As Rupert Darwhal of RealClearEnergy writes, the new “carbon-neutrality-by-2050” mandates instituted almost “blindly” by governments (UK, EU) don’t consider the real costs.
- New Zealand is one of the only governments to take a sober look at what 2050 carbon neutrality would actually look like (would reduce GDP by 16.8%, would put the price of carbon up to $560 per metric ton).
- Reliance on wind (as pledged by the UK’s Johnson) makes a country more susceptible to blackouts.
- Market inefficiencies arise from governments buying up wind contracts.
“Hughes argues that wind companies view these bids as low-cost, no-penalty options on higher electricity prices. To make their bids viable requires wholesale electricity prices around 60% higher than the prices they actually bid. A land grab makes sense. Because the government auctions off only as much capacity as it reckons the country needs, it will be forced to let Big Wind off the hook and allow it to charge what it wants. For wind investors, it’s a one-way bet – paid for by electricity consumers and the economy as a whole.”
Read the full article here.
The views and opinions expressed are those of the author’s and do not necessarily reflect the official policy or position of C3.
