Expensive and Dirty/Expensive and Dangerous

Pushing an entire nation back in time socially, politically and economically back half a century is really tough. Especially when the world cocks its head like a dog in quizzical disbelief… continuing along its merry way in the present day, dealing with present-day realities. But MAGA is predicated on undoing that half century of change, euphemistically the “Make America Great Again,” a meme for total retro mode.

Nothing evidences this distortion of past-as-future like the Trump administration’s energy policies. The sheer failure to appreciate the reduced value of fossil fuels – evidenced by a rather long-term collapse in oil prices – is addressed in my January 7^th blog, Drilling for Oil in Sensitive Places – The California Effect. Simply, the Trump administration believes that simply by lifting environmental regulations and opening up sensitive arctic and off-shore areas to exploitation, oil, gas and coal companies would rush to open new mines and build new drilling rigs. Based on simple economics, reduced demand combined with the exceptionally high cost of resource extraction from these sensitive areas creates a practical barrier to those plans: It ain’t a-gonna happen for very practical reasons. As long as oil, gas and coal prices remain depressed… and there are no serious economists projecting a rise in those prices any time soon… nobody is going to spend a huge premium to generate a product in a period of falling demand.

Oh, and the administration is clearly intent on messin’ with the blue states and their sensitive environmental areas… places like California that will fight any attempt to open up their coastal waters to oil drilling… but treating red states with deference. How do we know this effort is targeting climate-change-supporting blue states? Because Trump’s Interior Secretary, Ryan Zinke, has already exempted Trump-supporting Florida from any expansion off-shore drilling… at the request of the Republican governor of that state. “We’re not drilling off the coast of Florida,” Zinke stated at a news conference in Tallahassee.

The Trump administration is also touting an equally-unpopular increase in reliance of nuclear power, an energy system with a track record ranging from the Fukashima/Chernobyl/Three Mile Island disasters to the “what do we do with the waste?” issues and the hideous cost of construction and retrofitting.

So what does an administration do when it has pushed heavily for these old-world means of energy generation, especially when it has gone out of its way to reject the notion of man-induced climate change as “fake news,” and nobody is jumping to embrace these outmoded retro power systems and resources? When demand does not justify the risks, when the higher cost of power cannot be supported given the inherent higher costs? When job displacement, automation and simple economics continue to erode the employment picture in these older resource/power systems?

Simple. You lie and try to get regulatory and legislative bodies to mandate the use of these energy sources, even if they cost a lot more and even if such retro policies would of necessity displace the otherwise rapidly-rising alternative energy field, where the real “jobs, jobs, jobs” are. So Dancing with the Stars “star”, Energy Secretary (and former Texas Governor) Rick Perry moved to convince federal regulators that they must move to require fossil fuel and nuclear power generation as the only reliable answer to America’s energy needs. The January 9^th Los Angeles Times explains:

“A Trump administration plan to force utilities to purchase more coal and nuclear power was rejected Monday [1/8] by federal regulators, undermining the president’s energy agenda and his promise to revive the coal industry… The five-member Federal Energy Regulatory Commission, which is dominated by Trump appointees, unanimously rejected the proposal… Its members were not persuaded by arguments from Energy Secretary Rick Perry that solar, wind and other forms of renewable power were destabilizing the nation’s power grid and needed to be backstopped with more coal and nuclear power at a considerable cost to consumers.

“The contentious plan to prop up the coal and nuclear markets has been atop Perry’s agenda for months. The secretary had warned the proliferation of what he characterizes as less reliable renewables is undermining national security by destabilizing the grid.

“The market forces that are precipitating the closure of coal and nuclear plants, Perry argued to the commission, needed to be confronted with government intervention that would keep the fossil fuel plants online.

“But the commission reached the same conclusion as many independent energy experts who reviewed the Trump administration proposal, finding no justification for what could amount to multibillion-dollar price supports for the struggling coal and nuclear industries. The commissioners wrote in their decision that the considerable evidence provided by grid operators does ‘not point to any past or planned generator retirements that may be a threat to grid resilience.’

“They concluded that Perry’s plan to force ratepayers to pay coal and nuclear generators a premium for their energy to keep them from closing would amount to the government unjustifiably choosing winners and losers in the marketplace… ‘The record … does not demonstrate that such an outcome would be just and reasonable,’ the commission decision said.”

We know there is no such thing as “commercially-viable clean coal,” “completely safe nuclear power generation,” and “non-polluting gas and diesel power.” The world gets that, and even the United States is going the other way. “[A] new report by the Energy Information Administration, a research unit of the Energy Department, projected that utilities were preparing this year to shut down a near-record number of old coal-fired power plants. A coal mine operator announced a closure in Pennsylvania that would end 400 jobs. And oil and gas lease auctions on public lands in Alaska and across the West attracted weak interest from exploration companies…

“In the United States, the world’s second-largest producer, domestic coal consumption continues to slip, and production is 35% lower than its peak in 2008, according to the U.S. Energy Information Administration. The United States now generates 30% of its electricity with coal, down from more than 50% a decade ago… Oil markets also are erratic. Consumption in the U.S. is more than 1 million barrels a day less than it was in 2005, and it is leveling off globally.” LA Times.” Los Angeles Times, January 11^th.

But Donald Trump seems to want to destroy or at least hobble the high-growth alternative energy industry to favor fossil fuel at every turn, despite the countervailing global economic realities. He is even contemplating making solar panels more expensive by taxing well-priced imports. “Sometime before Jan. 26, Trump will rule on levying a tariff on imported crystalline photovoltaic panels, by far the most popular equipment in the U.S. for generating electricity from the sun.

“In October, the U.S International Trade Commission recommended levying tariffs on solar cells and panels of up to 35%. The president has full authority to follow that recommendation, opt for his own remedies or not to act at all. Industry executives warn that a high tariff would injure American competitiveness in renewable energy, one of the largest job-producing industrial sectors of the 21st century… ‘It would be very disruptive,’ said Mark Marion, a senior vice president at Juwi Americas, a developer of utility-scale solar power stations, based in Boulder, Colo. ‘It’s like driving a car fast and slamming on the brakes.’” LA Times.

If you choose to pretend that pollution simply does not matter, it’s amazing what conclusions you can reach. But the Trump administration is not only rather dramatically out of step with global trends on energy generation and climate policy, woefully under-informed on hard supply/demand market forces, but in order to “make it so” is willing to force Americans to pay more for these archaic, noxious and even dangerous energy systems.

Let’s see, higher costs, eroding future jobs, embracing truly dangerous or polluting power… what’s not to like? Does anyone on this planet really believe coal workers are working in a high-growth field? Got to love dem administration-supported alternative facts. Doesn’t take a mentally stable genius to see the folly in these absurd policies.

I’m Peter Dekom, and as much as Donald Trump believes that he can reverse the laws of physics and undo market forces to impose his 1950s vision of a “Great” America, one that flies in the face of reality, he really cannot… no matter how much his base might believe to the contrary.