It Can Be Done: Part II

A few weeks ago I wrote about how fast Portugal developed its renewable energy sources (It Can Be Done, And Quickly) and referenced a NY Times article.  Today, another two articles caught my attention.

• Canada Produces Strain of Algae for Fuel details how a company set up to produce Omega-3 food supplements in Halifax, Nova Scotia stumbled onto a strain of algae capable of producing up to sixty times more triacylglycerol oil (a biofuel base)  than similar micro-organisms.

• Ancient Italian Town Has Wind at Its Back goes into how a small mountainous village in the center of Italy installed a few wind turbines and is now a net electricity producer, generating extra income for community purposes.

It is increasingly obvious that green/renewable energy is fast becoming a reality outside the U.S. , which is still stubbornly stuck in an energy Middle Age.  It's like Americans refuse to see past their own neck of the woods.  They are willfully blinded by the supply of cheap, but vastly inefficient, "timber" from their forest and cannot accept that "trees" are becoming scarcer and dearer in more ways than one.

Let's wake up and look things squarely in the eye: the only way to promote fast development of  renewable energy is to make it economically attractive via direct positive and negative incentives (guaranteed prices and taxation).  Everything else is wishful thinking and hot political air.

The second article says it well:

At the same time, the costs of renewable energy have been falling rapidly. And as in much of Europe, the lure of alternative power here was sweetened by feed-in tariffs — government guarantees to buy renewable electricity at an attractive set price from any company, city or household that produces it.

In the United States, where electricity is cheap and government policy has favored setting minimum standards for the percentage of energy produced from renewable sources rather than direct economic incentives like Europe’s feed-in tariffs, stimulating alternative energy has been only mildly successful. But in countries where energy from fossil fuels is naturally expensive — or rendered so because of a carbon tax — and there is money to be made, renewable energy quickly starts to flow, even in unlikely places like Tocco. 

Many will say that such policies and direct government interventions are not the way America does things, or that it makes no sense to raise energy prices and taxes during a crisis.  I strongly disagree.  We urgently need to look at alternative energy as a driver of growth, instead of as a drag.  As the world's biggest consumer of energy (see chart below), the United States can and should revamp its energy regime.

 Data: EIA

The sheer size of American energy consumption means that changing the outmoded energy infrastructure will take a long time to accomplish;  but that's is a good thing, it's a way to create millions of new jobs, technical know-how and investment spending, i.e. activity that will sustain the real economy for decades.

Notice how the renewable energy articles are ratcheting up to much bigger economies. It is  perhaps easy to dismiss developments in tiny Portugal (#37 by GDP) or Denmark (#31).  But Italy (#7) and Canada (#10) are the real deal, ladies and gentlemen.  If we continue to ignore such news, preferring instead to keep our heads in the sand, we will end up in the "Empires For Recycling" bin of history.  

Just ask the Athenians.  Or the Romans. Or the Brits.