Monday, October 23, 2006

What will power the next superpower??

Life is a flow of energy, and it requires a flow of energy to sustain itself. No wonder it is true for nations and more so for Superpowers!!
World has had superpowers before and it doesnt look like we are going to be deprived of one in the future as well.
Romans and Greeks probably did it on the basis of their agricultural prowess.Not surprising given that we did have these energy guzzling machineries in that era.
British did it on coal and steam engine. This brought about an industrial revolution and an inflexion point in human history.
USA carried that forward but on a magic liquid called the black gold a.k.a oil.
All the erstwhile empires lost their prominence on the world stage with loss of control on the source of energy or an alternative source coming about.And it also not surprising that the empires perished trying to get hold of these resources.
Greeks, Roman and British Empires were all victims of their own expansionary and imperialistic ambitions.These ambitions were not whims and fancies of the empire but became a requirement as needs of the empire and its people grew. It became the pre-requisite for sustenance.
Today we recognise US as the sole superpower.Oil is what powered it to these heights. It won the World Wars on oil.It achieved the highest state of living in the history of human civilisation, driven by oil.But as i have argued before, think we are at the begining of the end of the US era of dominance.
Just that i will be seeing it from the perspective of energy.
US was largely self sufficient in oil through a big part of last century. But its oil production peaked out in 1970s. and since then it has become increasingly dependent on others for its oil requirements. It was not that big a problem till the dependency was limited to its friends like UK. And also a big bear market commodities helped it sail through in the last quarter of the century.
But now it imports more than 60% of its oil. And more importantly, increasingly from not so good friends like Venezuela. UK production also seems to have peaked out with North Sea struggling.Like all good old empires US is now trying to get control of as many resources as possible. First to bear the brunt was Kuwait under the pretext of saving it from Iraq. US troops has still not left Kuwait a decade after the war is over. US has a massive troop presence in Saudi Arabia as well.Then came Saddam Hussein. Since they could not find any other valid reason to oust him, weapons of mass destruction were introduced as a pre-cursor to an ultimate invasion on Iraq's sovereignity.US presence in the Middle East is not at all funny.It is just doing what it has to do to survive.These regions are the last rich source of oil as we know it today. Next on the cards is Iran.
But then it is here that the picture changes. Because now China comes into picture.It is equally hungry to feed its own people and cannot possibly allow US to have an overwhelming presence and dominance in the region.So a war with Iran is fraught with th risk of plunging the whole world into a massive conflagration, which you might want to call the Third World War or Second Cold War.
Oil would be one of the reasons for the possible war besides many others including water.
But whoever comes out victorious from this clash has to sustain itself and oil may not be the answer this time.We have to turn to some other sources.
Alternatives:
Natural Gas: This is at present seen as an alternative, but the question is the same. Is their enough gas? and if yes where??...hope we dont again get to the Middle East for a very big part of the answer.
Wind Energy : Big source but not likely to have a the capacity to feed humans given its limitations in the sense wind speed, open land requirement etc.
Cold Bed Methane, Geothermal and so many others but they are a few decades away before making any meaningful contribution.

Think the source to bet on is the Sun. Everyday we get energy from the sun which ten of thousands of times the energy requirement for the whole year.The potential is much bigger than wind because of the retail penetration potential it has. You can have your power generator on your terrace.Clean and environment friendly. Solves so many problems that it almost sounds like an elixir for all our energy problems.The only problem as of now is the economic viability.But that after all is a relative measure.
5 of the biggest oilfields in the world have been producing oil from 1940s maybe. the last big discovery of oil was more than 3 decades ago. Ghawar, the oil field which supplies 5 mbpd oil out of a total world production of 84 mbpd, requires 15 million barrels of water to be pumped in to sustain the pressure to sustain production.The estimated reserves of these oil fields have been calculated to be the same over the last 25 years with no significant efforts for futher exploration.Mind you we are drawing oil from these fields big time and it is a little hard to digest that the reserves are still the same.
I believe oil will go beyond 100$. its a question of time and a time which is not too distant in future.And when that happens other sources of energy will follow suit given their supply limitations. Except maybe the Sun.

My bets are with the sun. How about you??