The Fork in the Road - ORIGINAL CONTENT

The United States electorate reached “The Fork in the Road” last Tuesday. They chose the fork to the right, away from the Green New Deal, Net Zero by 2050, “all-electric everything”, electric vehicle promotion, renewable generation and massive federal subsidies; and, toward a rational economic transition to advanced energy technologies.

The new Administration can be expected to restore scheduled leasing of federal land and offshore tracts for oil and gas exploration and to end the “slow walking” of exploration, development and production permitting. It can also be expected to support LNG exportation.

Federal government support for offshore wind development will likely be dramatically reduced, since offshore wind generated electricity is several times more expensive than current wholesale electric rates in the markets it would serve and would therefore increase electricity prices.

The end of “all-electric everything” will reduce the rate of growth of electricity consumption and demand and the generation and transmission infrastructure growth required to serve load growth.

Reduction or elimination of subsidies and mandates for renewable generation and storage would require those technologies to compete fairly with alternative generation technologies. Since intermittent renewable generation requires backup from conventional generation or storage, it is parasitic to the electric grid and is redundant capacity which has increased generation and transmission investment and cost.

Unfortunately, the renewable generation which has already been installed has increased the average wholesale cost of electricity, increasing operating costs throughout the US economy and producing inflation which is, to a large extent, ”baked into” the economy. The Administration’s efforts to reduce energy costs will be limited by the existence of this redundant capacity.

The new Administration is expected to renounce the “all of government” effort to reduce CO2 emissions, withdraw the EPA Powerplant Rule and the EPA vehicle fuel economy standards which constituted an effective electric vehicle mandate and withdraw the onerous SEC emissions reporting requirements.

The new Administration is expected to exit the Paris Accords again, discontinue contributions to the UN Green Climate Fund and actively resist the UN effort to establish a “loss and damage fund”.

The Administration can be expected to work to halt and reverse our growing dependence on China, particularly with respect to rare earth minerals. The expansion of solar and wind generation has increased our dependence on China for raw materials, processed materials and finished goods. This has not been a serious issue to date, because we are not dependent on solar and wind to meet our electricity requirements. However, as renewable generation plus storage would have grown and replaced conventional generation, we would have become dependent on it and would have been at risk when it became necessary to replace the wind, solar and battery infrastructure. China has demonstrated a willingness to restrict export of rare earth minerals critical to the operations of US industry and the US military. We ignore dependence on unfriendly nations at our peril.