A complete critique of web zero fantasies • Are you completed with it?


Francis Menton

Another example of a bureaucracy gone completely insane is the International Energy Agency. The IEA was formed in the 1970s as a consortium of western nations to counteract the oil price shocks caused by OPEC during those years. That seemed reasonable enough. But at some point the mission evolved, shall we say, gradually. Today, the IEA is rightly called a center dedicated to eliminating fossil fuels from the world’s energy supply.

In May 2021, the IEA published a major report entitled “Net Zero by 2050: A Roadmap for the Global Energy Sector”. The title and some of the text might give the impression that these might just be some helpful “how to” tips for reducing emissions. But you don’t have to delve too far into the document to find out that it is actually another of those insane calls for immediate, desperate action to save the planet from impending doom – except that this call came directly from Virtually every major corporation is funded by Western government. From the foreword:

We are approaching a pivotal moment in international efforts to address the climate crisis – a major challenge of our time. The number of countries committed to net-zero emissions by mid-century or soon after continues to grow, but global greenhouse gas emissions are also increasing. This gap between rhetoric and action must be closed if we are to have any real chance of reaching net zero by 2050 and limiting the rise in global temperatures to 1.5°C. Achieving this will require nothing less than a complete transformation of the energy systems on which our economies are based.

Now, two years later, a serious group comes with a broad critique of the IEA report. The critical group is the Energy Policy Research Foundation, funded by the Real Clear Foundation (the people behind Real Clear Politics) in this project. The EPRF produced its own report dated June 2023 entitled “A Critical Assessment of the IEA’s Net Zero Scenario, ESG, and the Cessation of Investment in New Oil and Gas Fields”. This report is 75 pages long and worth a look. The main author’s name is Batt Odgerel; and the editor is Rupert Darwall.

The main themes of this EPRF report are broadly consistent with some oft-repeated mantras on this site: Ignorant bureaucrats, this time from the IEA, are attempting to force the redesign of a highly complex power system, unaware of what the replacement will do, whether it will work or how much it will cost. My only real criticism of this EPRF report is that the authors adopt a serious and high-minded tone, rather than the contempt and ridicule that would be more appropriate for a critique of the IEA’s incompetent and amateurish efforts.

But with that, I’m going to select a few select quotes. Important excerpt from the foreword:

Analysis by the Energy Policy Research Foundation shows conclusively that the IEA’s assumptions are unrealistic and inherently contradictory, and often support the case for increased hydrocarbon fuel production. The IEA’s entire net-zero roadmap is based on the assumption that the falling cost of wind and solar energy will destroy demand for oil and gas. If it doesn’t, the entire roadmap will go up in smoke. But as this report shows, the IEA’s own analysis contradicts its assumption of an economic superiority of renewable energy. In reality, the IEA’s “Net Zero Roadmap” is a green mirage that will dramatically increase energy costs, devastate Western economies and increase human suffering. Therefore, by using other people’s money to advance this anti-investment agenda, investment managers and banks are violating their fiduciary duty to maximize returns for retirees, investors, and shareholders.

I just want to add that if the IEA were right that “falling costs for wind and solar power will destroy demand for oil and gas”, there would obviously be no need or reason for a government-enforced energy transition. It would happen by itself through private investment.

Here, from the EPRF report, is the state of the so-called “energy transition,” some 20 years after the start of governments’ crash program to transform the energy industry:

According to BloombergNEF, over US$6.5 trillion (nominal) was invested globally in the energy transition between 2004 and 2022 (excluding investments in power grids), but the share of renewable energy excluding hydropower was only 6.7% of total global primary energy consumption in 2021.

And here is the corresponding table:

The IEA seems to believe that electric vehicles will save the world because they are “zero emissions” and their cost will fall rapidly. Here is a table from the EPRF report on the cost of the main materials for electric vehicle batteries (which are the main part of an electric vehicle):

And as for “zero-emission” electric vehicles:

China is a world leader in sales and manufacture of electric vehicles, but it also consumes large amounts of coal. In 2020, coal accounted for 60.6% of China’s primary energy needs and 63.3% of electricity production, meaning that electric vehicles powered by electricity generated in China indirectly emit significant greenhouse gas emissions.

Finally, there is the small problem that many or most of the technologies adopted by the IEA in their net-zero transition scenarios have either not been demonstrated at scale or, more often, have not even been invented:

Energy Technology Perspectives 2023 (ETP-2023), one of the IEA’s flagship reports, recognizes that “reaching net zero is not possible without more innovation”. According to the report, in the NZE scenario, around 50% of all emission reductions in 2050 will come from technologies that are now in the prototype or demonstration stage.

There is much, much more to this report if you have the time and inclination. Anyway, thanks to EPRF and the Real Clear Foundation for taking the trouble to expose the ridiculousness of the fossil fuel phase-out campaign before anyone has any idea what will replace it.

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