From J.P. Morgan Asset Management, May 4:
MICHAEL CEMBALEST
Chairman of Market and Investment Strategy
Eye on the Market
Eye on the Market
Welcome to our 11th annual energy paper. Each year, we examine what’s happening on the ground as the fourth great energy transition unfolds. Our main focus this year: why is the transition taking so long? Deep decarbonization plans assume massive changes in electric vehicles, electricity transmission grids, industrial energy use and carbon sequestration, but each faces headwinds often not accounted for by energy futurists. As shown below, many prior forecasts of the renewable transition were too ambitious since they ignored energy density, intermittency and the complex realities of incumbent energy systems. We follow up with an update to our bullish oil and gas call from last year and examine Biden’s energy agenda. We discuss China’s rare earth metals diplomacy, US distributed solar power and conclude with last words on the Texas power outage and answers to client questions on electrified shipping, sustainable aviation fuels, hydrogen and carbon accounting.As always, I would like to acknowledge the insights and oversight provided by our technical advisor Vaclav Smil, who has patiently guided my energy journey since this paper’s inception 11 years ago. This effort has been one of the most rewarding experiences in my 34 years at JP Morgan.
