Investors' actions say much about the appeal of 'clean' energy

by The Oklahoman Editorial Board Published: October 24, 2013
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Earlier this month, the top executives of companies providing half of Europe's electricity production called for an end to subsidies for wind and solar power, noting they increase consumer costs and are harming system reliability. In Europe, clean energy production is subsidized through guaranteed prices. In France, wholesale prices have hovered around the equivalent of 40 U.S. dollars per megawatt hour, but electricity generated by windmills sells for a minimum amount of roughly $112. Consumers make up the difference.

Thanks to these inflated prices, investors funded many wind and solar projects after the 2008 recession caused European electricity demand to stall or decline. This created overcapacity and reduced system reliability as gas-fired plants were idled in response. Blackouts are now increasingly likely.

That may please global warming alarmists, but not consumers with limited incomes. In Germany, about 25 percent of power comes from wind or solar — but consumer prices have doubled since 2000. And, as GDF Suez CEO Gerard Mestrallet recently told The Wall Street Journal, “carbon emissions keep increasing.”

In the United States, consumers continue to prefer affordable over expensive, but theoretically cleaner, power. Yet the Obama administration's hostility to fracking and preference for “green” energy is well known. Europe illustrates the folly of overdependence on wind and solar. If the administration boosts those industries by impeding domestic oil and gas production, the result won't be a cleaner environment, just a higher cost of living and lower quality of life.

by The Oklahoman Editorial Board
The Oklahoman Editorial Board consists of Gary Pierson, President and CEO of The Oklahoma Publishing Company; Christopher P. Reen, president and publisher of The Oklahoman; Kelly Dyer Fry, editor and vice president of news; Christy Gaylord...
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