Every day, businesses, government agencies and households around the world plan and make decisions based on the assumption that oil and natural gas will remain plentiful and affordable. In the past few years, powerful evidence has emerged that casts doubt on that assumption and suggests that both oil and natural gas production are likely to begin to decline significantly. This phenomenon is known as “peak oil.”[1] Given the fundamental role of oil and natural gas in all levels of social, economic, and geopolitical activities, the consequences of such a change are enormous. Portland City Council created the Peak Oil Task Force by resolution to investigate the implications for Portland of a future in which oil and natural gas production is declining, prices are rising, and supply is subject to periodic volatility. The resolution charged the Task Force with addressing these issues and presenting findings and recommendations to the City Council.
The starting point for the Task Force is well summarized in the introduction to the February 2005 United States Department of Energy (U.S. D.O.E.) report, Peaking of World Oil Production: Impacts, Mitigation, & Risk Management:
The Earth’s endowment of oil is finite and demand for oil continues to increase with time. Accordingly, geologists know that at some future date, conventional oil supply will no longer be capable of satisfying world demand. At that point world conventional oil production will have peaked and begin to decline.[2]
While there is a wide range of opinions on when the peak will occur, many experts predict global oil production will peak within five years, and few anticipate a peak later than 2020. For purposes of the Task Force these debates about when the peak will occur are largely irrelevant. Fossil fuel consumption patterns cannot be substantially altered without changing the transportation and building infrastructure. Since these change slowly, action is required now even if peak production is 10 or more years away. Again, the U.S. D.O.E. report is instructive:
Mitigation will require an intense effort over decades. This inescapable conclusion is based on the time required to replace vast numbers of liquid fuel consuming vehicles and the time required to build a substantial number of substitute fuel production facilities. . . . T