Power Laws, Bell Curves & The Death Of Rationalization - Energy Bulletin

[hatrack]

Interesting article.

EDIT

The structures of these two types of networks (the highway network as described by the normal distribution and the air network as described by power laws) are thus very different. Which brings us to the concept of peak oil, centralization and localization. In former times, slaughterhouses, bakeries, breweries and dairies were small, numerous and more or less evenly distributed across the country (just like roads are). Now they are big and they are located to only to a few places. According to the Swedish National Food Administration there exist (only) 25 “large-scale slaughterhouses” in Sweden that they oversee (and some of these slaughterhouses are – in line with the power laws - very much larger than others).

Six of these 25 Swedish slaughterhouses are run by Scan, one of northern Europe's largest food companies (working mainly with meat). As if by coincidence, I read in a Swedish trade journal (“Agriculture News”) that one of Scan’s six facilities (in Uppsala) will be closed and that most of the activities at another facility (in Skara) will disappear in the near future. "The slaughter and butchering of cattle and sheep be centralized to Linköping and the slaughtering and butchering of pigs will mainly be located to Kristianstad. <...> Total headcount will be reduced from 3 000 to around 2 500. Some of the employees may be offered jobs at one of the locations where activities will be centralized." In a column in the same issue of Agriculture News, the journalist Erik Brink writes appreciatively about Scan’s plans for restructuring their business: 

"closure of all slaughter in Skara is just the next step in Scan's crusade to get the Swedish meat producers to better adapt to market conditions. All old emotional trash will be cleared out and only that which makes business sense will remain."



"Adapt to market conditions" is in this context equivalent to going big and "large-scale". If you follow the transports going to and from these (currently) 25 large-scale slaughterhouses you will see that they are hubs with many long transports going to and from them (similar to the air network). There has been a push to rationalize and scale up the size of plants for decades, always moving towards an equilibrium that basically depends on the relationship between the cost of energy and the cost of labor. Energy has been cheap and labor has been expensive. In the search for higher profits, the tune has been to scale up operations by rationalizing, streamlining, concentrating, consolidating and slashing jobs - despite the fact that increased concentration also leads to increased vulnerability and longer transports. As energy has been cheap and the supply has been stable for decades, there has been little reason for any afterthoughts... until now. 



Because what will happen if energy becomes more expensive in the future? What if the relationship between labor and energy will change radically (albeit gradually) after peak oil? I do not mean that gasoline prices (or the price of electricity) will go up with 10 – 20 – 50 – 100 percent, but that the relationship between labor and energy will change fundamentally. Human ecologist Folke Günther has made a graph that shows how many seconds a Swedish industrial worker has had to work in order to buy a kilowatt-hour of energy in the form of gasoline at the gas pump:

EDIT

http://www.energybulletin.net/51140

[hunter]

1. Good news if you are going to hire house servants...

... and bad news if you are going to be one of those house servants (much more likely.)

And a glass of the local ale will cost less than a can of Bud Light which is good news if the local brew is a good one, but bad news if the local brew is worse than Bud Light.

Interesting article.

[Bigmack]

5. Local brew WORSE than bud light....

I SERIOUSLY doubt it! Ms Bigmack

[TxRider]

2. Higher energy prices will simply cause a new shift

We've seen it before.

From animal based transportation, to steam rail transport and then to fossil fuel rail and then road transport we have examples of modes and costs of transportation that drove several shifts along the way.

There are thousands of small towns that sprouted along the rail lines back in the days of predominant rail transport. They displaced many towns that grew along river fords and other animal based transportation corridors. If your town wasn't on the railway, it died.

They now stand mostly deserted as populations shifted to the roadway hubs as paved roads and bridges sprang up, most notably the interstate highway system that along with cheap fuel prices replaced rail transport as the predominant transportation system. Commerce died by the rails, and grew along the interstate highways. If the town wasn't on the interstate, it died.

As transportation costs grow, production will likely shift again back to more localized distributed models, and more efficient transportation like rail transport may become more predominant again and populations shift back tot he rail stop towns that stand empty.

Centralized production using long distance transportation has been cheaper than distributed production due to low cost of transporting goods. If that transport cost rises enough localized production without need for transport can compete again. As well transportation will possibly shift back to more efficient means like rail. Driving shifts of commerce.

For example take Taylor, Tx. Just an interesting case as it's a town I happen to drive through a few times a year.

It got the big rail hub and sprouted into a decently large city...

In 1906, booming rail hub. all produced goods, food, manufacturing whatever, came to Taylor and the railroad for shipment. Those bringing goods bought goods to take back home. Commerce was good.



1940's, as the highways grew, and more or less mirrored the rail system connecting rail stop towns, little changed.



1990's after the interstate highway system bypassed the town 40 miles away, commerce shifted from rail to big trucks, and farmers and manufacturers and buyers of goods shifted commercial activity to Temple, Tx. on the new interstate highway system.




The nearby town of Temple, however, having the interstate highway pass through it and has now boomed from a small town to many times the size of Taylor.

Were transportation to shift back to predominantly rail and away from Interstate highway trucks, Taylor would benefit much.

If we devise a way to maintain the cheap cost of road based truck transport we now use as oil becomes more scarce and expensive, things will continue as they are.

Commerce and an economy always seem to revolve around the transportation system, and the cost of transportation and shift with it in form as well geographically. Even as far back as the age of discovery displacing the overland transportation in the spice trade and the far reaching shifts that created that shaped our world.

Increased fuel cost will also shift our trade balance in foreign goods, in both directions.

[kristopher]

3. Good example. nt

[phantom power]

4. I'm not sure comparing roads with airports is quite right...

The number of roads leaving any town or city is limited more by 2D constraints.

For example, plotting city population sizes yields a power law, and I bet that if one plotted volume of traffic in/out of a city, that would yield a power law. Both of those are more on an even playing field with airports.

[pscot]

6. This is the one big idea

that should be tattooed inside the eyelids of every politician and B-school grad before they're turned loose on the world. Kunstler has been harping on this theme for years.