“The notion of a fast track to a wholesale energy transition runs up against major obstacles – the shear scale of the energy system that supports the world economy, the need for reliability, the demand for mineral resources for renewables, and the disruption and conflicts that result from speed.”
Daniel Yergin, Pulitzer Prize winner for his history of the oil industry (The Prize) makes that assessment about our current energy situation in his book, The New Map (Penguin Press, 2020). Subtitle of the book – Energy, Climate, and the Clash of Nations – shows how all-encompassing any appraisal about energy must be. Yergin readily handles that assessment.
Yergin paints a tough and complex energy picture, maybe realistic is a better word. Add international to that. Yergin’s map includes …
- Technology: Oil, solar, wind, batteries, natural gas (in various forms), hydrogen, electric vehicles…
- Nations: US, Ukraine, China, Saudi Arabia, Iran, Israel, Japan, Mexico, Germany…
- Personalities: Elon Musk, Thomas Edison, Mohammed bin Salman, Mary Bara, Xi Jinping, Greta Thunberg…
- Science: Climate change, carbon capture, lithium batteries, “containerization,” fracking…
The New Map weaves together what would seem to be disparate angles on history, politics, geography, technology, and human idiosyncrasies. That may show why almost any prediction about energy is risky. For instance, I recall after the second oil crisis all the predictions that oil would soon go from its then astronomical level of $32 a barrel to more than $100. Quickly, too, it was said. Then oil dropped to about $9 a barrel instead. Or, the prediction that we would have hit “peak oil” by now, but recently the US has hit huge milestones in hydrocarbon production.
One way to show the richness of The New Map is to share a few stories from the book.
Most interesting to the Carolinas would be how an idea from a native of Shoe Heel, North Carolina, revolutionized world trade. Malcom McLean was known as “Idea-a-Minute” McLean. He had a small trucking company. He sped up the way trucks, and later ships, could be loaded and unloaded through something that became containers.
Management guru Peter Drucker said of this small-town NC native’s idea, “Without this hum-drum innovation, the tremendous expansion of world trade – the fastest growth in any major economic activity ever recorded – could not possibly have taken place.”
Yergin points out that McLean had never been on a ship. He just wanted lower shipping costs.
Another story is about a 2004 report from the National Intelligence Council. It forecast possible issues in 2020. One of them, said the report, “It is only a matter of time until a new pandemic appears…” Shifts in energy usage with COVID shows how important a non-energy issue, the virus, can be for energy and everyday people.
Or this: Electric vehicles (EVs) will play a big role in our energy future. Improving battery technology, a better network of chargers, and a cleaner grid are essential for that. Are countries moving ahead on EV? Yes. Yergin points out that Norway logged EVs as 45% of vehicle sales in 2019.
Above all Yergin shows the challenges in energy beyond the headlines.
Utilities and energy companies will face huge trials. “Established companies will be tested for their adaptability,” says Yergin about the energy transition. “New entrants will have to prove their business models. Partnerships and competition will characterize the relationships among different kinds of companies.” Ineffective companies will go away.
Scale is the big theme in The New Map. The energy industry, money, research, major pilot tests, and companies all need significant resources and capabilities to get to an energy system that serves people and the world.
Feature image from NextEra Energy news site.