Spending Like There Will Be No Tomorrow

US DOE Loan Program

The US Department of Energy Loan Program Office (LPO) is quite proud of its work.

When you go to the Our Projects page it explains that “LPO is one of the largest and most productive energy project finance operations in the world and has committed over $30 billion to support 42 clean energy projects.  These projects create or save over 66,000 jobs across 38 states.”

Consider this:  That $38,700,000,000.00 spent or committed to date by the US DOE loan program has created (or saved) 65, 578 jobs in the clean energy economy.  By my calculation that is $590,137 per job!  As a taxpayer my reaction is

Please Don’t Help Me Anymore I can’t Afford it!

And there in a nutshell is the reason that there are growing doubts about whether the US DOE loan program that has been used to underwrite renewable energy, smart grid and other aspects of the clean energy economy aspirations of our government is (pardon the term) sustainable!

It’s not that these are not good projects.  Many of them are.  It’s not that we disapprove of living into a clean energy economy future.  We do.  But having been preached to endlessly until we are green in the face about sustainability we have come to realize that we are not sustainable at these levels of spending even on good causes. It is time to emancipate the children and let them compete in the real world.

The clean energy economy does us no good if we are bankrupt when we get there.

The ‘inconvenient truth’ is that the best technology and least emitting energy sources are no good if we cannot afford them, if they are not profitable to sell competitively, and if they undermine the rest of our economy because they have been politically correctly slotted to take the place of resources that are still used and useful, more reliable, more affordable and are still working even if not perfect.

The energy security inconvenient truth is that the government policy of regulatory torment being imposed on fossil fuels especially coal risks forcing the retirement of our low cost, reliable baseload generation before there is an adequate replacement for it.  We have built renewable energy wind and solar resources at a fierce pace over the past few years but the sum of that capacity is a small fraction of the coal capacity threatened with premature retirement.  All of that renewable energy must be backed up with fossil fuels to be reliable.  The practical result of this policy is to set the stage for a serious risk of energy shortage and reliability problems when our economy finally begins to grow again.  Look at ERCOT today where despite all its wind energy it struggles to meet peak demand because the wind does not blow when the temperatures soar except in the State capitol!

We are not making our power grid smarter we are making it more politically correct, but that will not assure that we can keep the lights on or provide the low cost energy needed to power jobs growth and compete in a global economy that is driven by efficiency of the bottom line financial kind.