Vance attacks Harris on energy by cherry-picking facts

A few days before Sen. JD Vance’s Wall Street Journal op-ed on energy policy and "net zero" dropped, his billionaire backer Peter Thiel was asked if climate science was real. Thiel, an investor and entrepreneur, ummed and erred extensively on Joe Rogan’s podcast before reiterating that he thought climate science wasn’t real because any science with a modifier ahead of it isn’t real.

Here’s a transcript:

Joe Rogan: You don’t feel that climate science is a real science?

Peter Thiel: It’s ... it is ... um ... it’s ... it’s ... um ... well. Let me ... it’s ... I ... there’s several different things that one could say. It’s possible climate change is happening. It’s possible we don’t have great accounts of why that’s going on. So I’m not questioning any of those things. But how scientific it is — I don’t think, um, I don’t think it’s a place where we have really vigorous debates. You know, maybe the climate is increasing because of carbon dioxide emissions; temperatures are going up. Maybe it’s methane. Maybe it’s people are eating too much steak; it’s the cows flatulating. And you have to measure how much is methane a greenhouse gas versus carbon dioxide. I don’t think they’re rigorously doing that stuff scientifically. I think the fact that it’s called "climate science" tells you that it’s more dogmatic than anything that’s truly science should be. Dogma doesn’t mean that it’s wrong."

This novel textual take sits oddly with the actual practice of climate science, which involves a lot of those old lab fakers, chemistry and physics. Sadly, it suggests Vance may need to look elsewhere for help fixing the glaring flaws in his own analysis.

Vance, Donald Trump’s Republican vice-presidential running mate, declares that Vice President Kamala Harris, the presumptive Democratic candidate, has waged war on US energy. If so, she’s not much of a general and nor is her boss. US oil and gas production has hit new records under President Joe Biden and net exports of these fuels have surged.

Leaving that aside, Vance’s main thrust — signaled by the obligatory nod to his hardscrabble upbringing and the assertion that "Kamala Harris cares more about climate change than about inflation" — is that Americans can’t afford the energy transition. In reality, we can’t afford to avoid it.

Vance can point to big nominal increases in energy prices since Biden took office, citing a 30% increase in electricity costs and a 42% increase for gasoline. Such numbers don’t tell the full story. Pump prices, in particular, had slumped by the end of Trump’s term because of the initial wave of the covid-19 pandemic when, you may recall, the roads were unusually clear. The biggest increases in energy prices were in 2022, spurred by the impact on commodity markets of that renewed Russian invasion of Ukraine that Vance doesn’t care about (Moscow escapes any blame in Vance’s op-ed).

Moreover, as a share of Americans’ personal disposable income, there’s barely any difference between Biden’s record on energy costs and that of Trump, if we exclude the unusually depressed pandemic year of 2020.

Vance is correct, however, that decarbonizing the US energy system will require a lot of spending: About $1 trillion per year just through this decade, according to Bloomberg NEF. That is a huge undertaking requiring a nuanced sharing of the burden. Where I quibble is with Vance’s framing of this as an avoidable cost that stands in the way of energy "affordability."

Saying that energy is affordable as long as you ignore the risks associated with emissions-driven climate change is about as intellectually coherent as Thiel’s prefix-test for scientific authenticity. You really can heat your home affordably by burning the furniture, folks, but you will ultimately pay a price, nonetheless; something another denizen of (pre-) Silicon Valley, Thomas Edison, figured out over a hundred years ago. The bills for cleaning up after extreme weather events, shoring up coastal cities against rising sea levels and bailing out broken insurance markets are costs. Money spent to prevent them is an investment.

And most of that investment is at home. Yet Vance claims that factories are "shutting down across the heartland." Someone really ought to tell him about the record investment in manufacturing happening right now; a big chunk of it in clean tech factories. Perhaps that could be a job for the 18 Republican House members who just warned against repealing the Inflation Reduction Act, lest the investment and jobs it is spurring in mostly red districts disappear. As for writing that it doesn’t matter what the US does given China’s coal habit, Vance might want to peruse a plan for that very issue put forward by a fellow Republican senator.

Vance also warns that the grid is on the verge of catastrophe due to the rising penetration of renewables and regulations "stifling" investment in coal, natural gas and nuclear plants. This stance is strikingly similar to that of the "Project 2025” lobbyists from which the Trump-Vance campaign has sought to distance itself.

Like that document, Vance offers a retrograde vision for the grid that ignores the cost advantages of scalable clean technologies — which are booming — and the fact that the big enemy of coal-fired power hasn’t been wind turbines and solar panels but cheap shale gas. Electricity demand is rising, as Vance warns, but that’s partly due to the AI-dreams of Vance’s Silicon Valley chums. And rising electricity demand isn’t a bad thing in itself. Vance cites the electric vehicle mandate as a risk, but there are huge efficiency gains to be made when we swap thermal for electrical energy. The big challenge lies in streamlining the planning and approvals process for new infrastructure.

Like the factory boom, technological advances and relative costs, Vance’s argument rests ultimately on simply ignoring the inconvenient externality of climate change. It has become increasingly difficult to downplay the threat or muddy the science while also maintaining credibility. Such was evident in Thiel’s sputtering and, more strikingly, the recent attempt by fellow tycoon, and EV pioneer no less, Elon Musk to dilute his earlier warnings on climate change so as not to offend his guest of honor on X, Trump (see this). There is no war on energy, but the assault on reason is ramping up.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners. Liam Denning is a Bloomberg Opinion columnist covering energy. A former banker, he edited the Wall Street Journal’s Heard on the Street column and wrote the Financial Times’s Lex column.