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Saturday, April 16, 2011

Following in Europe's Footsteps

My unabashed support for wood energy solutions is due in no small way to the successes I've observed in several European countries, most notably Finland, Germany and Austria. In technological development and sociological approaches to the use of alternative energy, we're lagging events in Europe by a few years.



I ran across a coupling of interesting articles this week that demonstrate that there are both benefits and problems with following their trends. One benefit is that we can witness the results of their social energy experiments and hopefully improve on their techniques and results. The first article I'll refer you to is "The U.S. Should Follow Europe's Lead" written by Paul Driessen at Townhall.com. Mr. Driessen presents a stark story of  how the last two hard winters have highlighted the unintended consequences of choosing policies that intentionally increase energy prices. And he summaries the mood in the following paragraphs:

"A new report from Scotland found that renewable energy kills 3.7 traditional jobs for every “green” job it creates. Wind power mandates also cost British energy consumers an extra $1.8 billion in higher electricity costs in 2009-2010. Rebellion is in the air, and belief in dangerous manmade global warming has plummeted. 
European Energy Commissioner Gunter Oettinger put it bluntly. “If we go alone to 30% [renewable energy],” he said, “you will have a faster process of de-industrialization in Europe. We need industry, and industry means CO2 emissions.” Tougher climate and renewable targets will force industries to move to Asia, he added, and steel will likely be one of the first casualties. Europe can no longer afford to “prop up” renewable energy industries."
Mr. Oettinger's comment reminded me of a story out of California earlier this week. In "California Sets Nations Highest Renewable Power Goals", we learned that California, under its new old governor Jerry Brown,


"...signed legislation requiring California utilities to get one-third of their power from renewable sources, giving the state the most aggressive alternative energy mandate in the U.S. 
California utilities and other electricity providers have until the end of 2020 to draw 33 percent of their power from solar panels, windmills and other renewable sources. 
"There are people who think we can drill our way to happiness and prosperity," the Democratic governor told hundreds of workers and other supporters at a solar panel manufacturing plant near San Jose. "Instead of just taking oil from thousands of miles away, we're taking the sun and converting it."

The logic of this seemingly arbitrary goal flies in the face of the current economic experiences of Europe as expressed by Mr.Oettinger above. That is one of the dangers of being a follower; you have a hard time seeing what the leader sees.

As you might guess, there are those in California who are not thrilled with these latest policy goals.

"Critics of the legislation said sticking with traditional energy sources such as coal and natural gas would be cheaper, keeping costs down for business and residential ratepayers. Business groups point to estimates that the higher standard could drive up electricity costs for California ratepayers by more than 7 percent, despite language in the legislation to limit cost increases. 
The California Republican Party pointed to one study that suggested the average Californian's energy bill would go up 19 percent under the new standard. 
"Industry in California already pays electricity rates about 50 percent higher than the rest of the country," said Gino DiCaro, spokesman for the California Manufacturers and Technology Association. "With 33 percent, those rates are going to go up even more."

As we've discussed here before, there are ways to make renewable energy work smartly. But by forcing arbitrary goals on Big Power without acknowledging the economic implications of what the power industry must do to reach those goals will certainly hurt the economy in the short run and may foster rate payer backlash against renewables in the longer run, as the Europeans are finding out.

Left out of the discussion in both articles is the role of biomass energy. Government's focus is often on wind and solar solutions, while the more energy efficient and affordable biomass solutions continue to go unnoticed. But not in those countries where wood has been fully utilized. You can bet that none of the freezing people mentioned in the first article were in communities in Scandinavia, Germany, or Austria where biomass heating projects or incentives have been implemented. Those folks enjoying their wood pellet boilers or district heating connections are staying warm while the urbanites locked into their policy-induced high energy rates are left to suffer.

So, it looks like California is in fact following in Europe's footsteps. Unfortunately for the Californians, they are more closely following Portugal or Spain with their solar/wind focused "green dreams". And not coincidentally,their economic situation seems to be headed down the same road. Californians are serving as guinea pigs in America's version of the great Social Energy Experiment, driven by government corporate partners like General Electric, General Motors, and Gamesa. As administration spokesman, Energy Secretary Stephen Chu put it:

"By the end of the decade, our goal is to make solar cost-competitive with other forms of energy, all other forms of energy," Energy Secretary Steven Chu told the crowd at the SunPower Corp./Flextronics plant. "This would be a game-changer for us, opening up a world of export opportunities, and California's innovators and businesses can help us achieve this goal."

Gonna be a long decade for Californians. And for the rest of us, as we bail them out of their financial woes...just as the Germans and Austrians will be bailing out the Portuguese and Spaniards.

Guess who won't be sweating it? The Chinese, who are quickly taking over the world's production of solar tiles and panels (see here and here). While they power their country on coal, hydro, and nuclear energy.

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