Economy and Media & Marketing

City should prepare for energy shortage:

March 14, 2005

Indianapolis city planners should begin planning for a declining energy future. "Peak oil" and natural gas (generally, the point at which worldwide production begins to decrease, and the resource subsequently depletes)-are well-documented and loom directly ahead. Yet local plans are silent on the subject. Long-term impacts on our economy and community fabric will be significant. Mobility and development patterns will be heavily affected. Politicians and the media need to inform the public and properly plan for this sobering eventuality.

The administration of Mayor Peterson heavily promotes regional growth, which depends, in large part, on unlimited and relatively cheap energy. Yet the petroleum market is in the initial stages of a sea change. We have recently seen major price movements. Cheap oil and gas are a thing of the past.

The convention trade sector could be a bubble about to burst. A recent Brookings Institution report counters the rationale of local officials who insist on the need for expansion of the convention center.

The Brookings report cites declining demand in the convention sector due to three broad trends-industry consolidations, reductions in business travel, and the emergence of alternative means of information. In "The Party's Over-Oil, War, and the Fate of Industrial Societies," Richard Heinberg opines that "Commercial air travel may soon be a thing of the past, as jet fuel becomes more scarce and costly." Indianapolis officials contend we are not significantly affected by these industry trends.

We've committed to expanding the airport. Will the advent of peak oil render this expansion obsolete even before the midfield terminal is completed?

The city insists that a major expansion of the convention center is essential to central Indiana's future prosperity. Yet no one has projected the potential impacts of even more reduced business travel on the convention trade. Peak oil will further depress business and convention travel, probably significantly.

Forward-looking businesses plan strategically. Indianapolis should do likewise to plan for peak oil. As a current case in point, policymakers and the public should critically review the rationale for the proposed convention center expansion before committing the substantial resources to build what might quickly become a white elephant.
Source: XMLAr01401.xml
ADVERTISEMENT
Comments powered by Disqus