Column: Enthusiastic Idiocy vs. Infrastructure Optimization – Two Strategies for an Energy Transition

From BOE REPORT

 Terry Etam

Last week, buried in the flow of weird crap that fills the mailbox these days, was a small treat – the Lee Valley catalogue. It is a booklet of wonder, even if delivery apparently might take a year…not sure how I’m going to survive without the $80 “Discover Whittling Set” or the $135 Camera Lucida. 

Beyond those staples a German tool caught my eye – the Eierschalensollbruchstellenverursacher (wow did spell checker ever get mad at that). It is pretty much what it sounds like; a metal egg cup with a long rod sticking out the top with a weight on the rod that drops down and ‘drives the rim cleanly through the shell’ allowing users to access the yolk of soft-boiled eggs without shell shards. 

It warms one’s heart to see such a precise bit of engineering that so precisely and purposely solves an issue. Bless those Germans. 

I pondered this Germanic engineering precision when contemplating a car racing series called ElectricGT (born 2017, died 2018). The series’ idiotic flop made me think there couldn’t possibly have been a German engineer involved. (Although, Germany’s current energy policy is working about as well as WWII…the egg crackers and cars are exquisite but maybe the really macro stuff isn’t their strong suit.)

The tale of ElectricGT is worth dissecting, as it is a perfect metaphor for the utter failure that a too-rushed energy transition will create. In a hundred years of eierschalensollbruchstellenverursacher-ing, I couldn’t have come up with a better analogy.

Developing an international racing series is a formidable undertaking. It must be sanctioned by the world racing regulator, the same Fédération Internationale de l’Automobile that governs Formula 1. Multiple deep-pocketed sponsors are a must. Tracks must to be rented far in advance, and Formula 1 tracks do not presumably come cheap. Cars, teams, team crews, and drivers must be found, hired, and organized. Cars were purchased and modified with roll cages, etc. Some serious promotion ensued to get the world’s attention.

Organizers did all of that, and did it well. The professional website shows the whole sh*teree – a ten-race initial season. Races across Europe. Tracks booked. A five-year development plan. Each race a ‘weekend festival’ with a structured practice/race schedule: “Rounds will consist of a 20-minute practice session, 60-minute qualifying heat, a day race (60km) and a dusk race (60km).” The series was officially launched in Ibiza, Euro-party headquarters. All systems go!

But then, dead silence for four years. Not a peep, until a few weeks ago.

Some news about the series surfaced in an article on the website The Verge. The story wasn’t news, it was more like one of those “I’m finally ready to talk about it’  emotional belches people emit when enough time has passed. The story: The racer/writer reported how, in 2017, he had shown up in the south of France to film a promo video at the first race. Strapped into the seat, he headed out for the first practice session of the first race. The practice time had been reduced to ten minutes, but no matter. First lap impressions were that the car felt great – lots of grip thanks to the racing slicks, and it was fast.

Second lap impressions never materialized – the car packed it in before he could begin. The battery overheated at the end of Lap 1, the car went into half-power limp mode, and that was that – for the practice session, for the race, for the whole racing series. The car, despite all the external foliage of a race car, was not just ill-suited – it was an impossibility. Any one of the people involved could have taken the car to a track for 30 minutes to see what would happen. Not only did they not do that, they spent millions only to find out the dog didn’t hunt.

And there we have the perfect metaphor for the too-rushed energy transition that the flamboyantly elite ignoramuses at COP26 envisioned. When you look at that cast of attendees, the global who’s who of do as I say but not as I do, the not-yet-dead colonialists lecturing Africa/India/China to take emissions seriously from the steps of private jets, you might think that it is impossible that such a powerhouse dream-team of 30,000 globe-trotting superiors could get an energy transition so wrong, so completely.

That’s why the ElectricGT lesson is so valuable, because it shows the process of failure. Let your project be guided by a moral ‘imperative’ rather than the laws of reality, and that’s what you get. And it keeps happening, at a larger scale, because even COP26 global kingpins make the same mistake.

COP26 supremos pushed agendas onto developing nations, who pointed out that the metaphorical car would not work. India was asked to put forth a plan to stop using coal, and they said no thanks. China would not support it either, nor even would the US. Even the EU – the EU! – threw up their own roadblocks by refusing to place nuclear power in its green energy category (nuclear is the only zero-emission mid-term hope to dramatically reduce hydrocarbon consumption). In the ultimate irony, as the EU-led COP26 forum made progress on the elimination of fossil fuel subsidies, some EU member states were creating brand new fossil fuel subsidies (in the form of capped energy bills for citizens) to help their populations deal with hydrocarbon shortages/soaring prices.

It’s the exact same pattern – start with their vision, build grandiose plans, spend a fortune, then realize the whole thing (Europe’s insistence on renewables as a solution) doesn’t work. To underscore the point, global consumption of hydrocarbons, the fuel squarely in the crosshairs at COP26, is now being consumed at all-time high levels, with global consumption still growing. Hydrocarbons remain stuck firmly as source for about 80% of the world’s energy needs for decades now, despite a trillion or two thrown at renewables.

None of the above is to trash the idea of an energy transition, of course. One will happen. One is happening. What is key about the one that is happening though is that it is progressing because it is dovetailing with the existing hydrocarbon system, not trying to dance on its grave.

Here’s what transition success looks like. The other week, TC Energy announced a partnership with Hyzon Motors, a supplier of hydrogen fuel-cell vehicles. Under the partnership, the pair will “collaborate on development, construction, operation, and ownership of hydrogen production facilities (hubs) across North America.”

TC Energy will operate the hubs, supply power/gas, and provide asset development, management services, and power and gas sales marketing. Hyzon will get an enormous leg up on its plans for widespread adoption of its fuel-cell commercial vehicles. The venture will market hydrogen to other industrial customers, which will help establish a hydrogen network. 

Note the key distinction here between these concrete plans and the ephemeral wishlist of COP26 jetsetters. The Hyzon/TC Energy plan will utilize and leverage the existing hydrocarbon-based system – TC Energy’s vast network of pipelines and associated infrastructure. COP26 visions refuse to talk about hydrocarbons at all, other than to disparage them.

Every now and then, as quick green illusions get shattered, some commentators get snarky: Of course it won’t happen quickly, it’s a transition, everyone knows it will be hard. If such critics really understood that though, they would not be so quick to pile on to the anti-hydrocarbon movement, or to stand by silently and be complicit. There are indeed intelligent commentators that emphasize the need for a healthy hydrocarbon industry for upcoming decades, but they are few and far between – many are like the Pembina Institute, cloaking an anti-hydrocarbon bias in guise of endless studies of how rapidly the sector will disappear. And the unchallenged leaders of the mobs are crystal clear, such as George Monbiot in The Guardian: “What we needed at the Cop26 climate conference was a decision to burn no more fossil fuels after 2030…positive feedbacks will rapidly drive fossil fuels to extinction…The plummeting prices of solar electricity and offshore wind – already cheaper than hydrocarbons in many countries – are making fossil fuel plants look like a filthy extravagance.” Tell me again, dear noveau-energy-transitionists, how that unchallenged nonsense is constructive, and why it goes unchallenged by those who claim to want progress. 

The Hyzon/TC model will be the blueprint for the energy transition. It will succeed because it is a planned step-out of known equipment, processes, and technologies. The COP26 model will fail as spectacularly as ElectricGT, because it is built on a normative vision of ‘what ought to be’ that is untethered to reality.

The hydrocarbon sector must remain healthy to ensure the infrastructure remains healthy, as it is key to any successful transition. Hate-mongering and ‘divest fossil fuels’ campaigns are gradually decimating the industry, at least in Europe and NA. It is being starved of capital. Excess cash flow is being returned to shareholders. Fewer young people are willing to join the industry because who needs the hassle. 

(By the way, there is as of yet no energy transition at all – globally, the growth in renewable energy supply is lower than the rise in global energy demand. According to an analyst at Platts, the global supply of renewables will grow by 35 gigawatts from 2021 to 2022, but global power demand growth will increase by 100 gigawatts over the same period.)

The energy transition is going to be exciting, creative, profitable, and rewarding, because it is going to leverage all the skill and expertise (and product) of the hydrocarbon industry – the industry that works rather well at keeping 7.7 billion people alive. It can be helped by proper government support, in productive ways, as long as those governments know where to start. 

The COP26 model, the one built around a future temperature, is going nowhere, as was proven these past few weeks. Neither enthusiasm nor perceived need will, in fact, move mountains. Anyone that has any doubt about that, this winter’s looming energy shortage will provide all the proof anyone will need.

Quick! Distribute some copies while the thought police are all at COP26. Pick up “The End of Fossil Fuel Insanity” at Amazon.ca, Indigo.ca, or Amazon.com. Thanks for the support.29dk2902lhttps://boereport.com/29dk2902l.html

Read more insightful analysis from Terry Etam here, or email Terry here. PS: Dear email correspondents, the email flow is wonderful and welcome, however I am having trouble keeping up. In past I replied to everything but am getting stretched. Apologies if comments/questions go unanswered; they are not ignored.