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This reasoning is closely linked to the decisions of COP-21 taken at Paris (“The great climate change boondoggle”, Standpoint January/February 2016.) The principal ambition enshrined in the agreement was “to hold the increase in the global average temperature to well below 2°C above pre-industrial levels and to pursue efforts to limit the temperature increase to 1.5°C above pre-industrial levels, recognising that this would significantly reduce the risks and impacts of climate change.”

In their public pronouncements, environmentalists assume as a matter of course that the Paris targets can and will be met. For them it is a matter of morality, for sure, but also, because 186 nations signed up to the agreement, a matter above all of cast iron policy. The world has said it will do it, and therefore it shall be done, whatever inconvenient truths there may be about global economic growth and concomitant increases in energy demand. They speak in terms of carbon budgets as if there is a sort of global green treasury which will order a halt to energy-related carbon dioxide emissions.

One need not be unduly cynical to see that the Paris targets won’t be met by posturing, transnational dirigisme and (let us not forget) the called-for $100-billion-a-year wealth transfers from North to South. But action taken by sovereign nations, companies and individual consumers is already changing the balance between carbon-neutral and carboniferous energy sources. In 2017, for instance, renewables accounted for 40 per cent of new generating plant installed around the world. As the noted analyst Kingsmill Bond of TS Lombard has said: “If you believe in marginal economics, then you had better wake up to the fact that renewables are now the marginal source in power generation.”

It is a fact little acknowledged by the green commentariat, obsessed as they are by President Trump’s decision to withdraw from the Paris agreement, that the United States has seen the largest reduction in CO2 emissions in recent years. This is partly due to the encouragement of renewables at state rather than federal level: in 2017, for instance, the oil state of Texas generated 18 per cent of its electricity from wind and solar. It was greatly helped by its huge indigenous natural gas supply, which was always on hand to balance intermittent renewable production. And that points to the decisive factor in US CO2 abatement: cheap and abundant shale gas has largely replaced coal in thermal power generation. Gas emits less than half as much CO2 as coal.

Coal is the fossil fuel most vulnerable to the transition to renewables over the coming decades. But coal is cheap and abundant, and in many countries its role as a major employer gives it political clout. While China is expected to replace much of its coal capacity with gas and renewables, India — which despite signing the Paris agreement insists that the burden of reducing emissions must fall on the old industrial nations — will expand its coal-fired power stations enormously.

Recent experience in the coal industry shows that attempts to write it off have had unexpected effects, which may foreshadow what will happen in the oil industry in future decades. Big coal producers had scaled back their investment in new mines for “prudential reasons” related to the reduction in coal demand in the US and Europe. But Asian demand has continued to rise, causing the market price to double in less than two years. The prime beneficiaries of the environmentalists’’ war on coal have been the shareholders in mining companies.
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June 29th, 2018
11:06 AM
Excellent informed points. Energy does not equal tobacco. It is essential to life and to modern life. Mr. Rockefeller would agree to divesting only after his billions were safe and secure. That is in fact the background of the decision of his pious descendants

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