Baker Hughes CEO warns of three hard truths about energy transition – .

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Baker Hughes CEO warns of three hard truths about energy transition – .


Fossil fuels are here to stay. This is the message from a CEO of a major oilfield to those who watch gas prices soar in Europe, some with concern, others with fascination. They are here to stay because they help ensure a country’s energy security. “We think there are three hard truths”, Simonelli Recount CNBC in an interview this week. “First, we need to work together, accelerate the movement towards decarbonisation and also eliminate emissions. Second, hydrocarbons are here to stay… and natural gas, in fact, is key. And third, we need to do together, collaborate and actually embrace the new technologies available. “

Some would say that the current energy crisis in Europe is enough proof that there is something wrong with the way the EU and the UK have approached the energy transition. OPEC Secretary General Mohamed Barkindo, for example, told CNBC that a new premium was emerging in energy markets which he called “the transition premium”. This essentially means that the energy transition makes energy more expensive despite the promises of affordability.

Others, however, are careful not to blame anything related to the energy transition from renewables. The International Energy Agency mentioned earlier this week “several weather-related factors” among the reasons for soaring gas prices in Europe. “These include a particularly cold and long heating season in Europe last winter and lower than normal wind energy availability in recent weeks,” the agency said.

However, its leader Fatih Birol was quick to point out that it would be “inaccurate and misleading to dismiss the responsibility for the clean energy transition”, in what seems to be a perfect example of the growing reluctance of international organizations to challenge the image of renewables even in the face of hard evidence that in some cases they cannot deliver on their promises.

Some go even further.

A CNN article, for example, argues that the solution to the wind drought in the UK, which has contributed significantly to the country’s dire energy situation, is to build Suite wind farms, in different places, because “the wind will blow somewhere,” according to a professor of international politics at the University of Manchester.

Leaving aside questions about the qualifications and expertise of the various commentators on the subject, it seems that challenging anything about the energy transition is frowned upon. However, faced with an energy crisis caused mainly by insufficient gas supplies, it is difficult not to question the transition or rather the way it is being done.

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Gas was initially seen as a transitional fuel, the bridge being between the era of fossil fuels and the era of post-fossil renewables. However, as warnings about climate change mounted and governments became increasingly ambitious in their emission reduction targets, gas began to be removed from energy plans in Europe and the United States. Given the current energy situation in Europe, this was probably a premature decision. It wasn’t the first, and maybe it wasn’t the last. Because high gas prices are already increasing demand for coal and the EU’s ambition to be the greenest of green is crumbling.

“The price of carbon linked to the use of coal has increased the demand for gas. But now high gas prices are increasing demand for coal ” wrote Helen Thompson, professor of political economy at Cambridge University for the Financial Times this week. “If there weren’t serious intermittency issues with wind and solar and battery storage, it wouldn’t matter. In fact, the absence of a lot of wind in northern Europe this summer is significant. “

This intermittency is the elephant in the renewable energy room. Ignoring it in the name of political correctness and aligning with the party line will – and already has – consequences. It is because of these consequences that fossil fuels should retain their place in the global energy mix for a long time to come. It is a hard truth that must be digested in order to succeed in the energy transition.

By Irina Slav for Oil Octobers

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