When I attended a recent energy conference, I expected a lot of gloom and doom, given low oil prices that have hurt some economic sectors.
But I was pleasantly surprised to see that a great deal of optimism still exists in the broad energy industry. The energy industry today has become remarkably diverse. Speakers and panelists represented a broad spectrum of stakeholders and interests, including the environmental community.
Here are some takeaways after listening to energy experts for two days:
- Unless we make some dumb mistakes, we are entering an era of energy abundance, which will be great for the economy and household budgets.
- Over time, the amount of energy derived from carbon-based sources (coal, gas and oil) is going to decline, while clean renewables and nuclear energy will ascend, making our energy future much cleaner. The technological advances in solar, wind, nuclear, and a variety of micro-energy sources are remarkable, and affordability is rising.
- This transition to clean, carbon-free energy will take some time, and we ought not to force it too quickly, or we risk damaging the economy and jobs and income levels. Cheap energy is required to create wealth. When people have money, they are more able to act on their environmental concerns. They have means to purchase electric cars, put solar panels on their roofs, and contribute to environmental groups. Wealth, derived in part from low energy costs, will speed the transition to a cleaner environment.
- Idaho’s “all-of-the-above” energy policy makes sense. We ought to let the free market work. Don’t artificially constrain or boost one form of energy over another. The marketplace is undoubtedly going to take us to clean energy, but we’ll keep the lights on and commerce humming along the way if we don’t pick winners and losers.
- The oil industry will come back, although perhaps not at the past peak boom levels. The oil extraction industry has become remarkably clean and environmentally responsible, although improvements need to be made in reducing methane leakage. Many firms are providing state-of-the-art environmental mitigation services.
- The electric utility industry is undergoing a major transformation as distributed energy in the form of wind, solar, and other micro-energy sources disrupt the old utility model of massive, centralized generation stations. As this transformation occurs, public policy, rate structures and even the central missions of utilities must be revisited. This transition must be managed carefully and smoothly to maintain the stability of the grid and keep reliable electricity flowing to all sectors of society.