PA Should Heed Europe’s Experience with Renewables

Last month the Pennsylvania Department of Environmental Protection (DEP) released Pennsylvania’s Climate Change Action plan. While touting the creation of “green jobs”, it did not advocate increasing PA’s Alternative Energy Portfolio Standards (the solution contained in HB 80) among its many recommendations. The Patriot-News noted, “The report stops short of recommending the expansion of the state’s Alternative Energy Portfolio Standards, and it is ambivalent about whether to push for carbon capture and sequestration.” Additionally the report raises questions about where the carbon would go and what it would cost.

Recent studies from European countries with large alternative energy subsidies and mandates demonstrate the failure of mandated alternative energy. RWI Essen, a research institute in Germany, released a study entitled, “Economic Impacts from the Promotion of Renewable Energies.” The report revealed:

• Germany’s solar PV industry requires unsustainable levels of subsidies and would “vanish as soon as government support is terminated.”
• Electricity consumers “ultimately bear the costs of renewable energy promotion.” The current level of subsidies increases the average household electricity prices by 7.5%.
• Government intervention prevents the industry from following market incentives for renewable energies. Viable and cost-effective emission reductions technologies (like Carbon Sequestration) are 53 times cheaper than mandating PV and wind power.
• The study concluded “we would instead regard the country’s experience as a cautionary tale of massively expensive environmental and energy policy that is devoid of economic and environmental benefits.”

A Spanish study concluded that if America decides to follow their policy of subsiding renewable energy, as President Obama has suggested, we should expect:

• A loss of 2.2 jobs for every one green job created.
• Only 1 permanent position for every 10 green jobs created.
• Massive subsidies; each green job created required approximately $800,000 (571,138 euros) in subsidies.
• Increases in either electricity rates or taxes to pay for new debt. Spain would need to increase the cost of electricity by 31% to pay for their deficit “mainly produced by subsidies to renewable (energy).”

These studies and the proposed Climate Change Action plan show that the policies promoted in HB 80 are misguided.