ENB Pub Note: This is an excellent article from David Blackmon, which was originally published on Forbes, and backlinks are provided. I will be talking to him about this on an upcoming podcast.
As we have discussed on the Energy News Beat Podcast, we are not in an ‘Energy Transition’ with our current technology. Instead, we have been in a costly energy addition. We will get to that point, but with current wind, solar, and hydrogen, they are not fiscally sustainable.
There is no denying that 2025 has not been a good year for the progress of the energy transition, that aspirational dream of shifting the global energy system away from heavy reliance on fossil fuels to greener solutions like wind, solar, hydrogen and other renewable forms of energy. The recent, latest failure of COP30 delegates to reach a consensus agreement on a roadmap to transition away from fossil fuels was just the latest in a long series of daggers to the heart of this costly global project.
Gates, Corporate CEOs Become Scapegoats For Energy Transition Failures
COP30 convened in Belem, Brazil just weeks after billionaire and long-time energy transition advocate Bill Gates published a 5,500 word piece detailing a shift in direction in his environmental funding which one critic referred to as “a gut punch” to the heart of the movement. “Climate change will not be the end of civilization,” Gates wrote as the first what he called “Three tough truths” which justify his change in philosophy, thus negating one of the main arguments in the advocacy narrative for the transition itself.
Getty Images for Bloomberg Philanthropies
Some critics accused Gates of bending his strategies to the will of U.S. President Donald Trump and the sea change in energy and climate policies enacted in his second presidency thus far, and it’s hard to refute the point. After all, Gates invests tens of billions of dollars every year in energy and environmental projects and businesses: Anyone attempting to manage such investments would be foolish not to factor major shifts in public policies into their strategic approach. Doing otherwise is a recipe for bankruptcy.
Former Secretary of State for Barack Obama and Biden Climate Czar John Kerry expanded that theme of pointing fingers of blame in a recent interview with the Financial Times, essentially calling unnamed corporate leaders cowards for cancelling and modifying green energy investments this year. “It is not that they don’t believe [in climate change] or they don’t want to move forward. They are just scared,” Kerry said of the corporate CEOs, adding, “The process of Donald Trump in the last months, coupled with the justice department, coupled with his vengeance programs, has scared… a lot of people.”
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Certainly, 2025 has seen a long parade of such corporate announcements as big energy companies like BP, Shell, and Equinor bail out of multi-billion-dollar investments in offshore wind, solar, biofuels, and hydrogen projects. Some of those decisions – especially related to the U.S. offshore wind sector – have undeniably come in response to Trump policy decisions and the congressional cancellation of IRA subsidies in the One Big Beautiful Bill Act.
Energy Transition Investments Lose Favor
Others, though, appear to be made in response to a rapidly shifting business environment based on factors like supply chain challenges, inflation, the cost of capital, and reorganizations of internal business strategies that began long before last year’s U.S. elections. A good example is this week’s announcement by British major BP that it will cancel a planned multi-billion-dollar hydrogen hub planned for northern England.
In a statement, BP attributes the decision to “material changes in circumstances on the Teesworks site, including a planning application being granted locally for a data center on the same piece of land.” The announcement was just the latest in a long line of moves by the company designed to reallocate capital back to the company’s core oil and gas business which started immediately after the resignation of former CEO Bernard Looney in December 2023.
Similar business dynamics were at play with Shell’s September cancellation of a planned green hydrogen project targeted for Norway that would have been the largest such project in the world had it been completed. Machteld de Haan, Shell’s Downstream, Renewables and Energy Solutions President, said in a statement: “As we evaluated market dynamics and the cost of completion, it became clear that the project would be insufficiently competitive to meet our customers’ need for affordable, low carbon products. This was a difficult decision, but the right one, as we prioritize our capital towards those projects that deliver both the needs of our customers and value for our shareholders”
Again, this move was the latest in a long series of internal decisions in a years-long project to reallocate more of the company’s capital budget away from less profitable renewables back to its more profitable core oil and gas business. Certainly, shifting public policy was a key factor in the decision, but blaming it all on Trump or demonizing the CEOs constitutes simplistic thinking which avoids the point.
Where Does The Energy Transition Go From Here?
The fact is that the energy transition is struggling mainly because the alternatives in which governments around the globe have invested trillions of taxpayer-and-debt-funded dollars haven’t proved to be truly viable on a societal scale. Thirty years after the subsidy programs for alternatives began, oil, natural gas, and coal still provide roughly 80% of global primary energy, barely changed from 1995.
As S&P Global Vice Chairman Daniel Yergin and many other experts have noted, no real energy transition is currently taking place. As 2025 comes to an end, and with little reason to believe that an actual transition might magically materialize in 2026, perhaps a renaming of this costly global project and revision of its supporting narrative is in order. The old talking points aren’t working.
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