Final report on energy, supply, demand/need and the gaps between : to the M.W. Kellogg Co., Houston, Texas and the Environmental Protection Agency under Task 27 of EPA Contract 8-01-1308

Abstract

This paper is a summary, based on a critical review of selected literature pertaining to energy supply, demand, supply/ demand imbalances and the operational/technological developments needed to redress imbalances. Crises have been a recurrent feature of man's history. There was a crisis based on a shortage of wood fuel in the early 17th century. Whale oil was so short during the Civil War that the price doubled, yet it then dropped by a factor of six before the end of the century as kerosene became an alternate option. Energy demand growth soared in the U.S. over the last two decades not because of need but because real energy prices dropped. Energy was substituted for labor and material which were costing more. Now we have materials as well as energy shortages and massive unemployment. There is little agreement regarding our future supply of fossil fuels and no consensus on the best way to reduce demand. History tells us that the imbalance will be resolved. It is our task to make sure that the resolution occurs with the lowest possible social and environmental cost. Price can resolve the imbalance, but because price dbes not often reflect all costs this resolution can be very disruptive. Alternatives must be developed and options broadened. Opportunities for conservation should not be overlooked for the marginal barrel of oil saved is of greater value than the marginal barrel of new production. A series of working papers and monographs which discuss certain aspects of this review more broadly are included in Volume II of this report.