Energy and Society, 2nd Edition

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Fossil Energy

Reserves, Resources,

and Geopolitics

ENERGY RESERVES AND RESOURCES

Some  sources offer the prospect of being inexhaustible. Water and wind are

two such sources. Some more sources include biomass, solar energy, and nuclear

fusion (all to be discussed in later chapters). However, the common sources of

 that people in many countries rely on are electricity and liquid fuels for

transportation. These usually come from fossil fuel sources. Most of us take for

granted an unlimited supply of electricity; if there is any limitation at all, it is in our

ingenuity for plugging appliance upon appliance into the available outlets. Similarly,

we presume the ability to purchase unlimited amounts of gasoline or diesel fuel,

anywhere, anytime. But fossil fuels are not inexhaustible. And, unlike biomass, fos-

sil fuels cannot be regenerated on human time scales. Someday, in some sense of the

term, we will run out.

The concepts of reserves and resources to be discussed in this section apply to any

 source (and indeed to other natural substances as well, such as ores). The

reserve is the amount of a material that can be recovered economically with known

technology. Reserves usually are established by detailed exploration. A resource is

the entire amount of the material known or estimated to exist, regardless of the cost

or technological developments needed to extract it. In other words, the reserve is

what we’re sure of, but the resource includes what we think is there. By these deni-

tions, the amount of reserves is always less than the amount of the resource.

One’s personal nances can serve as an illustration of the concepts of reserves

and resources, and the various categories of each. A nancial reserve would con-

sist, rst of all, of the amount of cash in hand, the amount of money in checking

and savings accounts at the bank, and whatever cash advance could be gotten from

credit cards. All these amounts can be—in principle—determined quite accurately,

and they represent money that one can count on having. This money represents

proved reserves.

In addition to proved reserves, money could be raised by selling personal pos-

sessions, such as a car; or by liquidating investments, such as stocks or bonds. This

is a bit trickier than emptying a purse or wallet and bank account. First, stock and

bond markets uctuate daily, so that while certainly some money can be realized by

liquidating investments, it’s not certain in advance how much could be realized on a

particular day. Second, while used cars, antiques, and collectibles do have assessed

values, if forced to sell a car in a hurry, one can’t necessarily count on holding out to