“It’s an absolutely sh*t situation.” That is the assessment of Norway’s energy minister, Terje Aasland, about his country’s electricity costs rising to record levels due to its exports of power to the United Kingdom, Germany, Denmark and other European countries.
It is an outcome that many warned the Norwegian government would come about as the decisions were made to build the interconnects to export power into the European Union and the UK. Those critics were of course ignored as those in charge of Norway’s fortunes at the time felt compelled to genuflect to the demands of the EU and other globalist organizations.
Norway derives the vast majority of its electricity from hydropower, which currently provides 90% of the country’s power generation. Most of the remainder comes from wind power, and the nation enjoys a large excess of generating capacity on most days. Thus, all other factors being equal, it made some financial sense to establish those interconnects to sell the surplus into other countries.
But it only made sense when those other countries were taking care to ensure the continuing health and adequacy of their own electric grids. That certainly has not been the case in either the UK or Germany, whose governments have in recent years chosen to discard a former wealth of reliable baseload capacity provided by coal and nuclear plants in favor of relying too heavily on intermittent, weather-dependent wind and solar.
Now, when the wind stops blowing and the sun isn’t shining, those customers of Norwegian power exports drain the host country’s surplus, causing the extremely high energy costs to flow back upstream, hitting Norwegians with abnormally high utility bills. It all came to a head this week when low wind speeds, combined with abnormally cold temperatures on the European mainland, caused power rates in Norway to spike to as high as €1.12 ($1.18) per kilowatt hour (kwh).
By comparison, the average electricity rate per kwh in New York is around 22 cents, while Texans typically pay around 15 cents per kwh. What that price spike meant for Norwegians on December 12 is that taking a 5-minute warm shower would have cost them $5. Doing the same in Texas would have cost around 16 cents.
Naturally, public outrage in Norway over these needlessly high electricity rates is now causing policymakers there to run for political cover. The Financial Times reports that both the ruling leftwing Labour Party and conservative Progress Party are now making plans to campaign next year on platforms to limit or end the export of electricity via these international interconnections.
That is a prospect that no doubt sparks fear in the hearts of the central planners in both Germany and the UK, where electricity imports from Norway play a central role in their own emissions reduction plans. Those plans involve the willful destruction of reliable baseload power stations and forcing power costs to dramatically increase, which in turn results in heavy industries like steelmaking and other manufacturing to leave the country. In that way, these governments are essentially exporting their emissions to China, whose own government is only too happy to serve as home to these heavy industries and power them with the hundreds of coal-fired power plants they build each year.
California Gov. Gavin Newsom and his fellow Democrats have pursued essentially the same strategies in California in this century, with predictable results: Californians pay among the highest power rates in the United States as their power grid has become overloaded with intermittent generation and increasingly reliant on imports from other states. Rather than exporting its emissions to China, California exports them to Nevada and Utah and other U.S. states.
The Biden administration has attempted to take the entire country down this same economically ruinous path for the past four years. Fortunately, voters awakened just in time this year to head off the most damaging impacts now being seen in Germany and the UK.
For Norway, is this an example of the law of unintended consequences setting in? Sure, to some extent. But it is also a clear example of entirely foreseeable consequences stemming from poor policymaking by multiple national governments flowing across borders. This “sh*t situation” was all avoidable, and frankly should have been.
David Blackmon is a contributor to The Daily Caller News Foundation, an energy writer, and consultant based in Texas. He spent 40 years in the oil and gas business, where he specialized in public policy and communications.
During his debate with former President Donald Trump, President Joe Biden claimed: “The only existential threat to humanity is climate change.” What if I told you that it is not climate change but climate policies that are the real existential threat to billions across our planet?
The allure of a green utopia masks the harsh realities of providing affordable and reliable electricity. Americans could soon wake up to a dystopian future if the proposed Net Zero and Build Back Better initiatives — both aimed at an illogical proliferation of unreliable renewables and a clamp down on dependable fossil fuels — are implemented.
Nowhere is this better reflected than in remote regions of India where solar panels — believed to provide clean and green energy — ultimately resulted in being used to construct cattle sheds.
The transformation of Dharnai in the state of Bihar into a “solar village” was marked by great enthusiasm and high expectations. Villagers were told the solar micro-grid would provide reliable electricity for agriculture, social activities and daily living. The promise engendered a naïve trust in a technology that has failed repeatedly around the world.
The news of this Greenpeace initiative quickly spread as international news media showcased it as a success story for “renewable” energy in a third world country. CNN International’s “Connect the World” said Dharnai’s micro-grid provided a continuous supply of electricity. For an unaware viewer sitting in, say, rural Kentucky, solar energy would have appeared to be making great strides as a dependable energy source.
But the Dharnai system would end up on the long list of grand solar failures.
“As soon as we got solar power connections, there were also warnings to not use high power electrical appliances like television, refrigerator, motor and others,” saida villager. “These conditions are not there if you use thermal power. Then what is the use of such a power? The solar energy tariff was also higher compared to thermal power.”
A village shopkeeper said: “But after three years, the batteries were exhausted and it was never repaired. … No one uses solar power anymore here.” Hopefully, the solar panels will last longer as shelter for cows.
Eventually, the village was connected to the main grid, which provided fully reliable coal-powered electricity at a third of the price of the solar power.
Dharnai is not an isolated case. Several other large-scale solar projects in rural India have had a similar fate. Writing for the publication Mongabay, Mainsh Kumar said: “Once (grid) electricity reaches unelectrified villages, the infrastructure and funds used in installation of such off-grid plants could prove futile.”
While green nonprofits and liberal mainstream media have the embarrassment of a ballyhooed solar project being converted to cattle shed, conventional energy sources like coal continue to power India’s over 1.3 billion people and the industries their economies depend on.
India saw a record jump in electricity demand this year, partly due to increased use of air conditioning units and other electrical appliances as more of the population achieved the financial wherewithal to afford them. During power shortages, coal often has come to the rescue. India allows its coal plants to increase coal stockpiles and import additional fuel without restrictions.
India will add more than 15 gigawatts in the year ending March 2025 (the most in nine years) and aims to add a total of 90 gigawatts of coal-fired capacity by 2032.
Energy reality is inescapable in a growing economy like India’s, and only sources such as coal, oil and natural gas can meet the demand. Fossil fuels can be counted on to supply the energy necessary for modern life, and “green” sources cannot.
India’s stance is to put economic growth ahead of any climate-based agenda to reduce the use of fossil fuels. This was reaffirmed when the country refused to set an earlier target for its net zero commitment, delaying it until 2070.
The story of Dharnai serves as a cautionary tale for the implementation of renewable energy projects in rural India, where pragmatism is the official choice over pie in the sky.
Vijay Jayaraj is a contributor to The Daily Caller News Foundation and Research Associate at the CO2 Coalition, Arlington, Virginia. He holds a master’s degree in environmental sciences from the University of East Anglia, UK.
A coalition of grassroots advocacy groups is asking the Arizona Corporation Commission (ACC) to reject Environmental, Social, and Governance (ESG) efforts by energy companies, citing the impact to consumer well-being.
In a letter sent last week, representatives of Heritage Action for America, EZAZ, and Heartland Impact, led by the Arizona Free Enterprise Club (AFEC), expressed concern for the impact on utility rates and energy reliability that ESG implementation poses under plans submitted by APS, TEP, and UNS. The grassroots claimed that the three companies have deprioritized cost and efficiency in pursuit of voluntary climate goals.
“The Commission has a constitutional obligation to ensure just and reasonable rates and a statutory duty to ensure adequate provision of service,” stated the organizations. “That means ensuring reliable, affordable, and plentiful energy in the state, which should be the mission of this Commission. But these ideological environmental commitments do the opposite, and for that reason, they should be rejected.”
The grassroots leaders also expressed concern with the relationship between ESG and a greater political agenda to achieve “net zero” carbon emissions by 2050. In order to achieve net zero, companies would have to drastically reduce, if not eliminate totally, usage of coal, gas, and oil in exchange for renewable energies such as solar and wind.
In their letter, the organizations pointed out the intermittency — and therefore unreliability — of renewable energies. They referenced the power failures and high rates experienced by states and countries further along in their net zero journey, citing specifically California, Texas, and Germany.
The grassroots leaders maintained that ACC has the authority to prevent energy companies from quitting traditional energies and using ratepayer funds to subsidize renewables.
Utility companies previously rejected an increased reliance on renewable energies as recently as 2018, the letter noted, over concerns that such a move would greatly increase costs for ratepayers. They also cited 2021 ACC cost analysis, which found in part that a total transition to renewables could incur a $6 billion cost to ratepayers, averaging hundreds of dollars more a month, by 2050.
Last year, AFEC issued an analysis comparing the energy mandates of the 10 states with the highest electricity rates and 10 states with the lowest electricity rates. Per that report, nine of the 10 states with the highest rates had some form of mandates requiring renewable energy usage, while seven of the 10 states with the lowest rates had no mandates at all.
The report estimated that states with renewable energy mandates paid, on average, close to double what their peers in mandate-free states paid.
In a press release, AFEC President Scot Mussi blamed leftist politicians for the ESG push.
“Liberal activists and politicians in Arizona are seeking to harm our energy future, freedoms, and choices by forcing their radical and failed ESG policies on consumers,” said Mussi.
As AZ Free News reported last November, the executives overseeing those three companies have financial incentives to meet ESG criteria.
Corinne Murdock is a reporter for AZ Free News. Follow her latest on Twitter, or email tips to corinne@azfreenews.com.
Radical Leftists and solar panel companies are freaking out over the upcoming Arizona Corporation Commission meeting on Wednesday, October 11 at 10:00am! But, based on the available public comments, they are the only ones who have contacted the Corporation Commission to express their desired actions regarding what’s on the agenda.
Currently, Arizona regulations force utility companies in the state to buy the extra solar power each solar customer puts into the grid. The Arizona Corporation Commission sets the rates that utility companies pay those customers.
On Wednesday, the Corporation Commission could vote to change the amount utility companies pay to match the break-even cost of the companies. This would reduce the vast majority of Arizonans’ energy bills.
In 2007, the Corporation Commission implemented a policy that required utility companies to pay retail price of solar power to their customers who put solar power back into the grid.
Those customers are still getting that rate today, even though the price of solar power has decreased tremendously over time. The customers are locked into that amazing deal for 20 years from the date of installation.
The 2007 policy ended in 2016 when the Corporation Commission decided utility companies should pay wholesale pricing to customers. However, there was a “great negotiation” between those who wanted the policy to remain in place—the Radical Left & solar power companies—and the Corporation Commission. The new policy implemented allowed for a maximum of only a 10% reduction in the price utility companies pay these customers every year. Since 2016, customers are locked into the rate they are paid for 10 years from the date of installation. Oh, and yes, those customers who installed solar panels between 2007-2016 are still locked in to get paid retail pricing for 20 years from the date of installation.
Because the maximum reduction of the rate utility companies pay to solar power customers who give to the grid is only 10% per year, there is still a huge discrepancy between the true wholesale solar power price and the rate utility companies are forced to pay these customers.
APS calculates their “Avoided Cost” at almost $0.05. This means APS would nearly break even on paying five cents per kWh to solar panel customers giving power to the grid. However, APS is forced to pay nearly $0.09 per kWh. For ten years, APS has to pay this rate to every solar panel customer who gives power to the grid, even though solar power is more than likely going to continue to fall.
The Arizona Corporation Commission sets the maximum profit rate of utility companies. APS’ is set at 8.7%. Being forced to pay customers more for their energy than the break-even cost causes utility companies to charge customers who do not have solar and are not giving to the grid a higher price for energy to meet profits.
If APS is allowed to truly match wholesale pricing for all solar panel customers giving to the grid and pay each one of them just under five cents per kWh, APS would be forced to cut the cost of energy for all of their customers, use the extra funds left over to reinvest, and/or expand its energy providing capabilities.
That’s why, if you really believe in clean energy or just want cheaper utility bills, it’s important to make your voice heard by speaking up, giving public comments, or submitting written public comments.
Right now, the only folks who have been doing so are those who own solar panels and don’t want their pay to decrease or solar panel companies who may face tougher economic hardship. But all customers deserve a say in our state’s energy prices both now—and in the future.
Jeff Caldwell currently helps with operations at EZAZ.org. He is also a Precinct Captain, State Committeeman, and Precinct Committeeman in Legislative District 2. Jeff is a huge baseball fan who enjoys camping and exploring new, tasty restaurants! You can follow him on X here.
Is the much-hyped “energy transition” starting to crumble at its foundations now? In recent weeks we have seen the following:
Ford Motor Company warns investors its electric vehicle division will lose $4.5 billion in 2023;
Reports that China has commissioned another 50 GW of new coal-fired electricity generation capacity;
The British government led by Prime Minister Rishi Sunak beginning to back away from absurdly aggressive transition timelines amid public outcry over rising energy bills and other deprivations;
The German government continuing to reactivate mothballed coal plants and facilitating new mining for coal;
The Scottish government forced to admit it has facilitated the felling of 16 million trees in this century to make way for new wind farms;
The Japanese government moving to reinvigorate its own coal-fired power sector;
Global demand for crude oil rapidly growing and outpacing supply growth, surprising all the supposed experts;
The U.S. Department of Energy forced to admit its initial estimate of consumer “savings” from converting from gas stoves to more expensive electric models was grossly overstated.
This list could go on and on, but the macro view is clear: Everywhere one looks, the aggressive timelines and heavily subsidized plans for a rapid transition are falling apart. Nowhere is the dynamic becoming clearer than in the wind industry.
In an Aug. 7 report titled “Wind Industry in Crisis as Problems Mount,” the Wall Street Journal catalogues $30 billion in planned investments in new wind projects in the U.S. and elsewhere that have now been delayed due to an expanding variety of factors. “After months of warnings about rising prices and logistical hiccups, developers and would-be buyers of wind power are scrapping contracts, putting off projects and postponing investment decisions,” the story says, emphasizing that the problems are becoming especially severe in the offshore wind business that has been so heavily promoted by the Biden administration.
I wrote a story in July detailing the fact that some of the so-called “Big Oil” companies have recently made big inroads into the offshore wind business, winning bids in the U.S. and Germany for licenses to develop large projects. But the Journal’s story quotes Anders Opedal, CEO of Norwegian oil giant Equinor, saying, “At the moment, we are seeing the industry’s first crisis.”
Along with British oil major BP, Equinor has plans in place to develop three wind farms off the Atlantic coast of New York, but recently warned state officials they would need to renegotiate power prices or the projects would not be able to obtain the needed financing. This demand by the two oil companies echoed a call by traditional wind developer Orsted in June for more subsidies from the U.K. government if its planned projects in the North Sea are to remain viable.
Make no mistake about it: Developing these offshore wind projects doesn’t come cheap. Orsted pulled out of a competitive bidding auction in Germany last month for government licenses to develop 7 GW of new offshore wind capacity when BP and French oil major TotalEnergies ran the final bids up to almost $14 billion.
“Orsted very deliberately chose not to pay record high concession prices for new offshore projects in Germany,” Orsted CEO Mads Nipper said in a post on LinkedIn. Orsted objected to the process that awarded the licenses based on the willingness of developers to pay the government for the right to develop — the same process used in oil and gas leasing all over the world — rather than the government offering more and more subsidies to incentivize development.
Therein lies the central conundrum for this subsidized transition: At some point, wind, like solar, electric vehicles and all the other rent-seeking solutions being promoted in this energy transition will have to become viable without an expectation of permanently rising subsidies, since governments already seeing their credit ratings downgraded due to overwhelming debt won’t be able to just keep printing money forever.
But, at the present moment, the business models in play do not appear to be headed for that outcome. And that’s why this energy transition seems to be falling off the rails.
David Blackmon is a contributor to The Daily Caller News Foundation, an energy writer, and consultant based in Texas. He spent 40 years in the oil and gas business, where he specialized in public policy and communications.
