The Silent Killer of America’s Economy

By Marita Noon

The Middle East and the Midwest unrests occupy the nightly news. The unintelligible rants of Muammar Gadhafi and Charlie Sheen fascinate the public. Meanwhile a silent killer is moving behind the scenes—virtually undetected.

Perhaps a bit melodramatic but energy use and America’s economy go hand-in-hand. So, any efforts to reduce energy availability or increase costs serve to kill a recovery that is barely clinging to life. Such campaigns are pulsating throughout the country.

This silent killer is the RPS—or Renewable Portfolio Standard. “Silent” because few, even within the energy industry, are aware of its presence or impact—let alone the consumer. With little media or public attention, 29 states have enacted an RPS and seven more have agreed to voluntary goals.

The RPS is a legislated mandate requiring a certain percentage of a state’s electricity “portfolio” to come from renewable energy (typically referring to wind and solar) by set dates—most states are 10 percent by 2010, 15 percent by 2015 and 20 percent by 2020. In his State of the Union Address, President Obama announced that he’d like to see 80 percent clean energy by 2035. Renewable energy is known to be more expensive for the consumer than electricity generated from traditional sources—even with subsidies of about $24 per megawatt hour. In support of regulations aimed at increasing the use of renewables, a proponent stated, “The reason for Renewable Portfolio Standards (RPS) is because renewables are more expensive. No one would choose them if it wasn’t required.”

Despite the high cost and intermittent availability, renewable energy is touted as the savior and environmental groups lobby legislators to push for mandates—or higher mandates (as in California and Colorado) when they’ve already voted in the RPS. But, from what is renewable energy “saving” us?

The need for renewables is based on two lies. The first is that we “need” to get off of oil. Yes, we do need to get off of our dependence on oil from regimes that hate America, but we have plenty of oil here. There is no shortage. Access shortage, yes – oil shortage, no. (Plus, insignificant amount of electricity comes from oil.) The second lie is that we must use “clean” energy—meaning one that does not produce CO2. This premise is based on the theory that CO2 causes global warming, global warming is human-caused, and stopping CO2 emissions will save the planet.

Based on these fallacies, states—and even the federal government—are knowingly mandating more expensive energy. Senator Bingaman, Chairman of the Senate Energy and Natural Resources Committee, has repeatedly advocated a national RPS of 15 percent called a Renewable Electricity Standard (RES). Several states are looking at enacting an RPS or increasing what they already have. (All of this, while support for climate change legislation and/or regulation is waning. Many states have bills that will reverse, reduce or modify their RPS. Promise of a potential repeal was part of Governor Kasich’s successful campaign. New Hampshire is the first state to pull out of their participation in the Regional Greenhouse Gas Initiative.)

Regardless of whether state or federal, a new study reveals that these mandated renewable energy requirements will deliver a “devastating blow” to the economy. The American Traditions Institute (ATI) has analyzed the potential for a national standard at various percentages and the existing RPS from several states. Though the exact numbers differ, the results were the same. Energy prices will increase for both individual citizens and industry. Jobs will be lost and household expenses will climb.

At a time when cities and states are facing record budget shortfalls, the RPS will also inflate their costs. A 2010 report card on Renewable Portfolio Standards by State reveals that the cents per kilowatt-hour are generally higher with states with an RPS—and this is before they meet their ultimate goals. Local governments pay for the lights, heating and cooling, elevators, and computers in government buildings. They pay to keep the streets lit. Leaving cities in the dark will cause crime to rise.

According to the American Legislative Exchange Council, 18 states currently have legislation proposed or pending, 44 bills, relating to the RPS. Yet, no one seems to know what an RPS is. Fewer are aware of the potentially lethal impact the RPS, or RES, could have on America. It is not that renewable energy is wrong. There are many cases when wind or solar are the best option. But mandates that raise costs could add fatal pressure to the American economy. Renewable Portfolio Standards are the silent killer.

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Marita Noon is the Executive Director at Energy Makes America Great Inc. the advocacy arm of the Citizens’ Alliance for Responsible Energy. Find out more at http://www.EnergyMakesAmericaGreat.org.

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