The Future of Energy: A Choice Between Havers and Doers

Strategic Insights -

As the US government recently passed a bill favorable to fossil fuels, it is crucial to recognize the dangers of reverting to an outdated energy economy. Instead of investing in clean energy, the bill threatens to gut clean energy investments and undermine solar, wind, and battery industries. This choice between "havers" and "doers" will have significant implications for the country's future.

Key Takeaways:

  • The US has a choice between building its future on advanced batteries and renewables or staying stuck in an outdated fossil fuel economy.
  • The recently passed "big beautiful bill" chooses the latter, ceding ground to rising powers like China, which is leading the clean tech supply chain and electrifying its economy.
  • The distinction between "havers" and "doers" is crucial in understanding a country's energy options: havers rely on reserves they did not create, while doers build energy systems through ingenuity and innovation.
  • The US has both reserves of fossil fuels and a deep bench of engineering talent, liquid capital markets, and efficient innovation ecosystems, making it a unique case where it can choose its energy future.
  • Countries like Saudi Arabia and the UAE are repositioning themselves as doers through initiatives like Saudi Vision 2030 and the UAE's massive sovereign wealth investments.
  • Democrats need to lead the way in making the US a nation of doers by ending tax breaks for fossil fuel companies, streamlining authorizations for clean energy infrastructure, and scaling up renewable energy deployment.
  • The path to equity runs through execution, requiring tangible actions rather than just talk about creating equity.

Statistics:

  • China fuelled its rise with coal and remains the world's largest consumer of fossil fuels.
  • China dominates the clean tech supply chain, including solar and EVs, and is electrifying its economy by 10 percentage points each decade.
  • BYD is selling $10,000 self-driving electric cars.
  • Saudi Arabia and the UAE are investing heavily in manufacturing and logistics hubs, new forms of value creation.
  • The US can potentially add about 70 gigawatts per year of renewable energy deployment and expand heat pump installations to 8 million units annually.
  • Hundreds of thousands of people are employed in solar panel, battery storage, and electric vehicle industries that were built from scratch.

Sources:

  • "The Wealth of Nations" by Adam Smith
  • Statements from Tom Steyer and Galvanize Climate Solutions
  • Saudi Vision 2030 and the UAE's sovereign wealth investments
  • BYD's electric car sales
  • Renewable energy deployment statistics and heat pump installation goals.