By Noah Rothman
Wednesday, October 06, 2021
New York Times columnist Thomas Friedman is
concerned. Energy prices are spiking all over the globe, setting into motion a
confluence of events that could destabilize Western democracies and augment the
power enjoyed by anti-Western petrostates like Iran and Russia. Worst of all,
he writes, “I fear we’ll see a populist backlash to the whole climate/green
movement.” The Times headline advises its readers to commit to
an ideological goal ahead of this crisis: “Don’t Blame the Greens.” But
Friedman doesn’t seem to have taken this advice.
The columnist accurately notes that the proximate causes
for a looming energy crisis are multifarious, and some are driving this
emergency more than others. Foremost among them is the pandemic. Energy
production fell off a cliff when demand for transportation and its associated
fuels declined to an artificial low in 2020. That, he further notes, led
investors to pare back speculative financing of capital-intensive projects such
as the development of new natural gas deposits and crude wells. That, in turn,
has led producers to be cautious about responding to market pressures by
increasing production. What’s more, foreign energy producers have not responded
to these conditions by increasing supply.
But other key factors leading to the impending supply
crunch, according to Friedman are the ways in which environmentally cautious
Western governments are reducing their respective carbon footprints “in totally
uncoordinated ways, from the top down, and before the market has produced
sufficient clean renewables like wind, solar, and hydro.” It boggles the mind
how this articulation of green energy policy objectives and their associated
consequences somehow absolves the “greens” of complicity.
The sloppy, blinkered effort to transition away from
fossil fuels to hypothetical sources of power that cannot meet the energy
consumption needs of the planet due to the constraints imposed on them by the
laws of physics is an obstacle to meeting “newly minted environmental, social
and governance standards for clean energy.” Friedman goes on to mourn the
existence of “nice” greens, whose politics preclude the use of transitional
hydrocarbons such as natural gas or even nuclear energy. One wonders if the
column’s headline writers bothered to read the piece.
Of course, the United States has not been spared the
consequences of green imprudence. The same people who brought you rolling power
outages in California (before the onset of the pandemic) as a response to resource deficiencies and green energy politics are now dictating terms from Washington, and with predictable
consequences. As one market strategist with the investment banking firm Federated
Hermes told Axios reporters, the political commitment to transitioning away
from fossil fuels in developed economies has put downward pressure on
production. “All of those different moving pieces took U.S. energy production
down by about 2 million barrels a day over the course of the last year, at a
time when demand has surged based on the global reopening trade,” he said. That is partly a result of the Biden
administration’s actions.
Shortly after he entered office, Joe Biden shut down oil and gas
leasing on federal land and directed executive agencies to eliminate spending
that serves to subsidize fossil fuel industries. Even as benchmark crude prices
increased, Biden’s policies forced developers to abandon transit pipelines such as
the Keystone XL pipeline, among others. The activist class is so dead set
against pipelines they’re even opposed to the idea of transit networks that would
store greenhouse gases in underground facilities. The technological marvels
that produced the
fracking revolution—the developers of which quickly became the world’s
“swing” energy producers that could stabilize the global market in the event of
a supply shock—have been handcuffed. No wonder speculative long-term
investors in the development of energy sources are spooked.
The intended consequence of these
policies was to create artificial energy scarcity and incentivize alternative
fuel producers to enter the marketplace. “If you restrict the supply (of oil
and gas), you alter the market and you create a better environment for more
sustainable fuels,” New York University professor Max Sarinsky told the Associated Press. This was all part of the plan, to the
extent there was a plan.
So, yes, there’s a lot of blame to go around if what
Friedman forecasts to be a dark, cold, and scary winter materializes. No small
share of that blame should be apportioned out to the central planners who
sought to kneecap the existing energy market in favor of an insufficient
alternative. Friedman calls these the “nice” greens. But if the intended
consequences of their policy preferences result in engineered hardships for the
developed world and increased geopolitical influence for despots and theocrats
abroad, that doesn’t seem so very “nice” to me.
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