Does it help the environment if I consume more resources than necessary to avail myself of a product? Of course not - the whole point of conservation is to use the minimum amount of resources possible.
So explain to me why it is considered "earth friendly," or "green" to install hugely cost ineffecient wind or solar systems to produce energy for my home?
The cost of any product reflects the amount of resources that went into producing it. So if an alternative energy system costs more than the energy I can get from the power grid, that means I have HARMED the environment (since I've intentionally used more resources than necessary to produce my electricity) rather than helped it.
Why don't people get this? Do people really not understand economics?
The Oregonian today has a front page article about the trend toward wind and solar systems in homes. They interview homeowners who have installed the systems and even give some thumbnail cost/savings examples.
Of course the entire premise of the more-than-a-full page spread is that installing alternative electricity production systems is environment friendly, and the people who do it are doing their part to save the earth.
Guess what? The exact opposite is true.
Would you invest $23,000 to get $618 per year? If so, please contact me. One of the people profiled in the article installed a wind turbine system for that cost and return. Now, of course, she got $12,000 in subsidies, but even after the subsidies it is a marginal economic return.
But it is the unsubsidized cost of the system that is relevant when we consider the impact on the earth. The cost of the system reflects the resources of the planet involved in producing it. In the final analysis, the bulk of what anything costs is the energy it took to make it.
The wind turbines had to be manufactured, the raw materials mined, grown and fabricated. Transportation, installation - a large part of the cost is energy.
So spending $23,000 in energy to save $618 in energy makes no sense at all, even from an environmental viewpoint.
Nowhere in the Oregonian's big article was the point made that even with the huge subsidies in every one of their profiles the alternative energy system was a bad investment. And they certainly didn't make the point that a bad economic investment means it is also a bad environmental investment.
Take a look at the numbers they gave in their examples:
Wind turbine system:
Cost: $23,208
Subsidy: $12,000
Annual savings: $618
This is a 2.6% return. No rational business would make this investment. Especially since it ignores maintenance and replacement costs.
Even after the $12,000 subsidy the return is a paltry 5.5%.
The other systms profiled in the article were similar - solar systems for electricity, water heating and heat all had 5-6% annual returns after the subsidy, ignoring maintenance and replacement costs.
This is not "green."
But it does allow the owners to significantly increase their "smug coefficients," not to mention their "moral preening" multiplier.
This quote fromthe wind turbine owner:
"I've always worried about things like this more than others," he said. "The point is, even before they run out, supplies will be low, and there will be misery all around -- economic, political, environmental.
"Something has to happen. I haven't seen a lot of movement by government. Why not me?"
I gotta get this guys phone number. I have some investments I want to sell him.
4 comments:
You are assuming that the selling price accurately reflects the cost of producing the products in question. There's no basis for that assumption. What if the majority of the cost involved in production is labor? It doesn't seem to me that human labor necessarily has negative impact on the environment.
I have observed that over the past half-century we have been moving more toward "political" (emotional) motives for our actions as opposed to purely economic (or rational) motivations. It seems to me that this may be due in a large part to our not being taught how to think rationally (or to reason) in our education systems -- or perhaps I should say being taught how to think irrationally (or politically "correctly"). If what I am seeing is true, it would be indicative of a society that is bonkers, and getting more so every day. Depressing thought isn't it?
Rob,
I for one understand economics.
I also have looked at solar, wind, nuke, and biofuels extensively. They make alot of sense to me personally. Specifically if your concerned with global warming and the CO2 emmissions that result from every other fuel but solar, wind or nuke.
Many rational businesses have opted for wind or solar power. There are many times that using one of these options makes perfect sense.
First of all the money spent is going directly into the US economy instead of exported. The solar and wind manufactured in the US is in one of the most expesive labor market in the world. The majority of the cost of most specialized construction jobs is labor.
Compound this with the reality that to purchase imported oil or increasingly imported natural gas is to directly export our nation's wealth.
It also doesn't hurt that wind and solar remove your personal dependence on arab oil. How many more AK-47's do you want to buy for people who want you dead?
When you talk about subsidy your assuming that hydrocarbons (petro) aren't subsidized. How much federal support will it take to realize ANWR if a green light was offered? How much federal subsidy has gone into the natural gas infrastructure that currently is over taxed with little new supplies likely? How much does the DoE put in expanding nukes? Billions straight from the tax payers coffers as opposed to an income tax break from the individual making the investment.
As for the coverage in the Oregonian. You of all people shouldn't fault someone based on how the Oregonian covers or explains it. How many times have you seen yourself or other conservatives pushed off their real message by a journalists/editor's story angle?
Second thought though - reading the quote it says it all. To summarize what your real problem might be the quote really provides one message: 'I did something I believe in, now government should make everyone do it.'
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