Share this @internewscast.com
So many interesting conversations this past week. During a chat about energy issues with the CEO of an advisory company, he stopped mid-sentence and said, “You know, our main problem right now is that those who are making all these decisions are not serious people.”
The CEO of one industry trade association, discussing last week’s decision by the Biden administration to cancel three more scheduled federal lease sales, told me that, “by this point in Barack Obama’s first term, his Interior Department had conducted more than 50 such sales.” Sixteen months into the Biden administration, the number remains stuck on zero, even as the administration continues to harangue the industry for failing to produce more oil and gas.
I was asked early this week by Faiza Rizbi, Senior Editor for ESG at Hart Energy, for my thoughts about Elon Musk’s recent dustup with S&P Dow over its de-listing Tesla
While S&P Dow obviously has a right to formulate its index using the metrics of its choice, I certainly think Musk has a valid argument in that regard.
The ESG movement is an outgrowth of the “Keep it in the Ground” movement, which itself was an outgrowth of the “Divestment” movement that germinated early in this century. Given that investment firms like BlackRock
Are the people making those decisions serious people? Given that they control trillions of dollars, does that question really even matter?
We are living through a time in which policymakers everywhere are engaged in promoting the energy policies of wishful thinking. The International Energy Agency and its chief, Fatih Birol, seem to view their function as being the global messengers for this set of policies. Over the past couple of years, Mr. Birol has taken to portraying every set of facts, every international crisis as an opportunity to call for more renewables. Indeed, every report issued by the IEA makes sure to include that policy based on wishful thinking as a primary part of the executive summary.
Oil prices too high? Mr. Birol’s answer is “more renewables.” War in Europe? “More renewables.” Even when Europe faces a massive energy crisis and has been scrambling to secure more natural gas, oil and coal since last fall precisely due to a failure by the wind industry to live up to its promises, Mr. Birol’s answer is “more renewables.”
The IEA said in its latest Renewable Energy Market Update that “New capacity for generating electricity from solar, wind and other renewables increased to a record level worldwide in 2021 and will grow further this year as governments increasingly seek to take advantage of renewables’ energy security and climate benefits.” While the growth in wind, solar and other renewables this year may well happen, the situation in Europe – which is now impacting the entire world with vastly higher energy costs – should make a serious person wonder exactly what “energy security” benefits these renewables actually provide?
But none of that phases Mr. Birol, who just doubles down on his “more renewables” mantra, commenting that “Energy market developments in recent months – especially in Europe – have proven once again the essential role of renewables in improving energy security, in addition to their well-established effectiveness at reducing emission.” Again, what “energy security” is he referring to where Europe is concerned? If Europe had actually possessed any real level of energy security, it is unlikely Vladimir Putin would have conducted his invasion of Ukraine in the first place.
It’s all evidence of an energy policy based on wishful thinking instead of thoughtful analysis based on facts as they exist in the real world. The IEA and western government leaders wish wind and solar can replace fossil fuels and provide energy security, and appear to believe that, as in a Disney movie, their wishes will all come true if they just keep wishing upon that renewable star.
To put it bluntly: If the answer to every set of facts, regardless of how divergent they might be, is “more renewables,” then you are not promoting anything resembling a serious energy policy.
We saw another little vignette along these lines at this week’s World Economic Forum held every year in Davos, Switzerland. During a panel discussion about the “energy transition,” the moderator asked audience members to raise their hand if they own an electric car. Just four hands in the room went up in response. It’s a clear example of the old lawyer’s advice to never ask a witness a question unless you already know what the answer will be. The moderator wished everyone in Davos drove an electric car, and assumed most hands would go up. Had she asked how many in the audience arrived in Davos in a private jet powered by jet fuel derived from crude oil, her wish for most attendees to raise their hands would have been fulfilled.
The Biden administration seems just as dedicated to riding on this wishful thinking energy train. Energy Secretary Jennifer Granholm, asked this week about actions the administration is considering taking to address high oil and gasoline prices, held out a possible freeze on oil exports as one such possible action. This is surreally wrongheaded, beyond wishful thinking into the realm of energy suicide.
A ban on U.S. oil exports would cause production from shale to crash, and prices to skyrocket. Why? Because there is at least a 2 million barrel per day deficit of U.S. refining capacity capable of processing the light, sweet grade of crude coming out of America’s shale formations. That looming refining mis-match was the main motivating factor behind the industry’s push to repeal the 1970s-era ban on crude exports back in 2015 in the first place.
Ending the ability to export those barrels would cause the immediate shutting-in of thousands of shale oil wells, and create a situation of utter chaos in the global oil markets. This is not really even an arguable point.
But apparently Sec. Granholm and other Biden officials wish they could use an export ban to appear to be “doing something” about high energy prices, so she says they’re still considering it as an option. Stunning.
Are Granholm and other Biden officials serious people making decisions based on a rational examination of facts and reality? It would be generous to say even that it’s hard to tell after what we have seen for the last 16 months. Given that this is the level of seriousness our global and national leaders seem to possess, is it any wonder then that we find ourselves in the midst of the most severe energy crisis in any of our lifetimes?