Month 8, Day 11: Paying The Piper By The Note

The New York Times ran an article on Portugal’s transition to renewable energy. It’s a good piece and well worth the read.

While Portugal’s experience shows that rapid progress is achievable, it also highlights the price of such a transition. Portuguese households have long paid about twice what Americans pay for electricity, and prices have risen 15 percent in the last five years, probably partly because of the renewable energy program, the International Energy Agency says.

Although a 2009 report by the agency called Portugal’s renewable energy transition a “remarkable success,” it added, “It is not fully clear that their costs, both financial and economic, as well as their impact on final consumer energy prices, are well understood and appreciated.”

My letter to the Times (I’m hoping for a third time in print this year!):

If Portugal’s citizens pay twice as much for their energy as Americans do, it’s tempting to seize on this as compelling evidence that renewable energy sources are doomed to failure in the marketplace. But such an analysis leaves out the crucial fact that America’s citizens have only paid for a fraction of their fossil-fueled energy consumption over the last century. We have bought our “cheap energy” on credit, deferring the expenses of cleanup and restoration to some point in the future. Now the bill is due, and it’s bigger than most of us expected. When the costs of environmental destruction, public health crises and global warming are factored in, Portugal’s “pay-as-you-go” renewable energy economy looks more attractive every day. America needs to make the switch soon; our dependency on oil and coal is both environmentally and economically unsustainable.

Warren Senders