President Biden has declared war on Fossil fuels. He is also pushing for an end to international funding for fossil fuels in foreign countries.
But do these ambitious plans to curb fossil use and reduce emissions make any sense when the majority of world’s primary energy is still derived from fossil fuels? And how do we reconcile this with the fact that major economies are embracing fossil fuels at a record rate?
Banished by Biden: Energy Future of America and the World
President Biden has signed more executive orders in the first month (28) than any other in the past, with the exception of President Franklin D Roosevelt (30). Among the 28 were a string of orders aimed at reducing fossil fuel production and exploration.
He has halted issuance of new oil drilling rights, with exemption to native American owned lands. Biden is also holding talks with utility companies and automakers to persuade them to reduce emissions.
On January 27, 2020, President Biden signed the “Executive Order on Tackling the Climate Crisis at Home and Abroad”, outlining his administration’s plan to decarbonize the American economy. It also declared that climate change will be an essential element of the U.S. foreign policy and that the U.S. will discourage fossil fuel use in other countries.
Though he has stated that there will be a transition to renewable energy, he has not revealed how this transition will be made a reality, especially without an extensive use of fossil fuels. It is a well-known fact that Both Wind and Solar need backup from fossil fuel sources.
Moreover, even on a good day, renewables are incapable of supporting the current energy demand, causing serious disruption to the energy grid. This unreliability factor was evident during the wildfire induced blackouts in California last summer and the snowstorm induced blackouts in Texas this Winter.
On both occasions, the grid-overdependency on renewables acted as a key driver of the blackouts. Given the Renewable failure this Winter, it remains to be seen if temperate countries like the U.S. and Germany will reduce their fossil dependency further.
Despite the unprecedented number of executive orders, Biden’s war on fossil fuels may not impact the global fossil fuel trade or the use of fossil fuels in major fossil fuel economies. Here is why
A Parallel Universe of Fossil Acceleration
Thousands of miles away, nations like Australia, India, Russia, and China are doing exactly the opposite of what Biden intends to achieve. They are embracing coal and increasing coal dependency. It almost seems like a parallel universe of sorts, a coal haven.
India and China (constituting nearly 3 billion people) have pledged total support to their fossil fuel industry. China’s extreme Winter power demand forced utilities to reopen coal plants. Beijing continued to import large amount of coal from Indonesia, Australia, Russia, Mongolia and the Philippines. Last month, India’s Home Minister declared that fossil fuels are an integral part of country’s ambition to become a $5 trillion economy.
Russia has consolidated its position as the top exporter of coal to Turkey and Morocco. Reduced rail transportation cost for coal meant that the Russian export of coal has now become profitable for the exporters and has helped further streamline coal the export market. Besides, Russia also held talks with India and Japan recently to increase co-operation in a number of areas including coal mining.
Meanwhile, the OPEC—the Organization of the Petroleum Exporting Countries consisting of 13 countries—are expecting their profits to increase under a Biden administration as he is likely to cut down major share of U.S. oil in global market, thus benefitting the OPEC countries.
Unlikely to go Biden’s Way
If Biden pushes for a renewable transition and decides to suppress fossil fuel sector, it will put America’s energy sector in peril and there will be a measurable decline in America’s current status of being an energy superpower.
The anti-fossil policies of Biden, however, stand in stark contrast to the developing countries’ open embrace of fossil fuels. The extensive and continued use of fossil fuels globally pose a challenge to Biden’s vision of a global renewable utopia. His intentions to curb global funding for fossil fuels may not succeed.
In fact, it appears that his administration is already realizing the reality of energy dynamics in the country. The Interior Secretary nominee Deb Haaland now says that “President Biden’s pause on new oil and gas leasing is a temporary measure and won’t be a permanent thing.”
By all means, Biden’s aggressive anti-fossil agenda is likely to fail at the international stage, albeit minor disruptions.