A hy­brid en­ergy in­dus­try has the best chance of be­ing sus­tain­able

The National - News - - BUSINESS | IN DEPTH - Robin Mills is chief ex­ec­u­tive of Qa­mar En­ergy, and au­thor of The Myth of the Oil Cri­sis

The Black Coun­try Mu­seum, near Birm­ing­ham in the UK, is a mon­u­ment to the 18th-Cen­tury In­dus­trial Rev­o­lu­tion. The area got its name from the coal found there. If en­vi­ron­men­tal cam­paign­ers have their way, other ar­eas would soon change from cen­tres of wealth and power to mu­se­ums of the ob­so­lete oil and gas busi­ness.

On Novem­ber 15, the Euro­pean In­vest­ment Bank (EIB) an­nounced it would stop fund­ing all fos­sil fu­els projects at the end of 2021. For some years, coal has be­come in­creas­ingly un­pop­u­lar, but the de­ci­sion to end fund­ing for oil, and par­tic­u­larly gas, is more strik­ing. The gas in­dus­try has pro­moted its prod­uct as a rel­a­tively clean fuel: just half the car­bon diox­ide emis­sions of coal. Now they, too, are in the crosshairs.

The Trump ad­min­is­tra­tion in the US may have at­tempted to turn back the clock on en­vi­ron­men­tal poli­cies, but the var­i­ous Demo­cratic chal­lengers are un­der ac­tivist pres­sure to put for­ward more rad­i­cal cli­mate plans, sev­eral cen­tring around a “green New Deal”.

The UK has com­mit­ted to elim­i­nate net car­bon diox­ide emis­sions by 2050, while the Labour Party in the cur­rent elec­tion prom­ises a zero-car­bon en­ergy sys­tem and a ban on new petrol or diesel car sales by 2030.

The aim is laud­able and es­sen­tial. Euro­pean oil and gas com­pa­nies have al­ready read the writ­ing on the wall, and be­gun turn­ing to in­vest­ments in float­ing off­shore wind tur­bines, so­lar power, bat­ter­ies and elec­tric ve­hi­cle charg­ing.

Euro­pean oil com­pa­nies have al­ready lost the bat­tle for pub­lic opin­ion, even if they re­tain some in­flu­ence over pol­i­cy­mak­ers. Yet the de­mon­i­sa­tion of fos­sil fu­els is prob­lem­atic too, on four counts.

Firstly, the scale and speed of the chal­lenge is not ap­pre­ci­ated by the gen­eral pop­u­la­tion. The UK alone will need to in­stall 4,000 elec­tric ve­hi­cle charg­ing points and heat pumps for homes ev­ery day from now to 2050 to meet its goals. If the tran­si­tion leads to much higher en­ergy prices or black­outs, pub­lic opin­ion could re­verse, block­ing the new mo­men­tum on cli­mate ac­tion.

Se­condly, the fo­cus only on “net zero” tar­gets is mis­guided. What mat­ters for cli­mate is not the emis­sions in a par­tic­u­lar year, but the cu­mu­la­tive emis­sions over a long pe­riod. Switch­ing coal for gas has caused the UK’s emis­sions to fall faster than any other ma­jor econ­omy.

Thirdly, the ef­fect of the tran­si­tion on em­ploy­ees, com­mu­ni­ties and coun­tries has to be man­aged. As with the Black Coun­try, or coal-min­ing com­mu­ni­ties across north­ern Eng­land, north-east­ern France, or West Vir­ginia, or Detroit’s “Mo­tor City”, the loss of tra­di­tional in­dus­tries hits hard. New jobs in re­new­ables or elec­tric ve­hi­cle man­u­fac­tur­ing will not nec­es­sar­ily be in the same place or need the same skills.

Fourthly, the Euro­cen­tric or West­ern-cen­tric de­bate misses more than 80 per cent of the global pop­u­la­tion. Cli­mate is an im­por­tant con­cern for China and In­dia now, but more im­me­di­ate is the fight against coal pol­lu­tion, which can be eas­ily cleaned with gas.

Al­most a bil­lion peo­ple, mainly in Africa but also across South Asia, lack ac­cess to mod­ern en­ergy. Their needs are rel­a­tively triv­ial in a West­ern con­text: a few watts to run a light­bulb and tele­vi­sion, charge a phone, and some gas or elec­tric­ity for cook­ing and heat­ing.

Re­new­able ad­vo­cates ex­tol the ben­e­fits of de­cen­tralised “mi­cro­grids” in re­mote com­mu­ni­ties, run­ning on so­lar, wind and rivers. These in­deed have great po­ten­tial for en­abling peo­ple to take the first steps to elec­tri­fi­ca­tion. The anal­ogy is made with mo­bile phones, which have en­abled Africa to leapfrog land­lines.

But 40 per cent of the sub-Sa­ha­ran African pop­u­la­tion is now urban, liv­ing in emerg­ing megac­i­ties such as La­gos, Jo­han­nes­burg, Kinshasa and Dakar.

These cities need in­dus­trial em­ploy­ment and large-scale power pro­vided by util­ity-scale wind and so­lar farms along­side gas.

Sene­gal’s En­ergy Min­is­ter, Mouhamadou Cisse, re­cently ex­plained how his coun­try would use its new off­shore gas dis­cov­er­ies, along­side re­new­able en­ergy, to re­place coal and bring power and in­dus­try to his coun­try peo­ple. The ur­gency of the sit­u­a­tion does not per­mit well-mean­ing ex­per­i­ments at run­ning coun­tries en­tirely on re­new­ables, barely achieved any­where.

De­vel­op­ing coun­tries also ac­cuse high-in­come coun­tries of hypocrisy, of deny­ing them the use of their own nat­u­ral re­sources, when the West’s wealth was built on fos­sil fu­els and its out­size per capita con­sump­tion con­tin­ues. And poorer coun­tries, es­pe­cially in the trop­ics and sub­trop­ics, are most ex­posed to ris­ing tem­per­a­tures, de­ser­ti­fi­ca­tion and the other plagues of cli­mate change.

If rel­a­tively clean en­ergy is not fi­nanced by the EIB and other west­ern in­sti­tu­tions, then oth­ers such as China will step in.

Re­search by my col­league David San­dalow at Columbia Uni­ver­sity’s Cen­tre on Global En­ergy Pol­icy has shown that the elec­tric­ity side of Bei­jing’s Belt and Road Ini­tia­tive fo­cuses al­most en­tirely on con­struct­ing coal power plants abroad, mostly of low ef­fi­ciency.

Fos­sil fuel com­pa­nies should not use “en­ergy ac­cess” as a cyn­i­cal tac­tic to per­pet­u­ate de­pen­dence on coal, oil and gas in de­vel­op­ing coun­tries. The threat of los­ing pub­lic ac­cept­abil­ity and fi­nanc­ing is real and grow­ing. But a blan­ket ban is coun­ter­pro­duc­tive. A hy­brid en­ergy in­dus­try blend­ing re­new­ables, elec­tric­ity, hy­dro­gen, car­bon cap­ture and gas has the best chance of be­ing fi­nan­cially, en­vi­ron­men­tally and so­cially sus­tain­able.

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