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The Green Wizard: Natural Gas Not Renewables

Melanie Sturm | @ThinkAgainUSA Read Comments - 5
Publish Date: 
Thu, 05/10/2012

 

As if accompanying Dorothy en route to the Emerald City of Oz, Americans seek a green wizard to fulfill our hearts’ desires -- a world powered by renewable energies like solar, wind and bio-fuels.  Bedazzled by Glenda the Good Witch’s solar-powered ruby slippers, we want the green-brick-road to lead us to a cleaner energy future. 


However, without Auntie Em to awaken us to reality, Americans must Think Again. Though cast as the Wicked Witch of the West, over the last decade the conventional energy industry has revolutionized America’s energy outlook.  Today we’re the most energy-endowed nation in the world, with enough clean, reliable, abundant, and cheap natural gas to last for generations. 


It’s “like adding another Venezuela or Kuwait by 2020”, according to Pulitzer-prize winning energy expert Daniel Yergin who believes the world energy map now centers on North America, not the Middle East. Energy consultant Wood Mackenzie estimates that tapping new reserves would generate one million jobs by 2018 and generate $803 billion in governmental revenue through 2030. Additionally, these new extraction technologies require far fewer wells, though they present fresh environmental challenges that several states (including Colorado) have addressed with new regulations to protect the environment and secure water supplies. 


Thus, rather than crucify the conventional energy industry, we should celebrate the entrepreneurialism and technological ingenuity that’s enabled the US to become a net energy exporter for the first time since 1949. The government need only permit development of new reserves -- not subsidize -- to further American energy independence, fuel our vehicles, lower energy costs and reap economic gains.


Meanwhile, promoters of green energy policies continue to argue that “investments” in renewable energies are environmental and job-creation boons for America, though our journey along the green-brick-road proves otherwise. Whether evaluating wind power in tornado-swept Kansas or solar energy in sunny California, renewable technologies are woefully uneconomical, wickedly unreliable and surprisingly unsound environmentally.


It’s understandable Americans dream green, considering we were told in 2008 that by investing $150 billion over the next decade in renewable energies, we’d reap five million new jobs.  But as former Treasury Secretary Larry Summers noted, “The government is a crappy venture capitalist”.  That’s because lobbying prowess and political viability outweigh economic viability when government picks winners and losers. 


After “investing” $110 billion since 2009, the sector is littered with taxpayer backed, bankrupt companies like Solyndra, Beacon Power, and Ener1, all of which paid bonuses before going under. Reuters reported last month “the wind industry… has shed 10,000 jobs since 2009 even as the energy capacity of wind farms has nearly doubled”… while the demonized “oil and gas industry added 75,000 jobs.”


The truth is, industries that aren’t economically viable don’t create real jobs, and those that are viable, don’t need subsidies. Plagued by competitive disadvantages like sun and wind intermittency, and expensive land, capital, transmission and backup capacity, these technologies are uncompetitive, small market players and remain subsidy-dependent.


Despite receiving 53.5 percent of federal financial support for the electric power sector, wind and solar supply only four percent of US power at a cost 100-300 percent more than conventional sources, according to the Energy Information Administration. A University of Wyoming study notes that because green policies increase prices, the “economic benefits derived from building renewable energy facilities in the short-run are more than offset by losses in economic output and employment”, thus hurting the poorest and most vulnerable.


Additionally, given renewables’ green patina, many don’t appreciate their adverse environmental impacts beyond the eyesore, noise, water usage, and wildlife destruction. Called “energy sprawl” by the Nature Conservancy, renewable energies require vastly more land while producing significantly less energy than conventional energy.  Most disconcerting, their incurable intermittency requires utilities to rely on conventional power to cycle up when there’s no wind or sun, and power down when there is, thus diminishing carbon reduction advantages.


If policymakers weren’t brainless scarecrows, cowardly lions and heartless tin men, they’d adopt Bill Gates’ proposition that cheap energy is “a fantastic vaccine” for the economy.  That’s what Americans deserve – a booster shot to deliver authentic solutions, real jobs and genuine economic growth. Moving beyond fossil fuels will happen eventually when superior and affordable energies are scaled for mass use.


Energy development isn’t a zero sum game, as the Wyoming study concludes: “Environmentally responsible development of fossil fuel resources could be complementary with renewable energy development, creating jobs and generating tax revenues to ensure a robust economy capable of creating and funding innovative renewable energy technologies of the future.”


Given our economic straits and the remoteness of the green dream, the underlying question is how much more are Americans willing to pay to harness wind and sun. Isn’t it time to demand that our leaders propose energy solutions based not on ideology but on how to best guarantee prosperity for generations of Americans?   


Think Again – a secure, affordable and environmentally sound energy future is not over the rainbow.

 

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Unfortunately, with word

Unfortunately, with word limits, there's only so much one can write in one column and many of your points I would have liked to address, but couldn't. Also, I'm rather upset with the Aspen Times, which rarely edits my column beyond grammar and syntax, for dramatically changing the following sentence (which appears correctly on this website) which I wrote:

The government need only permit development of new reserves -- not subsidize them -- to further American energy independence, fuel our vehicles, lower energy costs and reap economic gains.

You'll note that I had originally suggested the government shouldn't subsidize the conventional industry, but they took out "-- not subsidize them --" from that sentence when they published the column, and that was the only substantial change they made.

Also, I never like to engage in a "he said, she said" argument, so I didn't discuss how much one industry or another is in fact subsidized because it's irrelevant to me — none of them should be "subsidized". This is more a question of how to reform our complicated, politicized and corrupt tax system where all manufacturers including energy companies can secure tax benefits.

That's different from the policies that force government mandates on energy consumers or require utilities to use more expensive power sources, which is the most onerous policy, undermining our economy and employment. I could only take a small snippet of the Bill Gates quote but he is an alternative energy advocate and investor who understands the toll exacted on the most vulnerable in our economy by forcing energy prices to be artificially high, thus reverberating throughout our economy to grocery stores and airline tickets, etc. The poor pay a much higher percentage of their income for energy expenses like basic heat and electricity. That's why Gates advocates using cheap energy now which can propel economic growth and prosperity. Furthermore, the example of California where the mandate is to use 33% renewable power by 2020 is killing industry and forcing the middle class to leave the state. For the first time in California's history, they have a negative migration and their tax base can't afford the size of its government — they're a few steps behind Europe and a few steps ahead of our federal government.

When entrepreneurs have private capital that comes from economic prosperity, they invent — see Silicon Valley. No where else in the world is this the case, except Israel. Who could have imagined how efficient and affordable the computer processor would become, revolutionizing our lives and bringing innovation and affordable lifestyle advantages to so many, and that was private industry and private capital that realized huge benefit for the economy and society. The incentives to develop renewable energies scaled for mass use are there in the free market — let it work!

Finally, there is the original argument that that the government must force renewables now for environmental reasons, including global warming. I'm trying to suggest that because the renewable energies aren't yet "ready for prime time", they offer no real environmental advantages, while being economically destructive — especially as compared to the vast and cheap sources of natural gas which is cleaner than coal which supplies 50% of our power needs. You should look into the studies that show how small renewables' carbon advantages are because of their "intermittence". They generate power at the wrong times and we haven't yet figured out how to store and transmit the power. These "concentration", "siting" and "transmission" problems won't be solved by building more renewables now and certainly not by having the government pick the companies they want to work on it — let bonafide venture capitalists do it.

The politicians who are advocating for government support of renewables aren't being honest. You'll hear them say we'll lose jobs if we take the support away, which is simply dishonest as I tried to explain in my column. Also, they're not making the environment argument so much anymore. If they, like you, believe its urgent to channel scarce taxpayer resources toward these dubious projects at a time when America is saddled with $16 trillion of debt and trillion-plus dollar annual deficits, let them make that argument and let the voters decide.

I'm so grateful that you read my column and that you took the time to write me your thoughts. Mostly I'm delighted that we're having this important dialogue — that's what America is all about! Please stay engaged — you're very thoughtful and reasonable and I'm delighted to have you as a reader!

Best,

Melanie Sturm

Unfortunately, your column is

Unfortunately, your column is based on some major misconceptions.

“The truth is that industries that aren't economically viable don't create real jobs, and those that are viable don't need subsidies.”
The truth is that the oil industry is still massively subsidised in the US. Estimates range from $10 bn to $52 bn annually.

“Moving beyond fossil fuels will happen eventually when superior and affordable energies are scaled for mass use.”
And how do you think they will become superior and affordable? I’m pretty sure it won’t happen by investing in oil and gas. Therefore, we need to invest in alternative energy now, even at a slightly higher cost. This is an investment in the future, because it will help lower the cost and gain more experience with these energy forms, which will help us deploy them more efficiently in the future. Oil and gas on the other hand are energy sources that are cheap (if external costs are not accounted for) now, but will only become more expensive in the future as demand will grow and supply will decrease. Furthermore, it is a fact that they will run out sooner or later, even if climate change was not an issue. Therefore it will be cheaper and less painful to start passing on to renewable energy now, than it is to suddenly have to change in a few decades.

Fact is that the climate is warming and this will have dramatic and costly consequences if we don’t do anything to fight it. Even the rather conservative and oil-friendly International Energy Agency (IEA) agrees with that. How some people try to deny the facts reminds me of the battle between the scientists who had cold hard evidence that smoking is harmful and some tobacco-backed pseudo-scientists who tried to make a case against the incontestable evidence (even though I was not alive at the time).

As some people say, history tends to repeat itself. Somewhere down the road – and I hope it won’t be too long – mankind will be looking back and wondering we can have denied what seemed so obvious to so many people – just like it was the case with smoking "controversy". You can make up your mind now, on whose side you want to be on when we arrive at this point in time.

So maybe, after all, not the proponents of green energy simplify reality too much – it’s people like you who look away from the challenges we have to face inevitably.

I hope I have been able to give you some food for thoughts.

I had to write you after

I had to write you after coming across Think AgainUSA, a common sense approach to energy (May 9, 2012). Thank you for your lucid and enlightening comments on energy. I live in Palm Springs, CA--where all the energy news seems to be devoted to propagandizing wind and solar. Windmills have destroyed so much of the beauty of the desert near Palm Springs. Hope that doesn't happen in Aspen. I sincerely appreciate your well written commentary.

What a great article for the

What a great article for the gas play we all work in. I admire your courage to write a column like that in Aspen. You could get tarred and feathered. It takes writers like yourself to get the population to stop and look at what is really going on in America....to Think again.

Keep up the great articles’.

Well done piece today. We

Well done piece today. We were just talking yesterday about natural gas in Western Colorado. Supply is there , we need more demand. If we could get more municipalities to increase their fleets with ng powered vehicles alone it would be a great start. Grand Junction has begun, hopefully more to follow. That should result in more private use. There is only one private auto here now that is ng fueled. That needs to change. Thanks for making people think. VW

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