Time for a rational dialogue on how ‘green’ power is working out

I was glad to see John Roberts’ kind letter in the Ely Times in response to a column of mine about the problems with renewable energy. It shows people are beginning to think critically about our energy policies in general and Nevada’s energy future in particular. It is better to have a dialogue than a monologue.

“Mr. Mitchell is correct when he says our tax dollars go toward tax breaks and subsidies for renewable energy. But this is also true of all forms of energy,” Mr. Roberts writes. “Fossil fuel, natural gas, hydroelectric and nuclear power are subsidized in one form or another, and have been for some time. It has always been recognized that it is in the national interest to have a ready and affordable source of electricity available. In 1936, Congress established the Rural Electrification Act to provide loans and make other funding available to rural areas that otherwise would not receive electric power.”

My grandparents were still using kerosene lanterns and wood stoves out on their farms when I was a child, but under the REA they soon had electric lights and radios.

Energy consumption is a key economic indicator, despite Obama’s chagrin that the USA has only 5 percent of the world’s population but consumes a quarter of the world’s energy. We don’t just consume it by watching TV and playing video games, though. We consume it while producing one of the world’s highest outputs of goods — crops, cars, trucks, machinery, electronics, etc. — and quality of life. A quarter of the world’s GDP comes from the United States.

Conservation for conservation’s sake is a self-inflicted wound. Conservation to cut cost and improve the profit margin is wise.

And, yes, oil and gas and nuclear have been “subsidized” in the form of various tax breaks, but the level of subsidy is greatly tilted toward renewables, especially in this administration, as this chart shows, because the solar subsidy is off the chart by a factor of 10-plus.

Energy subsidies by source and per unit of output. Note that the solar subsidy is off the scale exponentially. (Institute for Energy Research)

Although I have trouble with government picking winners and losers, I would have less heartburn if government were perhaps funding research to make “green” energy viable in the marketplace instead of just propping up existing technology with taxpayer and ratepayer funds. Wind and solar still cost anywhere from two to four times as much as fossil fuels — and the price of natural gas keeps going down as production exceeds demand.

NV Energy has contracted to pay some solar energy plants as much as 13.5 cents per kilowatt-hour. Residential customers are currently paying less than 12 cents per kwh. How long can that last?

Mr. Roberts continues, “Mr. Mitchell is also correct when he says the sun doesn’t always shine; nor does the wind always blow. But this isn’t a concern. Peaking power plants are designed to come on line quickly, either to provide additional power during ‘peak’ or high usage, or to stand in for power plants scheduled for maintenance.”

The problem is two-fold: Double capitalization for the idle peaking generator and that the stop-and-go reduces their efficiency and increases greenhouse gas output, negating the major purpose of “green” energy.

“Wind and solar energy are only part of our nation’s wide approach to energy production,” Mr. Roberts continues. “But in a state like Nevada where there are no fossil fuels, no natural gas and not enough water to support nuclear energy, wind and solar are a viable energy alternative.”

Yes, wind and solar could well provide a viable alternative in the future, but now we are paying higher tax and power bills for existing technology that hopefully soon will be obsolete. Meanwhile, we are building plants that will last 20 or 30 years — and never will pencil out without a hefty subsidy. Obama and Harry Reid call that an “investment” in the future. I call it pouring money down a rat hole.

Wisconsin is currently experiencing the practical bottom line impact of going “green.”

Alliant Energy Corp. recently announced its wind farm subsidiary is dragging the company profits down and plans to sell its wind division.

According to the Milwaukee Journal Sentinel, Alliant posted net income of 51 cents a share for this past quarter, up 21 percent from a year ago. However, its wind subsidy lost 19 cents a share. The company said profit for its wind projects “experienced modest erosion.”

“Nevada has the potential to be a clean energy exporter and create jobs,” Mr. Roberts concludes. “Let’s put politics aside and do what makes sense for the Silver State.”

I agree whole-heartedly. Put politics aside, because right now it is “politics” that is pushing “green,” demanding it be a quarter of Nevada’s energy portfolio and a third of California’s. Other states are building their own “green” plants. A few may wake up and decide those portfolio standards are too costly. There may be no place to export to. Right now, Nevada has all the electric power it needs for years to come.

Fund research for “green” energy, perhaps. But propping up technology that is not yet ready for the marketplace and prime time is foolish. Why should a “green” power company innovate if Uncle Sam and the state legislators can guarantee a profit? Just build it, and take the checks to the bank.

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17 comments on “Time for a rational dialogue on how ‘green’ power is working out

  1. Steve says:

    Remember that first car? It had potential too.

  2. Speaking of promises, this is what Obama said today about axing oil and gas tax breaks: “We’ve subsidized oil companies for a century. That’s long enough. It’s time to end the taxpayer giveaways to an industry that rarely has been more profitable, and double down on a clean-energy industry that never has been more promising.” A promise like: I’ll still love you in the morning.

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  3. Steve says:

    According to that chart that promise will put pennies back in the coffer or cut a tiny fraction of the solar power subsidy cost. A BFD IMO.

  4. Or as Palin said of Obama’s Win the Future theme … WTF?

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  5. peter zuro says:

    With electric prices going through the roof, I have been trying to replace the two 15 year-old AC condensing units on my residence. Natural gas prices have been dropping. Guess what? I can’t find an American-made natural gas fired split-system air conditioning for homes. Imagine that?

  6. All made in China?

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  7. Steve says:

    Probably Mexico. Its another version of the dumb act, send a bunch of manufacturing to Mexico and all the illegals will sneak back.

  8. [...] fuel, natural gas, hydroelectric and nuclear … … See the original post here: Time for a rational dialogue on how 'green' power is working out … ← Understanding the Sources of Renewable [...]

  9. Athos says:

    My memory’s a little fuzzy, but I bought a 5 ton unit A/C (Crane?) for my home 10 years ago. Cost, installed, $2300.

    peter zuro, what are we paying for a similar 5 ton unit, today?

    And why? So some liberal can tell his kid he’s saving the Polar Bears?

  10. You might mean Trane. Made in Wisconsin, I think.

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  11. Steve says:

    They want about 5 grand, installed, today. If you want the manufacturer to honor their warranty you better have it professionally installed or you will be crawling on the roof trying to fix it even under warranty if it fails.

  12. Athos says:

    Trane sounds right. All I do is pay the bills (and earn the money). I’m just struck with how liberal/collectivists behave like children. The kids never think about where the food comes from, or who pays the bills, they just want more (and they know that they’re not paying for it!)

  13. Athos says:

    And Steve, I’ve heard that number is closer to $12K. Something about new government approved freon.

  14. Steve says:

    Athos, my unit is 23 years old now. Living on borrowed time. I have signed up with a local company (Sahara) to do twice a year maintenance on it. They would replace it for about 5 grand on my small house. Split units and larger homes could easily go much higher. Depends on what you need.

    In my case roi depends on the actual amount of lowered costs I get from the replacement, by my figuring…..I wait for the current one to break bad and hope its not in the dead of summer!

  15. A/C outage in the middle of summer? Done it … with a house full of kids and grandkids. Tried sleeping in tent in the backyard. Still too darned hot.

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  16. Steve says:

    Me too. The exhaust fan failed one year on the 4th of July. My temp fix was to pull the motor and rip it open, I was able to get it working for the night by leaving the case screws a little loose. I found a replacement at a large cost the next day (still a day off that year) and that one has been working ever since. If that goes it is worth replacing. Its the compressor that causes replacement.

  17. [...] biomass industries — none of which would survive a nanosecond in the free market but are being propped up for decades to come with production tax credits and direct grants. Taxes come out of one pocket to pay for [...]

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