It is becoming fashionable to talk about “the undulating plateau”. This refers to the possibility that, rather than a catastrophic collapse, society will ease down from peak energy in a series of falls and recoveries. In its initial stages, each recovery will balance its preceding fall, leading to an “undulating plateau”.
The idea, along with “peak demand”, is politically attractive and for the same reason. It allows governments and other interested parties to begin to think about peak energy, without getting overwhelmed by having to think about the implications of the financial, commercial, social and cultural failure it entails.
To that extent, it is a useful device. But it is about as optimistic a forecast as the facts appear to be able to support.
Complex things have a habit of working until they don’t, then not working at all. Think about a 4-stroke engine after the “oil pressure” light comes on—the health of its tappets is irrelevant.
There isn’t anything more complex than “the economy”. Bits of it might be capable of functioning continuously under conditions of declining energy input (domestic energy consumption, welfare services, industrial and agricultural output, for example) and simply fall in some proportion to the supply of energy.
But most are now dependent on a global supply chain which is only sustainable with cheap fuel, and will fail fairly quickly. In the UK we consume more energy and food than we produce, and those are both pretty critical “factors of production” for the rest.
All economic activity is dependent on a functioning financial system, which as far as I can see can only function under conditions of increasing energy input to maintain the integrity of the “interest repayment” assumption.
We take our health for granted, but we have it because of access to clean, hot water, refrigeration, heating in the winter and complicated industrial processes for manufacturing exotic antibiotics. There is a nasty positive feedback, bistable situation that exists around energy input/general health.
And I believe we are much closer to conditions of social disorder than most people think—friends of mine in the police force tell me that after a couple of nights without street lights they would lose control of the streets. Social conditions now and those in pre-war Britain are totally different. Social stability is a “positive externality” of energy supply—something you get for free and, therefore, don’t think about very much. We are only ever three consecutive meals away from anarchy.
I don’t see how you maintain conditions if you have no way of feeding people properly, staying healthy, paying wages and maintaining social order.