The Real Reason Why Oil And Gas Is Here To Stay
Julianne Geiger, OilPrice.Com, December 21, 2021
- The real reason why global climate targets are doomed to fail has barely been touched on.
- The wealthiest 1% account for 15% of the world’s emissions–more than twice the emissions generated by people in the bottom 50%.
- When it comes to conserving energy and lowering carbon footprints, focusing on the UHNWIs will provide the most bang for the buck.
The rallying cry around global climate initiatives grew increasingly boisterous leading up to COP26 this year. The media posited what bold, new goals would be set. Others questioned the likelihood that those claims would be fulfilled. But the real reason why global climate targets–including those set at COP26–are doomed to fail has barely been touched on: cognitive dissonance and super consumers–and it’s why the oil and gas industry can likely rest easy.
In oversimplified non-psychiatry-speak terms, cognitive dissonance is when we feel some angst over the disconnect between how we wish to see ourselves versus how we really are. In order to ease the angst over this incongruity, we must give ourselves a fair dose of dishonesty.
Economics and Science
Sure, there are troubles with the economics and science of renewables (or green energy if you prefer, although the terms are not synonymous) that many have assumed would bring the world closer to our worthy emissions goals. Renewables are expensive, and in some cases, the science isn’t quite there. This category would include the minerals and metals mining required to support renewables–which, under no circumstances can be considered renewable (these are finite resources) and certainly not “green”. It would also include battery storage requirements, battery recycling, solar panel and wind turbine recycling, issues with diverting water for hydropower, and the pesky problem with handling nuclear waste. Those are all legitimate problems that may or may not have a solution in the future. But at least it’s possible that someday, those issues will be resolved.
But there are other issues–some might say bigger issues–that are only whispered about and discussed in unpopular circles by unpopular people–issues that will make the world’s climate goals seem like pie in the sky thinking, whatever the media headline of the day.
The Gluttonous 1%
Let’s start with a rather unpopular but absolutely factual issue that is a major obstacle in meeting climate targets. You can focus on how we’re producing energy, or you can focus on consuming energy. Focusing on the former is more palatable, if not scientifically complex and pricey. Focusing on energy consumption, on the other hand, is often met with immediate resistance–understandably so. Yet, it has a far simpler solution and is much less expensive. But it is a likely go-nowhere solution because if the world is truly to affect consumption, it must focus on a very specific group of individuals: the super consumer.
Who are the super consumers?
Analysts love to cite facts and figures about which country per capita is responsible for the greatest amount of oil and gas consumption–or energy consumption–or has the highest carbon footprint. Aside from the fact that those figures are routinely disputed, those analysts lose sight of a wildly different perspective: further drilling down into precisely who the heavy consumers are within those nations.
A UN report from last December shows exactly who those people are: they are the world’s wealthiest 10%, who the UN alleges make up 50% of the world’s carbon footprint. The wealthiest 1% account for 15% of the world’s emissions–more than twice the emissions generated by people in the bottom 50%.
Now, this isn’t to shame all those jet-setting super consumers and energy wasters. Nay, it is merely to point out the fallacy in thinking that the other 90% of the world’s population–representing a mere 50% of the world’s carbon footprint–has the ability to carry the world into our greener tomorrow.
Such thinking is popular yet foolish.
According to the UN, the global rich would have to cut their carbon footprint by 97% to stave off climate change. That the rich exact a higher carbon footprint on the world–or that income and the size of one’s carbon footprint is correlated–is not new. It is also not popular.
Setting carbon goals that focus on Average Joe instead of those super consumers is like trying to curb teen social media use by banning Twitter instead of Snapchat or TikTok.
And here’s an unsurprising factoid–those super consumers don’t live in Africa.
Most of the world’s wealthy–or rather, the ultra-high net worth individuals (UHNWIs)–are centralized in just a handful of places, overwhelmingly in North America and Europe, according to Knight Frank’s 2021 Wealth Report, making the sham of COP26 delegates squeezing lower-income countries who are just starting to master energy security courtesy of coal power rather hypocritical. And it’s particularly rich coming from big, voiced climate crisis purveyors whose annual private jet miles dwarfs many well-to-do people’s annual salaries.
For perspective, it’s important to point out here that a 17,000-pound Lear private jet gets about 4 mpg.
IEA Roadmap For the Commoner
That didn’t stop the IEA earlier this year from coming up with their roadmap to net-zero, for the commoner. This report is chocked full of all the quirky things “we” can all do to diminish our carbon footprint (like keep our homes at blah degrees, etc.). The only “rich” referred to in this report is in relation to countries.
Yet, when it comes to conserving energy and lowering carbon footprints, focusing on the UHNWIs will provide the most bang for the buck–and analysts know it.
Give Them What They Really Want–A Life of Excess
Of course, that is extremely unlikely to happen, and this is where that bit of cognitive dissonance comes in. In theory, we would all like to reduce our carbon footprint. We would like to meet climate targets and lower emissions. We are also enamored with the rich and famous. We love excess. And for all the GenZ protests and lawsuits targeting big oil and gas in climate champion Greta Thunberg’s name, there are many times more starstruck Kim Kardashian followers that just can get enough of the socialite’s planet-wrecking life of excess–from which the socialite seems immune from ridicule.
GenZers are infatuated with Tesla’s, though most have little desire to understand how Musk is mining for those metals or where those spent batteries will reside a decade from now. They are captivated with Greta’s passion for the climate, yet worship fashionistas, celebrities, and royalty at whom Greta would frown. It is here, in our own hearts and mind, where the climate battle will be waged, for the world will likely never push these super consumers to downgrade their carbon footprint to match those in third-world countries who rely on dirty coal. In time meantime, one will likely be continually frowned upon for failing to live up to the world’s climate agenda, while the other will get a pass.