As energy prices continue to soar, it is clear that the impetus for private companies to turn away from fossil fuels and commit to the green revolution is slowing.
Figures published by BP in its quarterly update revealed it had made its biggest quarterly profit for 14 years between April and June this year. The bumper profits ($8.45bn, or £6.9bn) were driven not by a commitment to renewable energy or any success of a new solar and wind farm strategy, but by BP’s traditional stomping ground of oil and gas. As anyone with a petrol or diesel car knows, prices have rocketed in recent months and it is this increase that formed the backbone of BP’s success.
This situation only serves to underline the vital role that the public sector must play in moving nations towards becoming low carbon economies: the incentive for the likes of BP and others to make the transition themselves is simply not there while fossil fuel prices continue to soar.
For all the good words and intentions of oil and gas companies, in the end they are there to serve shareholders and make profit. That means they will always be skewed towards making the most money they can and at present that means focusing on oil and gas.
As a result, governments need to be resolute in their focus on tackling the carbon challenge - and that means providing incentives and working with the private sector to drive more investments into carbon reduction technologies and projects.
In the UK, massive projects like the Sizewell C nuclear project may garner plenty of headlines, but it will be other commitments, particularly around reducing the reliance on petrol and diesel powered vehicles, that will be tested as oil and gas companies prefer to focus on big profits now over long-term investments.
This is where public-private agreements will be central as the public sector needs to remain steadfast in its commitment to delivering new, green infrastructure that will help reduce the risk of catastrophic climate change - while also provide a new revenue stream for companies that is more sustainable over the long term.
PPPs will provide part of the solution only if the politicians stick to the resolve that became apparent in the depths of the Covid-19 pandemic, when plans were hatched around the world to ‘build back better’. With the pandemic’s lockdowns hopefully behind us, inflation rampant and a cost of living crisis engulfing households across the world, it could be easy to ditch the long-term plan in favour of short-term measures - such as reopening old fossil fuel-burning power stations.
However, such efforts would be disastrous for the planet’s health, they would also provide only short-term relief.
After all, the best way to tackle issues around rising energy prices is to develop a more sustainable and secure supply of energy - one not reliant on long pipes stretching from Russia, or on how much a Gulf state is willing to pump out of the ground at any given time.
Global economies have long been driven by the pursuit of natural resources. With the technology available today, most countries should be able to find the resources they need within their own borders, for example through offshore and onshore wind farms, solar arrays and hydropower plants.
A failure to invest in these facilities would be a failure of public policy to deliver on the potential for nations to take advantage of their own resources and take control of their energy destinies - in a way that is not only good for the planet but which is sustainable for as long as there is wind, sun and water.