Wednesday, September 18, 2013

Renewables Cost Less than Fossil Fuels. Period.

A recent study confirms what we have been saying for quite some time:  when the external costs of carbon pollution are considered, renewable energy is cheaper than burning fossil fuels. 

When we talk about external costs, carbon pollution's negative impact on human health and nature are two very big ones that come to mind.    

The findings show the nation can cut carbon pollution from power plants in a cost-effective way, by replacing coal-fired generation with cleaner options like wind, solar, and natural gas, according to the Natural Resources Defense Council, who authored the study.  

"In fact -- using the official U.S. government estimates of health and environmental costs from burning fossil fuels -- the study shows it's cheaper to replace a typical existing coal-fired power plant with a wind turbine than to keep the old plant running. And new electricity generation from wind could be more economically efficient than natural gas," according to a Science Daily story about the new study. 

A retired oil executive of all people lends a more dire assessment:

"Socialism collapsed because it did not allow prices to tell the economic truth. Capitalism may collapse because it does not allow prices to tell the ecological truth," said Oystein Dahle, retired VP of Esso Norway.

At first blush it seems doubtful that something so touchy feely as ecology can impact something as powerful and manly as capitalism.  But it's not about those adjectives. 

It's about failing to include the cost of poor human health and fouling nature in the price of fossil fuels to run our vehicles and to produce our electricity.

It's the value of nature lost.  That's trillions of dollars in countless benefits including bountiful clean air, water, land, and oceans.  And losing money -- any money but especially that much money -- is the enemy of the for-profit system we call capitalism.

So maybe Oystein is right.  But not yet.  We can avoid his dire prediction about the collapse of capitalism by including the true costs of fossil fuel pollution in the prices we pay at the pump and meter.  If and when that happens, capitalism will make sure that the market for clean energy thrives.

Why support clean energy businesses?  Do it for capitalism!  It makes good sense, wallet sense, anyway. 

Read the whole True Cost of Fossil Fuels piece by Peter Lynch in Renewable Energy World.  It's familiar stuff, especially in this blog, but he spells it out in a fresh way.

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