Winning the Carbon War
by SCA Solarize Intern Julie Settembrino
The first week of my internship with Sustainable Hudson Valley one of my supervisors, Melissa Everett introduced me to Jeremy Leggett’s book The Winning of the Carbon War and it shifted my world. I knew already that the fight against climate change comes in many forms, shapes and strengths; every facet of the way we live is a component to this global challenge threatening our survival. The Winning of the Carbon War casts that fight as a sharply focused “Civil War” playing out in the energy economy and policies of many nations. It taught me that the solution isn’t always hard to find, but rather is suppressed by those who benefit from the problem.
The focus of the book is on the political and economic battle for the future of the energy industry worldwide. Jeremy Leggett, a former oil geologist who is now one of the top executives for Solarcentury, narrates the book with invigorating passion and eye-opening truths. Throughout the book he emphasizes that the key to the future of a system powered off renewable energy, is a synergistic blend of all clean energy we have developed. The technology is here, and the price is dropping. The only thing stopping a revolutionary shift in the energy industry is the entrenchment of the fossil fuel industry within a market that lacks confidence in the possibilities of new technology.
Leggett chronicles a dramatic shift in these power relations over the year that includes the Paris agreements, showing how the changing economics and politics of the energy industry are connected to thousands of policy efforts, investor choices, street demonstrations, media articles, and other small steps – like the ones we take every day. And he focuses on critical leverage points that will shape the next stages of the war.
THE CARBON BUBBLE
First, there is the what people refer to as the carbon bubble. (This is all of the oil that is still under the ground, yet is still considered viable assets for oil companies.) To have a good chance of staying below two degrees, the IEA says, 60 to 80% of coal will need to stay in the ground. With upcoming climate change policy, and drilling restrictions, much of the oil underground will never be able to be used, creating stranded assets and causing a complete overestimate of the a company’s worth. In the words of Evans Pritchard, “The props beneath the global oil industry are slowly decaying”.
THE LOCUS OF CONTROL
The second point is control. The fossil fuel industry has the capability of manipulating their investors, who in many cases can be extremely influential people. From those within the media who ignore some of the most astonishing climate change data, to policy makers themselves, investors across the world are swayed in order to create a push in favor of the fossil fuel industries. In 2005, drillers succeeded in exempting the fracking process from the rules of the US Clean Drinking Water Act: an act of regulatory piracy that became known as the “Halliburton Loophole.” Today, the locus of control has shifted with the Paris agreements, US Clean Power Plan and policies of more and more countries.
TIME VS TECHNOLOGY
The third leverage point is the worldwide energy market itself. In 2012 the chief economist of the International Energy Agency warned that the world had only ten years to turn round its energy policy. They also warned that OPEC might not even have enough oil to provide the projected amount needed, and that even if they did they would need serious investment support in order to be able to extract it and get it to where it need to be. The International Energy Agency projects output falling from 69 million barrels per day (bpd) today to just 28 million bpd in 2035. And oil industries are having to spend more and more to keep their profits up. Between the growing complication and expense of extraction, oil prices are rising, just as renewable prices are dropping. Leggett makes the comparison “The big traded energy companies resemble the telecom giants of the late 1990s, heavily leveraged to a business model already threatened by fast-moving technology.” In other words, oil is a ticking time bomb and renewables are stepping up, fast.
Leggett’s chronicle shows how entrenched power is being shaken up, in large part because mind-sets are changing as the possibility of a renewably-based energy system starts to look real. We are a world built on fossil fuels; our economy, our investments, our political system, our means of production and transportation. The fundamental fight is not against powerful institutions or policies – it’s against the way things have always been. As a worldwide society of investors, engineers, consumers, travelers, dreamers, we can all step up to protect our future systematically, by making clear the risks of business as usual and the opportunity of a low-carbon economy opening up before us.