The fossil fuel industry knows something about making money from energy production. The decomposition of dinosaurs and their primordial swamps have been the foundations of vast fortunes around the world for more than a century.
The fortunes of oil and coal have also lead to the degradation of human and planetary conditions. A significant portion of fossil energy profits are funneled into propaganda to whitewash the environmental destruction these products cause. Seriously, Clean Coal?
Another segment of profits have been directed into political corruption. You see the most egregious examples of this in countries that have vast oil revenues and destitute or tightly oppressed and controlled populations like Nigeria, Sudan, Saudi Arabia, Russia, etc.
In our country, you see the most fossil-fuel oriented politicians moving in the same direction as these abjectly corrupt governments. This has resulted in the concerted effort by all Republicans and fossil-fuel-funded Democrats coming together to block significant investment in renewable energy.
These political hacks, held in thrall by fossil-fuel interests, are indeed fossils themselves. Their corruption-induced ignorance is holding back the biggest explosion in wealth and progress ever conceived.
Larry Fink, CEO of asset management company Blackrock said the following in his annual letter,
Engineers and scientists are working around the clock on how to decarbonize cement, steel, and plastics; shipping, trucking, and aviation; agriculture, energy, and construction. I believe the decarbonizing of the global economy is going to create the greatest investment opportunity of our lifetime. It will also leave behind the companies that don’t adapt, regardless of what industry they are in. And just as some companies risk being left behind, so do cities and countries that don’t plan for the future. They risk losing jobs, even as other places gain them. The decarbonization of the economy will be accompanied by enormous job creation for those that engage in the necessary long-term planning.
The next 1,000 unicorns won’t be search engines or social media companies, they’ll be sustainable, scalable innovators – startups that help the world decarbonize and make the energy transition affordable for all consumers. We need to be honest about the fact that green products often come at a higher cost today. Bringing down this green premium will be essential for an orderly and just transition. With the unprecedented amount of capital looking for new ideas, incumbents need to be clear about their pathway succeeding in a net zero economy. And it’s not just startups that can and will disrupt industries. Bold incumbents can and must do it too. Indeed, many incumbents have an advantage in capital, market knowledge, and technical expertise on the global scale required for the disruption ahead.
Larry Fink’s prediction is supported by severe and exacting academic analysis.
Researchers at Oxford University in the UK published a working paper last September that produced a startling conclusion:
Rapidly decarbonising the global energy system is critical for addressing climate change, but concerns about costs have been a barrier to implementation. Most energy-economy models have historically underestimated deployment rates for renewable energy technologies and overestimated their costs. The problems with these models have stimulated calls for better approaches and recent efforts have made progress in this direction. Here we take a new approach based on probabilistic cost forecasting methods that made reliable predictions when they were empirically tested on more than 50 technologies. We use these methods to estimate future energy system costs and find that, compared to continuing with a fossil-fuel-based system, a rapid green energy transition will likely result in overall net savings of many trillions of dollars—even without accounting for climate damages or co-benefits of climate policy. We show that if solar photovoltaics, wind, batteries and hydrogen electrolyzers continue to follow their current exponentially increasing deployment trends for another decade, we achieve a near-net-zero emissions energy system within twenty-five years. In contrast, a slower transition (which involves deployment growth trends that are lower than current rates) is more expensive and a nuclear driven transition is far more expensive. If non-energy sources of carbon emissions such as agriculture are brought under control, our analysis indicates that a rapid green energy transition would likely generate considerable economic savings while also meeting the 1.5 degrees Paris Agreement target.
In other words, increasing the rate of adoption of renewable energy systems can not only save a ton of money, but help save our planetary lives in the bargain.
Another report with a paragraph-long name, “A report for the UK-China Cooperation on Climate Change Risk Assessment Phase 3 project, funded through the prosperity programming of the Foreign, Commonwealth and Development Office and developed in cooperation with The Royal Institute of International Affairs (Chatham House)” produced this set of bullet points for policy makers:
- A rigorous analysis of the historical cost trends of energy technologies shows that the decades-long increase in the deployment of key renewable energy and storage technologies (e.g., solar, wind, batteries, and hydrogen) has gone hand-in-hand with consistent steep declines in their costs.
- In contrast, non-renewable energy technologies have seen no significant deployment-related cost declines over the last 50 years.
- These long-term technology cost trends appear to be consistent and predictable.
The bottom line is that there is a hell of a lot of green to be made in going green. While many people focusing purely on the wealth factor complain about Elon Musk, he is the first super-billionaire whose fortune is largely based on alternative energy factors. As odd a duck Musk may be, he has demonstrated what is possible in this sphere.
Another article from five years ago demonstrates the stakes with a small example. The tiny island of Ta’u in American Samoa used to import 100,000 barrels of fuel at a time to keep the island’s electrical grid running. This was replaced with 5000 solar panels and 60 Tesla battery packs. The island no longer imports that fuel. This means no one is making money from selling it to them.
Imagine this revenue shift in a larger picture. Like the island of Puerto Rico or Hawaii. Or a state. Or a nation.
To steal from M. Night Shyamalan, “I see dead companies. They don’t know they are dead.” Economies that run entirely on fossil fuels can now be likened to zombies trudging along one lumbering dead step after another. Like the eternal pump jacks lining the horizons of oil fields.
As David Leonhardt of the New York Times noted this morning:
In the U.S. today, only one of the two major political parties is worried about climate change — the Democratic Party. Republicans in Congress have opposed almost every major effort to combat change in the 21st century. So have the last two Republican presidents, George W. Bush and Donald Trump. Some Republicans say they support certain climate policies, like a carbon tax, but they tend to do so only when the policies are theoretical, not when they are up for a vote.
Of course Republicans are joined in their fossil-corrupted ranks by Democrat Joe Manchin who has personal interests in coal.
It is the sun that brings life to our planet and has already shown its potential to be the source of renewed life in our economy and society. Time to leave the fossil fuels behind in the ground and leave fossil politicians behind at the ballot box this November.