He had quite a bit to say about the Geopolitics of the Global Energy Revolution. Ambassador Pascual, a greatly experienced and articulate man, led us on a tour of some of the most salient issues in global energy. He highlighted what he thought were “five revolutions” that are underway in supply transformation, emerging market demand, “liquid gas,” clean power, and energy access.By supply transformation, Pascual primarily meant the explosion in shale and tight gas, and shale oil, largely in the US, but, increasingly, elsewhere. See this graphic from the EIA on natural gas and the projected huge growth in shale and tight gas production. By emerging market demand, it has been pretty clear for some time that the burgeoning economies of China, and to a lesser extent, India and some others, are the drivers of demand growth. This is one good illustration of that explosion. The revolution in “liquid gas” is taking place because of the rapid growth of liquefied natural gas (LNG) transportation as against pipeline gas. See this chart from Pascual’s presentation. It shows that pipelines will still be the principal mode of transportation but that LNG flows had already increased by 9% over the past ten years and will continue to grow.
See those flows as of 2012 in this graphic from BP. See also this on LNG from the Council on Foreign Relations. On clean power, Pascual identified some of the obvious breakthroughs, in wind, solar and geothermal, among others, but also noted the advantages in natural gas. More about that in a moment. The fifth revolution he talked about was in energy access. In short, for a relatively modest investment of $48 billion a year, we can eliminate energy poverty worldwide by 2030. State is doing important work advancing the UN’s Sustainable Energy for All (SE4All) initiative.
Going back to natural gas, Pascual pointed out that since China – as we know all too well – is a carbon nightmare, we’ve got to address that, sooner rather than later. China was responsible for 80% of the growth in the world’s energy-related carbon dioxide emissions in 2011. As he and many others have long known, if we don’t get China’s carbon output down, we’re going to be looking at an unlivable planet. State is working with China on, for one thing, helping to develop their shale gas resource. Anathema as the new technologies for extracting hydrocarbons in shale and tight rock formations may be for some people, the benefits of using natural gas are manifest, the most important one being that the carbon footprint is half that of coal’s when burned for power. State is fostering this program for sustainable shale gas development. When asked the perfectly logical question if natural gas development will impede our progress toward renewables, he answered that it will enhance the growth of renewables. How? It will allow flexibility in the power sector to offset some of the variability of solar and wind as we build these out. Many have noted this quality – that gas can be a lever to get us to a fully decarbonized future. See this analysis at Yale Environment 360 for a good explanation of how that works.
I told Pascual that I was glad, as an American and as a climate activist, that we had people like him, John Kerry, and, for that matter, Barack Obama, doing the work that needs to be done.