The Death of the Fossil Fuel Industry
The massive reduction of the cost of solar and wind power and utility scale battery storage has sent shockwaves through the fossil fuel industry, particularly the coal industry which supplies around 80% of the worlds electricity. In North America for example the coal industry has lost about 90% of the share market value because investors can clearly see the writing on the wall due to the explosive growth of natural gas power plants over the last decade or so.
Investors have walked away from the coal industry because they see no future in it. The Natural Gas Industry there’s also threatened with the same result, due to the exponential reduction in cost of solar and wind power at the utility scale.
Most of the oil industry who’s blind to the development of solar and wind, and the forecasts coming out of the industry show that they think that they have many decades of healthy oil sales ahead of him. What the oil industry does not take into account is the massive disruption of the transport sector that is about to occur due to the introduction of Transport as a service.
Transport as a service will row explosively over the next 45 years, and it will be based around electric vehicles that are autonomously driven. An electric vehicle is around 5 times as efficient is it petrol driven alternative, and even if power generation continues using fossil fuels, there will be a massive reduction in the consumption of fossil fuels due to this increased efficiency.
The problem for the fossil fuel industry is that once this reduction in market demand becomes apparent then all the investment money that is currently pouring into the fossil fuel industry will disappear and instead transferred to the renewable power industry, solar and wind. The feedback effect on the fossil fuel extraction and processing industry will be vicious, and suddenly the world will see that they do not need as much fossil fuel as in the past. The price for oil will drop catastrophically and never recover, and this world have a catastrophic impact on the economies of the world’s oil exporting countries. What has happened to the coal industry in United States will be replicated around the world to the oil industry.
There is already signs that the Middle East exporters are aware of this looming crisis, and the countries with the most low cost oil are making certain that they are able to continue selling this or well as long as possible. However they are only delaying the inevitable, and the truth is that all the vast power that the oil exporting Nations have is already diminishing rapidly and will disappear over the next 10 years.