A Free-Market Energy Blog

Paris Cheering vs. Energy Reality

By -- January 11, 2016

“Shameless preplanned back-slapping accompanied a Paris climate accord that guaranteed nothing except continued high fossil fuel emissions.”

– James Hansen, “Wanning Workshop + Beijing Charts + Year-End Comments,” December 29, 2015

The cheering for the global climate change agreement had not even died down before its critics were hard at work pointing out the shortcomings of the plan. One of the most prominent critics was none other than former NASA scientist and Columbia University adjunct professor, James Hansen.

Mr. Hansen is popularly credited with being the “father of global warming,” since retitled “climate change.”  In 2013, Mr. Hansen retired from NASA and government service so he could become a climate change activist and stage protests, something banned for government workers.  His subsequent activism led to several arrests outside the White House as he illegally protested against mining and the Keystone XL pipeline. The angry man was vitriolic about the Obama-led agreement reached earlier this month in Paris by close to 200 nations to reduce carbon emissions.

“It’s a fraud, really, a fake,” Mr. Hansen told a columnist with The Guardian newspaper on the day the Paris agreement was proclaimed.  “It’s just bullshit for them to say: ‘We’ll have a 2C warming target and then try to do a little better every five years.’  It’s just worthless words.  There is no action, just promises.  As long as fossil fuels appear to be the cheapest fuels out there, they will be continued to be burned.”

Mr. Hansen’s criticism, while similar to others, was probably from the most high-profile person to push back. His criticism was not unnoticed and prompted a question to U.S. Secretary of State John Kerry from ABC News the next day about the comments.  Sec. Kerry responded: “But with all due respect to him, I understand the criticisms of the agreement because it doesn’t have a mandatory scheme and it doesn’t have a compliance enforcement mechanism.  That’s true.

“But we have 186 countries, for the first time in history, all submitting independent plans that they have laid down, which are real, for reducing emissions,” Kerry said. “And what it does, in my judgment, more than anything else, there is a uniform standard of transparency. And therefore, we will know what everybody is doing.” He concluded:

The result will be a very clear signal to the marketplace of the world that people are moving into low carbon, no carbon, alternative renewable energy. And I think it’s going to create millions of jobs, enormous new investment in R&D, and that R&D is going to produce the solutions, not government.

In reality, Mr. Hansen, while criticizing the Paris agreement for its lack of aggressiveness, specificity and legality with respect to carbon emissions, was acknowledging several pertinent facts about the reality of the state of the energy business.

‘Yellow Brick Road’

First, even though the world has embarked on the ‘Yellow Brick Road’ of energy change, the journey will take much longer than the three-and-a-third hours of the Wizard of Oz movie – more likely five decades or more. While people are likely very familiar with the story of Dorothy, her strange friends and their visit to the wizard that is told in the movie, they probably don’t know that it wasn’t a big winner in 1939, the year of its release. The film lost out in that year’s Academy Awards competition for the Oscar for Best Picture, which went to Gone With The Wind, and it was largely a box office bust, collecting only $3,017,000 in global ticket sales against a production cost of $2,777,000.

Without trying to stretch the analogy too far, there are numerous similarities between the movie and the climate change movement. For example, the difficulties that beset Dorothy and her dog, Toto, at the start of the movie, including the tornado that carries her away from Kansas, are all filmed in sepia-toned (black and white) film, while the Land of Oz, where she is deposited by the storm, is in brilliant Technicolor.

Certainly, climate activists will tell you that if we continue on the road we are traveling, bad things, including economic devastation, will befall us.  Black will be our future.  However, if we do the right things with regards to reducing our carbon emissions, our future will become full of brilliant colors! The world’s beautiful future can be summed up by the Academy Award winning song, “Somewhere Over The Rainbow.”

Interestingly, the original movie producers, in planning their adaptation of L. Frank Baum’s book, The Wonderful Wizard of Oz, felt that 1939 audiences were too sophisticated to accept the story as a straight-forward fantasy, so the story was shifted into a lengthy and elaborate dream sequence.  That story-telling framework would probably sit well with climate change skeptics who believe climate change activists are dreaming with their arguments for radically changing our economy!

Expensive Forcing (Peiser)

A second point about the state of the energy business is the shift to renewable energy sources is expensive, despite the arguments about how much the cost of solar panels have declined and storage batteries improved. An op-ed article in last week’s Wall Street Journal by Benny Peiser, director of the London-based Global Warming Policy Forum, discussed how the lack of a legally-binding climate change treaty from the Paris conference has freed Europe from “the restrictions of the Kyoto Protocol – which runs out in 2020 – and opens the way for more flexible and less damaging policies.”

While the European Union’s 28 member nations pledged in October 2014 to cut carbon emissions by 40% below 1990 levels by 2030, that pledge would only be supported if all major emitters adopted legally binding targets.

With the United States refusing to accept a legally binding agreement, Mr. Peiser wrote: “The toothless nature of the Paris agreement finally allows EU member states to abandon unilateral decarbonization policies that have damaged Europe’s economies and its international competitiveness.” Citizens in Denmark and Germany now pay the highest electricity rates in Europe, and the German industrial sector is struggling with the high cost of power, which has made many companies less competitive and prompted them to shift production abroad in order to compete.

Mr. Peiser smugly points to Europe’s advantage and America’s disadvantage due to the respective positions of its respective leaders during the Paris agreement negotiations. He writes: “In contrast to Europe’s conditional pledge, Mr. Obama’s go-it-alone policy is unconditional.  For the first time, it would appear that Europe’s climate policy is moving in a more rational and realistic direction than that of North America.”  So if the Obama administration’s approach to climate change is not altered, it looks like their policies will result in a loss of U.S. economic competitiveness, further restraining our currently projected low economic growth future.

Nuclear Tiff

Hansen’s view is that until and unless greenhouse gas emissions are taxed across the board, it will be virtually impossible to force down emissions quickly enough to avoid the worst of the ravages of climate change. It is interesting that this July, six major energy company chief executive officers, including those of BG Group plc (BRGYY-OTC), BP plc (BP-NYSE), Eni SpA (E-NYSE), Royal Dutch Shell plc (RDS.A-NYSE), Statoil (STO-NYSE) and Total SA (TOT-NYSE), wrote in a letter this summer to Christiana Figueres, executive secretary of the U.S. Framework Convention on Climate Change, that they favored an open and direct dialogue on climate change and carbon pricing.

Even Rex Tillerson of Exxon Mobil Corp (XOM-NYSE) acknowledged that the best way to regulate carbon emissions is for there to be a revenue-neutral (fully-refundable) tax on carbon emissions. That is not the same as calling for a carbon tax, however.

This is a major concession by leading energy executives, but the offer seems to be failing to gain much, if any, traction. The climate change activists’ agenda appears quite rigid, which hurts efforts to improve the climate change discourse that could lead to agreement on steps for limiting carbon emissions.  An example of this rigidity lies in the abuse leveled at Mr. Hansen for embracing a role for nuclear energy in a low-carbon world.

Bill McKibben, climate writer, college professor and founder of 350.org (named after the belief that 350 parts per million of CO2 will mark a tipping point in climate change), was interviewed recently and admitted that while nuclear power should play a role in reducing carbon emissions, the people within his movement couldn’t embrace it because it would have confused them. As a result, by rejecting a role for nuclear power, the members would have a much easier time supporting an anti-fossil fuel mantra that is central to his organization. In reality, the issue is being anti-fossil fuels and not about seeking a path to a carbonless energy future.

The greater, and more frustrating reaction against realism in the climate debate came from a critique written by Naomi Oreskes, an author and professor of the History of Science and Affiliated Professor of Earth and Planetary Sciences at Harvard University, who labeled four leading climate scientists (James Hansen, Kerry Emanuel, Tom Wigley, and Ken Caldeira), who argued that nuclear needs to be a major part of an energy solution, but not the only part, as climate change deniers.

Oreskes Misdirection

Dr. Oreskes not only distorts the argument these scientists put forth but she falls back on claims that nuclear power is extremely dangerous, was developed to offset its use as a military weapon, and depends on government subsidies for its commercialization as reasons not to employ nuclear energy in any plan to decarbonize our power system.  None of the scientists Dr.Oreskes labels as “deniers” believes nuclear power is the only solution. Rather, as they stated in a letter written to UN officials organizing the Paris climate change conference, nuclear energy should play a role.

With respect to Dr. Oreskes’ claims against nuclear power, based on 70 years’ worth of studies about the survivors of Hiroshima and Nagasaki, the world’s experts in radiation biology have agreed that exposure to even high levels of radiation poses a surprisingly small human health risk. This conclusion has been supported by other studies related to people living in areas around the Chernobyl and Fukushima nuclear power plants.

Linking government support of nuclear power as a deliberative attempt to demonstrate the peaceful use of nuclear energy to offset its military use is purely an argument Dr. Oreskes employs designed to cloud people’s thinking about the issue without providing any substantive proof of the claim’s validity. While pointing to government support for nuclear power as one of its failures, she ignores the fact that renewable energy sources are all dependent on government subsidies and mandates.  Lastly, Dr. Oreskes relies on studies by Mark Jacobson of Stanford University that claim to show that the United States can power its economy totally with wind and solar power.  Not only have these studies been discredited by other peer-reviewed studies, but most highly respected climate scientists argue that wind and solar energy alone can’t do nearly enough to impact climate change.

What is sad about the climate change activists’ agenda is that it has gone well beyond adjusting consumer habits with respect to their energy consumption. Instead, they have developed a grand plan to transform society, meaning not only changing energy economics, but also restricting our slate of choices via mandates and banning the use of certain fuels. Their agenda also includes wealth redistribution, which has little to do with the use of energy but fits the moral belief of the activists.

Unfortunately, their moral agenda fails to consider the positives that are derived from the use of fossil fuels to bring cheap energy to the world’s impoverished people.


Allen Brooks authors Energy Musings approximately every two weeks. He has 40+ years experience in the energy and investment industries as an energy securities analyst, an oilfield service company manager, a consultant to energy company managements and a member of the board of directors of various oilfield service companies.

Leave a Reply