Between 2010 and 2016, coal’s share of U.S. energy fell from 23% to 15.8%, while renewables’ share climbed from 1.7% to 3.7%. In the EU, coal’s share fell from 16% to 14.5%, and renewables more than doubled its share, going from 3.9% to 8.3%. This emissions and economic progress by the EU is in jeopardy following the election of President Trump who is determined to boost U.S. oil, natural gas and coal industries, and push back on green mandates and subsidies. The EU’s response has been to isolate the United States for its climate position. Their strategy for overcoming high energy costs and exposure to energy disruptions is to make people choose expensive renewable energy in the guise of it being the only logical choice when confronted with the alternative of a disastrous environmental outcome if we continue burning fossil fuels.
As the EU’s strategy seems not to be working as well as planned, it has become more radical with governments seeking to ban internal combustion engine cars. This, its leaders believe, will force American auto companies to compete in the marketplace of zero-emission vehicles. Little is mentioned about the fact that the carbon emissions legacy associated with building electric cars requires years of driving them before it is neutralized. Electric car promoters also never mention the environmental and social costs of mining the rare earth minerals required in rechargeable batteries. If fairly presented, people might question whether there are other alternative solutions that are less-costly and do more to mitigate the environmental hazards of electric batteries and renewable energy sources.
While the goal to level the economic playing field with respect to energy’s cost in manufacturing remains an EU objective, the path to achieving that goal has changed. The choice presented is impending environmental disaster with continued use of fossil fuels versus feeling good about saving the planet with high cost renewables and zero-emission electric vehicles. Expect more of rhetoric as we move forward. Maybe President Trump understands that the climate change movement is really an economic war in the guise of climate change.
Here is a link to the full report.
The simple fact is the EU imports a lot of its energy and the USA is close to being energy independent. Quite whether the EU is so cynical in its attempts to pioneer high cost power is questionable, but if everyone were to adopt the same cost base for energy production it would certainly create a more level playing field for a lot of important industries and help European competitiveness.
Natural gas is one of the only commodities that trades at even close to the levels seen before the commodity boom. That is a testament both to the evolution of shale gas and how prolific supply of the commodity has been both in the USA.
UK natural gas futures are more than double peak levels seen in the 1990s which highlights both reduced domestic supply and dependence on imports.
Quite apart from the difference in monetary regimes these differences are contributors to the imbalance in growth between the USA and Europe over the longer term.Back to top