Getting Energized

One of the most expensive ways to generate power.

“Renewable” energy looks to be the next hot cocktail party topic to energize the Democrats in Washington, D.C.  It sounds great… we use some energy and it magically re-appears allowing us to use more so that we’ll never run out.  After all, who wouldn’t be in favor of a green field filled with bunny rabbits, chipmunks, and solar panels soaking up all of that free energy from the sun to power our widescreen televisions?  Well, as great as all that sounds it comes at an enormous cost, one for which most governments and their taxpayers are unwilling to pay.

Even Kyoto supporters concede that in the industrialised world the economic costs will outweigh the expected benefits. Emissions targets are an expensive and highly bureaucratic way to achieve next to nothing.

President Obama has made renewable energy a key point for his presidency and has stated many times how important it is that the U.S. moves away from oil, coal, and natural gas.

“To finally spark the creation of a clean energy economy, we will double the production of alternative energy in the next three years,” Mr. Obama said in a speech at George Mason University in Virginia.

Every American should recognize the importance of reducing our dependence upon foreign oil imports which support unfriendly regimes around the world and inflate our trade deficit.  While this is an important goal, the problem is not only that the Democrats are trying to pick the next “winner” for alternative power generation but that it is also going to be a very expensive proposition with many dead ends.

Ethanol subsidies driven by farm belt politicians.

Early the automobile’s beginning there were many different kinds of vehicles: wood, steam, gasoline, and electric-powered cars.  Each inventor sought to find the best means of powering their product.  Within a decade the gasoline powered car had won the day but not before many companies had paid a lot of money, built many different types of cars, and had bought a lot of advertising.  In the end, however, only one form of power generation became successful.

Do we really want the government spending taxpayer monies trying to figure out which types of alternative power generation will be the best?  Governments are not generally known to be the most efficient ways of allocating resources.  Just take a look at the accompanying illustration to see how the government, with the help of the powerful farm lobby, has chosen to “invest” in alternative energy sources.  Turns out that not only do government subsidies for ethanol raise food prices but they also cause more pollution!

Let’s take a look at solar power for a minute.  While solar cells have become more efficient over the past few decades it is still a very expensive technology because not only do you need the sun to generate power but you also need the solar cells and batteries to store the electricity generated not to mention a lot of electronics to make it all work.  Not only that but the best places to generate power are where nobody lives: the desert.  Moving power from where it is generated to where it is needed isn’t possible due to the inefficiency of moving electricity over long distances.  Solar is so expensive in fact that:

A recent study by the New Jersey Board of Public Utilities found that it cost about $77,500 to install a 10 kilowatt-capacity system on a house. Without subsidies, it would take 50 years to pay for itself. With subsidies, it dropped to 9.6 years.

The problem with trying to analyze alternative energy costs and benefits is that people can get quite passionate about the subject, turning it into a moral issue.  The problem with moving away from the facts is that the only way to get taxpayers behind the idea is to present reasonable arguments as to why Americans should give up their hard earned money for the sake of funding a different source of energy creation.  Without the backing of a majority of voters, alternative energy will be be a tough sell as it gets more expensive.

One of the great things about living in the United States is that there is competition.  Competition ensures better products, lower prices, and it’s all accomplished without the subsidies of taxpayers.  Because President Obama wants to sink $150 billion of taxpayer money into inefficient technologies the competition that makes our lives so much easier will vanish because technologies that are not yet ready for prime time will instead be propped up:

The most important is the fact that while alternative energy costs have fallen dramatically over the past 30 years, even with today’s high energy prices, alternative energy is still not profitable.

The average national electricity cost is 6.5 cents/kilowatt hour. Wind energy, by comparison, costs 12 cents/kWh and solar energy costing 27 cents/kWh. Optimistic claims assert that electricity would have to cost 8-10 cents/kWh to make methane digesters profitable.

There is a good reason we use what we do.

There is a reason why we have the power generation systems that we do: they are low cost, reliable, and work worldwide.  The gasoline you buy in France will power your car in Alaska and the coal you dig up in Pennsylvania will burn in a German power plant.  But applying subsidies eliminates these advantages completely and, once funded, we all know that it is very difficult to kill off a government program.  Just look at ethanol subsidies as mentioned above… their time has passed but there is no suggestion that this program will be de-funded.

Speaking of solar power again, there are:

[t]wo projects in development will cover 12.5 square miles of central California with solar panels. At noon on a cloudless day they are designed to produce 800 megawatts of electricity, about as much as one large coal-fired plant. But actual production will likely be one-third that, and at uncompetitive rates.

Why would somebody willingly pay more money to generate less power?  The answer, as usual, is one word: politics.  “Global Warming” alarmists like Al Gore and others are trying to scare people into going along with their agenda.  For example, this is what New York City Mayor Michael Bloomberg said:

While he acknowledged that scientists are unable to predict its consequences, Mayor Bloomberg yesterday compared the scourge of global warming to the threat of terrorism and the proliferation of weapons of mass destruction.

How can anyone in their right mind think that “Global Warming” is as dangerous as a terrorist setting of a nuclear bomb in downtown Manhattan?  The issue of alternative energy is not about facts, about efficiency, about doing what reason dictates, it’s about forwarding an agenda.  This “agenda” was best spelled out by Andrei Illarionov, the senior economic adviser to then-President Vladimir Putin of Russia:

“Have there been any international agreements to limit economic growth and development before Kyoto? Yes, there were two: Communism and Nazism.”

What’s so ironic about this is that many well known supporters of alternative energy like Al Gore are also the ones who use a lot of power and travel in private jets.

Not only is a lot of taxpayer money being spent on dubious forms of power generation but the goals are entirely unrealistic as well when we consider what percentage of electricity they will create for such high prices:

President Obama has called the bill a “down payment” on the “new American energy economy” he is trying to create.  He and the Democratic leaders in Congress say the bill’s energy programs, which will get a total of $37.5 billion, will double U.S. alternative energy capacity over the next three years.

But that’s not saying much. Solar and wind together provide less than half of 1% of our electricity.  Hydropower provides 7%, natural gas and nuclear about 20% each, and coal about half.  Incredibly, a possible $50 billion in loan guarantees for nuclear power was stripped from the stimulus in the committee conference process.

According to President Obama:  “We know the country that harnesses the power of clean, renewable energy will lead the 21st century.”

To me it sounds more like the muddled past of the infancy of the automobile except instead of allowing private industry and consumers to sort it out, we’re instead relying on the wallets of taxpayers and the “ingenuity” of the U.S. government.  When was the last time you drove a steam-powered car?

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