Very few Americans realize just how bad the domestic energy situation will become in the next several years. While shale oil production has surged over the past few years, giving Americans a false sense of energy security, the next five years will permanently destroy that myth.

The decline and death of the Great Bakken shale oil formations has begun and very few Americans understand its significance. Just a few years ago, the United States energy industry and mainstream media were gloating that America was on its way to “Energy Independence” and to resurrection of the “Energy Fiesta.” About half the oil currently consumed in the U.S. is imported.

The Bakken shale formation is one of the largest contiguous deposits of oil and natural gas in the U.S. and Canada underlying large areas of eastern Montana and western North Dakota, as well as parts of Saskatchewan and Manitoba, Canada.

Unfortunately, most Americans believe the independence hype, and they are now back to their wasteful ways of driving big SUVs and trucks having lousy fuel mileage. The industry has fostered the wide belief that technological improvements will continue the increased production from massive shale oil reserves at a fraction of conventional drilling costs.

According to the most recent Drilling Productivity Report published by the U.S. Department of Energy, the Bakken formation is now down a stunning 25 percent from its peak in a little more than a year and half. Its production peaked at 1.26 million barrels per day in January 2015, and was at 942,000 barrels per day in July 2016. Bakken will be producing a lot less oil by 2020 and very little by 2025.

The world is fast approaching the point where global oil production peaks, then steadily declines. As a prime example, U.S. production — the world’s third-largest oil producer — stopped growing more than a decade ago and has flatlined or steadily fallen ever since.

Economic growth myth

Economics is the study of humanity transforming nature to satisfy its needs and wants. Traditional economic theory does not consider natural resources as investment capital, only labor and money. In reality, wealth derives from employing work energy to transform raw materials into physical objects, which inescapably subjects the transformation to the laws of physics, culminating in the eventual decline and disintegration of the product.

For the past 150 years, economics — a social science — has been modeled as a circular flow of products between producers and consumers. In this interaction between producers and household consumers, little to no accounting was given to the flow of energy and raw materials from and to the environment. Accordingly, the model assumes energy and matter as completely recycled in these transactions, and economic activity is seemingly exempt from the Second Law of Thermodynamics — in any conversion of energy from one form to another, a percentage of available energy to do work is lost forever.

Universally, growth has historically been considered positive, necessary, and inevitable. But growth is a stupid economic goal because it necessitates increased demand for diminishing natural resources to service prior debt. Eternal growth is the Holy Grail of economics. Constant economic growth ignores the world’s diminishing supply of fossil fuels and raw materials at humanity’s peril.

It’s all about energy

A relatively new science-based theory known as Biophysical Economics has emerged placing energy at the heart of economics and not supply-demand curves. It employs the principle of net “Energy Return on Energy Invested.” Its fundamental principle derives from scientific knowledge that the survival of all living creatures is limited by EROEI; this means that any living thing or society can survive only so long as they are capable of getting more energy from any activity than expended. For instance, if a squirrel burns energy collecting and eating nuts, those nuts had better provide the squirrel more energy then it expended or the squirrel will inevitably die. Human societies are, likewise, governed by EROEI.

Analysis of historical U.S. production data concluded that the petroleum sector’s EROEI was about 100-to-1 in 1930, which meant that extracting 100 barrels required burning approximately 1 barrel worth of oil’s energy. By the 1990s, that number slid to less than 36-to-1, and further down to 19-to-1 by 2006.

Despite technological advances, companies and governments must expend increasingly more energy to get less and less oil than previously produced. At some point the return on energy investment will go so low as to guarantee economic collapse because it leaves nothing for other economic activity.

The only plausible solution — anathema to current corporate and governmental policy and practice — is for most nations to supplant economic growth with economic contraction, meaning negative population growth and significant reductions in per capita consumption and waste. Good luck with that!

Yet without such change, the future is bleak.

Robert Fromer is an environmental consultant residing in Windsor. A former New London resident, he is an occasional contributor to The Day opinion pages.