#hottakeoftheday David Ramsden-Wood

While I occasionally disagree with Tisha, I always enjoy her perspective on ESG and the energy future so this week, after a two year (or 14 day, depending on how you feel about the curve flattening), I welcome Tisha back to the podcast.



Here is a recent post of hers.





The Pendulum Train











I’m working on my next book, so occasionally I’m going to share my thinking here and on the Energy Thinks podcast to give you a preview and get your thoughts.



Ever since Russia invaded Ukraine, many energy observers have predicted that the renewed global focus on energy security means the global focus on climate change is over. My view is very different: I look at this moment as an opportunity for oil and gas leadership to respond to a range of social and financial pressures for cleaner energy — pressures that will only intensify. (We reviewed this dynamic in a recent Both True, The World’s Cleanest Oil & Gas on Stage.)



But while I disagree with those many energy observers on how to respond to this moment, we share at least this judgment: Politics moves like a pendulum. Below, I explore why I believe in and value the political pendulum swing — and also why I don’t think that this moment represents the end of the public focus on climate. Concern about climate isn’t a pendulum. It’s a train — and it’s not coming back.



A Pendulum or Directional Change?



Many reasonable people can (but don’t) agree that the energy-environmental pendulum has swung too far in the address-climate-at-all-costs direction. I certainly do. In a world with a lot of global challenges and priorities, the climate-apocalypse narrative certainly doesn’t work for all of us — not even a climate hawk like me.



Yet that doesn’t mean that the pendulum will swing back to some pre-2020 world.



Four significant but underrecognized structural changes over the past decade or so indicate that global interest in prioritizing climate is directional. So while we are experiencing a pendulum “correction,” we shouldn’t mistake pendulum corrections for directional change. The pendulum is on a train, and that train is going to climate town.



Below are those four structural changes, which are themselves directional. They are and will continue to drive directional change in public interest in climate:



* Investor pressure. Now that everyone from BlackRock CEO Larry Fink to U.S. Treasury Secretary Janet Yellen to the Securities and Exchange Commission (SEC) has equated climate risk with financial risk, responsible investors must put climate considerations front and center. Recent SEC draft rules reinforce how central these analyses will be to company operations and disclosures.

* Public sentiment. As discussed in my Both True What to Watch for 2022: Energy Prices, stakeholders tend to interpret current events through their own political lenses. I sat on a panel last week where one participant said the war in Ukraine was accelerating Germany’s permitting of wind facilities and another pointed out that Germany is turning coal-fired power back on. Very few people are rewriting their climate priorities in the face of world events.

* Generational change. The oldest millennials are now turning 41 and continue to take leadership positions across finance, politics, community organizations, and business. They will dominate the population beyond 2050. Gen Z has now joined the millennials in the work force; together they will soon constitute a majority of working adults. Members of these generations, even when politically conservative, prioritize climate — and that is not going to change.

* Company recruiting and retention.

It's been roughly 3 months since I last spoke with Heidi on the podcast and a lot has happened. Elon Musk is buying Twitter (in theory), the cost of living and inflation consumers are seeing is through the roof and yours truly has been re-reading "Atlas Shrugged" and finding the comparisons eerie.  Want to know how a candidate keeps their energy up and spends their time?  This is the episode for you.

This week, I welcome on Brian Gitt, who's investment thesis is that nuclear and natural gas will be the biggest winners in the energy sector over the next 20 years. He draws on 20+ years of industry experience to expose false beliefs about renewable energy and the problems with the environmental, social, governance (ESG) narrative  Here's a deep dive example of how false beliefs about renewable energy are driving bad decisions and harming people and the environment.  You can follow him on Twitter at @BrianGitt and below is a recent post from his website.



 



Europe has an energy crisis. Factories are halting operations in the face of soaring energy prices; families are paying 50% more for heating (or opting to freeze in their homes), and  Europe as a whole continues to destabilize its political position by making itself more dependent on Russia for natural gas.



Europe shows what happens when you adopt policies based on false ideas—myths about energy that all but guarantee high prices, power blackouts, and a crashing economy. Here are 6 of them:



MYTH 1: The world is transitioning to solar, wind, and batteries.



Fact: Solar and wind power are unreliable, raise electricity rates, and over-consume minerals and land. Even after investing $2.7 trillion in them over the last decade, solar and wind still produce 3% of global energy.



MYTH 2: Solar and wind power are the best ways to lower greenhouse gas emissions.



Fact: The biggest emissions reductions over the last 15 years have been due to shifts from coal to natural gas. Natural gas produces only 10% of the air pollutants and 50% of the CO2 that coal does.



Proponents of solar and wind power can talk about the potential of these technologies as much as they want, but the reality is—per Myth 1—the world is far, far away from being able to manufacture, deploy, and maintain this tech efficiently.



MYTH 3: Solar farms reduce household utility bills.



Fact: Households pay more for electricity where governments mandate solar power: households in the United States (US) pay 11% more in the 29 states with solar mandates; households in California pay 80% more than the US avg; and households in Germany saw their energy bills increase by 34% between 2010-2020 because Germany spent hundreds of billions of euros on building massive wind and solar farms.



MYTH 4: Nuclear power is dangerous.



Fact: Nuclear is the safest, most powerful and reliable way to generate low-emission electricity. Only about 200 people have died as a result of radiation from nuclear accidents in over 60 years. This number includes the accidents at Chernobyl, Three Mile Island, and Fukushima.



Even if you count the cancer diagnoses among people exposed to radiation, the harm from nuclear plant accidents remains minuscule in contrast with the millions who die every year from the effects of coal poll...

This week, I'm joined by Mark Nelson.  He is a very worthy follower on Twitter at @energybants for all the latest thoughts and threads concerning nuclear energy.  For instance, here was his thread on the rumors about the Russian forces at Chernobyl.



There are wild claims about Chernobyl going around. I will post the most accurate and authoritative information here and keep this thread updated. FIRST: Chernobyl, even if attacked, is not a credible threat to health from radiation. Several sources claimed that Chernobyl was under attack. Chernobyl's outer containment dome could be breached if targeted. Remaining hazardous material is deep under this. It's been cooling and decaying since 1986. Dispersal would take intentional, targeted effort. Keep an eye on Cheryl Rofer @CherylRofer She is correct in pointing out that it would be difficult to access this material. It is well-characterized, meaning, we know what it is and how it could spread if disturbed. Ukraine gets half its power from nuclear reactors. It shut down Chernobyl fourteen years after the explosion in 1986, under pressure from the EU and only when promised money to complete another partially-built plant. WHAT IS THE THREAT TO THE OPERATING PLANTS? Unlike at Chernobyl, Ukraine's currently operating reactors have lots of highly radioactive material inside them. They need to remain safe. If these reactors lose their connection to the grid, they will automatically shut down.  A silver lining of Fukushima Daiichi accident is that nuclear plants all over the world have prepared for what to do if cut off from off-site power from the grid. You run generators to keep the core covered with water as it cools down over several days. But the grid isn't down.



Ukraine's grid has just completed disconnecting from the Russian grid. Ukrainian grid operators are apparently working through this, and Russia does not appear to have targeted the grid. I will update if this changes. Ukraine's plants are "pressurized water reactors" of Russian design. The Russian name for this is "VVER" which means water-cooled, water-moderated power reactor. Chernobyl's design was totally different. With fixes, Chernobyl-type reactors are still in operation in Russia.



We talk about this and so so much more. Enjoy!

This week, I'm joined by David Blackmon to talk about the state of Washington, the Defense production act, Keystone and how do we get out of this mess?



 



David Blackmon is an independent energy analyst/consultant based in Mansfield, TX. He is the Editor of Shale Magazine and co-host of In The Oil Patch Radio, a nationally-syndicated weekly show. David has enjoyed a 40-year career in the oil and gas industry, the last 23 years of which were spent in the public policy arena, managing regulatory and legislative issues for various companies, including Burlington Resources, Shell, El Paso Corporation, FTI Consulting and LINN Energy. During this time, David has led numerous industry-wide efforts to address a variety of issues at the local, state and federal level, and from April 2010 through June 2012, he served as the Texas State Lead for America’s Natural Gas Alliance. In addition to client-related work, David also maintains a growing media communications practice.

This week, we visit Europe (virtually, anyway) to chat with Irina Slav, an energy writer for oilprice.com, a substack site at https://irinaslav.substack.com/ and we have an in depth chat on Europe, energy and the war in Ukraine, censorship and the green transition.  Her recent article on Boris Johnson playing intermediary for the United States in the Middle East is a must read.  I hope you enjoy.