It’s time to cut green waste … and pursue a proper energy policy


Roupthink says Russiainvasion of Ukraine shows which we rely on too much fossil fuels. This is only partially correct. A more accurate assessment would be that, still relying on fossil fuels, Western politicians have not recognized the reality of the energy transition for years: we still need them. Lobbyists and “science” suggest politicians thought they could wave around emission targets like some magic wands that would fix everything and reach pure zero by spraying an economic tale of supply and demand.

Ukraine emphasizes the importance of energy security, not pure zero. I am not a fan of fossil fuels, but I understand the difference between availability and absence. Any fool knows this, just not our fools in Westminster, Washington or Brussels. Not only does the lack of supplies lead to uncertainty – see Germany’s dependence on Russia – but it also makes the poorest people poorer because energy demand is relatively inelastic.

The lack of investment has affected not only oil projects upstream, but also throughout the energy supply chain. For example, in 2017, the British government refused to subsidize the renovation of the Centrica Rough storage facility in the North Sea, leading to the closure of a facility that provided 70 percent of our natural gas storage for three decades. A clean zero meant there was no incentive. Prices rose last fall due to lack of storage and are now back lower than last year.

And it’s not just politicians who are to blame for the city and the investment community. Elon Musk recently called ESG a scam. Of course, environmental friendliness is widespread because fund and asset managers are quick to claim that they are aligned with zero value, whatever that means. I believe this meant that important funds were distributed incorrectly.

This cycle is self-fulfilling; ESG commitments, return on investor requirements and regulatory pressures encourage investment in short-cycle over long-term oil. The move to a shorter barrel cycle creates a semi-permanent supply shortage that supports higher oil prices, exacerbating inflationary pressures.

You can dress it differently, but since no one has thought about how to build a bridge, we stay on the other side, looking at pure zero, wondering how to get there when prices for things we can use are rising.

The Bank for International Settlements, BIS, a kind of supervisor of global central banks, warns that the world is facing a “paradigm shift” in inflation. Referring to inflation factors, it notes that “investment in fossil energy sources has been surprisingly restrained, not least due to the uncertain transition to zero emissions.” While an “orderly transition,” which involves a timely increase in investment in green energy, can lead to relatively small short-term costs and bring sustainable long-term profits … a chaotic shift in which the adoption of clean energy technologies lags behind but carbon-intensive sources closed will decline rapidly, which will entail significant costs in both the short and long term ”.

Obviously, we are in the middle of a “chaotic” change. Turns in the energy markets over the past 2 years confirm this. The totem that abolished the Keystone XL Pipeline showed a lack of strategy. The energy policy is still Byzantine. President Biden is urging the Saudis to extract more oil when the U.S. has sufficient capacity. Meanwhile, the G7 is trying to limit Russian oil prices through some as yet uncertain process. France wants to limit all oil prices. Looking to cut off electricity this winter, when Russia cuts gas supplies, Germany is deploying coal-fired power plants – it has abandoned its nuclear plant after Fukushima. Guess where the coal came from? (without prizes for receiving Russia).

It is now felt that the blind leads the blind.

And should we in the UK worry about our emissions? CO2 emissions in the UK today account for 1% of total emissions; In China, more than 30%. Even per capita we produce 50% less emissions than the Chinese.

There are significant trade-offs from achieving pure zero at all costs. A simple case of the law of diminishing marginal profitability: every time we reduce 10% of our emissions, we each time reduce much less than the total, but with a much higher price for ourselves. China produces more greenhouse gases than the entire developed world combined. We’ve already sliced ​​a lot; the last mile is always the hardest and, in this case, the least productive; it is much better to spend money on ensuring that emerging markets do not increase their emissions than the virtues that signal from here. It is estimated that pure zero could cost the UK economy more than £ 1 trillion over the next few decades – salami reduces our CO2 emissions just as the balloons of India and China seem ridiculous.

Xi Jinping has promised to reach zero emissions by 2060 with a peak no later than 2030, but China builds dozens of new coal-fired power plants each year. It’s good that Xi doesn’t need to worry about Greta Thunberg, as she will never dare go to Beijing for fear of being locked up. The Global Energy Monitor report shows that in 2021, China accounted for 52 percent of the 176 gigawatts of coal capacity being built in 20 countries. The other main culprit is India. Why should we make ourselves poorer as long as they continue to blacken the air and give Putin a backdoor for his oil exports?

There are also questions about the technology of replacing fossil fuels. Biomass can increase CO2 emissions and deplete forests. The extraction of lithium, a key component in batteries for electric vehicles, has significant environmental and social impacts, including water pollution and depletion. Even if you set this aside, the supply of several metals, which are crucial for the transition to green energy, is highly concentrated in just a few countries – China is number one in such as vanadium, graphite, molybdenum, aluminum and lead. small. In the week when NATO recognizes the material danger from China, we must recognize the danger of outsourcing our energy and the fact that it is inseparable from national security and prosperity.

The point is not that reducing emissions is a bad idea, just a blind pursuit of pure zero. If you need to do more here, do so for security reasons. But onshore wind turbines look awful – like Bowis ’home building stuck in the countryside. And they kill tits. And they have a fairly short life cycle. And they only work one day a week. Hydro only operates half a mountain in Scotland. The offshore wind requires so much copper that there can never be enough to sustain it indefinitely. Like solar.

At the moment, a nuclear cornerstone is the only answer to both zero and security. At the same time, we don’t have to worry about using fossil fuels when we build this future. A clear, long-term, ambitious energy policy is required for the next 100 years, not the next ten. Australia also has the world’s largest uranium reserves. Perhaps they should be next to join NATO.

It’s time to cut green waste … and pursue a proper energy policy

Source link It’s time to cut green waste … and pursue a proper energy policy

Back to top button