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If you want green energy, be prepared to pay for it

If you want green energy, be prepared to pay for it

Fred Birnbaum
August 21, 2014
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August 21, 2014

Idahoans groaning under the weight of their summer electric bills need to better understand the implications of so-called “green energy,” pushed by the environmental community.

Currently, for example, Boise residents pay Idaho Power a base rate of 8.57 cents per KWh (non-summer rates are 7.24 cents per KWh). There are other adjustments and fees, but these are the base rates.

The U.S. Department of Energy’s Energy Information Administration provides a table of rates per state of the total delivered price. The May data pegs Idaho residential rates at 9.64 cents per KWh, with only hydro-power heavy Washington lower at 8.93 cents. The national average is 33 percent higher at 12.84 cents.

When you look at the range for the lower 48 states, states at the forefront of embracing renewable energy mandates are higher still. California’s rates are 71 percent higher than Idaho’s, New
York’s are 114 percent higher and the New England states as a group are 88 percent higher.

You could almost construct a correlation that showed that “Big Government environmentalism” leaning states have higher electric rates for many reasons including renewable energy portfolio standards. For example, coal-heavy West Virginia’s rates are 46 percent lower than adjacent Maryland’s.

The phenomena just described has a global angle as well. According to the International Energy Agency, which has global data for 2011, the U.S. is at 12 cents per KWh. What are the rates for those countries in Europe that are constantly goading the U.S. to “fight climate change” and reduce greenhouse gases? In France 19 cents, the UK 20 cents, Italy 28 cents and Germany, which is considered the pre-eminent large-scale green nation, 35 cents. Even if you adjust prices relative to purchasing power, Germany is still at 32 cents.

The central problem that environmentalists shy away from is that green energy solutions have huge “intermittency,” problems that Paul Joskow of MIT has pointed out (The Economist, July 26, 2014, p. 63). The sun does not always shine and the wind does not always blow. So, for a given amount of electricity production with the same plant capacity, you would need seven solar plants or four wind farms to the produce the same electricity as one coal plant.

When you consider the high costs of green energy, perhaps one conclusion is that environmentalists simply want to make energy expensive but attempt to conceal their motives with high-minded speeches about saving the planet.

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