Europe loses its bet on renewable energy

William O'Keefe:
In the aftermath of the adoption of the Kyoto Protocol in 1997, the EU, led by Germany, remained in the forefront of climate policy by pledging to reduce CO2 emissions by 20% by 2020. To achieve this objective and show the rest of the world how to be successful and green, EU nations adopted renewable energy programs that were supported by lavish subsidies.

The result has been something of a disaster. One nation after another has encountered serious economic problems and begun to back away from spending commitments that did not add jobs but did raise unemployment and electricity prices.

The Wall Street Journal looked at the EU program and concluded: “Europe’s energy crisis is a lot like ours of 40 years ago—self-inflicted. Europe’s dream was untenable the minute energy prices began falling in a major trade competitor like the United States”. The EU program was based on the flawed resource depletion model. As fossil energy resources were depleted, their prices would increase making renewables more attractive. There are several problems with this logic. First, proven reserves of oil and gas have grown, not shrunk. Over the past 40 years, the world has consumed 3 times the proven reserves at the time and today they are at least double what they were then. Second, renewables—wind and solar—are intermittent. When the sun doesn’t shine or the wind blow, where does the energy come from. For most EU countries the answer is coal.

Germany, the leader of the green revolution in the EU, has so far held firm with its commitment to renewable power. How long it can maintain that commitment is an open question. The burden of its green folly has fallen on households and businesses that pay electricity rates that are triple ours. As a result, there is more and more talk about Germany’s “deindustrialization”. Unemployment is far worse than it is here and industries are looking to relocate here because of the cheaper prices that have resulted from the shale revolution.
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Bjorn Lomborg, the well known environmental economist, recently observed that using available macroeconomic models, the EU is spending “$280 billion annually to avert $10 billion in damages.”...
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They are following the failed policy Obama tried to impose on the US to their detriment.  The competitive advantage of the US caused by the shale gas revolution is already resulted in billions being spent to create manufacturing jobs in this country that will have an impact in both Europe and Asia.  Much of it is being spent in Texas.

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