Port: Are you ready for a winter soaring energy prices?
By “we” I mean those of us who view as reckless policies aimed at closure of coal mines and coal-fired power plants through punitive regulations as well as massive subsidies and mandates for intermittent renewables like wind and solar.
By “that” I mean the growing recognition that renewables cannot provide us with the reliability and price stability of electricity that we expect, even when bolstered by natural gas.
Who knew that making our electricity grid dependent on energy sources that depend on the weather (the wind is blowing? Is the sun shining?) And the ever-volatile natural gas markets would be wrong?
Many observers, including this one. When we made this argument, we were greeted with derision by those who claimed that we were only looking to protect Big Coal’s bottom line. Coal is dead, they tell us, so you might as well get used to it.
But the chickens come home to roost.
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Here is a fact by Jinjoo Lee of The Wall Street Journal: “The United States exported 52.5% more coal in the second quarter than a year earlier, according to S&P Global Market Intelligence.”
Why are coal exports increasing? Because places like Europe, which has spent decades implementing policies moving away from coal to wind, solar and natural gas, are now out of energy. The wind didn’t blow enough to keep the lights on. “The sudden slowdown in wind power generation off the coast of the UK in recent weeks has shaken regional energy markets”, the Wall Street Journal reported last week. “Gas and coal-fired power plants have been called in to fill the wind deficit.”
But there is also a shortage of gas. “The biggest problem is Europe, where supply is at an all time high for this time of year”, CNBC Reports.
The world is now looking to America and its prodigious coal and natural gas (we now export around 10% of our natural gas production).
Except that there has been a political movement here to change our energy policies in the direction of Europe.
We are also closing coal-fired power stations and coal mines and making ourselves more dependent on wind, solar and natural gas.
Now, as we move into the winter months when reliable energy is crucial to keeping the heaters and lights on, we may be on the verge of experiencing a massive increase in the prices of our utility bills.
Coal Creek Station Power Plant near Underwood, ND Special for the Forum
Not only because of our flawed policies, but also because of those of Europe.
“Natural gas prices have jumped over 35% in the past month as concerns grow there isn’t enough gas stored for the winter if temperatures are particularly cold in the northern hemisphere “, CNBC Reports.
Usually, energy markets operate like any other. Higher prices stimulate supply until equilibrium is found. But in this situation, the policy restricted the ability to increase supply.
How easy is it to open a new coal mine amid the activism and strict regulatory regime in America today?
How about a new gas pipeline?
If we can’t increase the supply, prices will skyrocket. They will skyrocket when seasonal weather conditions force us to rely on basic energy like coal and gas.
No reasonable person is against finding new and better ways to generate energy. The problem is not wind and solar technology. Politicians and activists have manipulated energy markets in favor of these sources while ignoring their shortcomings to produce results rooted in ideology, not reality.
Remember that when it is very hot outside or cold and we need energy the most, it’s not the sun and the wind that keep the lights on.
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Rob Port, Founder of SayAnythingBlog.com, is a Forum Communications commentator. Contact him on Twitter at @robport or by email at [email protected]