Energy return on investment

Based on Wikipedia: Energy return on investment

Here's a question that might explain why your electricity bill keeps climbing, why gasoline prices seem permanently elevated, and perhaps even why the Roman Empire fell: how much energy does it take to get energy?

This deceptively simple question sits at the heart of everything from your morning commute to the rise and fall of civilizations. The answer is measured by something called Energy Return on Investment, or EROI—a ratio that may be the most important number you've never heard of.

The Basic Math That Runs the World

Think of EROI like this: if you need to burn one barrel of oil to extract and refine ten barrels from the ground, your EROI is 10:1. You put in one unit of energy, you get ten units back. Simple enough.

But here's where it gets interesting.

When EROI drops to 1:1, you've hit a wall. You're burning a barrel of oil just to get a barrel of oil. At that point, you're not harvesting energy anymore—you're running on a treadmill. The energy source becomes what researchers call a "net energy sink," which is a polite way of saying it's useless as fuel.

And it gets worse. Researchers have determined that an EROI of at least 3:1 is the minimum threshold for a fuel source to be considered viable. Why three, not two? Because energy doesn't just power cars and factories. It has to support the entire infrastructure of civilization—hospitals, schools, roads, water treatment plants, everything. Below that 3:1 threshold, there simply isn't enough surplus energy left over to maintain complex society.

The Golden Age We Didn't Know We Were Living In

When oil was first discovered in Pennsylvania in the 1850s, the EROI was astronomical. It took about one barrel of oil-equivalent energy to extract roughly 100 barrels of crude. Some estimates for early discoveries run even higher.

Let that sink in for a moment. For every unit of effort, you got back a hundred units of energy. This wasn't just good fortune—it was the foundation of the entire industrial revolution and everything that followed. Cheap, abundant energy with minimal extraction costs built the modern world.

But those days are gone.

The EROI for discovering fossil fuels in the United States has plummeted from around 1000:1 in 1919 to just 5:1 in the 2010s. We went from energy bonanza to energy struggle in a single century. The easy oil—sitting in shallow pools, practically gushing from the ground—was found first. What remains requires drilling miles deep, extracting from tar sands, or fracking through layers of shale rock.

A Tour of the Energy Landscape

Not all energy sources are created equal, and their EROIs reveal fascinating differences.

Hydroelectric power is the undisputed champion. A well-built dam can achieve an EROI of around 110 when operated for a century. Think about that—for every unit of energy invested in concrete, turbines, and construction, you get back 110 units over the dam's lifetime. This explains why countries with abundant hydropower, like Norway and Iceland, enjoy some of the cheapest electricity on Earth.

Wind turbines have improved dramatically. Modern designs like the Vestas V150 report an EROI of 31, though the average across operational turbines sits around 19.8. The variation depends heavily on location—a turbine in the gusty North Sea outperforms one in a calm valley. There's a catch, though: when you add battery storage to smooth out wind's intermittent nature, the EROI drops to around 4. The batteries themselves require substantial energy to manufacture.

Conventional oil still performs reasonably well, with refined fuel showing an EROI between 18 and 43 depending on the geology of the field. But this represents what's left of the "easy" oil. Newer, harder-to-reach reserves don't match these numbers.

Nuclear power ranges from 20 to 81, a wide spread that reflects ongoing debates about how to count various inputs. Should you include the energy to mine and enrich uranium? What about decommissioning the plant decades later? Different researchers draw the boundary lines differently.

Solar photovoltaic panels present the messiest picture of all. Estimates have ranged wildly from 8.7 to 34.2, depending on methodology, location, and technology type. The good news: a 2021 study by Germany's Fraunhofer Institute found that modern silicon panels in Europe pay back their embodied energy in about one year. Install a panel in sunny southern Italy, and within twelve months, it has generated more energy than was used to manufacture it.

Oil shale sits near the bottom of the barrel, metaphorically and literally. With an EROI of only 1.4 to 1.5, it barely clears the break-even point. This explains why oil shale only becomes economically interesting when natural gas for heating is essentially free on-site—and even then, critics argue that gas would be better used directly as transportation fuel.

The Deeper You Dig, the Messier It Gets

Here's where EROI calculations become genuinely contentious: how far back in the supply chain should you count?

If you're building a wind turbine, obviously you count the energy to manufacture the turbine itself. But what about the steel? Should you include the energy used to make the steel? What about the factory that made that steel—do you amortize the construction energy of the building? The roads that delivered materials to the factory? The food that fed the steelworkers who built those roads?

You can see how this spirals toward absurdity. Draw the boundary too narrowly, and you're ignoring real energy inputs. Draw it too broadly, and you're attempting to account for the entire economy.

Charles Hall, the systems ecologist who pioneered EROI analysis, developed what he calls an "extended" methodology. By his calculations, an EROI of at least 5 is needed for basic sustainability, while 12 to 13 is required to support technological progress and what he poetically calls "a society supporting high art."

Think about that distinction. At EROI of 5, you can keep the lights on and food on the table. At 12 or 13, you have enough surplus energy for universities, symphonies, and space programs. Below 5? Things start breaking down.

When Rome Ran Out of Energy

This brings us to one of EROI's most provocative applications: explaining why empires collapse.

Historian Thomas Homer-Dixon has argued that declining EROI contributed to the fall of Rome. The logic runs like this: at its height, the Roman Empire fed 60 million people on an agrarian base with an EROI of about 12:1 for wheat and 27:1 for alfalfa. The math worked. Every farmer produced enough surplus food to feed soldiers, bureaucrats, artists, and philosophers.

But ecological damage accumulated. Deforestation stripped hillsides across Spain, Italy, Sicily, and especially North Africa. Soil fertility declined. The EROI of Roman agriculture began to fall, slowly at first, then faster.

By the second century, the system was straining. By the fifth century, the Western Empire collapsed. Rome's population, which had peaked at 1.5 million under the Emperor Trajan, bottomed out at just 15,000 in 1084.

Fifteen thousand people living in the ruins of a city built for a million and a half.

Similar patterns appear in the collapse of the Maya civilization and the Khmer Empire of Cambodia. Complex societies require energy surplus. When that surplus shrinks—whether from deforestation, soil exhaustion, or depleted oil fields—complexity becomes unaffordable.

The Trajectory We're On

The numbers for our current situation are sobering.

Researchers estimate that the weighted average EROI for all liquid fuels—including conventional oil, tar sands, coal-to-liquids, and biofuels—has been declining steadily. From about 44:1 in 1950, it's projected to fall to just 6.7:1 by 2050.

Natural gas tells a similar story, dropping from a remarkable 141:1 in 1950 to an expected plateau of around 17:1 by mid-century.

These aren't catastrophic numbers yet. An EROI of 7 or 17 still represents net energy gain. But the trend line points in only one direction: down. Each year, we expend more energy to get less back. The era of cheap, easy energy is behind us.

Storage Changes Everything—And Not for the Better

There's a related metric worth understanding: ESOEI, or Energy Stored on Energy Invested. This measures how much energy you can store over a device's lifetime versus how much embodied energy went into building it.

Why does this matter? Because renewable sources like wind and solar are intermittent. The sun doesn't shine at night. The wind doesn't blow on demand. To make these sources reliable, you need storage—batteries, pumped hydro, or other solutions.

A Stanford University analysis found troubling results. Without access to pumped hydro storage (which requires specific geography—mountains and water), the combination of wind energy and current battery technology may not be worth the investment. The energy cost of manufacturing enough batteries to smooth out wind's variability drags down the overall system EROI substantially.

This doesn't mean renewables are doomed. It means the transition is harder than simple cost comparisons suggest. The easy path—just swap solar panels for coal plants—runs into physical constraints that accountants' spreadsheets don't capture.

The Quality of Energy Matters Too

EROI has another wrinkle that complicates analysis: not all energy is equivalent.

A joule of electricity is more useful than a joule of low-temperature heat because electricity has lower entropy. It can be converted more efficiently into motion, light, or computation. A joule of liquid fuel is more useful than a joule of coal because liquids are easier to transport and store.

This means an EROI comparison between, say, coal-fired electricity and gasoline from petroleum isn't quite apples-to-apples. You might deliberately accept an EROI below 1:1 for producing ethanol from coal if the result is liquid fuel that can power vehicles. The "loss" in the conversion might be worth the gain in utility.

Researchers struggle with how to account for these quality differences. Some adjust for it; others don't. This is part of why EROI estimates vary so widely even for the same energy source.

A Concept Worth Knowing

There's something clarifying about EROI as a lens for viewing the world. It cuts through the noise of energy debates—the subsidies, the politics, the competing claims—and asks a fundamental physical question: does this actually yield more energy than it consumes?

The concept connects the price you pay at the pump to the fall of ancient empires. It explains why we drilled the easy oil first and now resort to elaborate techniques to extract what remains. It illuminates why the transition to renewable energy, however necessary, will be harder than optimists suggest.

And it poses an uncomfortable question about our civilization's trajectory. For three centuries, we've enjoyed rising EROI from fossil fuels, building ever-more-complex societies on the surplus. That era is ending. The fuels we've come to depend on yield less energy return every decade.

Whether we transition gracefully to alternatives or follow Rome into decline may depend on a ratio that most people have never heard of. Energy Return on Investment isn't just an abstract concept for academics to argue about.

It might be the most important number in the world.