By Isaac MacMillen
In the race to appease the global warming-conscious enviro-lobby, several states have passed measures mandating that a certain percentage of the states’ respective energy needs be met by renewable sources. Yet in spite of good intentions, many states are falling behind in meeting their renewable energy goals. The reason? Utility companies are having trouble finding viable ways to meet the quotas set for them by the state bureaucrats.
In this economic downturn, many utilities are struggling to meet that goal. Massachusetts and Connecticut received over $23 million combined in fees which the utilities were forced to pay in 2006 because they were unable to meet the unrealistic goals set by the states.
What’s the problem? Isn’t it simple to just build some wind turbines, natural gas plants, and so forth? Well, not exactly. Unlike oil, renewable energy cannot be funded little at a time; rather, it requires a significant initial investment—and then little cost thereafter. Texas billionaire T. Boone Pickens has run into problems with the initial investment for his long-planned wind farm.
Even the liberal Breakthrough Institute is forced to acknowledge that, in the case of California (which is considering an energy mandate), it will cost companies billions of dollars to follow through, causing them to call for the government to throw around yet more cash—money which even the most casual observer should know the federal government simply does not have.
But aside being difficult to build, an even bigger problem with renewable energy is its distribution. It is one thing to build a wind or solar farm, but it is an entirely different matter to then spread the power. Certain areas of the country are more naturally suited to alternative energy production (especially the huge wind and sun-rich areas in the south west), leaving companies owning the power farms with the problem of spreading the power around to areas of the state which fall outside those power-rich regions. Additionally, the intermittent nature of some of this ‘clean’ technology threatens the U.S. power grid, meaning that new controls will have to be developed to ensure a constant power supply.
Add further to this the fact that 2008 will be the coolest year in a decade marked by global temperature decrease—data that, no matter how the enviro-lobby will try to explain it away, stands in clear contrast to the supposed science upon which these state measures are based.
In spite of the difficulties faced by utilities, some states are forcing them to pony up fines for not meeting the high bars set. In an ironic twist of fate, the states—which are notorious for complaining about unfunded (or partly-funded) mandates from the federal government—are turning around and forcing their own utility companies to meet their own politically-driven standards.
Like the man in the parable of the unmerciful servant, they desire their unfunded/partially-funded federal mandates removed, but then turn around and place a burden upon those in their power. Adding insult to injury, Massachusetts and Connecticut have gone as far as fining the utilities back in 2006 for not meeting their fanciful standards.
But even if there was no penalty for noncompliance, or the mandates were funded, the foundational problem with this situation would not resolve itself. Namely, the market would not be allowed to work properly. By forcing companies to invest in technologies which are still questionable and under development—solely for the sake of political expediency—the states are only increasing the economic difficulties which they will be facing in the future.
Think the federal government’s bailout of Fannie and Freddie was bad?
Imagine half the states forced to significantly raise taxes in order to provide basic energy needs because they nearly destroyed utility companies by forcing them into costly and unproductive energy adventures—all in pursuit of the prevention of the unsound hypothesis of “global warming”.
Isaac MacMillen is a contributing editor of ALG News Bureau.
