Kaieteur News Texas is where the headquarters of ExxonMobil is located. But all the oil which is produced in that state could not prevent the rash of deaths and suffering caused by sub-zero temperatures now sweeping that section of the United States. Nor could the investment which the State has made in wind energy.
The arctic chill which swept this State over the past week is a wake-up call about climate change, fossil fuel development and the inequalities within the capitalist heartland. Despite the decline in aggregate greenhouse gas emissions over the past year on account of the pandemic and the consequent slowdown in economic activity, extreme weather events are still taking place. It would appear as if Mother Earth is not only rebelling against the air pollution.
The arctic freeze is also an alert to Guyana’s Vice President, Dr. Bharrat Jagdeo, who is of the belief that fossil fuels are potentially on their way out. Because of this he feels that Guyana should therefore maximize its oil production as quickly as possible. His depletion policy is essentially captured by the legend, “Drill Baby Drill! Pump Baby Pump!”
Texas is a reminder that fossil fuels will be needed long into the next century. The power went out for millions of Americans this past week. The interruptions were not entirely caused by disruptions to power plants and lines. It was also caused by the surge in demand as temperatures fell and people needed more heat. The power plants – including the renewable energy plants – in Texas could not keep up with the rise in demand.
All of this punctures Guyana’s Vice President’s presumption about fossil fuels having a short shelf-life. Given the extreme weather events which are taking place around the world and the power outages which are resulting, Jagdeo’s theory about the decline of fossil fuel use and investment is out of sync with reality.
Texas is America’s largest oil and natural gas producer. And it now says that it is committed to increasing, rather than decreasing investments in fossil fuel development. A report in the Houston Chronicle, states that lawmakers are now demanding greater fossil fuel use in the State’s energy mix and less renewable energy. One legislator has already warned about the dangers of transitioning too rapidly to renewable energy.
And while all the blame for Texas energy woes should not be laid at the feet of renewable energy, the power interruptions have certainly exposed the shortcomings of too great a reliance on renewable energy sources. For one, it is extremely expensive and inefficient to store this form of energy. Renewable energy has to be stored in batteries and this is expensive and this also makes it difficult to be able to ratchet up supply in the event of a sudden and large increase in demand such as what happens during an arctic freeze. Second is renewable energy sources have become vulnerable to breakdowns during extreme weather event. During the arctic blast this past week, frozen windmills became inoperable.
The out turn of all of this is that the world will have to continue to rely on fossil fuels for a long time. As one headline blared, “Texas winter storm highlights the importance of fossil fuels.” That report indicates that in Europe, which is pressing for reduced emission levels, solar and wind power generation is declining in many states. It points out that Sweden has seen a significant decline in wind-power generation and has been forced to import energy from Poland and Lithuania. When it comes to solar power, the report notes that the extreme cold weather in Europe has also but blunted this source of energy production with, for example, Slovenia also producing one percent of its total energy needs from solar power.
And even if per chance US fossil fuel production declines in the coming years, this does not mean that the demand for fossil fuel-generated energy will slacken, a distinction which Jagdeo apparently fails to make. As was reported in yesterday’s edition of the Kaieteur News, the United States already expects to increase imports of crude by 62 percent over the next two years. The fact therefore that Europe and America may institute measures to cut their greenhouse gas emission does not translate to a worldwide slump in demand for fossil fuels anytime in the future.
Oil companies do not make guesses about the nature of future demand. They undertake detailed studies of these issues before making investment decisions. Exxon and its partners would not have committed to investing US$20B if it was their opinion that fossil fuels would be phased out over the next few years.
But apparently someone forgot to mention this to Dr. Jagdeo. No one, it would seem, has taken the trouble to disabuse him of the ill-informed and misguided notion he has that the world is drifting away from fossil fuels. They should do so in order that he can begin to develop an appropriate Oil Depletion Policy and to put it down on paper.
(The views expressed in this article are those of the author and do not necessarily reflect the opinions of this newspaper.)
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