Chris Wright, US Secretary of Energy, addresses CERAWeek
Energy is not a sector of the economy; it is the sector that enables all others. Energy is life, and I’m honored to play a role in reversing what I believe has been a poor direction in energy policy.
The previous administration’s policy focused myopically on climate change, with people as collateral damage.
My predecessor said that LNG exports would soon be in the rear view mirror.
Natural gas supplies 25% of global primary energy and has been the fastest-growing source over the last 15 years.
Wind and solar supply roughly 3% of global primary energy. (I stick with the actual energy produced.)
Everywhere wind and solar penetration has increased, prices on the grid went up, and stability went down.
Is this pathway really going to put natural gas in the rear view mirror?
Nitrogen fertilizer synthesized from natural gas is responsible for half of global food production. Natural gas is also the largest source of home heating in the United States. It is central to the rapidly growing petrochemical industry and the largest supplier of processed heat for manufacturing.Natural gas is also responsible for 43% of US electricity.
There is simply no physical way that wind, solar, and batteries could replace the myriad uses of natural gas.
I spent my whole career as an entrepreneur and student of energy. I have worked on nuclear, solar, oil, geothermal, and natural gas. I was actively involved in four of these energy technologies. Just a few weeks ago, my new job necessitated that I depart and divest from all my ventures in the energy business. I even resigned from my long-term board position with a free market environmental organization, but my passion remains:
Bettering human lives via improved access to energy is unwavering.
Recently, I have been called a climate denier or climate skeptic; this is simply wrong. I am a climate realist.
I have been studying, speaking, and writing about climate change for over 20 years. The Trump Administration will treat climate change for what it is: a global physical phenomenon that is a side effect of building the modern world.
We have indeed raised global atmospheric CO2 concentration by 50% in the process of more than doubling human life expectancy, lifting millions of the world’s citizens out of grinding poverty, and launching modern medicine, telecommunications, planes, trains, and automobiles.
Everything in life involves trade-offs. Responses to climate change bring their own set of trade-offs. The Trump Administration will end the Biden administration’s irrational, quasi-religious policies on climate change that imposed endless sacrifices on our citizens.
Running the math on what might have been the benefits from these policies yields perhaps only a few hundreds of a degree reduction in global temperatures in the year 2100. The Trump Administration intends to be much more scientific and mathematically literate.
“We are reindustrializing America, not deindustrializing America.”Chris Wright, US Secretary of Energy
The previous administration’s climate policies have been impoverishing to our citizens, economically destructive to our businesses, and politically polarizing. The cure was far more destructive than the disease.
There are no winners in that world except for politicians and rapidly growing interest groups. The only interest group that we are concerned with is the American people.
Our focus will be steadfast on the American people and our allies abroad.
Let’s do a quick survey of energy access today.
Roughly 1 billion people live lives remotely recognizable to us in this room.
We wear fancy clothes mostly made out of hydrocarbons, we travel in motorized transport, the extra lucky of us fly across the world to attend conferences, we heat our homes in winter, cool them in summer, store myriad foods in our freezers and refrigerators, and have light communications and entertainment at the flip of a switch. This lifestyle requires an average of 13 barrels of oil per person per year.
What about the other 7 billion people? They want what we have. The other 7 billion people on average consume only three barrels of oil per person per year versus our 13. Africans average less than one barrel.
We need more energy, lots more energy. That much should be obvious.
Over half of people today are wearing hand wash clothes. They have yet to realize the time-saving and women-liberating joys of a washing machine. We need more energy.
Over 2 billion people today cook their daily meals and heat their homes by burning wood, causing indoor air pollution estimated to kill over 2 million people annually. We need more modern energy to prevent these deaths.
Where is the COP conference for this urgent global challenge?
Over 20% of Americans struggle to pay their energy bills, and roughly 10% have received a utility disconnection notice in the last 12 months.
The last administration recklessly pursued policies that would drive up electricity prices, knowing millions of Americans would struggle to keep their lights on.
Expensive energy or climate policies in wealthy Western nations have heavily impacted their citizens. Making energy more expensive has impoverished citizens and displaced energy-intensive manufacturers and well-paying blue-collar jobs.
Expensive energy policies do not reduce demand for energy-intensive materials; they simply move where those products are produced and who benefits from their production.
China now consumes nearly three times as much energy in manufacturing as the United States. We have outsourced too much manufacturing, and our allies in Europe have gone further in this direction.
It is ironic that the once mighty steel and petrochemical industries of the United Kingdom have been displaced to Asia, where the same products will be produced with higher greenhouse gas emissions and then shipped back to the United Kingdom on diesel-powered ships.
The net result is higher prices and fewer jobs for UK citizens, higher global greenhouse gas emissions, and all of this is termed a climate policy.
President Trump was elected to bring back common sense to Washington DC.
Let me highlight America’s common-sense pivot in energy: no more all-of-government approach to making energy more expensive, less reliable, and making it nearly impossible to build large-scale things in our country.
We are pursuing a policy of more American energy production and infrastructure, not less. Our goal is to reindustrialize America, not deindustrialize it.
Trump immediately ended the pause on LNG export permits.
Today, I announce our fourth action in this regard: improving the Delin offshore Louisiana LNG export terminal. This is in addition to previous actions on the Commonwealth and Golden Pass LNG projects and our actions to enable the bunkering of LNG for powering.
I find it hard to believe there was opposition to these policies that so clearly benefit Americans, our allies, and our environment. We are working to launch the long-awaited American nuclear Renaissance, both fission and fusion. The same goes for next generation geothermal energy.
We want more reliable, affordable, secure energy.
I am reversing policies that force consumers to pay more for clothes washers, dryers, hot water heaters, and dishwashers that deliver inferior performance. My goal is lower cost and higher performance. I also plan to reverse the destructive mandates forcing everyone to buy EVs, which have been wreaking havoc on our auto industry and forcing higher prices and reduced choices on consumers.
I could go on, but I’ll end with a few words about AI.
AI is going to be truly transformative in many ways that we can’t even foresee today. We are already experiencing the impacts and the benefits in consumer services, education, and business efficiencies. This is just the tip of the iceberg. Combining AI and quantum computing for drug discovery is likely to yield breathtaking results.
The same is true for potential advancements in Fusion Energy, likely to be demonstrated during this Administration. I’ve been visiting our National Laboratories, which are underappreciated gems in our country. The excitement is palpable to apply AI specifically for scientific advancement. AI impacts on National Defense, both offensive and defensive, are likely also transformative. The implications on National Defense make it critical that America leads the AI race.
We have the talent, innovative spirit, and leading companies to win, but all that won’t matter if we can’t deliver the energy. AI is an energy-intensive manufacturing industry.
It takes massive amounts of electricity to generate intelligence. The more energy invested, the more intelligence produced. Since the demand for intelligence is unlimited, so will be the demand for energy. Over the last four years, American electricity prices rose by over 20% with only about 2% demand growth.
Clearly, that trajectory is a train wreck waiting to happen as we enter a period of rapid demand growth for electricity.
Our 180° pivot will have to work at warp speed to enable the needed growth in electricity supply without saddling consumers with ever-rising electricity prices. Consumers are rightly upset with the price rises over the last four years. This is a daunting challenge. Success will require significant regulatory changes, massive private capital deployment, and innovative partnerships. None of this will be possible without thoughtful, rational policies on energy and a truly honest assessment of climate change.
Entering truly exciting times for human progress, if we play our cards right and unleash the human spirit, I look forward to working with all of you to better energize the world and fully unleash human potential.
