London, Allen Lane, 2011, ISBN: 9781846145421; 816pp.; Price: £30.00
University of Essex
Date accessed: 1 April, 2020
In this study of energy policy, looking primarily at the period since the Gulf War, and in particular the first decade of the 21st century, Daniel Yergin continues to focus on the subject matter of his Pulitzer prize winning book The Prize: The Epic Quest for Oil, Money and Power.(1) Since the publication of that book, and the success of the accompanying TV series, Professor Yergin has become regarded as an authority on energy policy, international politics and economics, heading a leading energy research and consultancy firm. This new book reflects his widening interests. The scale of the book – over 700 pages of text – is also reflected in the ambitions of the content. Although appearing to incorporate part of his previous book’s title – ‘The Quest‘ – this is an ambitious survey not only of more recent developments in the production and transportation of oil, but also of all forms of energy, and in particular the generation of electricity, upon which our modern world relies so heavily. To a large extent, the focus is on the contemporary energy situation and its future prospects. Will the world be able to generate enough energy for its continually rising needs? How may the security of those supplies, where consumers are rarely self-sufficient, and producers have their own political and economic goals, be guaranteed? In answering both these questions, what will be the impact upon the world environment and climate?
As with his earlier book on the history of the oil industry, The Prize, Yergin’s study of the history of the energy industry is accessible to the ‘ordinary’ reader, with catchy subtitles every couple of pages, a heavy use of anecdote, and an emphasis on personalities and striking quotations. It too would make an excellent TV series. Given the importance of the themes covered in this work, its accessibility is an important plus factor. In many ways this is a difficult book to synthesise, because it covers so many different trends, driven in part, one assumes, by Yergin’s own interests and preoccupations. Indeed, as one might expect in a book of this length, in many respects this is not so much one book as several. The first section in effect carries on where The Prize left off, with the expulsion of the Iraqi forces from Kuwait and the imminent fragmentation of the Soviet Union. It explores the complex world of the modern oil industry, with new significant players, both as producers (the Central Asian republics, the offshore fields in Brazil, for example) and also as consumers (China is the obvious example here, but more generally the rising developing economies of the BRICS nations). The second section focuses on the problem of energy security, something which has driven the key governments of the world since the discovery of the importance of oil to modern warfare in the First World War. The next section explores the critical importance of electricity and what Yergin calls ‘gadgetwatts’. By this he means the many indispensable symbols of modern society and communication, such as smartphones, iPads, electronic books, laptop computers, DVD players, all requiring the consumption of electricity. Whilst as recently as the 1970s, 91 per cent of household electricity in the United States was consumed by ovens, indoor lights, refrigerators, freezers, water heaters, air conditioning and space heating, those now only account for 55 per cent. New devices such as microwaves and dishwashers, along with the ‘gadgetwatts’, account for the rest. In the fourth section Yergin shows himself to be a believer in anthropogenic climate change; he outlines the difficulties in reaching any kind of international consensus, but concludes that the growing awareness of its impact is encouraging greater energy efficiency and above all an interest in renewables. It is the diversity, scope and history of renewable energy to which he dedicates the fifth section, before offering, in his conclusion, an optimistic view of the future.
As the above summary may suggest, this is more than simply a history of energy and energy security. It incorporates very recent developments, including the crisis at the Japanese nuclear station in Fukushima (which had an immediate impact on many countries’ plans for a growth in nuclear energy), the Arab spring, and even the death of Osama bin Laden. However, although primarily a discussion of the past decade, with the focus clearly on future developments, there is nonetheless a strong historical dimension within the book. Yergin refers to a new ‘Great Game’ for example: he explores in some detail the evolution of the science of climate change, and the history of electricity. In discussing the latter he considers the struggle between Edison and Westinghouse, and how Samuel Insull – a man more usually associated with dubious business practices in the run-up to the Wall Street Crash – helped revolutionise electricity distribution, making it far more readily available (although it was to be Franklin Roosevelt’s New Deal that brought the benefits of this 20th–century boon to the rural areas of the United States). He also gives a detailed and fascinating account of the history of climate change, beginning with John Tyndall’s study of glaciers in 1856, and tracing the origins of Al Gore’s commitment to the topic. Certain key themes emerge which are familiar to students not only of the history of oil and energy, but also the history of the world economy. The remarkably recent but immense impact on production of a shift from energy produced by men and animals to that driven by fossil fuels; the impact of globalisation; the consequences of the North-South dialogue and the contradictory goals of developed and developing nations, are all central to this work. Beyond the wide sweep of historical trends, however, Yergin clearly believes in the importance of the individual. Throughout the book, he gives brief thumbnail sketches of particular individuals and companies. At times, I felt that the emphasis on the individual and the anecdote took precedence over the identification and exploration of historical trends, but it will undoubtedly make the book more accessible to a wider readership.
In terms of the future of energy, Yergin makes clear that, despite his emphasis on the importance of renewable sources of energy (solar energy in particular, but also wind, water and biofuels), he is sceptical about the concept of ‘peak oil’. He stresses that this is far from the first time that there have been shortage scares in relation to oil. This is certainly the case, and it is true that on earlier occasions – during both World Wars and in the early 1970s for example – new sources of oil were found in the nick of time. However, much of the new oil that is being discovered – though reflecting the new technologies and ingenuity which Yergin celebrates within the book – is either very difficult to produce, or is far from markets, or both. There is undoubtedly a lot of oil available through shale oil, for example, but it comes with considerable costs, both environmental and financial. Yergin also emphasises the importance of natural gas, and in particular shale gas. He seems less concerned by the costs of exploiting shale oil through the process of ‘fracking’ than some contemporary commentators.
In this wide ranging discussion of international history and politics, Yergin emphasises a number of themes which need to be highlighted. For example, he emphasises the importance of pipeline politics, pointing to the bitter disputes over the routes to be used to transport oil and gas from the Caspian Sea region to markets in Europe. An interesting theme which Yergin stresses, and which is only just beginning to be acknowledged in the wider literature on the politics of international oil, is the rivalry between the US and China. His underlying message is the importance of innovation and diversity of supply – both in terms of supplies of oil and also of alternative sources of energy. He traces this back in history to the views of Winston Churchill in 1913 when, as First Lord of the Admiralty, he discussed the consequences of moving from a coal-fired navy to an oil-fuelled fleet. As befits someone who has written on the history of oil, he is well aware of the close ties between the history and tensions of the Middle East on the one hand, and secure supplies of petroleum on the other. In this respect, he is particularly concerned at the possible acquisition by Iran of a nuclear weapon. He is very aware of the impact of the growth of developing economies, such as those of China and India, and the likely effect of that upon demand for energy. Yergin also stresses what used to be called conservation, but which he renames as efficiency. This is, of course, something which has been acknowledged for some considerable time, not least after the 1973 oil crisis. However, he is perhaps too sanguine in his discussion of the potential contribution of efficiency to energy security. It is important to stress that conservation tends to be most attractive at times of high energy prices. When oil prices fell in the 1980s, so too did interest in conservation.
For such a large work, on such a topic, there were comparatively few maps, particularly in the earlier section. To discuss the importance of bottlenecks such as the Straits of Hormuz or the Malacca Strait without an accompanying map seems somewhat perverse. There are a lot of photographs of key individuals and events (including a young Ronald Reagan extolling the virtues of the all-electric house), but I would have preferred more graphs, tables and figures. However, this is not a book aimed primarily at the academic historian, and the photographs, as with the short biographies and lively anecdotes, enhance the accessibility of the work.
In this book, Yergin demonstrates the continuing centrality of energy to the world, and as a consequence, how the security of that energy remains a preoccupation of governments, companies and individuals. Although he stresses the importance of efficiency, his study of the rising use of energy – and the inevitability of its continued rise, particularly in the fast developing economies but also as a consequence of the prevalence of ‘gadgetwatts’ – makes it clear that those concerns will not go away. He demonstrates that the factor impelling oil diplomacy from the early years of the 20th century – that the main consumers of petroleum were not identical to the main producers of petroleum, thus making self-sufficiency impossible – still remains today. China may be a major producer of coal, and indeed a producer of oil as well, but it still relies upon foreign supplies of energy, and has had to adopt policies directed at securing adequate supplies for the future. He clearly expects renewable sources of energy generation, rather than fossil fuels, to be of growing significance in years to come, even though his discussion of the future of access to fossil fuels is a positive one. Overall, this book demonstrates that Daniel Yergin is primarily an optimist when it comes to the future of energy security. Looking to the past, he demonstrates that when faced with apparently insurmountable difficulties – projected declines in oil production, the onset of climate change, the impact of Middle Eastern politics upon the security of petroleum – humankind has found solutions. Yergin concludes his book with the words that creativity ‘is at the heart of the quest, it is as much about the human spirit as it is about technology, and that is why this is a quest that will never end’ (p. 717). He stresses the search for knowledge and innovation, and, pointing to the globalisation of demand for energy, he also concludes that ‘… the resource base of knowledge and creativity is expanding. This will fuel the insight and ingenuity that will find the new solutions’ (p. 717). This entire book is, in effect, designed to demonstrate that this optimistic approach is based upon historical precedent.
- Daniel Yergin, The Prize: The Epic Quest for Oil, Money and Power (New York, 1991).Back to (1)