The future rarely reinforces the status quo
I’m writing my next book about The Moment. Through these summer editions of Both of These Things Are True, I’m exploring the forces shaping The Moment and what it means for oil and gas leaders. I encourage readers to recognize what The Moment is giving us: the opportunity of our lifetimes to lead into the energy future. Let me know what you think.
It’s clear to me that within the industry there are two reads on The Moment—this window we’re entering where the immense difficulties of decarbonizing the whole economy will be laid bare for everyone. Either:
The Moment demands our engagement, action, and leadership—both to provide for energy needs now and to lead the world into an energy future with a lighter carbon footprint; or
The Moment secures the place of traditional fuels—including oil and gas—for the foreseeable future without our having to change course a single degree.
The first worldview, of course, is one I hold. But I’m challenging myself and my team at Adamantine to carefully reflect on the second worldview, and I’ll be doing just that in upcoming issues of Both True. In this Crystal Ball series, I’m first asking why smart, well-meaning industry leaders and supporters are looking at the same trends and coming to Worldview 2.
And then I’ll show you exactly what I see when I look at those trends and forecasts: Worldview 1, a once-in-a-generation opportunity for oil and gas to engage humbly and lead confidently.
It’s July and you’re on vacation and don’t want to read too much! So please check out this short preview of the areas I will turn to—and please do nominate other areas for crystal ball consideration if I didn’t catch your pet area of interest or concern.
Crystal Ball Asks
Here’s why it’s critical to understanding how leaders in our industry could have such different ways of looking at the same information: In the months ahead, executive teams and boards will hold strategic planning sessions to tackle the forces driving The Moment. (See my previous Both Trues “Reality Bites” and “Walk and Chew Gum, But Don’t Run” for deeper dives into some of these forces.) Whether they decide to seize the opportunity or double down on status quo engagement, politics, and planning depends on their forecast for the future.
Some of the drivers of The Moment that I’ll examine in upcoming Both Trues include:
Grid reliability. Growing worries about demands on the power grid are well founded—as demand grows, traditional nuclear, natural gas, and coal plants are shuttered, infrastructure ages, and reliance on intermittent resources increases.
California energy prices. Depending on your climate politics, California is either the fearless leader or the wildly irresponsible frontrunner. What’s generally well understood is that if a state is going to break the energy system’s reliability or consumers’ pocketbooks (or both), it’s going to be California.
European need for energy imports. Go-to stories on the failure of decarbonization policies abound on the continent. From increasing coal consumption to desperate pleas for natural gas imports, the stories of Europe’s success, failures, and future needs provide a source of endless fascination within our industry—and are catching the attention of observers elsewhere.
Data center power demand. Will the tech industry single-handedly revive the prospects for nuclear power? Will low-income consumers end up paying exorbitant prices for power because data centers will have locked up all the affordable baseload power?
Developing economies’ need for power. There’s no doubt that billions around the world will continue to pursue (and ideally achieve!) a high-energy middle-class lifestyle. Does this mean energy companies should double down on traditional fuels?
Many smart industry supporters look at each of these drivers and conclude that they mean a continuation of the energy status quo. I look at the same facts and information and come to a very different conclusion. Buckle up, because this will be fun!
Want the crystal ball tuned to other topics—the ones that come up in your boardroom or with your investors? Let me know what they are.
Both True editions will continue to come out every other week throughout the summer. Please join me in welcoming Mike King to Adamantine! If your crystal ball is foggy, hit that heart button below.
To clarity,
Tisha
