In my article this past Friday I ended with this: Let’s pull together and “Spend Our energy moving forward together towards an answer.” – Jay
That seems like a good plan, but let’s throw some meat at that plan. We have to make some assumptions for the plan to work. First, we can talk and work together on the road to renewables. If we deliver the lowest kWh with the least impact on the environment we are off and running.
Let’s start with Saudi Arabia and its forward-looking plans. They have announced several large announcements over the last several weeks. Some key statistics for Saudi Arabia.
- Saudi Arabia is already forecasting their Budget balancing in 2023
- This in itself is huge. They do not want lower oil prices as it would not make their balanced budgets possible. With the
- Saudi Arabia Commits to Net-Zero Emissions by 2060
- *They also plan on using oil and gas profits to build world leadership in hydrogen manufacturing.
- *Blue hydrogen is made by converting gas and capturing carbon emissions.
- *Green hydrogen is produced by using renewable energy to manufacture.
- *Saudi Arabia can make the world’s cheapest green hydrogen.
- *Saudi Arabia aims to make 29 million tons of blue and green hydrogen annually by 2030. The projected market for hydrogen could be worth more than $700 billion annually by 2060 if costs can be reduced.
Saudi Arabia is not planning on having oil as its only source of revenue for its projected GDP. Looking at the growth in oil and gas revenues leaves a lot of other forms of energy that need to be added into the mix. Through setting up the natural gas fields as a major stepping stone to hydrogen is very much a forward-looking program that is good for the environment and their GDP.
One of the key parts of their plan to get to net-zero is to migrate their oil power stations to natural gas. That in itself will help dramatically. Using natural gas as a bridge fuel is the quickest and easiest way forward for them.
One thing that is to be admired of the Saudi leadership, and that is they create a plan and act. Their vision and path have several key takeaways worth noting.
- *Clean energy tech has a significant part of their plan. Getting the title of top hydrogen producer won’t happen without the investment into clean energy tech.
- *A commitment to using natural gas as a bridge fuel to lower the greenhouse gasses.
- *Creating a business model that can have other energy products replace oil as their main energy export.
- *Russia and Saudi Arabia have spoken together about creating an OPEC version for natural gas. Should this happen it would be devastating to the open market for natural gas prices.
The Saudi leadership holding oil production several months ago to help stabilize prices was an outstanding chess move. It reaffirmed their leadership in the world oil market while setting the stage for continued increases in oil prices.
So we have two questions to answer today.
What are our next steps in the Energy Crisis? Let’s set a new definition of acceptable energy. The lowest cost kWh to the consumer with the least amount of impact on the environment. The use of all types of energy can be used to support that formula. Nuclear should be on the top of the list.
How do we pick up the pieces on the road to renewable energy?
We have to have a single rallying point for everyone to get behind and in front to push and pull. The United Nations is out as they are politically motivated. We need to be more like Saudi Arabia in our thinking. They are making decisions for their citizens while looking to the future.
A committee made up of countries with no capital interest in fossil or renewable energy exports as the primary voting block. The more industrial countries should have a lesser voting block so they could not impose their will.
Appoint Saudi Arabia as the moderator of the group. Also do not allow tax credits or printing of money to pay for renewable forms of energy. Printing money to subsidize energy should be penalized as it does not help and leads to inflation.
Change the mindset of people to throw money at clean energy tech. The figures don’t lie. Using clean coal with clean energy tech will reduce the global greenhouse gases faster than dumping money into renewables in a poorly executed plan. We are seeing the results of those actions with worldwide inflation, an energy crisis that is just beginning, and wiping out any gains made over the last 20 years in damage to the environment.
Let’s pull together and “Spend Our energy moving forward together towards an answer.” – Jay
Later in the week, we will talk about some ideas for the United States, Canada, and Mexico. Send me your thoughts and I would like to hear from you about your thoughts on the current market.
Buckle up, we are in for some interesting times ahead.
Jay R. Young, CEO, King Operating