A recent article on HuffingtonPost by Alexander Kaufman exposed how fossil fuel utilities knew about climate change as far back as 1968. The information was revealed in a newly published report by the Energy and Policy Institute, “Utilities Knew: Documenting Electric Utilities’ Early Knowledge and Ongoing Deception on Climate Change From 1968-2017.” We all know, or should, that because the fossil fuel industry has known about climate change for so long, it stands to reason that in battling the science, it has spent millions of dollars to lobby against any government action to regulate the emission of so-called greenhouse gases generated by burning coal, oil, and natural gas, which nearly all climate scientists agree is the main reason why temperatures are rising globally. The industry not only torpedoed proposed legislation and regulations to control emissions, it sponsored research by captive “scientists” to counter and impugn the conclusions of real scientists, thereby confusing, misleading, and sowing doubt among the general populace. Multi-million dollar advertising campaigns promoted the American way of life, which included of course lots of driving around in big, gas guzzling, fast cars. Lately the ads have stressed that America needs all forms of energy, they’re all good. The industry’s efforts have successfully produced a nation, and especially a Republican Party, of climate skeptics and deniers.
The utility industry has constantly engaged in the same well-funded multi-year, multi-faceted effort to shape a government and a public opposed to, or at least indifferent to or ignorant of, the growing threat that climate change posed to the industry, the country, and the Earth as did the fossil fuel industry.
The separate but similar efforts of the fossil fuel and electric utility industries succeeded for many years, but they are beginning to founder, for the simple reason that the threat of climate change has become a reality. The transition of the world’s energy system from high-carbon to low-carbon is well under way; it is now irreversible, inevitable. Renewables like wind and solar are now cheaper in most places than coal, oil, and natural gas. Utilities are also beginning to face disruption as the long-time industry model of one-to-many, from electricity-generating plant through the grid to many subscribers devolves into one in which many sites generate power, wind turbines and solar farms, including end-users who generate their own power from rooftop solar panels, and provide their surplus to the grid. The intermittency issue of wind and solar is being addressed with bigger and better batteries.
Both fossil fuel and utility industries are huge, they will be around for many years, but both face transformation by mid-century. Neither will disappear, but it’s a safe bet that your kids, and theirs, will know a very different energy system from the one we’ve known all our lives. It’s also a safe bet that changes to the energy system will reverberate throughout every aspect of life. The economies of many countries depend on oil; Venezuela provides an example of the destabilization that can result from a prolonged decline in the price of oil. Even Saudi Arabia is looking to diversify its economy. How will Iran react when its big earner fizzles? Or Russia? The world’s banks have many billions invested in energy and utility companies; how much of that investment can they write off without jeopardizing their own continued viability? The values — and the share prices — of the oil majors are underpinned by vast reserves of untapped oil they carry on their books. As oil becomes less and less an essential commodity, its price will fall, rendering more and more of those reserves uneconomic to exploit. If it doesn’t pay to pump it out of the ground, its value plummets to near zero, and the stock price falls too. State-owned oil companies don’t have to worry about their stock prices, but the states do count on their foreign exchange earnings for a large part of their budgets. Without that income, their hold on power first wavers, then topples.
Add to this upheaval in the energy sector other expected climate-related impacts: droughts, heatwaves, floods, storm surges, extreme weather, rising seas, crop failures, hunger, social unrest, political instability, refugees, migrations, conflicts, wars. It’s also a safe bet unfortunately, that chaos looms, probably by mid-century, certainly by century-end. How bad the chaos will be depends in large part on how much and how quickly we can cut carbon emissions. Secondarily it depends on how soon we can develop and implement large scale carbon capture and storage technologies. If we act quickly and decisively, we can still avoid catastrophe. But if we don’t, the planet may well become uninhabitable. Our choice.
