Can the Global Industrial Engine Run on Net Zero?
- March 14, 2026
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For decades, a powerful coalition of global institutions, led by the United Nations (UN), the World Economic Forum, and the International Energy Agency (IEA), has orchestrated a relentless campaign to pivot the global economy away from hydrocarbons toward a renewable-first energy model.
To date, over $10 trillion has been funneled into renewable energy (RE), supported by thousands of legal mandates enforcing the transition to a net-zero energy system.
However, the data tells a sobering story. Despite record spending, atmospheric carbon dioxide concentrations continue their steady climb, reaching new peaks without a visible shift in the long-term trend. In 2024, energy-sector emissions surged to an unprecedented 37.8 billion tonnes.
Additionally, the 2025 and 2026 reports from the World Meteorological Organization (WMO) and United Nations Environment Program (UNEP) confirmed that 2024 was the hottest year on record and 2025 was the third-warmest.
This disconnect suggests that the “Net Zero” framework is increasingly colliding with the immovable realities of an industrial world built on, and powered by, legacy fuels.
(Also read: Renewable Energy Soars, But Grid Upgrades Fall Short)
The Philippines: The High Stakes of the “Green Rush”
The Philippines presents a unique case. While the country has not officially made a legally binding Net Zero commitment, its government has established ambitious benchmarks for its green energy transition, aiming to reach a 35% RE share by 2030 and a 50% share by 2040.
However, a close examination of nations that accelerated their green transitions early reveals critical lessons for emerging economies like the Philippines.
Once a leader in climate legislation, the UK is now facing a significant reality check as its industrial base struggles under the weight of some of the highest energy costs in the developed world. While global prices have retreated from their 2022 peaks, wholesale electricity costs in 2026 remain roughly 35% to 44% higher than pre-crisis levels. This disparity is forcing many firms to consider shifting investment and production overseas.
Additionally, surging energy costs undermine the global competitiveness of the German steel and chemical sectors. EU industrial electricity prices reached €0.199 per kWh in 2024, more than double the rates in the US and China.
In the Netherlands, recent fiscal and regulatory changes indicate a strategic political retreat as the government acknowledges that rapid transitions risk social instability and economic contraction. A new Dutch coalition has officially removed the mandatory hybrid heat pump obligation that was set to begin in 2026. To ease the financial burden on households, the government is also reducing natural gas taxes by lowering rates in the primary tax brackets.
For the Philippines, the lesson is clear: forcing a rapid shift toward intermittent renewables requires massive upgrades to grid infrastructure and baseload backup—costs that are ultimately passed on to consumers and local businesses.
During his privilege speech in Congress, Representative Arthur Yap specifically highlighted offshore wind technology, which the DOE recently positioned at a Green Energy Auction Reserve (GEAR) price cap of ₱11 per kWh under the fifth round of the Green Energy Auction (GEA-5)
(Also read: ERC Raises Offshore Wind Auction Cap To Boost Investor Interest)
This guaranteed rate will be in effect for 20 years and will be automatically collected from Filipino consumers. Yap pointed out that the ₱11 figure is significantly higher than the current Wholesale Electricity Spot Market (WESM) average, which has recently fluctuated between ₱3.50 and ₱4.50 per kWh, and remains well above long-term WESM contracts typically priced between ₱4.00 and ₱5.50 per kWh.
“In fact, if you compute what the ₱11 rate is going to be for 20 years, that is the amount of half of the national import volume for rice that we are importing in the Philippines today,” he stressed.
Yap also emphasized that the mandate of the Electric Power Industry Reform Act (EPIRA) of 2001 is unambiguous: the state is obligated to ensure a “least-cost” energy supply for its citizens. “We promised just and reasonable rates,” he said. “We promised consumer protection.”
Why Net Zero is an Industrial Impossibility
According to environmental author and researcher Steve Goreham, Net Zero policies are failing to meet global energy realities. These mandates cannot support the industrialization required by developing nations. “Also, the rise of artificial intelligence drives a huge need for electrical power in advanced nations that cannot be supplied by intermittent green energy sources,” he wrote. Consequently, business and political leaders are increasingly recognizing that Net Zero and ESG frameworks are no longer viable blueprints for long-term economic stability.
Rappler columnist Den Somera confirms the vital role of fossil fuels as the foundational engine of social advancement. “It literally enabled society to meet the primary needs of its populace, including the means to provide the conditions for the people to have the ability to reach their full potential and development,” he wrote. “And, whether we like it or not, coal remains to be the largest driver of society’s development the world over.”
Despite widespread political calls to phase out carbon-heavy power, coal remains the primary engine of the global electrical grid, reaching a record consumption peak in 2024. Currently, more than 6,500 coal-fired plants are in operation, with an additional 1,000 units either under construction or in the planning stages. Although international leaders advocate for an end to its use, coal continued to provide 34% of the world’s electricity in 2024, maintaining its position as the planet’s leading power source.
Beyond coal, oil remains an essential driver for global industry. Economic historian Peter Coclanis observes that for years, climate activists have campaigned against fossil fuels, specifically targeting crude oil.
“But much of the population even today is not totally aware of the profound role of oil in areas other than transportation, HVAC, and power production,” he stated, adding that out of the approximately 32.3 billion barrels of crude oil produced globally, roughly 6 billion barrels (nearly 20%) were utilized for non-energy purposes.
Crude oil serves as the essential feedstock for a vast array of industrial and consumer goods. Petrochemical derivatives are foundational to the production of plastics, synthetic rubber, and fertilizers, as well as specialized items like pharmaceuticals, paints, and cosmetics. In particular, plastic resins have become indispensable across the construction, electronics, and medical sectors due to their unique physical advantages. Compared to traditional materials like metal, these oil-based synthetics are favored for being lightweight, durable, and moisture-resistant, while remaining cost-effective and easy to manufacture into complex components.
Coclanis argues that advocates for a fossil fuel phase-out overlook two critical realities. First, human history has never actually experienced a true energy transition, as emerging energy sources typically stack on top of existing ones, increasing the total global supply instead of replacing the original resources.
Second, he contends that critics focus too narrowly on power generation, failing to recognize that hydrocarbons are the essential building blocks of modern life. “Not for nothing do carbon critics such as Al Gore, John Kerry, Bill McKibben, and, recently, even Saint Greta (Thunberg), take to the sky in flying machines powered by aviation fuel and constructed largely of carbon composites,” he pointed out.
Currently, the artificial intelligence (AI) revolution is a primary driver of electrical demand within advanced economies. As the United States and China compete for dominance, data center construction has escalated dramatically to support AI expansion. This shift is highlighted by the scale of private investment; last year, Google, Amazon, Microsoft, and Meta directed more than $380 billion toward AI infrastructure, a figure exceeding the individual GDP of over 140 nations.
Despite corporate commitments to reach Net Zero, AI’s expansion is undermining these targets. For instance, Google originally aimed to transition to entirely carbon-free energy by 2030, yet the company reported in 2024 that its emissions had actually climbed 48% over the previous years, driven primarily by the power requirements of AI services.
Natural gas and nuclear power are increasingly being used to meet the massive energy demands of AI data centers.
Larry Fink, co-chair of the World Energy Congress and CEO of BlackRock, emphasized that intermittent sources like wind and solar are insufficient on their own. “You need dispatchable power because these data centers cannot simply turn on and off,” he noted.
For the Philippines, the aggressive pursuit of RE targets threatens to become a regressive tax on its most vulnerable citizens. While the country is often pressured by climate activists to accelerate its Net Zero declarations, such demands ignore a stark geopolitical reality: the Philippines contributes a mere 0.5% of global carbon emissions.
Imposing the same transition timelines on an emerging economy as those on industrialized nations is not only inherently unfair but also economically risky. With 17.54 million Filipinos living in poverty as of 2023, the government’s primary moral and legal obligation must be domestic stability rather than global appearances.
Currently, roughly 1.6 million Filipino households still lack dependable electricity, while millions more endure frequent outages that stifle education and economic growth. Prioritizing high-cost, intermittent sources like offshore wind diverts critical resources away from achieving affordable energy access.
For a nation still building its foundations, a transition that prioritizes carbon targets over affordable, reliable baseload power is not a leap forward, but a barrier to the very development required to lift its people out of poverty.
Sources:
https://www.masterresource.org/goreham-steve/climate-change-energy-world-leaders-turmoil/
https://wmo.int/news/media-centre/wmo-confirms-2025-was-one-of-warmest-years-record
https://wattsupwiththat.com/2026/02/07/crudely-put-oil-is-everywhere/
https://www.acenrenewables.com/2025/11/philippines-renewable-energy-transition/
https://www.businesseurope.eu/media-room/data-hub/high-cost-of-energy/
https://business.inquirer.net/575447/erc-sets-p11-kwh-cap-for-offshore-wind-auction
https://www.youtube.com/watch?v=NvLJEPI-kyQ
https://www.philstar.com/business/2024/09/23/2387184/philippines-lacks-net-zero-commitments
https://pia.gov.ph/press-release/poverty-rate-down-to-15-5-percent
