Secretary Chu: We Can Win Clean Energy Battle - Seven trillion dollars are at stake in the global battle to win market share in renewable energy and the United States can win that battle, U.S. Secretary of Energy Steven Chu said during stops in Colorado.
Let's see, Secretary Chu is touring a GE facility. Would that be the same GE that paid no corporate income tax?
Secretary Chu insists America must invest federal money into the renewable energy market for it to work. Only thing is, federal money is taken from the taxpayers effectively by coercion so it can be invested in plants such as GE's so they can avoid income taxes, Solyndra and Beacon (both of which went bankrupt), and Evergreen which moved its operations to China where they can dump the toxic chemicals (from making solar PV cells) out on the ground. When money is taken from taxpayers, they have less money to buy the things they need and want which decreases demand which is bad for the economy. When money is taken from taxpayer businesses, they have less money to grow their business and hire additional employees. The people left without jobs have to fall back on government assistance to eat and house themselves meaning more money has to come from taxpayers who are still employed or be borrowed from other countries thereby digging us deeper into debt.
Only in America would people with a "progressive" mindset compare tax deductions the oil industry gets to production-tax-credits and cash-in-lieu grants by labeling them both subsidies. See politicians call a reduction in the growth of spending a spending cut whereas the poor sap taxpayers have to do cutout spending onsomething they actually want or need to achieve a spending cut.
Let's address Secretary Chu's statement that wind energy is now cost competitive with fossil fuels at 5.5 cents per KWh ($55/MWh). No, it is not for a couple of reasons. Natural gas is presently around $4 per million BTU. The market heat rate in ERCOT is about 8,000BTU/KWh (gas based equivalent) making the fuel cost about $32/MWh. Capital costs run about $0.6/MWh based on a CCGT plant having a 20 year life. O&M adds maybe another $0.5/MWh. That yields and around the clock power price of about $33.10/MWh. When wind is most available, between about 11PM and 6AM, ERCOT power prices are routinely in the $25 to $26/MWh range. So, no--wind is not economically competitive with fossil power.
If America wants to be competitive in the global renewable energy market, then we need to restructure our corporate tax system. To do that, we need to cut spending on stuff that does not compete economically. We also need to restructure our regulatory systems to eliminate onerous requirements that do not have any benefit or perhaps may even be harmful to competitiveness.
Secretary Chu just does not have a clue.