A theme that emerged from the Feb. 26 keynote session that kicked off MINEXCHANGE, the 2024 SME Annual Conference and Expo, in Phoenix, Arizona, was the pressure that net-zero greenhouse gas emission goals are exerting on the global energy sector and whether it can meet ambitious energy transition targets without compromising on affordability and reliability.

Keynote speaker Alex Epstein, the author of books such as The Moral Case for Fossil Fuels and Fossil Future, argued that net-zero goals have not served to significantly reduce or eliminate the use of fossil fuels, but rather slowed down their growth, which he said is causing a global energy crisis. He referenced California’s power shortages in the last few years as an example, stating that solar and wind farms are not a reliable source of energy.

“The problem with net zero is that it ignores the unique and enormous benefits of fossil fuels,” he said. “The path forward is energy freedom, not preferences for fossil fuels or anything else, but the freedom of all sources of energy to be produced and consumed.”

He argued that fossil fuel use provides more than 80 per cent of the world’s energy and will continue to do so as fossil fuels are affordable, reliable, versatile and scalable, and cannot be rapidly replaced by solar and wind power, or nuclear and geothermal energy.

“Fossil fuels are uniquely cost effective, and that makes the earth a place that’s livable for billions of people,” he said. “A place where human beings can flourish, they can live lives that are long, healthy, opportunity filled. And without cost-effective energy, they can’t on a large scale, and without fossil fuels, we don’t have cost-effective energy.”

He stated that developing countries rely on fossil fuels, and since roughly a third of the world population uses wood and animal dung for heating and cooking, they present an opportunity for people to “flourish on this otherwise naturally inhospitable planet.”

After the keynote presentation, Epstein moderated a panel discussion with Bradford Crabtree, assistant secretary for the U.S. Department of Energy’s (DOE’s) Office of Fossil Energy and Carbon Management (FECM), Jimmy Staton, the president and CEO of Santee Cooper and Jimmy Brock, the CEO of Consol Energy.

Epstein asked the panelists for their thoughts on the industry reaching net-zero emissions by 2050, which he referred to as “the prevailing political goal guiding energy policy today.”

Crabtree disagreed with what he described as Epstein’s pessimistic view of net-zero goals, stating that the industry needs to embrace the challenge.

“First of all, it’s not a policy,” Crabtree said. “And it’s not just political as the question characterized. It’s a metric. And it’s a metric to which we can hold ourselves accountable.”

He added that while it will be difficult to reach net-zero emissions by 2050, it has not served the industry well in the past to challenge decarbonization and contend with the climate science behind it.

“We’re losing an entire generation [of workers]; in fact, we’ve lost two generations of young people around the world, by not embracing this challenge, being optimistic about the technologies,” he said.

He stated that while he does not disagree with earlier concerns raised by other panelists about energy reliability in a world rapidly transitioning away from fossil fuels, he believes that rejecting the net-zero framework means “we’re not willing to tackle the problem. I think you can be in favour of energy abundance, you can be optimistic about technology, and still get to net zero.”

Santee Cooper’s Staton expressed uncertainty about the ability for the company, which is South Carolina’s largest energy provider, to reach net zero by 2050, stating that while it is an aspirational and laudable goal, he does not currently see the path to reach it with existing technologies.

“What I do know is between now and 2035, Santee Cooper is going to reduce our emissions by 55 per cent. And after that, I’m uncertain,” Staton said. “What I’m afraid of, by setting it as a hard goal for any organization, [is] will you do anything to make it happen? Will you sacrifice affordability? Will you sacrifice reliability?”

Brock, who heads up the coal producer and natural gas company Consol Energy, described net-zero goals as “somewhere in the middle to dangerous.”

He said that the U.S. has significantly shifted away from coal-fired generation in the last decade—in a 2023 report, the Institute for Energy Economics and Financial Analysis stated that the country is well on its way to closing half of its coal-fired generation capacity by 2026—and that he is concerned about the timeline to net zero.

“The fast pace that we’re trying to do this, this is where I think it’s very dangerous,” he said. “We could very easily lose our competitive advantage.”

As an example, he pointed to China dominating the global supply of critical minerals, and said that if the U.S. has an unreliable energy grid and is forced to increase the cost of electricity, it will give China another advantage over the country.

He added that net-zero goals do not allow time for the U.S. to supply the critical minerals needed for the energy transition, as it takes decades for new mines to open.

“Where this becomes dangerous is, what do we lose in the meantime?” he said. “If we lose 40 to 60 per cent of our coal-fired generation here in the U.S., I do not see how the grid is going to function as it is today. And to me, it’s a real danger of moving too fast.”

Epstein concluded the keynote by stating that “global energy abundance” by 2050 should be the industry’s goal.

“That matters a hell of a lot more than how much CO2 is in the atmosphere,” he said. “Because with energy, you can deal with just about any amount of CO2 in the atmosphere. And without energy, it doesn’t matter how much CO2 is in the atmosphere, because life sucks. So instead of allowing it to be framed as, ‘When exactly do we get rid of CO2 emissions?’ let’s frame it as, ‘energy as the most important thing. Let’s bring it to everyone.’”

The U.S. government has committed to having all of its electricity needs coming from carbon pollution-free sources by 2030, with at least half coming from clean energy produced in the country.

The Canadian government has committed to reducing the country’s emissions by 40 to 45 per cent from 2005 levels by 2030, with the goal of reaching net zero by 2050. It pledged to phase out coal-fired power by 2030, and Alberta will already reach this goal sometime this year, according to the province, which forced operating mines to close earlier than planned.