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Green power faces many hurdles
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Photo: AP Photo/Adrian Smith & Gordon Gill Architecture, HO
Renewable energy--green power--is in the news and on the floor of Congress. The Senate is currently mulling over a bill from the House of Representatives to implement sweeping changes to America's energy sector. Billions of dollars could be added to our national debt to subsidize a fledgling green energy industry.
The question is whether or not we should. Renewable energy faces many hurdles before it is "ready for prime-time", not the least of which is the ability for the industry to sustain itself long-term without government subsidies. Simply put, green energy has to provide sufficient profit for companies to invest in the infrastructure needed to produce it. Without government subsidies--or enormous cost increases--that is not currently possible.
Take Spain, for example. According to Bloomberg.com, Spain gets 11 percent of its electricity from wind turbines, and charges 11 times as much for that power as power generated by fossil fuels. The higher cost of green energy paid by consumers in Spain translates to about $774,000 per green job generated. Gabriel Calzada, professor of economics at King Juan Carlos University, estimates about 2.2 jobs lost for every green job gained in Spain--not including the jobs lost from companies that have moved operations elsewhere to escape the high cost of energy.
The Oakland Press also reports that the recession has also taken its toll on the green energy industry. "The recession has walloped the clean energy sector like every other," they report, "and no one is going on a hiring spree right now. Companies have shelved plans for wind farms, solar parks and biofuels plants. Some have laid off workers. Others have been forced to seek bankruptcy protection." They do, however, predict that hiring will pick up again late this year or next year. If so, it will be due to demand in the private sector, as the Waxman-Markey "cap and trade" bill is not supposed to take effect until 2012.
However, the greatest threat to the development of green energy is from the very party that espouses it. Sen. Ted Kennedy has famously opposed a wind farm off the Massachusetts coast. Sen. Diane Feinstein recently used her clout to kill plans for a giant solar farm in the Mojave desert. Hydroelectric dams in the Northwest have been under siege by Democrats and environmental groups for years. Ironically, the most common reason given in all of these cases is concern for the environment, which is the main concern Democrats list for pushing green energy
There is no question that Americans can and should do more for the environment, nor does anyone question the need to become more energy self-sufficient. The question is whether or not alternative energy sources can deliver on the expectations. There is no doubt that green technologies are advancing rapidly. Solar power has made tremendous progress in the past few years. It is still not developed enough, however, to meet even our current energy needs, let alone the potential demand should America move to electric-powered transportation, for example.
Recent research on solar power systems for my own home indicated that I would need a $70,000 system to generate the 40 kWh of electricity we use per day at peak seasons. Yet my current gas and electricity costs per year are only $1400. That's a 50-year return on investment, not including maintenance and replacement costs. I'm sure there are other variables and government subsidies that could come into play, but I have yet to see any estimate less than a 30-year return on investment. And that is before adding in the cost of charging two electric cars we do not yet have. The technological advancement is great, but the average consumer cannot yet afford it.
Green energy is a good idea. The technology will exist someday to make it more feasible and reliable. Government funding of research toward that goal is a good idea. We are not, however, ready for a complete switch-over without major government subsidy, and that is the problem. Paying a little more for energy and consumer goods is one thing. Paying a lot more--whether through higher prices or higher taxes--is just simply not affordable right now.
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