There is never a good time for bad public policy. For few policies is this more evident than renewable energy mandates (REM), variously known as renewable portfolio standards, alternative energy standards and renewable energy standards.
The first renewable energy mandate was adopted in 1983, but most states did not impose these mandates until the 2000s. Though the details vary from state to state, in general, renewable energy mandates require utilities to provide a certain percentage of the electric power they supply from “renewable” sources, notably wind and solar, with the required percentages rising over time.
At the height of the renewable-energy mania, 30 states and the District of Columbia had imposed REMs and another seven had established voluntary standards.
Renewable energy mandate proponents included environmental lobbyists with a hatred for capitalism and fossil fuels that make modern society possible, crony socialists who saw the mandates as way of strong-arming exorbitant payments from government and ratepayers alike, and paternalistic politicians who look down on people’s choices in the marketplace, believing they know best what sources of energy people ought to choose.
Green-energy advocates, crony socialists and government elitists have seen their fortunes wax and wane over five decades. Government subsidies for unreliable, expensive renewable fuels had risen, fallen, been scrapped and begun anew since the 1970s. The existence and amount of subsidies tended to rise in fall with various energy crises — crises often created by the same government that then proposed subsidies for renewable energy as the solution for the problems it created.
For 50 years, green-energy gurus in industry and the environmental movement have sold the snake oil that renewable power would soon be as cheap and reliable as coal, oil, nuclear and natural gas. The nation has been told the turning point has always been just around the corner, always requiring a little more public funding and tax breaks before we have abundant, cheap, clean, reliable energy materializing from thin air.
All these promises were false, and the public and more-honest politicians have seen through the sales pitch. Now, support for renewables is as unreliable as the energy it provides.
To guarantee a market for renewables, green lobbyists fought successfully for mandates ensuring green-energy producers a slice of the electricity market regardless of the price and quality of the energy they produced.
Energy prices skyrocketed, as predicted by numerous energy analysts.
Though cost is an important concern, it is not the only problem with renewable power sources. Renewable energy is not environmentally friendly. Renewable energy mandates have turned millions of acres of wild lands and wildlife habitats into a vast wasteland of wind and solar industrial energy facilities. In the process, renewable energy facilities have condemned to death hundreds of thousands of animals, including endangered birds, bats and tortoises. Finally, the construction and maintenance of these facilities have polluted the air and water. There is nothing green about all this. Still, continuing high costs, not environmental concerns, may finally spell doom for the mandates.
Citing high costs, Ohio became the first state to freeze its renewable energy mandate. Under Ohio’s mandate, utilities would have been required to provide 25 percent of the state’s electricity from qualified renewable sources by 2025. Under a law signed by Republican Gov. John Kasich in June 2014, Ohio froze its mandate at the current level of 12.5 percent, halving the mandated level.
In January, West Virginia repealed its renewable energy mandate entirely, and the New Mexico House of Representatives passed a bill freezing the state’s renewable standards in March.
Kansas has also recently held hearings on repealing its renewable energy mandate, spurred on in part by a new report from Utah State University reporting Kansas ratepayers are paying $171 million more than they would without the mandate. These additional costs have resulted in a loss of $4,367 each year in household disposable income.
What’s true for Kansas is true for other states with renewable energy mandates. States with mandates experienced 10 percent greater unemployment, due to higher energy prices resulting from the REM, than states without mandates. In addition, the U.S. Department of Energy has found electricity prices in states with renewable energy mandates have risen twice as fast as in states with no renewable requirement. Electricity prices in states with mandates are 40 percent higher than in non-REM states.
With these facts, it is little wonder that states are doing a slow walk back from their previous support of costly, environmentally harmful renewable energy mandates. It’s a classic case of legislate in haste, repent in leisure.
• H. Sterling Burnett is a research fellow on energy and the environment at the Heartland Institute.