Ukraine, energy and Net Zero
What the war in Ukraine means for European climate change goals
The situation in Ukraine prompts so many changing circumstances in such short periods of time, so many of them interlocking, that the challenge is less finding a subject to write about than to collect thoughts in a way that is useful and focussed.
For fear of getting diverted, I shan’t for now write even in summary a handful of other things that are currently pressing (apart from the obvious and most critical one concerning the abhorrence of war, and the secondary one - a point of great concern to me - that Ukrainian resistance is so valorised while similar Palestinian resistance has been vilified across seven decades, to the point at which many now feel comfortable misrepresenting the underlying issue - resisting military occupation - as substantively different).
Amidst all the negativity and complexity that feels harder and more precarious to pick through, I wanted to write about an element of the crisis and combined energy crisis that feels relatively straightforward and relatively positive; the impact of events in Ukraine on the green transition, Net Zero targets for a zero-carbon economy, and the broader transition away from fossil fuels.
Net Zero
First off and there is no doubt at all that the Russian attack on Ukraine is accelerating the green transition, at least in Europe (more on that later). From a renewable energy standpoint the response has been sizeable increases in the share prices of the wind energy majors, nascent hydrogen economy, and renewable energy trusts.
The idea of Net-Zero - an economy that is carbon neutral, balanced, and does not produce carbon emissions - is not without its complexity or smoke-and-mirrors. Carbon neutral offerings are inherently limited because they can create an over-reliance on offsets such as tree-planting programmes, sustainable operations selling their carbon offsets to polluting ones (leaving no underlying decrease in emissions), or inherent polluters such as oil companies claiming carbon neutrality because they start using solar power to get the oil out of the ground.
Nonetheless, sometimes it is useful to judge a thing partially on the reaction to it of those that you are generally in opposition with, and it is noticeable that online (and probably offline) right-wing culture (often mislabelled ‘libertarian’) generally despises Net Zero. “Green is Dead” one prominent US twitter account professed gleefully of the EU energy roadmap, and the announcement that climate policy would temporarily have to share priority with energy security. BlackRock, the frankly enormous investment house, have for a while been talking about the merits of the green transition and Net Zero policies, to the point at which the oil-heavy state of Texas threatened a boycott of BlackRock pension funds, leading to a more recent BlackRock backtrack.
This should be seen as an indicator for three things: 1. the fact that - for it to anger people (arguably the right people) so considerably - Net Zero must be doing something right; 2. for all the fine noises, the likes of BlackRock are clearly not committed deeply to Net Zero; and 3. again relative to Palestine, specifically the Boycott Divest Sanction (BDS) campaign against Israeli apartheid, there is a clear and undemocratic double-standard at play in who is afforded the privilege of using the political-economic tool of a boycott (more on this later).
For all that the journey to Net Zero was always going to be a long and fraught one, and for all that the outbreak of a war in Ukraine is only going to make everything bumpier, green is most certainly not dead, as attested by immediate UK announcements on more renewable energy investment - from previously shelved tidal projects to more wind capacity - or EU head Ursula von der Leyen talking-up the impossibility of continuing to import Russian fossil fuels when that country behaves so aggressively on Europe’s border.
There is the probability of a use of short-term dirtier power as energy demand rushes towards whatever is available other than Russian gas, but given that the pace of the previous, market-based approach to the green transition was already far too slow, you could argue that the systemic shock of the energy crisis, even with some short term pollution, will prove more effective than the steadily failing incrementalism that prevailed eight weeks ago.
Signals & Directions
The same quarter of particularly US but also British politics that provide the previously mentioned glee at the supposed death of green energy, also tend to exhibit a triumphalist and decidedly male bravado at the existence of high oil prices. To them, it is as if the high price of this polluting and often immiserating commodity is testament to not only its inherent worth (debatable), but also some sort of merit. Leaving them free to their opinions, it is worth stating that the high price of a barrel of oil (or a therm of gas) gives an implicit and directly equivalent value to alternatives to that barrel of oil or therm of gas. Nor is this 1973 with only an infant renewables industry; renewable technologies are increasingly deployed at vast scale and there are solid plans for them to run entire energy networks within the coming years.
The credibility of the renewables proposition can be judged too by the hostility - and the credibility of that hostility - it elicits. Amidst the weirdest rationales for the Ukraine war from right-wing, Republican USA is that it’s a result of the Biden administration’s “green agenda”. Not least because Joe Biden has pursued no such agenda, and delivered on few green infrastructure promises, it’s hard to understand the logic of this argument still less justify searching for it. The idea, one supposes, would be that an unassailable green push from the US (that isn’t happening) prompted Putin to invade Ukraine to stave-off the risk to a fossil-fuel future (by actually accelerating towards it). Who knows, but the clutching at straws does indicate the extent to which, longer-term, the fossil fuel lobby is running out of credible arguments and so has to resort to ludicrous ones.
One thing that is worth unpacking, however, is the extent to which the wider Net-Zero agenda has contributed to currently very high energy prices. While some of this is frequently overstated (the wind didn’t blow enough in summer 2021, or variable energy sources like solar and wind require fossil fuel backup), there is also a truth to it.
That truth, principally, is that the Net Zero agenda and its emphasis on green energy and the electrification of everything has - in conjunction with low energy prices forged this last ten years primarily by the introduction of US shale and wider global gas supplies - disincentivised investment in bringing on more oil and gas supply. The price has been too low to justify expensive explorations, the future too uncertain.
This is where it becomes useful to separate the signal from the direction. Years of intensive signalling of a direction of travel away from fossil fuels has stymied investment in new supply, so that we are now successfully on a direction of travel away from fossil fuels. The current statements from the likes of the EU about an energy security that in the short-term includes fossil fuels, or the Biden administrations intense efforts to have OPEC produce more oil to get prices down, are certainly early signals in a direction of travel back to fossil fuels - but they are only signals, and the world energy economy is very much an oil tanker; it turns slowly.
It is vital at this stage that climate advocates stick to their guns and reenforce the considerably superiority implicit in both Net Zero and renewable energy.
For those on the political right of the energy spectrum, arguing that producing non-Russian oil and gas is the way to defeat Putin - forget about it.
The underlying reason for this is the inherent fungibility of oil. A barrel of oil or therm of gas out of the ground in New Mexico fundamentally affirms the value of the same barrel of oil or therm coming out of the ground in Eastern Siberia. It would be wrongheaded to treat Net Zero as a purely geostrategic exercise against Russian hydrocarbons, but if you were theoretically trying to make the value of the whole Russian lot go to zero, the only answer is the paradigm shift to renewables, not the near-impossible task of isolating from markets (or replacing) the supplies of a single country.
Democracy & Climate
This brings me towards a point I often make with climate people, on a subject that has left me feeling increasingly distant and disenchanted from the entire movement.
On a basic level I have a moral objection to the ability of the Western climate movement’s tendency to implore change on behalf of tomorrow’s Westerners, while having little interest in change on behalf of today’s non-Westerners, many of whom arguably need it more radically. It is my opinion that this failure to practice true and deep solidarity, quite apart from morality, also weakens the climate movement. It is my opinion that the failure to engage with fundamental democratic issues such as speech, protest, boycott or even power, on the subject of issues like Palestine, helps erode the sacrosanct nature of these rights in ways that eventually - as in the BlackRock boycott case - end up weakening those tools to the detriment of the climate movement.
Particularly concerning Palestine, which is by some margin the gravest injustice currently occurring in the Western orbit of influence, it pains me that - even removed of its moral component - the climate movement shows such little interest in an issue that is essentially the key also to democratisation in the Middle East, and therefore democratisation in the heart of the world’s energy economy. I often refer to the progress that would be made if dealing with Saudi Aramco on climate issues were more like dealing with Equinor. This is fundamentally an issue of democracy - not climate - and yet few in the climate movement give any time to such thoughts, and often treat them as if peripheral to the very important business they are getting on with.
The bigger issue here is not only that the climate movement badly needs to make these democratic inroads, it simply cannot achieve its overarching goals without making them. While wind and solar energy show every potential of lowering the price of energy further still, the reduction is not indefinite. A former Orsted manager recently lamented the nobody in offshore wind is making any money anymore, part of the relentless drive to reduce costs above all else. This in itself (at the expense of emphasising the social or even ecological good of renewables) could be regarded a sort of democratic failing, as it has left the case for renewables to be made as a bland cost-reduction argument that eventually reduces almost as much as it can go, while making no further case for its value.
More than this, however, is the problem that as electrification and renewables increase as dramatically as they are going to, demand for fossil fuels will drop. This in turn, however, will reduce the price of fossil fuels in such a way that will help them to remain competitive unless states are making the qualitative, democratic decision to actively phase them out.
In Europe at least, with limited fossil fuel resources to meet its energy demands, and having already positioned itself well in the growing green economy, the question - from UK to Turkey with the EU in between - is a no-brainer that Ukraine and the energy crisis has made all the more clear. Europe has little to lose and all to gain from the green shift. A similar cost:benefit is true for China, but the exact opposite is true of Australia, the OPEC countries, and perhaps worst of all the United States, where many states have no inclination to stop fossil fuel extraction and the federal government will have no means to stop them.
I think often of an example from Puerto Rico, the US colony in the Atlantic, where Hurricane Maria knocked-out the island’s antiquated, expensive and polluting power station, a grid that - when rebuilt - was crying out on that sunny island to be turned over to solar energy, which would have been cheaper, cleaner and - because it would have been distributed rather than centralised - it would have been less vulnerable to the next massive storm. Still, Puerto Rico is a colony and not a democracy, so it got a new and polluting gas power station, not least of all because massive infrastructure projects - however needless - are always a great friend to corruption. This outcome was obviously climate-negative, but the means of preventing it had almost nothing to do with either the climate or even technology, but everything to do with a democracy that was absent.
As the situation in Ukraine reenforces the case for a renewable and energy-autonomous Europe, it’s probably safe to ignore the doomsayers about Net Zero within the continent. Outside of Europe, and a few other isolated countries is another and altogether harder question, but one that was always going to be the full extent of the political challenge.