The modern global economy runs on energy Contemporary geopolitics are shaped by energy. For instance, it is wondered whether the United States of America would have risked the lives of thousands of its troops and spent so much financial resource on rescuing Kuwait from the vice grip of the Iraqi president, Saddam Hussein if the little desert nation with a sparse population had not been full of petroleum. This speculation is important because when Saddam Hussein moved into Kuwait on 8 August 1989 and occupied it which caused pandemonium throughout the globe, Liberia was about to start a descent into anarchy.
Liberia is not just another country; it was an American colony created for freed African slaves. Its capital, Monrovia, is named for the fifth American president, James Monroe (1817-1825), widely remembered for the Monroe Doctrine that the American Hemisphere should be treated as the American backyard; the doctrine precludes outsiders from meddling in affairs around the United States. Yet, Washington ignored the chaos and anarchy in Liberia that started on December 24, 1989, when Charles Taylor led his National Patriotic Front of Liberia to launch a war from the Nimba County that shares border with Ivory Coast. Nigeria was compelled, as the Giant of Africa, to not only move its troops—army, navy, and air force—into Liberia but also spend a fortune on the country under the auspices of the Economic Community of West African States (ECOWAS). I understand that at the end of the war, Nigeria lost about 1,000 officers and soldiers, that is, a whole battalion, and also spent some eight billion dollars on the ECOMOG operations.
Now, let us move away from events of the 1990s and the wars. Let us reflect on international events of the last couple of years, concerning energy. The West, particularly Western Europe, has been mounting a relentless campaign for cleaner energy. It wants the world to embrace solar, wind, and other forms of renewable energy like hydropower. It has been asking mostly developing nations to abandon coal in particular, referring to it as the greatest environmental pollutant through carbon emission. It has even added natural gas to the list of fuels that should be banned to make the world limit global warming to 1.5 degrees Centigrade by 2030, as required by the Paris Accord on Climate Change of 2015.
Something dramatic was to happen in 2022. Following Russia’s invasion of Ukraine, European nations imposed a series of sanctions on Russia; Moscow, in return, took punitive actions against the West. Western countries like Germany which depended largely on gas imports from Russia began to feel the pinch. Germany, the largest European economy, decided to revive coal-fired plants that it had resolved, under Angela Merkel, to close down. Though there were no imminent threats of power shortages in Germany, Berlin chose to reverse its policy on coal plants rather than risk in any way the chance of its people suffering any form of electricity crisis.
Germany was not alone. The United Kingdom, which had prided itself on shutting down its coal-fired power plants and on building large windfarms, decided to resuscitate its coal plants. Why? It didn’t want its citizens to suffer the 2022 heatwave unduly.
A similar scenario emerged in France the same year. Faced with winter which could hurt its people, Paris chose to extend the lifespans of its coal-fired plants. Though electricity from coal was responsible for only 0.6% of national electricity production, the French government had to extend the lifespans of coal-fired plants just to protect its people. This is the country where 196 states, including Vatican City, signed the famous Paris Accord on Climate Change under the United Nations auspices!
The United States is proud that several of its coal-fired plants have been decommissioned. Coal used to account for 50% of America’s electricity, but the figure has now reduced to about 17.8% and it is expected that it may decline to 4% by 2030. Environmentalists are delighted at the rapid decline. But it would appear that the decline has not been driven by as much commitment to environmental protection as by economics, even though the Joe Biden administration has a special envoy on climate change. It is easier and cheaper to run a natural gas-fired plant than a coal-fired one, thanks to enhanced shale gas production and other issues. In fact, fossil fuels make up 60% of the total fuel to power since gas contributes more than 42% of fuel to power in America.
The Donald Trump administration used to celebrate the ubiquity of coal all over the United States; its affordability; the convenience of its storage and use; the ease of its transportation; its generous use by steel, aluminium, and cement manufacturers; its extensive use by railway firms; the millions of American workers who depended on it; its host communities; several American businesses that relied on it directly and indirectly; and its key role in America’s industrial history.
There is something that we should know from the Americans as they deactivate their coal plants: a great concern for the common good. The United States Department of Energy has been looking for ways to fill the gap created by the declining coal plants. It thinks that converting the coal plants to nuclear plants will result in additional $275m annually in economic activities in the host community. It wants the affected coal plants replaced by nuclear power plants. This is to ensure that the electricity workers retain their jobs, and the host communities remain economically active. There is the argument that re-purposing the plants from coal-fired to nuclear will reduce the cost of building brand new stations by 35%. A nuclear plant requires a fraction of the fuel needed by, say, a coal plant to produce the same amount of power. But its waste water is dangerous and the primary raw material used for nuclear energy is uranium, which is mined and, therefore, constitutes environmental degradation.
Of course, it is not only nations that have displayed self-interests in the dialogue over fossil fuels. Take the case of five Superstar oil and gas companies, Shell, Exxon Mobil, Total-Energies, Chevron, and British Petroleum. Well, Exxon-Mobil and Chevron did not claim to be as committed to cleaner energy as their European counterparts. Shell, under Ben van Beurden’s leadership, tried to sell itself as a leader in the vanguard of the campaign for clean energy and paid a price for it. While it was posting huge profits, its stock performance on the exchanges was flat, unlike those of Chevron and ExxonMobil. Investors were not sure whether Shell was an oil and gas firm or one dealing in renewables.
All this changed with the assumption of office of Wael Sawan, the Lebanese-Canadian, as its chief executive in January 2023. Sawan has left no one in doubt that his loyalty in not to environmentalists but to shareholders. Shell has resumed heavy investments in oil and gas. It has reduced its climate ambitions by scaling down its goal of reducing the net carbon intensity of its energy products from 20% to 15 % by 2030. Its investments in renewables came down from $3.5 billion in 2022 to $2.7 billion in 2023.
Shell is not alone. The other British superpower petroleum company, BP, has taken similar steps. Its investments in low-carbon energy are seven times less than its investments in fossil fuels while those of Shell are five times lower. TotalEnergies of France in April of 2023 announced a reduction of its climate ambitions from 35%-40% in emissions in 2030 to 20%-30% the same period.
The Shell CEO has an interesting explanation for the new ongoing huge investments in oil and gas by the petroleum majors: the world needs energy security. I believe he really meant the Western nations.
Renewable energy has been marketed as the silver bullet to climate change. Many are, therefore, under the impression that there are no environmental issues with electric vehicles, solar panels, solar batteries, windfarms, dams, etc. They are in error. Electric cars, for instance, are expensive. Tesla vehicle prices range from $40,240 to $47,240, though Elon Musk, rattled by cheaper EVs from China like those from BYD, is working on producing more affordable models. What is more, there are not enough Supercharger networks in the United States. To worsen matters, other electric cars could not recharge at Tesla’s facilities until recently.
Solar panels and batteries do not charge at night. This adds to the deficit of high costs, especially in poor nations. However, these deficiencies are hardly mentioned in the mainstream Western media. It is like a windfarm that works only when there is considerable wind, but this inadequacy is scarcely discussed.
A critical raw material used in the production of solar panels and batteries is lithium-ion. It is a mineral like coal or crude oil. It is mined. The process of extracting it is environmentally hazardous. But no-one talks about it.
In Chile where it is produced more than in any other country, nearby rivers have been polluted. Protests by the citizens against pollution have been met by brute force by security agents, violating the rights and dignity of the people. In the Democratic Republic of Congo (DRC), where cobalt, copper, and lithium-ion are produced massively, there are human rights abuses on an industrial scale. There is also child labour, in addition to other forms of labour exploitation. The beneficiaries are mostly Western multinationals.
The DRC Government towards the end of April 2024, hired the services of a team of French lawyers to write to Apple Corporation, the American technology giant, accusing it of benefitting from illegal actions in the eastern part of the country where lithium-ion, and copper used in the manufacture of electronic gadgets like smart phones and solar panels as well as batteries are mined. Rebels are active in this part of the DRC.
In New York State where the government plans to reduce greenhouse gas emissions by 40% by 2030 and by 85% by 2050 from the 1990 levels through solar and wind power, there have been protests against the conversion of farmlands to solar and wind farms. There have also been protests against the destruction of biodiversity and the habitat generally.
