Europe’s green energy policies have sent its electricity prices sky-high and are thereby threatening the continent’s competitiveness on the world stage. Stanley Reed, writing for the NYT, diagnoses the root problem with the green road Europe has traversed:
The problem is that much of the rest of the world did not follow. Europe will very likely succeed in meeting or surpassing its original goal of a 20 percent reduction in emissions from 1990 levels by 2020, but these policies may have encouraged investment and employment to shift elsewhere. Recent European Commission studies have shown that Europe’s share of global foreign direct investment fell to 16.8 percent in 2012 from 30 percent in 2008. In roughly the same period, Europe lost 3.5 million manufacturing jobs.
The key is for Europe to persuade countries like the United States and China to adopt similar policies. There may be more hope of that happening: Many businesses, including some oil companies, are preparing for a global policy shift that would be more in line with what Europe is pursuing.
Let’s review. The problem with Europe’s rising electricity prices are that prices in the rest of the world aren’t rising with them. To fix that, we should raise prices elsewhere. Problem solved!Or maybe…instead of foisting the ill-conceived green energy policies that Europe is quickly coming to regret on the rest of the world, we could focus on strategies that promote both economic growth and better environmental stewardship. Such policies do exist. We’re getting better and better at producing more dollars of GDP per unit of energy input, and the accelerating pace of technological improvements promises even better returns down the road.Moreover, the developed world’s impending transition to the information economy naturally dovetails with the idea of sustainable development. Manipulating information is a lot less energy intensive than making things; new business practices like telework allow companies to seek the best talent—where ever it may be found—while saving money on office space and, yes, cutting down emissions associated with commuting.None of those options require massive government subsidization regimes. None raise electricity prices. Picking these low-hanging fruits is the best way to balance environment and economy, because doing so doesn’t require accomplishing one goal at the expense of the other.