Rhetoric at the World Economic Forum (WEF) in Davos, Switzerland, dominated the energy news last week. Some world leaders seem to believe that constantly refining the language they use about climate change and the energy transition is the only way to keep the public’s attention.
Rising rhetoric to match global temperatures
This could explain the approach of UN Secretary-General Antonio Guterres, who declared at the COP 27 conference in Egypt last November that the world was “on the highway to hell”. In Davos, Mr Guterres followed this rhetorical flourish with a blast at fossil fuel producers who had ushered the world into what he called , saying: “Today fossil fuel producers and their intermediaries are still racing to expand production, knowing full well that their business model is in at odds with the survival of humanity,” Guterres said. “This madness belongs in science fiction, but we know that ecosystem collapse is cold, hard scientific fact.”
During a later interview, told Maria Bartiromo of Fox Business that “We are staring into the eye of a Category 5 hurricane. Our world is being battered by a perfect storm on a number of fronts,” Guterres said. “The outlook, as we all know, is grim.
US climate envoy John Kerry said he and others traveling on private jets to the conference were a “select group of human beings” on a mission to literally “save the planet”. He added that the experience of all these select people meeting in Davos is “almost otherworldly”.
But if the select group of the WEF has been saving the planet at its annual meetings in Davos, former US Vice President Al Gore has yet to see any evidence of results. Mr. Gore made news when he exclaimed during a panel discussion that despite all the efforts of governments to subsidize a rapid energy transition, the world still emits 162 million tons of greenhouse gases into the atmosphere in a single day, which he says is the equivalent of detonating “600,000 Hiroshima-class atomic bombs.”
He wasn’t done. “It’s what boils the oceans, creates these atmospheric rivers and rain bombs, sucks moisture from the earth, creates droughts, melts ice and raises sea levels and causes these waves of climate refugees!” he added.
If hyperbolic rhetoric could solve climate change and force an energy transition to renewables and electric vehicles, Mr. Gore probably would have solved the matter long ago.
There were also quieter voices
But other conference participants were more measured in their remarks, taking the opportunity to present various proposed solutions and plans. As I noted in an earlier article, European Commission President Ursula Von Der Leyen promised that the EC would consider a central industrial plan for her continent, which would include a set of new clean energy incentives and subsidies that would rival US subsidies contained in last year’s deflationary law.
“The aim will be to focus investment on strategic projects throughout the supply chain,” von der Leyen told WEF attendees, adding: “In particular, we will look at how to simplify and speed up the permitting of new clean technology manufacturing plants.” If she succeeds in the authorization goal, Von Der Leyen would put Europe one step ahead of the United States Congress, which has twice tried and failed to pass a bill with similar goals sponsored by West Virginia Democratic Senator Joe Manchin.
With oil and gas company executives back on the invite list, despite Mr Guterres comparing them to former tobacco company executives, Aramco CEO Amin Nasser spoke about his country’s efforts to boost its own oil supply to meet continued global demand. growth even as renewables expand.
“We’re adding capacity,” Nasser said during his interview with CNBC’s Hadley Gamble, adding that nearly an additional million barrels per day would come from replacing burning liquids for power generation with natural gas in 2030.
But Nasser added that his country cannot meet the growing demand alone. “This additional capacity will help,” he said, “but it will not alleviate the situation where demand is rising and offsetting the decline. You need more investment elsewhere globally to meet global demand.”
Oil is not the only energy mineral in short supply
But oil is far from the only energy mineral in limited supply as the transition progresses. Vice Chairman of S&P Global and author of “New mapDaniel Yergin spoke about the issues surrounding the growing demand for copper and other critical energy minerals during his own interview with Bartiromo.
When asked about the state of the energy transition, Yergin pointed to research he conducted for his book, during which he found that transitions “don’t happen overnight, and they don’t happen in a quarter of a century. They take longer,” he adds, “And there’s a lot of technology that’s not there yet.”
Yergin pointed to challenges that have already materialized as producers try to meet growing demand for critical minerals such as copper and lithium. “We’re going to have another issue that we’re going to talk about in the coming years, and that’s mineral access to things like copper and lithium,” he said. “And we’ll see the price, as you just saw, copper prices started to rise again after China opened up.
Yergin said the long lead times to start new mines — which he said could take as long as 15-25 years — will create tight supplies and higher costs for these critical minerals for the foreseeable future, adding, “I think you’re building in a different kind of inflation in infrastructure.”
More solutions, less hyperbole needed
Bottom line, if all it took was a flourish of rhetoric and hyperbole, the world would already have solved its climate change problem. But this WEF conference in Davos showed again that any real solutions are likely to come from the calmer heads of the executives and politicians who traveled there last week.