Did the Alternative Energy Bubble Burst, or Has It Been Deflating All Along?

Over the years, as the coordinator for think tank, I have been privy to read many business plans made by entrepreneurs trying to cash in on the free flow of money propping up the alternative energy sector. As you know when the government starts giving away the taxpayers money, people in the private sector start lining up to collect that money. Of course, due to the political nature of the alternative energy sector much of that money was already allotted for friends of politicians in high places. Rather than go into details in this article I’d like to talk about how all good things come to an end.

You see, many of these business plans that I had read were obviously flawed, and those companies if they had started, those startups wouldn’t have ever made any money. Their energy innovations were interesting, but not really viable next to fossil fuels, not without government subsidies. Speaking of which there was a rather interesting article on March 29, 2013 in the Wall Street Journal; “State Schooling to Renewable Energy-Bills to Curb Requirements for Utilities Crop up Nationwide, Generally in GOP-Led Legislatures,” by Ryan Tracy.

You see even though the global warming alarmist did such a bang up job convincing people that we needed to curb our CO2, the expense to the taxpayer was rather outrageous. With the failures of Solyndra, A123 Batteries, and many giant solar farms the taxpayers have had enough. Interestingly, there was another article worthy of mention published on April 2, 2013 also in the Wall Street Journal titled; “Wind Power Subsidies? No Thanks.” By Patrick Jenevein which had an interesting quote; “I’m in the green energy business. If Washington sent a little less ‘green’ our way, it would be good for the industry.”

What he’s saying is what any free-market economist would note, and that is when you throw money at something you make it in efficient and whenever government gives away money there are always strings attached, complicating the potential for ever making a profit. Perhaps this goes back to Ronald Reagan’s famous quote “if it moves they tax it and if it stops moving they subsidize it.” Yes, there’s just too much intervention in our free-market economy, it’s not healthy, and the government simply can’t afford to be wasting money in this way.

Besides that, the bulk of the energy innovation has come from the fossil fuel sector, Fracking for instance. Now we have an abundance of natural gas which hardly puts out any CO2 compared to coal-fired plants. Wind power cannot compete, certainly not when it is operating inefficiently. There was a point when wind power was so heavily subsidized, that the operators could give the energy away for free and still make money. That’s just insane if you ask me. Please consider all this and think on it.