INSIGHT by Dan Lashof and Karl Hausker, World Resources Institute
According to recent testimony from the American Petroleum Institute (API) and its allies in Congress, the solution to climate change driven by production and consumption of fossil fuels is…more fossil fuels!
Specifically, API is citing recent emissions reductions in the United States as justification for more production of U.S. oil and gas, and especially more exports of liquified natural gas (LNG). This argument is a perfect example of spinning two drops of truth into a downpour of misinformation. You can expect this spin to be amplified loudly by a well-funded and well-coordinated campaign to win expanded drilling on federal lands and approval of additional LNG terminals — actions that would undermine progress in tackling the climate crisis.
So, let’s unpack the argument to uncover its fundamental flaws.
One drop of truth is that annual U.S. greenhouse gas (GHG) emissions declined by 15.6%, or 1.17 billion tons of carbon dioxide equivalent, between their peak in 2007 and 2021, the latest year for which complete data are available. In absolute terms, this is the largest reduction achieved by any country during that period. The two phrases in italics are the keys to understanding how this fact is a misleading result of cherry-picking the data.
If you look at a longer period (starting with 1990, the base year adopted by the U.N. Framework Convention on Climate Change) and consider reductions in relative terms, then the United States stands out as a laggard rather than a leader among advanced economies. As shown in the table below, the U.S. has reduced its emissions by a mere 2% over the last 30 years, compared to upwards of 28% in European countries.
Another drop of truth is that a shift from coal to natural gas for electricity generation did contribute to reducing U.S. carbon dioxide emissions. But it was not the primary driver, as the oil and gas industry would have you believe.
Between 2007 and 2021, electricity generation from coal decreased from 2,016 billion kilowatt-hours (BkWh) to 899 BkWh, a reduction of 1,117 BkWh or 55%. Meanwhile, generation from gas increased by 682 BkWh, and generation from renewables (including hydro, wind and solar) increased by 463 BkWh. Importantly, total electricity generation remained about the same during this time while the economy grew by 29%, implying that increases in energy efficiency contributed significantly to reducing emissions.
Natural gas emits less carbon dioxide per kWh than coal, but increases in emissions from gas combustion partially offset the corresponding reduction in emissions from coal combustion. So the shift from coal to gas did not reduce emissions as much as the shift from coal to zero-emissions renewable electricity sources did.
Furthermore, methane leaks from the natural gas system need to be considered (which further offset some of the reductions in CO2 emissions from the coal-to-gas shift) particularly during the next crucial decades as we race to avoid breaching climate change thresholds. The U.S. just finalized a strong new methane rule that should help to address some of the impacts from methane emissions, but accelerated production of natural gas could diminish the gains.
This brings us to the biggest problem with the oil and gas industry’s talking points. They argue that because total U.S. emissions dropped from 2007-2021 at the same time oil and gas production increased, then the U.S. oil and gas industry should keep ramping up fossil fuel production.
This is magical thinking. Research shows that all unabated uses of fossil fuels need to be phased out as quickly as possible.
In past decades, there may have been an argument that increased use of natural gas could serve as a bridge to a low-carbon economy, as coal is phased out. But now we need to focus on substituting clean electricity for coal and gas and oil. Cheap renewables can now supply most of that electricity. And we have the technologies at hand to electrify a huge share of end-uses in buildings, transportation and industry.
The figure below from the International Energy Agency (IEA) Net Zero Roadmap presents one pathway for limiting warming to 1.5 degrees C, the limit scientists say is necessary for keeping increasingly dangerous climate change impacts at bay. The left side shows how unabated fossil fuels (without carbon capture and storage (CCS)) would decline sharply over the next 30 years. The right side shows how zero- and low-carbon energy sources would grow rapidly. Renewable energy capacity would rise more than seven-fold by 2050; nuclear generation more than doubles. Modern biomass energy use increases from a current 41 exajoules (EJ) to 100 EJ in 2050. The right side of the figure also shows some residual fossil use, either equipped with CCS or for non-energy use.
This is just one of many scenarios the world could pursue to achieve net-zero global emissions. The Intergovernmental Panel on Climate Change (IPCC) assessed several hundred others. The common theme in all of them is that electricity replaces fossil fuels as the major workhorse powering the world’s economy. Electrification of transportation, buildings and industry, along with applications in hydrogen production and carbon dioxide removal, leads to a doubling or more of global power generation by 2050. And that electricity is overwhelmingly from zero-carbon sources such as solar, wind and nuclear.
Electricity produced from fossil fuels equipped with CCS plays a varying, but usually small role. The IPCC found that to limit global warming to 1.5 degrees C, global use of coal, oil and gas in 2050 must decrease by about 95%, 60% and 45%, respectively, compared to 2019 (using the median values for those scenarios).
Have you already read?
Global coal demand expected to decline in coming years | IEA
Some will counter with the fact that the surge in U.S. LNG exports was a tremendous boon to Europe and the global economy in the wake of the Russian invasion of Ukraine — and this is beyond question. However, additional LNG projects would take years to build. Meanwhile, Europe is moving to further reduce its gas consumption, and most of global reshuffling of gas supplies driven by the invasion is complete.
To cut through conflicting talking points and cherry-picked data, it’s wise to remember the old adage: When you find yourself in a hole, stop digging. The solution to fossil fuel-driven climate change is not more fossil fuels.
| All opinions expressed are those of the author and/or quoted sources. investESG.eu is an independent and neutral platform dedicated to generating debate around ESG investing topics.
