Some Future Day

[00:02:39] All right. Welcome to Some Future Day, Carolyn. It's great to see you today. I'm thrilled to have you as a guest.
[00:02:45] Well, Mark, thank you so much. I'm really delighted to be here. It's, thank you for the invitation to, to partake. This is great. Congratulations on, on starting some future day. It's very exciting.
[00:02:57] Yeah, so thank you. I appreciate the kind words. let's start from a macro
[00:03:01] perspective, Carolyn. there's a lot of doom and gloom as it relates to climate change and topics like this. So, my first question to you is, you know, truly macro, like, is the world ending?
[00:03:14] No, the world is not ending. I would encourage all of your listeners, viewers to kind of move away from apocalyptic thinking. the world is not going to end any time soon, or at least it's not going to end because of climate change anytime soon. I can't take, you know, intellectual responsibility for other things that that could end the world, but, you know, climate changes is a, it's, It's a very significant problem. It's an existential threat, but it's not, it's not a, we don't see an imminent end to the world anytime soon.
[00:03:57] So, is it, like, would you categorize, the general
[00:04:00] sentiment surrounding climate change as an
[00:04:03] era of pessimism and, you know, if so,
[00:04:07] like, what what role does the media and social media play in creating, this sentiment?
[00:04:14] So I think its two things. So there was a period where there was very little attention to climate change and you know, the science of climate change was, unless you. We're in that space in the science, you know, as a scientist or in the, you know, understanding climate modeling and its impacts on, on change, in terms of planetary change, you really just.
[00:04:40] The The mainstream never sort of had access to kind of understanding climate change. So that's been a
[00:04:48] positive is that there's much more of a, attention to climate change. And there's also been a, sort of a shift in the accessibility and making the science feel and sound more accessible so that, that.
[00:05:05] People can better understand that, yes, climate change is happening. Yes, um, humans are contributing, fossil fuel production is contributing, you know, understanding the role that carbon emissions and greenhouse gases play,
[00:05:21] welcome.
[00:05:33] opportunity to, I don't like to use the word combat because I don't think we will combat climate change, but how we address and how we, think about mitigating against climate change and also adapting to climate change. and then there, you know, there's still, some climate denial.
[00:06:00] That is in the media. However, I think if you to just do a kind of an assessment, discourse assessment over the last 10 years, you've seen a reduction that there's less climate denial in the media. Than existed, 10 years ago. So there's much more of a, an acknowledgement that climate change is real, that it is happening and that it does need to be addressed
[00:06:28] so it keeps a lot
[00:06:29] of people up at night, especially, people in the younger generations, young
[00:06:34] millennials, Gen Z, and,
[00:06:36] know, even Gen Alpha. Like, I gotta be honest, my seven year old daughter, Damaris, comes
[00:06:40] into the bathroom and tells me to turn off the shower while I'm in it. So, can you just level set the audience and tell us, are we, you know, again, I, realize I'm, speaking in broad strokes here and generalizing, but are we better off today than we were 50 years ago, 100 years ago, generally speaking, or are we worse off?
[00:07:01] well. So I commend your daughter. That's great. 'cause I think all of us probably take, our showers are too long.
[00:07:08] And I think, you know, even when you go back
[00:07:10] to, you know, mark, you and I are kind of. of a similar generation, you know, how people started to draw attention to littering, right? Littering was, you know, in terms of what you do
[00:07:22] with your trash. So there was a campaign when we were growing up, right? So, you know, as young people and children, they're
[00:07:30] like, wait a second, I don't, you know, I want clean streets. I
[00:07:33] want my parks to be clean. So calling out. Adults when they're not, you know, kind of following the rules.
[00:07:42] I think there is a lot of anxiety around climate change, which is, you know, it's, it can both be a motivator to be involved and to,
[00:07:53] to.
[00:07:54] You know, think about how you can be a kind of an activist, whether it is through the way that you think about the, your trajectory and what you want to do in life.
[00:08:04] but I would say that overall, overall, we're so much better off today than we were in, on a lot of fronts, right? We, you know, I think there's, You know, if you think about globally, so it depends on where you're looking. If we're
[00:08:18] only looking here in the United States, again, depending on where you're looking, but I think globally, we've seen, you know, we've seen less people living in poverty, so we have seen poverty reduction, from a climate change perspective. We're seeing more emissions, which is a negative, but we're also seeing, you know, a fair amount of change in our energy systems. And I very much emphasize systems because there's not a one global energy system. We have a multitude of systems. that exist across different countries, but also across within
[00:09:01] countries who have different energy systems.
[00:09:04] So Carolyn, when you talk
[00:09:05] about energy systems, are
[00:09:06] you talking about the concept of essentially an ecosystem? Where, let's say here in New York City, we can use, perhaps, you know, just theoretically speaking in the future, some sort of a blend of energy, wind, solar, nuclear, even maybe fossil fuels, coal, but, the idea is that not one particular energy source would stand alone to, fuel New York City, but perhaps it's this broader ecosystem?
[00:09:34] Is that what you're referring to?
[00:09:36] Yes, absolutely. And right. And even in the United States, some states are heavy. They still continue to use coal. We don't use coal in New York. we use a lot of natural gas, right?
[00:09:47] We're trying to bring in wind energy where we use hydropower from Quebec. You know, there's, you know, in terms of some nuclear, so we have a, you know, there's not one, one source of energy that powers New York.
[00:10:08] And again, if you're thinking about, you know, I'm sitting in the East Village, if you go outside and you look at cars, that is, that's for the most part, those are, that's, oil. That's. That's gasoline. where if you're turning on your lights, that's for the most part, it's, natural gas. It might be some hydro, some
[00:10:27] nuclear.
[00:10:28] So if you're thinking about the electricity system, if you're thinking about the transportation system, you're looking at different sources of energy. If you go to Kentucky.
[00:10:39] and
[00:10:40] It's mostly coal fired power plants that are helping
[00:10:43] to you know, help in that system. So it varies,
[00:10:48] and some of it is driven by politics and some of it is driven by availability and accessibility, in terms of what an energy system. within a state, within a city, will look like.
[00:11:00] But generally speaking, fast
[00:11:01] forward into the future, 10, 20, 30 years out, you think these, blended ecosystems are the way that most, cities across the nation
[00:11:12] will be, energized effectively?
[00:11:14] Yeah, so a lot of cities, New York City being one, so whether it be, you know, coming down from the state level, Governor Hochul, but, you know, also Mayor Adams, you know, they have commitments to reduce fossil energy within New York City, within New York State, and replace hydrocarbons with more renewable energy. wind, solar, long storage batteries, hydropower, so that less hydrocarbons and more renewable energy, more or less carbon intensive energy.
[00:11:57] So, Carolyn, I'm happy that you spoke to New York City and New York State. I understand
[00:12:02] that, you know, at least here domestically in the United States, New York State is considered ahead of the
[00:12:09] curve as it relates to energy related topics. And it's my understanding that New York State and New York City have some changes in store as it relates to bringing energy to new buildings, that are created, I think by, I could be mistaken, is it 2025?
[00:12:27] am I right? Okay, like I'm not, reading notes on that. I'm, that's,
[00:12:34] I'm proud of
[00:12:35] it's
[00:12:36] So what is, that exactly? And then what I really want to know is like, are we overzealous as a community? Like, is it feasible for us to implement that
[00:12:47] level of, commitment in such a short period of time?
[00:12:51] I mean, here we are pushing into 2024 right now. So you raised the
[00:12:56] So, great question, these are ambitious commitments, these are ambitious targets, so I think the easiest way for your audience to think about is like there are two laws, one is local law,
[00:13:08] of
[00:13:10] uh, and that is specific to buildings that are 20, 4,000 square feet or more that, that there are specific carbon reduction targets that are set for buildings.
[00:13:24] Bumhoffer,
[00:13:27] but generally that's the idea. and that goes into effect by, in 2024 and the law 1 54. Is that any new bill? of a large type, again, sort of 25, 000
[00:13:44] square feet or more, using gas or oil will be
[00:13:48] prohibited. And that in, in also, if you are doing a, massive renovation Of a
[00:13:54] existing building, that building might also qualify under the requirements of, 154, are we ready?
[00:14:06] It's very problematic. It's really like we'd have to spend the next couple of hours because it really does depend. Some buildings are, have been working on,
[00:14:17] you know, preparing for the for the law and choosing not to pay fines because that would, that's that kind of like, if you're not meeting the, requirements, there are fines associated with it. other buildings, again, it's very expensive to do these types of retrofits. It's, can be complicated. Also, again, kind of going back to your earlier question about our system, some of
[00:14:42] the, assumptions that were built in and as to how much renewable energy New York City would have available at this point, you know, there have been some delays.
[00:14:53] and some bits and some challenges,
[00:14:55] so it's, you know, I think building owners and developers are sort of thinking about this in
[00:15:01] different ways, but I think overall the policy directives are meant to kind of move change. And. Do it, you know, do it via regulation. So setting high bars of regulation and compliance that then sort of force, force the shift and the transition away from, you know, a lot of hydrocarbons to less to a more decarbonized system with within our buildings.
[00:15:33] So it sounds like what you're describing on
[00:15:36] a
[00:15:36] local level might be endemic on an international level. This tension between progress in climate to climate change versus commercial growth, that something that exists? And if so, can you Talk about it a little bit, please. This
[00:15:55] Sure. I mean. You know, I think there are, so, you know, we have the conference of parties coming up in the United Arab Emirates. There are a lot of like targets that have been set, internationally about where countries, where the world needs to go around
[00:16:12] the energy transition, reducing the amount of fossil
[00:16:15] fuels.
[00:16:17] Mark, I'm going to just like, I'm very pragmatic when it comes to you know, how I think about energy. the world uses. It's a lot of energy and that's generally good because that, that also sort of helps to
[00:16:34] sustain, lives. It helps to
[00:16:38] sustain progress and move progress forward. But like we use, The world consumes 102 million barrels of oil a day.
[00:16:46] Right? that's not going to change anytime soon. we use a lot of natural gas. A lot of developing countries use a lot of coal, right? So, the transition is not going to be an overnight one. And I think that idea that So, I think there is a tension that if things move too quickly, or I should say, if there's the assumption that things will be in place, that the energy transition will sort of happen in an orderly way, which is You know, a, very positive assumption. However, the reality is that there are many hiccups. There are challenges to transitioning energy systems. And so you have to be able to balance that so that you don't see, you don't see sort of the negative consequences to, to the to economies, right? So you don't want economic decline while.
[00:17:50] Undergoing the energy transition. So it's a very, it's, a, it's,
[00:17:55] a difficult balance because you wanna be able to sort of be integrating less carbon intensive energies, but you don't want it to be
[00:18:05] disruptive. Ideally. Ideally. I mean, you don't wanna be disruptive so that you know, you Places, for example, are experiencing blackouts. That's not good. You don't want the price to the consumer for electricity to go up too high because that. has negative consequences. So I think it's a really, it's a really, it's very challenging and we're kind of in that. That sticky period right now where we have a, lot of very ambitious targets, we still have a, an existing
[00:18:42] we have existing infrastructure that. can't just overnight be replaced.
[00:18:47] So how do
[00:18:48] you kind of. It's about what I use, what I tell my students is about coexistence right now, is how do you sort of build in more new energy technologies or more renewable energy, while at the
[00:19:01] same time, you're not completely eliminating the existing energy as you're trying to reduce them, but For the moment, we're not seeing real reductions in hydrocarbons.
[00:19:13] We're seeing additions, more different types of energies, if
[00:19:18] So it's interesting from, what I understand, please, by all means, correct me
[00:19:22] if I'm wrong. I understand that the global economy has
[00:19:24] been 85 dependent on fossil fuels for the last 50 years.
[00:19:30] So this question, am I right? It's 85%, right? And that's where we are today. So this idea of, being the way that you're talking about this evolution versus a revolution, integrating renewable technologies into, our economy, into the marketplace sounds really interesting.
[00:19:49] But, you know, Again, you struck a little fear into me because you spoke about, perhaps, you know, a marketplace collapsing as a result of accelerating too quickly or pulling fossil fuels out of the marketplace too quickly. Does, you mentioned, like, for example, not having lighting, does that then go into ideas of, like, heat and air conditioning for the elderly, you know, preserving food supplies?
[00:20:18] Does it get into the issue of moving goods that are critical for hospitals and other infrastructure related topics into play, like what, is the downside if we, revolutionize and, pull fossil fuels out of the marketplace quickly? What
[00:20:37] I do not support the energy transition and the move towards reducing hydrocarbons across the energy system, um, systems. I think the issue is, that, if you think about security? So I think a lot about energy security. So if you think about
[00:20:54] security, you need accessibility.
[00:20:57] So you need to have enough supply to meet demand. And ideally it's affordable, right? So you want affordability, you want accessibility, you want acceptability, right? So you also want it to be acceptable by. the users, of the energy, and there's you know, the issue of sustainability and the
[00:21:18] environment. if you were to pull again, you know, 80 plus of global energy still comes from hydrocarbons. If you were tomorrow to take 20 of that energy offline, force it offline, that's going to be disruptive, right? That's absolutely going to be Very disruptive if you don't have the alternatives
[00:21:44] to replace and to do all the things that are currently done with the sources of energies that we have.
[00:21:52] So that's the part that's the delicate
[00:21:54] balance.
[00:21:56] So what's feasible, like what's the time, the
[00:21:58] feasible timeline, Carolyn? I'm sorry to interrupt you, but like, so do you think
[00:22:01] like, by 2050, we can live in a world where
[00:22:05] the, there it's the end of oil effectively, or
[00:22:08] like, what do you think is a feasible, you know, horizon,
[00:22:11] I have a couple of different tapes on that. So I do think by probably about 20.
[00:22:18] Millili,
[00:22:21] will start to see a you know, we will start to see that decline overall, maybe even a little bit before 2035, but in the Overall demand for oil for the next few years, we're going to see an increase and that's not driven by the United States.
[00:22:45] It's not driven by Europe. It's driven by other
[00:22:47] developing countries that. Still are developing economically, they're still sort of thinking about a hundred percent accessibility to
[00:22:58] electricity. so I don't see, I don't see zero. I don't see a mark. All of like, I tell
[00:23:10] my students, and it's a great exercise for your listeners is like, just stop and look around.
[00:23:17] Like, if you just look around. it is very, difficult to not find oil, right? To not sort of connect, whether it be, this plastic, or whether it, be, you know, how your phone, for example, goes from, you know, The, various, you know, factories that, that make it, but then how it gets moved, right?
[00:23:45] Trucking fleets are predominantly still gasoline. So, petrochemicals, fertilizers, it's just pervasive. So petroleum products are pervasive. Oil consumption is pervasive in our economy, economies. So, I don't see zero. I don't see, zero. I see lots of changes in how we think about oil, but I don't see zero.
[00:24:12] proportionality then, right? It's like the ecosystem that we
[00:24:16] mentioned earlier comes into play and the renewables will go
[00:24:19] from a smaller proportion of the pie.
[00:24:22] to a bigger proportion of the pie. Is that how you
[00:24:24] Yeah, no, absolutely. I mean, solar is a great example. Like, again, like 15 years ago, people were like, oh, solar is too expensive. It's not, you know, and now you have, it's the most, it's the
[00:24:37] fastest growing source
[00:24:40] of energy addition, right? It's coming from solar and it goes into electricity. Today, you have the price of long storage batteries.
[00:24:50] Are going down. That's a game changer, right? So I think we're gonna see a lot of changes, positive changes towards more renewable
[00:25:01] energy, less overall, a less percentage So we'll see the percentage of hydrocarbons in use, and the percentage in use go down. But it's not going to happen, you know, it's not going to happen overnight.
[00:25:17] So again, it is part of that, I think evolution is a, great word to use.
[00:25:23] it's not a, like, It's not a quick revolution. it's a, it's an evolution where we're
[00:25:29] seeing the sort of the transition is taking place. it's not happening as quickly as. Many people
[00:25:36] want, but we are, we're, if you're in the space, you absolutely see that there's more of different types of energies that are coming into the energy space that, that, that affects all of
[00:25:52] us and it affects, you know, you know, in different, ways.
[00:25:57] who would benefit then if
[00:25:59] we see like, I don't want to put words in your mouth because I know, these are like sensitive topics, so like assuming that you're saying by
[00:26:05] 2035 we'll see a peak in the demand for oil,
[00:26:08] gas, and coal, is that fair to, is that what you
[00:26:12] Well, coal probably before coal is probably going to be like. I mean, it's again, there's lots of issues as to why we've seen an increase in coal or especially over the last few years. And again, much of that is in the,
[00:26:26] what we call the developing world,
[00:26:30] So, So, if we
[00:26:31] more coal consumption.
[00:26:33] Yeah. so if we see it peaking out, let's say we, it hits a peak because now we have,
[00:26:40] maybe electronic vehicles are ubiquitous and these other topics that you're raising, let's say it's 2035,
[00:26:47] then who benefits economically? I think there's going to be like a very interesting shift as it relates to the corporate landscape.
[00:26:54] Right? So, who in your mind do you see, doing things the right way now that will really have a significant benefit, economically as it relates to corporations in this space in, in, you know, effectively 10 years from now?
[00:27:12] Yeah, so I think a lot of companies have embarked kind of on a sustainability journey of sorts, right, where they're looking at their supply chains and they're looking at, you know, we also have a lot more regulation around,
[00:27:28] disclosure. Especially here in the United States and very, much
[00:27:32] in Europe.
[00:27:34] So companies are saying, okay, if it's going to be more expensive because of regulation and because of new laws, that, you know, reducing the amount of hydrocarbons that get used, reducing, you know, emissions across the supply chain is going to be a net benefit, not only for meeting requirements.
[00:27:54] Requirements
[00:27:55] and new regulations, but also, you know, reducing some of the insecurity
[00:28:01] that we can see in the geopolitics of
[00:28:05] the more traditional energies. which companies, I mean, again, I, you know, for the, hey. You know what, this year, the last two years, which, you know, 10 years ago, five years ago, a lot of people said, you know, companies like ExxonMobil companies like Chevron and, you know, these companies were kind of like the, going to quickly be the dinosaurs.
[00:28:29] And we
[00:28:29] saw that in terms of the S& P that the, that their positions. We're in decline. The last two years blew that whole idea up. And so you've had some more of the traditional oil and gas companies that have had an excellent two years in terms of stock value,
[00:28:51] in terms of overall corporate earnings. Is that going to be the case 5 years from now?
[00:28:59] Probably not. But, you know, again, some people didn't see the last 2 years either. so I think it's going to be like, I think, you know, I think you're going to see a lot of, like, companies that some will sort of have these, you know, moments of,
[00:29:13] like, they're on the upswing and, there's, just, you know, in my, in the way I look at like, Ørsted, I took students to Denmark in 2019.
[00:29:24] Ørsted is this,
[00:29:25] you know, really dynamic, renewable energy company, focuses a lot
[00:29:31] on offshore wind. They basically took their whole portfolio, which was, had been fossil because it was Danish oil and natural gas. They renamed it to Ørsted and they went, you know, they went, they said, you know what, the world is moving.
[00:29:49] We're going to be a leader
[00:29:51] That's fantastic. so
[00:29:57] the first thing that you saw? Well, I think that the market's been really bad for offshore wind. The inflation has hurt offshore
[00:30:03] wind. Supply chain issues have hurt offshore wind. So Ernstead,
[00:30:06] which was this kind of like shining light of a company, has seen a reduction in the stock value.
[00:30:13] It's hit a lot of roadblocks, right?
[00:30:16] one second.
[00:30:25] of the transition is that you're going to
[00:30:27] have companies that are going to sort of see these, like, kind of waves.
[00:30:33] And then, you know, again, I think
[00:30:35] if you are going back to your daughter, right, So your daughter clearly sounds like she cares
[00:30:42] about the planet. So as she grows up,
[00:30:47] right, what is her, how, what kind of a consumer is she
[00:30:50] going to
[00:30:51] be? Like, is she going to be a consumer? And
[00:30:53] it's like, well, wait a second, you know, I'm buying This,
[00:30:58] piece of clothing, or I'm, you know, when she eventually, I'm sure you and your wife will get nervous, but it's when she starts to drive and she's thinking about like, what kind of car is she going to buy? Like a lot of that is like, we are seeing young people and their consumption choices and how they think about,
[00:31:15] you know,
[00:31:16] the, who the company is, what is the identity of the company in terms of what kind of like. How are they thinking about their stewardship, you know, in terms of corporate
[00:31:28] stewardship I think that's starting to change in ways that I think probably hard to sort of know what that's going to
[00:31:35] look like in 10 years. But I do think You're seeing corporate stewardship play in some different areas and some
[00:31:45] companies do it well, some companies greenwash, but I think you know, I think the companies that are doing it
[00:31:53] and are truly it's value oriented, it's purpose driven, are not going to move away because there's a hiccup.
[00:32:01] They're going to, this is like their, this is their commitment. This is part
[00:32:05] of the, you know, they're kind of, it's built into the mission as how they think about their,
[00:32:10] Elizabeth
[00:32:11] whatever it is that they're bringing into the market. So I think it's a fascinating, I mean, it's a fascinating time for companies.
[00:32:19] It's challenging time due to like, you know, volatile economic environment, but also, so I think you're seeing a lot of different approaches to, companies think about sustainability.
[00:32:33] Carolyn, who do you think will get us there on a global scale quicker? Will it be governments or will it be private
[00:32:41] businesses, entrepreneurship, these types of individuals that are in the business? Sector that you like. To your point, you said like these people are committed, whether it's for social reasons or for profitability, they are driven, they're in it, they are experts on it.
[00:32:55] They're probably, in many cases, more of an expert than you might find in, you know, the government. So, who's gonna get us there quicker? Is it gonna be the private sector or the public sector?
[00:33:06] I think they need each other. So I think the government, governments can help. By kind of creating a more enabling environment, right? Both on the policy side, but also. reducing some of the, the time lags, right. That it takes, so Reducing some of the,
[00:33:27] roadblocks that are in place
[00:33:31] around moving change forward.
[00:33:33] So I think governments are really
[00:33:35] important, but I think ultimately, the private sector is critical. So, you know, you need companies that say, okay, you know what, we're we. We're going to build, we're going to, we're going to, we're, going to be the developers and We're going to be the, the implementers. we're going to, be the, you know, the installers of solar energy. we're going
[00:33:58] to do, you know, wind. We're going to do these things. but again, producing solar panels without being able to also then, you know, know and have confidence that there's going to be the transmission lines and all these different kinds of things.
[00:34:14] That's more in the government
[00:34:17] space for around the permitting. And the permitting that's required. So again, it's a, very delicate dance, but I would say it's not going to be one or the other. It has to be both end, because companies will come into
[00:34:33] like, you know, they'll be butting heads if the governments are not if there's not an agility between the two, that they can work together To move, especially around the energy transition
[00:34:48] so I have to tell you, like,
[00:34:49] you're like, as you're speaking, you're kind of changing my mindset about, like, corporate
[00:34:53] greenwashing, for example. Because I think there's also a delicate balance between creating value for the shareholder and taking steps in the right direction so that you could positively impact the environment. I was going to highlight a couple of acquisitions that were done here in the United States as examples of corporate greenwashing, but maybe it's just a necessary evil until we shift, you know, until we get to 2035 or so. So, the two big events in October. That I was going to highlight from our energy sector was ExxonMobil's acquisition of Pioneer Resources for 59.
[00:35:30] 5 billion, and Chevron's acquisition of Hess for 53 billion, the results of which, as you know, impacted, it boosted their reserves, it, impacted their market positions, it touches on geographic security from a commercial perspective, and, You know, it seems like you could tie the banks into those topics, too.
[00:35:55] Clearly, I did my homework, thanks to you. right? I
[00:35:58] Oh, so very good, Mark. I'm very impressed.
[00:36:01] But I didn't even make the, I didn't even make the connection to the banks because the banks involved like Citi and Goldman and Morgan
[00:36:07] Stanley, by underwriting these acquisitions, perhaps they're guilty of greenwashing too. so
[00:36:14] can you just talk to that issue a little bit?
[00:36:17] like, are these good acquisitions for American companies? Are they necessary at this point? Like they might actually be necessary as they, as these companies transition towards renewable, like what's the actual story here?
[00:36:30] So, again, I mean, there are stories, depending on who you ask and how they look at this and the perspective that they take on this. These are, regardless, these are still these companies, you know, Chevron and ExxonMobil. They Are
[00:36:50] predominantly traditional energy companies, meaning that the bulk of their portfolio exists in the hydrocarbon space, right?
[00:37:00] So this is a hydrocarbon play, right? for both both. companies, ExxonMobil, get, you know, buying Pioneer, very much of a, what we'd call a Permian play, and the Permian in Texas is a prolific, source of oil, some of it is shale oil. so this is, you know, this is
[00:37:24] strategic. This is also sort of saying, hey, this is, you know, proximity matters, right? This is, U. S., so it's not. Exxon Mobil going out and buying a foreign acquisition. So going sort of beyond U. S. borders. so it's within the United States. This is, these are two
[00:37:44] U. S. companies. yeah, so it's reserve driven to add reserves to the, To the overall sort of company profile, but it's also strategic, right?
[00:37:55] Because
[00:37:55] it's a little, you know, we're seeing some consolidation, which I think is, you know, kind of part of kind of the evolutionary process for, Chevron, I think it was kind of multi pronged, I mean, for both, I would say it's multi pronged. It's, you know, part of it is the Bakken in North Dakota.
[00:38:14] Part of it is Guyana. again, this is about adding some reserves. This is about sort of like a little bit, we would call it a little bit diversifying the, the oil portfolio for both companies. I think it's also an acknowledgement. Again, it's an acknowledgement. that the United States consumes almost 20 million barrels of oil a day. We produce almost 12 and a
[00:38:46] half million barrels a day. We still import oil. We like. There's just this,
[00:38:53] like, the world is, again, going back, the world's not going to zero. So, there is, this, there is, I think, you know, these are private companies. So we don't
[00:39:03] have national oil companies. If you go to Saudi Arabia, Saudi Aramco is a national oil company. But this is also sort of, like, you know, This is saying, okay, what is going to be the US position as the world's largest oil and natural gas producer,
[00:39:20] Most people in the United States have no idea that the United States is the largest producer, produces more oil than Saudi Arabia,
[00:39:29] produces more natural gas than Russia, produces more oil, natural gas than Russia and Saudi Arabia.
[00:39:35] Like it's, you know, this is my take and this is my argument that I'm also kind of really giving a lot of thought to.
[00:39:43] We're seeing, as much as you can, this is maybe greenwashing, but we're going to see the decarbonizing of hydrocarbons.
[00:39:54] We're not seeing the elimination of hydrocarbons. We're seeing the decarbonization of hydrocarbons. So companies that are investing in carbon capture, companies that are like building out a lot of efficiencies in their production to say, how, where can we reduce emissions? You go to Norway. You go to Norway's oil
[00:40:21] production, which is, you know, one of the reasons
[00:40:23] why Norway is as rich as it is,
[00:40:27] because of their hydrocarbon production. But if you go to offshore oil in Norway, it's being powered by offshore wind, right? Like, so how you have this kind of integration, I think is something that's like, I think we're moving into a very unique, like a very interesting
[00:40:45] period where we're seeing.
[00:40:50] Traditional energy companies, especially the ones that have a bigger sort of name, meaning that they're more recognized, are saying, listen,
[00:41:01] actual
[00:41:03] no one, is going, no one wants to live without oil for the time
[00:41:06] being, because it's so integral to our economies.
[00:41:10] So We'll reduce the carbon emissions and we'll be a better, we'll be a better steward as a, as a corporate, as a corporation, kind of responding to demands, responding to sort of shifts in, in regulation and responding to,
[00:41:28] you know, so there's a lot of things that are up.
[00:41:30] It's really, It's actually really fascinating. I think I was reading about a company based out of the San
[00:41:35] Francisco area that's doing exactly
[00:41:37] what you're talking about, like decarbonizing fossil fuels. I think the company might be called Valor, I could be mistaken. it sounds like they're still very early on in the process, but apparently they've received just a ton of, funding from, private equity and VC firms.
[00:41:54] it's an American based company, so like, if, we were able to decarbonize fossil fuels, would the fossil fuels still provide a better source of energy renewables? So, would the fossil, the decarbonized fossil fuel approach be better than the renewable approach? Do you see my, distinction there?
[00:42:16] totally see your point. And I'm going to say
[00:42:18] it's both. It's not either or. It's not like one is better than the other. We need to have both for the time. Like, we need to have both. We need to
[00:42:26] have a lot more. we
[00:42:28] need to have a lot more renewable energy coming into The, picture. We need to have
[00:42:32] less emissions coming from the hydrocarbon space. Here's the issue though. And I think this is for your
[00:42:36] audience. This is the most,
[00:42:38] this is the most interesting. Do some of these changes absolve The, oil and gas companies from their
[00:42:49] responsibilities to, to kind of start to eliminate hydrocarbons. Are we kind of enabling the continued use of
[00:43:00] hydrocarbons via these different integrated technologies like CCUS
[00:43:06] and these different things.
[00:43:07] So it's both, is it in effect giving them a longer runway? And that's what a lot of critics say that by. Not saying no, you can't purchase Pioneer And no, you can't purchase Hess and that the United States should Not be approving like the Willow Project and the United States should be, you know, the government should be doing
[00:43:34] like sort of stopping some of these deals from going forward if the real commitment is to reducing
[00:43:40] fossil fuels.
[00:43:42] But, then how do United States corporations then compete with like state owned, and like fuel, fossil fuel entities, like, just to segue into,
[00:43:52] for a minute, because it's, you know, it's,
[00:43:55] Basically now, I'm going to read to you a document that was obtained by Politico surrounding, the UAE's, Sultan Ahmed Al Jubeir, who's the president designate for COP28, which is in the UAE.
[00:44:11] It reads, the United Arab Emirates is using its leverage as an oil producer and host of the upcoming United Nations climate talks to prod some of the world's most secretive state run oil companies to reduce their greenhouse gas emissions. But the effort has already been dismissed by environmentalists who have been critical of Sultan Al Jubeir.
[00:44:32] I hope I'm pronouncing his name correctly. The head of this year's Climate Talks and chief of UAE's National Oil Company. He has proposed using the sector's deep pockets to clean up petroleum production rather than quickly ditching fossil fuels. So there's like a great example where, you know, maybe it's a little bit of greenwashing and maybe it's also giving the state owned oil company a competitive advantage over entities that are U.
[00:44:59] S. based like Exxon Mobil. And, other companies like this. So what do you make of that?
[00:45:08] you know, the thing about Al Jubeir, so he's the CEO of ADNOC, right, which is a UAE, very large, traditional, predominantly hydrocarbon company, but before
[00:45:19] this, he was the chair of MASTAR, which is the world's largest renewable energy company, right?
[00:45:24] So he, in some ways, he's It's very like, he kind of, it's hard to find someone who kind of has worn both hats so significantly in the energy space. So my take, which again, maybe is counter to a lot of the, to date is that this is actually going to be one of the more positive, conferences, and that it's probably going to have. I would argue probably the, some pretty, not a lot, cause it's really hard when you run these like very large international conferences, but I think you're going to have some agreements that are going to be meaningful and that are going to have some meat. On that, maybe meat is a really bad one because, meat methane emissions, but regardless, like we, I, so Al Jaber, here's his take.
[00:46:26] His take is we, live in a complex world that still uses a lot of hydrocarbons, right? The world is going to continue to need hydrocarbons. That hydrocarbon companies have a responsibility to reduce emissions. How do we help to commit to As hydrocarbon producing companies how do we reduce emissions from our, so the companies that can reduce their emissions will be the companies that thrive and survive.
[00:46:59] Right? so I think there's that take. And I think the other thing is that the UAE is not quickly, or no countries in the Gulf are going to move forward.
[00:47:14] away from hydrocarbons. Their budgets are so deeply
[00:47:18] tied to hydrocarbons. They're not diversified enough,
[00:47:23] In
[00:47:24] they also are very wealthy. So they have a lot of money and they want to be, they want to be significant on the global stage
[00:47:36] for
[00:47:37] Being leaders and not just leaders associated with their energy production, but also in terms of leadership in terms of actually moving,
[00:47:47] you know, moving change forward. So what I think is going to happen in the UAE and what's
[00:47:53] going to happen in Dubai is Al Jubeir, one, it's,
[00:47:57] I think last year was the most.
[00:48:00] You've never had more oil and gas companies represented. This year is not going to be different. You're going to have a lot of energy companies that are going to, be, be in Dubai in addition to a lot of non governmental organizations in addition to all
[00:48:18] the various countries, the large emitting economies, the small island states, the very vulnerable and very volatile, countries that are really impacted by climate change in a way that it's really hard for us to understand.
[00:48:36] so
[00:48:36]
[00:48:36] think there's going to be a kind of a, the methane emission pledge that has more on the natural gas side. I think it's going to be more firmly put into
[00:48:47] place. I think you're going to
[00:48:49] have a kind of a. this idea that, okay, as we continue to use hydrocarbons, we're going to commit as companies and as national oil companies to reducing our emissions.
[00:49:00] So we're going to sort of take a very strong
[00:49:03]
[00:49:03] technological hammer to our production to reduce it. And the other thing is, you mentioned loss and damage, that the UAE is my guess. This is my guess. I'm not, I have no. No
[00:49:14] information on this. The UAE, there's going to be a big
[00:49:17] fund, bigger than what was pledged.
[00:49:23] So there's a hundred billion that was pledged. We still have yet to sort of meet that target. I think the UAE is going to, actually announce a very large
[00:49:34] pledge
[00:49:34] That's really interesting. So, like, just to close the circle with regards to Aljabeer and Adnok, because it's exactly what you
[00:49:40] stated. he, set goals for Adnok to eliminate emissions of potent
[00:49:46] greenhouse gas methane by 2030. but the company also wants plans to spend 150 billion expanding oil and gas capacity, in a country that's already the world's seventh largest producer of those fuels.
[00:50:01] So literally, it's exactly what you said. as it relates to, just to segue into, this, first ever Climate Loss and Damage Fund. at COP27 this was a historic agreement to establish a loss and damage fund to help address extreme climate in low income, low emitting, climate vulnerable countries, which is really interesting.
[00:50:24] And it really does tie into a lot of what we're talking about today, Carolyn, as it relates to, you know, essentially like the haves and the have nots. So UAE would come out and say, here's a huge pledge towards it. But We're already seeing, you know, an inability for the countries of the world to donate to that fund.
[00:50:45] They were supposed to put money into that fund shortly after, establishing it. But yet here we are a year out, and we've seen torrential rains created flooding that swept away an entire city in, Libya. We've seen wildfires. Raise swaths of Greece and Canada and obviously Maui. the leaders surrounding this loss and damage fund have met four times, but there's not been any specific, financial pledge towards the fund yet. the United States has said, John Kerry has said that we're going to come out and put a significant amount of money into it. The European Union is saying the same, although. I know that, some elements, like the United Kingdom has come out and said, like, whoa, we can't afford this anymore. So if, the, if Al Jaber and the UAE come out and make this huge pledge towards it, it's really interesting. what do you think the impact will be for these other countries? Will they follow his lead? is it something that's sustainable as it relates to this fund? how impactful could they be to help these? nations that, you know, really are, getting, I think, the short end of the stick as it relates to, climate change caused by some of the bigger, you know, manufacturers on the planet.
[00:52:02] so whatever the fund is, whatever the final amount is, there's the, what's committed. And then there's the, what is in terms of what actually will go into the fund. and the reason why I
[00:52:16] think the Algebra is going to, I think that's part of, I think that's already in place. Play that will in a little bit way of shaming the large emitters to say, you know, if the UAE is putting a big chunk of money towards the fund, then the larger emitters, the United States and China should also follow suit.
[00:52:35] And that they're going to be held accountable for meeting their, for meeting their, The pledges that they, make. That's been the issue. the pledges were made, but they, the financial, the numbers, the money has not actually come in, to The point where it was supposed to. so the reality is the fund is a drop in the bucket. the fund is, you need we need trillions, of dollars going towards this, like in terms of when you look at the most vulnerable countries for not just. Again, mitigating, which is reducing the carbon emissions, but adapting to, you
[00:53:08] just gave those multitude of examples in Libya and Maui and Pakistan.
[00:53:14] And you name, you know, there's very, there are very few places in the world that have not seen
[00:53:19] the extreme impacts. Right? So we need to really be also lost And damaged. It's also thinking about how do we, like, how do we think about
[00:53:28] adaptation? Right? Because anything we do today is. We're not going to see the, carbon emissions that are in the atmosphere are there unless
[00:53:39] we can, you know, remove them. But this is like, even if we went to zero tomorrow, which We're not going to in terms of emissions climate change is still, we're still going to see the
[00:53:50] impacts of it. And that's just. You know, the science tells us that. So I think the loss and damage fund, again, Al Jaber is going to say, here it is. It's you know, I'm kind of thinking about like, I don't know, maybe if you're in like Las Vegas or something, or you're somewhere you're, you know, someone's, you know, an auction, you really want to get someone who's going to put the money up a big amount that then sets the tone for others to follow, say, listen, you know, I'm.
[00:54:16] Here I am, I'm gonna, I'm putting my money and that's going to, and so UAE is going to do that. They're going to put a lot of money on the table. There's going to be a fund that's going to be bigger than what even was, it was discussed. And. Then it's going to be up to other countries to sort of
[00:54:35] follow suit, but I do think that's going to happen. And, here's my take. So I was in, this is going to be funny, I was in Doha in March. Qatar had hosted the world cup,
[00:54:49] right? A lot of, there was a lot of criticism of Qatar hosting the world cup, There were A lot of, issues around human rights, a lot of issues around, you know, the, I think overall it proved to be a success was I think the final take was that they managed it. People who attended were pretty happy. There were, you know, so it ended up being a success in a way that a
[00:55:14] lot of critics didn't think it was going to be.
[00:55:17] So the same idea. A lot of the criticism around Al Jair, being the chair of COP 28 and this happening in what is called a petro state, the UAE, I actually think There's the counter is going
[00:55:33] to be the case that it's actually going to be a success. and partially because they are so committed to it being a success, they
[00:55:40] are. Going to make sure that youth organizations have, a place and have a voice. There's just going to be, they're rolling out everything that they can to ensure and to enable a COP 28. That's not going to be a failure. Copenhagen in 2009 was an absolute failure.
[00:56:04] COP 28. As hosted by the UAE, will not be a failure.
[00:56:08] They're going, I don't know everything they're going to do, but I can, I'm going to put my, like, my, like, I'm saying that I believe it's going to actually
[00:56:18] come out and be one of the more successful. Will it be as successful as Paris? Because you had a pretty big agreement coming out of Paris in 2015. I think it's going to be a different.
[00:56:28] type of success, but I think it's going to
[00:56:29] be very
[00:56:30] So it's interesting, like a standard for success before, nations start executing
[00:56:36] on their plan is international cooperation. And I wonder in your opinion, like which policy or which international agreement has been the most effective in galvanizing the international community to combat climate change?
[00:56:53] I mean, we've had you know, the Kyoto protocols, we've had things that have gone into play where we see hydrochloro like we've seen chemicals and substances that no longer, that are prohibited globally. Right. I think the methane pledge is going to be
[00:57:12] pretty significant in COP28 in terms of when methane is a very, is a very
[00:57:18] toxic, greenhouse gas.
[00:57:21] it's, more
[00:57:22] damaging in terms of, than is, carbon, in terms of, you know, what it does once in the
[00:57:30] atmosphere. but I think, you know, we've had some, we've had some international agreements. that.
[00:57:37] have made, using some chemicals that are deemed toxic, that you know, in terms of the ozone layer and things like that.
[00:57:46] These are kinds of things that we've seen that have been effective. so
[00:57:51] I think that, you know, we have
[00:57:52] some examples. It's just very hard to get. Full
[00:57:56] international
[00:57:56] cooperation, it's possible where, you know, countries don't feel that they are being, kind of put out or displaced by what's getting prohibited. I always, I use a book. I mean, it was written in the 1960s, but Silent Spring by Rachel Carson. And I have students read it one because it's beautiful. It's a beautiful read, but two, it's the power of
[00:58:24] bringing, like making
[00:58:26] the reader aware of, imagine a spring where you don't hear the birds and you don't see the flowers and bloom and, how sad would it be?
[00:58:36] And this book was super, Powerful. One, it was, a series it was had been a series of articles. Then it was the book and
[00:58:44] it was read by John F. Kennedy. And it was it really had
[00:58:50] an impact on, on US policy that it was part of what was a driver behind creating the Environmental Protection Agency was this book. and then you had certain, a lot of chemicals that were used in fertilizer that were
[00:59:04] used, in agriculture and that were used in products that got eliminated, they got basically, regulated
[00:59:12] out of being used and part of it, you know, sort of stemmed from that book.
[00:59:17] So, you know, I think it can be sometimes hard to sort of imagine hard change in terms of imagine what, imagining what it's going to look like, but. I think we've seen, if you really you've seen like different examples where things that were more common 20, 30 years ago, today, you just, as a company, you wouldn't do it because it's, you know, there's, there are laws that were put into place that, You know, there's huge costs to, if you break that law. So I don't know, I mean, maybe I haven't answered your question, but I remain sort of relatively. again, I, don't you know, but when I, by the way, when I said great success, I don't mean that, you know, there's going to be, you know, the day after the end of COP 28.
[01:00:16] That does not mean that we're going to see this like clear decline in hydrocarbon use or this immediate decline in overall global emissions. that's not how I'm thinking of success. I just think you're going to have. agreement that's going to be meaningful and you're going to have some, significant move that's going to be kind of, that would represent.
[01:00:42] A successful conference of parties.
[01:00:45] Yeah, it's really interesting how, energy and technology are, shaping the geopolitical landscape. But really, at a deeper level, it's humanity, it's humankind. So, you know, you've been really generous today. You've given us so much insight, and so much of your time, and I appreciate it. But, I can't let you go just yet.
[01:01:08] I think you just set me up for a good segue into what we do with each guest. At the end of each show, we ask each guest to finish a sentence that I set up for them that ties back to the show's title, Some Future Day. So, my, set up for you is, which you just inspired two seconds ago, is in some future day, technology will have an impact on the way that societies function, specifically by changing.
[01:01:42] by changing our, the way that we use, consume, energy. And I think your people are going to have a lot more, depth of understanding as to their own consumption and
[01:01:55] you know, that. we're, going to, have much more granular data that's
[01:02:00] going to be able to help to, help, countries to better prepare for,
[01:02:08] I agree, for sure. In fact, artificial intelligence is already driving, towards that
[01:02:12] initiative. It's, really interesting. I guess we really didn't have a chance to address, cowflagellation
[01:02:18] today. farts.
[01:02:23] Oh, cow farts. Oh, the methane emissions.
[01:02:25] Yeah, we
[01:02:26] touched on methane emissions, but we didn't get to, like, really talk
[01:02:29] about that. So,
[01:02:30] So one of my students is actually, that was her. she wrote a piece saying that she was, COP28 should not, they should not serve meat because
[01:02:39] of again, the negative
[01:02:40] right.
[01:02:42] that, yeah. And so, but meat is on the, meat is on the menu for
[01:02:46] COP28. So
[01:02:48] she's like, climate change talks And then, you know, meat on the menu?
[01:02:51] That's like, kind of, that shouldn't be the case.
[01:02:54] Yeah, it's tough. I mean, you know, the naysayers try to,
[01:03:00] poke holes in every aspect of it, but to your point, it takes time. There's an evolution. It's easy to point out how people are, arriving at the event, you know, what mode of transportation, what they're eating, like you could poke holes all over the place, but, you know, fortunately we're taking some steps in the right direction.
[01:03:21] I would like to believe so as a mother of, you know, two boys, I really hope that, you know, the things that we're doing today that they see and that they experience in a positive way, that it's not, that we're not continue, that we, don't, So I'm going to end on that note. So for having me.
[01:03:46] It was a great conversation. I hope it's been helpful.
[01:03:51] And I'm
[01:03:52]