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Media Release

15/08/2005

"Backwards" public transport system failing to ease oil price pain

Public transport users have welcomed Steve Bracks' admission that Melbourne's public transport system is going backwards, but have called on the government to get serious about the urgent job of fixing it.

"The government's recognition of the poor health of public transport is an important first step," said Public Transport Users Association President Daniel Bowen. "The key test of whether this is a do-nothing government is the steps they now take to make fast, frequent and reliable services available to all Melburnians."

Mr Bowen also highlighted the need to fill the gaps in the public transport network to ensure it meets modern travel needs. "We shouldn't forget that over half the city's residents don't have ready access to the rail network, especially in some of Melbourne's key growth areas," said Mr Bowen. "Residents of these areas are often struggling to pay a mortgage, bring up kids, and now pay over $1.20 for a litre of petrol. Mr Bracks must commit to extending the rail network to Rowville, South Morang and Doncaster and rolling out the SmartBus program right across the city so that families are rescued from ever-escalating fuel prices," urged Mr Bowen.

While many industry commentators believe record oil prices mainly reflect a lack of refinery capacity, an increasing number of observers are lining up behind the view that oil production will peak in the next 10 years, possibly sooner (see table 1). Although "peak oil" will not mean the complete end of oil production, it does mark the point at which production growth will cease and then begin a relentless slide downwards.

A recent report(1) commissioned by the US Department of Energy found that oil depletion "deserves immediate, serious attention" and will result in "dramatically higher oil prices" causing "protracted economic hardship". Mr Bowen warned that time is running out to prepare our transport system for ongoing oil shortages. "Although petrol prices may moderate if current supply bottlenecks ease, the simple fact is that oil is running out and it might not be long before we think $1.24 per litre was a bargain. Since it will take time to put rail extensions and bus service improvements in place, the government must start now so that we cushion ourselves from the inevitable impact of oil depletion."

Mr Bowen also cautioned against reliance on so-called "alternative fuels" such as ethanol(2). "There is no quick fix to oil depletion. Many alternatives such as tar and shale oils come at huge financial and environmental cost, whilst ethanol production and distribution often requires more energy than is extracted from the final fuel." Mr Bowen concluded, "public transport is the most efficient, and ultimately the cheapest means of keeping people mobile in our cities."

Table 1: Projections of when global oil production will peak

2006-07Ali Samsam Bakhtiari - Iranian oil executive
2007-09Matthew Simmons - US energy investment banker
Post-2007Chris Skrebowski - Petroleum journal editor
Pre-2009Kenneth Deffeyes - Oil geologist
Pre-2010David Goodstein - Vice Provost, Caltech
Circa-2010Colin Campbell - Oil geologist
Post-2010World Energy Council - International energy organisation
2010-20Jean Laherrere - Oil geologist
2015Volvo - Automotive company

Footnotes:

(1) Peaking of world oil production: Impacts, mitigation, & risk management, by Robert L. Hirsch, Roger Bezdek & Robert Wendling, February 2005

(2) See http://www.ptua.org.au/myths/fuels.shtml

Contacts:
PTUA Office 9650 7898


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Last Modified: 15 August 2005