How are businesses going to cope with fossil fuel phase out?

The world’s population consumes 40,000 gallons of oil per second. Oil production has reached its peak in 33 of 48 countries, meaning that oil production is rapidly in decline and other forms of fossil fuel such as gas and coal are not far behind. Scientists estimate that if current levels of consumption continue, our energy reserves will have run out by the middle of this century. The population keeps growing and we incorporate electrical technology into our lives more and more. We are becoming more, not less, dependent on energy, and this trend is showing no sign of slowing down.

Businesses are no exception. Energy is required for almost every operation, from heating an office to manufacturing parts or shipping finished products to customers.

 

Over time as current reserves become further depleted, costs will rise and the availability of fossil fuels will become scarce. It is not just a matter of thinking 50 years into the future as to what we will do when the energy has run out, it is necessary to begin considering what we should be doing now: how our business will cope in the run up to the looming energy crisis, and how we will hopefully prevent it.

Many countries are working on producing new renewable energy sources as well as decentralizing production. US alternatives include shale gas and tight gas, as well as making more transport reliant on electricity. Renewable sources provide hope that we will be able to maintain our lifestyle to a significant degree and not find ourselves in this position with the same fears again.

 

Decentralizing supply is good for another reason: energy security. Centralized supplies give rise to increased risk of crises occurring that have devastating effects due to widespread unavailability of power. Threats include wars and attacks on tankers or pipelines, from a human perspective. These are likely to increase as availability decreases. Further to this, with climate change going on, natural disasters pose additional risks.

Daniel Yergin, a leading energy scholar, discusses the risks to energy security in numerous papers and his book The Quest: Energy, Security, and the Remaking of the Modern World. He has noted a further form of energy security risk in the form of cyber-attacks. As digital technology becomes more sophisticated, more and more relies upon central computer control. If these are hacked, control of entire energy infrastructure is open to abuse.

 

Localized forms of renewable energy, such as solar panels, hydroelectric dams and wind farms, mean that resulting problems would be much less widespread. These also decrease reliance on nuclear power and any associated risks. Businesses can cope by making sure they make this a primary concern. Many governments are offering incentives such as grants and tax cuts to businesses that successfully cut emissions and start to generate localized power. For example, if your business is interested in putting in solar panels, according to the pros at Allstate Roofing, “Terrific rebates, federal and state tax incentives and plenty of appealing financing and leasing options help to defray the cost of solar roof installation.” There is much you can do – switching as far as possible to renewable sources. This may mean implementing new technology, changing where you source your energy from, performing an energy audit, and taking steps to reduce your energy consumption as far as possible.