Highly informed sources (don’t you love that phrase) tell us that Senate majority leader Harry “Hands-Off-Yucca-Mountain” Reid will be pushing for the Senate to adopt a national renewable energy portfolio within the next two weeks.
Reid has reportedly told Senator Jeff Bingaman (N.M.), chairman of the Senate Energy and Natural Resource Committee, he wants a bill on the Senate floor within two weeks. Bingaman is balking at the timetable but is not opposed to the bill.
And so the Senate may soon be leading us down the path trodden by California (the state with the $40 billion budget deficit) on its way to the California Electrical Shortage of 2000. Democrats have been historically feckless on energy, but apparently you ain’t seen nothin’ yet.
What is a renewable portfolio? Well, it’s what we used to call an “unfunded mandate.” The premise is that the government has perfect foresight on where our energy future is going and as good legislators it’s their responsibility to hasten its arrival. Corporations and utilities, you see, are generally too greedy and stupid to perceive the future so they have to be prodded on their way. In their wisdom, the legislators will mandate that by 2000-whatever the state or nation shall derive XX percent of its electricity from “renewable sources.” It’s up to the utilities to do the job. California pioneered this strategy in the 1990s but 26 states have now followed suit, although four make it only voluntary.
All this is likely to make electricity more expensive, which is what is holding the utilities back. Solar electricity now costs about 24 cents per kilowatt-hour and wind 14 cents, as opposed to 5 cents for coal or natural gas. Utilities will pay the bills but then will inevitably pass them along to consumers. California now pays the highest electrical rates in the country, precisely because it will not allow coal or nuclear plants but has pursued a 30-year strategy to develop renewable energy.
The best criticism of renewable portfolio standards (“RPS” for short) comes from Fred Krupp, executive director of Environmental Defense, who is (please don’t tell anyone) a closet conservative. In his book, Earth: The Sequel, Krupp writes: “Mandates presume that the government already knows the best way to proceed on energy. But the government doesn’t know any better than anyone else. The best thing to do is to level the playing field, through something like a carbon tax or cap-and-trade, and then let the market sort things out.” Krupp is talking here of course about reducing carbon emissions and I happen to agree with him. Democratic politicians, however, don’t like leaving decisions in the hands of ordinary people and so we are likely to get an RPS instead.
So just what is a “renewable” source of energy? Well, it depends on whom you ask. Wind is definitely renewable (although some people are pointing out that if we put up too many windmills we may start changing wind patterns, which will affect the climate). Solar heat and electricity are renewable because the sun shines every day. Geothermal energy is renewable because the heat of the earth will always be with us. It is generated by the breakdown of uranium and thorium atoms in the earth’s crust. (That’s why I titled my book on nuclear power Terrestrial Energy.) If we take those same uranium and thorium atoms and put them in something called a “nuclear reactor,” however, that is not renewable because — well, because it isn’t, that’s why.
Things get a little fuzzier when we get to hydroelectricity and biofuels. Hydroelectric dams have been with us since the 19th century and provided 40 percent of our electricity in 1940. They also provided the environmental movement with its first cause for objection. The Sierra Club opposed construction of the Hetch-Hetchy Dam in 1911 and is still campaigning to tear it down even though it provides water and electricity to 2.5 million people in the San Francisco area. The Club also opposed the Glen Canyon Dam in the 1960s, proposing a nuclear plant in its place. Now someone has come along forty years later, however, and said hydroelectricity is renewable energy! That can’t be true. So environmental groups have decided only small dams — “low-head hydro” — are authentically renewable. Big dams don’t count. Whether large hydro should be included in a renewable mandate is always a matter of fierce debate.
Biofuel, on the other hand, has to be one of the most irrational pursuits ever undertaken by a mature industrial nation. The idea is that burning a portion of our crops for fuel each year is somehow “sustainable.” All this ignores that humanity has spent most of its history trying to build a sustainable agriculture, but that’s another story. We’re past that now. So each year we now burn one-quarter of the corn crop to feed our gas tanks and are headed for more. All this has created havoc and food riots in that other portion of the world that still practices agriculture. The United Nations Food and Agricultural Organization is calling biofuels a “crime against humanity,” but what do they know? They just don’t share our vision of a clean and sustainable energy future.
Thus, in one of the more bizarre developments, Midwestern utilities have now started substituting wood chips for coal on the basis that it is “more sustainable.” Wood has only half the energy density of coal and creates just as much carbon dioxide and air pollution. Lung disease is the leading cause of death around the world because people in underdeveloped countries spend their whole lives breathing wood smoke. Moreover, it would take a 1000-acre forest to feed one 1000-MW power plant on a sustainable basis. Yet we are reverting from coal to wood in order to protect the environment.
California began pursing a renewable strategy in 1980 when Governor Jerry Brown decided to pursue Amory Lovins’ “soft path.” From 1980 to 2000 the state built no new major power plants. (Diablo Canyon Nuclear Units 1 and 2, started in the 1960s, were finally brought on line in 1984 and 1985.) The Golden State pursued the most aggressive conservation-and-renewables program in the nation. It turned every garbage dump in the state into a 1-MW methane plant. Businesses as small as nursing homes and golf clubs were encouraged to generate their own electricity, capturing the steam for heat. The state developed its remarkable geothermal resources. (Geothermal vents are common along earthquake fault lines.) It built what was the largest windmill farm in the country at Altamont Pass. By 2000 it had the lowest per-capita electrical consumption in the country, the highest percentage of non-hydro renewables (10 percent as opposed to 1 percent nationwide) — and not enough electricity to run its traffic lights.
Urban legend now has it that Enron actually caused the California Electrical Shortage. The company did play games in order to dodge state price controls, but the state’s electrical shortage was caused by a shortage of electricity. California only recovered by tossing aside environmental review and throwing up 12,000 MW of natural gas generators over the next three years. Except for renewables, however, natural gas is the most expensive way to generate electricity. So Google has moved its server farms to Oregon and North Carolina, Cisco is expanding into Texas, and manufacturers are generally fleeing the state as fast as they can. As a result, the California economy is in a shambles.
And this is what Harry Reid now wants to do for the rest of the country. Hang on, it’s going to be a heck of a ride.