As mentioned in My recent post from July 20There are data points that are slowly accumulating about the lack of progress toward a so-called “green” economy. It has long been clear to those who think about it that the energy transition to “net zero emissions” is a fantasy that will not happen. But the question remains about exactly how this mania will end. Will the net zero emissions fantasies of climate zealots continue at full speed until they hit a wall of physical reality (like blackouts)? Or will they instead gradually retreat as governments respond to voter pressure about cost and convenience, and as investors pull back when it becomes clear that the projects cannot be financially successful?
A July 30 article by John Miltimore of the American Institute for Economic Research advocates the second option. The headline is “Why the ‘Green Economy’ Is Suddenly in Decline—in the EU, the US, and Wall Street.”Meanwhile, New York, at least for now, remains determined to move toward a full-blown crisis.
Miltimore’s paper draws on data from a number of sources — notably recent EU elections, changes in EU regulation, and the actions of major US investors. The most important item in the paper concerns the withdrawal of some of the largest US fund managers from so-called Climate Action 100+. Climate Action 100+ describes itself as “an investor-led initiative to ensure the world’s largest greenhouse gas emitters take appropriate action on climate change to reduce financial risk and maximise long-term asset value.” But it seems that in recent months, some of the biggest investors have decided to change their strategy. JP Morgan Chase and State Street have “all money withdrawn” from Climate Action 100+ pledge, while their larger peer Black Rock “reduce holdings and narrow relationships with the group.” Miltimore quotes a New York Times article from February Quantify different withdrawals: “Taken together, these moves represent a nearly $14 trillion capital withdrawal from an institution that was designed to leverage the power of Wall Street to advance the climate agenda.” $14 trillion is a big number for anyone.
On the European front, Miltimore points to the results of the EU parliamentary elections in June, along with the many rounds of deregulation that preceded and followed them. He (fairly) describes the parliamentary election results as a “green diatribe” against many Green parties, and notes in particular the disastrous results for the German Greens: “In Germany, the core country of the European green movement, support for the Green Party has plummeted from 20.5 percent in 2019 to 12 percent.” He then compiles a list of various climate-related regulatory initiatives that have stalled or been abandoned in the EU, including: new restrictions on the use of pesticides; a proposed ban on PFAS (per- and polyfluoroalkyl substances); restrictions on new industrial emissions (which were eventually eased for industry and adjusted to exclude livestock farms entirely); and a new deforestation law. Meanwhile, efforts in many countries to ban combustion vehicles, limit pool heating, and require electric heating for homes have led to serious public opposition (if not repeal).
My comment is that much of Europe – especially the UK and Germany – has already passed the point where further significant emissions reductions can be achieved at reasonable cost. Further efforts to increase the share of “renewables” in electricity generation will lead to rapid price increases. The reckoning can only be avoided by politicians rolling back current mandates.
New York still lags far behind Europe in actually implementing the energy transition fantasy. The Climate Leadership and Community Protection Act, which mandated the transition, was enacted in 2019, with the first major deadline (70% of electricity from “renewables”) set for 2030. In 2019, 2030 seemed a long way off. Now, in 2024, we are at a point where, to meet the deadline, most of the infrastructure needed to reach the “70 by 30” goal would have to be under construction; but almost none of it is under construction.
My July 26th post characteristic of one Report that I co-authored, warned New Yorkers not to switch to coal-fired power until politicians could demonstrate that they had a reliable plan to provide the necessary electricity. Even as my co-authors and I were writing that Report, our Public Service Commission was compiling its own Report (Biennial Review of the Clean Energy Standard) (Section 30 of This PSC profile). This is Summary from PBS. Key quote:
New York is expected to ramp up its renewable energy production in the coming years, but it is unlikely to meet a key climate goal, according to an official assessment released last week. The state’s climate law, passed in 2019, requires New York to get 70% of its electricity from renewable sources like wind and solar by 2030, which would significantly reduce the state’s greenhouse gas emissions. But New York is likely to generate only enough renewable energy to meet about 45% of its electricity needs by the end of the decade, well below its commitment, according to the assessment by the state’s Department of Public Service and energy agency.
Even the 45% figure quoted there is a fantasy, and largely includes a power plant at Niagara Falls that existed before all this energy transition sleight of hand. So far, all our politicians are in denial. The only small concession to reality is some talk of maybe pushing the 2030 deadline back a few years, say to 2033. The reality is that they will be no closer to the 70% target in 2033 than they were in 2030, and in fact that target will never be met because (as pointed out in my Report) they need “dispatchable zero-emissions resources” that don’t exist and won’t exist.
So, for now at least, New York is racing forward trying to slam into the actual wall at full speed.
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