|Big Reliance on Fossil Fuels Makes Little Economic Sense
By Susan McKay
|Old Giants Fear Alternative Surplus, Not Oil Shortage
Conglomerate powerbrokers that own, sell and regulate fossil fuels are the people that truly benefit from continued dependence on these limited resources. As we have seen time and again, when the price of oil increases, it is the consumer (individuals and businesses) who foots the bill. BP, Exxon, and the rest continue to make record profits. Utility companies increase rates at will because, for the most part, they are the only game in town. Wouldn't these companies be singing a different tune if consumers had open access to energy alternatives?
Renewable energy is viable and we do have access to it. Yet a powerful cartel of traditional energy giants are suppressing it. It is ironic that many so-called pro-business, let-the-market-decide advocates are doing their best to quell segments of the energy industry and regulate it to their portfolio's advantage.
A prime example are "curtailment fees" paid by utility companies to stop alternative power sources for offering service. This has been going on in California during the recent energy crisis.
Until a few months ago, Southern California Edison was paying the wind farms curtailment fees not to run a certain number of turbines. The wind farmers were happy because the amounts they were paid not to generate electricity were the same as what they would have received if the turbines were feeding power into the system.
"If people knew there wouldn't be a power shortage if all the wind farms could work at capacity, then something might just happen to get the lines built to carry our power. The way things are, it just don't make any sense." Mike Burns, Wind Farm Manager [Common Cause 3/31/01].
Renewables Create New Business, Jobs
For those who worry that alternative energy will put people in fossil fuel related industries out of work, the concern is not completely unfounded. This may happen to some degree. Yet it would be no different than how automation changed the auto industry twenty years ago, or how computers and the Internet are reshaping business today. What's more, jobs created in the renewable sector are expected to counter and exceed opportunities that exist in the fossil fuel sector today. There is no sound reason not to pursue technology that will improve our lives and economy.
It is estimated that every $100 million in direct PV sales help support or create 3,800 US jobs. In 1995, the direct and indirect impact of PV's alone was $534 million. Nearly 200,000 people are now directly or indirectly employed in the PV industry.
More than fifty businesses directly related to wind energy employ 1,200 workers in California. Recently, 4,300 jobs have been created to operate and service the turbines. German wind farms are earning DM1 billion (US $700 million) per year and are providing 1,400 direct jobs. Indirectly, at least 10,000 jobs in northern Germany are linked to wind power.
By the way, BP, Exxon-Mobil, TVA, and other old energy giants are not going to just vanish. No one is expecting to eliminate the need for fossil fuels in the near future. Nor would anyone expect them not to become big players in renewable energy.
Conservation Isn't Cheap, It's Frugal
Despite that fact that energy efficient technology developed in the last two decades created $200 billion in energy savings last year, the Bush Administration is determined to hamper or eliminate the programs that have led to this success. Here are some of the cuts proposed:
- Cut research into wind, solar and geothermal energy development between 15 and 30 percent. California relies on geothermal energy sources for six percent of its electricity needs. As already mentioned, wind turbine generates ample power to assist in meeting consumer demand for electricity.
- Cut programs intended to make buildings and factories use less energy and to generate more power from the wind and the sun. This simple does not make sense since facts prove that these programs work.
The Department of Energy invested $3 million in energy-efficient windows in the late 1970s. This has saved U.S. taxpayers more than $1 billion in lower energy bills and cumulative savings, and if continued will reach $17 billion by 2015. By the way, non-energy efficient residential and commercial windows leak as much heat every year as is produced from the annual output of the Alaskan pipeline--approximately 1.8 billion barrels every day. In dollar terms this equals $25 billion, annually.
Studies continue to support energy conservation as a viable way to extend the energy we have and keep costs down. For example, the Department of Energy found that a ten to twenty percent reduction in waste by American industry would generate a cumulative increase of $1.94 trillion in gross domestic product from 1996 to 2010.
Alternative energy and conservation has proven to be clean, efficient, and profitable despite the fact that both governmental and big business sectors have been firmly entrenched in promoting conventional energy sources.
For example, in their first 15 years of commercial use, nuclear and wind power plants produced roughly the same amount of energy. Yet during those same years conventional nuclear power plants received subsidies totaling $1,411 per U.S. household. Wind energy received $11 per U.S. household. In other words, wind energy only received 1/40th the funding as nuclear, but produced the same amount of energy.
The case for choosing a sound policy of renewable energy coupled with resource conservation versus continued reliance on fossil fuels is overwhelming. The simple truth is that the powerful benefactors?members and associates of the fossil fuel cartel?want it this way.
The Numbers: Bad for Big Oil, Rewarding for Renewables
Our dependence on foreign oil is at a record high of 50 percent. This accounts for more than 30 percent of the U.S. trade deficit, or $50 billion annually.
Current breakdown of energy resources used in the United States: Over 85 percent from fossil fuels; 8 percent nuclear; 4 percent hydro; less than 4 percent solar, wind, geothermal, and biomass combined.
Ninety-eight percent of man-made CO2 comes from burning fossil fuel. Fifty percent of green house gas comes from CO2.
On the other hand, renewables contribute zero percent CO2. SO2? Zero. NOx emissions? Zero.
A recent national poll by Bregilo Associates (firm used by The Wall Street Journal) gleaned the following American attitudes on energy and environmental issues: 75 percent are concerned about dependence on foreign oil; 70 percent believe global warming is a real threat; 70 percent are concerned about CO2 fossil fuels. (CONTINUED)
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