In April 2008, the Darebin City Council received a report on the implication for Council of Global Peak Oil that it had commissioned in July 2007. They resolved to continue the city's existing programs that enhance the city's resilience in the face of peak oil and add to them emphasis on the energy issue, to advocate to state and federal government about peak oil, and to refer the development of an action plan to budget considerations.
From minute 44, pages 44 - 52 of Darebin City Council Minutes of Monday, 18 Feb 2008 (Read PDF)
Council resolved at its meeting on 2 July 2007 that officers prepare a report on the implication for Council of Global Peak Oil. Peak Oil refers to the time at which global petrol production is reached and then begins to decline. The rising costs and fall in supplies will have implications for our community and Council operations including effects on transportation, planning, food security and purchasing petroleum based products including asphalt, plastics and pharmaceuticals.
This report summarises implications, existing programs and further strategic action recommended to respond to this important issue.
(1) Continue to implement existing programs outlined in this report and incorporate into these programs increased emphasis and communications around the implications of Peak Oil and the advantages of preparing now.
(2) Advocate to State and Federal Government regarding the urgency of the issue and the need for action including extended public transport services and priorities for essential services planning and provisions.
(3) Refer the preparation of a Peak Oil Scenario Planning / Risk Management Plan for Council Operations and Community Services and the development of a Peak Oil Strategy, including the setting of an Oil Depletion target, to 2008/2009 budget considerations.
(4) Consider further reports on an annual basis that review Peak Oil status and developments.
Council resolved at its meeting on 2 July 2007 that officers prepare a report on the implication for Council of Global Peak Oil.
What is Peak Oil?
Peak Oil refers to the time at which global petrol production is reached and then begins to decline. Oil will not run out at the time of peak production, however it will become increasingly expensive as it becomes more scarce.
Global demand for petrol continues to rise. Demand is driven by economic growth, affluence and lifestyles highly dependent on petroleum products in developed countries and increasing populations in poor nations and the increasing industrialisation of China and India. Until now increased production has matched this demand. Following Peak Oil this will no longer be the case - demand will continue to increase but supply will diminish. Prices for petrol and petroleum dependent products, including food, are expected to rise significantly. It is currently unlikely that replacement for fossil fuels such as hydrogen cells or solar power will become economically viable alternatives for some time in the future.
Relevance to Council
Peak Oil impacts will have implications for Council Operations, Services and the Darebin Community - these are summarised in this report and presented in more detail in Appendix A. A number of Council's existing policies and programs will make a positive contribution to addressing the impacts of Peak Oil. This report recommends continuing with current programs that address Peak Oil impacts and increasing communication with the community on this issue, advocacy for action from other levels of government and development of a risk management assessment and a Peak Oil Strategy.
When will Peak Oil Occur?
Petroleum products are a finite resource - it has taken millions of years for the Earth's ancient forests to be converted into fossil fuels that we are using up at a very rapid rate. No one disputes the fact that petroleum reserves will peak, decline and eventually run out at some stage although there has been a wide range of opinions as to when the peak will occur. There is however, growing consensus amongst scientists and geologists that Peak Oil will happen very soon.
A number of credible researchers and scientists believe that the peak in oil production has already happened or will occur within a few years.
Estimating the timing of Peak Oil is confounded by the lack of a consistent and transparent global reporting mechanism for available oil supplies. The available reserves information provided by many OPEC (Organisation of the Petroleum Exporting Countries) nations has not changed in years and is clearly inaccurate.
In general, global production lags behind and mirrors the discovery of petroleum. As indicated in the graph and table attached as Appendix B, global oil discoveries peaked in the 1960s and have been in decline since then. Most of the oil produced today was discovered before 1974 with estimates that for each barrel of oil that is currently being discovered, between 4 and 6 barrels of oil are consumed.
Impacts of Peak Oil
Our economy is highly dependent on fossil fuels. Our motorised transport relies on petroleum products (petrol, diesel and LPG) - and there are no readily available alternatives for replacement for our current transport demand levels. Compressed natural gas requires a substantial investment in refuelling infrastructure to be a viable alternative and if all of Australia's food growing land was converted to the production of biofuels it would still only address a small proportion of our transport needs. Electric vehicles are still expensive and have a limited range.
Many of our everyday products including plastics, pharmaceuticals and most fertilizers are produced from petroleum products. Modern agriculture is very dependent on fossil fuels for production and transportation - for food grown in Australia it is estimated that we use 100 kilojoules of fossil fuel energy to produce 10 kilojoules of food energy. And we transport food and many other products long distances increasing costs and dependency on fossil fuels. When petrol prices increase, food prices will also increase - placing additional pressure on disadvantaged members of the community. Peak Oil brings the risk of considerable social dislocation and recession.
Internationally a number of national, state or regional and local governments have developed strategies to address Peak Oil usually via 'Energy Depletion Protocols' that set targets to reduce use of petroleum products at the rate of depleting supply - estimated at ~3% a year. Sweden has made a broad commitment to move to an oil free economy by 2020.
In the United States of America a report commission by the US Department of Energy in February 2005 stated that:
"Viable mitigation options exist on both the supply and demand sides, but to have substantial impact, they must be initiated more than a decade in advance of peaking."
One of the most influential policies dealing with Peak Oil has been created by the City of Portland, Oregon in the United States. The City of Portland created a Peak Oil Taskforce with four subcommittees: Land Use and Transportation; Food and Agriculture; Public and Social Services (including education, health, social services, utilities and public safety); and Economic Change.
The Task Force released their report in March 2007. They made 11 recommendations:
- Reduce total oil and natural gas consumption by 50 percent over the next 25 years.
- Inform citizens about Peak Oil and foster community and community-based solutions.
- Engage business, government and community leaders to initiate planning and policy change.
- Support land use patterns that reduce transportation needs, promote walkability and provide easy access to services and transportation options.
- Design infrastructure to promote transportation options and facilitate efficient movement of freight, and prevent infrastructure investments that would not be prudent given fuel shortages and higher prices.
- Encourage energy-efficient and renewable transportation choices.
- Expand building energy-efficiency programs and incentives for all new and existing structures.
- Preserve farmland and expand local food production and processing.
- Identify and promote sustainable business opportunities.
- Redesign the safety net and protect vulnerable and marginalized populations.
- Prepare emergency plans for sudden and severe shortages
In Australia there are currently no Federal or State policies addressing Peak Oil. In February 2007, the Federal Government’s Senate Standing Committee on Rural and Regional Affairs and Transport
completed their inquiry into Australia’s Future Oil Supply and Alternative Transport Fuels. It concludes that the possibility of Peak Oil before 2030 should be a matter of concern and makes a number of recommendations including a reassessment of estimates of future oil supply and risks. Other recommendations include further investigation of:
- Alternative fuel sources
- Fuel efficiency of the Australia’s light vehicle fleet
- Congestion charges, and
- Fringe benefits taxes for employer-provided cars to address perverse incentives for more car use.
In Victoria, Ian McPhail the Commissioner for Environmental Sustainability recently presented a position paper on passenger transport and urbanisation entitled Creating a City That Works: Opportunities and Solutions for a More Sustainable Melbourne. In the paper, Mr McPhail highlights Peak Oil as one of the three critical challenges in shaping our urban development and transport systems. This is the first State Government document to officially recognise the seriousness of the implications of Peak Oil for Victoria.
There is some activity within Australian local governments.
In March 2007, Brisbane City Council’s Climate Change and Energy Taskforce released their final report A Call for Action. The report acknowledges the seriousness of Peak Oil production for the City and its community. It proposes a target of 50% reduction of oil use by 2026.
The report outlines a wide range of actions to address climate change and Peak Oil. The report is a first step towards engaging the community, setting reduction targets for oil use and emissions and developing and implementation program towards reducing the effects of climate change and Peak Oil within the municipality.
Marrickville Council in Sydney has recently agreed to adopt the Oil Depletion Protocol, reducing energy use within Council by 3% per year.
Maribyrnong City Council has released a draft Maribyrnong Peak Oil Policy and Action Plan for community consultation.
The Municipal Association Victoria (MAV) held a conference on Peak Oil and Climate Change in June 2007 and an informal MAV Peak Oil taskforce is now meeting. Phillip Knight from Darebin's Statutory Planning Unit is involved in this group.
Implications for Council and the Darebin Community
Peak Oil and the subsequent decrease in oil supplies are likely to impact on all aspects of council operations and to have lasting effects for our community.
The key areas of Council Services and Operations to be affected are:
- Petrol dependent services including waste collection, street cleansing, vehicle fleet, meals delivery and home care, road and footpath construction and maintenance, parks maintenance
- purchase of products especially those dependent on petro- chemicals including asphalt, wastebins and playground equipment (plastics), vaccines, herbicides and fertilizers
- employee transportation
- Council assets - changing use patterns
- Service demand and financial impacts - changing and increased demand for support services
Key impacts for the Darebin community
- transportation - costs, accessibility and changing needs
- food security - likely increased food costs and changes in availability
- health and safety - some positive benefits expected from transport and diet changes but also negative impacts via increasing costs of pharmaceuticals and access issues for medical services
- economic pressures and housing affordability, potential recession, employment changes and increasing demand for housing with access to public transport.
Expected impacts for council operations and the Darebin community are explored in more detail in Appendix A.
Current Darebin Initiatives
A number of current Council strategies and programs will make a positive contribution to addressing the impacts of Peak Oil particularly around reducing dependence on private car transport and promoting food security.
These programs also deliver a wide range of other community benefits including health and wellbeing, community building, reduced greenhouse emissions and air pollution, reduced traffic congestion and traffic accidents. The programs are summarised below:
Climate Change Action Plan - Through the Climate Change Action Plan 2007 Council has committed to achieving our 2010 greenhouse reduction target and having Carbon Neutral Council operations by 2020.
Electricity use, in buildings and street-lighting, is the major contributor to Council's greenhouse emissions - tackling emissions reductions in electricity will not have any impact on Peak Oil. Use of petrol, LPG and diesel in Council's vehicle fleet is responsible for around 12% of Council's total greenhouse emissions.
Actions identified in the Climate Change Action Plan that will also contribute to positive outcomes in terms of Peak Oil are measures to reduce emissions from the vehicle fleet, and staff and community Green Travel programs.
Council Fleet - Reducing usage and improving efficiencies are key priorities both for reducing greenhouse emissions and for preparing for Peak Oil. The Green Travel program (as per below) encourages reduced use of the vehicle fleet and staff commuting by private car. It is anticipated that the review of the Fleet currently being undertaken by Corporate Services will further identify actions to reduce use of petrol and related fuels (diesel and LPG) and greenhouse emissions.
Alternative fuel options including Biodiesel and Compressed Natural Gas have been reviewed under the Climate Change Action Plan. Neither are currently attractive alternatives in terms of climate action as the greenhouse reductions are debatable and/or marginal and there are other significant barriers including available infrastructure, cost and in the case of biodiesel land use and related social and environmental issues. It is possible that as Peak Oil pressures increase, these or other alternatives such as electric vehicles (powered by GreenPower) will become more viable.
Darebin’s Green Travel Plan (GTP) was developed and implemented in 2001. The GTP employs a number of activities and initiatives to encourage and facilitate Darebin staff to use sustainable transport both for the trip to and from work as well as for business trips. Elements of the GTP include a trip-logging incentive scheme, a rideshare database system, a bike fleet, facilities including showers, lockers and bike parking, promotions and events, interest free loans for Metcards and bicycles, and Metcards for meetings.
Darebin Transport Strategy - One of the main aims of the Darebin Transport Strategy is to reduce dependence on private car transport. The strategy identifies Peak Oil as one of the drivers behind the need to reduce reliance on private vehicles for transport needs. The strategy will also aim to build in information about Peak Oil as one of the reasons (along with health and safety, environmental issues and costs etc) for using sustainable transport options.
Darebin is implementing a range of innovative travel programs for the community. Key transport initiatives are listed below.
Love Living Local - The City of Darebin received funding from the Victorian Government, under the TravelSmart Local Government Grants Program, to conduct ‘Love Living Local’. Love Living Local is a travel behaviour change program that encourages people to reduce their car use by helping them discover how many services are on offer in their ‘own backyard’.
By keeping activities close to home, people are more likely to walk, cycle or catch a tram or bus to get around. This can reduce car use, which is beneficial for the environment, health and enables people to meet neighbours and join in with their community.
The program will work successively in three areas of Darebin, beginning with Preston. Darebin is working with community organisations, shopping centres, schools, residents, traders and local services to deliver a range of initiatives to encourage people to shop and recreate locally. It also helps strengthen local business and activity centres.
School Travel Planning - After successfully working with Preston South and Wales St primary schools in 2005/2006, Darebin is currently working with Northcote Primary School, St Josephs Primary School, Holy Name Primary School, Preston Girls Secondary School, Samaritan Catholic College, Preston West Public School, Sacred Heart Primary School, Reservoir Secondary District College, and Kingsbury Primary School to develop travel plans with the school community. This involves investigating barriers to walking, cycling, use of public transport and carpooling, and to implement initiatives and actions to redress the balance. Each participating school is supported by $10,000 funding - this has typically been used to install a bicycle shelter (which is not traditionally funded by the Department of Education) and run events for students, parents and staff.
Going Places – Darebin’s Travel Reward Scheme - is a web-based program which rewards people for making two less drive alone trips each week. Entering its second year, the program is being extended to include employees of Darebin based businesses. This aspect of the program will encourage employees to travel sustainably for the journey to and from work.
Rewards for participants include pedometers, Metcards, bike lights, movie vouchers, shopping vouchers and personal benefits such as increased health and fitness (if walking or cycling) and less stress associated with driving. Members events are also held a number of times a year, and the program partners with local businesses by providing discounts to Going Places members.
New Development Travel Planning - When particular planning application criteria are met, developers are required to produce a travel plan to reduce single occupancy car travel that will be generated by that development.
Darebin and Banyule Good Food Alliance focuses on programs to increase food security, primarily in the East Reservoir (and West Heidelberg) Neighbourhood Renewal areas. The Good Food Alliance
- Support people in making healthy lifestyle choices
- Improve access to local healthy foods
- Provide information on fresh foods and nutrition
The Alliance is implementing a Food Security Strategy. Current activities include: Supporting schools involvement in healthy eating initiatives; Looking into food co-operatives as a way to buy fresh fruit and vegetables; and Research into: current costs for a healthy food basket, locations and accessibility of emergency relief, transport barriers to shopping, and family healthy eating habits.
Local Food Production and Community Gardens - there are currently seven community gardens in Darebin and they all have waiting lists. Demand for community gardens and other solutions for growing food locally on public and private land will continue to increase. The East Reservoir Neighbourhood Renewal Project has recently received $48,000 funding from the Victorian Government for a community garden in the East Reservoir area. Consultation and scoping of potential sites is underway. The community gardens network is currently supported by Health and Community Services.
Structure Planning - the consolidation of urban development around service centres and good public transport options will help prepare for Peak Oil.
Environmental seminars and workshops - Environmental Strategy currently runs seminars and provides materials and incentives to assist home gardeners and promote sustainable transport. These include the 'Spring into Compost program' which makes available compost bins and worm farms at reduced prices. The Sustainable Homes program includes a Sustainable Gardening workshop and a Sustainable Transport workshop. The Spring into Compost program includes a series of workshops on how to compost effectively, the session 'Growing Food Sustainably' is one of the most popular in the series with more than 70 people attending in 2007. The Sustainable Gardening in Darebin booklet currently includes a small section on growing food.
EcoBuy Program and the Environmental Purchasing Code encourages Council staff to select environmentally preferable products including those with recycled content and energy saving products.
Options for Council Action on Peak Oil.
As indicated above a number of Council programs already underway will assist our community in preparing for and transitioning into a post Peak Oil society. These initiatives have a broad range of other benefits including health, safety and well-being, community building and reducing greenhouse emissions.
The level of action required to make this transition as painless as possible however is very large and requires concerted action, planning and support from the Federal and State Governments. Community awareness about the issue is still very low. In terms of its status and priority as an issue for governments Peak Oil is in a similar position to Climate Change five or so years ago. The potential magnitude of the problem and our massive dependence on fossil fuels seems to encourage a culture of denial.
It is recommended that advocacy to State and Federal Governments to take action on this issue be a priority for Darebin Council along with clear and responsible communications with our community.
Two levels of response from Council are outlined below:
Low Level Response - within current budget
- Continue to implement programs outlined above and incorporate into these programs increased emphasis and communications around the threat of Peak Oil and the advantages of preparing now.
- Advocate to State and Federal Government re the urgency of the issue; the need for action including extended public transport services; priorities for essential services planning and provisions (including waste services, meals on wheels etc; likely impacts for local government services etc).
- Further investigate and mitigate direct cost impacts to Council operations.
- Annual Review and Report to Council re Peak Oil status and developments.
Higher Level Response (~$60,000 - 2008/2009)
- Continue to implement programs outlined above and incorporate into these programs increased emphasis and communications around the threat of Peak Oil and the advantages of preparing now.
- Advocate to State and Federal Government regarding the urgency of the issue, the need for action including extended public transport services, priorities for essential services planning and provisions (including waste services, meals on wheels etc likely impacts for local government services etc).
- Conduct a Peak Oil Scenario Planning / Risk Management Plan for Council Operations and Community Services (estimated cost $30,000).
- Following the risk assessment scope and develop a Peak Oil strategy including the setting of an Oil Depletion target and commit to reducing Council's petroleum use by 3% per year and/or set a 2020 or 2025 reduction target. The strategy would also scope gaps and opportunities, and identify additional actions for supporting the Darebin community to transition to Peak Oil (estimated cost $20,000).
- Annual Review and Report to Council regarding Peak Oil status and developments.
It is recommended that Council adopt the higher level response due to the critical implications of Peak Oil on Council Operations and the community.
The recommended actions are estimated to cost a total of $60,000 and include:
- A Peak Oil Scenario Planning / Risk Management Plan for Council Operations and Community Services (estimated cost $30,000);
- Development of a Peak Oil Strategy (estimated cost $20,000); and
- Communication and promotions (estimated cost $10,000).
These items will be referred to the 2008/2009 Budget for consideration.