In the past five years of writing about energy, one of my favorite observations has been that people get into trouble because they "confuse Peak Oil and the Peak Oil Debate." In other words, they confuse what Peak Oil IS and what Peak Oil MEANS. I wrote about this in a January tweetstorm copied below for your review...Read More
The energy consumption of our datacenters isn't something we normally think about, but it's significant. Right now datacenters in the U.S. account for 2.5 percent of U.S. electricity consumption, sufficient to power every household in New York City twice over. The explosive growth of the internet and the continued development of "cloud" data storage and processing will only expand datacenter energy use in the future. In fact, datacenter energy consumption is already expected to double in just eight years...Read More
A busy summer is coming to a close, but the good news is that it finally gives me more time to write. Expect more soon, but as a teaser, enjoy this overview of the history and ongoing contributions of National Academies of Sciences, Engineering, and Medicine.
You don't kill Peak Oil by pointing out that the price is low. You don't kill it by bringing up incorrect predictions that only prove predictions are difficult. You don't kill it by confidently proclaiming near term peaks in demand and pretending that somehow solves any and all production challenges. And you don't kill it by wildly affirming your faith in innovation and an unwavering belief in human ingenuity.
You kill it, quite simply, by continuously increasing the global rate of oil production.Read More
Recently I had the good fortune to surpass my 13,000th day. It's a big deal. But I know what you're thinking: Who actually counts their days? What's the point of that? What's going on here?
All good questions.
But let's answer a more basic question first: How do you discover your own day?Read More
Autumn has arrived. And here's a collection of Summer 2016 oil stories you may have missed:
- "Welcome to the Age of Crappy Oil" by Nafeez Ahmed (August 18, 2016)
Here Dr. Nafeez Ahmed gives us a Peak Oil update by way of reviewing the new paper "Energy shift: decline of easy oil and restructuring of geo-politics." He writes that the authors, "refute what they call 'a common misperception about peak oil': that fossil fuels are growing scarce. Rather, they argue, peak oil means it’s getting more difficult and costly to get oil out of the ground—and there’s less of the cheaper, easy oil available. "
Recall that the definition of Peak Oil is simply the "maximum rate of oil production" - every one of those words is critical. And a great deal stands on how one chooses to define the word "oil." Total global oil production has not yet reached a peak, but what we do know is that conventional oil production clearly has peaked. Yet total oil production has continued to climb due to growth in unconventional production. The paper's authors, as well as Dr. Ahmed, remind us that while it's important to focus on total global oil production, it's also important to acknowledge and understand the significance of the changing ratio between conventional and unconventional production. Total oil production today is vastly different than it was 15 years ago.
- "Is the Oil Industry Dying?" by Richard Heinberg (August 10, 2016)
In the Pacific Standard, noted Peak Oil author Richard Heinberg examines the issue in the context of an industry squeezed on both sides - by rising production costs and lower oil prices. Heinberg writes:
"The problem of eroding energy profitability is hard to deal with partly because the decline is happening so fast. If we had a couple of decades to prepare for falling thermodynamic efficiency, there are things we could do to soften the blow. That’s what the peak oil discussion was all about: It was an effort to warn society ahead of time. Once the dynamic of declining energy profitability really gets rolling, adaptation becomes much more difficult... We need to build a bridge to the energy future, even while the highway we’re on is crumbling beneath us."
- "Oil Discoveries at 70-Year Low Signal Supply Shortfall Ahead" by Mikael Holter (August 29, 2016)
In Bloomberg, Mikael Holter highlights the little noticed shortfall in conventional oil discoveries:
"Explorers in 2015 discovered only about a tenth as much oil as they have annually on average since 1960. This year, they’ll probably find even less, spurring new fears about their ability to meet future demand."
A famous ASPO chart from the past decade was known as the "Growing Gap" chart. It showed conventional oil discoveries and oil production and a gap between ever increasing production and the high points of oil discoveries which occurred in the 1950s and 1960s. Diego Mantilla updated the old growing gap chart based on the new WoodMac data highlighted in the Bloomberg article to produce a new graphic:
Meanwhile, in Forbes, noted Peak Oil critic Michael Lynch was quick to point out that the decline in conventional discoveries is no big deal writing "...will the poor exploratory performance persist? Probably not, as companies adjust their budgets, use up projects in the development pipeline, and costs come down as the overheated upstream sector has cooled. Then, too, the more money that goes into shale, the less the need for expensive conventional fields—and the less the need for discoveries."
- "Oil flirts with US$40 on oversupply but analysts warn falling investment is a ‘ticking time bomb’" by Grant Smith (August 2, 2016)
Part of the reason for the decline in oil discoveries is simply due to the low oil prices that are resulting in investment declines. Finding oil costs money and it's hard to make those investments when low prices are squeezing you so tight that you're struggling to keep the light bills paid.
On their blog, WoodMac recaps the carnage:
"The dramatic fall in oil prices – from over US$100 a barrel in mid-2014 to less than US$30 a barrel in early 2016 – has left the oil industry scrambling to contain the damage. Upstream operators are deferring investment decisions, cutting activity and headcount and putting pressure on suppliers. Governments faced with falling oil revenues are reviewing fiscal terms. Service companies have responded to thin order books by reducing capacity. In the case of the Majors, cash for dividends now means increased borrowing."
Way back at CERAWeek in February, IEA Executive Director Fatih Birol was raising alarms on these investment cuts: "It is easy for consumers to be lulled into complacency by ample stocks and low prices today, but they should heed the writing on the wall," Birol said. "The historic investment cuts we are seeing raise the odds of unpleasant oil-security surprises in the not-too-distant-future. Last year, oil capital expenditures (capex) declined by 24 percent, and this year we expect an additional 17 percent. This is historic, because in the last 30 years we have never seen oil investment decline in two consecutive years. If there was a drop one year, the next year there was a rebound. We expect this drop to have both short and long term implications for oil markets."
In a recent report, John England and Andrew Slaughter at Deloitte conclude that, at minimum. the global upstream industry will need to invest about $3 trillion during 2016-2020 to ensure long-term sustainability.
It's an open question if anyone actually wants to spend that money for less than stellar returns. Recall Steven Kopits' wonderful talk from over two years ago where I wrote:
"Kopits addresses the "flatness" of oil production since 2005, and why the decline has not been steeper. In short, this is because we threw a lot of money at it to the tune of $3.5 trillion spent maintaining the legacy oil and gas system since 2005. What did we get for all this invested money? Sadly what we got was a decline in legacy oil production of 1 million barrels per day (mbpd)."
If you are a member of the "Peak Demand" school which suggests a near-term peak and fall of worldwide oil demand, you know that lower demand = lower oil prices = making all of these investment problems even worse.
Or if you're a member of the traditional "Peak Supply" school, then you see thermodynamic and geologic constraints to future oil production growth, no matter how much money we throw at the problem.
Either way you can see a path to reaching a "maximum rate of oil production" otherwise known as: Peak Oil.
Far too often we hear about the worst parts of DC, but every once in awhile, you get one of those days that speaks to how special this town truly is and this past Saturday was one of them.
- I saw huge crowds gathering for the opening ceremony for the National Museum of African American History and Culture. It was a collection of fantastic speeches from everyone including Rep. John Lewis, Chief Justice John Roberts, Presidents Obama and Bush, and so many others.
- It was hard not to be moved when hearing the Chief Justice speak passionately about the things the Supreme Court got wrong in its long history, or to hear President Bush proclaim "A great nation does not hide its history. It faces its flaws, and corrects them." You should definitely watch the entire event via the CSPAN archive. It was truly something to see.
- And "the hug" made us all briefly forget that the first Clinton/Trump debate is in just a few hours.
- From the National Mall, I had just thirty minutes to make it over the Convention Center for a 1:00PM session at the National Book Festival featuring Candice Millard, author of the phenomenal "Destiny of the Republic." I sprinted from the Washington Monument, down Independence Ave., under the Department of Energy Headquarters, and over towards L'Enfant Plaza metro station. There's a place, in the concrete paradise of L'Enfant Plaza, where you briefly cross over the 9th Street Expressway and the moment I got there I could hear the sirens of approaching police motorcycles - the usual call of an impending motorcade. It's a common DC sound, something that quickly becomes part of the background noise. But this time I decided to stop and watch the motorcade speed by into the tunnel underneath.
- Over at the Convention Center, the National Book Festival already swelled with huge crowds of book lovers and smiling children. In a mastery of DC transit, I was only five minutes late to the aforementioned session with Candice Millard. Later I heard John Meacham give a powerful talk on his 9-years interviewing the 41st President for his book "Destiny and Power: The American Odyssey of George Herbert Walker Bush."
- Later, I ran into Rep. John Lewis again. In the morning, I watched him on the giant screens on the National Mall. Now in the afternoon, I watched him from the front row as he spoke on his powerful graphic novel, "March." To my everlasting disappointment, I don't think CSPAN recorded his talk, it was one of the best John Lewis speeches I've ever heard. Sitting in that audience that day, was a privilege I won't soon forget.
These are some of the memories that make DC a special place, the unmistakable sense of being surrounded by history.
"'I believe Barack Obama understands that fifty years from now no one’s going to know about health care,' the lobbyist said. 'Economic historians will know that we had a recession at this time. Everybody is going to be thinking about whether Barack Obama was the James Buchanan of climate change."Read More
The annual EIA conference is this week and unfortunately I can't make it this year, but I'll definitely be following along using the #EIAconf hashtag. I'm looking forward to many of the sessions, including ARPA-E's Dr. Chris Atkinson speaking on the future of the automotive and transportation sectors.
But the super-star session of Day 1 is the Oil Supply session. Historically, these are pretty optimistic affairs, with the notable exception of Matt Simmons in 2008 (and the GAO almost had to twist arms to get him as a speaker) it's rare for the EIA to book speakers that really stray from the "everything is fine, and getting better everyday" path.
To that end, some of the narratives/themes I expect to hear about in the Oil Supply session:
- Saudi Arabia tried and failed to slay US shale, which proved resilient
- Innovation in technology marches ever forward, leading to lower breakeven costs for US shale
- Innovation in technology is quickly improving shale's Achilles heel - the severe production decline rates
- Prices have risen and shale is on the verge of springing back to life
- US oil reserves are growing, ensuring production prosperity for the foreseeable future
- Peak demand is on the near horizon thanks to electric vehicles, natural gas, and other factors. You need not worry about Peak Supply anymore.
And some narratives/themes I'm hoping to hear about, but we probably won't:
- Low price environment has led to an unprecedented two straight years of declining upstream investments, a serious hole in production sustainability that might cost upwards of $3 trillion to fix
- The under-investment situation is an oil volatility & price spike time bomb, it's not a question of if, it's a question of when
- Prices still aren't high enough for shale, the resurgence is still a ways off
- Shale's debt and financial problems are still a thing, they didn't just vanish with recent oil price increases
- Meanwhile, outside of US shale in little discussed conventional oil, the situation is still terrible like it's been for years. Last year the oil industry discovered only 2.8 billion barrels, the smallest amount in 64 years
- Speaking of other "not shale" stuff, a reminder that US shale is a significant, but small part of total global oil production - at some point, asking US shale to hold everything up on its own becomes too big of an ask
- Not so fast on Peak demand, you might want to still worry about Peak Supply
On to the session speakers:
I had very high praise for Jamie Webster's EIA conference talk in 2014 and it was precisely because of its boldness. The energy prediction business is hard and unforgiving work. You look at the data at hand, acknowledge your biases, then do your best to say which way the wind is blowing. Then when the dust settles you look at what you got right, what was wrong, re-evaluate the data, and do it again. Doing that honestly takes courage. I didn't agree with everything Webster said in 2014, but I'm definitely looking forward to his new talk on the supply situation. Notably, look for him to continue his recent push to get people to stop calling the US a "swing producer."
Now you know that all of us over here on the "oil depletion" side of the room are definitely looking forward to Michael Lynch's talk. It's safe to say that Lynch has earned the banner of the preeminent Peak Oil critic, earning the title away from David Blackmon, who sometimes seemed to exist only to repeatedly call any peakist he met a religious cultist. Like Blackmon before him, Lynch now runs a weekly energy series at Forbes that alternates between telling us how much the Peak Oil people were wrong because they were misinformed, misguided, or both. To be fair, Lynch is enjoying a well-earned victory lap during these times of low prices. Did the low price environment come about exactly the way he predicted, not exactly, but nuance is sometimes lost in energy discussions. And in broad terms, when prices are low, long-time oil optimists like Lynch look really good. And when prices are high, people pay more attention to the peakists. Unlike many of his contemporaries, Lynch does a decent job of being a Peak Oil critic the correct way. There are legitimate arguments to make against Peak Oil, unfortunately most pundits avoid those tough arguments and focus instead on misinformation and strawmen to carry their positions. Lynch does a better job than most of keeping the discussion focused correctly on the rate of oil production. His conveniently timed new book, "The "Peak Oil" Scare and the Coming Oil Flood" is available for pre-order on Amazon and I expect it to stand taller and on a better foundation than other similar works.
Lars Eirik Nicolaisen:
Rystad Energy has made some bold statements this year, none more so than their recent report suggesting that the US has larger oil reserves than Saudi Arabia. Anytime reserves are mentioned in any context, it's worth it to first pause to revisit key supporting information like this explainer from the EIA and a great piece on why and how reserves change by Robert Rapier.
On the US side, Rystad estimates that US reserves are now higher than Saudi Arabia, when you include the strong disclaimer that "undiscovered fields" are included in the value. Whenever higher reserves are mentioned, it's impossible for some to resist that oldest piece of Peak Oil misinformation, pretending the issue about about total oil when it's not. It's the old issue of reserves vs rates, and the surest tell of its appearance is the use of the phrase "running out." Anyone that ever uses the phrase "running out of oil" is someone that either a) doesn't properly understand Peak Oil or b) is someone trying to mislead an audience about Peak Oil.
The definition of Peak Oil is simply "the maximum rate of oil production." Peaking in production and running out of oil are not even remotely the same thing. And reserves, by themselves, don't actual tell you anything about the rate of production, the metric we use to determine Peak Oil. To use the old water faucet analogy, it's not the size of the tank that matters, it's the size of the tap that's important. Or to think about it another way, what if someone told you that new lottery winnings were just deposited for you in a special bank account, but what they forget to mention is that you can only withdraw a few hundred dollars per day from a single ATM located a day's hike up a mountain. If the question is how wealthy you are, you'd think more about the lottery winnings. If the question is about day-to-day cash flow, you're going to think more about the ATM. That's reserves vs. rates.
But if you can trick an audience into believing that Peak Oil is about "running out of oil" then you've set yourself up for a very easy debate victory. So it's no surprise that the moment the Rystad news dropped, some of the usual folks were were pushing the same tired talking points.
Ronald Bailey was at the front of the line to proclaim "Peak oil still nowhere in sight" in his latest blog. Investor's Business Daily IBD provided an even worse piece that began with the title "Death of Peak Oil is Not Exaggerated" (a nod both to Mark Twain and the sub-title of Ron Patteron's Peak Oil Barrel blog), and the piece ends with this send-off: "As for "peak oil" proponents and their political pals who scared Americans and influenced U.S. energy policy for years with tales of vanishing supplies and soaring energy prices, it's time to buy a new fright mask. This one doesn't work anymore." At no point between the title and that final line, did IBD actually explain Peak Oil to the reader, or outline how rising reserves eliminates Peak Oil as a issue of concern.
Oil industry group Energy in Depth (EID) tries an even more challenging balance. In their piece "After Pushing Peak Oil Theory, Activists Want to Stop Fracking Because We Have “Too Much” Oil and Gas," EID continues to try to lump three different groups, climate hawks concerned that we have too much oil to burn for climate reasons, the Peak Demand school (who believe that oil demand will soon peak), and the Peak Supply school (traditional peakists that focus on limitations of supply). These are not all the same people and they don't all hold the same positions. Much like EID likes to label anyone that even questions the debt and financial problems of shale as "anti-fracking," this is more of them trying to pretend that their opponents are one giant block that laughably flip-flops from one position to the other to suit their needs. It's a false narrative.
Looking at the issue from the Saudi Arabia side is interesting as well, because effectively what Rystad is saying is that the Saudi reserves aren't nearly as large as the Kingdom claims. But it's a troublesome position, because if you believe that (and a lot of people do) then it puts you right in line with agreeing with Matt Simmons. As Saudi Arabia reassesses after their failed attempt to defeat US shale, and with their new aggressive goals to wean their own economy off of oil, it's safe to wonder if energy analysts will begin to revisit their opinion of Simmons.
What Rystad is saying here isn't exactly radical thinking, as John Kemp notes "If the [Saudi] government data is accurate, the kingdom has managed the remarkable feat of exactly replacing each produced barrel with new discoveries or increased estimates of the amount recoverable from existing fields."
Joseph Kechichian adds, "Clearly, the insinuation here is that Saudi Arabia is doctoring numbers to maintain proven reserves more or less at the same levels since the mid-1980s, when the 260 billion barrels figure first appeared."
Outside of the collective cheering by most on the US news, Rystad themselves strike a more restrained note in their own release saying: "This data confirms that there is a relatively limited amount of recoverable oil left on the planet. With the global car-park possibly doubling from 1 billion to 2 billion cars over the next 30 years, it becomes very clear that oil alone cannot satisfy the growing need for individual transport."
It'll be interesting to see how Nicolaisen sums all of this up in his much anticipated talk.
The fall meeting of the American Geophysical Union (AGU) was back in December 2015, and video from the Peak Oil panel was recently released.
- Asher Miller, Executive Director of the Post Carbon Institute (PCI) moderates the panel.
- James W. Murray speaks at the 50:00 mark on "Oil Production, The Price Crash and Uncertainty in Climate Change." You may recall that Murray joined with David King in 2012 for the article "Oil's Tipping Point Has Passed."
- J. David Hughes speaks at the 1:15:00 mark on "Unconventional Liquids, Peak Oil and Climate Change." Hughes is known for his many papers studying shale production featured on PCI's website shalebubble.org
- Richard Heinberg speaks at the 1:37:00 mark on "What Geological, Economic, or Policy Forces Might Limit Fossil Fuel Production?" Heinberg is known both as a PCI senior fellow and for his collection of books he has authored on these issues.
When you read the report today, almost a decade later, one is struck both by the measured language (a key component of all GAO reports due to the very rigorous review process) and also the realization of how little anyone actually listened to the report's recommendations...Read More
Videos and Photos are available from the 2016 ARPA-E Innovation Summit. You can view the agenda for the speaker list and visit ARPA-E's Youtube channel to view the the fireside chats from speakers such as EPA Administrator Gina McCarthy, President of the World Bank Group Dr. Jim Yong Kim, Senator Lisa Murkowski (R-AK), and former Vice President Al Gore (below).
The Fast-Pitch sessions from the Summit are always worth a watch. They provide a glimpse into new areas of focus from the ARPA-E Program Directors. Everything from advanced photonics to increase the energy efficiency of datacenters, to miniature nuclear power plants, to the challenges of developing a smarter electrical grid able to integrate distributed generation and renewables, to even examining plant roots to develop the next generation of biofuels.
The Summit is a showcase of achievements possible when we combine great ideas with business, academia, and the government - all working together to improve our energy future.
Below is a tweetstorm I did previewing a new multi-part weekly series that will appear on the blog in early 2016. The topic: the proper understanding of Peak Oil. The first part of the series will present the one (and only) definition of Peak Oil and explain why it's important for people to understand and adhere to that definition, and how to avoid the number one mistake frequently made in these discussions: confusing Peak Oil and the Peak Oil Debate. They are related, but different. The next posts in the series will each examine an individual issue often used to proclaim that "Peak Oil is dead." These pronouncements are almost always incorrect because the author is focusing on an unrelated metric instead of the only metric directly related to Peak Oil: the rate of oil production.
Issues of oil supply and depletion are critical to our energy economy. It's important to discuss these issues soberly, rationally, and frequently. And productive discussions will only occur when all parties are operating on a set of common definitions and a proper understanding that serves as a barrier against misinformation.Read More
What if we took away all our modern fuels and then asked ourselves how much human power would we need in order to produce the daily tasks we've all grown accustomed too? By one calculation, to replace the energy of just one gallon of gasoline in your car - a gallon that cost you less than the price of a cup of coffee - would take hundreds of energy slaves, and that's not too big a stretch when you think about what it would take if humans had to literally push and pull your car to take you on your daily commute...Read More
Everything from the oil industry getting crushed by low prices, the Iran Deal, Shell gives up in the arctic, Keystone XL is rejected, renewable energy tax credit extensions, and the hottest year in history.Read More
David Hughes is probably the foremost authority on tracking shale gas and tight oil production. And in collaboration with the Post Carbon Institute, Hughes is out with his latest update "Eagle Ford Reality Check: The Nation's Top Tight Oil Play After More Than a Year of Low Oil Prices."
It's a great review of what's happening in the largest tight oil play in the U.S. and how they're coping with low prices. The short version: they're not, and production is dropping because of it.
Consider that U.S. tight oil plays already have to deal with the dual challenges of steep decline rates (which Hughes has previously covered at length) and debt/investor issues. Add onto that low oil prices far under tight oil's breakeven points - and all of this is a giant recipe for lower production.
Will the U.S. ever beat it's November 1970 peak of oil production? The answer is probably going to have to wait until later 2016/2017 when oil prices are once again high enough to justify production gains again. Shale promoters argue that there is a "fracklog" of new production just waiting for the proper price to be unleashed. Yet Hughes argues that the best days of the best plays might already be behind us.
If he's right, it's quite possible that OPEC's war on U.S. production, and the lower prices that were the result, might have robbed the shale drillers of their one window to set a new all-time U.S. oil production peak.
"The hype surrounding tight oil as a means to bolster global oil production over the long term is not justified. Geological fundamentals clearly show that high decline rates, limited sweet spots, and finite numbers of drilling locations will limit long term contributions to production. The Eagle Ford and Bakken plays have peaked after only a few years, and although they have made a significant short term impact, their best days are behind them. The Bakken and Eagle Ford are unique in that they were developed from scratch, whereas other plays in the Permian Basin, Niobrara and elsewhere are redevelopments of old plays (which have been producing for decades) with new technology. The optimistic tight oil forecasts of the EIA, and even more optimistic forecasts of some industry watchers, are unhelpful abstractions in developing energy policy for a more sustainable future."
As a country we challenge ourselves annually to #NeverForget 9/11. We also have to challenge ourselves to #NeverForgetSandyHook and one of the true tragedies of American history that occurred there at 9:41AM on December 14, 2012.
We must never forget the lives lost, including the twenty precious children.
In the process of writing this post, I was shocked to discover a community of Youtube-based conspiracy theorists who adamantly believe that the Sandy Hook massacre never happened, that it was all a giant hoax. Thankfully, very few people subscribe to that theory. But just in case you run into someone that does, Snopes.com has gone through great efforts to painstakingly debunk each of the ridiculous hoax claims: http://www.snopes.com/politics/guns/newtown.asp
On some level, it's hard to blame them. The tragedy in Newtown is of such unrelenting horror that's it's easier for some to pretend that it did not happen at all.
But it did happen. The event should be permanently seared into our minds, a constant fuel for not words, but for concrete action to prevent these atrocities from occurring in the future.
Having a position in the gun control debate - no matter what that position is - in no way absolves us from the duty to take action to form real solutions to this national problem. All of us share that burden. All of us share that responsibility. All of us share the ire of the future should we shamefully choose to do nothing.
It begins by never forgetting tragedies like Sandy Hook, and using that anger to fuel real and lasting action.
This! - Because you know, actually addressing domestic and global challenges could cost you an election. Can't have that apparently. But one imagines that the people tasked to deal with our issues won't be none to happy with us in the future. Sorry, grandkids, our bad.
Or, to quote Iron Man, "That's how Dad did it, that's how America does it, and it's worked out pretty well so far..."
One more quick post about Adam Conover's new show since I originally wrote about it back in September. ReasonTV recently aired a short interview with Conover explaining some of the key themes behind the show and its obvious influences from programs like The Daily Show and Last Week Tonight.
If nothing else, the grand lesson is that we can always afford to spend more time examining our cultural norms, asking why we do things, and thinking about how we want things to look going forward.
If you work for a large company, you probably have some type of annual review process. Most people hate them, but the reason they exist is just to give everyone a chance to formally think about things.
Society at large needs to have more "reviews." If I could wave a magic wand over our democracy, I'd suggest that we have state-organized constitutional conventions every 25 years. Not something tied to elections, nor something people would have to vote on - something automatic coded into the system itself. A 25-year review that would give society a new and needed opportunity to assess where we are and where we want to go.
Today is December 5th - Repeal Day. A reminder - of something we tend to forget in modern times - that we can amend the constitution, and if we happen to screw up completely, we can then amend the amendments too. Getting to a more perfect union means occasionally changing things, taking risks, assessing the results, keeping what works, and discarding what doesn't. But that process takes the type of political courage our country hasn't had in quite some time.
So for now, just think about smaller bits of our culture and democracy. Spend some time over on John Oliver's youtube channel. Wonder openly why things like tipping in restaurants, the lottery, Columbus Day, our criminal amount of food waste, and pennies - yes pennies, are all still things.
The short answer is that change takes effort, change is hard, and sadly it's a lot easier for everyone to just continue with the status quo because... tradition.
Seriously though... the penny thing makes zero sense on any level.