MY condolences to the family of Dante Ang. It was an honor to know him.
Joe Biden’s administration targeted no more hydrocarbons for power generation by 2035. Obviously, his successor Donald Trump reversed that with his removal of incentives for renewables, especially electric vehicles and his bete noire, wind turbines. He then engages in a war of choice that makes the economic case compelling for renewables, and electric and hybrid vehicles. Especially on renewable power, and despite the new but far from insurmountable differences it brings, President Trump’s ”let’s go back to the good old hydrocarbon generated power days” is out of date, though his view has fans here who cannot handle complex change as I have previously noted.
According to Daniel Yergin’s interview on Bloomberg (available on YouTube) on April 22, he laments that only 6 percent of new cars sold in the United States are electric. In Europe, it is about 20 percent. In China, it is over 50 percent. In Beijing, you cannot even register a new car unless it is electric.
As a sideline, if we handle it right, one of the beneficiaries of the shift to electric cars could be the Philippines. Electric cars use three times more copper than conventional cars. We are the second-largest producer of copper in Southeast Asia and can ramp up further if we can get our policies and execution right. If the auto industry, which is a major user of copper, will shift over the next 10 years to primarily electric and hybrid globally, there will be more demand for copper than we are anticipating. Time to develop more production and acquire, and perhaps expand, the PASAR smelter, too. To make PASAR viable, we need to do an Indonesia and some industrial policy by requiring the copper concentrate mined in the country to be smelted here.
What are two other long-term initiatives that we can start in the short term and continue? First, like Biden, make all our power generation nonfossil fuel. That is too much to ask of our leave it to the private sector Pontius Pilate types, but at least apart from what is already in place and approved, make all new power generation non-hydrocarbon. I am happy, as noted by my friend and fellow columnist Ben Kritz, that in late February, the Energy department under Department Circular DC2026-02-0008 requires all prospective renewable energy power plants of 10 megawatts or more to have at least 20-percent energy storage capacity. To the Luddite, renewable energy is tough simpletons, there are difficulties and issues with change and improvement. They just need to be analyzed, understood and addressed. This will lessen the need for volatility in price, and supply of oil and natural gas.
Same thing for vehicles. Electric and plug-in hybrids are now standard and easily available. Even for trucks and railroads. They don’t need to be diesel-powered anymore. Our oil needs would be substantially reduced by our vehicles, including public transport, being charged rather than fueled. While we’re at it, rail is more efficient than buses, and buses are better than cars. As Gustavo Petro, the mayor of Bogota, said, “A developed country is not a place where the poor have cars. It’s where the rich use public transportation.” And the more efficient and broader the public transportation system the better. I ride public transportation exclusively when in Hong Kong and New York. Shifting new energy to renewables also spurs development, and we should anticipate demand, not just meet backlogs, as we leave it to the private sector to raise whether there is sufficient demand for whatever. I am not advocating bridges to nowhere, but I have news for them. A lot of times progress is suppressed because of the failure to anticipate or even meet demand. It is not an accident that we have grown less for decades than our neighbors who build anticipatory and developmental infrastructure and transportation. It was inevitable, and will continue to be so.
From Nobel Prize winner in economics Paul Krugman’s April 14 Substack — ”Donald Trump wants to stop the renewable energy revolution. But he can’t — it will continue to advance around the world because the economics and the science are compelling. Trump can, however, ensure that the revolution passes us by. And the big geopolitical winner from Trump’s hostility to the energy revolution will be China, which dominates the production of renewable energy infrastructure. Furthermore, the China-led energy future will arrive ahead of schedule, thanks to the debacle in Iran...
While China is strong in many industries, it is utterly dominant in electrotech, the cluster of industries — solar panels, wind turbines, batteries and electric vehicles — at the heart of the renewables revolution. Or as the Wall Street Journal puts it, China’s “green industrial complex” rules. China accounts for more than 80 percent of global production in all these sectors with the exception of wind turbines. In the wind turbine sector, China’s share is “only” 60 percent because Europe retains a significant role.
Why does China dominate electrotech? Industrial policy — deliberate government promotion of these industries — is part of the answer. But a key driver of China’s success has been the speed with which the Chinese themselves have been adopting renewable energy, creating a huge domestic market that provides their electrotech industries with big advantages even in foreign markets.”
Then hydrocarbons can be saved for what there are truly best for and hardest to replace — petrochemicals and fertilizers. We badly need both given our religious and ideological versus logical economists and their penchant for praising population growth which they erroneously equate with the fallacious demographic dividend. That is nonsense given our underperforming growth. We cannot properly feed, educate or employ this “bounty.” Never mind, go forth and multiply people without doing the same for food production, schools and jobs. Yet all our successful neighbors did the opposite — reasonable population control and industrial policy which achieved sustained and superior growth to us.
Reality hurts, but let’s not be like the economic ideologues and have the renewable energy revolution pass us by the way manufacturing and reasonable population control did. We can’t afford the economic status quo.
The author is an independent director of the state-run Maharlika Investment Corp.