The next lines in the dialogue are:
Physicist: Then in order to have real GDP growth on top of flat energy, the fractional cost of energy goes down relative to the GDP as a whole.
Economist: Correct.
This seems to require the statement as actually written, not just a steelmanned version of it. If all the physicist had said was "let's use real instead of nominal values", he wouldn't get to make this inference.
I don't think that's the case. Suppose we deal with real numbers- so $10,000 represents my fraction of the static population's static energy consumption. If my consumption grows from $100,000 to $200,000, the fraction of my consumption that energy represents is now 5% instead of 10%. That means that energy is really getting cheaper- if I continued spending 10% of my consumption on energy, I would get more energy (in whatever form it's useful to me in, which may actually represent less watts).
That is, your statement- that energy prices rise with GDP and oth...
A dialogue discussing how thermodynamics limits future growth in energy usage, and that in turn limits GDP growth, from the blog Do the Math.
I think this is quite relevant to many of the ideas of futurism (and economics) that we often discuss here on Less Wrong. They address the concepts related to levels of civilization and mind uploading. Colonization of space is dismissed by both parties, at least for the sake of the discussion. The blog author has another post discussing his views on its implausibility; I find it to be somewhat limited in its consideration of the issue, though.
He has also detailed the calculations whose results he describes in this dialogue in a few previous posts. The dialogue format will probably be a kinder introduction to the ideas for those less mathematically inclined.