The energy crisis that we find ourselves in has been slowly building since the 1970s. The economy is essentially a thermodynamic machine. Everything that humans call wealth, is the production of surplus energy used to rework matter. If you plot global GDP against global energy production, you get a virtually straight correlation between the two. The world has developed high living standards only through the intensive use of energy.
Gradually, over a period of several decades, the energy cost of producing energy has been rising. Between the late 70s and late 90s, we replaced US land based conventional light sweet crude, with North Sea oil, Alaskan oil, GOM, Arctic oil. This solved the oil shortage problems of the 1970s, but it did so at a higher price and poorer 'Energy Return on Energy Investment'. This allowed Western economies to grow again, but at a lower rate than they had up until the mid 1970s. Inequality between rich and poor grew during this period, as rising production costs restrained wages. By the late 90s, global oil production from conventional sources could no longer grow. Manufacturing industry shifted from the OECD to China. Officially, this was all about exploiting Chinese Labour. But it was also driven by the allure of low cost Chinese coal based energy. This was exploited using cheap and often forced labour and provided some of the cheapest electricity in the world. Rising oil demand from China and stagnant global production, set the scene for high inflation leading up to 2008. This was driven by rising oil prices. This inflation and central banks reaction to it (rising interest rates) was the direct cause of the financial crisis.
Since 2008, interest rates have been held close to zero and central banks everywhere have flooded economies with fiat currency. The idea is to stimulate economic growth. Politicians and economists tend to view the economy as a financial system, in which the only relevant input for growth is money supply. It hasn't worked because economies are in reality physical systems in which people make goods and services and exchange them. They run on surplus energy. Money is just the medium of exchange. What monetary inflation has achieved is to push the stock market to absurd heights, completely disconnecting company valuations from any realistic future earnings estimate. It has also depressed bond yields to very low levels. This directly enabled the US tight oil and Canadian syncrude revolutions, which have been responsible for all growth in global oil production since 2008. The inherently poor EROIE of shale and syncrude has led to an industry that has spent billions of dollars, producing millions of dollars of oil. So long as interest rates and bond yields remain beneath inflation, these zombie companies can keep running. They can borrow almost unlimited amounts of money, confident that inflation will erode the value of debt without ever having to repay it. But nothing can defeat the declining energetics of fossil fuel production. In real terms, the average American and European has been getting poorer since the early 2000s.
In November 2018, global oil production hit what looks increasingly likely to be an all time peak. This was driven the declines in OPEC production. Spare capacity in Saudi Arabia and UAE, could no longer compensate for the decline rate of all other OPEC producers. US oil production now faces bottlenecks that are hampering its recovery. However, the Permian is the only shale basin with growth potential. Increasingly, growth in the Permian must offset declines in other shale basins. All other producing regions in the world are either close to peak (Saudi and UAE) or past it (Europe, Russia, China, East Asia, etc).
The oil crisis is occurring at the same time as an apparent peak in Chinese coal production. This is placing cost pressures on just about everything that is being made in China. The recent antagonism between Russia and the Western world, has aggrevated global energy supply shortfalls. Energy intensive products like fertiliser and diesel, could have been manufactured in greater volumes elsewhere in more abundant times. Now that is all but impossible, as there are no abundant low cost oil and and gas resources whose production can be increased quickly enough and cheaply enough to make up for loss of Russian supply.
Renewable energy is often touted as something that can be used to substitute for fossil fuels. This is looking increasingly unlikely as the world heads into a situation where fossil fuels are in short supply. Renewable energy sources are low in power density. Each unit of energy produced by a Wind farm or solar farm, depends upon a much greater mass input of industrial materials than legacy fossil or nuclear energy systems. Producing them at low cost depends upon well functioning global supply chains and abundant fossil fuels like coal and natural gas, needed to produce the gigatonnes of steel, concrete, glass, copper and polysilicon needed for these things to be built at scale. The recent competitive costs of wind and solar projects are an artifact of cheap Chinese coal, low interest rate money at both manufacturing and customer ends, abundant diesel needed to maintain supply chains and above all huge economies of scale. As the world enters the depletion phase of fossil fuels, all of these supporting factors are going into reverse. Supply chains are disintegrating, along with the diesel supplies that sustain them. Cheap coal is a thing of the past, even in China. Political antagonism is rising between states. The capital costs of large renewable energy projects are now rising at rates far above official inflation. Renewable energy systems also tend to reduce fuel consumption in legacy fossil power stations. They do not replace them. They also impose additional requirements, such as grid strengthening and battery banks for frequency control. These facts, taken together and contrary to popular hype, make it extremely unlikely that renewable energy sources can provide more than a niche solution to our civilisation ending problem of declining surplus energy.
It is in this environment that we must rapidly find a nuclear energy solution capable of producing the high EROEI surplus energy that fossil fuels are no longer capable of providing. It would be helpful if this were applicable to transportation as well as electricity supply. This solution may be fission, fusion, LENR, all three, or maybe some hybrid solution involving all of them. In some respects this is good news for LENR and fusion. Never has a breakthrough in these areas been more desperately needed. The bad news is that as surplus energy declines, long-term R&D projects are likely to be scaled back. Which is why the solutions that might help are things that we can develop quickly and easily and relatively cheaply. My own thoughts are that the institutional barriers that stand in the way of nuclear fission need to be removed in a hurry. But LWRs would quickly run into uranium fuel shortages. Fusion has made impressive progress, but is not yet in a position to provide stand alone power plants. It is doubtful in fact that magnetic confinement fusion could ever develop the power density needed to build an economicically competitive power plant, especially when embodied energy is accounted for.
What Fusion has succeeded in doing is provided a compact source of high energy neutrons, but has thus far fallen short of breakeven. This could be especially valuable if we can develop designs that combine Fusion and fission in a single reactor. Each of those 14.1MeV neutrons, could ultimately produce several fission events. Fast fission from a 14.1MeV neutron will release an average of 4.2 neutrons. In a fast reactor, at least one of those secondary fission neutrons would produce fast-fission of 238U, which would yield three additional neutrons. What this neutron rich environment allows us to do, is build fast reactors that can function as travelling wave reactors. Essentially, these reactors can be fuelled with depleted uranium, breeding all of the fuel it needs as it shuffles through the core. There is no need for chemical reprocessing and the TWR converts a large proportion of total uranium energy into heat. Without fusion neutrons, a fast reactor would need to achieve a burn up of 300GW-days per tonne to achieve this. It isn't practical with existing cladding materials. The addition of a fusion neutron source could allow a TWR to function at lower discharge burn ups. This makes it a near term solution, that is cheap and compact enough to build anywhere, using modular construction techniques. Lattice confinement Fusion is in my opinion the key technological advance allowing this, because it uses the fission reactors own gamma and neutron flux to produce Fusion, thus amplifying neutron flux and dramatically hardening the neutron spectrum. The reaction itself never needs to reach breakeven.