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Investing in Renewable Energy: Making Money on Green Chip Stocks by Jeff Siegel, Chris Nelder

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Chapter 8. FOREIGN OIL: The Path to Suicide

Of all forms of energy in use today, oil has the lion's share. It accounts for 40 percent of our overall energy consumption, and over 90 percent of the energy we use for transportation.

Essentially everything in our modern lives is made with some contribution from oil. For example, oil and gas are embedded into every aspect of making a common shirt: from the feedstock to making nylon or rayon, to running the looms, to transporting the shirt to a store, to the transportation used to take the shopper to and from the store.

Further, our whole civilization is heavily dependent on it—as George W. Bush has famously said, "America is addicted to oil." Liquid fuels made from petroleum are incredibly convenient, dense in energy, and easy and cheap to produce. And they are not easily replaced with something else.

But we are now facing a serious and imminent problem with oil production. As mentioned in Chapter 1, this problem is known as peak oil.

Peak oil presents us with an enormous challenge, because all economies depend on constant growth, which in turn depends on constantly increasing the rate of energy production. After we pass the peak rate of production, we have to live with less and less oil each year, rather than more and more.

This is a difficult realization, for we have generally managed to increase oil production continuously since the birth of the oil industry, long before any of us were born. The assumptions and theory upon which we have ...

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