Yergin Deftly Deconstructs the Energy Transition Narrative

“Governments simply cannot tolerate disruptions to, shortages of, or sharp price increases in energy supplies. Energy security and affordability are thus essential if governments want to make the transition acceptable to their constituencies. Otherwise, a political backlash against energy and climate policies will occur—what in Europe is known as “greenlash”—the impact of which is showing up in elections. Assuring that citizens have access to timely supplies of energy and electricity is essential for the well-being of populations. That means recognizing that oil and gas will play a larger role in the energy mix for a longer time than was anticipated a few years ago, which will require continuing new investment in both hydrocarbon supplies and infrastructure.” - Daniel Yergin, Vice-Chairman of S&P Global, writing in Foreign Affairs

Each year in advance of playing host to the annual CERAWeek conference held in Houston, Texas, Daniel Yergin, author of “The Prize,” “The Quest,” and “The New Map,” authors a written piece summarizing his views on the global energy situation. This year’s piece was published in Foreign Affairs, perhaps to accommodate its extraordinary 5,000-word length.

In the piece, headlined “The Troubled Energy Transition,” Yergin details a global energy transition that has fallen dramatically behind the pace needed to meet the vaunted “net-zero by 2050” goal, and says national and international leaders and elites must recalibrate to adopt more realistic targets for the future.

In a nod to the energy reality we have discussed here many times over the last three years, Yergin points out that, “what has been unfolding is not so much an ‘energy transition’ as an ‘energy addition,” a reality I’ve pointed to many times since 2021. “Rather than replacing conventional energy sources, the growth of renewables is coming on top of that of conventional sources,” Yergin adds.

Elections Matter

He also points out that the decision by U.S. voters to re-elect Donald Trump to the U.S. presidency means that, “priorities will focus again on conventional energy production and what his administration calls ‘energy dominance.’” That observation comes in the context of Yergin’s analysis that the rapidly rising costs of energy over the last half-decade are leading now to big changes in election results, and that election results in turn bring more changes to energy policies in democrat countries.