Most talk about the climate crisis comes at it from the “demand side” — how to reduce demand for fossil fuels (FF) by replacing them with renewable electricity or becoming more efficient in the use of FF. We need to look at it from the “supply side” too.
Ongoing extraction of oil, methane (natural gas) and coal will eventually blow through the safe limits on greenhouse gas pollution. What’s less often acknowledged is that the FF industry’s planned investments in new projects would extend their dominance for decades into the future. The infrastructure they build now will need to keep operating and generating sales for long enough to pay off the trillions of dollars that are going to be invested in them. If this is allowed to happen the results will be catastrophic.
That will not stop them. The corporate boards and managements have definitively shown that they are willing and eager to descend into climate hell hanging from their golden parachutes, dragging the rest of us down with them.
All kinds of corporations are making pledges to clean up their act, often promising to operate with 100% clean energy by some future date. With the FF industry these pledges become a sick joke. They pledge to go “net zero” in their operations. This means an oil or gas company may plug leaks in its pipelines or buy “carbon offsets” that take credit for someone else’s low emissions, but it will do nothing at all about their product — the fuel flowing through those pipelines, which is the whole point.
Apparently the industry is not at all worried about the specter of “stranded assets” — investments that become worthless, straddling them with unpayable debt. One idea might be to let them eat the stranded assets, but this won’t work. The damage to the climate will already have been done, and by the time a company got to the point of admitting that an asset was stranded it would be bankrupt and unable to pay anyway.
Given how intransigent the FF industry has proven itself to be, there are only two alternatives. (1) Nationalize the entire industry and phase it out. (2) Make it cease and desist from all new extraction. Legally enjoin it or destroy it. Blow it up. Monkeywrench it. Cut the pipelines. Whatever it takes.
Now let’s see how much damage the industry is prepared to do. Then let’s consider the prospect of nationalization.
Carbon overshoot
The broadest consensus of the world’s climate scientists is represented by the Intergovernmental Panel on Climate Change (IPCC) and incorporated in the Paris Agreement of 2015. In Paris most of the world’s governments agreed (fingers crossed behind their backs) to achieve a goal of keeping the increase in the atmosphere’s average global temperature below 2° Centigrade or, preferably, to no more than 1.5°C.
Climate scientists agree that above 2° we will encounter, if we haven’t already, climate “tipping points,” irreversible changes that we cannot control, such as increased melting of the Arctic permafrost releasing methane and carbon-dioxide in huge quantities; the disappearance of Arctic sea ice, with the result that the dark water absorbs heat that the white ice and snow used to reflect; and the saturation of the oceans and forests with CO2, leaving more to be held in the atmosphere, heating it a faster rate than now.
Several studies have looked at the course we’re on including planned as well as existing FF extraction. Their conclusions are consistent and not encouraging.
In 2016 Oil Change International, an organization dedicated to exposing the true costs of FF, published “The Sky’s Limit”. They found that FF from already-producing coal mines and oil and gas fields are enough to put us over 2°C, and oil and gas without coal can put us over 1.5°C. “Yet right now, projected investment in new fields, mines, and transportation infrastructure over the next twenty years is $14 trillion – either a vast waste of money or a lethal capital injection.”
The Stockholm Environment Institute updated this assessment with its Production Gap Report 2021. The “production gap” is “the discrepancy between governments’ planned fossil fuel production and global production levels consistent with limiting warming to 1.5°C or 2°C.” Conclusion: “the world’s governments still plan to produce more than double the amount of fossil fuels in 2030 than would be consistent with limiting global warming to 1.5°C, and 45% more than consistent with limiting warming to 2°C.” (“Governments” because half of FF is produced by nation states or state-owned companies while governments also have substantial control over other producers.)
In May 2022 the UK’s Guardian newspaper released its “Carbon bombs” report. It identified 195 carbon bombs, which are oil and gas projects that will produce over a billion tons of CO2 each over their lifetimes. To put that in perspective, the entire world’s fossil fuel emissions are running at 37 billion tons a year. In total, they would release 646 billion tons and exceed the world’s “carbon budget” — the amount we can still release without breaking the 2°C barrier.
Can the fossil fuel industry be nationalized?
Yes. Someone’s already done the research. Thomas M. Hanna of The Democracy Collaborative and The Next System Project wrote A History of Nationalization in the United States: 1917–2009 looking at exactly that question.
It’s surprising how much nationalization of industry there has been in the ultra-capitalist US. It’s done most often in wartime, where it can be justified under the president’s power as commander in chief, but it’s also done in peacetime. It can be done by eminent domain — the taking of private property with just compensation — but it can also be done by act of Congress using its power under the Constitution “To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes.” This was done in converting the floundering passenger railroads into Amtrak in 1971 and to take over airport security from private companies after 9/11 by creating the Transportation Security Administration. The federal government also bailed out banks and auto companies by taking them over temporarily.
When Woodrow Wilson nationalized the railroads during World War I, the government took control of one-twelfth of the US economy. Says Hanna, “taking over the 25 largest publicly traded fossil fuel companies in the United States as well as all the remaining coal companies… would be approximately 1/14th of the present-day US economy.”
We can’t shut down the industry immediately. It will take time to replace everything that runs on FF, and many things that are essential for building the fossil-free future — things like cement, steel, and silicon solar cells — can’t yet be made without FF. But the industry intends to run until all the fuel is gone. We need to take what’s essential for the transition and leave the rest in the ground.
That’s what we have to finally do: Keep It in the Ground.
Henry Robertson is a climate activist and former environmental lawyer in St. Louis.