Here's an article (World running out of time for oil alternatives) that has it all...rising prices, transition to alternatives, lower prices on alternatives, conservation of existing stocks, panic...looks like the economic models hold some predictive power (except for that panic part).
What do teh simple economics models of depletable oil stocks predict (CAPS below)?
INCREASING OIL PRICES creates the incentive to invest in transitional technologies...
"The high oil price makes people at least think about alternatives ... "
PRICES OF ALTERNATIVES FALL with investment...
"In 10-15 years, I expect that solar energy conversion could be in competition with electricity produced from coal," Hoff said.
CONSERVATION OF EXISTING STOCKS will ease the transition...
"That's why we need to use fossil fuels in a more efficient way to have some more time to develop these alternatives up to a level where the robustness is guaranteed and their price has come down ..."
PANIC (ok, not in the economic models)...
The world could run out of time to develop cleaner alternatives to oil and other fossil fuels before depletion drives prices through the roof...
Hmmmm...let's hope the economic models haven't missed that last part. I don't think they have, but it still gives pause every time I see it.
