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Written by Daniel Graeber for Industrial Info Resources (Sugar Land, Texas)--U.S. energy security will be bolstered by creating a vibrant industrial base that meets the needs of the burgeoning renewable energy sector, President Joe Biden said.
The overwhelming demand destruction that eventually pushed crude oil prices into negative territory during the height of the COVID-19 pandemic prompted a concerted effort to pivot away from fossil fuels and toward renewables. With consumption of fossil fuels idled by social restrictions sparked by the pandemic, policymakers saw an opportunity.
Before the onset of the war in Ukraine, much of the talk in energy circles was on hydrogen hubs and carbon-capture and storage (CCS) centers. Crude oil prices, however, were on the rise even before the war as federal stimuli and pandemic cabin fever broke to put pressure on existing supplies.
That forced Biden to issue pleas for more oil, while at the same time advocating for a cleaner energy sector, much to the consternation of those on the right who argue that overwhelming support for domestic oil and natural gas are needed to protect the economy from foreign threats.
Without oil and natural gas, for example, Russia would not be able to weaponize its natural resources against the European Union (EU) in the same way that it has over the last few decades. Instead of being vulnerable to Russia, the EU would only be vulnerable to the glare of the sun or the strength of the wind.
To that end, Biden has invoked the Defense Production Act (DPA), a measure stemming from the Korean War that allows the federal government to help steer contracts to support certain industries.
The measure covers solar power, electrical grid components, heat pumps and insulation, as well as fuel cells and electrolyzers that can help facilitate hydrogen production.
U.S. Energy Secretary Jennifer Granholm cited the elusive drive for energy independence in lauding the president's actions.
"For too long the nation's clean energy supply chain has been over-reliant on foreign sources and adversarial nations," she said. "With the new DPA authority, the Department of Energy can help strengthen domestic solar, heat pump and grid-manufacturing industries, while fortifying America's economic security and creating good-paying jobs, and lowering utility costs along the way."
For related information, see June 9, 2022, article - U.S. Invokes Korean War-Era Law to Boost Clean Energy.
We noted earlier this week that Western sanctions against "adversarial nations" have sidelined more than 10 million barrels per day (BBL/d) of oil from the global market. Energy prices already account for the bulk of consumer inflation. Given the overwhelming strains emanating from the war in Ukraine, the World Bank said this week to expect a prolonged period of economic pain.
The impacts of climate change, however, are increasingly obvious. Hurricane strength last year was attributed to warming oceans, and global temperatures continue to rise.
And despite the attention given to the price of crude oil and natural gas, the U.S. renewable energy sector is expanding. In its latest monthly market report, the U.S. Energy Information Administration (EIA) noted that the largest increase in domestic electricity generation over the next two years likely will come from renewables.
But the U.S. remains somewhat behind the curve. Domestic coal production is expected to increase 3.9% this year and another 2.1% in 2023. Energy-related emissions of carbon dioxide, a potent greenhouse gas, are forecast to increase 1.3% this year, though that should reverse by next year.
Even still, the EIA said this year's emissions are driven largely by transportation demand, showing that, even with mounting economic and environmental concerns, the domestic economy remains firmly rooted in fossil fuels.
That suggests that, at least for the time being, national security and energy security will continue to run in tandem and leave policy concerns focused squarely on containing adversarial regimes.
Industrial Info Resources (IIR) is the world's leading provider of market intelligence across the upstream, midstream and downstream energy markets and all other major industrial markets. IIR's Global Market Intelligence Platform (GMI) supports our end-users across their core businesses, and helps them connect trends across multiple markets with access to real, qualified and validated project opportunities. Follow IIR on: LinkedIn.
The overwhelming demand destruction that eventually pushed crude oil prices into negative territory during the height of the COVID-19 pandemic prompted a concerted effort to pivot away from fossil fuels and toward renewables. With consumption of fossil fuels idled by social restrictions sparked by the pandemic, policymakers saw an opportunity.
Before the onset of the war in Ukraine, much of the talk in energy circles was on hydrogen hubs and carbon-capture and storage (CCS) centers. Crude oil prices, however, were on the rise even before the war as federal stimuli and pandemic cabin fever broke to put pressure on existing supplies.
That forced Biden to issue pleas for more oil, while at the same time advocating for a cleaner energy sector, much to the consternation of those on the right who argue that overwhelming support for domestic oil and natural gas are needed to protect the economy from foreign threats.
Without oil and natural gas, for example, Russia would not be able to weaponize its natural resources against the European Union (EU) in the same way that it has over the last few decades. Instead of being vulnerable to Russia, the EU would only be vulnerable to the glare of the sun or the strength of the wind.
To that end, Biden has invoked the Defense Production Act (DPA), a measure stemming from the Korean War that allows the federal government to help steer contracts to support certain industries.
The measure covers solar power, electrical grid components, heat pumps and insulation, as well as fuel cells and electrolyzers that can help facilitate hydrogen production.
U.S. Energy Secretary Jennifer Granholm cited the elusive drive for energy independence in lauding the president's actions.
"For too long the nation's clean energy supply chain has been over-reliant on foreign sources and adversarial nations," she said. "With the new DPA authority, the Department of Energy can help strengthen domestic solar, heat pump and grid-manufacturing industries, while fortifying America's economic security and creating good-paying jobs, and lowering utility costs along the way."
For related information, see June 9, 2022, article - U.S. Invokes Korean War-Era Law to Boost Clean Energy.
We noted earlier this week that Western sanctions against "adversarial nations" have sidelined more than 10 million barrels per day (BBL/d) of oil from the global market. Energy prices already account for the bulk of consumer inflation. Given the overwhelming strains emanating from the war in Ukraine, the World Bank said this week to expect a prolonged period of economic pain.
The impacts of climate change, however, are increasingly obvious. Hurricane strength last year was attributed to warming oceans, and global temperatures continue to rise.
And despite the attention given to the price of crude oil and natural gas, the U.S. renewable energy sector is expanding. In its latest monthly market report, the U.S. Energy Information Administration (EIA) noted that the largest increase in domestic electricity generation over the next two years likely will come from renewables.
But the U.S. remains somewhat behind the curve. Domestic coal production is expected to increase 3.9% this year and another 2.1% in 2023. Energy-related emissions of carbon dioxide, a potent greenhouse gas, are forecast to increase 1.3% this year, though that should reverse by next year.
Even still, the EIA said this year's emissions are driven largely by transportation demand, showing that, even with mounting economic and environmental concerns, the domestic economy remains firmly rooted in fossil fuels.
That suggests that, at least for the time being, national security and energy security will continue to run in tandem and leave policy concerns focused squarely on containing adversarial regimes.
Industrial Info Resources (IIR) is the world's leading provider of market intelligence across the upstream, midstream and downstream energy markets and all other major industrial markets. IIR's Global Market Intelligence Platform (GMI) supports our end-users across their core businesses, and helps them connect trends across multiple markets with access to real, qualified and validated project opportunities. Follow IIR on: LinkedIn.
