The Crash Course - Chris Martenson [136]
Still, here are a few basic “truths” that I think will shape the future significantly:
1. Net energy has peaked (or will soon), and this is a permanent condition.
2. The global energy allotment available for economic development and the economy itself will decline in lockstep.
3. Without increasing energy flows, the economy will “simplify,” which is a euphemism for a massive structural shift that may be incredibly disruptive for a lot of people.
4. Without growth, most tertiary forms of wealth, such as stocks and bonds, will lose an enormous amount of their current value.
5. As with any shift, there will be winners and losers, largely segregated by who sees the changes coming first and adapts most rapidly—and who doesn’t.
I reserve the right to change these views, should reliable new information arrive that runs counter to the data that formed these conclusions, and I encourage you to leave space in your thinking for changes based on new information that we may not even be capable of anticipating yet. But the past six years leading up to the writing of this book have seen an almost uninterrupted string of confirmations supporting the ideas and concepts contained herein. With that in mind, here are the opportunities that I see:
Resource Management and Materials Efficiency
In the future, reduce/reuse/recycle will no longer be just a feel-good slogan of environmentalists—it will be an important operating paradigm. Those countries and companies that perform the task of managing their energy and materials streams the most efficiently will fare better than the rest. There will be enormous opportunities in this arena going forward, including everything from point-of-source collection and separation, to recovery and reclamation services for waste streams, to designing more efficient production processes that absolutely minimize waste and loss. New jobs and skills will be required and created in this field. While doing more with less has always been the essence of good business, this field will require a parallel mind-set that can measure and incorporate the intrinsic value of things that simple prices based on money have traditionally overlooked.
If I owned a company that relied upon resource flows, I would seriously consider building up my inventories of those items most critical to value creation. I would trade a few points of profitability gained from cost-effective inventory management for the certainty of knowing that my business had what it needed to continue operating at a time when markets and circumstances might be too turbulent to support my resource requirements.
Part of the new measure of intrinsic value will need to include energy returned on energy invested, or EROEI. Companies and countries alike will need to begin making decisions based on the energy impacts of various factors. For example, should a government support investment in a new high-speed rail system, or the retrofitting of existing structures with additional insulation? Which one would be better for society in the long run? Right now, the decision would be based on cost and political considerations. In the future, the EROEI of the two options should be prominently displayed, like a window tag in a new car revealing the mileage per gallon of the vehicle being considered, so that this information can be weighed alongside other criteria. Developing useful EROEI estimates is not trivial work and will require the services of many bright people.
Food
Food is a multihundred-billion-dollar industry, and it will be undergoing a radical transformation over the coming years. Once the energy crunch begins, food will, by necessity, go up in price. The opportunity here, already being seized by communities in all corners of the world, is to get involved in the relocalization of food production, storage, and distribution. As a contrarian investor, when I look at a chart like this, I think that there’s only