployment Unemployment rate (%)
12
• Increased by 0.4 percentage
points →
9
percent
6 ↑
• 150,000 more unemployed
3
• Results from differing jobs 0
intensity of goods and services 1990 2000 2010 2020 2030
45 Economic growth and unemployment

46.
• Trade in fuel: derive price Crude oil price
from actual trading costs 12
(from the “Pink Book”) → 9
FM£/PJ
• Reference price to basket of 6
27 economies using REER
3
(Real Equivalent Exchange
Rate) 0
1990 2000 2010 2020 2030
• Oil refineries Petroleum products price
- historical constant capacity 12
- so constant demand for crude 9
- and constant output
FM£/PJ
6
• Therefore,
3
- as less petroleum products are
used, 0
- more petroleum products exported 1990 2000 2010 2020 2030
46 Trading price of fuels with respect to a basket of currencies

47.
• Imports of fuel decreased Fuel net exports
(higher level on chart of net 14,000
exports) → 0
• Cost reduction by M£6,000/y
EM£/y
-14,000
(at 1990 prices)
-28,000
↑
-42,000
1990 2000 2010 2020 2030
• Imports of goods (less fuel) Goods (less fuel) net exports
increased (lower level on 0
chart of net exports) → -30,000
EM£/y
• Cost increase of M£4,000/y -60,000
(at 1990 prices) -90,000
-120,000 ↓
1990 2002 2014 2026
47 Changes in trade

48.
• Effect on CO2 emissions
compared to BAU (reference
case)
• Reduction by 40 MtCO2/y in Total CO2 emissions
2030 → 600
450 ↓
MtCO2/y
300
150
0
• Implementation of low- 1990 2000 2010 2020 2030
carbon measures for other
parts of economy not
considered in this scenario
48 CO2 emissions

49.
Final comments

50.
Generation: Consumption:
• Biomass electricity • Efficiency in workspace,
warehouse and retail
• Bioenergy boilers
• Aviation efficiencies
• Solar thermal hot water
• Passiv haus new housing
• PV (photovoltaics)
• Double glazing
• CCS (carbon capture and
sequestration) • Loft insulation
• CSP (concentrator solar • Cavity wall insulation
power) electricity transmitted
from North Africa • Solid wall insulation
• Heat pumps
• LED lighting
50 Other measures in the 4see model

51.
• GDP analysis blind to
ownership within economy
• If full cost of measures were
put onto use of petroleum Measures cost per litre of fuel
products then.. 0.4
• ..about 20p per litre (at
current prices) →
0.3
£curr/litre
0.2
↑
0.1
0
1990 2000 2010 2020 2030
51 Possible payment system

52.
Petroleum products for transport • 1,300 CNG refuelling
2,400 stations
↓
1,800
• 3.5GW increase in onshore
and 17GW in offshore wind
PJ/y
1,200
600 • Unemployment up 150,000
0
1990 2000 2010 2020 2030
• Fuel imports down
M£1,100/y (1990£)
• Petroleum products 22% • Goods imports up M£600/y
reduction in 2030: (1990£)
- 2% from biofuels
- 3% from efficiency of cars • CO2 emissions reduction
- 4% from efficiency of trucks 40MtCO2/y
- 3% from plug-in hybrid or range-
extended EV • Cost 0.7% GDP as 20p/litre
- 9% from CNG fuelled on fuel
52 Scenario II

53.
Observations from applying the 4see model to
reduce petroleum products use by transportation
• Main pet-prod users: cars, HGVs, LGVs, aviation
• Note trends in vehicle ownership and driving behaviour
• Apply a combination of technology and fuels
• The 4see model can calculate marginal costs to the economy
• A shift from final consumption (of GDP) to investment might
increase unemployment
• Comparing changes in value of imported fuel to imported goods
could show a benefit
• This scenario is a starting point for examing the system
interactions and sensitivies of these issues
53 Conclusions

54.
www.driversofchange.com
peakoiltaskforce.net
Simon Roberts
simon.roberts@arup.com

55.
Supply Table
55 Supply Table

56.
Use Table
56 Use Table

57.
Factor incomes
57 Factor incomes

58.
Final demand
58 Final demand