TRANSCRIPT
James Lawler: [00:00:00] Welcome to Climate News Weekly. I am here with the one and only Julio Friedmann.
Julio Friedmann: Glad to join, as always.
James Lawler: So we’ve got a great lineup of stories from the past week in a bunch of different sectors. Julio, shall we start with Congress?
Julio Friedmann: Yes. Well, of course, it looks like we have avoided the nearest-term disaster.
We’re not shutting down for at least another, you know, 40 days or whatever it is. What will happen then is, is not clear. One of the specific risks associated with the shutdown and still a risk because of it, is in fact funding wildfire fighters.
James Lawler: Mm-hmm.
Julio Friedmann: In this case, this is, uh, HR 5860. It talks about a massive brain drain and personnel loss for the nation’s firefighters, and actually, they desperately need to get paid like so many other people. And [00:01:00] in this case, if that bill is not passed, if the money is not put in place for the Department of Interior to pay the firefighters, it will definitely lead to more damage, more loss of carbon, more loss of life, more loss of wildlife. That will come because that- your first line of defense against wildfires is firefighters.
James Lawler: Yeah. And just to add to that, as we all know, given the intense heat we’ve had this summer, we are in a- what is likely to be a strong El Nino winter, which will bring warm and dry temperatures into Canada, which will set us up for potentially an even worse firefighter season next year than we had this year.
Julio Friedmann: And the risks are very real, and if you have like a two month gap where you don’t pay the firefighters, that will be really devastating.
James Lawler: Right.
Julio Friedmann: It will affect supply chains, it will affect preparedness, it’ll affect responses, all of these things.
James Lawler: Right. Another story this week, Julio, ADIPEC opened this week with the CEO of ADNOC, [00:02:00] making opening remarks on how we all need to do more and need to do more faster and oil and gas companies have a big role to play. What do you make of those remarks and this conference?
Julio Friedmann: So for your listeners who are unfamiliar, ADIPEC is a major annual oil and gas conference. That’s what it is. It has included a whole set of discussions around clean fuels and climate and so forth.
But at its core, it’s an oil and gas conference. It is led every year and held every year in the United Arab Emirates, and it is led by ADNOC, the Abu Dhabi National Oil Company. Sultan Al Jaber is the CEO of that company. He is also the president of COP 28, which will take place in two months in Dubai, also in the Emirates.
So allies were on him because of this real tension and conflict between the role of oil and gas industries in providing global fuels and the need to [00:03:00] decarbonize and de-fossilize to reach key climate goals. Sultan Al Jaber has been very clear about how he thinks about this and he used the ADIPEC launch as a way to message.
He really does believe that oil and gas has a role in reducing greenhouse gas emissions globally. That includes the deployment of renewables. That includes the deployment of clean fuels, things like sustainable aviation fuels, or zero-carbon hydrogen. And he believes that oil and gas can play a very big role in things like carbon management, carbon capture and storage, and CO2 removal.
I did not attend this year’s event, but I attended last year’s event. To be clear, most of the talk was about things like clean hydrogen and sustainable aviation fuel and carbon capture. Easily 70 percent of the conference was dedicated to that. Still, it’s definitely an oil and gas conference.
They’re talking about profits. They’re talking about share buybacks. They’re talking [00:04:00] about growth and demand. This tension is exemplified by his statements and it ain’t going away because, apparently, we might see UAE hosting COP 29.
James Lawler: That’s really interesting. I mean, you see that tension now throughout the oil and gas industry. You know, Shell’s CEO is, is planning a town hall for staff.
This is another story amid anxiety over, sort of, his retrenchment towards investing in oil and gas infrastructure at the expense of, you know, renewable investments. Shell CEO Wael Sawan has been lauded by investors for this focus. Employees at Shell have posted letters publicly expressing anxiety that they’re not sure this direction is good for their children.
So, Sawan is holding a, a large, you know, internal sort of Q&A meeting to discuss these concerns.
Julio Friedmann: It is also the case that this tension is being played out in the boardrooms [00:05:00] as well as in retention, in employee retention, and employee satisfaction as reflected in this town hall. It is also this case that this tension is being played out in global diplomatic circles.
So it- like, this is going to be another perennial. The key issue here is, like, in the board, they are focused on profitability.
James Lawler: Right.
Julio Friedmann: Until CCS is wildly more profitable than producing oil, they’re not going to invest in it and in- at this kind of level, we want or need.
James Lawler: Right.
Julio Friedmann: So they either need regulatory push, they need a legal push, they need some kind of push to do more.
One of the challenges within the environmental industry, some people want to push them towards those and other people want to push them off a cliff.
James Lawler: Right.
Julio Friedmann: And I am sympathetic to Al Jaber’s core position, the oil and gas industry does play a role. I am also sympathetic to the environmental concerns and criticism.
They are simply [00:06:00] not doing enough in terms of the tonnage in the atmosphere and this tension will play out loudly for the next few years. One more thing though, I want to add: people talk about this as if the problem was entirely oil producers producing oil. It is a lot about the demand for oil, which continues to grow.
And a reasonable answer from Shell and a reasonable answer from Sultan Al Jaber is “you guys keep increasing demand. If you, if you put us out of business, Russia will do it. Brazil will do- other state-run oil companies will do it”.
So, until we really crunch down demand, until we really destroy the demand for oil and gas, mostly in the transportation sector, this tension will be with us for a long time. This perhaps relates to another story: the Q3 numbers for electric vehicles.
James Lawler: Yeah, let’s talk about that.
Julio Friedmann: There’s two take-homes that I take from this. One, really still [00:07:00] performing very well.
James Lawler: Yeah.
Julio Friedmann: EVs, broadly, are selling a whole lot. In the case of Tesla, they sold by far the most, almost 500,000 vehicles globally. That’s 7 percent less than last quarter, but that’s a really big number. That’s great.
And the same thing, you’re seeing overall sales are up in Hyundai and in BMW and Volkswagen.
James Lawler: By double and triple digits, up.
Julio Friedmann: That is important, actually. And I think that is laudable. So for example, Audi grew almost 100 percent over last year, but also they sold only 7,000 vehicles. So it’s doubling a small number. But again, that’s part of how we get to where we do.
We start small, we double, we double, we double. That’s really- so at its heart, these numbers are really good. It’s important to be clear, selling EVs is not the same thing as destroying demand, but it’s one of the things you need, like, and so it’s a good from a demand destruction perspective. And these are high numbers, and they’re good numbers.
Hidden within here, there’s [00:08:00] some bumpiness too. There’s some turbulence that bears noting. So, for example, in the case of Ford, they’ve sold a lot of vehicles. In particular, the Mustang Mach, but the sales for the F150 dropped. Okay, well, that’s not, that’s not uniform, endless growth for everybody.
James Lawler: Right.
Julio Friedmann: Same thing, for example, Rivian sold a lot of EVs, which is great, way up from a year ago, but it doesn’t help their bottom line. They’re selling these at a loss.
James Lawler: As Tesla did for a very, very long time, it’s worth noting.
Julio Friedmann: There’s two companies though, that were not in these numbers that are relevant. On the small end of the scale, Volvo. And the reason I mentioned that is because Volvo said in 2024, they’re going to stop making diesel engines.
Like they’re starting to get out of the ICE business, the internal combustion engine business. And so the fact that their sales weren’t here, kind of here or there, but, but their ticket or corporate stance is noteworthy among automakers. You’ve got a small maker and small sales, but noteworthy. The big numbers that we’re missing here are actually [00:09:00] from the Chinese makers.
James Lawler: Right.
Julio Friedmann: And we’ll just have to talk about those when those numbers come out and we see them.
James Lawler: Great. So last one, Pope Francis, in some circles known as the green Pope, has issued an update to the encyclical that was published a few years ago in a short piece.
Julio Friedmann: So the first encyclical was published, I think, eight years ago. That was Laudato Si.
James Lawler: Right.
Julio Friedmann: Which was two-thirds “care for poor people”, one third “care for the earth”.
James Lawler: Mm hmm.
Julio Friedmann: It was a major watershed, actually. And it really focused on the need for rapid decarbonization and rapid energy transition and having- coming from the pope, it was a major religious doctrine as well as a major political statement. That’s updated now in Laudato Deum, which means “praise God”.
And in it, it’s a scorcher like it is really terse, angry directive. It is [00:10:00] pointing out things that many in the environmental community have pointed out for a long time. We are simply failing. We are way behind. And as a consequence, humans will suffer, God’s creation will suffer. So it’s definitely a sort of fire and brimstone sort of representation of where we’re at and he doesn’t mince words.
Specifically, he talks about a kind of homicidal pragmatism in the world in terms of their leadership. That’s not a great comment. The last thing I’ll say, though, is compared to Laudato Si, Laudato Deum is more clear not just the need to decarbonize, but also the need to de-fossilize.
He makes a point of saying we need to really ratchet down production of fossil fuels in the encyclical. And again, people can disagree, but that’s a very major statement coming from someone with the moral authority and pragmatism of the Pope.
James Lawler: Right. Well, thanks, Julio. This was great, we’ve covered a lot.
Julio Friedmann: See you next week. [00:11:00]
James Lawler: That’s it for this week’s episode of Climate News Weekly. We hope you’ll join us next week.
Climate Now is made possible in part by our science partners like the Livermore Lab Foundation. The Livermore Lab Foundation supports climate research and carbon cleanup initiatives at the Lawrence Livermore National Lab, which is a Department of Energy applied science and research facility. More information on the foundation’s climate work can be found at livermorelabfoundation.org.
