U.S. renewable energy has made impressive strides in recent years
“According to a new report from the U.S. Department of Energy, solar power employs more people than coal, oil and gas combined.
Last year, solar power accounted for 43 percent of the Electric Power Generation sector’s workforce, while fossil fuels combined employed 22 percent. The statistic will be welcomed with open arms by those trying to refute Donald Trump’s assertion that renewable energy projects are bad news for the U.S. economy.
Around 374,000 people were employed in solar energy, according to the report while generation through fossil fuels had a workforce of just over 187,000. The solar boom can be attributed to construction work associated with expanding generation capacity.
The report states that the employment gap is actually growing with net coal generation decreasing 53 percent over the last 10 years. During the same period of time, electricity generation through gas expanded 33 percent while solar went up by an impressive 5,000 percent.” — Niall McCarthy | Statista
Solar Power and Wind Power combine to provide 475,545 U.S. jobs — while Nuclear Power and Fossil FuelPower generation combine to provide only 255,293 U.S. jobs — but in recent years the Fossil Fuel industry gets 4 times more subsidy than Renewable Energy
Renewable Energy = Clean Air and Twice as many Jobs on 1/4 the Subsidy!
Here is a look at historical U.S. federal subsidies paid from 1918 to 2009 for various energy producers.
What Do Americans Think About Fossil Fuel vs. Renewable Energy?
Solar power and wind power (alone!) employ almost twice as many Americans as all nuclear and all fossil fuel power plants combined, but renewable energy gets only one-quarter of the subsidies in from 2010 onward.
Which might be a factor in the minds of Americans who look forward to renewable energy meeting their future energy demand.
Renewable Energy Continues to Grow in the U.S.
Despite the low subsidy amounts paid to renewable energy in the United States, non-hydropower energy continues on its growth trajectory and it’s now cheaper to build new solar capacity, than to build new coal capacity.
New Solar Now Cheaper Than New Coal
Costs for new solar power plants continue to plummet (without subsidy) vs. new coal power plants (with a small subsidy) is reflected in the Levelized Cost of Electricity (LCOE) per Kilowatt Hour price.
Billions of Gallons of Water Used Monthly by Conventional Energy
Many coal-fired power plants and several nuclear power plants produce well over 1000MW (1 GW) of electricity and it is easy to extrapolate their water usage.
For instance, a 1.6 GigaWatt(GW) coal-fired power plant (for the purposes of this discussion there’s a 1.6GW coal-fired power plant in Texas) uses 1,760,000 gallons of water per hour, while an equivalent-sized nuclear power plant uses 1,280,000 gallons of water per hour.
Meanwhile, a natural-gas-fired power plant producing the same 1.6GW of electricity would consume 480,000 gallons per hour, while a 1.6GW solar or wind power would consume zero gallons per hour.
Of course hydro-power does not consume any water during its decades of reliable power production, water merely falls through turbines and back into the river a bit further downstream — although during the construction of the dam, spillways, and hydro-electric turbine rooms, millions of gallons of water are used to make the concrete.
The Future of Energy in the United States
Renewable generation capacity expected to account for most 2016 capacity additions in the U.S.
The chart below shows just how much wind power in the United States has grown in recent years.
The chart below shows the expected growth of solar photovoltaic power in the United States (does not include solar thermal)
The chart below displays total utility-scale capacity additions from 2010 to 2016. For the third consecutive year, more than half of the capacity additions are renewable technologies, especially wind and solar.
From 2013 through 2040, U.S. electricity demand is expected to grow approximately 1 trillion kiloWatt hours(kWh) with natural gas and renewable energy showing steady growth, while coal-fired power generation and nuclear power show slight declines according to the U.S. Energy Information Administration.
If the United States converted their existing coal-fired power generation to natural gas by 2020, the U.S. could easily meet every international and domestic clean air target until 2050 as coal burns 10,000 times ‘dirtier’ (anthracite, or black coal) to 1,000,000 times ‘dirtier’ (lignite, or brown coal) when compared to natural gas.
It goes without saying that if the United States replaced coal-fired power generation with renewable energy, it would surpass every U.S. international and domestic clean air target, lower U.S. heathcare and infrastructure spending by billions of dollars annually, save the U.S. billions of gallons of fresh water per month, provide millions of good-paying jobs for American workers — and prove the United States is still an exceptional power in the 21st-century. Not bad!
Former President of the United States Jimmy Carter leases a 10-acre site to SolAmerica Energy for the next 25 years to harvest the power of the Sun
Atlanta-based SolAmerica Energy, a leading solar, development and construction firm, launches a 1.3MW solar array on President Carter’s Farm in Plains, Georgia.
Former President Carter leased a 10-acre site in his hometown to SolAmerica for development of the 1.3 MW solar project, which will provide over 50% of the power needs of the City of Plains.
Carter, an early advocate and leader of the renewable energy movement during his tenure in the White House, commented;
“Rosalynn and I are very pleased to be part of SolAmerica’s exciting solar project in Plains. Distributed, clean energy generation is critical to meeting growing energy needs around the world while fighting the effects of climate change. I am encouraged by the tremendous progress that solar and other clean energy solutions have made in recent years and expect those trends to continue.”
President Carter created the Department of Energy and the Federal Energy Regulatory Commission (FERC), and signed the Public Utility Regulatory Act (PURPA), which became catalysts for the advancement of renewable energy in the U.S.
Carter was also the first president to put solar panels on the White House.
SolAmerica executive vice president George Mori added,
“We are honored to work with President Carter and his family on this project in Plains, as President Carter’s leadership on renewable energy matters is well known and much appreciated in our industry.
Through a 25-year Power Purchase Agreement with Georgia Power, this project will help expand the growth of renewable energy assets in Georgia, while contributing to the overall economy of Plains.”
“There remains a great deal of untapped potential in renewable energy in Georgia and elsewhere in the U.S. We believe distributed solar projects like the Plains project will play a big role in fueling the energy needs of generations to come.”
SolAmerica developed, engineered and installed the single-axis tracker solar array on Carter’s property. Over the next 25 years, the system is projected to generate over 55 million kilowatt hours of clean energy in Plains.
To contact SolAmerica to find out how they can help your farm, commercial, or residential property to save money on electricity costs and help you to become more energy independent, visit: SolAmericaenergy.com
A hundred years ago in America, the federal government decided to help a new industry take its first baby-steps by legislating oil and gas subsidies which were paid for by increased citizen taxation.
It’s commonly done by governments everywhere and it’s not the worst thing for a nation to do.
Here’s how that works: (1) A new industry appears (2) the government sees economic potential (3) citizens are told they must pay more tax to support the new industry (4) the subsidies continue long after they’re no longer required (5) the subsidies tend to increase over time and expand into other areas of the business (6) until the subsidies reach obscene amounts and the taxpayers revolt.
In short: Subsidies are a ‘good thing’ — until they aren’t
Energy subsidies accumulate over time
Arithmetic tells us that U.S. oil & gas subsidies total $442 billion from 1918-2009.
It’s worse if you add the additional $80 billion/yr in U.S. oil & gas subsidies paid from 2010-2017, which total $560 billion.
Here’s what U.S. oil & gas subsidies look like when totaled over the entire 1918-2017 timeframe: $1,002,260,000,000.
U.S. oil and gas subsidies since 1918 total one trillion dollars
And U.S. taxpayers paid every penny. That’s a trillion dollars of income tax and fuel tax paid by U.S. citizens to subsidize American oil & gas companies since 1918.
Subsidies are a fine thing for new industries taking their first baby-steps. Wherever the federal government sees economic potential for a new industry, subsidies are the way to grow the opportunity and help stabilize the new industry UNTIL it can stand on its own two feet.
But Mature Industries Don’t Need Subsidies
The problem with oil & gas subsidies is that by 1950 they were 100% redundant. No longer needed. At all.
When mature industries continue to receive taxpayer-funded subsidies long after the original need for them disappears, that revenue goes to support pro-industry advertising, pro-industry organizations and pro-industry politicians.
In that way, some $80 billion/yr in oil & gas subsidies became available for pro-industry causes as it was no longer required to support a new industry taking its first steps.
Note: Not all oil and gas subsidies are bad! Additional subsidies paid for research on ‘cleaner-burning’ fuels via high-tech additives, a transformation that began slowly in the 1970’s and continues — to remove lead from gasoline, and for catalytic converter research in the 1980’s, are two such examples. Billions of dollars were well spent and were very cost-effective. But once the research has been done and the clean-burning fuel goals have been achieved, no reason exists to continue to pay such subsidies.
Except for the dollar amounts, much that applies to U.S. oil and gas subsidies also applies to U.S. nuclear power subsidies.
So let’s skip directly to the nuclear power numbers, shall we?
Simple arithmetic tells us that U.S. nuclear power subsidies amounted to $182 billion from 1947-2009.
It’s worse if you add the additional $102 billion (conservative estimate) in U.S. nuclear power subsidies that were paid by taxpayers from 2009-2017.
Here’s what all (federal) U.S. nuclear power subsidies look like when totaled over the entire 1947-2017 timeframe: $284 billion.
U.S. nuclear power subsidies since 1947 total $284 billion
But if one were to include all nuclear power subsidy costs including; safe storage, disposal, or reprocessing of spent fuel, transportation of spent fuel to other countries for safe storage or reprocessing, the decommissioning of nuclear power sites such as Hanford, the cleanup and cost of replacement electricity due to U.S. nuclear power plant malfunctions, and future reactor design spending, nuclear power subsidies could total $500 billion. Perhaps as much as $1 trillion.
NOTE: That’s not including billions of dollars worth of grants awarded by the federal government for new nuclear power reactor designs to replace America’s aging reactors. Nor does it include the tens of billions paid to store and defend so-called ‘spent fuel’ which is highly radioactive and useful to terrorists. Nor does it include reprocessing costs for spent fuel. Nor does it included shipping costs to ship spent fuel to other countries for storage or reprocessing. Nor would it include any costs associated with nuclear power plant malfunctions. Nor would it include any costs associated with nuclear powered US Navy ships. Due to the sensitive nature of nuclear materials some information is difficult to obtain, therefore, the $102 billion nuclear power subsidies figure used for the 2009-2017 timeframe is an estimate.
Biofuels are a new-ish industry. It’s about where the U.S. oil & gas industry were, in their first 20-years. It’s an industry where subsidies can make a difference to get the thing up-and-running and add stability to the new industry.
Biofuel energy subsidy in the early years was subsidized at $1.00 per gallon, which then declined to $.66 per gallon, but since 2011 has fallen to $.45 per gallon.
Total U.S. biofuel subsidies amount to $31 billion from 1980-2009 and an additional $65 billion from 2010-2017.
For a grand total of $96 billion from 1980 to 2017.
U.S. biofuel subsidies have totaled almost $100 billion since 1980
Note: The original U.S. biofuel subsidies enacted by President Carter during the 1970’s fuel crisis were later expanded to allow U.S. biofuel producers to compete with the much larger and more heavily subsidized Brazilian biofuel producers.
Coal subsidies follow the pattern described in the introduction to this post (subsidy steps 1 to 6) and subsidy costs are in the same neighborhood as oil & gas.
But U.S. coal subsidies in all its forms — including so-called ‘Externalities’ might total half a trillion dollars annually
Here is what a landmark Harvard Medicine study said about the externality costs of U.S. coal:
“Each stage in the life cycle of coal—extraction, transport, processing, and combustion—generates a waste stream and carries multiple hazards for health and the environment.
These costs are external to the coal industry and are thus often considered “externalities.”
We estimate that the life cycle effects of coal and the waste stream generated are costing the U.S. public a third to one-half of a trillion dollars annually.
Many of these so-called externalities are… cumulative.
This study illustrates the most vexing problem with U.S. energy extraction, refining, processing, storage, end use, and decommissioning of energy sites — energy ‘externalities’. And such externalities aren’t limited to the coal industry.
Energy production externalities (also called ‘Indirect Subsidies’) may cost America $1 trillion per year due to higher healthcare and infrastructure maintenance costs.
Damage to infrastructure arrives in the acid rain falling downwind from fossil fuel power stations, causing damage to bridges, buildings, and roads constructed with concrete (so-called concrete spalling) and causes paint damage on cars and trucks, and is responsible for crop losses downwind or downstream from fossil fuel extraction sites or power stations, and harms aquatic life found in rivers and coastal areas near river outlets.
Terms to remember: Energy ‘kind’ and ‘type’
There are only two ‘kinds’ of energy: Non-renewable and Renewable energy.
There are many ‘types’ of energy: Natural gas-fired, oil-fired, coal-fired, nuclear energy, solar photovoltaic, solar thermal, wind turbine, hydro-electric, ocean thermal, ocean wave, ocean tidal, biomass, wood-burning, and pellet-burning.
The trend of large subsidies in a sector like the energy sector, is that subsidies reward less efficient energy producers and punish more efficient producers in relative terms.
“Just pump it Fred, we’re getting our subsidy money per barrel of oil, who cares if it’s #4 sour crude oil? We get paid to pump oil, not look for better quality oil.”
Although there’s a separate ‘oil exploration’ subsidy too.
And let’s not forget the more ‘sour’ the crude oil, the more processing it requires at the refinery, and because #4 sour is very tough on oil refinery maintenance budgets, it further increases costs at the gas pump.
The more oil you pump of whatever quality, the more subsidy money you get — and that isn’t the way to maximize the efficiency of money in the energy market.
The oil industry delivers an easy example, but every energy subsidy scheme changes the behavior of the principals involved towards lower quality energy, whether it’s subsidized non-renewable energy or subsidized renewable energy.
In the primary energy segment (electricity and district heating) the type of energy varies by region.
Hydro-electric, coal-fired, and nuclear power are astonishingly costly to build and couldn’t have been built without massive subsidies. And even with huge subsidies for R&D, construction, millions of acres of land grants, generous tax incentives and more, some of those energy types still require small per kW/h subsidies to compete in the marketplace. In their favor, all of these have been extremely reliable primary energy producers for decades, but are mature industries that no longer require subsidies as financing such projects in the 21st century is considered routine. But it wasn’t always so.
In secondary energy (transportation) oil and gas infrastructure is also costly to build and the necessary infrastructure couldn’t have been built without massive subsidies. Yet, with sufficient refinery capacity already available there is little need for new refinery capacity, and today’s fuel prices support easy financing for future capacity additions.
Especially for vertically integrated oil companies that own their oil concessions (oil fields) their own distribution system (pipelines, or rarely, rail) and their own refineries, these can thrive during times of low crude oil prices.
Removing oil & gas subsidies would cause oil companies to become vertically integrated with no loss in profits. But why bother, when there’s no incentive due to a high subsidy scheme?
That won’t be the only change. Every subsequent change to the business would necessarily be designed to improve the overall efficiency of the company, sans-subsidies. That’s been missing since 1918.
By leveling the playing field for all kinds and types of energy, the most efficient energy kind and type will become king, and energy investors will earn more profit. (Because profits are earned on the ‘spread’ — the difference between what energy costs to produce and what it can be sold for. Subsidies make markets significantly less efficient and muddy the waters)
In summary: Removing energy subsidies will cause every energy producer to concentrate their efforts on the most efficient kind and type of energy in their region of the country, instead of choosing their energy kind and type by how many subsidy dollars they can capture via their energy choice.
President-elect Donald Trump, please tear down these subsidies!
And let the marketplace determine the most efficient energy.
Federal energy subsidies should return to their proper place. That is; When the federal government sees a new industry with economic potential; To invest, subsidize, and promote that new industry using taxpayer dollars for only as long as it remains a new industry. And not one day longer.
Markets are perfectly efficient when left to their own devices. Massive, taxpayer-funded subsidies for mature industries only serve to warp the markets and punish the most cost-efficient U.S. energy producers.
People either believe in free markets or they don’t
We can’t say we believe in free markets AND THEN massively intervene in the market with humongous, taxpayer-funded energy subsidies for some kinds and types of energy, but not other kinds and types energy.
With the greatest respect Mr. President-elect, I urge you to allow all U.S. energy producers to compete in a free market by phasing-out energy subsidies for every kind and type of energy over the next five years.
In late 2015, report after report after report emerged showing that coal consumption on the global scale was headed for an impressive decline, and possibly that dependence on coal had peaked all over the world. For example, China, one of the largest consumers of coal on the planet, was rapidly decreasing their dependence on the fossil fuel, and when this decline was paired with declining reliance in other countries and here in the U.S., it made the coal industry significantly weaker…