By Paul Homewood
h/t Ian Magness
Send in the men in white coats!
The shibboleths of the old energy order fall away. The International Energy Agency has systematically struck down every economic and social objection to net zero.
“The message is clear: a new global energy economy is coming, which is cheaper, cleaner, safer, more resilient, and much fairer across countries,” said Fatih Birol, the director of the agency (IEA).
For two decades the IEA was aligned with the fossil industry, apt to treat renewables and electric cars in its World Energy Outlook as a romantic niche interest. This year the data tables begin with supply figures for solar, wind, bioenergy, and so forth. The lines for oil, gas, and coal are relegated to the bottom.
Those of us who follow the annual report as the catechism of the energy markets can only gasp with astonishment. Even more surprising is to hear Mr Birol issue a pontifical anathema against fossildom on the eve of Cop26 in Glasgow.
“I would like to see world leaders come together and give this message to investors: we are united in building a clean energy future and we are giving you an unmistakable signal that if you continue to invest in dirty energy you are going to lose money, big time,” he said.
The nexus of solar, wind, batteries, hydrogen, electrolysers, and critical minerals will displace the oil industry as the big global beast, accounting for 80pc of international energy-linked trade by 2050. This of course creates a new vulnerability.
The new term “mineral security” jumps out of the pages. One might deduce that aircraft carriers and foreign military bases will leave the Persian Gulf to protect the supply lines for copper, lithium, nickel, and cobalt coming from such places as Africa. Aukus submarines may patrol hydrogen pipelines from Australia to South East Asia.
This is where the superpowers will skirmish under net zero, and where it could all go wrong. How easily can the world find the raw materials for the IEA’s projected increase in utility scale batteries from 20 gigawatts to 3,000 by mid-century?
Yet overall the report is marvellously uplifting, an answer to the climate doomism of Extinction Rebellion. It counters the pervasive assumption that curbing CO2 implies economic “degrowth” and vegan austerity evermore.
A decarbonisation dash will instead accelerate economic growth, lifting global GDP by an extra 0.4pc annually over the next decade. The 5m jobs lost in oil, gas, and coal will be trumped by up to 24m green jobs, and three-quarters of these will be local.
It will lower the average household cost of electricity, heating, cooling, and transport fuel from $2,800 to $2,300 a year by 2030 in wealthier countries, with gradual gains to follow as the energy share of disposable income falls from 4pc to 2pc by mid-century. Energy bills in the developing world will creep up, but that is because of rising affluence.
And so on!
AEP first faux pas is his claim that the IEA was aligned with the fossil industry. In fact since its formation in 1974, the IEA has been a creature of its rich, Western member governments.
Because they have all committed to the renewable agenda, the IEA has had to slavishly follow their diktats for years, forced to give some sort of credibility to the Net Zero agenda. Every year, Fatih Birol comes out with nonsense like this.
The whole of the latest IEA Outlook has been written around this premise. But that does not mean that the report has any credibility itself.
Nowhere in the report can I find a mention of the fact that wind and solar power still only account for 4% of the world’s energy:
BP Energy Review
And despite the guff that AEP writes about solar farms in Morocco (yes, that would be a good idea, putting out energy supply at the mercy of jihadists!), and green hydrogen, neither he or the IEA have actually managed to explain how the world’s economy can run largely on intermittent renewable energy.
This IEA Outlook is not an objectively written assessment, but a fanciful wish list, designed to provide a fig leaf to western governments, as they push their Net Zero plans.
There is an assumption in the report, for instance, that governments around the world will actually implement their Net Zero policies, or for that matter be able to. Consequently it is little more than a set of tables, which replace fossil fuels with renewables in the energy mix.
It also assumes that the rest of the world, the non-OECD countries which make up two thirds of the world’s emissions, will simply follow suit.
The report is forced to accept that emissions will carry on rising till 2030, but then assumes that they will miraculously decline rapidly thereafter.
AEP also talks of how 24 million green jobs will replace 5 million fossil fuel ones, and then goes on to claim that renewables will work out cheaper!
But the IEA let the cat out of the bag, when they tell us the cost of their cunning plan:
While western leaders grandstand, the rest of the world neither has the money or desire to castrate their economies in this way. They will carry on much as they are now.
AEP finishes his article by saying:
You could say that the IEA had to fall into line after the election of Joe Biden on a green deal platform. The agency is the servant of the rich consuming nations and they are signed up to net zero. But that only goes to underscore the larger point: the whole Western power structure has mobilised to force breakneck decarbonisation, and via the IEA it has at last come up with precise ways to achieve it. Resistance is becoming futile.
And, of course, he is right – this is a political construct. But it is also a pipedream, a make-believe, not a serious blue print.
Above all, it goes contra to the lessons of history. By and large, it is the free market that delivers solutions that both work and make peoples’ lives better, not government intervention and decree.
If electric cars, for instance, really are so good, people will buy them. And if solar power really is so cheap, power markets will build them without state subsidies and mandates.
Resistance, as AEP will soon find out, is only just beginning.
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October 18, 2021 at 09:00AM