BP has published its second version of Energy Outlook 2030. It presents a very favorable global energy picture over the next few decades – despite a continued reliance on fossil fuels. While BP does foresee a growing use of renewable resources, the biggest changes in the future energy outlook are (1) increasing efficiencies in energy use and (2) the massive reserves of unconventional resources that new technology has made economically feasible. At first glance, this might seem to be a repudiation of the very rationale for this blog – the singular importance of energy as a geopolitical driver over the next quarter century. However, I contend that is quite the opposite. It is likely that only the US and Canada among developed and rapidly developing nations will enjoy security of supply (an argument that I have been making since before I began this blog), and that security combined with the relative insecurity of other nations will allow the United States to use both its resources and its growing geostrategic military reach to maintain its lead position on the world stage for the foreseeable future.
However, there is a glaring omission in BP’s projections: there is little attention paid to the impact of growing (even if decelerating) fossil fuel use on global warming. However, it is my belief that growing supply could very well outstrip growing demand over this time frame, which would cause prices to fall. That would leave room for carbon taxes, the revenues from which should be diverted to mitigation efforts. The latter will be a hard sell – there are entrenched interests on both sides that will fight it (from the right, carbon taxes are anathema while forces on the green left are hostile to a geo-engineering approach), but as water seeks its own level, so, too, do obvious policy choices.
