Global Oil Price vs. renewable energy expension (2019)
/ Extractivism - Ecuador & Global (Crude Oil & Mining)
# Diagramm III.2.5.2
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For the projection of the EEA power expansion from diagram III.2.4.2 - "Scenario 3" and the assumptions on peak oil, it is possible to determine energetically which share of generation by EEA in the electricity and primary energy sectors corresponds to the energy input of interconnected fossil fuels and consumption. Electrically, 1.7 TWh/a per M.b/a of oil units can be assumed for primary energy. If the respective process efficiency is taken into account, depending on the final energy input, at least this value is halved by the transformation. With the increasing substitution of combustion processes by electrical machines, the ratio of final energy input to primary energy input changes significantly - it is the same... Ultimately, less than one TWh of electrical energy is required to replace one M.b of crude oil. This proportion is included in the calculation. The purple curve describes this replacing share in relation to the reference year 2015, for which the oil production of approx. 96 M.b/d is known. With the expansion of EEA according to "Scenario 3", fossil power plants with nuclear, coal, oil and diesel fuels will almost completely reduce the oil equivalent demand (dark green) of 23 % in 2015 by 2035. The annual reduction is growing exponentially, cutting off a further portion of fossil demand with each addition (cutoff, dashed light blue). If this cutoff is related to the quantity of crude oil produced, a divider ratio (orange dashed, right to "1") results to the crude oil requirement. This describes a stable crude oil price at the value "1" (normalization). If this value falls only slightly below "one", then there is a higher energy demand, which must be covered in the short term by fossil energy sources and thus causes raw material energy prices to explode - as was observed in the period 2006 - 2015, although the divisor ratio only had a maximum difference of - 2 %. Conversely, in the period 2015 - 2016 the value was only + 2 % higher than the standardization, which led to the collapse of the oil price up to the marginal costs. This shows how sensitive the commodity market and price are to speculation. If renewables are now expanded further, as in "Scenario 3", this divider ratio will increase even more dramatically. Political market regulation will not have it easy to regulate the ever shrinking and thus more vulnerable market, which will lead to ever stronger and faster price fluctuations. In this model calculation, a cut-off of 3%/a can be expected as early as 2025. Both amplitude and frequency of oil prices will increase significantly until 2030, when the market will have shrunk to a low level compared to alternative fuels such as electricity and PtG. The leap of the orange dotted ratio curve from maximum to minimum in 2030 means nothing other than a mathematical singularity as a milestone of the meaninglessness of the raw material in the market, in which the previous market mechanisms no longer apply. A chaotic principle almost abruptly ends the fossil energy age. What is new in this edition is that the dotted lines (dark purple and light blue) describe an equivalent price corridor with the help of the new dependency found in Diagram III.2.3.1 and the investment cost development for EEA, in that the oil price will move on average. Overshoot and undershoot are to be understood as a natural autocorrection, which, however, becomes increasingly smaller. Thus, a price corridor for the future crude oil price has been successfully defined. In 2025, the average price corridor will be 40 USD/b, which, conversely to Diagram III.2.3.1, corresponds to an economic oil reserve of just under 450 G.b from today's perspective. From 2016 until the end of oil, about 550 G.b crude oil will be produced. If the investment costs in EEA fall below 20 USD/b per 0.8 MWh in another 10 years, until 2030, this beats any marginal oil production costs. Oil production will then only be possible with massive subsidies, i.e. economically at long last. It is emphasised that this is a simulation which reveals the dependencies, modes of action and developments; however, the time horizon is also dependent on the development of the other fossil energy sources, which were not included here, and can therefore also shift significantly. CC-BY-NC-SA 4.0, TEOO.de; Stefan Golla (2019) Translated with www.DeepL.com/Translator