Energy prices are surging, and it is hurting. Inevitably, we are seeing a backlash against green policies and sustainability, which is creating cynicism concerning ESG.

Green stocks have come under the spotlight recently, with the FT running a story in which it quotes the chief executive of Aviva Investors saying, “green stocks are often overpriced.”

He said: “I believe that as a general strategy, buying brown and helping it to become green will deliver better investment returns.”

And there is probably nothing wrong with that. Are green stocks overvalued? Frankly, if they are, they are in good company; many stocks look overvalued right now. Maybe we are seeing a green bubble, and maybe there are parallels with the dotcom bubble when a debate raged over click and chip stocks (pure tech stocks) versus click and mortar (traditional companies embracing tech.) What we can say is that while the dotcom bubble ended in a crash, it also helped speed up the development of the internet.

But there is a broader point. Across social media, the Aviva story was cited by ESG critics ‘as yet another’ reason to back-paddle on sustainability policies.

With gas and oil prices riding high, with rising energy bills dominating headlines, renewables get blamed, and ESG gets caught in the crossfire.

Yet it is not reasonable to blame renewables for higher energy costs. Instead, the surge in oil and gas prices is the main cause of higher energy costs.

As this piece in Carbon Brief argues, reducing carbon reduction policies and green subsidies in the UK has led to higher energy bills.

I can, however, think of some compelling reasons to blame renewables for the energy crisis. In fact, I can think of 150 trillion reasons, and that is because estimated oil reserves are thought to be worth 150 trillion dollars.

Indeed, sustainable policies have this problem: the global economy thrives on waste. We upgrade our smartphones regularly, clothes have become disposable items, food is bought but not eaten, and thanks to waste, we spend more, which boosts GDP.

Degrowth theory cites the above as a reason to put less emphasis on economic growth. However, the problem is not so much economic growth but how we measure GDP.

If we find a way to make something more efficiently or create less waste, then that is good. It is perverse to argue differently.

Hybrid working is a case in point. If we spend less money on travel and less on shirts and suits that we wear to work, if companies spend less money on office space, we should celebrate. Instead, we often see a backlash because of the perceived economic hit on GDP. But economic theory shows that in the long term and indeed the medium term, greater efficiency is good for the economy. To say otherwise is the philosophy of Luddites.

Returning to renewables, over and over again, I read a long list of reasons why renewables are the “cause of our ills.” Solar is no good when it is dark, wind no good when there is no wind, so we are told that net-zero is causing too much economic damage. Unfortunately, ESG and ESG thinking gets caught up in this.

But the renewables critique is either misleading or wrong.

Part of the problem is that the solution to the intermittent nature of renewables isn’t just one thing; instead, the solution is more holistic. First, it involves combining wind and solar because they are primarily complementary energy generating technologies. For example, it is often windy when it isn’t sunny. Secondly, the solution involves long-distance direct current energy transmission, such as the Xlinks project, which will transmit energy generated from wind and solar in Morocco to the UK. It also involves smarter use of energy applying AI and internet of things technology, channelling energy generated under optimal conditions into less time-sensitive applications. And, of course, it involves energy storage, for which there are multiple solutions.

As climate change scientist Michael Mann says, the technology to defeat climate change already exists; it just needs scaling up.

The biggest challenge with renewables relates to infrastructure: the cost of transmitting energy from where it is generated to where it is consumed.

Invest in this infrastructure, and we reduce the risk of future spikes in the oil and gas price sparking an energy crisis and indeed reduce Europe’s need for Russian gas.

Yet such nuance gets overlooked in the public debate, and there is this $150 trillion reason to overlook it.

ESG is as much about consumer psychology as anything. Consumers demand that producers of the goods and services they consume be ethical companies. The pressure of climate change will amplify this demand. Ergo, ESG is good business.

But the current energy crisis threatens to disrupt this psychology, and the ESG community must better communicate the need for sustainability.

In the longer term, the momentum to sustainability will continue because the threat of climate change will become more obvious in the longer term. But right now, the set of attitudes that together create the demand for ESG is under threat, and the ESG community needs to communicate their case with greater urgency.