THE GERMANS TRIED SOLAR AND WIND ENERGY – AND ARE NOW RAPIDLY BUILDING NEW COAL PLANTS
Last week, President Biden attacked the coal industry. He said his administration was going “to be shutting down these plants all across America…” He also said that wind and solar are cheaper than fossil fuels (which they are not). Democrat Sen. Joe Manchin of West Virginia immediately lit into the president, saying his comments were “not only outrageous and divorced from reality, they ignore the severe economic pain the American people are feeling because of rising energy costs.” To put it kindly, the president displayed considerable ignorance of physics, chemistry, and economics in one very short speech.
Back in 2019, the president said that he was going to make America carbon emission neutral by 2035. The Paris Agreement had called for carbon-neutrality by 2050. The bad news is that neither one of those targets has any chance of being met. The good news is that it probably does not make any difference. Energy expert, Professor Gautam Kalghatgi, in a new paper published in the Journal of Transportation Engineering, wrote: “Reaching net zero greenhouse gas emissions by 2050 globally is impossible given the scale of the transformation of the energy systems and societies that will be required. The reality needs to be accepted and in general, more focus needs to be put on adapting to any future climate change by implementing ’no regrets’ policies to make societies more resilient to any perceived effects of climate change.
This week, the U.N. is holding its 27th climate conference in Egypt – an event where many thousands of climate activists meet (most at someone else’s expense) with a huge carbon footprint, to discuss why, as usual, they have made virtually no progress since the last conference – which was held in Glasgow. James Stevenson, head of research for a major energy data provider, noted that Europe is not only greatly increasing its coal burning, but: “Coal is also rising … in nine large Asian markets, including China and India where coal accounts for at least a third of the fuel used to generate electricity.” According to the IMF, “global emissions have also jumped since the Glasgow conference, exceeding their pandemic levels.”
Again, the reality is that fossil fuels supplied 82.3% of global energy use in 2021, while wind and solar only provided 1.75%. The remainder was from nuclear, hydro, geothermal, and other. The advocates of wind and solar often fail to include the full costs of the mining for specialty minerals, and the pollution caused in the production and placement of wind and solar. Unlike fossil fuels and nuclear, wind and solar require back-up energy plants or very expensive high capacity batteries for the periods when the wind doesn’t blow and the sun doesn’t shine. The Germans, among others, tried this experiment – and after its failure are now rapidly building new coal plants.
Biden administration policies are much to blame for the high energy prices, which are not due to energy executives somehow suddenly becoming more “greedy.” Imagine that through hard work and initiative you built a small chain of pizza shops. Suddenly, the government announces that it has determined that pizza is not good for people, so it is going to do everything it can to shut down the pizza business. New taxes and new regulations are placed on pizza shops, and old regulations are enforced with vengeance. Banks are told not to give loans to pizza shop owners for expansion or modernization.
The cost of being in the pizza business sharply rises, and these cost increases drive some shop owners out of business and require the remaining shops to raise their prices to stay in business. But the people still like pizza, even though it may not be the healthiest food, so they are stuck paying more for pizza – “aka, pizza inflation.” The president attacks the pizza owners as being greedy, causing some of their neighbors to hate them.
The same thing has happened to people in the oil and gas business. The president announced that he was going to drive the industry out of business – the obvious result was to reduce new investment in the industry, which over time limits supply, causing prices to rise, bringing supply and demand back into balance. The government also increased taxes and regulations, which increased costs, causing prices to rise for those still in the industry. Smaller companies find it most difficult, if possible, to obtain loans for expansion and maintenance – again reducing supply. The president calls you “greedy” for reacting to his policies in order to stay in business and keep your staff employed. Some of your acquaintances and even family and friends believe the president when he calls you evil and your children are embarrassed to admit they know you.
As costs continue to rise, prices follow, and anger grows. More and more politicians demand the takeover of the oil industry, which is then nationalized. The new, state-owned oil industry is increasingly mismanaged and corrupted, and production drops. It has happened in many places – Mexico, and more recently Venezuela, as examples.
Economic progress is closely associated with inexpensive and dependable energy. The steam engine, by greatly reducing the cost of energy, enabled the industrial revolution. Destroying inexpensive energy destroys economic growth, which eventually destroys civil society. You choose!
RichardW.RahnischairmanoftheInstituteforGlobalEconomicGrowthandMConLLC.
https://www.washingtontimes.com/news/2022/nov/7/teaching-biden-about-energy-and-climate-change/
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