If you’d like to understand better how the introduction of electric vehicles will affect the oil market at the margin, then you should read Oil Fall, a three part series that explains how wind and solar power will jailbreak the powergrid, and find their way into global transportation.
Part one, California ICE, is now released and follows the beginnings of this story from California, which is now producing 20 percent of its electricity consumption from wind and solar power alone, and, which is at the forefront of electric vehicle adoption.
From the introductory, first chapter:
We have long assumed the most dangerous moment for the oil industry will arrive when demand for its products enters permanent decline. That’s understandable. However, by the time global oil demand actually enters outright decline, the damage to oil prices and the oil industry will have been underway for some years. The pivotal moment for the oil industry—indeed for all capital intensive industry—is not the decline, but rather, the transition from positive annual growth to zero growth, or a flatline.
Oil Fall is the story of how near we are to that moment of zero growth. For some, the story will seem improbable. For others, inevitable. It’s a story that begins in California, will soon run through China, and eventually will distribute its thermodynamic savings, and economic change, across the world economy. These three phases of the story will be laid out over three short book installments. And the first, which you are about to read, is called California ICE…
…What’s about to happen in California, and the United States, and then the world more generally with China as a foundational leader, is that electricity—long trapped behind an insurmountable wall—is going to find its way into the transportation sector. The reason to tell this story now is that we are poised at that curious moment when, after nothing happening for a long time, everything appears to be happening at once. California is about to trigger an exceptionally powerful formula for breaking the ringfence that oil has long enjoyed over transportation: new wind and solar power constructed across the state, deployed on the back of plunging costs, is finding its way into increasingly affordable electric vehicles. The implications are exhilarating for the environment, but absolutely devastating for the oil industry, the existing car industry, and all the infrastructure that is leveraged to oil and gasoline.
But let’s not get ahead of ourselves. Oil Fall doesn’t attempt to model or forecast global oil demand declines, which may not come until the mid-point of next decade. While analysts waste their time trying to figure out, for example, when EV will ultimately take all market share of new car sales, for example, this series will concentrate on the first blow: when oil demand growth falls to zero. That single change alone will do plenty of damage— not only to oil, but to the oil industry’s influence and power.
Oil Fall is a three part series that will publish over the course of 2018. © All rights reserved by the author and TerraJoule Publishing. Fair use of quotes from Oil Fall are permitted, with citation of Oil Fall as the source, and the author’s name, Gregor Macdonald.
Oil Fall is released in PDF form on the Gumroad.com platform. All sales conducted through Gumroad.com only, and buyers will see a charge from Gumroad on their statements. Oil Fall is best rendered at 100% in Adobe Reader.
Oil Fall: Part One, California ICE