This RealClearMarkets article suggests President Obama should drop green energy for “real energy.” The article is focused on natural gas, instead of coal, but it still makes some excellent points.
The bottom line: households have far higher electricity bills using alternative energy … This disproportionately affects low-income Americans, who spend a higher share of their income on energy. Data from Labor Department released last September show those in the lowest fifth of the income distribution spend an average of 24 percent of income on energy, compared to 10 percent of income for those in the middle fifth, and 4 percent of income for those in the top fifth. …
Department of Energy grants and loan guarantees have been notoriously unsuccessful in attempts to make alternative energy profitable. Of the 33 energy loan guarantees made since 2009 under the Energy Department’s programs, 30, or over 90 percent, have shown signs of trouble. “Trouble” ranges from missed production goals to bankruptcy filings.
Of the companies that received loan guarantees, three have filed for bankruptcy so far (Solyndra, Abound Solar, and Beacon Power), two have reported operating losses (AREVA, Nevada Geothermal), at least one (Tesla Motors) has missed production goals, one (BrightSource) has cancelled its IPO, and at least 23 have struggled with poor credit ratings.
Of companies that received grants, three have filed for bankruptcy: A123, Ener1, and Evergreen Solar. Losses have been reported at grant recipients Ecototality and Smith Electric (which also cancelled an IPO). LG Chem’s Compact Power has placed workers on rotating furloughs due to insufficient demand for lithium ion batteries. Energy Conversion Devices, which received a $13.3 million stimulus tax credit in January 2010, filed for bankruptcy in February 2012.
I don’t know that we need to “drop” green energy, but we certainly shouldn’t be setting up our energy policy to pick winners and losers like we are today. We also shouldn’t be legislating and regulating the use of one energy source at the expense of other, better competitors.
Let energy producers compete on equal grounds and stop attacking one form of energy while propping up others.