Renewable Energy Does Not Raise Electric Rates

It is an article of faith of conservative economists that renewable energy raises electric rates and causes economic distress. To make their case, they produce detailed analyses, such as Ref (1), based on cost assumptions.


The acid test of the effects of renewable energy is its actual effect on actual electric rates. I have previously shown that electric rates, as well as unemployment rates, are independent of the amount of renewable energy produced in a state (2). Those were 2016 data. The 2017 data are now in (3) and are consistent with earlier data. With the exceptionof traditionally expensive states (Alaska, Hawaii, and New England) the data lie in a narrow band, confirming that renewable energy does not raise electric rates.



(1) Orphe Divounguy, et al., Economic Research Center Analysis: The Impact of Renewables Portfolio Standards on the Ohio Economy, The Buckeye Institute, March 3, 2017

(2) Alan R. Rosenfield, LWVO Testimony on HB114 -RENEWABLE ENERGY STANDARDS, House Public Utilities Committee, March 21, 2017,\

(3) Energy Information Administration, Electrc Power Monthly, Feb. 2018,


Electric Vehicles Fight Climate Change

Electric vehicles can be a potent factor in combating climate change. Even though producing electricity for these vehicles creates CO2, electric engines are so much more efficient than internal combustion engines that there is an overall net decrease in greenhouse gasses compared to gas-driven vehicles. Proof is in my calculations posted at

Most of the discussion of greenhouse-gas reduction has focused on electricity generation, which is the largest source (1). However generation by transportation is not far behind (34% vs. 39%). The advent of electric vehicles (EV) provides a major opportunity to reduce carbon dioxide (CO2) emissions using current technology. As shown in the Appendix to this discussion, CO2 emissions would be reduced by about 1.51 billion metric tons of CO2 annually (about 28 percent) if all gasoline-powered vehicles were replaced with electric vehicles. This savings is far in excess of the approximately 400 metric ton decrease needed to meet the goals of the Paris Accords (2).

Such a drastic change would take many years, even if there were no barriers. For example, it is well known that ranges of gas cars are greater and refueling them is more convenient. But these handicaps should diminish with time. The critical question is overall cost.

On average, electric vehicles cost about $2,500 more than similar gas cars (3). But electricity costs are less than gas costs and the initial price difference is made up as miles pile up. However, the $7500 federal tax credit keeps electric vehicle prices artificially low. Only the two Tesla models are cheaper than comparable gas cars without the tax rebate (3). It is difficult to believe that the tax credit will survive if electric vehicles start to make a significant dent in gasoline usage.

Used electric vehicles are inexpensive (4), which means that they depreciate faster than gas cars do. The owner is selling a car with a used battery and the $7,500 tax credit no longer applies when the battery is eventually replaced.

In summary, both high initial cost and rapid depreciation are likely to be serious barriers to growth of electric vehicles.


(1)LLNL, Carbon Flow Charts, The most recent is 2014.

(2) Michael Liebreich, Bloomberg New Energy Finance Summit, April 25, 2017,

(3) Zach McDonald, How Long Does It Take To Recoup the Extra Cost Of An Electric Car?, EV Industry; Green Fleet, June 16, 2016,

(4) Jim Gorzelany, Why You Should Consider Buying A Used Electric Car, Forbes, Septembe 18, 2017,



Car Mileage


U.S. fleet average is about 25 mi/gal (A-1), with the average energy provided by one gallon of E10 being about 120,000 BTU (A-2), which equals 126 MJ (A-3). Putting everything together, gasoline-powered cars require about 5 MJ of energy per mile.


Electric vehicles are rated in kWh/100 mi. The average is about 30 kWh/100 mi (A-3). Since one kWh is 3.6 MJ, electric cars require abut one MJ of energy per mile.

Summary Electric cars require 1/5 of the energy that gasoline cars do.

Overall Changes

U.S. Energy consumption is reported in a very large energy unit – quads or quadrillion BTU (A-5). Total U. S. energy consumption is 97.3 quads. Transport uses 27.9 quads, which are from fossil fuels. Since electric cars are 1/5 as energy intensive as gas cars, a complete switch to electricity would lower this amount to 1/5 the current value, or 5.6 quads, giving a decrease of 22.3 quads or 23 percent in total energy consumption. Electricity generation, now 37.5 quads, would have to rise by 5.6 quads, or about 15 percent.

Total carbon dioxide (CO2) emissions are 5.41 billion metric tons (A6). Switching to electric cars eliminates the 1.83 billion metric tons CO2 produced by gasoline. But the 15% added release in electricity is estimated at 0.3 billion metric tons (A-7), for a net decrease of 1.5 billion metric tons or 28 percent of CO2.


(A-1) Reuters, U.S. vehicle fuel economy rises to record 24.7 mpg: EPA, January 11, 2018,

(A-2) Data from:Alternative Fuels Data Center – Fuel Properties Comparison,