Energy Transition

Perhaps the most striking fact about the American hydraulic-fracturing boom, though, is unknown to all but the most discriminating consumers of energy news: Fracking has been, for nearly all of its history, a money-losing boondoggle, profitable only recently, after being propped up by so much investment from venture capital and Wall Street that it resembled less an efficient-markets no-brainer and more a speculative empire of bubbles like Uber and WeWork.

At the risk of oversimplifying the never-ending complexities of energy, there is a climate lesson here — a clear contrast to draw. Fracking was nothing less than a genuine energy transition, enacted quite rapidly and at enormous upfront expense with only speculative paths to real profit, requiring large-scale infrastructure build-outs against some cultural and political resistance and yet celebrated all the while as a product of irrepressible capitalism, the almost inevitable result of the never-ending appetite Americans have for cheap energy. And yet for a decade, as fracking boomed, Americans were told again and again — and not just by climate deniers — that rushing a green transition would be too expensive, imposing a huge burden on taxpayers, who would be footing the bill to subsidize and support a renewable build-out that couldn’t possibly be justified in terms of market logic or demand.

Source: David Wallace-Well-NYT