HEADLINE: “Reframe, repeat, rake it in”, by Irina Slav

“Wind and solar capacity additions are rising faster than electricity demand in the EU and the U.S., BP told us all in its 2025 Energy Outlook. This fast pace of additions was going to continue…”

View in browser

Reframe, repeat, rake it in

IRINA SLAV

SEP 29

∙

PAID

READ IN APP

Wind and solar capacity additions are rising faster than electricity demand in the EU and the U.S., BP told us all in its 2025 Energy Outlook. This fast pace of additions was going to continue in the future, as well, the BP outlookers also said, at the expense of what it called, with a straight face, “unabated fossil fuel use”.

Imagine my shock, then, when I learned that “US climate leaders are reframing their focus on power costs to counter attacks by Donald Trump’s administration, shifting the tactics behind a continued push into green energy.”

In other words, since saving the climate won’t work with that administration as justification for asking for subsidies, lowering electricity bills should, per the Financial Times, which was reporting on Climate Week NYC. The report cited one climate activism executive as claiming that the removal of IRA subsidies will result in higher electricity prices and another as saying, also with a straight face, that “The cleanest solutions are the most affordable solutions and that has huge pocketbook benefits for people’s lives,” adding that “There will be progress on climate because of the fundamentals.”

Another report on Climate Week NYC, from Forbes, said that discussion topics at the event included highlighting the “cool” factor of EVs and “Leveraging artificial intelligence (A.I.) and other tools and adaptations to your systems to make it “radically easy” for leaders and consumers to take steps that reduce their carbon footprint or take better care of the planet.” Something doesn’t add up, does it?

“Rapid growth in wind and solar power generation meets over 80% of the increase in electricity demand out to 2035 in Current Trajectory, with half of that occurring in China. Solar generation continues to grow more rapidly than wind power, reflecting faster declines in costs, shorter deployment timelines and greater policy support,” BP said in its outlook.

That’s basically the same as what that second activism executive quoted above, Vickie Patton, general counsel at the Environmental Defense Fund, said. Wind and solar, especially solar, are getting cheaper, so there’s no stopping them. Well, if this is the case, why the need to ask for more money from the government? Also, why has the rise in electricity prices in the U.S. oddly coincided with the strongest push for more wind and solar capacity?

I understand these are not questions that tend to be asked in polite society these days but they kind of force themselves on the energy conversation. A recent Wall Street Journal article provides some answers, such as the surge in demand prompted by the unabated growth in data centre construction and “overdue investments to upgrade aging parts of the grid and costs associated with replacing old coal-fired power plants.”

That makes sense. You get more demand, you get higher prices until you boost supply. Also, the more you delay essential maintenance work, the more expensive it becomes when you finally get around to doing it. However. That part about “costs associated with replacing old coal-fired power plants” bothers me.

In Bidentimes, coal was being replaced with wind and solar. Those, we are told, are really cheap and really good. So. What’s with these costs and how come they contributed in part to an average American electricity bill increase of a pretty solid 31% in the four years to this last August? Compared to an overall price increase of 19% in the same four years, as the WSJ’s Jinjoo Lee reports, citing Labor Department figures?

I can keep asking questions until Christmas but we’d all get bored, so I’ll stop. Besides, we all know the answers. The chief sustainability officer of GM can tell the whole world “how much her kids and their friends like riding in their electric SUV because they think it’s cool” but once the battery dies mid-journey, it won’t be so cool any more. Activist executives can go on as long as they want about cheap wind and solar but they will never stop asking for subsidies, proving themselves — and BP — wrong in the same breath. Meanwhile, TotalEnergies just sold half of its solar business in North America to KKR, for $950 million.

Okay, one last question: why is KKR buying solar assets under Trump? There is a net zero chance that Trump will suddenly change his mind about net zero energy. But maybe the next administration will bring back the subsidies and KKR is anticipating that moment in time.

Also, Orsted is in talks with Apollo to sell it a piece of an 8.5-billion-pound offshore project in the UK. Private equiteers love subsidies just as much as everyone else. Funny, though. The current UK government might not make it to the end of its five-year term and even if it does, chances are the next cabinet will not be as forthcoming with other people’s money as Starmer’s.

It seems, then, that the transition team and some people with lots of money (other people’s) are betting on future governments that would be more open than Trump’s to spending more trillions on a transition from the hydrocarbon-based energy system to one based on the weather and “demand response”.

If I were conspiratorially inclined, I’d say the people with the money are watching what the EU just did in Moldova, which is spreading democracy by means of banning inconvenient parties from elections, and taking notes for future use. After all, if there is one thing transition history has taught us, short as it is, that’s the fact that the only way the transition horse can win the race is by its owners crippling all the other horses.

BOTTOMLINE: “If I were conspiratorially inclined, I’d say the people with the money are watching what the EU just did in Moldova, which is spreading democracy by means of banning inconvenient parties from elections, and taking notes for future use. After all, if there is one thing transition history has taught us, short as it is, that’s the fact that the only way the transition horse can win the race is by its owners crippling all the other horses.”