World leaders are shifting their stance on the importance of natural gas, and policymakers’ change has never been clearer than at this week’s Climate Week conversations in New York City. [emphasis, links added]
Multilateral organizations have been among the last to reconsider their stance on natural gas.
But as Semafor reports:
“Anna Bjerde, managing director of operations at the World Bank, told a small group of reporters that the lender is agnostic about which technologies it helps finance to improve access to electricity around Africa.
“The main focus of that work has been on solar, she said, but ‘gas has to be discussed and pursued’ for providing baseload power. ‘We should be leaning in to help countries develop gas.’” (emphasis added)
The new comments from the World Bank, which stopped financing new upstream oil and gas projects in 2019, come on the heels of a new report from the International Energy Agency (IEA) discussing the importance of continued investment in oil and gas:
“If all capital investment in existing sources of oil and gas production were to cease immediately, global oil production would fall by 8 percent per year on average over the next decade, or around 5.5 million barrels per day (mb/d) each year. This is equivalent to losing more than the annual output of Brazil and Norway each year.
Natural gas production would fall by an average of 9 percent, or 270 bcm, each year, equivalent to total natural gas production from the whole of Africa today.” (emphasis added)
Bjerde has not been the only global leader extolling the benefits of natural gas.
At Climate Week, Mozambique President Daniel Chapo said that “he is working to expand the country’s large hydroelectric dam while also pursuing gas production deals with Western drilling companies, and hopes to use more of that gas for domestic power plants,” according to Semafor.
Likewise, the European Commission’s director-general for energy, Ditte Juul Jørgensen, told audiences:
“The energy transition will continue to be our path, but we will need gas for many years to come.” (emphasis added)
The American delegation to Climate Week NYC continued to remind audiences of the importance of US natural gas supply, particularly as European countries look to exit Russian natural gas and the White House pushes for an accelerated timeline.
In an interview with Axios, Jarrod Agen, executive director of the White House National Energy Dominance Council, said:
“It’s Europe, it’s Asia. They are looking for U.S. energy. They want to get off of Russian energy sources, and we have such a supply.”
Tone-Deaf Theatrics Outside Of Climate Week Meetings
These comments are in stark contrast to activists’ theatrics in the streets of New York.
Protestors gathered in mass ahead of Climate Week, while Greenpeace USA activists deployed a 160-foot-long “Climate Polluters Bill” demanding a new “polluter tax” on the global profits of oil and natural gas corporations.
The activists parroted a familiar “polluters pay” message, which has become a catchall tagline used to promote climate lawsuits and climate superfund legislation – both of which New York has tried.
Over the last decade, New York (city and state) collectively filed three separate climate lawsuits and lost each case in court.
More recently, the state passed a “climate superfund” law to fine energy companies for their historical greenhouse gas emissions. That law is currently being challenged by a litany of groups ranging from the U.S. Department of Justice to neighboring state attorneys general.
At the same time, New York residents are paying an increasing amount on their utility bills to support the state’s commitments to renewable energy and electrification.
The Department of Public Service recently released its report on the costs of New York’s landmark 2019 Climate Law.
From Politico’s EnergyWire:
“By 2029, climate law costs would rise to 12.6 percent of the average residential National Grid electric customer’s monthly bill. At the same time, the total utility bill would increase from about $109 per month in 2024 to $159 per month in 2029.”
The Brick Wall of Reality
The reality is that natural gas and fossil fuels are needed to keep the lights on for families, lift millions out of energy poverty, and support economic growth around the world.
Take, for example, the global race for AI, which depends greatly on natural gas to meet the computing and data energy needs.
Energy Regulatory Commission former chair Neil Chatterjee highlighted this point when speaking with Axios at Climate Week:
“For the political left, there has to be a recognition that in order to win the AI race and keep energy affordable and reliable, we cannot do it without fossil fuels.” (emphasis added)
Even California Governor Gavin Newsom has recently dealt with the reality that fossil fuels are here to stay.
After years of fighting with and proudly running the oil and gas industry out of the state, Newsom has shifted his tone and pivoted to policies that attempt to keep the state’s few refineries running – a welcome change from his self-given title of the energy industry’s greatest “foe.”
If European energy leaders, the World Bank, and even the State of California are coming to terms with the necessity of natural gas, there’s no reason why New York business and consumers should continue bending the knee to radical activists.
Bottom Line: After years of speculative forecasts and pie-in-the-sky climate ambitions that vilified the oil and natural gas industry, the tides have turned.
International organizations, financial institutions, and world and political leaders alike are now recognizing the need and vital role a robust energy industry plays in the world economy.
Images of Climate Week NYC via AP/YouTube screencaps
Read more at EID Climate
This is a great piece, Nicole. Finally, the worm and worms are turning.