The Last Squawk of the Carbonarchy
As Texas attempts to attempts to restore interrupted electric transmission to consumers savaged by a vicious cold snap, it’s citizens were treated to a hapless political leadership attempting to attribute blame for the widespread outages to frozen wind turbines. Greg Abbott’s constituents got to watch their governor on Fox News’s Sean Hannity show attacking the Green New Deal. Apparently the governor couldn’t resist the opportunity to heap scorn on renewable energy while plugging the virtue of fossil fuels.
Meanwhile Senator Ted Cruz decided a flight to balmy Cancun was in order rather than attempting to liaise with the Biden administration to see if federal relief could be secured for his beleaguered fellow Texans. Could be that he didn’t want to talk about ERCOT, the entity responsible for much of electricity transmission in Texas. Apparently ERCOT has been structured so that it doesn’t accept electricity from other grids beyond it’s borders. It seems, that would have required ERCOT to be subjected to federal regulation which is deemed evil. Interestingly, there are exceptions to the ERCOT hegemony in Texas, El Paso gets its electricity from the Western connect and has had minimal problems. Despite that, former Governor Perry has asserted that Texans would prefer to freeze periodically rather than deal with a more secure electricity supply bolstered by external suppliers.
Let’s be clear, it certainly seems the bulk of Texas’ wind transmission has been disabled by the freeze but so too has much of the energy generated by fossil fuels. Indeed a larger percentage of the Texas energy mix failure can be attributed to fossil fuel transmission sources. The problem lies not with the transmission source, rather it’s a failure of sufficient winterization of the Texas grid. Wind turbines work in Antarctica and in the northern states in much more trying conditions because they have been installed with sufficient safeguards against the cold. We can argue whether the same safeguards should have been applied to the cold crippled transmission elements of the Texas grid, that was a business decision based on an analysis of likely weather conditions in the Lone Star state.
Texas prides itself on being the energy capital of the United States. That claim to fame is based on the state’s enormous oil deposits whose gushers generated massive fortunes in the 20th century. However this prideful assertion is now being called into question with the dramatic expansion of renewable energy. Indeed most new energy transmission facilities coming on line are now predominantly renewable. Smart utility operators can see the writing on the wall and are opting to make the switch now, anticipating the continued improvement of renewable energy technology which will continue to drive down their costs. Since the sun shines and the wind blows in many other states, Texas is facing a demotion in its energy dominance unless it gets with the program and turns it’s back on the last century’s energy source.
All this spells doom for the Carbonarchy, companies who are faced with huge investments made in oil fields and coal deposits which are now increasingly unlikely to make it out of the ground. Wall Street has been paying attention to this slow motion train wreck. Take a look at any stock chart for a major oil producer and you’ll get a sense of the ugly situation. Here’s a five year chart for Texas based Exxon(blue line) a former darling of many well balanced stock portfolios vs the S&P 500 index(red line)
The chart certainly makes an easier case for the divestment push by activists opposed to fossil fuel companies. Good luck finding a stock chart for coal companies, most of them are bankrupt already. The Carbonarchy are not fools, they see the writing on the wall. They want to extract as much as they can from their resource investments before they are abandoned in situ crushed by the relentless progress of technology improvement in the renewable sector. The election of Joe Biden and his stated interest in tackling Global Warming with major investments in green energy is making the oil and few remaining coal executives shudder. General Motors recent phase out announcement of internal combustion cars must have added to the collective heart burn of oil executives
What we’re witnessing now is the last squawk of the Carbonarchy through its paid Texan political mouthpieces. The backlash was immediate and the back downs are beginning. Oil and coal are now the whale oil of the 21st century. Fortunately not all the whale oil was extracted in the 19th century. Our oceans are still graced by these majestic creatures although in much diminished numbers. So too, will oil and coal remain in the ground where they belong. With political fortitude and technical ingenuity we can save our planet from the worst depredations of Global Warming. Texas can continue to play a leading role in energy production but only if it elects a new forward looking political class that can see what is so clearly written on the wall
