Biden Abandons American Miners & Embraces Dependence On Chinese Minerals

President Biden’s Department of the Interior revoked existing federal leases for Twin Metals Minnesota to mine copper, nickel, cobalt, and platinum-group elements in the Superior National Forest. These metals are needed for President Biden’s program for electric vehicles and renewable energy technologies. Electric vehicles, for instance, use twice as much copper as vehicles with internal combustion engines. Instead of producing these metals domestically, President Biden wants to be dependent on imports. Biden is choosing foreign sourced minerals, including mines that use child slave labor, over domestic mines and a union workforce that follows the best labor and environmental standards in the world in order to kowtow to environmentalists who want to ban mining in the United States. With less worldwide production of these metals and growing demand for them, their prices will skyrocket and be passed onto consumers who will eventually be forced into buying the products as auto manufacturers are planning to manufacture only electric vehicles in the future.

To reach a green energy future, the International Energy Agency (IEA) found that the world needed to massively increase its production of minerals—forecasting needed growth of graphite, cobalt, nickel, copper, graphite, and lithium by between 20 and 40 times by 2040. As the IEA explains, “In climate-driven scenarios, mineral demand for use in EVs and battery storage is a major force, growing at least thirty times to 2040. Lithium sees the fastest growth, with demand growing by over 40 times in the SDS [Sustainable Development Scenario] by 2040, followed by graphite, cobalt and nickel (around 20-25 times). The expansion of electricity networks means that copper demand for power lines more than doubles over the same period.”

Twin Metals Tax Revenues and Jobs

Mining projects bring new investments as well as millions of dollars in tax revenues and create thousands of jobs. Since 2010, Twin Metals Minnesota has invested more than $450 million into the Minnesota economy. The Twin Metals project, once operational, would directly employ 750 people long-term. Furthermore, approximately two spinoff jobs are created in other industries for each mining job. These spinoff jobs stabilize communities by providing new employment opportunities in manufacturing, retail, restaurants and green energy. The Twin Metals Minnesota project will generate more than 1,500 indirect and induced jobs in goods and services and other sectors.

Background

In December 2016, the Obama administration declined to renew the two leases for Twin Metals, after a legal opinion from the Department of Interior held that Twin Metals did not have an automatic right to renew those leases, which date back to 1966. But the following year, the Trump administration indicated that the government did not have the power to deny Twin Metals its leases. The Bureau of Land Management subsequently reinstated the leases and then renewed them for an additional ten years. With those leases, Twin Metals formally proposed its mining plans in 2019, which began a multi-year environmental review and permitting process by state and federal regulators. But Wednesday, a new legal opinion was released that overturns the Trump administration’s actions. Twin Metals is expected to challenge the opinion and defend its existing mineral rights.

Conclusion

The Twin Metals project would create hundreds of high-paying jobs, contribute billions of dollars to the regional economy and provide important metals that are needed to build wind turbines, electric vehicle batteries and other technologies critical to a green economy that President Biden insists on pushing on the American people despite its cost and dependence on imports. Rather than ensuring the United States has the supply chain needed for his green economy, Biden is pushing forward haphazardly to undermine jobs and increase prices for Americans while using taxpayer funds to pay for tax credits for his favorite projects, such as electric vehicles. He already destroyed jobs in the oil and gas industry and now he is destroying them in mining. President Biden has an opportunity to strengthen U.S. industry and instead he is working to further cement China’s dominant position in minerals processing.


*This article was adapted from content originally published by the Institute for Energy Research.

Biden Opens New Front in War on Domestic Energy with Revocation of Twin Metals Leases

The administration seeks further restrictions on the development of America’s energy security.

WASHINGTON DC (January 27, 2022) – The American Energy Alliance (AEA), the country’s premier pro-consumer, pro-taxpayer, and free-market energy organization, blasted the decision by the Biden Administration to revoke existing mineral leases for the Twin Metals mine in Minnesota’s Superior National Forest, that would supply copper, cobalt and nickel for America’s economy and provide thousands of good-paying union jobs for American workers.

AEA President Thomas Pyle issued the following statement:

“From his very first day in office, President Biden has worked to make energy harder to produce in America. While he has worked to cut off our oil and gas production here at home, he begs Vladimir Putin and OPEC for more oil. While he kills pipelines here at home, he happily lifted sanctions, supported by a bipartisan group of elected representatives, for a Russian pipeline in Europe.

Now he is broadening his reach, depriving Minnesotans of the opportunity for generations of jobs producing the copper, cobalt, and that nickel Biden says will play a part in his Green New Deal. By canceling these leases, President Biden is choosing Chinese and other foreign-sourced materials, including mines that use child slave labor, over unionized American workers. His actions show that he is either incapable of connecting the dots between energy security and national security or he simply doesn’t care.”


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Biden Abandons Israeli Pipeline In Favor Of Russian Gas Via Ukraine

President Biden is withdrawing U.S. support for the EastMed pipeline that would bring natural gas from Israel to the European continent. Europe is currently in an energy crisis with record prices for natural gas and electricity, potential rolling blackouts, low supplies of natural gas, millions of citizens in energy poverty and increasing coal consumption, which the continent has wanted to end. Increasing reliance on intermittent renewable sources that have not produced to their potential has put pressure on other sources the Europeans have discouraged. The result of Biden’s most recent decision is making Europe even more dependent on Russia for its natural gas. Currently, Western Europe gets over 40 percent of its natural gas from Russia via a pipeline that runs through Ukraine. Russia wants to activate its Nord Stream 2 pipeline that runs under the Baltic so that it can avoid the current route through Ukraine.

Biden gave Russia the go-ahead in July for the continued construction of Nord Stream 2, which Russia predicted could go on-line by the end of the year. Rather than helping an ally, Biden is helping Russia dominate Europe’s energy system and gain economic strength in doing so. The only explanation that Biden’s administration has given to withdrawing support is: “Washington’s interest is now switching to renewable energy sources.” While the White House is using its dogged support for the switch to renewable energy to justify its decision, the European Commission drafted legal text that pronounces natural gas and nuclear power as “transitional” green energy sources to be used to bridge countries away from coal toward technologies like wind and solar.

EastMed Gas Pipeline

The EastMed Gas pipeline is a 1,180-mile undersea pipeline project from Israel to southern Europe, set to be completed by 2025, which, when completed will ease Europe’s dependence on Russia and Turkey, which serves as a hub for oil and natural gas. The pipeline will reach depths of 3 kilometers, and have a capacity of 10 billion cubic meters per year. Construction of the pipeline is expected to cost approximately €6 billion ($6.86 billion). The pipeline is being developed by IGI Poseidon S.A., a 50-50 joint venture between the Greek gas utility DEPA and the Italian gas utility Edison. The EastMed Pipeline accord was signed in Athens by the leaders of Greece, Cyprus, and Israel on January 2, 2020.

Source: Euronews

Biden’s Political Decision

Biden is not only catering to Russia regarding the EastMed pipeline decision but also to Turkey, who is offended that it was left out of the EastMed pipeline accord. Turkey believes that it should be part of the pipeline project amid claims over natural gas in the east Mediterranean. Turkish president Erdogan declared that any future eastern Mediterranean “gas project must include Turkey. This business cannot be done without Turkey. Because if [gas] is to be transferred to Europe from here, it will only happen through Turkey.” According to an expert, the Biden administration is “attributing huge significance to Turkey,” and its future after Erdogan.

Biden’s Inconsistencies

MedEast is the second major pipeline that the Biden administration has put a damper on: the first being the Keystone XL pipeline that would bring oil from Canada and North Dakota to the Gulf States. Canadian oil is heavy oil needed for U.S. refineries that retooled decades ago when U.S. light oil production was declining. Keystone XL would also provide more oil to the United States from an ally rather than being dependent on OPEC and Russia for oil. For several months since the pandemic began, Russia was the number 2 supplier of oil to the United States, competing with Mexico for that distinction. When Biden blocked the Keystone XL pipeline by canceling its Presidential permit, he blocked a project that went over and above existing standards to address issues such as carbon emissions, safety standards, and cooperation with indigenous people impacted by the pipeline.

Biden’s Keystone XL and MedEast pronouncements both overturn decisions made by President Trump. When Joe Biden agreed to set aside U.S. objections to the controversial Russian undersea Nord Stream 2 pipeline, he reversed former President Trump’s policy of opposing the project due to security concerns. The 760-mile Baltic Sea pipeline allows direct Russian natural gas supply to Germany and other western European countries and allows Russia to dominate the European energy market, making Putin a power player in continental Europe, where Russia already supplies over 40 percent of its natural gas.

Conclusion

President Biden continues to overturn decisions made by President Trump regarding energy policy. In the most recent case, he has withdrawn U.S. support for the EastMed gas pipeline project, which would transport natural gas from Israel to Europe via the Mediterranean Sea when completed in 2025. The project would remove some of the continent’s dependency on Russia for natural gas supplies that Russia has used as a geopolitical tool at times in the past. Biden’s announced reasoning is that the focus in Washington is now on renewable energy, despite the European Commission seeing the necessity to allow natural gas to be deemed a “transitional green energy source”. Biden has shown huge inconsistency on his pipeline decisions, with one major exception—they all overturn decisions made by President Trump.

Tom Pyle to Congress: How it Started, and How it’s Going

Wednesday, January 19, AEA president Tom Pyle provided testimony before a joint forum held by the Congressional Western Caucus and Oversight & Reform Republicans titled: Holding the Biden Administration Accountable for Skyrocketing Prices & Failing Energy Policies.

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The Unregulated Podcast #67: Clean Up on Aisle Psaki

On this episode of The Unregulated Podcast Tom Pyle and Mike McKenna discuss the longest press conference in presidential history and how the world has reacted to Biden’s ramblings.

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Liberal Legislators Kick the Dog

Last week 41 of the biggest energy-haters in Congress sent a letter to Richard Glick, chairman of the Federal Energy Regulatory Commission, caterwauling about high energy prices. Like the gassy wheezer who fouls the living-room air and then kicks the dog to shift the blame, this cabal of pipeline blockers and permit-revokers tries to shift the blame from their own kill-oil and kill-gas policies. Instead, they point their fingers at the companies that actually produce the oil, and gas. Bad dog!

Like so many in DC, the signers of the letter show they have no grasp of basic principles taught in Econ 101. For instance, demand curves slope down. When supply is restricted by government action, the cost will go up. This cannot be fixed by anti-trust action or even price controls. It is fixed by un-restricting supply so that producers can drill, produce, and transport more energy. But, more oil and gas are an anathema to this group, even as they claim, oblivious to the irony, that some new-found greed on the part of oil and gas companies is the cause of the undersupply.

The letter does acknowledge two things that this group often ignores, higher energy prices are most painful for the disadvantaged and that we have been warned about it.

“In October, the U.S. Energy Information Administration (EIA) predicted that some households’ winter heating bills may rise by as much as 39 percent, compared to last year—a spike that will most affect those with the fewest resources. Nationally, low-income households face energy burdens that are three times higher on average than other households. This is also a racial justice issue, with Black and Hispanic households having a median energy burden that is 43 percent and 20 percent higher than non-Hispanic white households, respectively. The loss of utility service due to high energy burdens is one of the primary reasons for homelessness, especially for families with children.”

The American Energy Alliance and the Institute for Energy Research have long warned about high energy prices’ devasting impact on the poor. These impacts are not mitigated by magical promises of an imminent cornucopia of cheap renewables.

The promise of cheap renewables has gone on for decades and decades. The promised land is always around the corner, but we never seem to get there. On the other hand, policies to cut oil and gas production are served up pronto.

Though there was a respite during the Trump administration, the anti-oil and anti-gas policies go back to at least the Obama administration, with its revocation of drilling permits and reduction of access to the federal estate’s enormous energy assets along with adding costly regulations on energy production. 

President Biden couldn’t wait one day to restart the war against affordable energy. On Inauguration Day, he signed an order blocking a pipeline that would bring hundreds of thousands of barrels of oil to American refineries. That day he instantly destroyed thousands of jobs with the stroke of a pen. 

In further action, President Biden canceled oil leasing in Alaska and suspended oil leases on federal land, even after a court ruled the moratorium illegal. None of the signers of last week’s letter complained.

Though he killed the nearly completed pipeline that would bring oil from one of our most steadfast and loyal allies, Canada, of late the president has been begging OPEC to produce more oil. Less oil from our own reserves, less oil from our most trusted allies, but more dependence on oil from the most unstable part of the world is a disastrous policy.

Even more disastrous is the policy of getting rid of the reliable, affordable energy we already have while heaping unconscionable amounts of debt-finance subsidies on wind, solar, and other undependable, unaffordable energy sources, as the Build Back Better plan does. We don’t need to speculate on how this will turn out. We don’t need to see any studies. Europe has done the experiment for us and it’s a catastrophe. Energy prices are skyrocketing, manufacturers are closing down or leaving, and high utility bills threaten to leave people in the cold this winter.

This is the future we would get with the Build Back Better bill these letter-signers support, but they don’t have the honesty to own up to it. Blame somebody else is their pathetic response. 


David Kreutzer is a senior economist at the Institute for Energy Research. A native of Fairfax County, Virginia, Kreutzer earned his undergraduate and master’s degrees from Virginia Tech and received the first Ph.D. in economics from George Mason University. He taught economics for 23 years at James Madison University and for three years before that at Ohio University. He has published in peer-reviewed journals such as The Journal of Political Economy, Climate Change Economics, The National Tax Journal, Economic Inquiry, and Applied Economics. More of his works can be found here.

Biden Makes Life In Alaska (And The Rest Of The Country) Worse

Despite high gasoline prices, the Biden administration is reversing a Trump policy that opened up land in Arctic Alaska to new oil development. Biden’s Department of the Interior will scrap the Trump policy that authorized expanded leasing and development in the National Petroleum Reserve in Alaska, or NPR-A. The Trump administration approved a plan to allow oil leasing and development in 82 percent of the 23-million-acre reserve (about the size of Indiana), which replaced a 2013 Obama administration plan that allowed oil leasing and development on about half of the reserve. The Obama administration action was a reduction in the area available for lease from the Clinton administration. The Bureau of Land Management will be filing the official notice of the reversal in federal court in Alaska on Monday.

The Trump administration opened up more of the reserve 11.8 million to 18.6 million acres to expand the country’s energy potential and create jobs for Native Alaskans and the nation. According to the Anchorage Daily News, the Alaska Inupiat Eskimo people of the North Slope who live in and around NPR-A reacted forcefully in opposition to the Biden administration’s move. Leaders of the Arctic Slope Regional Corp. and the North Slope Borough (the Native Alaska organization and the local county-equivalent government) said in a joint statement that reverting to the 2013 land-use plan “diminishes Alaska Native self-determination by ignoring the needs, concerns and input of the local people who live, work and subsist in and around the NPR-A.”

ASRC President and CEO Rex Rock, Sr. said North Slope leaders have made multiple offers to work with Biden administration officials on issues such as the NPR-A to no avail. “(Interior) Secretary Haaland and President Biden have chosen, with this decision, to not only ignore the voices of the North Slope Iñupiat but to exclude us from the decision-making process on issues that impact our Iñupiat communities and our culture,” Rock said.

The latest announcement comes as part of litigation over the issue. In its new announcement, the BLM indicated that it does not think it needs to undertake a new environmental review. Instead, it plans to publish a new “record of decision” which formally establishes its policy.

NPR-A History

The National Petroleum Reserve in Alaska (NPR-A) is a 23-million-acre area on Alaska’s North Slope— the largest tract of federal land in the country and home to vast oil, gas and coal deposits. In 1923, President Harding set aside the area as an emergency oil supply for the U.S. Navy. In 1976, in accordance with the Naval Petroleum Reserves Production Act, administration of the reserve was transferred to the Department of the Interior’s Bureau of Land Management (BLM). The BLM is expected to hold annual oil and gas lease sales for the NPR-A, but the last NPR-A lease sale held by the BLM was in 2019

Alaska’s Oil Production and TAPS

According to the Energy Information Administration, Alaska produced 448,000 barrels of oil a day in 2020—a 43-year low. Oil production in the state peaked in 1988 at more than 2 million barrels per day, but the low flow levels from the reduced production are now putting the Trans Alaskan Pipeline System in jeopardy.

In July of 2021, Alaskan oil production was 380 thousand barrels per day, dangerously close to levels where the Trans-Alaskan Pipeline System (TAPS) can no longer operate because of lack of throughput. What TAPS needs is more oil. But, oil companies did not want to invest in Alaskan oil projects during the pandemic due to extremely low oil prices. Further, drilling approvals granted by the Trump administration were withdrawn by President Biden in response to the cries of anti-oil groups. And, under pressure from environmental groups, the six largest U.S. banks have pledged in recent years not to finance additional Arctic drilling, even though they willingly involve themselves in fossil fuel projects in China. 

Conclusion

Since President Biden took office, gasoline prices have risen about $1.00 a gallon as he immediately undertook anti-oil and gas policies following the inauguration, beginning with the cancellation of the Keystone XL pipeline. That was followed by bans on new oil and gas leases on federal land and waters, including the Arctic National Wildlife Reserve and Alaska’s Petroleum Reserve, and pressure on banks not to lend to the oil and gas industry in the United States.

Oil prices surged to a seven-year high, surpassing $85 per barrel, but are now settling around $80 a barrel. Gasoline prices are the highest level in 10 years, topping $3.30 per gallon, according to AAA’s national average on January 11. That gasoline price is a 42 percent increase over the price a year ago, when it was $2.318. Biden is continuing with his anti-oil and gas policies by reversing President Trump’s increase in acreage in the Naval Petroleum Reserve Alaska. According to Alaska Native people who live in the region, this was done without consultation and will hurt their future. That along with Biden’s other policies have negated the energy independence achieved under President Trump and made the United States more reliant on imports of oil from countries with less environmental regulations than the United States, and into the geopolitical fires of the Middle East.


*This article was adapted from content originally published by the Institute for Energy Research.

Democrats Consider Bribing “Flyover” America To Give Up Their Trucks

The House Committee on Agriculture hosted a hearing on Wednesday, January 12, on the needed infrastructure and possible impediments to electric vehicle adoption in rural America. At issue is what policies would incentivize rural electric vehicle penetration and at what cost, and, whether subsidizing electric vehicle use in rural America would make a significant difference in global carbon dioxide emissions. According to at least one witness, there are impediments to electric vehicles, based on their underlying engineering and physics, for rural markets.

Current Status

The total number of electric vehicles in use today is about 0.6 percent of all light duty vehicles on U.S. roads. However, the electric vehicle share of vehicles in rural America is at least 10 times lower than that. Rural residents drive about forty percent more miles per person than urban drivers and pickup trucks represent a larger share of the mileage driven in rural areas—about 40 percent of the share of new car purchases compared to 20 percent nationally. Nonetheless, auto manufacturers are working on all electric pickups.

Physical Impediments

The main factors regarding consumer acceptance of electric vehicles are lack of range, higher cost, and exorbitant charging times compared to internal combustion engine vehicles. A standard gas station pump can fill a 26-gallon Ford F150 fuel tank in about five minutes, while charging an electric vehicle with a standard Level 2 charger takes about 10 hours. A supercharger can drop that time to 40 minutes, which is 8 times longer than filling a gasoline tank. For an electric vehicle charging station to provide the same functional utility that consumers have today, it will likely mean 8 times more electric chargers than gasoline pumps, along with equivalent size increases of land dedicated to it. Because the capital cost of a supercharger is twice that of a gasoline pump, the infrastructure cost is 16 times higher. Further, the existing rural power distribution infrastructure would need to be upgraded because superchargers operate at about a ten-fold higher power level. The higher cost for a supercharger makes it unlikely that households will spend the costs for Level 3 superchargers.

Level 2 chargers are subject to the electric grid and any outages that occur, which, on average, are about 50 percent higher on rural grids than urban grids. For back-up due to grid failure, homeowners would need a Generac or Tesla Powerwall. A Powerwall with enough electric storage to cover half a tank of a F150 pickup would cost $30,000. That compares to a few hundred dollars for gasoline storage tanks to keep enough gasoline to back up a pickup at one’s home.

There is another issue regarding weight because an electric battery weighs one ton compared to 150 pounds for gasoline tank storage for a conventional truck with the same range. Further, a pickup used in rural areas is likely to haul and tow more weight and more often than a pickup used in urban areas, which would reduce range and increase frequency of recharging.

Critical Minerals Required

In order to manufacture car batteries, tens of gigatons of materials will need to be mined and even more gigatons will be needed to produce grid storage batteries. That does not count the materials needed to produce solar panels and wind turbines. Batteries requires at least a 1,000 percent increase in the tonnage of materials extracted from the earth to deliver the same mile driven by a gasoline vehicle.

Since electric vehicles make up less than 5 percent of new car purchases, the mining industry is yet to be stressed. The global rate of demand for these minerals, however, is greater than the current production plans from global suppliers. The increase in solar, wind, and battery manufacture is expected to increase demand for critical energy minerals from 400 percent to over 4,000 percent. Electric vehicles use about 300 to 400 percent more copper than a conventional car. To meet clean energy aspirations, copper will increase to half of all global copper supply from 20 percent today, and nickel will increase to 60 percent and cobalt to 70 percent from negligible shares today.

To meet the goal of electric vehicles making up two-thirds of vehicle sales by 2030, the increased demand for lithium, nickel and copper would require dozens of new mines—each the size of the world’s biggest. It is very unlikely that would happen since the average global time to open a new mine is 16 years. The imbalance between supply and demand will cause prices to increase. Since these materials make up 60 to 70 percent of the cost to produce a battery, their price increases will wipe out the gains in reducing electronics and labor costs that had been lowering battery costs.

Geopolitics and Dependency

Further, the critical energy minerals and their chemical processing takes place mostly overseas, particularly in China. Currently, the United States is dependent on imports for 100 percent of 17 critical minerals and more than half of another 28. The geopolitics of shifting the United States from fossil fuel self-sufficiency achieved under President Trump to energy-mineral dependency needs to be addressed. Further, lawmakers should be cognizant of the lack of environmental regulations in China for mining and processing these minerals. Continuing in this manner regarding critical mineral dependency on imports would be akin to importing 100 percent of gasoline from a potential adversary and our #1 competitor.

Carbon Dioxide Emissions

Mining the critical minerals and manufacturing electric vehicle batteries result in carbon dioxide emissions that are not immaterial. One study indicates that 2 to 6 barrels of oil equivalent are needed to fabricate a battery that can store the energy equivalent of one gallon of gasoline. Another study reviewing 50 Academic studies found manufacturing a single elecgtric vehicle battery ranged from a low of about 8 tons of carbon dioxide to a high of 20 tons for a battery that is half the size of that of a pickup truck. The high end of the range is about equivalent to the emissions from a lifetime of fuel burned from an efficient conventional vehicle. This analogy does not include the carbon dioxide emissions that result from recharging the electric vehicle.

To go from 10 million to 500 million electric vehicles on the road would reduce oil use by only 15 percent. Further, if rural homeowners in the United States replaced their second vehicle with an electric pickup, it would reduce U.S. oil consumption by barely 3 percent and world oil consumption by about 0.5 percent, and would have even less impact, if any, on carbon dioxide emissions.

Conclusion

Subsidizing rural America to buy electric vehicle pickups does not gain much, if anything, for the environment. Apparently, rural residents have the common sense to see that it does not meet their needs, since they are buying electric vehicles at 1/10 the rate of urban dwellers. Rather, it will just make the United States import-dependent on critical minerals, mostly from China, and push homeowners into huge expenses to maintain the reliability of their vehicles by having to purchase superchargers and Powerwalls. Further, the supply-demand imbalance that is likely to occur for critical minerals worldwide will increase costs and make energy transition goals impossible to meet. This is especially true since increased electrification at a time when intermittent renewable energy is being forced into the system, causing expensive challenges to the grid for which consumers will have to pay.


*This article was adapted from content originally published by the Institute for Energy Research.

The Unregulated Podcast #66: Numbers

On this episode of The Unregulated Podcast, Tom Pyle and Mike McKenna discuss the Biden administration’s continued descent into madness and the latest happenings, and not happenings, in Washington.

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Forced Electricfication Threatens Winter Heating For American Families

Early January saw a massive snowstorm in the Washington D.C. area that resulted in downed wires and electricity outages for many households and businesses. Over 50 miles of Interstate 95 was closed to traffic with thousands of people stranded for hours as traffic was stopped. Vehicles ran out of fuel and electricity. Many affected households and businesses rely entirely on electricity for their energy requirements, which is the way many blue states and the Biden administration are moving with their policies. With the outages lasting days, owners are suffering and determined to buy petroleum or propane generators to avoid a future occurrence. All this shows is that diversity of supply is needed for a secure, affordable and reliable energy system and “electrifying everything” under the guise of climate may increase problems. It was only decades ago when diversity of supply was encouraged and supported with coal, nuclear, oil, natural gas, hydroelectric and renewable energy all contributing to the U.S. energy system. Without a diverse supply system, Americans will be faced with more outages than those that occur because of a random snow storm.

States and countries opting for less diverse energy systems have been hit by high electricity prices and rolling blackouts or outages. They include countries in Europe (Germany, Spain and the U.K. for example), California, and Texas.

California

Established in 2002, California’s Renewable Portfolio Standard requires electricity providers to ensure that renewable energy constitutes a specified minimum portion of their electric load. Since then, the state Legislature has modified, increased, and accelerated the standard several times: investor-owned electric utilities must serve 33 percent of their electric load by 2020 and 60 percent of their electric load by 2030 with renewable energy. In 2020, California indicated that the state met the 33 percent requirement, with solar contributing 15.4 percent of it and wind contributing 7.2 percent. Geothermal represented 5.9 percent. But, according to the Energy Information Administration, California’s average electricity price in 2020 was 18 cents per kilowatt hour—70 percent higher than the national average.

California gets 48 percent of its electric generation from natural gas and 8.5 percent from 2 nuclear reactors, which it plans to retire in 2024 and 2025. It will then be dependent on renewable energy, natural gas and imports for its electricity requirements.

California plans to go all electric, which is the path President Biden is also trying to follow for the United States. Various California cities have banned using natural gas in new buildings and Governor Gavin Newsom ordered that sales of new gasoline-powered cars be banned by 2035. During the summer, the California Air Resources Board proposed requiring all new light-duty cars sold in the state by 2025 be electric, and that refineries be shut down by 2035, which would effectively ban gasoline-powered cars. Forcing people to use electric vehicles will only drive demand for electricity higher at a time when the entire system is already stressed.

The agency has also passed new rules that will phase out the sale of gasoline-powered lawn equipment and generators—the latter becoming more prevalent with rolling blackouts that occurred in August 2020. The new rules will require most newly manufactured small off-road engines such as those found in leaf blowers, lawn mowers and other equipment be zero emission starting in 2024. Portable generators, including those in recreational vehicles, would be required to meet more stringent standards in 2024 and meet zero-emission standards starting in 2028.

California state law gives the California Air Resources Board wide power to reduce statewide emissions 40 percent below 1990 levels by 2030, and the agency has used this mandate to implement a cap-and-trade program, a low-carbon fuel standard, electric-vehicle and renewable electricity mandates, and other regulations that raise costs for residents and businesses. Despite all the state’s draconian policies, the state is unlikely to meet its 40 percent mandate.

California has been shuttering its coal, nuclear, and natural gas plants and building solar and wind farms to meet its mandates. When the state finds it has insufficient generating capacity to meet demand, it imports electricity from neighboring states, which currently supply 30 percent of California’s electricity. But, in the summer of 2020, a heat wave resulted in California needing to use rolling blackouts because neighboring states had insufficient power to bail them out.

To solve the problem, California bought batteries to store excess wind and solar power to be used when wind and solar are not producing. Shortly after the battery addition was made, the battery modules overheated, scorching battery racks and melting wires, and placing the storage facility offline at a time when California could be threatened by rolling blackouts again. To ensure reliability, the state took the precaution of installing five “temporary” natural gas plants so it hopefully would not have to “steal” power. Earlier during the past summer, California’s electric grid operator “stole” electricity that Arizona utilities had purchased and that was in transit from Oregon through California.

Despite, California not producing much coal-fired power, the state does import power from states with coal-fired generators. The state is not serving as a good example, but the Biden Administration still hopes to follow in its footsteps.

Germany 

Germany plans on renewable energy meeting 80 percent of its power demand by 2030 by expanding wind and solar generation. The share of renewable energy in its electric sector was almost 41 percent in 2021, with coal generating just under 28 percent and natural gas generating around 15 percent. The German government decided to phase out nuclear power following Japan’s Fukushima reactor accident in 2011 when an earthquake and tsunami destroyed the coastal plant. Three of Germany’s 6 nuclear reactors, which combined generated 12 percent of the country’s power in 2021, were closed at the end of the year with the remaining 3 to be closed at the end of 2022. As it moves to reach its 80 percent renewable target, Germany will be shuttering more coal plants, which is currently slated for phase out by 2038.

German residential customers pay for the renewable subsidies that the country uses to encourage renewable power development. Before this winter when a natural gas shortage, severe winter weather and low winds caused electricity prices to skyrocket, German households were paying 3 times what U.S. residential customers pay for electricity. Now, their bills are even higher because of the lack of diverse supplies. Germany and much of the continent of Europe rely on natural gas from Russia to back-up their renewable energy. Russia is withholding some of those deliveries as it is pushing Nord Stream 2 to open, a pipeline that bypasses the Ukraine by going under the Baltic, and using more natural gas domestically during the current cold spell.

Germany now plans to become carbon-neutral by 2045 rather than 2050. The amended Climate Change Act also calls for cutting carbon dioxide emissions by at least 65 percent from 1990 levels by 2030. With nuclear power on its way out, coal’s exit set for 2038, and electricity demand expected to see a steep increase as vehicles go electric and hydrogen production increases, wind and solar power are expected to compensate. A hastier phase out of coal coupled with a slow uptake of renewables, which has recently been the case In Germany with wind power, and a higher increase in electricity demand would increase electric bills even more for German households and raise the probability of power outages.

Conclusion

A snow storm and power outages in the D.C. area raise the issue of diversity of energy supply both for the electric system and for households as well. States with Democratic Party-controlled legislatures and executives and the Biden administration are pushing for all electric homes and businesses and for electricity to be produced mainly from intermittent renewable energy, which Europe has found this winter to be unreliable as wind generation has been severely reduced due to low winds. A path of all electric homes and vehicles and electricity produced mainly from intermittent wind and solar is a path likely to be steeped with blackouts, expensive electricity and general disaster for businesses that need affordable and reliable energy.


*This article was adapted from content originally published by the Institute for Energy Research.