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.

 

References

(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 https://www.buckeyeinstitute.org/library/doclib/The-Impact-of-Renewables-Portfolio-Standards-on-the-Ohio-Economy.pdf

(2) Alan R. Rosenfield, LWVO Testimony on HB114 -RENEWABLE ENERGY STANDARDS, House Public Utilities Committee, March 21, 2017, https://drive.google.com/file/d/15GaqwwQqr692-UStmRxnYFF3hyt8Cbd-/view\

(3) Energy Information Administration, Electrc Power Monthly, Feb. 2018, https://www.eia.gov/electricity/monthly/archive/february2018.pdf

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Setback Comparisons

Letter that the Dispatch did not publish:

In a letter to the Dispatch (10 Aug., 2017) Jeremy Kitson complained about possible legislation to reduce the distance separating wind farms from residences. Mr. Kitson also noted that the State has complete say in specifying wind-farm locations. Although it is not clear what distance (known as setback) will be in the proposed legislation, 1300 feet appears to be a likely guess, based on news reports.

Setbacks for oil and gas wells are much smaller. Ohio law (Section 1509.021) includes setbacks of 100 feet from rural homes and 50 feet from water supplies for oil and gas wells. As it is for wind, locations of oil and gas wells are determined by the State; local governments have no say.

Neighbors of oil and gas wells have bigger problems that neighbors of wind farms.

 

Alternative Motor Vehicles

Transportation is the second largest source of greenhouse gasses (1).

 

Technology Cars Other

Vehicles, (a)

Total
Ethanol/Flex Fuel 3.67 16.12 19.79
Electric/Gasoline Hybrid 3.43 0.44 3.87
Other Technologies (b) 0.81 0.32 1.13
Total Alternatives 7.90 16.88 24.79
Total Vehicles 120.5 121.4 241.9
% Alternative 7% 14% 10%

Notes in Table

(a) Vans, SUV, etc.

(b) Natural gas, all-electric, etc.

 

 

References:

 

(1) EPA “Sources of Greenhouse Gas Emissions” http://www.epa.gov/ghgemissions/sources-greenhouse-gas-emissions, accessed 27 June 2017

Renewables Catching Up With Nuclear

Nuclear activists point out that reactors do not generate greenhouse gasses and that decommissioning them leads to electricity being generated by fossil fuels (some nuclear opponents claim that reactor technology is polluting; I looked into this several years ago and was not impressed by the quality of the research).

Renewable-energy supporters claim that sufficient wind energy is being installed each year to offset the loss of reactors (averaging about one decommissioning per year [1]).  Surprisingly output from reactors has remained steady. Improved efficiency must be the reason, since there have not been any new reactors for many years [2].

Generation by renewables have strongly increased from about half of nuclear in 2008 to about two thirds today. Since hydropower has remained steady, the increase is due to wind.

So far so good. Since nuclear production has been steady, wind has helped to take up the slack due to coal plant retirement.

References

[1] EIA, Today in Energy, June 13, 2017

[2] Data in the figure from EIA, Electricity Data Browse,  accessed July 1, 2017

Why Less Coal

I have been assuming that gains in electricity generation by natural gas were the reason for loss in generation by coal. This is not quite true. In 2016 coal generation was down by about 750 million kilowatt-hours (kWh) from its 2006-2008 average, a 38 percent drop. About two-thirds of the drop was due to natural gas and about one-third to renewables.

Source EIA Electric Data Browser, accessed 21 June 2017

Renewable Energy Does Not Harm Stock Performance

There are still office holders who cling to the notion of expensive renewable energy, buttressed by questionable web sites.

There is a line of argument that I have not seen used: companies, such as Google and Amazon, have made major commitments to renewable energy. These are publically-traded firms. If renewable energy was so expensive, Wall Street would be shouting loudly and hammering their stock down. This has not happened.