by Jonathan Lesser
Despite Germany’s last-ditch attempt at realism, the European Union recently approved a 2035 ban on gas-powered cars, moving ahead with its “net zero” emissions agenda. In the U.S., the cost of achieving net-zero carbon emissions would be staggering – $50 trillion if the goal is reached by 2050 – as would the demand for raw materials, which in most cases would exceed current annual worldwide production.
The impact on world climate, however, would be negligible. Emissions in developing countries will continue to increase as those countries’ focus is economic growth for their citizens, not permanent economic misery to “save” the climate. Although a recent Washington Post article suggests that wealth be viewed in terms of “joy, beauty, friendship, community, [and] closeness to flourishing nature,” impoverished individuals who cook with animal dung – such as 80% of the population in the African nation of Burkina-Fasso – aren’t likely to find much joy and beauty in economic misery. Granted, having to cook with animal dung ensures “closeness to nature,” although probably not the one the article’s author envisions.
Rather than approaching energy policy clearly, the U.S. (and most of the western world) is pursuing so-called “net zero” energy policies aiming to fully electrify western economies, while relying almost entirely on wind and solar power. The additional required electricity – after all, the wind doesn’t always blow, and the sun sets nightly – would supposedly be supplied by energy storage batteries or hydrogen-powered generators. Two factors drive these policies.
First, there is climate hysteria, which promotes claims that have either proven to be false (the “end of snow” in Great Britain, the disappearance of glaciers in Glacier National Park) or posit extreme scenarios (complete agricultural collapse, massive sea level increases, more frequent hurricanes). The actual evidence is to the contrary, including increased agricultural yields, minimal sea level rise, and no increases in observed hurricane frequency.
Second, these policies are driven by old-fashioned greed. Green energy subsidies, which were already large, have been hugely expanded under the Biden Administration’s Inflation Reduction Act (IRA). The IRA is a virtual smorgasbord of green energy subsidies for offshore wind, solar power, electric vehicles, and charging infrastructure. The green energy pork, which relies on climate alarmism for its justification, is increasing electricity costs and reducing standards of living, such as in Europe, where deindustrialization is taking place because of unaffordable energy costs. Even progressive California admits its zero-emissions goals primarily will benefit the wealthy at the expense of the poor.
Although the author of the Washington Post article may think differently, modern society requires ample supplies of reliable and affordable energy. A modern society that runs solely on electricity must have a foundation built upon three key pillars. First, it must provide lots of electricity, far more than is generated today, because U.S. electricity consumption accounts for only about one-fifth of total energy consumption. Second, all of that electricity must be available 24-7. Third, it must be affordable. Those pillars cannot be supported by reliance on intermittent wind and solar power and huge banks of batteries to store electricity when the wind doesn’t blow and the sun doesn’t shine. Nor will those pillars be based on technologies that don’t even exist, such as generators that run on pure hydrogen.
Even if one believes that addressing climate change is crucial and that low- or zero-emissions technology will yield worldwide benefits, the current approach is the most expensive way to achieve it.
Despite the hyperventilation of some politicians, such as Senator Sheldon Whitehouse’s predictions of doom, climate change need not entail economic suicide. A far better approach is adaptation to and mitigation of potential future damages that may be caused by a changing climate, such as gradual sea level rise and slightly warmer temperatures.
It is doubtful the U.S. will adopt this approach in the near future, because political expediency nearly always beats rational economics. But as economist Herb Stein said long ago, something that cannot go on forever, won’t. The unrealistic energy policies in place today eventually will collapse under their own weight. The resulting costs to U.S. consumers and businesses will be staggering.
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Jonathan Lesser is the president of Continental Economics and an adjunct fellow with the Manhattan Institute.
