Meanwhile, the inconvenient truth:
A little excerpt from Scotia Bank in their newest publication that attempts to give ESG ratings to Canadian Energy and Production companies, with a bit of elucidation on the gaming of countries attempting to get to (seemingly) lower emission levels....
Oil and Gas remain vital to modern civilization.
Global primary energy consumption increased 21% from 2009 to 2019 with fossil fuels remaining the dominant sources at ~84%.
Wind and solar penetration dramatically increased over this period; however, these sources still generate less that 4% of global primary energy.
While this may suggest a significant runway for growth, we believe it also points to the serious challenges posed by transitioning away from the high density and high efficiency energy provided by fossil fuels.
Germany’s heralded ‘Energiewende’ transition has resulted in the highest consumer electricity costs in Europe (
Germany's energy drive criticised over expense, risks) and concerns about supply shortfalls once the nation’s remaining nuclear reactors are shuttered.
In the midst of its transition away from fossil fuels, Europe is generating more electricity from burning wood than from wind and solar combined under the guise of biomass being a source of renewable energy (
Europe’s renewable energy policy is built on burning American trees)
The ‘Green Energy’ That Might Be Ruining the Planet
In our view, this is a step backward, as biomass emits more CO2 than coal per unit of energy generated. However, the choice does not necessarily have to be one of lower efficiency and (seemingly) lower emission or higher efficiency and higher emissions energy sources.
The innovations the Canadian oil and gas sector is undertaking to reduce GHG emissions across the value chain have the potential to keep Canadian energy in a prominent position even as several nations transition to lower emissions energy sources.
While there are many challenges ahead for all in energy transition, we see it more as energy evolution and believe
the oil and gas industry is likely to play a vital role in actually figuring out how to make material components of global emissions abatement aspirations become a reality.