The fossil fuel follies continue. The environmentalists’ latest publicity campaign is a new name for more of the same: Stop the Money Pipeline, designed to bully banks, investment firms, and insurance providers into cutting ties with energy companies.
What the climate activists don’t realize is that divesting from fossil fuels won’t have any meaningful effect on climate change. It will only make life more expensive. Activists will be responsible not for saving the planet, but for worsening poverty around the world.
Despite the over-earnest claims of Stop the Money Pipeline that oil, gas, and coal, and now timber, will bring total environmental destruction — capitalizing on public awareness of the Australian bushfires and floods in Jakarta — such claims have no basis in reality. Government weather data has revealed no statistically significant increase in the number, length, or severity of climate-related natural disasters. As anyone who passed middle school science knows, correlation — or the perception of correlation due to overzealous media hype — is not causation.
Unfortunately, the investment manager BlackRock has already capitulated to the fear-mongering narrative. Its announcement that the firm will no longer invest in coal and “screen out” fossil fuels from future projects — which still wasn’t enough to satisfy the Sierra Club and other environmentalist groups — will succeed at only one thing: making the energy we depend on more expensive and unreliable.
We need only look to developing nations, where mothers cook over burning animal dung and children still die of ordinary ailments like diarrhea on a daily basis, to see what such a future would be like.
Having no or limited access to energy isn’t just an inconvenience. It means being trapped in poverty and poor health, lacking clean running water and modern medical care. It means sickness and nearly 4 million deaths a year from toxic air pollution caused by burning unsafe fuels indoors. It also perpetuates cycles of oppression, forcing women and girls to walk an average of 200 million hours a day just to collect water — 200 million hours they should be free to spend on education, civic engagement, or meaningful work.
The ramifications of unreliable renewable energy are particularly cruel in developing nations. The federal government’s Power Africa program, which seeks to provide renewable electricity to sub-Saharan Africa, has failed to deliver any meaningful improvement, providing an average of just seven hours per day of power. Seven hours of refrigeration does nothing to keep life-saving medicines and food preserved. Similarly, since much of that electricity comes from solar power, it can’t be counted on to provide significant light at nighttime.
Ultimately, no amount of virtue-signaling will meaningfully affect the climate. If the entire United States managed to abandon fossil fuels in the next decade global average temperatures would be reduced by a mere 0.139° by the year 2100.
Is less than two tenths of a degree really justification for eliminating our only reliable, affordable source of energy, especially when doing so would mean dismantling our economy and disconnecting the power we literally can’t live without?
In the United States, even after decades of multibillion-dollar subsidies, wind and solar still provide a mere 3% of our energy, and there’s no visible path to 100% for generations to come. Thus far, every attempt to shift more power to renewable energy has ended in dramatically higher costs, affecting not just energy prices but every purchase we make.
Residents of Germany, which is supposedly leading the world with its Energiewende renewable transition, are weighed down by record high electricity prices, up over 50 percent, with next to no environmental effect. Prices in Denmark have more than doubled.
Since the poor pay a disproportionately large share of their income on energy — and have less disposable income to afford the cost of goods and services rising along with the cost of electricity — these policies could push more people into more severe poverty. BlackRock and its counterparts in the banking and investment industry — not to mention the environmentalist movement — should remember that responsible environmental policies serve humanity, not the other way around.
The only sustainable option to lift people from poverty in the United States and around the world is to expand access to affordable, reliable, abundant energy — energy that, for the foreseeable future, can only be derived from fossil fuels. Blindly casting aside the fuels that enable us to live the longest, healthiest, most comfortable lives in human history would only succeed at making everything more expensive.
Instead of throwing temper tantrums at banks and investors, Stop the Money activists could better spend their time and energy on the more immediate threat to humanity: fighting poverty around the world.
The key to ending poverty across the globe is right under our feet, if only our financial and political leaders will allow an unencumbered market to work so millions could have access to the prosperity we take for granted.
This commentary originally appeared in RealClearEnergy on February 26, 2020.