The too-high price of green power

By Daniel W. Nebert

Concerned about “global warming” and “climate change,” the European Union has been far ahead of the United States in solar- and wind-energy development. But — economically — how have they fared? The answer is: Not so well. In fact, not good at all.

Denmark has been the EU leader in renewable energy. In 2012, the Danish Parliament agreed politically to 50 percent of energy consumption from wind power by 2020, 84 percent by 2035.

The Danish government has now completely changed its mind. In recent months, it decided to abandon plans to build five offshore wind power farms — to be functional by 2020. Denmark realized its green policies have become too expensive to maintain.

Danish consumers and companies pay the highest electricity prices within the EU, according to Eurelectric, the European Electricity Association. In 2014, 66 percent of an average Danish electricity bill went to taxes and fees; 18 percent went to transportation, and only 15 percent for the electricity itself. (Germany was second highest, with 52 percent in electricity taxes.) The Danish climate minister recently stated: “We can’t accept this, as the private sector and households are paying far too much. Denmark’s renewable policy has turned out to be too expensive.”

It has become obvious that all the green energy plans mandated to reduce EU emissions of carbon dioxide (CO2) will not achieve substantial reductions. In some cases, the actions are actually making matters worse.

A serious examination of successful and failed introductions of technology … might teach us some lessons.

For example, in spite of the combined EU governments’ spending over the past decade — more than 1 trillion euros of taxpayer money on “Green Subsidies” — CO2 emissions in the EU have actually risen. In 2015, CO2 emissions from fossil-fuel combustion increased by 0.7 percent, compared with 2014. In Germany alone, CO2 emissions increased by an estimated 10 million tons from 2014 to 2015, a setback to that nation’s claims of “climate leadership.”

According to the Institute of German Business, the cost of Germany’s once highly publicized Energiewende (its transition to green energy) will increase — in 2016 alone, another 31 billion euros (or $35 billion in U.S. dollars). This will further weigh down the already sputtering German economy.

Last year, Germany actually paid wind farms $548 million to close down to prevent damage to the nation’s electricity grid. Germany’s wind and solar power systems, at unpredictable times, had provided too much power, which then damaged the grid and made the system more vulnerable to blackouts.

RWE AG (founded in 1898 as Rhine-Westfalia Electricity plant, in Essen) is the second largest electricity producer in Germany. Over the past decade it has invested heavily in renewable energy. That company is now going bankrupt, showing 45 billion euros in long-term liabilities. This has resulted in rating agencies dropping RWE bonds to just above the “Junk” level.

Part of the reason for “Brexit” in the U.K. has to do with citizens’ concerns about fiscal responsibility. Indeed, in order to work on balancing the budget, the new Prime Minister Theresa May has disbanded the Department of Energy and Climate Change. Similar governmental actions have recently occurred in Australia. It has become obvious that green energy cannot be sustained without long-term government subsidies. Renewable energy costs in this sense can be thought of as a regressive tax, felt most by society’s poorest. And the poorest countries.

Agriculturists are aware that plants today are 25-percent “carbon-starved”; the plants would benefit from several times more atmospheric CO2 than what now exists. Climatologists dispute that CO2 is correlated with global warming. Realistically, the goals of attempting to decarbonize the world are without precedent in human history and must be examined closely. And rationally.

A serious examination of successful and failed introductions of technology over the past 200 years might teach us some lessons. Perhaps Americans, especially Oregonians, should think more seriously about the consequences of our government’s actions.

Daniel W. Nebert is professor emeritus in the Department of Environmental Health at the University of Cincinnati. He is now semi-retired and living, with wife and cats and near his children, in Oregon.


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