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Edwin Drake's |
There are several reasons why and they all involve money. Simply put, there's no financial incentive for alternative energy. Nobody wants to upset the apple cart. Here are a few reasons why.
Unlike fossil fuels none of the alternative energy producing schemes can be traded on commodity markets or exported. Let's use oil as an example.
In the United States alone we exported 1,920,000 barrels a day in 2009. At the time I'm posting this oil is trading for $91 a barrel on the NASDAQ. That's a $174,720,000 a day business.
Face it, trading in crude oil commodities is a is a trillion dollar club. In 2010 just two of these oil commodity traders combined traded 8.1 million barrels a day.
The CIA estimated there are 4,295 large oil tankers worldwide.
According to the IHS Petrodata Weekly Rig Count there are 110 active rigs in the Gulf Of Mexico as of March 1, 2013. In addition there are 840 worldwide currently active with about 298 of them being offshore drilling rigs.
This all adds up to hundreds of thousands of jobs, 4,295 ships and trillions of dollars daily simply going away if alternative energy were to come about. Take into consideration also how many fuel oil delivery drivers, gasoline stations, tons of coal & gas exports would simply vanish from the economy.
As one can plainly see with all those incentives not to change the status quo, alternative energy is going no where fast. With this much money involved, all of the above interested parties will continue to spend billions on corporate lobbying efforts in Washington D.C. to block all efforts towards alternative energy. There's simply too much money riding on keeping things as they are.
Yes, there is a huge lobby against change. Yes, there are many jobs tied to the current energy production system. But, I think you have come to the wrong conclusion and are missing some key themes that are playing out in energy/alternative energy.
ReplyDeleteFirst, take a look at coal, which is a dying industry. Part of the reason is it is being properly regulated, but part of the reason is that it is no longer cost effective compared to alternatives. A large amount of coal-based electric plants are scheduled to convert over to natural gas by 2020. It is simple economics that will continue on well into the future. In the meantime, solar and wind energy (best example is NextEra [NEE], formerly known as Florida P&L) are becoming more cost effective every year as the technologies develop.
Second, look at what is happening in Corporate America. WalMart is installing solar panels on the roof of a store for the first time, sports stadiums are doing the same ... even Pocono Raceway is on the solar bandwagon. Why is this happening? Because it makes economic sense regardless what some oil lobbyist tells your Congressperson. Even better than that, most every large corporation today has a "C" level executive whose area is sustainability (CSO). At UPS, they are in the middle of a five year plan to decrease fuel usage by 20%.
Finally, look globally what is happening. China has decided coal is not in their best interest as the air in many areas looks like LA in the 1970s. Germany has embraced solar while Norway plans on being carbon neutral in the next few years. That is carbon neutral as a country, not a house or a small village.
It is happening and will happen faster and more efficiently if the Federal Government would simply invest in the basic research. Old jobs will go away and new jobs will come about... but that is how it has always worked. Schumpeter called it "creative destruction."
As a side note, here is an interesting look at how Global Warming can become a thing of the past without crazy stuff making it happen: http://www.theatlantic.com/business/archive/2012/09/the-end-of-global-warming-how-to-save-the-earth-in-2-easy-steps/262418/