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Op-ed views and opinions expressed are solely those of the author.
One of the troubling characteristics of today’s civic discourse is the tendency to confuse predictions with reality. Nowhere is this problem more severe than in the debate over climate and its associated issues.
The last hundred years have seen increasing emissions of carbon dioxide – a benign gas. In reality, this slight increase in atmospheric CO2 concentrations (from 0.03% in the nineteenth century to 0.04% today) has brought nothing but beneficial effects, including increased crop yields and greater drought resistance. Nonetheless, climate alarmists argue that rising temperatures are bringing catastrophic storms, flooding, disease, inundation, extinction and general misery. Unlike the benefits of CO2 which are clear and measurable, climate catastrophe remains nothing more than a prediction generated by computer models which have never produced meaningful forecasts of climate impacts.
A frequent corollary of climate alarmism is that the world has undertaken a radical transformation of the global energy system away from fossil fuels toward zero-carbon, renewable energy. A Google search of the term “energy transition” yields over 5 million hits, many accompanied by terms such as “unstoppable” and “irreversible”. But is this transition actually taking place? Three arguments are generally offered – none of them valid.
First, “energy transition” supporters point to the high growth rates for renewable energy sources with wind increasing at over 20% annually since 2000 and solar at over 40% per year, compared to less than 2% for fossil fuels. Sounds great, but the absolute numbers tell a different story. In 2019, despite forty years and trillions of dollars of subsidies, wind energy contributes about 2% of total global energy use and solar just over 1%. Fossil fuels accounted for 84%, down just two percentage points over the last 20 years.
Second, even highly respected publications such as the Financial Times run articles questioning whether oil companies can survive the tidal wave of renewables. The oil industry is indeed in serious financial trouble today as a result of the pandemic-driven collapse of oil demand and the oversupply brought about by technological production advances such as fracking. But oil is a transportation fuel with very few points of competition with renewables, which are primarily used to generate electricity. Renewables may be profitable today, but only because their profitability is supported by captive markets and massive subsidies, while oil companies live or die by the market. It remains to be seen what will happen with oil company profits when the pandemic ends, but the issue will be oil supply and demand, not renewables.
Finally, the advent of electric cars is increasingly touted as the death of oil. The US private vehicle fleet is currently on the order of 250 million vehicles, of which approximately 1 million or 0.4% are battery electric vehicles. Electric cars are at present about twice as expensive to produce as comparable gasoline models, and, like renewable power generation, depend on massive subsidies for their viability. Take Tesla, for example, which is currently the darling of the auto industry. In addition to direct subsidies for manufacturing facilities and purchase credits ranging from $2,500-7,500 per vehicle, Tesla sells emissions credits to other car companies to meet California regulatory requirements. These credits have totaled over $1 billion over the last year and account for Tesla’s entire free cash flow over this period. Tesla loses money on each car it manufactures.
California Governor Gavin Newsome has banned the sale of new gasoline cars beginning in 2035. As with many such political promises, this “ban” is simply a goal, not a policy. Governor Newsome is 53 years old and will be long gone from office by 2035, and the media will lose interest in whether his objective was met or not. For the moment, however, the Governor can bask in the glory of his signaled virtue.
The world may someday transition away from fossil fuels, but it’s not happening yet. All we have so far are predictions, wishful thinking and the waste of large amounts of money for a small impact on a non-problem. I predict that the public will grow tired.