Posted on 10/19/2024 4:50:53 AM PDT by george76
Europe’s electricity has become so expensive that trade unions have started warning of the threat of deindustrialization.
Deepening Europe’s crisis, the Biden administration has announced a pause in liquefied natural gas export license approvals.
U.S. policymakers should heed warnings from Europe, and embrace a policy of making American electricity once again the most reliable and affordable on Earth.
Copied After years of misguided energy policies, Europe’s electricity has become so expensive that trade unions have started warning of the threat of deindustrialization. The warning will hopefully prove a salutary one for the U.S., which is now headed down the same road to energy serfdom.
Despite Germany shuttering its nuclear plants and sanctions disrupting the supply of Russian natural gas, the European Union has doubled down on renewable energy mandates, further constricting the supply of fossil fuel power. After soaring to 10 times their 2019 levels a year ago, Europe’s electricity prices have settled at triple their pre-pandemic levels. They are projected to remain at this level for some time.
When electricity prices rise, production costs soar along with inflation in virtually every sector, negatively affecting trade and investment across the economy. The chickens have now come home to roost.
According to the European Commission, industrial output in the Euro area plummeted 5.8 percent in the 12 months ending November 2023. Capital goods production was down nearly 8.7 percent. Investment in plants and equipment has plummeted. Europe’s current account surplus, which has averaged more than 3 percent of GDP for decades, was wiped out in a single year by soaring energy imports.
...
And there is worse to come. A survey by the European Investment Bank shows that energy cost in 2023 was the chief obstacle to firms’ long-term investment decisions. As recently as 2019, energy had barely been in the top five. For firms in manufacturing and services, the impact of energy on investment has been even more pronounced.
Europe’s trade unions are sounding the alarm. “We are facing a very worrying situation,” a senior European trade union official told Euractiv recently. “The lack of investment we are seeing today is already having dramatic implications for working communities,” he added, citing plummeting investment in buildings and equipment. “Factories are closing and jobs are being cut in the very sectors that lifted Europe to where it is today.”
Deepening Europe’s crisis, the Biden administration has announced a pause in liquefied natural gas export license approvals. Energy Secretary Jennifer Granholm claims the pause won’t affect the country’s “ability to supply our allies in Europe, Asia or recipients of already authorized exports.” But the market for LNG exports is global. With global demand increasing, and Europe particularly desperate for more LNG since Russia’s invasion of Ukraine, a restriction in U.S. exports anywhere will raise LNG prices for all importers. U.S. allies in Europe and Asia may soon be accusing President Biden of waging economic warfare against them.
Desperate to cushion the blow of soaring electricity prices, Germany is now plowing more than 4 percent of GDP into energy price mitigation for households and businesses. That’s almost the entire U.S. budget deficit in an average year. Decades of German fiscal discipline have vanished in a single energy shock, along with the ability of its industries to compete globally.
Great Britain is facing a similarly dire situation. In a devastating new report, Rupert Darwall notes that British businesses are paying almost five times more for electricity now than in 2004, and in 2022 paid 2.3 times what American businesses paid. Britain’s electricity prices would be even higher, but for its anemic GDP growth in the last two decades. That represents a lost generation of economic growth due in part to Britain’s self-destructive energy policies.
America has thus far been spared similar pain, but alas, it is headed down the same road. Buffeted by the anti-fossil fuel policies of the Biden administration and states such as California and New York, average electricity prices in the U.S. have risen 30 percent since the start of 2021. That has contributed to cumulative inflation of 25 percent since President Biden’s inauguration, wiping out a generation of wage gains for American workers.
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Making matters worse, Biden’s proposed electric vehicle mandates would significantly add to electricity demand, and his new power plant rules would force many coal and natural gas plants to shutter. If implemented, the new rules would wreck America’s electricity grid and make American electricity prices even more expensive than Europe’s.
Rising electricity prices could not come at a worse time. The revolution in artificial intelligence heralds a new age in America’s technological dominance, but only if America can keep its electricity prices low. The power requirements of AI are staggering. In 2021, Google alone consumed 18 terawatt-hours of electricity, more than many of the world’s nations. According to John Henessy, chairman of Google’s parent company Alphabet, a Google search assisted by AI can consume 10 times more electricity than a normal Google search. Powered by AI, Google’s energy consumption could triple by 2027.
Rising electricity prices bode ill for the competition with China. While U.S. electricity prices have soared since Biden’s inauguration, China’s prices have kept steady at a level about 31 percent below ours, and will likely decrease as the country continues building coal-fired power plants at a frenetic pace. China’s tech industry is quickly catching up to America’s and could meet Chinese premier Xi Jinping’s stated goal of surpassing the U.S. by 2030.
America has been at the forefront of every major technological innovation since the Industrial Revolution began, a major reason the U.S. became the world’s superpower. Part of the reason has been abundant energy supply. But that era could be coming to an end.
U.S. policymakers should heed warnings from Europe, and embrace a policy of making American electricity once again the most reliable and affordable on Earth.
For a preview of coming attractions, feel free to visit NYS.
It’s not pretty.
Already is.
That invented adjective means to close down or kill industries, correct? That can be done as a way of simplifying. But when it means shut down and just do without, that kills communities.
Steady here at $.12 per kwh
And what is directly responsible for High electricity prices? The “green movement” with the undependable and costly, as well as environmentally disastrous when they are recycled . Save us from these corrupt politicians and naive misinformed voters.
Don’t be stupid like Germany. And drill, baby, drill!
"Copied After years of misguided energy policies, Europe’s electricity has become so expensive that trade unions have started warning of the threat of deindustrialization.
The warning will hopefully prove a salutary one for the U.S., which is now headed down the same road to energy serfdom "
Well stated !
Germany is following the misguided philosophy of "Green Energy" and strict Dependency on only "Renewable Energy" sources.
Also, Germany is recording it's first ever deficit of its Gross Domestic Production (GDP),
and beginning its own self-directed debt spiral, and de-industrialization.
They even closed the Volkswagen automobile production.
“High Electricity Prices Have Europe Facing Deindustrialization; Don’t Let It Happen Here”
While this would be bad here in the US, literally NOTHING IS WORSE than Trump’s ‘tone’, he embarrasses me, therefore I’m with Harris. (how upper middle class whites view Trump)
While this would be bad here in the US for the little people, I have enough money to buy my way out of whatever the Democrats do, and, literally, NOTHING IS WORSE than Trump’s ‘tone’, therefore I’m voting for Harris. (how upper class voters view Trump)
While this would be bad here in the US, literally NOTHING IS WORSE than Trump’s ‘tone’, therefore I’m voting Third Party, and I don’t care if I go broke. (how stuck-up ‘conservatives’ view Trump)
Ours is steady at .065 per KWH.
Excuse......
European de industrialization is occurring because Euro industry is unable to compete with it’s betters.
Is that a steady rate for consumer electricity? Where is this?
What I am seeing where I live is increasing interest in “green energy & I think this can only lead to more expense for the consumer. Besides this, what is so all-important about AI that it should need so much expensive energy? Does the general public stand to gain anything from AI other than high electrical energy prices?
They’ve sacrificed their industrial base to Gaia. But now that is deemed not enough. So the Eurocrats are demanding they sacrifice their agriculture to Gaia too.
In other words they are socializing electricity.
They are robbing Peter to pay Paul's electric bill.
If the government allows the people to feel the pain of the government's anti-carbon policies the people might demand an end to the anti-industrial and human hating policies.
The government can't have that. The destruction of civilization is not reached the tipping point where violent revolution takes place.
Obviously, Biden’s policies need to be scrapped from day one. It really doesn’t matter if NY and California choose to destroy themselves with idiotic Gaia worship. As long as red states are not shackled to these idiotic self destructive policies by the federal government, they will be free to have sensible energy policies....thus reasonable energy costs....thus providing American companies a place to relocate to after they’re forced to leave Blue states. Given time, even people in Blue states will realize they are dying due to their own idiocy while red states are hoovering up all the factories and jobs. The pain just has to get bad enough and they’ll be forced to start acknowledging reality. Obviously they just haven’t had enough pain yet.
Click for a state by state comparison. Not sure of the accuracy
but it gives a comparison and varies across the USA. Electricity
rates in September of 2024
https://www.electricchoice.com/electricity-prices-by-state/
The Bimbo of Energy weighs in...
A hundred years from now there will be papers written by the country that wins the global economic wars that are always in process. The papers will focus on the idiocy of the countries that destroyed their power generation for the false claim of climate change. The papers will be written in Chinese.
The Europeans are eager to commit economic suicide to cure a nonexistent climate crisis. Hopefully the USA will not follow in their footsteps, but if Harris is elected we will.
They want your zip code. That’s reasonable enough. Then they want your everything. F that.
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