“LINGO!” It stands for “leave it in the ground,” and it is a rallying cry for those who believe renewable energy should replace fossil fuels. But anyone reading a new report from a highly respected group of renewable-energy advocates can only conclude that gas and oil are critical to our well-being and comfortable way of life—and will be for some time.
The case is made in the Renewables 2016 Global Status Report, published this month by the Renewable Energy Policy Network for the 21st Century (REN21). In an interesting coincidence, REN21 has published the report just as one of the world’s fossil fuel giants, BP, has issued its latest Statistical Review of World Energy—which strongly bolsters the same view.
The data in the BP report shows that while global deployment of renewable energy is at a record high, consumer use of oil is likewise at a peak. Taken together, the two reports show that while renewables are certainly getting started finding their footing, the world will have to produce and use fossil fuels to sustain our current well-being for years to come.
To be sure, the Renewables 2016 Global Status Report tells an upbeat story for renewables boosters. REN21, an advocacy group for renewable energy, says 2015 was a banner year for renewables—about 147 gigawatts of renewable power was added to global power grids, the biggest increase ever. Renewable heat capacity rose by about 38 gigawatts-thermal, and global power sector capacity reached 1,849 gigawatts, up 8.7% over 2014.
REN21 boasts that, “Renewables are now established around the world as mainstream sources of energy.” Deep in the report, however, is the nugget that modern renewables (excluding hydro and nuclear power) such as wind, solar, biomass and geothermal power combined still make up only 1.4% of global energy consumption, up from 1.2% in 2012.
Meanwhile, The Drillers Say…
At the same time, BP’s latest Statistical Review of World Energy says worldwide consumption of fossil fuels for everyday consumer needs has never been higher. Oil consumption reached record levels in 2015, spurred by low oil prices, says BP’s Group Chief Economist Spencer Dale. “Global oil demand is estimated to have grown strongly last year: up 1.9 million barrels per day, nearly twice its 10-year average…The strength in oil demand was most pronounced in the consumer-focused fuels, particularly gasoline and jet fuel.”
Oil wasn’t the only fossil fuel enjoying a great 2015. Natural gas production also grew strongly, driven by robust demand and consumption from the power sector that keeps our lights on, hospitals open and running, water treatment and other pollution control equipment working, factories churning and our air conditioners humming.
Unsurprisingly, coal had a terrible year, with global consumption down 1.8%. Helped by this shift in the energy mix away from coal toward cleaner burning natural gas and, in some part, the increase in renewables, growth in carbon emissions from energy consumption grew at just 0.1% in 2015 even as the global economy grew. (Good news: That’s a big improvement from the past decade when growth of carbon emissions has averaged over 1.5% annually.)
The takeaway from all this is that while the growth of renewables is impressive, it’s not reasonable, or even safe, to abandon fossil fuels now as LINGO advocates suggest. Even under the best scenario for renewables, it would take decades to remove fossil fuel from the energy mix without doing grave harm to our lives.
An immutable lesson from history is that it takes time for new forms of energy to reach a tipping point in the global market for energy consumption. It took oil 40 years to grow from being a 1% source of world energy in 1877 to fulfilling 10% of global energy needs, says BP’s Dale. The slow shift in energy-use trends makes sense when you consider that when we buy a car, it stays on the road for about 20 years. And when a utility builds a power plant, it is expected to run for at least 40 years.
“The simple message from history is that it takes a long time—numbering several decades—for new energies to gain a substantial foothold within global energy,” says Dale, forecasting that even with a faster penetration than any other fuel source in modern history, renewable power will barely crack 8% penetration 20 years from now.
Germany’s Green Mess
Anyone wondering what an economy that would try to quit fossil fuels cold turkey would look like can observe Germany. Europe’s leading economy suddenly quit nuclear power, and it will have to find new ways to fulfill 22% of its energy needs by the time its last reactors are shuttered in 2022. The result there has been misery for the German people and a political and economic disaster.
Germany’s Energiewende—the energy transition aimed at making Europe’s biggest industrial economy run largely on renewable energy—has been in place since the 1970s. But more recently, Chancellor Angela Merkel abandoned nuclear power—a rash political move, far removed from science or reason. As Reuters put it, “The decision, one of the biggest policy turnarounds in Germany's history, lays bare a lack of coordination untypical for Merkel, a physicist by training and known for her disciplined step-by-step approach.”
The result has been skyrocketing energy costs and chaos. Consider that Americans pay on average around 12 cents per kilowatt-hour of electricity. Germans easily pay twice as much. German industrial stalwarts like BMW, Wacker Chemical and BASF have increased investments outside of Germany as a result of high energy costs. The head of the German Chambers of Commerce and Industry says the industrial nation is sandwiched between cheap labor costs in Eastern Europe and cheap energy prices in the United States.
The Economist says of German energy policy, “Businessmen say the Energiewende will kill German industry. Power experts worry about blackouts. Voters are furious about ever higher fuel bills. The chaos undermines Germany’s claim to efficiency, threatens its vaunted competitiveness and unnecessarily burdens households.”
Since Germany only produces about one quarter of its energy needs at home, it is in the unenviable position of being overly reliant on Russian natural gas, even though it has, by some estimates, recoverable domestic shale-gas reserves of 230 billion cubic meters.
Facts are stubborn things, and a close reading of the REN21 and BP reports and an understanding of the lessons of Germany’s experience teach us that the shrill rhetoric of LINGO needs to be given pushback by people who want to be reasonable.
All of this is a warning to the average American and our elected officials in Washington who buy into “LINGO." Even if you’re a fan of renewables who takes the challenge of global warming seriously, the responsible answer should paraphrase St. Augustine’s prayer for chastity: “Grant me all renewables, but not yet.”
