Europe’s ‘green revolution’ is a boon for coal and gas
Despite decades of climate research, public activism and international conferences, fossil fuels are back in fashion. Big producers are earning astronomical sums, their stock prices are rising and new investors are flooding in. The result is that the much-vaunted global transition to renewable energy is, once again, on hold.
Putin’s brutal war against the Ukrainian people has been instrumental in bringing about this change, by drastically disrupting the global trade in fossil fuels. The Russian occupation and the sanctions imposed by the United States caused energy prices to rise dramatically, up to fifteen times their pre-war levels at times.
Many hoped that these events could accelerate Europe’s transition to renewable energy. Some environmental groups have even embraced the resurgence of militarism, arguing that investing in renewable energy is a way to strengthen the West against its imperial rivals.
But the opposite turned out to be true. The FinancialTimes recently reported that European governments will spend more than €50 billion on infrastructure and fossil fuel supplies in preparation for the coming winter.
The coal barons are the most immediate beneficiaries of this toxic investment frenzy. Europe is currently spending an additional $4.5 billion reopening old coal-fired power plants and will import more than 13 billion tonnes of additional coal this year. This will result in a 7% increase in coal use, on top of last year’s 13% increase.
Similar patterns are occurring elsewhere, as more and more governments opt for the cheaper and dirtier option of coal. As a result, global coal demand is expected to return to the record level reached in 2013 and remain at this level at least until 2024.
Some commentators insist that this is all just a temporary accident, a small detour on the way to net zero by 2050. But that’s hogwash. The planet cannot afford any detours, as various signs indicate that it is already on a worse trajectory towards climate catastrophe than the UN’s Intergovernmental Panel on Climate Change would have hoped. And even in the unlikely event that the coal stimulus proves temporary, other elements of the European response will block fossil fuel consumption for decades.
This applies in particular to Europe’s plans to wean itself off Russian gas. The obvious response to energy price volatility would have been to invest trillions in public renewables, storage facilities and efficiency measures. This could be funded by a substantial increase in taxes on the wealthy, especially the fossil fuel billionaires who have selfishly driven human civilization to the bottom.on the verge of disaster. In the three months to the end of June alone, ExxonMobil, Shell and Chevron raked in $41 billion in profits.
Instead, the continent is pumping tens of billions into gas infrastructure, including new pipelines, offshore gas terminals and long-term contracts. The idea is to expand Europe’s ability to import and process gas from the Middle East, North America and even Australia. Germany alone is building five offshore terminals as well as two other permanent onshore gas processing facilities. The centre-left government – of which the German Greens are a part – has also just passed a new law suspending environmental assessments to ensure that nothing stands in the way of this project. In total, around 25 new gas processing facilities are being built across Europe.
These plans are a disaster for the climate. Each offshore terminal costs hundreds of millions of dollars to establish and operate, with onshore terminals costing even more, representing money that will not be spent on developing renewable energy and infrastructure. More disastrously, the gas supply contracts associated with these types of investments tend to be measured in decades. Those who invest such large sums in these projects, both governments and speculators, have an incentive to use them for as long as possible to maximize their returns, and therefore not to seriously reduce emissions during this period.
Some government officials maintained a pretense that this infrastructure could eventually be used for green hydrogen. But there is no evidence that green hydrogen can be produced efficiently at the scale required, or even that terminals and pipelines can handle such volatile material.
In a report published last November, the International Energy Association pointed out that “everything points to a growing gap between political ambitions and objectives on the one hand and the realities of the current energy system on the other”. What they are fighting against, even if they don’t want to face it because they are convinced that the system can change, is that the chatter about the transition is a political theater to distract us while the polluters pocket billion.
As if to underscore this point, the European Parliament recently passed a motion to increase its 2030 renewable energy target from 40% to 45%, which sounds good on paper but actions by constituent governments indicate they are not. don’t even intend to try to achieve.
In the midst of it all, Australian bosses have sniffed out an opportunity. With soaring fossil fuel prices, there is money to be made. Australian fossil fuel capitalists are currently rolling out more than 100 new coal and gas projects for the highly profitable export market.
One example suffices to clarify what this will mean for the global effort to prevent warming of more than 1.5 degrees. In June, Prime Minister Anthony Albanese approved the Scarborough gas project off the coast of Western Australia. It will produce around 1.4 billion tonnes of greenhouse gases over its lifetime, equivalent to three times Australia’s current annual emissions. And this is just one of 114 new coal or gas projects to be launched over the next few years. If they all go ahead, the result will be to double Australia’s annual emissions.
The bosses are ably aided by their loyal servants in the Labor Party. Under Albanese, the latter have mastered the European art of climate rotation: making a lot of noise about renewable energy and passing serious motions declaring their intention to make the transition, while entrenching fossil fuels more deeply in the economy.
Wherever they can around the world, fossil fuel exporters are investing in new capacity and preparing for decades of booming profits, spurred in part by the war in Ukraine. This is particularly concerning, because while the ruling class and its media try to pretend that the war in Ukraine is outside the normal functioning of the system, or some kind of temporary aberration, the reality is that war is a necessary and eternal part of capitalism. It is the logical and inevitable outgrowth of a society based on fierce competition for profit.
A war between the United States and China, now widely seen as inevitable, is likely to be many times more destructive than any other in human history. Already, huge sums are being diverted to military budgets in preparation. It is money that could be used to improve society and fix the environment. Factories that could employ people to do whatever we need for the transition are being used right now to produce increasingly high-tech tools of mass murder in anticipation of a coming war.
The threat of war may add to the litany of other crises the system generates every day. Open any newspaper and you will see reports of natural disasters, pandemic casualties, and collapsing living standards due to inflation. Besides their immediate impact on the lives of millions of people, each of these episodes acts as a shock to the system, disrupting both political and economic life in unpredictable ways.
Faced with these emergencies, the capitalists will frantically seek solutions in order to preserve the stability and profitability of their system. But such moments lend themselves to short-term fixes that are inherently rigged in favor of the wealthy and do not address the underlying issues.
So the Queensland government is set to spend $2.5 billion on relief and reconstruction this year, but continues to subsidize the Adani Coal Mine, which will ensure that future disasters will be even worse. Governments are more desperate to subsidize and serve industries that generate big profits in times of crisis.
Real action on climate change means not only ending these practices, but also spending vast amounts of money and resources on corrective action. A study commissioned by the United Nations Climate Action Champions estimates that $125 trillion needs to be spent globally to reach net zero by 2050. That’s a lot of money at the best of times. economic cases, which is not the case. As inflation and interest rates rise, pressure mounts on indebted governments, that is all, to cut spending, balance budgets and “reduce demand” . Governments that want to stick to the rules of the global financial system – again, all of them – will insist that they can’t afford to spend too much on things that don’t immediately improve the profitability of the economy. economy, such as schools, hospitals, welfare, and environmental annihilation avoidance.
To the extent that rich countries will continue to fund some green projects, they will do so primarily for public relations purposes. They won’t spend the huge sums needed to phase out fossil fuels, and they certainly won’t help poor countries do the same.
An orderly and socially just transition away from fossil fuels in the midst of climate breakdown is perhaps the greatest challenge humanity has ever faced. Capitalism is an obstacle to this, because such a large-scale transition requires an approach based on global cooperation, long-term planning and a system that values people and planet rather than profit. As governments prepare for war as the planet burns, melts, freezes and floods, the case for socialism has never been clearer.