Written By: - Date published: 12:55 pm, June 25th, 2008 - 60 comments
Categories: economy -
Tags: peak oil, petrol price, roading
Petrol is over $2.10 a litre. The price will keep rising both with the ever upward march of the price of crude and the falling NZ dollar. Already, motorists are responding. Road usage in Auckland has fallen 3%. It’s fair to believe it is falling elsewhere too. The only reasonable conclusion is that the number of vehicles on the road will keep edging down as the price of petrol continues to rise.
So, why the hell are we spending $3 billion on two huge new motorway projects? The Waterview Tunnel in Auckland and Transmission Gully in Wellington add capacity to the existing network even as capacity demand is falling. That’s insane.
Yes, there is still congestion on the motorways out of the cities. But the solution is to take more cars off the road. Imagine if we put that $3 billion into public transport instead we could build a world-leading transport infrastructure with numerous small, comfortable, quick buses and faster, electrified trains.
Both major parties are stuck in a past of cheap oil. Those days are not coming back; it’s time we had a transport plan for the future.
[PS. before the Righties get all excited - no, this $3 billion couldn't pay for National's tax cuts. A motorway is built once, tax cuts are forever.]
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Wow, what a retarded post. We are sill going to need cars. People are still going to drive no matter what the cost. You know the Aussie is about to start mining oil deposits in rock and Canada is stepping up it’s sand mining operation. There will be oil for many years to come.
200 years worth is predicted. The sands in Canada hold more oil that the arabs.
Wow, what a retarded comment. No-oneis saying dig p the existing roads. I’m saying that the price of oil is going up and up and car use is decreasing, meaning there’s no need for massive new projects.
Infused: and the Canadian sands are considerably more expensive to extract oil from. Which is what everyone is talking about when they say ‘peak oil’ – the planet will never run out, but the cost of marginal cost of production will be greater than market price. When this happens, production shuts down. Savvy?
What SP is trying to say is that by strengthening the inter and intra-city public transport networks, pressure on existing infrastructure will ease. You don’t need to build a new highway if you can convince even 10% of the car-drivers to take new and efficient public transport. That way, the retards still willing to pay $4 a litre of gas can still drive wherever the hell they want.
Bah. “but the marginal cost of production” – must have had two half-sentences in my mind.
infused: What grades are the oil you’re talking about? Your statement is basically useless unless you are simply trying to confuse the issue.
From memory the Albertan oilsands are essentially tar. Great if you want to produce plastics, adequete for some types of heating oils, and absolutely useless for getting light fractions required for motor vehicles.
What is the price for extraction and refining? That is the important question. There are hydrocarbons everywhere from coal deposits to the underwater frozen methane. Almost all of them could be converted into the petroleum factions we use for motor fuels, but in most cases the costs are orders of magnitude greater than what we currently pay.
I’d suggest that if you don’t have any ideas on these rather critical questions (which is what I suspect), then your opinions just show you need some remedial science.
Ah, but there’s always going to be alternative fuel/energy sources coming out.
Whether or not they come in the next 5, 10 or 15 years.
If it takes 10 years, all thats needed is a few contractors to clear the weeds, cover over the cracks, and presto, new road for our water/urine/hydrogen/electricity fuelled cars.
I suppose one could say it’s “forward thinking” in the “old style” but still.
At least the buses will be on time, all the time, and wouldn’t have to cope with idiot drivers trying to overtake them as they’re pulling out.
3 billion on a road is a shocking amount. Do we have monkeys counting peanuts dealing with the contracts? I hope we have some sort of penalty clause included, which always seems to be lacking.
captcha: predict new; Oil sources perhaps?
Nedyah: of course there are, but that doesn’t mean that investment in public transport can’t extend the life of existing transport infrastructure by reducing usage. I’d love to take the train north instead of driving (Especially if I get to avoid the Kapiti Coast highway and the Desert Road) but it’s not the most viable option at the moment.
Captcha: and gasoline. Some of these are creepy.
“In the words of Mary Beth Stanek, director of energy and environmental policy & commercialization at GM, “Developing and growing hydrogen infrastructure is vital to GM’s efforts to bring larger volumes of fuel cell vehicles to the market.’ ”
GM Volt
The car is not dead, fossil fuels might be dead but personal transport is not going to give way to mass transit anytime soon, especially in low density cities like Auckland.
Bus riding Wellingtonian policy wonks might want to punish the rest of us by forcing us to ride buses ( in addition to just paying for them with taxation) with smelly Gold card holders but it ain’t gonna happen.
["smelly Gold card holders" charming. SP]
Steve P: Isn’t $2billion of that $3 billion just a bribe for the Helen Clark’s Mt Albert electorate ? Now that is a bacon sandwich !!!
So, why the hell are we spending $3 billion on two huge new motorway projects?
Because road planners have to look at a longer term than what petrol prices are doing this month. Sudden price increases cause a shock that reduces demand. Give it a while and demand goes back where it was. The idea that this is the start of some permanent and significant fall in road usage isn’t very convincing – people are very resistant to reducing car usage long-term.
Oddly enough, I agree with Bryan. In part anyway.
Oil might be on the way out, but I don’t think personal transport will follow it.
However, I do think that we’re not going to need new roads for a long time. Traffic density (in person/second) can be increased by an order of magnitude with smarter vehicle systems (i.e. take drivers out of the picture, because they suck). In the meantime oil will, as you point out, keep traffic densities down for us.
No new highways!
How is ruining your electorate with the construction and disruption required for a massive tunnel a “bribe”?
Stephen: because it’s a lot less disruption than bowling 600 houses of Labour voters and digging a trench.
Psych Milt : “Because road planners have to look at a longer term than what petrol prices are doing this month. ”
Spot on.
Are road planners looking at the RB’s forecasts then?
From the Dom-post:
http://www.stuff.co.nz/dominionpost/4578022a6483.html
From frogblog:
http://tinyurl.com/43ckba
No-one is saying personal transport is on the way out. I’m saying the era of really cheap personal transport is over. People will still use cars, maybe not a hell of a lot less than now, but we don’t need to be adding capacity for that – we need more capcity for the people who won’t be able to afford to drive.
Only fools like Byran think the price of petrol is going back to $1 a litre.
electric cars etc – great, but you have to understand the amount of cheap energy that oil used to give us. Even a small internal combustion engine produces 100KW of power. Admittiedly most engines are only in use for an hour or so a day but, still, to replace those engines hundreds of thousands of times over with stationary electricity generation we would need billions of dollars of new capacity. No energy source is going to be as cheap as petrol was again (until we get fusion or something).
So the bribe is that they won’t buy up and demolish 600 houses when currently more houses are needed? eh? I accept that it might cost less to do so, but sounds like a raw deal overall.
What about private roads, that way those who aren’t big fans of private transport (such as yourself and many greenies I’d assume) don’t have to bear the cost of roads, while those who want them pay the full cost of the investment.
To all the unfailingly moronic right wingers here – no one is saying that the car is dead. But everyone who’s in the know is saying that oil and therefore petrol are going to become more expensive.
Essentially it’s a problem of supply an demand. The global economy keeps on growing at 4-5% per year, and while that growth looks set to slow, demand for oil will continue to outstrip supply – i.e. Economic growth in India and China will remain robust and less than one in 40 of their 2.4 billion inhabitants have their own automobile – and they all want one.
i.e.
http://money.cnn.com/2008/06/10/news/international/iea_forecast.ap/index.htm
Now, let’s have a look at the supply side. The task to keep up with demand is massive
No one is predicting that much extra capacity come 2015. Non-OPEC supply is set to peak in 2010, so it will have to come from the dictators of OPEC. Now, as a cartel you expect them to restrict supply and increase prices even if they have the spare capacity – but there’s no evidence that they do. So in any scenario the price of oil is set to keep increasing in the medium-term.
More public transport, and less waste on roads thanks!
Rather than re-argue every point with you here Roger I’ll just link to our last effort here
I reckon petrol will get close to 1 NZD per litre (+inflation and assuming govt does not raise petrol tax) again.
Oil futures speculation is what is driving the high price of oil.
George Soros reckons about $60 of the current price of a barrel of oil is accounted for by speculators. Others are estimating from $40 to $90 per barrel.
Even Obama just 2 days ago called for the Enron Loophole to be closed -> http://www.msnbc.msn.com/id/25318274/
Bryan:
I grew up in Mt Albert and I still do electorate work there.
You are daft if you think that the people in Mt Albert want this damn road. It won’t help us with our traffic, it will just help the rest of Auckland.
The best way of describing it at present is that the locals are getting resigned to it being built. That means the number of bodies doing an Arthur Dent will be less.
It will cause an major disruption across the whole upper part of the electorate. It is going to make a major mess of some parks that I’m fond of.
There is one motorway in Mt Albert already for the benefit of the westies. Personally I’d be in favour of dumping the damn thing elsewhere – but Auckland is a bloody isthmus. There are few routes and only one if you want to link to the north-western from the airport damnit.
In short you can take the insinuation and shove it up where the sun doesn’t shine SIDEWAYS. We have to put up with it – we don’t have to put up with someone being a fuckwit about it.
MikeE. I’d rather we do more productive things with our limited land in the major cities than cover it in unneeded roads.
Incidentally, I was going to just go with the headlights on the dark highway pic from Lost Highway for this, but then I found the pic above. I reckon it’s awesome, great lighting. The larger version is a beauty.
Just a thought starter, but let’s say that both roading projects are completed, which then allows cars/trucks to travel in and out of Auckland and Wellington at 70-100k per hour. How long would it take to recover the cost of the project through the fuel savings of all those cars/trucks on the road?
At the moment coming into Auckland from the North Shore can take anywhere up to 60-70 minutes and the whole journey is spent accelerating in first or second gear and the braking to a halt a few meters down the road. A really inefficient use of petrol.
But if all these cars can get from the North Shore to the city in 15-20 minutes going 70k in fourth gear then there is going to be a massive collective fuel saving as well as a reduced carbon footprint.
Just a deferent way of looking at the whole thing…
captcha: telephone koelble (not spooky, not relevant to post)
T-rex:
“Rather than re-argue every point with you here Roger I’ll just link to our last effort here”
Didn’t we conclude that local driving would continue with much more expensive fuel, utilising light-weight transport (commuting), while much long-distance freight will move on to rail – which all means less maintenance needed, and a lower roading budget. That’s why I now advocate decreased spending on roading and more on public transport – particularly.
djp:
The reason for the so called “oil bubble” is that the market is expecting oil to be more expensive in the future, so the futures market goes nuts, which has a knock on effect for current prices. The market has woken up to peak oil, and the real scarcity/value of oil is now being reflected in its price. Any questions?
darryl p, it might save money, but ironically the more people who make use of this fabulous new project, the less useful it gets because of congestion! So not much good I think.
Roger – I think I agreed with you on oil, but not on traffic or energy availability, but then agreed again on roads (you thought there would be fewer trips, I thought there might be just as many if not more but that utilisation would vastly improve).
Anyway, my comment above re: arguing with you was probably invalid.
Public transport not roads – for sure.
MikeE – I’m going to have a punt with that one. Why not? Perhaps the cost of transport has got to where it is no longer a public good, but more like the inner lanes of the Moscow Boulevards during the Cold War – private roads for the elite (politburo), but on public property.
Of course there are a few problems – how will we, the public, be recompensed for the land and infractructure costs that have been publicly funded to date?
If you’re talking about privatising all new roads (i.e. cease taxing petrol, and let developers build roads as the market wishes) then that is better, but private industry competing to build roads that would be privately owned doesn’t strike me as useful. How much duplication would you get, instead of having one single authority which contracts out building, for starters? How do you stop ‘free loaders’, people getting cheap petrol but avoiding private roads?
Given the inefficiency of private vehicles, I don’t mind that people who commute alone every day help to fund roads and rail, which public transport can take advantage of. Since the private car has caused so much damage to the global common, it’s all to sweet that the cost is being internalised. I think roads should be privately funded anyway, and the money raised from taxes go to CarbonZero transport initiatives. Not too feasible though…
darryl P – the problem is that it will encourage increased demand for roading, as the service is better. Greater road capacity will eventually result in a greater carbon footprint – but I know what you are getting at. I’m sure a balance can be struck that assists drivers, without excessively increasing demand – but a major project probably isn’t it.
Mike – I actually started to reply and then got distracted.
So long as you pay ALL the costs, including what would usually be externalities (noise pollution etc), and the road builder is prepared to accept all the risk (rather than get a govt guarantee in case of low use) then go for it.
Good luck selling THAT business model though!
T: You forgot something. They should purchase the land for the road at market rates (ie whatever the market will bear). I really don’t want state powers being used for the benefit of private enterprise.
It’d be interesting to see what the cost of the road would be after all of that.
The tunnel:
Transit have a problem with the design, the idea was to trench down beside Gt Nth Rd from Blockhouse Bay Rd to the motorway.
Then they figured out they would absolutely f*^k up a major artery to build well a major artery. The trenching would disrupt the traffic and the Waterview area so badly and put extra pressure on other suburban routes and basically gridlock west Auckland. It is a Hobsons choice going overland.
If anyone has driven that route in rush hour, and knows the geography (very important in decision) they will understand that a tunnel is the best option, it is not a bribe. It is the most expensive but least disruptive.
My bad analogy would be to block the harbor bridge to build another harbor bridge.
Good post. The Wellington Regional Council’s report talked about the “cannibalising” of passengers from the train system back into their cars if Transmission Gully was built. It had the dual adverse effects of persuading people to drive more and making the passenger transport system cost more because it would be used less. The best course is to fund the Wellington rail improvements and develop “clean” electricity supplies. There will then be a savings on the capital to construct, the annual cost to maintain and a reduced need to buy carbon credits.
Pretty simple really.
Auckland’s motorways have recently seen a reduction in useage for the first time ever. We really do need to think about the future and that the current rules are no longer going to apply.
Lynn asks:
infused: What grades are the oil you’re talking about?… From memory the Albertan oilsands are essentially tar. Great if you want to produce plastics, adequete for some types of heating oils, and absolutely useless for getting light fractions required for motor vehicles.
Australia’s 60 minutes had an item on this recently (link to video and transcript – ironically an ad for a car pops out of the same webpage!).
According to the transcript: “Now, to get the bitumen out you have to heat it up with lots of water at a very high temperature, then process it, refine it, and presto – synthetic crude oil”.