Fossil Fuels Aren’t Going Anywhere
By Irina Slav - Feb 05, 2021, 6:00 PM CST
“There is no scenario where hydrocarbons disappear,” the chief executive of Baker Hughes, Lorenzo Simonelli, said during his keynote speech at this year’s annual meeting in the company. Like other executives from the industry, Simonelli acknowledged and welcomed the energy transition, but he noted that a 100-percent renewable energy scenario was simply not possible. There is plenty of evidence this is indeed the case, despite the hopes and ambitions of many environmental advocates.
These hopes and ambitions imagine a world where human activity is powered from electricity only, and this electricity in turn is being generated using only renewable energy sources such as solar, wind, and hydropower.
Such a world, however, is unrealistic.
Take Germany, for example. The country, which is among the EU members with the most renewable energy capacity, has not produced a single Watt of solar energy since the start of this year. The reason: it’s winter. It is producing solid amounts of wind power, that’s for sure, but it is also generating power from the most despised fossil fuel of all: coal.
At the time of writing its carbon intensity was 264 grams of CO2 equivalent per kWh. That was comparable to the carbon intensity of another poster girl for renewables in Europe, Denmark, which is currently getting most of its energy from wind power.
So, it seems building renewable capacity in itself is not a silver bullet solution to the emissions problem. In fact, if you build it too quickly without adding substantial storage capacity, it could backfire. This was most recently evidenced by a narrow miss of a major blackout in Europe prompted by a minor problem at a Croatian substation that rippled through the continent, highlighting the importance of maintaining the grid at a constant frequency—something renewables cannot do because of their intermittent generation.
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Even Denmark has thermal power plants to secure the baseload any grid needs to function properly and eliminate or at least reduce the risk of blackouts.
But back to Simonelli’s prediction about the guaranteed future of oil and gas. This future won’t be like the past. The world is firmly on course to change the way it generates and uses energy. Both Simonelli and the other keynote speaker at Baker Hughes’ AM2021, IHS Markit’s Daniel Yergin, recognized that. It is simply that this change will not be limited to a build-up of solar- and wind-generating capacity.
Energy efficiency, for one, will be a big part of the transition.
Efficiency has been pushed out of the spotlight recently, replaced by things like green hydrogen and the constant emission-reduction narrative, but it has not gone away. According to Baker Huges’ Simonelli, efficiency alone could help meet as much as 27 percent of the Paris Agreement climate change targets. On a global scale, this is a massive amount of emissions cut, at a rate of half a gigaton annually.
Originally Posted by WTF
I am sad to see that this thread, which was supposed to be all about me, Tiny, has gotten so far off track.
First, Japan gets along just fine without oil, natural gas or coal. If politicians decide to leave our oil and gas buried in the ground we'll get by, we'll just be poorer.
Second, Democratic politicians fit into three categories. Your class A Democrats like Maxine Waters are wasteful and stupid. So the oil and gas companies have sunk hundreds of billions of dollars into offshore platforms, pipelines, gas plants, field developments, exploration expense, and lease bonuses on federal lands and federal offshore leases. And so if you stop all development activity on those leases and just allow existing wells to deplete, you're flushing many billions down the drain. And you're taking away peoples' jobs. And depriving Wyoming schools of their primary source of funding. Who gives a fuck. We can just print money. Hey, it's just like the stimulus bill. Put a lot of people in places like New Mexico and Mississippi out of work with a $15 minimum age, and we'll just pay them more in government benefits for not working than they were getting before. Pump another 160 billion into the schools, and another 350 billion into subsidizing state and local governments -- just double up on the Biden stimulus. Full speed ahead, the national debt be damned.
Then you've got your Class B Democrats, like Mark Warner. They realize banning fracking or development of federal lands and offshore leases is plain stupid economically. But they also realize you've got a lot of one issue voters, who believe in climate change like a religion. It's like abortion. If you can get 15% of the electorate to vote for you solely for the reason that you're "enlightened" on this issue and the opposing party is not, you win the election. And what if you're actually increasing carbon emissions, when USA natural gas production falls off a cliff because fracking was banned? Who gives a fuck. We can always import coal to provide our baseload electricity. Just go for the votes stupid.
Finally you've got your Class C Democrats, vindictive politicians who want to punish the opposition or the people they hate. For example, Elizabeth Warren and Barrack Obama have it in for businessmen and rich people. Liz said on a Sunday morning show that if we had all the money in the world she'd still want a wealth tax. Charles Gibson asked Barrack if he would raise the capital gains tax to the point where it reduced government revenues. (Example: With a 75% capital gains tax, people don't sell anything, because they don't want to pay the tax. Since they don't sell, there are no capital gains to tax.) He said yes, because that would be fairer. Well, people who work in oil and gas are overwhelmingly Republicans. It doesn't matter whether they're black, Hispanic, Asian, suburban college educated white women, they vote Republican. People in Wyoming, where huge amounts of natural gas are produced from fracked wells on Federal lands, are Republicans. If you want to fuck a lot of Republicans you're not going to find many ways to do that better than fucking the oil and gas industry.
So call me Chicken Little. When I see friends put out of work because of market forces, so be it. When they lose their jobs because of pointless policies of politicians I get pissed.