L.A.‘s Green Energy Push Costly
By Don | April 5, 2010
The push for renewable energy has hit another speed bump. This time it's in Los Angeles where city officials are sparring with the local power company over large rate increases the utility says are needed to pay for the green energy.
According to the Wall Street Journal the city council is balking at the requests despite admitting that the utility will need more revenue and that a rate increase later this year is almost inevitable.
The city council which already approved an emergency 2.7 cents a kilowatt hour increase last month to combat a looming revenue shortfall at the Los Angeles Department of Water and Power, the nation's largest municipal utility authorized a 5% increase that was to take effect on April 1 but the utility's board moved for a larger increase which the council halted meaning that there will be no action for another 3 months.
In the meantime the utility will be providing energy to Los Angeles residents at rates that are below their costs of providing service which will only exacerbate the problem.
The city wants to get 20% of its energy from renewable sources by the end of this year and up to 40% by 2020 which they are on track to achieve but in their zest to go green officials failed to properly calculate the increased costs of building wind and solar farms and how that would affect rates. This isn't really all that surprising since green energy advocates tend to gloss over the costs while extolling the virtues of going green and doing the politically correct thing.
Granted coal isn't as clean as wind or solar but nuclear energy is even cleaner and cheaper but not politically viable in California even if President Obama supports the expansion of nuclear energy in the U.S.
Los Angeles has cast its lot with the green crowd and while it may make them feel better it will drive up electricity costs that could drive away businesses. The Journal quoted a spokesperson from brewery giant Annheuser Busch InBev NV that a rate increase would cost the company $2 million a year. The company is certainly large enough to absorb the extra cost but it will likely result in either higher prices to consumers or job losses or both to compensate for the added increase in expenses.
As city councilman Greig Smith told the Journal, the green push will cost a lot of jobs and doesn't shut down a single coal plant.
With cities and states under severe budget pressure it would seem that postponing or even better scrapping their renewable energy projects would be the prudent thing to do to not only save money but save jobs and their tax base.
Unfortunately politicians on both sides of the aisle would prefer to be politically correct than fiscally responsible which will only lead us further down the road to destruction.
http://www.aim.org/don-irvine-blog/l...y-push-costly/