Editor's note: the following post is by Dr. Charles Hall and his Phd student David Murphy (EROI Guy), and is part of our on-going series reviewing the World Energy Outlook 2008, recently published by the IEA. It is also the first post of a new 'channel' on The Oil Drum: TOD:EROI, where we will be posting essays, papers, and analysis on the biophysical aspects of energy. Our intent is to be a real time central clearinghouse for biophysical/net energy research and ideas. We have debated on calling it EROEI - Energy Return on Energy Invested, but have decided to keep it consistent with the acronym from the energy literature. The post below critiques the neoclassical economic assumptions underpinning the IEA report and proposes future 'energy watchdog' reports utilize an alternative approach grounded in biophysical concepts.

Today, the world's energy 'watchdog', the International Energy Agency (IEA) published their long awaited annual World Energy Outlook (WEO) for 2008. In stark contrast to bland-to-cornucopian supply commentary in past reports, the initial language in this years Executive Summary is of an urgent nature. This report is a step in the right direction for conveying our rapidly deteriorating energy situation to world policymakers - the IEA should be commended for making the turn and finally acknowledging: costs, investment limitations, new capacity requirements, steep decline rates of existing wells, and externalities (in this case GHGs). In effect, this report shatters the global illusion that oil resources magically turn into cheap flow rates. However, at first glance, the report's details do not support the urgent tone of the beginning paragraphs. Beginning tomorrow, The Oil Drum staff will be running an ongoing daily 'analysis/review' of the new IEA outlook. Below the fold is an overview/introduction to this series.

World Oil Production in IEA's Reference Scenario (IEA WEO 2008 Slide 8) Source (pdf)