Politics and economics
Estimated excess costs of currently installed weather dependent renewables for the EU are 2,000 billion euros; for the US the cost is put at $800 billion. The data, compiled by Ed Hoskins, uses US Energy Information cost estimates for renewables and alternative fuel sources.
According to the International Energy Agency, solar, wind, wave, and bio-energy produce 9.8 per cent of electricity in the OECD, and this is possible only because of subsidies which amount to more than $215 billion this year. Fatih Birol, the IEA’s executive director, said, “Global investment in renewables and energy efficiency declined by about 3 percent last year, and more importantly it could slow down once again this year.” He added, “This is a worrying trend, especially when we think of our clean-energy transition goals and the implications for energy security, climate change and air pollution.”
The Global CCS Institute a lobby body with no published accounts that is largely funded by the Australian Government to promote carbon capture and storage – a forlorn attempt to make fossil fuel generation compatible with a global carbon tax. It reports that the UN Environment Program Report estimates that national pledges may bring just one third of the reduction in emissions required by 2030 and that the Paris target cannot be met. Naturally the sinecured staffed Institute sees CCS as the solution, though the process has cost billions of dollars for no worthwhile reductions in emissions.
Concerns that carbon-sparing energy investment is flagging are endorsed by Goldman Sachs which estimates worldwide solar installations could decrease by 24 percent this year. Bloomberg NEF forecast a 3 percent contraction in solar and Credit Suisse predicted a 17 percent decline after China announced it will be reducing its domestic subsidies.
These green promoters would have been displeased by the Texas Public Utility Commission rejection of the subsidies required for Wind Catcher, the biggest ever proposed wind farm at 2 GW, spread over an area twice the size of Singapore and costing $4.5 billion.
Australia’s competition authority, the ACCC put out an advisory paper on electricity. It had merit in recognising the political destruction of the energy market and one of its recommendations called for a government guarantee for a new coal power station since investors can no longer trust politicians. Among the beneficiaries of such subsidies is wind farmer Infigen, which reported revenue of $200 million this year. $120 million of this is subsidies and much of the rest boosted by subsidy-forced plant closures. Directors paid themselves $11.2 million in 2017.
Among its other recommendations, the ACCC called for the removal of roof-top subsidies by 2021. In the UK, subsidies to roof top solar were cut in 2016 leading to a drastic reduction in up-take. UK subsidies are now to be totally eliminated in April 2019 and demand for the panels has collapsed.
Former PM Tony Abbott delivered an address to the Australian Environment Foundation that eviscerated the Australian accession to the Paris Agreement and the exacerbation to the on-going damage caused by renewable subsidies. He seeks to unwind those measures and publicity of this is providing excuses for state governments to reject the phony “National Energy Guarantee” (NEG) promoted by the Turnbull Government’s Energy Security Board (ESB). The Australian Environment Foundation’s submission to the ESB on the matter was, predictably, disregarded.
The ESB recommendations were leaked by the politicians and I demonstrated here and here that their core is a carbon tax and that the proposal’s associated modelling was implausible and self-contradictory. Among the modelled outcome is that prices will markedly fall five years from now and that new capacity growth will come exclusively from roof-top solar, a finding that is oblivious to the ACCC recommendations for the removal of roof-top solar subsidies!
Augmenting the subsidies Australian governments extract from energy consumers are subsidies from the budget, among which are those to the Clean Energy Finance Corporation which boasts it will waste over $2 billion this year in uncommercial loans and claims to have facilitated $15 billion of such spending over the past five years.
In Canada, Ontario Premier Doug Ford on Tuesday cancelled what amounts to a $2 billion a year tax on the Province’s consumers by scrapping all of the government subsidy programs funded by former premier Kathleen Wynne’s cap-and-trade scheme. Prime Minister Trudeau has responded with a review of payments to the Provincial Government, though this may not be effected prior to national elections.
And, quelle surprise! The US EU summit in Washington released a joint communique in which no mention was made of climate change being “the greatest threat to the world”.
No such luck for the developing world, where the World Bank is diverting 30 per cent of funding ($20 billion last year) to climate related activities in line with the Paris Agreement. Such a waste – and the recipients will be expected to pay back most of the money.
