No wonder city staff don't know what to do with Richard Gilbert's peak oil report; adopting it would mean throwing out most of Hamilton's long-term growth strategy.
(This is part one of a two-part series on Richard Gilbert's vision for Hamilton. Part one looks at the implications of peak oil and peak natural gas for Hamilton's growth strategy. Part two discusses transportation, goods movement, and building energy use in more detail, focusing on Hamilton's opportunities in energy production and conservation.)
In gambling, continuing a losing strategy because you don't want to forfeit what you've already wasted is called "chasing your losses". I see a parallel in the city's ongoing denial of how climate change and declining oil production are going to grind Hamilton's long-term growth strategy to a halt.
Last June, City Council voted to hire an energy policy expert to assess Hamilton's plans for aerotropolis, public transit, city fleet, and goods movement in the event of rising energy costs. The job went to Richard Gilbert, the research director at the Centre for Sustainable Transportation and a transport consultant to the Organization for Economic Cooperation and Development.
Gilbert delivered the report to city staff last fall, but they have refused to share it with City Council, indicating that they had asked Gilbert to make some changes to the report before finalizing it. According to Gilbert, it should be released some time this month.
Last summer, I had the pleasure of meeting with Gilbert to discuss his ideas about peak oil, peak natural gas, and ways that Hamilton might thrive in what he calls the "energy-constrained world" we face.
He explained that between current gas prices and $2.50 per litre, the price shift alone wouldn't cause much change to Hamiltonians' way of life. People may replace their cars with smaller, more efficient models, but life will mostly go on as it has.
However, gas above $2.50 a litre starts to trigger some more basic changes in people's choices of where and how to live. At $4.00 a litre, our current situation becomes impossible to maintain. The big question for Gilbert was whether gas prices would reach that level within the city's twenty-five year planning horizon.
When we spoke, he was still in the research phase of his report, and suspected that the likelihood of gas exceeding $4.00 a litre was fairly remote. As he explained to me, "I think some people will be disappointed in my report." He planned to recommend that City Council continue with its GRIDS process but be sure to have a "Plan B" and a way to change direction mid-stream, just in case.
While Gilbert's report is still secret, he did agree to speak at Environment Hamilton's Annual General Meeting on March 30, and he sketched out his projection for future energy trends and his vision for the city. He stressed that his presentation was not his report. Nevertheless, both were clearly informed by the same research.
By 2018, halfway through Hamilton's planning horizon, supply shortages could raise oil prices six-fold
The biggest change since last summer is that Gilbert considers the energy situation to be much more dire than he had previously thought. Last year, he considered $4.00 a litre gasoline in 25 years to be a pessimistic scenario; today, he considers it optimistic. In fact, comparing project growth in demand with the best evidence on projected declines in supply indicates a 25 percent shortfall in supply as early as 2018, twelve years from now.
A 25 percent supply shortfall would drive oil prices up six times above current rates, pushing oil prices far beyond the $4.00 mark. As a result, he now believes Hamilton should make local energy production and conservation its Plan A.
Looking at the implications of Gilbert's thesis, it's no surprise City Council doesn't know what to do with the report. Adopting it would mean throwing out most of Hamilton's long-term growth strategy:
Don McLean recently observed, "the City consulted with the public about the principles to guide its 30–year plan. But then an independent City–commissioned review found the aerotropolis violates seven of the nine principles. In response, council voted to make the aerotropolis an automatic part of all six options being considered for the 30–year plan."
Nearly all of Hamilton's economic growth is supposed to take place via aerotropolis development spurred by air transport. Gilbert counters, "I don't have much hope for aviation in an energy-constrained world." With energy costs per tonne-kilometre that are a hundred times higher than shipping and rail, the growth in air transport is mostly an artifact of the very low real oil prices of the 1990s and the computer software dot-com boom.
Mass air travel will not survive a six-fold increase in energy costs. As it is, most North American airlines are struggling to remain profitable, losing money, going into bankruptcy, or just coming out of bankruptcy. Whatever role air travel plays in a post-peak economy, it will not provide a significant multiplier effect to businesses located around airports.
Hamilton's Goods Movement Study, published in 2005, assumes continued growth in the energy supply, calling for a network of highway improvements that further develop the "ring road" architecture of the postwar era. Despite its extensive rail connections and proximity to the largest freshwater shipping route in the world, the downtown core received scarcely a mention in the study.
Goods Movement in Hamilton: building the killer skateboard ramps of tomorrow (Photo Credit: City of Hamilton)
Gilbert's study focuses heavily on the role that "tethered" vehicles, powered by electricity and connected to the electric grid, will play in meeting Hamilton's future transportation needs (more on this in part two). Clearly, the current GRIDS recommendations move in exactly the wrong direction.
Today, Hamilton doesn't have a strategy for its public transportation system. City Council deserves credit for listening to constituents and rejecting the staff recommendation of a fare increase in its recent budget deliberations. Every year fares do not increase, they actually fall in real (inflation adjusted) terms, which means transit is becoming steadily more affordable. This in itself has proven to increase ridership, which is the goal of transit improvements.
Still, the city can do this only because the provincial government allowed Hamilton to spend its gas tax rebate on transit operating costs. That money is supposed to pay for capital improvements. The HSR's busy lines are already running over capacity (standing room only) and in many cases, packed buses pass bus stops with passengers waiting. The problem of "drive-bys" is getting worse, and the only way to alleviate it without reducing ridership is by increasing capacity.
City staff are reluctant to spend money on new buses precisely because rising energy costs are expected to increase the operating costs of the fleet. However, if the price of oil does jump six-fold in the next twelve years, Hamilton is going to need a robust transit system that can carry all those extra passengers or else the city will effectively shut down.
Hamilton's growth strategy recommends 40 percent infill development and 60 percent greenfield development, the bare minimum allowed under Ontario's Places to Grow legislation.
When we spoke last summer, I asked Gilbert how to persuade people to change their living and transportation patterns, and he replied that he doesn't think it's possible. As long as driving remains affordable, people will continue to drive.
All cities can do is create environments that encourage walking, cycling, and public transit by making them as easy as possible. I pointed out the obvious: sprawl development does precisely the opposite. He agreed, but cautioned that that first suburbs in history were transit suburbs, served by streetcars and trolleys that carried suburban residents to their downtown jobs.
Even though newer suburbs are farther from the centre of town and have lower population densities, Gilbert referred to a study he helped conduct in the 1980s that determined public transit would be cost effective at much lower densities than it is today as long as people don't own cars. If everyone had to take public transit, there would be enough riders even in low-density sprawl neighbourhoods.
Hamilton's current GRIDS strategy assumes oil supplies will continue to grow for at least the next 25 years. Based on the best available data, oil supplies will begin to contract after 2012.
World Peak of Liquid Hydrocarbon Production by Source
In the past, this city has plunged ahead with ill-considered plans despite abundant evidence to the contrary. So far, the GRIDS process is much the same; constrained by political imperatives, like Aerotropolis, that are not up for negotiation.
It remains to be seen whether the city will continue to chase its losses in land use and transportation by ignoring Gilbert's Peak Oil Report and lunging heedless into a future where the baseline assumptions behind unlimited driving and air transport will not longer apply.
Hamilton needs to make energy conservation and production its civic mission.
If this argument that higher prices is accepted ... a reasonable conclusion is that the City of Hamilton should transform rather than merely add to its current planning processes. The transformation should be one that puts energy concerns first and centre in all its planning. [emphasis added]
-- Richard Gilbert, Hamilton: The Electric City, Report to City Council, April 13, 2006
In the April 9 issue of RTH, I wrote about Richard Gilbert's planned report to City Council on peak oil and natural gas. That essay reviewed Hamilton's GRIDS planning process in the light of the "energy-constrained world" that we face; this essay will review Gilbert's vision for how Hamilton can plan for - and benefit from - that energy constrained world.
Gilbert's two goals are to insulate Hamilton from energy scarcity and to grow Hamilton's local employment opportunities significantly. Gilbert's report outlines four strategic objectives he believes Hamilton should pursue to achieve these two goals.
Whereas energy prices in general will at least quadruple according to Gilbert's research, Hamilton can hold its energy spending to only double what it is today, a price that will allow Hamiltonians to enjoy relative prosperity.
Gilbert writes, "These four objectives would both define a civic mission for Hamilton and act as a prism through which to view other initiatives." In other words, Hamilton should frame its decision making around whether a given initiative a) generates energy, and b) conserves energy.
He notes that GRIDS has already identified what he calls "the prospect of severe energy constraints" in its Transportation Energy Use and Greenhouse Gas Emissions Policy Paper or January 2005, which forms part of the background for Hamilton's Transportation Master Plan.
He also points out that Hamilton's Vulnerability to Climate Change, a GRIDS background paper published in September 2004, raises similar concerns.
This is an important point: warnings about the sustainability of Hamilton's high energy flow-through economy are coming from numerous sources. Until now, these warnings have not been coordinated, despite the purpose of the GRIDS process, and have not had much influence on Hamilton's economic planning process. Gilbert makes a compelling argument that this needs to change if Hamilton is to stay ahead of the coming wave.
Gilbert's first objective is to reduce per-capita energy use by two-thirds, for transport and in residential, commercial, and institutional buildings. Doing this will require that the city become denser, more mixed, and more deeply connected by transit. It will allow Hamilton to have an economically successful future while other municipalities that do not prepare will be left in the cold, stuck with transportation infrastructures and building designs that can no longer run in a cost-effective manner.
Gilbert recommends changing the mix of personal vehicles, public transit, and human powered transit, and by introducing some new modes.
Early on, he dismisses fuel cells as a viable technology for running our fleet of personal vehicles:
in an energy-constrained world it will make more sense to use electricity directly rather than to use it to make hydrogen that is then used in a fuel cell to make electricity. In the first case, the energy loss is about ten percent, chiefly line losses during distribution. In the second case, the energy loss is 75-80 percent.
This rules out fuel cells as a widespread alternative to today's internal combustion engines. Fuel cells are simply far too inefficient, due not to technical shortfalls but to physics: every time we transform energy from one form to another, some energy is wasted.
After the electricity is generated, converted from to AC to DC, and electrolyzed to produce hydrogen (the electricity is used to split water into hydrogen and oxygen), and the hydrogen is packaged, transported, and converted to a fuel cell, and the fuel cell generates DC, which is converted to AC again, the accumulated efficiency losses amount to 80 percent of the total energy produced, meaning only 20 percent is available in the motor.
By contrast, a grid-connected, or tethered, vehicle uses AC electricity right off the grid, cutting out the electrolysis, transfer, conversion to fuel cell, conversion to DC, and then back to AC. As a result, it enjoys 90 percent efficiency rather than 20 percent efficiency.
Fuel Cells v. Tethered Vehicles: Fuel cell powered vehicles lose up to 80 percent of the original energy generated, whereas tethered electric vehicles lose only ten percent.
Calgary has installed a light rail transit system that is powered entirely by wind. (To be precise: the transit system draws from the electric grid and the wind farm feeds into the grid, so that the wind farm produces as much electricity as the transit system uses.) This is an excellent example for Hamilton to follow.
Gilbert believes Hamilton can bridge the gulf between personal vehicles and grid-connection via some form of personal rapid transit (PRT): grid-connected cars that run on dedicated guideways. If any part of this report can be considered gee-whiz futurism, this is it.
It's too early to say whether PRT will be viable and what form it might take. Vehicles may be privately owned or shared; riders may drive the vehicles or they may be computer-controlled; vehicles may connect in trains (to reduce wind resistance) or run individually.
Gilbert also believes that avoiding vehicular trips will play a role in reducing our energy use. Gilbert notes the enhanced role of bicycle lanes, smart commuting, and teleworking. I would add mixed land use so that destinations are brought closer together.
Buildings actually consume more energy than transportation. In Hamilton, most of the buildings in which we will live and work in 2030 have already been built. Obviously, new buildings should be constructed with much higher energy efficiency standards than apply today, but the vast stock of existing buildings also means Hamilton will have to undertake an aggressive retrofitting campaign to reduce the energy consumption of existing buildings by 50 to 75 percent.
Home energy use breaks down to: electricity for lights and appliances, energy for heating and cooling, and energy for water heating. While the total amount of building energy use falls, electricity will make up a much larger share across all three uses.
Heating and cooling can be achieved through passive solar energy collectors, deep lakewater cooling, and geothermal heating/cooling. Buildings can also achieve greater conservation through more efficient appliances and lights, programmable thermostats, zoned heating/cooling, off-peak energy use, and more efficient use of existing facilities (e.g. turning off lights when not in use).
Gilbert sees the City of Hamilton's role as "that of enabler, i.e. creating the conditions for particular activities to occur" rather than performing those activities itself. The city's tools can include tax incentives and disincentives, negotiated bulk purchases of retrofitting services, permitting for retrofits, and, of course, pursuing an economic strategy that emphasises energy.
Gilbert's second objective is for Hamilton to generate all the electricity that it uses, and his third objective is to generate half the non-electrical energy that it uses. Today, Hamilton generates almost no energy, which means it must import nearly all of its energy from elsewhere. The money spent on electricity in Hamilton does not stay here and cannot be reinvested.
When every electron counts, it makes sense to generate electricity close to where it will be used, as distribution losses that seem trivial today may assume more importance as the total supply of energy is increasingly constrained.
The three most promising ways to generate renewable electricity are wind turbines, solar photovoltaic (PV), and incineration. (Incineration is a controversial option and warrants its own treatment, to be published in our next RTH issue.)
Wind turbines are already cheap to manufacture and provide years of electricity. Today, wind turbines can generate electricity for about five to seven cents per kilowatt-hour, a price comparable to natural gas fired power plants. As noted above, Calgary runs its light rail network on wind energy.
A strategy in Hamilton could include offshore wind farms, turbines installed on farmland - which provides farmers with additional revenue streams and preserves local food production - and in urban areas. A new generation of vertical axis turbines are lightweight and have low vibration and noise, making them suitable for rooftops.
Solar energy is expensive today, but its efficiency is improving, its price is falling, and it will become increasingly competitive as conventional energy sources become scarce. Many buildings have enough horizontal and south-facing surface area to generate most of the electricity they use. On average, using today's technology, rooftop PV can generate 43 percent of the electricity a building uses.
A major retrofitting exercise could install solar collectors on buildings across the city, leveraging surfaces that currently do nothing.
Gilbert's principles of land use for an energy constrained world are entirely consistent with the Ontario Government's Places to Grow framework, which emphasizes infill rather than greenfield development. In theory, Hamilton is also committed to these goals, but today's GRIDS process pays lip service to infill without really transforming Hamilton's sprawling tendencies.
Here are his principles:
I can't emphasize enough that Gilbert's land use principles are entirely consistent with the GRIDS Guidelines - much more so, in fact, than the actual plan that has grown out of the GRIDS process and represents an ineffectual compromise between what Hamilton needs to do and what Hamilton's homebuilding industry prefers.
Let me close this report with Gilbert's exhortation to City Council to be inspired and to face our challenges head-on: "Think big, as people in Hamilton did a hundred years ago."