WOGNEWS

WOGNEWS, Global Energy Market News is a publicly available information portal about the global energy market and industry. The portal contains information in text, video and photo formats since January, 2014.

Post

GLOBAL CLEAN ENERGY DOWN

Posted to WOGNEWS

GLOBAL CLEAN ENERGY DOWN

GLOBAL CLEAN ENERGY DOWN

GLOBAL CLEAN ENERGY DOWN

PLATTS wrote.

Current geopolitics may be hurting future oil and gas growth in politically unstable countries, but could also slow the global transition to cleaner energy sources and hinder efforts to combat climate change, panelists at a US Association for Energy Economics conference said Monday.

Protectionist and populist policies are promoting additional fossil fuel production, often at the expense of investment in low carbon technology, said Andreas Goldthau, a professor and research group lead at the Institute for Advanced Sustainability Studies in Germany.

"The world has become less cooperative in recent years," Goldthau said. "That gives you a big problem on a global scale."

Current geopolitics, rife with politicization, trade wars and sanctions, will make sustainable energy goals "extremely difficult," said Eirik Waerness, Equinor's senior vice president and chief economist.

"If we don't have conducive geopolitics, I think there is a risk that we won't have any energy transition," Waerness said.

Waerness said the energy transition will likely require a low level of geopolitical conflict.

"The current situation slows down that transition and exacerbates the situation," he said.

The transition away from carbon-intensive energy could be "uneven" if national oil companies do not invest and is already complicated by the record growth of US shale oil and natural gas output, said Wim Thomas, Shell International's chief energy adviser.

"The success of shale oil has postponed the energy transition by at least a decade," Thomas said.

Amy Myers Jaffe, director of the Council on Foreign Relations energy security and climate change program, said oil sector sanctions imposed by the US, particularly in Iran and Venezuela, have gotten relatively little pushback from allies. This is partly because of the shift away from the scarcity paradigm, where a supply peak is anticipated, as well as concerns about investment risks in politically unstable countries.

"You can just feel the loss of power on a visceral level," Jaffe said.

Rather than peak supply, national oil companies and oil majors are concerned about stranded assets, or oil and gas fields which might not be developed because of declining demand. Jaffe said the shift might change how producers develop fields. Aramco, she pointed to as an example, is looking to not only develop the lowest cost oil but the lowest carbon oil, in line with EU and other climate goals.

"They want their oil to be the one that remains on the market," Jaffe said.

Vladimir Vinogradov's picture

Thank Vladimir for the Post!

Energy Central contributors share their experience and insights for the benefit of other Members (like you). Please show them your appreciation by leaving a comment, 'liking' this post, or following this Member.

WOGNEWS
WOGNEWS, Global Energy Market News is a publicly available information portal about the global energy market and industry. The portal contains information in text, video and photo formats since January, 2014.

Discussions

Bob Meinetz's picture
Bob Meinetz on Nov 5, 2019 3:57 pm GMT

"If we don't have conducive geopolitics, I think there is a risk that we won't have any energy transition," Waerness said."

Anaologous to our situation in California, Vladimir, where non-conducive state politics are putting our local energy transition at risk.

Vladimir Vinogradov's picture
Vladimir Vinogradov on Nov 6, 2019 5:05 am GMT

Bob, what about California? 

Bob Meinetz's picture
Bob Meinetz on Nov 7, 2019 11:33 pm GMT

Vladimir, California policy is dominated by oil and natural gas interests. Multi-national holding companies selling "energy" (a pseudonym for oil) have donated over $120 million to state politicians since 2010 (energy recently replaced healthcare as the largest source of political influence). And it goes all the way to the top - investments in natural gas financed the political aspirations of both ex-governor Jerry Brown and his successor, Gavin Newsom.

Unsurprisingly, the only significant energy transition taking place in California is the replacement of nuclear energy by natural gas, largely by hyping far-fetched prospects for storage of solar and wind.

Many electricity consumers here don't understand that the same company selling them electricity charges them for the fuel used to generate it - at a price wholly unregulated by state authorities. The more gas PG&E, Edison, or Sempra burn, the more money they make. The opportunities are, quite literally, unlimited.

Thus, ours is a transition not toward cleaner, more economical energy, but toward energy which consumes a lot of fuel. That's got to change.

Vladimir Vinogradov's picture
Vladimir Vinogradov on Nov 7, 2019 8:28 am GMT

What is the energy policy of the federal government? Does the federal government influence the California government?

Bob Meinetz's picture
Bob Meinetz on Nov 7, 2019 11:34 pm GMT

Big question, but in a nutshell: since 2005 the U..S Securities and Exchange Commission (SEC) no longer has regulatory oversight of multi-state energy holding companies (Sempra, Exelon, others). When the Energy Policy Act of 2005 took effect state utility commissions were supposed to take responsibility for that; some did, others didn't.

The Federal Energy Regulatory Commission (FERC) has control over mutli-state transactions, but doesn't have the expertise, authority, or resources to investigate antitrust violations of "self-dealing" - energy companies selling themselves fuel from their own subsidiary, then charging customers for it.

Vladimir Vinogradov's picture
Vladimir Vinogradov on Nov 10, 2019 3:02 pm GMT

Is it a monopolisation of the US energy market?

Bob Meinetz's picture
Bob Meinetz on Nov 11, 2019 11:52 pm GMT

The US energy market (like most in the world) is made up of individual, regional monopolies. The only way to avoid it would be either 1) having public (state-owned) distribution, or 2) running multiple sets of wiring on poles to each customer, so they could choose between different providers.

Nearly every IOU (investor-owned utility) in the US is a monopoly structured as a holding company, some with hundreds of subsidiaries. They are amazingly creative at devising ways to exploit their customers, and are largely beyond the reach of regulators.

Get Published - Build a Following

The Energy Central Power Industry Network is based on one core idea - power industry professionals helping each other and advancing the industry by sharing and learning from each other.

If you have an experience or insight to share or have learned something from a conference or seminar, your peers and colleagues on Energy Central want to hear about it. It's also easy to share a link to an article you've liked or an industry resource that you think would be helpful.

                 Learn more about posting on Energy Central »