381: Clean Energy Solves Only Part of the Problem

Buck: Welcome back to show everyone today my guest on Wealth Formula podcast is Ronald Stine. He’s an author and energy consultant and founder of Peet’s Advance. Ron has developed one of the most successful and innovative family owned professional services firms in California. Known as a leader in delivering staffing solutions to major oil refineries, the business supports arranging of staffing, consulting projects, services and business process outsourcing solutions to the nationwide Energy and infrastructure and life sciences industries. He’s a co-author of the Pulitzer Prize nominated book Clean Energy Exploitations and an expert in this space. Ronald, welcome to Wealth Formula podcast.

Ronald: Buck, glad to be aboard.

Buck: So I want to talk to you about obviously, what we’re going to talk about is your specialty in, you know, oil and gas and fossil fuels. Obviously, this is an area that gets people kind of riled up on both sides. But there’s sometimes there are some facts involved as well. Right. So first thing I want to talk a little bit about or ask you about is the demand for fossil fuels and why is it that we live in this environment where it seems that, you know, that there’s just tremendous support from the government and policy to work to eliminate fossil fuels, but at the same time, fossil fuels right now are at an essentially an all time high in terms of value.

Ronald: You have to understand that the big push today is wind and solar, but the world is recognizing that wind and solar only generated electricity. They manufacture nothing for society. And Sweden, I guess, bought into that and basically abandoned the wind and solar idea and basically going back to fossil fuels because I would love to get rid of fossil fuels, but there is no replacement in mind. There’s there’s nothing to produce the products. You know, today, through our ingenuity, we get a lot of oil derivatives get manufactured tomorrow. Because you have to understand oil by itself is 100% useless, all this black goo. But when it goes through a manufacturing process, through refinery, we get many things. We get a lot of oil derivatives that makes everything in our society, you know, look in your eyes is look in your hole, look in the hospital, look anywhere. Try and find something. Something that was not made with those oil derivatives.

Buck: Could you drill down on that a little bit? Because I know that’s something I don’t really know about and maybe our audience doesn’t know about because, like, what kinds of things? When you talk about oil derivatives, are you talking about like what? What are some daily examples in our lives?

Ronald: All the chemicals, all the chemicals that come out of the oil, because a lot of metal, hydrogen components and carbon components, but, you know, wind and solar car manufacturing, none of what you see in your office, they can manufacture none of what you see in the hospital. And, you know, the two greatest inventions in the world are the light bulb and the telephone. But they’re both made with oil derivatives, manufactured from oil you get rid of take the wind turbines, all the parts and components. So wind turbines are made with oil. Same thing with solar panels, same thing Leaving the IBI is 100% made with fossil fuels.

Buck: Did tell us, I guess, just again, to give us a sense about how does that work. I mean, when you say, you know, the EV is made with 100% fossil fuels. Can you explain that?

Ronald: Yes. All the electronics, all the components. Remember, electricity by itself can charge your iPhone, but it cannot make your iPhone and make a defibrillator in hospital work. But it can’t make the defibrillator.

Buck: So the materials themselves require fossil fuels, is what you’re saying. So there’s the energy component, but then there’s a material component itself, Right?

Ronald: Right, right. I don’t like to talk about energy. I like to talk about products and electricity, because everything you think about, everything in this world that needs electricity, everything needs electricity is made with fossil fuels from your television, your iPhones, You know, on and on and on, everything in the hospital. And but wind and solar can only generate electricity.

So I try and energy is, I guess, a confusing subject, especially politicians, because they think wind and solar can replace those fuels. But they try to do two different things. They only produce electricity where oil oil by itself is never used to generate electricity. That’s what I used to generate products for the chemicals for the products and the fuels. We have different fuels for the bills, trucks, airlines, the space program, all the electronics and the space shuttle. It’s all made with fossil fuel oil derivatives. So, you know, I tell people we had a zero emission society back in the 1800s. There were no coal fired power plants. There were no natural gas power plants. There was no nuclear power plants, the Beverly Hillbillies, and discovered oil here. And so but life was hard. People only lived to about 40 years of age. And when they’re born, they’re very seldom traveled. 100 miles from where they were born. They had no products that we have today. And all those products are made with the oil derivatives from oil. And we have yet to identify a replacement.

Buck: Yeah. So you’re okay is and to the extent that we’re talking about, again, we’re trying to we’re separating this into electricity and ultimately products that are derivatives of fossil fuels, which you’re saying is is, you know, pretty much everything around us and a lot of chemicals that are derivatives of fossil fuels are, you know, at this point in time, impossible to replace.

Buck: Is that fair?

Ronald: I wouldn’t say impossible. We have about 200 years to come up with a replacement. Haven’t done it yet.

Buck: Right. So, okay, well, that’s fair now. So let’s talk a little bit about the, you know, I guess the relationship between two sectors, the energy sectors, the oil and gas versus renewables. They’re pretty hostile, right? In general, I’m based on what you just told us in terms of the need for the products. Why is that? I mean, is there a future where all the forms of energy will be embraced in their own understanding? Maybe you do need some level during this transition process.

Ronald: Well, but remember that the world populated from one that 8 billion people in less than 200 years right after the discovery of oil, basically because today we have the products we didn’t have before. And, you know, the wealthy countries, you take the United States, UK, Germany, Australia, they basically are enjoying all these products, but the developing countries are not they haven’t joined the industrial revolution. Yeah, I mean, they’re burning cow dung, you know, for heat and they would love to have it. I know all the politicians want everybody to have electricity, but electricity is useless because everything it needs. Electricity is made of fossil fuels. And so that that’s a conundrum because, you know, it’s like jumping out of an airplane without a parachute, you know, before I get rid of fossil fuels. What’s the replacement because of the I guess the confusion in the air or in society is they’re comparing wind and solar against oil, but they do different things.

Buck: Right. But I think even at the policy level, it doesn’t seem like that distinction is being made really right. I mean, you would think you would get the policy. Yeah, it’s not. So what do we do about that?

Ronald: President Biden is flying around in a 400-ton airplane, 100% made with fossil fuels, all the electronics, all the seats, all the interior components made with false fuels is powered by aviation fuel, which comes from, you know, manufactured crude oil. And he’s screaming in the microphone, we’re going to get rid of fossil fuels. Yeah, yeah.

Buck: And presumably there may be a day when that is possible. I mean, what you’re talking about is, you know, we’ve got the electricity, maybe we’ve got the electricity component, but we don’t have a replacement for the products.

Ronald: Well, remember that electricity, you know, when Graham Bell, you know, invented the light bulb and everything, electricity came after magically were empty or after crude oil because crude oil basically made the light bulb. Crude oil basically made the telephone, still makes the total. And and like you said, you know, if you get rid of fossil fuels, you’re going to get rid of wind turbines because all the components are made with fossil fuels. You’re going to get rid of solar panels because all the components made with fossil fuels, you’re going to get rid of these because all the vehicles, you know, gasoline car as well as, you know, EVs are made of fossil fuel. So we we really got to focus on is there a backup plan. Now, the industry by itself, I think, has done a great job of improving its efficiencies in you know, when you take a look at the early 1900s, you know, cars were smoking terribly.

You know, refineries smoked terribly. You look at a refinery today and see all the emissions coming up, all that white stuff. It’s steam, steam and it’s just evaporating. You know, I, I look at when I had a car, you know, 30 or 40 years ago, you open the hood, you can put three your buddies under the hood. Tom Andrew was there. I have a mercedes now. I open up the hood. I can’t put a sandwich in there. So much environmental controls on. So the vehicles are like cleaner. People, I think are becoming more efficient and conservative. We don’t want to waste to stop, obviously. So conservation is going to be key in continuing increased efficiencies. But, you know, we don’t want to live like they did in the 1800s and they lived on each and every tool that fossil fuels. And I don’t really want to go back to that kind of living arrangement.

Buck: Yeah, I think that I mean, that’s a major argument. I think on the side of people who are, you know, I guess you want high profile fossil fuel or whatever, that at the end of the day I think the there is a lack of acknowledgment on the renewable side of the fact that we are in society now because of fossil fuels. We have the wealth we have in this country or in this world and developing nations because of fossil fuels. And so, you know, understand that and okay, maybe we need to transition, but we’re not there yet. But let’s talk a little bit about also some of the different kinds of energy, other types of electricity. Buck: I mean. Well, first of all, let me ask you this emission wise. You mentioned back when you had that car where you could put a bunch of buddies in the trunk, which sounds like a movie. I saw involving a lot of years.

Under the hood, under the hood. But do you have a sense of like how emissions from the United States have, how they have gone up over the last you know, the trend has been over the last, say, 30 or 40 years.

Ronald: Before I answer that question, I’m not pro-oil. I’m pro products in if you provide another solution to provide the products that we have today, hey, I’m all for safety. We’ve had, you know, a couple of years to come up with replace it. We’re still working on it. And so electricity is not going replace the products. But you talk about emissions. Let’s take a look at, you know, the wealthy countries that are pushing this green movement. You have, you know, the United States, UK, Germany, Australia, they are representing about 7% of the world, the other 93% dominated by China in the African countries, very little living on coal fired power plants. They’re building like almost one a day because coal is abundant, it’s reliable, it’s an expensive. They have no income. You know, the world’s got 8 billion people. But of those 8 million, 80% of them are living on less than $10 a day. We can subsidize themselves out of a paper bag. And so they’re just trying to provide, you know, some means of, I guess, opportunities to get out of the poor conditions that are in and, you know, go into wind and solar since they’re only intermittent electricity, it doesn’t replace the fossil fuels sharing electricity because we had a backup plan.

When we start blowing sands light shining, they’re not generating electricity. I think Germany, they eliminated their nuclear power plants. They limited the coal fired power plants. And now Germany has the highest cost of electricity in the world and businesses can’t invest in a business. They need reliable electricity versus intermittent electricity. And so all you’re doing is building a second generating facility, because if you want continuous uninterruptible electricity, you need something reliable. And so Germany is now importing electricity because they used to be much poorer. Now they’re importers. But yeah, so that’s the thing that bothers me the most. People are confusing. I don’t like to talk about the word energy a lot to talk about electricity. We want to talk about products, right?

Buck: Well, I mean, I guess the question is, could you reduce the amount of, you know, fossil fuels if you focus on them specific food or the purpose of products and focus on electricity using renewables? I mean, is there some kind of a way to do that as part of a transition?

Ronald: Well, again, electricity is it’s not needed unless you have something that needs electricity. And so, you know, you can have your cake and eat it, too. You know, you basically want to enjoy all the amenities we have today. They’re made with fossil fuels. But you want to eliminate fossil fuels. Well, say you can’t have your cake and eat it, too.

Buck: What are your take on nuclear energy? I mean, I know you’re again, we’re talking about electricity. Why why do you think green energy advocates are against nuclear energy? Isn’t that like a proven clean energy? I mean, and potentially solve the issue of huge cost that you were talking about that Germany has now?

Ronald: Oh, yeah. Yeah, definitely. Nuclear is the thing that everybody in the world is going nuclear except the United States. But, you know, you want, you know, continuous uninterruptible electricity and carbon free electricity. You nuclear is the way to go. And with the technology, you know, we basically invest a lot of money to launch people into space and onto the moon that I think these small modular reactors, these smaller, as you probably hear about, they’re much smaller than these big, you know, nuclear power plants. And I think they I’ll use the term cookie cutter. You can actually put them into locations and provide electricity, 400,000 people. And I think that is, you know, intermittent electricity use is really not useful for businesses. They need continuous power. And, you know, if you’re an operating room, you know, what can interrupt the power and yeah, so like to say, I mean most of the world is building nuclear power plants.

Buck: Is the safety on nuclear power plants do you think? I think obviously that’s the big concern with green energy advocates, right? I mean, in general, the fear of, you know, meltdowns like you saw in the Fukushima in Japan and all that kind of thing.

Ronald: Yeah, but take a look at those nuclear disasters that we have. I think the total number of deaths in the last 50 or 60 years were like ten or 12 people.

Buck: Yeah, although arguably you could say that there no, especially the ones in, in in in Russia it was in the Ukraine. I forget which one that was that called, but probably at a high number of people with cancer after that. But I mean that being said, I’m just curious of you know, of the there’s a way to, you know, to mitigate the risk of that kind of meltdown thing.

Ronald: I think the like. So that’s where I think we should be doing the investment is to invest in the technology, because I think nuclear probably has the best potential for providing unlimited electricity emission free electricity. And if we could focus on cleaning up the act to the public’s satisfaction, this place a Bill Gates, is investing heavily in these small modular reactors. And I think there’s one going into Colorado that he’s financing. But yeah, there is. That’s a technology because, you know, you want to build more wind and solar. I just wrote an article about, I think winds to provide more waste and electricity because every last like 20 years and we haven’t found a way to recycle them. And the same thing with solar panels. We haven’t done way to effectively recycle recycling. The same thing with the batteries. We haven’t found a way to recycle them. So there’s a big waste problem that’s coming because we’re right at the beginning of the disillusionment. They’re going to be the solution to our emissions problem. But, you know, I think emissions in the United States have been decreasing again, with the efficiencies of the refineries. I know I’m here in California and we have probably the cleanest refineries in the whole world with 700 in the world, and we got the cleanest ones.

Buck: You know, how do you think that this is all going to play out? I mean, you would admit we’re sort of in the middle of a transition right now if you were just based on what, you know, presumably this transition at some point, will we’ll move into a new era. What does that new era look like?

Ronald:

And I think it’s going to be acceptance, the fact that wind and solar or not as great as the and been promoted to be. And you know we have really some Sweden I think is setting the tone. I think part of Europe is recognizing the fact that you know electricity is is not doing what it’s supposed to do. It can’t support our lifestyle and it’s just can be an acceptance. You know, you want to live like we’re living now. Most of the world would love to live like us. Know people in China and India and Africa would definitely love to have our lifestyle, but they’re not going to have it unless we basically do with oil. And so, you know, today’s solution is oil. And I think we have technology to minimize the emissions, keep it under control. But it’s got to be, you know, conservation and efficiencies. We don’t want to waste anything we have because, you know, the world turned around 8 billion years and we like to be around for another doing years, too.

Buck: Sure. I guess one last question would be, you know, having a you mentioned, you know, Biden talking about eliminating fossil fuels and that kind of thing, Does anything materially change the last two and a half years while he’s been president when it. Well, it you know, in the sense of we’re in the space and the oil and gas industry.

Ronald:

Call it the fact that he has, I think, been instrumental inflating the cost of energy here in California. The cost of fuels, cost of electricity is up. And, you know, for the people who can afford it, no problem. The people who can’t afford it, that’s a problem.

Buck: How did you do that? How how did he his policies create an increase in price?

Ronald: He is limiting oil production. I’ll give you an example. Right here in California. In California, back in 95, between California oil production and imports from Alaska, we were pretty much self-sufficient. We provided like 95% of the demands of the state. And all the governors in California had been promoting reduced production, reducing reduced production. So today we used to rely on imports from foreign countries for 5% of our oil in 95. Today it’s an excess of 60%.

Buck: Oh, is that right? So we’re not self-sufficient anymore. I wasn’t aware of that.

Ronald: And so, yeah, and that is that is costing us millions of dollars every day to import it. And, you know, California wants to keep our air clean. But in essence, what we’re doing, we’re just leaking emissions somewhere else. The tigers that bring the oil in term, OPEC’s halfway around the world. The tanker emissions because they use a low grade motor fuel to power their ships. The emissions from those ships is double, double the entire mobile fleet in California. But that’s okay because our governor knew ceremony brings California air doesn’t agree that air outside of California.

Buck: That’s okay so interesting stuff. Well Ronald work we learn more about your work.

Ronald: You can just Google me. I’m on Wikipedia. There’s links to, you know, my website, my books. Yeah, just just Google me and Palestine energy consultant and all of the stuff would come up. I update articles, go out weekly, and they get exposed about a half million people weekly. And I’m just like, my focus is energy literacy. Like, so I’m not pro-nuclear, I’m not pro well, I’m not pro wind or solar. I would just like to provide electricity, provide the products at the best and most cost effective way for humanity. And like I say, there’s a lot of people in this world who love to move like us that they can’t and know instead of driving up the costs of electricity and the cost of fuel, it’s it’s really detrimental to everything because you drive up the cost of energy, you drive up the cost of lumber, the cost of eggs, cost of bananas, and everything goes up and the restaurant fees go up and the need for increased minimum wage goes up. It’s just a snowballing effect. And so I would like to say I would love to have people be more energy literate and to be able to talk about it at the dinner table. I would like to ask, you know. Biden identify something, something on his airplane, Air Force One. It was not made a class of fuels. Yeah.

Buck: Good stuff. Thank you so much for joining us, Ronald.Appreciate your time. Thanks for being with us.

Ronald: Thank you. Have a fantastic day.

Buck: We’ll be right back.