Why the Energy Transition isn’t what you think it is
Boards and executives today are stuck between two equally unworkable positions around energy and emissions. On the one hand, the science is clear: rising CO2 levels and increasingly wild weather dictate that we need to get off fossil fuels and onto renewable energy across the economy as quickly as possible.
On the other, renewable energy lacks the consistency and reliability to power today's economy so, unless we want massive socio-economic upheavals, we'd better stay on fossil fuels, and maybe transition to nuclear power.
Seen through their own narrow lenses, both positions are correct, and neither tells the full story. But the question isn’t whether we can power today's economy on renewables, it’s whether we can power tomorrow's?
Fossil Fuels Are Awesome
I'm not to prosecute the 'carbon emissions are bad for the climate' argument. That's got more supporting evidence than plate tectonics, and if you question plate tectonics you are very clearly considered 'fringe'.
So if we know the science, why do we keep doing something so obviously self destructive? This frustrates a lot of people, like the Just Stop Oil crowd, but we're humans and we're primed to prioritise gains today over losses tomorrow. And what gains!
Fossil fuels are energy dense and relatively easy to access. One barrel of oil delivers c. 6.1GJ, equivalent to around 6 years of physical work by a human¹. In 2024 we used 104.46 million barrels per day which, in manpower terms, is c. 220 billion people's worth of energy a year. You can store oil easily, burn it when you want and get power on demand. And to get one barrel of oil out of the ground, you need c. 1/20th of a barrel, i.e., the energy return on energy invested, or EROEI, is currently about 20:1. Factor in refining and transportation and the EROEI by the time you use it is more like 5:1, and this ratio is falling as easy-to-access reserves dry up.
Fossil fuels gave us the modern world including, most likely, everything around you. Currently, energy from fossil fuels is the economy. If we turned off the taps, everything stops, and that would be disastrous.
No, Renewables Are Awesome (Aren’t They?)
Renewables (let's focus on wind and solar) are getting cheaper by the day and annual installed capacity is growing exponentially. Furthermore, the EROEI for energy delivered to the economy is comparable to, or even better than fossil fuels (PV can be as low as 4:1, wind as high as 30:1). While they are famously intermittent and need an energy storage mechanism to give power on demand, battery prices are also coming down. Doesn't this all point to a displacement of fossil fuels for something cleaner?
No. For a few reasons.
They have a large land requirements (c. 12m²/kW for solar. Also see this article in Nature about land-take for different energy sources), and don't do wildlife or natural habitats any favours. )
You still need fossil fuels to make them: those forests above rare-earth reserves won't bulldoze themselves, you know, and carbon fibre turbine blades don't grow on trees.
You can't electrify everything that the economy does.
And my favourite:
There isn't enough stuff in the ground to electrify the current economy, and even if there were we couldn't dig it out in time, to say nothing of the mountains of waste we'd produce in the process. Simon Michaux has written and talked about this extensively, and has some great data to back it up, so I'll refer you to him rather than trying to ineloquently rehash his arguments.
As a corollary to that, everyone trying to decarbonise at the same time, say 2050, pretty much guarantees supply chain bottlenecks and failure to meet decarb targets for all but the early movers.
So, those charts of exponential growth in renewables that keep on showing up on Linked In often miss the wider picture, which is that renewables aren't displacing fossil fuels, they are adding to them.
The source of energy is not the problem, it's the amount
So, where does that leave us? We have a couple of immovable boundaries to our problem of how to power the future:
1. We need to reduce our carbon emissions, which means reducing fossil fuel consumption².
2. We can't practically power our 19TW society on renewables.
The only variable there is the amount of energy we use. [FN3] In other words, the energy transition everyone goes on about is currently focussing on the wrong thing. Don't switch to renewables and batteries and change nothing about how you operate; that will leave you highly exposed to energy shortages and supply chain constraints. But if you improve efficiency to use less energy, and change how and when you use energy, (e.g., align work and production with times of wind and sunshine), then renewables will allow you to keep on operating.
The (semi) global push to decarbonise really needs to be a global push to (partly) de-energise. This will require a combination of efficiency, frugality, and reconnecting with the natural cycles that drive all life. This might seem like a massive and impossible challenge, but we've been there before, through most of our history, in fact. Following natural flows is slower but is that a bad thing? No one needs to email at night or make telephones every single day of the year. We are burning out in record numbers because of this unnatural push for increased 'productivity' (which is often a measure of busyness rather than output). To me, reconnecting to natural rhythms is a win-win.
Just how do we do it? That will change depending on the business or organisation, but some no-regrets strategies might include:
Prioritising efficiency gains over betting on technological shifts;
Understanding potential supply chain pinch points;
Mapping operations against energy intermittency risk.
Navigating the true energy transition demands strategic foresight and a willingness to challenge conventional wisdom. At Danu Consulting, we partner with businesses and organisations to stress-test their transition strategies, identify vulnerabilities, and develop resilient pathways forward. We welcome a discussion on how these insights apply to your specific context.
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¹ Full discussion at http://theoildrum.com/node/4315, but in short, assuming 1 person can output 100W an hour × 8h/day × 365days/year = 292kWh/year = 1.05GJ/year, so 1 BBL ~ 6 years manual labour
² Because carbon capture and storage is a diversion, not a solution.
³ Even if we could switch to renewables, or some magical source of clean, free, rainforest-friendly energy, it's not like we've solved anything. (Take note, nuclear advocates!) Energy isn't the problem, growth is. I touched on that here, Tom Murphy entertainingly wrote about it here, and of course the Club of Rome wrote this book you might have heard of. Climate change is merely the symptom of the underlying problem, which is that we treat economic growth as the end goal, not just a stage on the development cycle. This drives ecological overshoot whereby we degrade the very systems of life on which we depend, and replace them with toxic waste. This is profoundly short-sighted. But again, others say it more eloquently. Here's William Rees.
