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Energy industry insiders support Elon Musk’s outlook on the renewable energy transition—even if it’s hard to stomach

August 31, 2022, 10:31 AM UTC

Good morning. Peter Vanham here in Geneva, filling in for Alan.

Back in Norway, the ONS energy conference is underway, with many CEOs of energy companies in attendance. 

One clear takeaway from the conference is how divergent the energy prospects for the U.S. and Europe are for the next few winters. While the U.S. is primarily occupied with keeping prices down and limiting exports, Europe and its companies face a tougher time ahead, with winter rationing almost certain.  

“It may well be that we have a number of winters where we have to somehow find solutions through efficiency savings, through rationing, and…a very, very quick build out of alternatives,” Shell CEO Ben van Beurden said at the conference, having voiced similar concerns in July.   

That grim prospect will undoubtedly have a short-term impact on Europe’s growth and competitiveness, with French Prime Minister Elisabeth Borne warning on Tuesday that “companies will be the first hit.” Many American companies won’t be happy with a worsening economic prospect in their largest export market either.  

The energy conference also made clear that—at least in the near term—companies and governments will have to get energy where they can find it, including from nuclear, gas, and oil. That’s vindication for companies such as Shell and TotalEnergies, which invested in both renewable and nonrenewable energy, and for oil majors that made smaller bets on renewables, such as Chevron and Exxon.  

Yet in a survey released yesterday, ONS attendees almost unanimously (95%) voiced their support for a circular economy. Somewhat surprisingly, they also indicated climate change and political instability were greater challenges for the international community than energy security.

The findings point to consensus that the “energy transition” will involve fossil fuels for a long time to come and that it’s possible—if not always easy—to support renewable and nonrenewable sources of energy at the same time. Or, as Tesla CEO Elon Musk said in Norway: “We need to use oil and gas in the short term, because otherwise civilization will crumble.”

In India, one man has already got the message that playing both sides of the energy transition is a winning ticket. Gautam Adani, who built his wealth investing in both coal and green energy, this week became the world’s third richest man and the first Asian with a net worth of over $100 billion.  

More news below.   

Peter Vanham
@petervanham
peter.vanham@fortune.com

TOP NEWS

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Google is refusing to list former President Donald Trump’s Truth Social app in its Google Play store because of its alleged refusal to scrub content like incitements to violence. “Having effective systems for moderating user-generated content is a condition of our terms of service for any app to go live on Google Play,” Google said, adding that it had given Truth Social compliance advice. BBC

Children’s health

Instagram, TikTok, and other social-media apps must be designed with consideration for children’s physical and mental health under a bill passed unanimously by both houses of California’s legislature. It’s not yet clear if Gov. Gavin Newsom will sign the bill, which social-media companies oppose. Wall Street Journal

Private jets

Opposition against CO2-belching private jets is growing, and some are calling for bans—but here’s an alternative idea: turning private jets into a testing ground for green aviation technology (i.e., hydrogen or electricity). Financial Times

AROUND THE WATERCOOLER

The Great Resignation forced U.S. companies to order a record number of robots, by Tristan Bove

Google worker who opposed contract with Israel quits, claiming retaliation and a climate of silencing pro-Palestinian workers, by Alena Botros

The stock market has tanked since Jerome Powell’s Jackson Hole speech. That’s how the Fed wants it, by Will Daniel

BYD stock plummets as investors worry Warren Buffett’s share sale signals his intent to exit the Chinese EV maker completely, by Grady McGregor

The average overdraft fee dropped 11% in the past year from a record of $33.58, but the majority of banks still charge them, by Megan Leonhardt

This edition of CEO Daily was edited by David Meyer.

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