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Excessive consumption in an energy-scarce world
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Excessive consumption in an energy-scarce world

Plus: Gas is Europe’s Achilles’ heel, debacle polarises debate + MORE

Seb Kennedy's avatar
Seb Kennedy
Feb 19, 2022
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Energy Flux
Excessive consumption in an energy-scarce world
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FIRST UP: The energy transition must reconcile some daunting disparities. The delta between the energy-rich and energy-poor has never been wider. The same goes for the rhetoric-reality gap on emissions, which is driving extreme divergence in long-term energy forecasts. Declining energy availability only complicates matters further. A high-level discussion about these issues is right here in this email – as well as the latest twists in Europe’s sorrowful attempts to secure gas supplies, and how the debacle is being interpreted by the commentatorati 👇

  • BREAKOUT STORY: I’ve been digging into the unusual results of the UK’s latest capacity auction, which subsidies standby power generators. What was supposed to be a straight analytical piece threw up a curious back-story about two mothballed gas-fired power plants. Getting to the bottom of it involved quizzing the UK government, regulator, system operator, consultants, company directors and even private lenders in Texas. This piece took about 15 hours to research, write and polish, but shouldn’t take more than about 7 minutes of your time to read. Click through to read:

Energy Flux
UK capacity subsidy balloons amid supply jitters
UK electricity consumers will pay more than ever to keep the lights on next winter, after the latest capacity market auction cleared at a record price of £75 per kilowatt per year. The result stems from an unusual UK government decision to subsidise all participating generators, citing market uncertainty. The British power market has experienced extreme volatility in recent months and faces the prospect of enduring tight winter supply margins — and yet two modern gas-fired power stations appear to have been excluded…
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3 years ago · 1 like · Seb Kennedy

IN THIS EMAIL:

💥Excess + scarcity = inequality + uncertainty

  • Unstoppable energy profligacy

  • Extreme energy inequality

  • Unfathomable demand uncertainty

💥Gas is Europe’s Achilles’ heel

  • Theatrical gas talks

💥EU gas debacle polarises debate

📺 Quote of the week

🌎Global headlines by key topic (20+ curated links)

🧠Energised minds: ‘We must avoid carbon tunnel vision’

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💥Excess + scarcity = inequality + uncertainty

Last Friday’s deep dive explored the concept of ‘surplus energy’, i.e. the net energy available to society after deducting the energy cost of producing it. Data suggest net energy is falling due to declining energy returns on energy investment (EROI), itself attributable to depletion and the switch to lower-quality shale resources. As we slip down the EROI ‘energy cliff’, we will – gradually then suddenly – enter an energy-scarce world.

With this in mind, three unrelated research papers caught my eye this week. They explore (a) excessive energy consumption in the UK, (b) global energy and emissions inequalities, and (c) widening oil demand uncertainty. Viewed through the lens of energy scarcity, my high-level interpretation of the findings is as follows:

  • Excessive consumption by a tiny influential ‘polluter-elite’ is unstoppable and increasing

  • This trend must be reversed, otherwise ‘net zero’ becomes unachievable

  • Extreme energy inequality is self-perpetuating. Any policies that drive up energy costs will exacerbate this feedback loop

  • The emissions rhetoric-reality gap is confusing forecasters, leading to unprecedented divergence in energy demand outlooks

  • This underplays the chances of soaring demand, which could prevail over artificial constraints (i.e. emissions targets) – but not physical constraints (i.e. diminishing surplus energy)

So, let’s dive in.

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