Energy Crisis and Social Crisis: The So-called “Energy Transition”

March 13 2014

by Miquel Amoro?s

Energy crisis and social crisis – Miquel Amoro?s

An essay calling attention to the crucial importance of energy resources and technologies in modern society and the looming energy crisis that the author predicts will be the opportunity for real social renewal based on libertarian and ecological principles.

Energy Crisis and Social Crisis – Miquel Amorós

Every sector of the economy depends on it: energy of one kind or another. Energy makes the world go round and the power that rules the world is linked to the way energy is produced and consumed. The capitalist regime did not really gain momentum until the steam engine and the energy produced by the combustion of coal could be harnessed to industry. The initial dependence on coal was the cause of the vast size and appalling filth of the first industrial factories and cities; as the basis of the productive process, this dependence was responsible for the centralization of the entire system and the intensive exploitation of labor power. The internal combustion engine and the turbine put an end to the rule of coal, but not to the basic characteristics of society that had been created by it. Although the generalized use of electricity and gasoline made production more flexible and extended the range of consumption, facilitating the decentralization of factory production and the unlimited geographical expansion of the cities, social development continued to proceed within the framework that had been established by “carboniferous” capitalism: not only was the model of concentrated and hierarchical power maintained, but it was further reinforced by the new technologies. The refinement of machine production only reduced the role of the workers in the productive process, intensified exploitation and stabilized the class order. The new technologies consolidated class society and reinforced the foundations of domination.

Petroleum and electricity allowed productive activities to be relocated far from primary energy sources, that is, they capitalized the world. The extreme separation between the production and consumption of energy made transport the main strategic factor and at the same time the weak link of the system. Any serious disruption in the energy supply would cause all of society to collapse very quickly. Capitalism cannot exist without an extremely robust privatized distribution network to connect energy sources, which are under the control of financial enterprises or state-based mafias, with their consumer hostages. The expropriation of energy resources is a most instructive characteristic of social inequality: the proletarian from this perspective is the person who does not have unrestricted access to free energy. This explains why the ruling class strives to maintain the private ownership of energy resources and thus to keep the population in the most complete dependence. By fighting against the socialization of energy resources, locally controlled power generation and distribution networks and consumption, the ruling class is simply defending its social status.

Without cheap, inexhaustible and easily accessible energy, industrial society cannot continue to grow. The ruling class became aware of this “energy reality” when oil prices spiked after the creation of OPEC in 1973. The response was two-pronged: on the one hand, massive investments in nuclear power; on the other, the arms race of the great powers that was required by geopolitics, that is, the art of controlling of the world’s main oil and gas fields. The militarization of the world became indispensable for the system’s survival. This was a deliberate choice: it was the only way that power and servitude could be maintained.

During the 1970s and 1980s the market economy was subjected to an intensive restructuring process. The new type of capitalism, based on major technological breakthroughs and the deregulation of the labor and financial markets, displayed the special characteristic, unlike previous types, of not being susceptible to self-management. Although the spectacular development of the forces of order and the methods of population control render the prospect of victorious popular revolts quite improbable, even if such a thing were to occur, these new developments make it likely that the new society would inherit the worst kind of situation. The expropriation of the means of production would not accomplish anything, since the system cannot be socialized, because those who would have to implement such a program would be compelled to reproduce all its features and all its defects. They would be forced to reproduce the social relations that such a system necessarily entails. Authoritarianism, bureaucracy, waste, techno-party-ocracy, division of labor, and the dependence and artificiality of a lifestyle based on the private automobile would remain intact if only the developmentalist tendencies and the form of property are changed, without changing the very nature of the system. The latter must be completely dismantled and reconstructed on new foundations. This will be the main goal of future revolutions.

In a context like the current one, so favorable for control and militarization, the state has become more necessary than ever, since absolute obedience to the ruling interests is no longer an option—it has become compulsory. The limited supplies of energy resources, entering into conflict with the unlimited demand unleashed by an expanding economy, resulted in an “energy crisis”, understood by those in power in terms of “security”. From that point on, any protest on this terrain would be interpreted as a serious threat and therefore it would be quickly suppressed. Energy security became the condition sine qua non of the globalized economy, and as a result, planning with regard to this question would not be subjected to any kind of debate. During the 1990s the world energy market became the pillar of globalization. Guaranteeing a sufficient energy supply, regardless of the social cost this might entail, defined the “sustainability” of the capitalist economy.

The developmentalist solution of the energy crisis was, first: the creation of international energy markets, which led to the expansion of supply and transport infrastructures; second, an across-the-board increase in the prices of fuel and electricity; and third, a whole package of policies: continuation of the nuclear power program, subsidies for industrial renewables, bio-fuel plantations, and the exploitation of shale gas. The destructive impact on the territory and the concomitant repercussions on people’s lives are the most important results of this crisis. A free life in a balanced geographical space will require not just a libertarian communist model of production, but an energy model based on the same principles.

The new sociological concept of “energy poverty”, coined during the 1990s, reflects the situation of a growing part of the population that cannot pay its utility bills despite the overproduction of electricity. This is due primarily to the constantly increasing price of electricity, an outcome of the peculiarities of the “liberalization” of the markets inaugurated in 1995, the subsidies for renewables and the costs of the “transition to competitiveness”, all of which encouraged speculation and indebtedness, leading to prices per kilowatt-hour far in excess of any reasonable level. We must not, however, overlook the fact that the peak of oil and gas production is a constantly looming threat that pushes prices ever higher, even without taking into account the price gouging of the utility corporations. What is taking place is not merely a simple problem of oligopolies that are illegally fixing outrageous prices by making the consumers pay for their reconversion costs; it is also a problem of the increasing scarcity of fossil fuels, a circumstance that these same oligopolies are exploiting to their advantage. However, in order to exorcise the horrifying specter of an economy without enough electricity, or, which amounts to the same thing, an economy with electricity that is too expensive, because there is not enough oil or gas, the world’s leaders have conceived of a new strategy, that is, the “energy transition”.

This energy transition does not consist in a return to the nationalization of the energy sector, but rather, on the one hand, in financial incentives for investments in nuclear power plants utilizing a pseudo-renewable pretext, and, on the other hand, in the resort to the extractive technology of hydrofracking. The only kind of nationalization that is being contemplated is that of the costs incurred by the construction of nuclear power plants and new energy infrastructure. This is a kind of partial eco-capitalism, vigorously supported by the green parties, who put their faith in industrial renewables, and even more so by international institutions, whose goal is to reduce the share of fossil fuels in world energy consumption, or at least to control their prices, while maintaining high rates of economic growth. The key to this conception appears to be the free market in energy, energy savings, efficiency plans, energy deposits that have yet to be discovered, and expected technological innovations, all of which are very speculative and uncertain. The alleged effectiveness of fracking has helped to hold down prices during a favorable economic conjuncture characterized by declining demand. The profitability of energy resources, however, is undergoing an even more precipitous decline. Just to get an idea of how much it is falling, we can refer to the Rate of Return for Energy, the RRE—the relation between the quantity of energy obtained on average and the energy used in the extraction process—for conventional oil the RRE is currently 20 to 1 (in 1930 it was 100 to 1), and for non-conventional oil or gas it is only 1.5 to 1. In comparison, the RRE of traditional agriculture, without machinery, was 10 to 1. Since the RRE will continue to decline as the exploitation of new deposits proceeds, the energy crisis will continue to get worse and prices will continue to rise even in a stagnant economy, resulting in “energy” poverty and exclusion for increasing percentages of the population, until the time arrives when this crisis converges with other crises and becomes a social crisis.

The energy question is therefore an element of the greatest importance in the anti-developmentalist critique, since a reconstruction of society without either Market or State must herald a decentralized and efficient production of renewable energy, preferably of communally owned resources, if we do not want separate power to re-emerge in association with fuel sources. Above all, however, because this society will arise from a struggle over energy that will not take long to arrive.

Miquel Amorós

Notes for presentations delivered on January 12, 2014 at the C.S.O. La Gatera, in Tavernes de Valldigna, and on January 24, 2014 at the Hegoetxea de Irala (Bilbao).

Translated in March 2014 from Spanish text provided by the author.