Regular readers may have noticed that I oscillate between optimism and pessimism when it comes to climate change and energy. So let's call this a glass-half-full day, in which I highlight two related pieces from the FT's energy writer, Nick Butler, who writes that 'Almost all the major oil and gas companies I know are undertaking substantial reviews of their policies on climate change.' He lists several reasons why (including 'because the industry takes climate change seriously'), but I found this one particularly noteworthy:
...reputation does matter, not least for morale within the company. Without a clear forward strategy on climate change, companies start to feel defensive. As one rising executive in one of the companies said to me last week – “I don’t want to work for the tobacco industry”.
Then there's Butler's earlier piece on the rise of solar energy:
...there is growing evidence that some fundamental changes are coming that will over time put a question mark over investments in the old energy systems.
Wood Mackenzie, a consulting firm with an impressive track record, recently published a report that said that within 5 years solar would be fully competitive with traditional sources of energy in 19 states in the US. Within a decade the number of states will double. “Fully competitive” means without subsidies. The detail matters – the US is a low cost energy market compared with most of the rest of the world. To be competitive there against coal and gas – without subsidies and without any carbon price – is quite something.
Of course, as with every column on this topic, this one comes with a caveat about the problem of storing solar-generated energy. But entrepreneur Elon Musk is set to make a major announcement on that issue at the end of the month. Through his electric car company Tesla, Musk is building the world's biggest battery factory, and it looks like he is preparing to branch out from car batteries to home batteries. If it's affordable (this article suggests it will be), it will allow homeowners and communities to go 'off grid'. If such technology becomes widespread, it could transform (sorry) the power industry in advanced economies.
Photo by Flickr user US Army Environmental.