Biden can help the world avoid energy wars of the future
Among the biggest promises of the Biden campaign is the commitment to fight the effects of climate change by turning the United States entirely green by 2035.
Biden’s energy plan will cost $2 trillion and includes heavy investment in renewable energy, overhauling the American grid, and emphasizing conversion to electric cars. The agenda is not “anti-oil”— Biden would not ban fracking, for example.
But Biden, who introduced one of the nation’s first major pieces of clean energy legislation way back in 1986, is promising to go further than President Barack Obama’s Clean Power Plan. In terms of clarity, the Biden plan is light years ahead of the Trump administration’s “Energy Dominance,” which has focused on opening up federal lands and encouraging shale drillers to maximize output, despite the sector’s failure to sustain a profit.
The Biden plan ranks among the most ambitious energy agendas in American history, rivaling “Project Independence,” President Richard Nixon’s audacious (and ultimately unsuccessful) effort to wean the United States off imported oil and end the threat of embargos by the Organization of Petroleum Exporting States.
Yet the Biden plan is compelled by a threat more existential than OPEC. The immediate and catastrophic nature of global climate change has made the energy issue one of paramount importance. In addition, the falling cost of renewable energy technology, high-capacity batteries, and electric cars has put economically viable solutions to reducing carbon production within reach.
Biden’s plan might look expensive. But it is feasible given the resources now at hand and necessary to slow the devastating effects of climate change in the near-term.
When it comes to energy, domestic issues run parallel with international concerns. While the Biden energy plan offers the United States a potential roadmap towards greater energy security, the appeal of “energy independence” may encourage some to view this as a moment for the United States to turn away from the broader world of global energy.
That would be a mistake. A Biden administration will face a transforming global energy order, one that will require dynamic yet restrained policy solutions.
First, the United States will need to reconsider its relationship with the oil producers of the Persian Gulf. The United States is no longer a major importer of Saudi Arabian crude, though the U.S.-Saudi relationship has long been predicated on the exchange of energy for security. More recently, Riyadh and Washington have been united over their mutual hostility towards Iran. Biden has emphasized his desire to return the United States to the Iran nuclear deal, a commitment sure to anger the Saudis. As the United States commits itself to a clean energy future, it will necessarily distance itself from the world’s top crude exporter, which has proven to be an erratic and impulsive partner.
Such a shift is warranted by the shifting conditions of the global oil market. Oil prices collapsed in 2014, and after anemic growth fell once again in early 2020, due both to the coronavirus and an ill-timed oil “price war” launched by Saudi Crown Prince Mohammed bin Salman. The United States was a factor in this shift, as it flooded the market with shale oil produced by American companies funded largely from Wall Street loans. Collapsing prices have produced a crisis for the oil world. Oil exporters like Saudi Arabia face historic economic constraints as they grapple with prices that will remain lower for longer and demand that is likely to stagnate or fall as the world’s consumption of petroleum surpasses its peak. The Gulf’s oil monarchies will have to reform their economies. This offers the United States a pivotal opportunity to re-define its relationship with Saudi Arabia and other oil-producing states.
Second, a Biden administration must work to limit global competition for energy resources. This includes the new and escalating competition for natural gas and oil in the Mediterranean. Since the discovery of the Leviathan field in 2009, a series of major discoveries has triggered a regional “gold rush,” as states race to lay claim to natural gas deposits buried under the sea. Key players include Israel, Egypt, and Turkey — all major energy importers — and has sparked intense regional competition and lately a French intervention.
The participants have staked out dangerous ground and the chances of a general conflagration have grown. Turkey’s ambitions are closely linked to its growing desire to become a natural gas producer, ambitions which a recent discovery in the Black Sea are sure to feed. It is also actively engaged in carving out a special sphere of economic influence in Libya, where oil production has been periodically shut-in since civil war broke out in 2011.
There are historic grievances at play here. But the activity of regional actors is also linked to the continued desire of energy-importing states to secure their own domestic sources of energy. European consumers anxious to wean themselves off Russian crude and gas are looking for a lifeline. The issue is receiving a lot of attention in the European Union, which is holding an emergency session on September 24 to discuss the issue. In addition, there is a broader sense that the region has become more unstable. The United States appears disinterested in regional affairs and ill-equipped to manage a diplomatic solution to the energy competition, even as it maintains soldiers in Syria to “guard the oil.”
Oil wars have been rare, common perceptions to the contrary. Yet the scramble in the Mediterranean portends a world where competition over energy resources is more fierce. The United States has a role to play in preventing new energy wars from breaking out. But part of that role is encouraging a general global shift away from fossil fuel consumption.
This is the third element of a Biden global energy policy: a renewed and vigorous commitment to clean energy worldwide. Progress was made in this direction under President Obama, through the completion of the Paris Climate Agreement in 2015. That agreement was neither binding nor particularly ambitious: few states have reached their Paris goals, while the United States formally withdrew from the agreement under President Trump in November 2019.
Biden promises to return the United States to the Paris Agreement. But he must go further. A Biden administration should unify U.S. allies and partners under a new agreement, one that would include commitments to cutting emissions and boosting renewable energy. The European Union has already embraced such a mandate. Participation by the United States in a global clean energy initiative would encourage other states to participate as well.
The United States is no longer the world’s leading polluter. That dubious honor belongs to China, which also happens to be the world’s leading investor in renewable energy. The United States should recognize China’s contribution to fighting global carbon emissions while taking steps to improve its own position with regards to clean technology, rare earths needed to produce batteries, and other areas where China has pulled ahead. This is a field where cooperation with China — a massive economy that has a major impact on global carbon emissions — will be just as important as competition.
Such a move would signal to institutional investors, organizations, and private enterprise that the U.S. commitment to clean energy is real, significant, and lasting. Major energy companies like BP, Shell, and Total have already signaled their intention to shift to clean energy over fossil fuels. Former titans like ExxonMobil have been dumped by Wall Street, as “Big Oil” loses ground to large-scale renewable energy developers. These are not altruistic moves — they reflect a realization that the money is in clean energy, rather than oil and gas. A move by the United States to invest in clean energy at home and push for it abroad would accelerate this trend.
Such actions are needed in the near term to slow the effects of climate change. Much more must be done — this plan would do little to reduce consumption of fossil fuel-based products like petrochemicals and plastics, for instance. But after four years of “Energy Dominance,” any policy undertaken by a Biden administration that prioritizes clean energy will be a step forward.
A small step, perhaps. But a step nonetheless.