There is a serious danger that if we try to speed up too much the transition to clean energy we will have societal collapse. The results could be even much worse than climate change itself, which is saying a lot. I think it’s important in a site like this to discuss higher level macro-political topics that are really difficult to understand and communicate but will have a profound effect on our lives and the market. This is an extreme example of such a topic. It’s an idea that’s super-hard to fully understand but very important, sort of like trying to explain quantum physics without any math equations–but at least this subject while hard doesn’t require any math to understand.
I once attended a dinner where one of the guests was a member of the Institute for Advanced Study. Now, at least that used to be a place where some really important theoretical ideas were studied. I had a great evening talking to this person. Very seldom are the deeper kinds of questions he discussed really considered. I mention all of this because I want to talk about a book here of the sort of research that places like the Institute for Advanced Study might have done at one time. The book is entitled The Collapse of Complex Societies by Joseph Tainter. Basically, what Tainter did is go back and ask one of those bigger and crucial questions it’s not popular to ask anymore. He went and looked at a bunch of earlier civilizations in some cases very advanced in many ways for their times that ultimately collapsed. What he asked explains the collapse?
As societies advance they become increasingly complex which makes sense. Advanced civilizations including our own are infinitely more complex than simple societies. But here’s the problem. Among other things you can only have that complexity if you have the energy to support it. Advanced civilizations require much greater sources of energy than simpler ones which is not surprising. The key point is that over and over again when for a variety of reasons societies mess up and lose that energy source they collapse. Sometimes that occurs from external causes that can’t really be controlled. But many times bad leadership makes huge mistakes that causes that collapse to occur. They end up not having enough energy to maintain the more advanced social organization required and they go through a very dangerous and ugly process of reversion back to simple societies. Let’s just say you most definitely don’t want to live in a society going through that process, and it’s to be prevented and avoided at all costs.
Now, what does this have to do with oil, clean energy, and our society. Advanced modern societies were able to develop because of the tremendous energy provided by fossil fuels. No fossil fuels, no advanced modern complex societies. It’s as simple as that. You can still have social organization, but only a very simple kind no-one living today would be okey with or could possibly handle.
The problem is that fossil fuels are cheap and plentiful, and there’s actually no easy way to replace them. The other sources of energy are not available at scale at this point to maintain our complex level of civilization. Whatever they may try to tell you about the fact that things like wind and solar are more efficient, for a long ways into the future they’re not going to be a viable alternative to fossil fuels at the necessary scale to support our general energy demands. Nuclear energy might be.a sufficient substitute, but it would be very difficult for a variety of reasons to scale up to the necessary levels.
For over 150 years, fossil fuels have powered our civilization and even now despite all the efforts at clean energy development in recent years the total percentage of energy from fossil fuels is still over 80 percent. If you go to the US Energy Information Administration, the part of our government that concerns itself with these kinds of things, fossil fuels they conclude will still in 2050 make up a huge amount of overall energy needs, more than 2/3rds in both OECD and non-OECD countries.
Does this mean pursuing clean energy is a bad idea. Of course not, and in some areas it may be more practical than others even shorter term. But it does mean beyond the hype we are going to be dependent on fossil fuels for the majority of our energy needs for an awfully long time. Here is where the argument gets complicated and difficult unlike ideology. Ultimately to support an advancing complex society you do need to develop more and additional advanced energy sources. The higher level argument here is contradictory. You need the newer sources, but you have to transition to them in a very thoughtful, realistic, and not overly rushed way. The goals of political ideology and power might not sufficiently get that key idea.
Here’s another crucial point of this discussion though. Perhaps there will be technological breakthroughs that can change the mix. Those technologists that believe clean energy will somehow magically be able to more quickly replace fossil fuels believe that is going to happen. But they are making a key conceptual error. Computing power may follow Moore’s Law and double in capacity for the same cost every 2 years, but energy follows no such law. In the last 50 or so years computing power has gone up by a factor of over a billion. Incredible, isn’t it? So guess how much over the same period a solar cell has increased its energy output? Only by a factor of two. That’s a really big problem. The dream of giving up fossil fuels is, therefore, merely a millennial dream. And this is an aside, but the dream of AI I’ve discussed elsewhere requires tremendous amounts of energy and actually makes such changes even more difficult to achieve.
But here’s the truly scary possibility. What if advanced societies, alarmed by the fears of climate change, decide to politically push too far, too fast, what cannot actually be accomplished. And I know there are some bad and severe things that can happen because of climate change, but they are potentially manageable though they may cause some serious, regrettable problems. Even things like rising sea levels while highly unpleasant can be dealt with. And again I’m not arguing it’s bad idea to do what we can in a realistic way do. Clean energy is great. But what if we move to clean energy for political reasons in an extreme way and eliminate fossil fuels too much. The result of such a conceptual mistake can only be, as Tainter’s work shows, one thing—societal collapse. Let’s be realistic here. If the choice is civilization with climate change or civilization without climate change of course the right choice is the second one. But what if Tainter’s deeper research is correct, and the actual choice is civilization with some serious difficulties from climate change, or societal collapse as we have insufficient energy to maintain a modern complex society? Then the risk rewards change a lot, don’t they?
Now, some of the clean energy crowd is of the mind that if to tame climate change, we need to revert to such simple societies, so be it. But they have not thought that through because the change from complex society to simple society is extraordinarily horrible. Imagine the social unrest, political violence and cultural upheaval such a change would cause. Does anyone who’s a humanist and believes in civilization and truly reflects on these issues believe that’s a reasonable trade off? Such a position might make great political narrative and theater, but it’s not the truth.
What does this mean at the macro-political market level? First, fossil fuel companies aren’t going anywhere and are probably good investments and cheaper than they should be. Second, clean energy may be a good idea, but don’t believe a lot of the hype, and invest accordingly. I like and have gladly owned shares in companies like First Solar, but they aren’t going to replace the oil companies anytime soon. Third, clean energy can only be pushed so far and beyond that societal collapse will prevent it being pushed further despite what politicians may put on paper as to what must be done. Fourth, none of this means newer advanced forms of energy shouldn’t be developed and encouraged in realistic ways. We ultimately do need those new energy sources. Fifth, if you believe climate change will cause big problems give up the utopian solutions that are unworkable and if you’re an investor try to figure out what kinds of companies will be in demand to fix those problems.
But if you’re screaming, “No Fossil Fuels,” please don’t do so while scrolling down your iPhone–you won’t have an iPhone or any other civilizational products if you really try to do that and collapse our wonderfully complex society.
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