Home / Oil & Energy / Oil & Companies News / Energy firms can’t all be better than average

Energy firms can’t all be better than average

The energy industry’s big Houston confab CERAWeek ends Friday. Perhaps it’s more accurate to say conferences, as oil, gas, and renewable power executives examined the same set of facts and expounded on why their own industry is better and more important than others. They can’t all be winners. The future of low cost points to renewables.

Amin Nasser, chief executive of the largest oil producer in the world, Saudi Aramco 2223.SE, kicked off Monday morning with what he called hard truths. Nasser said the clean energy transition is failing on most fronts, and we should abandon the fantasy of phasing out oil and gas, to spontaneous applause from his crowd. He protested oil’s contribution to global wealth was overlooked and said demand could grow through 2045.

Natural gas participants were equally bullish. Executives from EQT EQT.N, Freeport LNG and Williams Companies talked about how U.S. exports of the commodity could quadruple, and cut billions of tons of emissions by replacing coal from China. They pridefully pointed out that gas exports had saved Europe last winter, but were resentful that U.S. President Joe Biden had paused approvals on new projects to export LNG.

Green energy firms were even more upbeat. Companies from car charging networks to geothermal energy storage talked of the validation of technologies, increases in production, and steadily declining costs. No bitterness here, as generous U.S. subsidies allow companies to raise funds and assure markets will exist for their products.

Even the nuclear industry, prone to massive cost overruns and sluggish growth, seemed hopeful, with former U.S. Energy Secretary Ernest Moniz and Jigar Shah, head of the DoE’s loan program talking of how standardized production and more building could slash costs. Small modular reactors and fusion believers were convinced their time is coming.

There was some agreement. Artificial intelligence, characteristically, was seen an opportunity, as it might double U.S. data center electricity use to around 35 gigawatts in 2030. Moreover, with the global economy expanding, the outlook for energy is relatively good.

But not every company in a rapidly changing industry can be above average, and that especially goes for energy, which is a commodity. Low cost, reliable sources eventually win. With solar now the cheapest source of electricity, and the cost of complementary goods like storage and electric cars falling fast, it’s understandable why green firms are optimistic about the future. Fossil fuel execs, however, might just be guzzling too much of the Texas juice.
Source: Reuters Breakingviews (Editing by Lauren Silva Laughlin and Aditya Sriwatsav)

Recent Videos

Hellenic Shipping News Worldwide Online Daily Newspaper on Hellenic and International Shipping