What is Energy?

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Since the introduction of internal combustion engines, petroleum has played an ever-increasing role in our lives. The estimates of petroleum resources and its remaining life have been very crude at best. Following WWI, US geologists estimated that US petroleum reserves would only last for 30 to 40 years, but in the mid 1920s the predictions changed after the discovery of huge oil deposits in Texas and Oklahoma. In fact, the huge petroleum surplus forced oil companies to sharply lower their prices, which made Middle Eastern oil largely irrelevant for many decades. (1)

With the mass production of internal combustion engines, the rapid rise in consumption of petroleum, and the nationalization of oil industries by several major oil-producing countries in the 1950s and 1960s, new concerns arose over the long-term availability of oil reserves. In 1970, the Club of Rome, an international think-tank of scientists, economists, businessmen and political leaders commissioned a study which focused on the earth’s physical limits to investigate the long-term economical and environmental consequences of the prevalent patterns of population and consumption on the depletion of natural resources. The result of the study was published in a book entitled The Limits to Growth (2), and concluded that unless major steps were taken to limit population and slow industrialization, natural resources would quickly deplete, resulting in global economic crises, famine, and irreversible environmental damage.( a ) Based on their model, at the prevailing rate of growth, within a time span of less than 100 years, the world’s population is expected to increase to 10 billion, per capita food production to drop by three quarters, pollution to increase tenfold, and all of the oil and gas supplies would deplete. ( b )

In 1973, following the Arab-Israeli War and the oil embargo by the Organization of Petroleum Exporting Countries (OPEC), and again in 1979, as a result of the Iranian Revolution, the doomsday scenarios predicted by earlier forecasts seemed to become even more authentic, and within a decade the price of oil increased sharply (Figure 1).

 Crude oil prices since 1870 adjusted to 2007 values.
Figure 1: Crude oil prices since 1870 adjusted to 2007 values.


The higher price of oil brought a profit windfall for oil companies, but also a major recession throughout the world. As the oil scare spread, so did calls for development of alternative sources of energy and higher efficiency. It also accelerated the search for new petroleum resources, which eventually led to the discovery of new oil fields in the Caspian Sea, Africa, the North Sea and Mexico, which caused oil prices to drop once again.

To prevent prices from falling, OPEC countries cut production, putting an even greater burden on its member countries that heavily depended on oil revenues for their economic livelihood. To boost their revenues, some countries actually sold their oil below market prices and at volumes above the limit set by the organization. The problem became so widespread that OPEC lifted the quotas by the mid-1980s. Since then, OPEC has tried several times to manipulate the prices by limiting production. Their attempts have failed every time, however, because they could not agree on a unified pricing policy and because developed countries made the transition to other resources such as coal, gas, and nuclear power.

As we begin the twenty-first century, energy has once again become a primary concern. A six-fold population increase during the past century and higher energy demands by developing countries, along with the rapid depletion of fossil resources have resulted in new tensions, that began with the 1991 invasion of Kuwait by Iraq resulting in the First Gulf War and continued with the US invasion and occupation of Iraq in 2003. It appears that unless concrete steps are taken to decrease the dependence of the industrialized world on foreign oil imports, many more wars will be fought and regional conflicts will continue to destabilize the world for many decades to come.

It is impossible to consider issues related to energy without looking at its effect on the environment. As we put more and more pollutants into our atmosphere, primarily as a result of human activity and the increasing use of fossil fuels, we are also affecting the earth’s climate. When burned, fossil fuels produce carbon dioxide, nitric oxides, carbon monoxide and other harmful gases. Most of these gases adversely affect human and animal health and degrade material property. They are also the primary cause of depletion of ozone in the stratosphere and formation of acid rain and acid fog in the troposphere. Carbon dioxide is not considered a pollutant by most; however, it has a blanketing effect that prevents heat from escaping the atmosphere, causing the environment to warm up.

As petroleum resources are used up, we must switch to alternative sources of energy. Unfortunately, the public so far has shown little interest because the cost of utilization of these resources is higher than those of conventional fuels. How quickly we will be able to meet challenges posed by depleting non-renewable energy resources and the deteriorating environment depends on the way we measure the cost to society and on how far we are willing to go to level the playing field by transferring these costs to energy producers. For example, costs associated with petroleum are not limited to the transactions borne by the buyers and sellers. The true cost must include military costs associated with oil security, various subsidies to oil producers and customers in term of tax breaks and other exemptions, and environmental and health damage resulting from fossil fuels. If the polluters are forced to pay for these damages and if the many fossil fuel subsidies are eliminated, prices will have to be raised, which may help to encourage better efficiency through the use of more environmentally friendly “green” products.

Different approaches have been suggested to internalize these costs. Some economists propose the passage of additional “nuisance laws” that allow the public to sue for damages caused by reckless release of noxious emissions and toxic pollutants into the atmosphere. Two examples that they often cite and have had some success within the last few years are the costs incurred by tobacco companies to pay for health damages caused by cigarette smoking and the clean-up of the Exxon Valdez oil spill in Alaska.

Environmental activists are pushing for a “carbon tax” to account for future costs of climate change and to cover other health costs and damage to the environment. How much the cost will be and how much tax should be levied is very difficult to predict. No matter which approach is adopted, polluting companies are far from being supportive of these measures; they spend a lot of money to fight against lawsuits and new regulations that limit their activities, ultimately passing the costs back to the customers and making the battle a difficult one to win.


What is Energy?

Energy is generally regarded as the single most important concept in all of science. Human cultures are defined largely by their uses of energy resources. Every interaction in our universe involves a transfer of energy between two points or a transformation of energy from one form to another. The word “energy” is bandied about so often that we normally take its meaning for granted. We hear people described as being “full of energy,” the world as having “an energy crisis,” and the need to “conserve energy.” Despite the immense impact of energy on our lives, the term “energy” does not lend itself to a simple definition. The difficulty in producing a precise definition for energy is derived from the fact that energy is a concept, an abstract idea, and not a material object such as an apple or a tree. As Heinberg points out in his book The Party’s Over, (3) “few understand exactly what energy is and yet we know that it exists. Indeed, without it, nothing would exist”. We can extend this description to define energy as what is required to make anything happen. Given that, energy must be defined indirectly, in terms of what it does or is capable of doing. In fact, the presence of energy is revealed only when changes take place.


(1) Mann, Charles C., Getting Over Oil, MIT Technology Review, January/February 2002.

(2) Meadows D., The Limits to Growth: A Report for the Club of Rome’s Project on the Predicament of Mankind, Universe Books, 2nd Ed, 1972.

(3) Heinberg, Richard, The Party’s Over: Oil, War and the Fate of Industrial Societies, New Society Publishers, Gabriola Island, BC, Canada, 2003

(4) Toossi, Reza. "Energy and the Environment:Sources, technologies, and impacts", Verve Publishers, 2005

Additional Comments

(a) The model assumed exponential growth for the rate of population increase and consumption of depletable resources, but a fixed source of supply, which necessitates an eventual collapse. Models such as this are widely referred to as “pessimist”, or “neo-Malthusian” models.

(b) It should be noted that this point of view had its own critics. For example, Kahn, H., et al [The Next 200 years: A Scenario for America and the World, William Marrow, 1976.] argue that human ingenuity will, at the critical moments, intervene to devise technologies that can assure continuous development and better use of resources. Therefore, according to these technological optimists, resources are not finite but grow as needs arise. As we will argue throughout the book, we believe even with technological innovation and, at this time, additional unknown resources, the resources can eventually run out and we will, sooner or later, have to face the unwanted consequences of our resource mismanagement.

Further Reading

Meadows, D. H., et al., The Limit to Growth, Universe Books, 1972. Also see, The Limit to Growth: The 30-Year Update, Chelsea Green Publishing Company, 2004.

Diamond, J., Collapse: How Societies Choose to Fail or Succeed, Penguin Group, USA, 2004.

Cleveland, C. J., Encyclopedia of Energy, Elsevier Direct Science, 2004.

The International Journal of Energy, Science Direct Elsevier Publishing Company.

Applied Energy, Elsevier Publishing Company.

Journal of Energy Resource Technology, ASME International.

The Energy Journal, The quarterly journal of the IAEE’s Energy Education Foundation, (http://www.iaee.org/en/publications/journal.aspx).

External Links

Energy Citation Database, US Department of Energy (http://www.osti.gov/energycitations).

Environmental Protection Agency (http://www.epa.gov).

US Department of Energy (http://www.doe.gov).

The NIST Reference on Constants, Units, and Uncertainty (http://physics.nist.gov/cuu/Units/index.html).

The Club of Rome (http://www.clubofrome.org).

The Sierra Club (http://www.sierraclub.org).