German Study Shows Green Energy Comes at a High Cost

Some American politicians frequently tout the European model as a shining example of energy policy, citing government policies there promoting alternative energy over the past decade. Recent studies out of Spain and Germany, however, indicate that those two countries have been successful in increasing the amount of alternative energy but at a high cost to their economies.

In March of this year, a Spanish study from Universidad Rey Juan Carlos found that the creation of green jobs in Spain cost the Spanish taxpayers more than $600,000 for every green job created. Even worse, the Spanish economy lost 2.2 jobs elsewhere in the economy for every green job created.

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The Rheinisch-Westfalisches Institut für Wirtschaftsforschung study, "Economic Impacts From the Promotion of Renewable Energies: The German Experience," presents more bad news for the green economy. It reports that "government's support mechanisms have ... resulted in massive expenditures that show little long-term promise for stimulating the economy, protecting the environment, or increasing energy security." Those are three of the most often mentioned benefits of alternative energy.

The study found that in the case of solar power the subsidization regime in Germany has reached a level of $240,000 per worker. Solar power requires an 800 percent subsidization to remain competitive while wind power requires a 300 percent rate of subsidization.

Evidence continues to mount that green energy mandates in Europe have not created new economic opportunities, but instead have resulted in unsustainable government subsidies that raise the cost of energy to European households and contribute to making European business less competitive.

A U.S. Environmental Protection Agency press release from  Oct. 27, 2009, indicated that EPA Administrator Lisa Jackson, Energy Secretary Steven Chu, Interior Secretary Ken Salazar, Transportation Secretary Ray LaHood and Federal Energy Regulatory Commission Chairman Jon Wellinghoff will testify before the Senate Environment and Public Works Committee. According to the EPA release, this group will focus on the importance of creating a system of clean energy incentives that will spur the development of new sources of clean energy and create millions of green American jobs while confronting the threat of carbon pollution. Let's hope they have read the Spanish and German studies. It is probably too much to expect that Congressional members would have read the studies when they do not even read the bills they vote on.

It is becoming clear that if we follow the European lead on energy policy we will end up with the same results — increased energy costs, loss of jobs and little or no environmental gain. It is time to stop the madness now.