Also, did I mention that the water generally comes from non-renewable aquifers?
These seem like big hurdles. In theory, it could be sustainable by building lots of desalination plants in California, and using large amounts of electricity to make freshwater and somehow safely getting rid of the salty brine that's left over so as to not kill the ocean, and pumping the water through a massive set of pipelines over the mountains and into the desert.
One wonders if that would actually produce enough energy to power all of the infrastructure needed to supply the water. In any case, it seems difficult.
A lot of people, including otherwise intelligent economists, simply assume that if oil supply falls short and prices rise, that price signal will simply lead to new forms of energy being invented and put into place. I used to believe this, but in light of practical problems like this, the idea seems increasingly suspect. Technology isn't created or powered by a magical process that will solve all of our problems, much as the history of the past couple of centuries might make it seem that way.
The theoretical basis people use to justify their belief that new technology will automatically come into place given price rises in old energy is the supply and demand curve, and something called the substitution effect.
If the price of one thing rises (eg. apples), then we have an incentive to replace it with something else that will serve a similar purpose (oranges). This much is true, if simple, but the fault lies in assuming that it works for all things*, and for all things fairly quickly. The details of energy infrastructure substitution are more difficult than apples and oranges. Some problems:
1. Consumer goods are easy to substitute. Infrastructure, however takes a long time, particularly when the infrastructure either hasn't been invented or perfected yet. You will always have unforeseen problems such as the water shortage mentioned above.
So even if people want to switch to something new, it might take a while for that to materialize.
2. You may simply have no good substitutes. So far, nothing has been shown to combine the portability and power of fossil fuels. We can and should still try to develop alternate forms of energy, but we have no magic guarantee that they will provide us with the same abilities as our current sources. Inasmuch as we depend on lots of energy to keep our society going, this means we need to prepare for this second possibility.
Which is why I think we ought to put in place a carbon tax NOW. Price signals will have some effect in moving us to the right direction, but we have no idea how fast, smooth or even possible the transition will be. So best to push the process along faster now, and not assume that "the market will take care of it when the time comes".
And since the energy we will use to build these new sources of energy will come from fossil fuels, trying to build new sources will only get harder if oil gets scarcer and prices rise. Better to start now while prices are still reasonable.
* Insulin is a good example where the substitution effect does not work. Economics deals with these situation through a concept called elasticity of demand, and elasticity of supply. In other words, how easy is it to go without or supply more of a certain product. Insulin is not easy to go without, to say the least, so it has a "inelastic" demand. Large increases in price do not reduce demand.
So, technically what I'm saying here is that oil has a fairly inelastic demand and supply. But people forget about elasticity (if they knew about it) when they imagine new energy sources will spring forth out of the ether once the incentives are right.
Because effective substitution is a common outcome in our society does not mean that it is inevitable. Large spikes in price or substitution to inadequate substitutes are also possibilities allowed by the model.
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