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The wheels are starting to fall off the green energy bandwagon. The rose-colored glasses are clearing up and reality is sinking in.
The giant push toward a net zero utopia is not practical and has been a complete disservice to the American consumer. Components of the green movement are experiencing major setbacks, namely offshore wind, electric vehicles (EVs), and investments.
Offshore wind projects are struggling to secure financing and stay on track. The biggest blow came last month, when the world’s largest offshore wind developer Ørsted canceled two major projects off the New Jersey coastline, taking the wind right out of Gov. Phil Murphy’s green energy sails. Ørsted is also suspending work on offshore projects in Maryland and Delaware.
Among the wave of cancellations are projects in Massachusetts, Rhode Island, New York and Connecticut. Several other projects are on the ropes and a host of companies are paying millions to break their contracts.
The industry hit another snag recently when Germany-based Siemens Gamesa Renewable Energy pulled the plug on its wind turbine blade facility in Portsmouth, Virginia. Siemens Gamesa, one of the world’s leading suppliers, says, “development milestones to establish the facility could not be met.”
According to BloombergNEF, at least half of U.S. wind contracts have or are at risk of being terminated. The causes are typically due to skyrocketing inflation, high interest rates, choked supply chains and financial troubles.
Offshore wind is costly and difficult to implement.
The EV market is also losing steam. Sales are slumping and manufacturers are scaling back on production.
Ford Motor Company stands to lose $4.5 billion on its EV business for 2023 and will be delaying many of their EV investments.
General Motors said it was restructuring EV goals, Honda shelved plans to develop affordable EVs with GM, and Hertz said it will slow their rate of purchasing them due to high repair costs. Elon Musk is even considering putting off plans for a $1 billion plant in Mexico.
Most, if not all, manufacturers are reporting major losses per EV sold. Ford lost $62,000 per vehicle in the third quarter; one luxury electric vehicle company lost an astounding $430,000. Countless others are losing tens of thousands of dollars per vehicle, quarter after quarter.
Car dealers are slashing EV prices. EVs sit on lots nearly twice as long as internal combustion engines. Even industry-leader Tesla has been shaving thousands off their retail prices due to unmet sales expectations.
This kind of loss is not sustainable for any company.
The EV market is niche. Those who want one have one. But the rest of America is not convinced they would be better off with an EV on account of a multitude of reliability factors. Nor can they afford the steep price tag.
Consequently, the last few months have seen stock prices drastically dropping in companies across the green spectrum. From wind to solar to EVs to fuel cells, investors are abandoning the “green” energy ship in droves. It might be sinking.
Siemens Energy stock is down 45%; Ørsted, 67%; Power Inc., a hydrogen fuel cell producer, 71%; Charge Point Holdings Inc., an EV charging company, 70%; Blink Charging Co., another EV charging company, 72%; and Nikola Corp., maker of heavy-duty EVs, has gone from $65 a share in mid-2020 to the current price of less than $1 per share.
A recent Wall Street Journal article noted that such companies are “finding it more difficult to secure financing than at any time in the past decade.”
We need to read between the lines here. The green energy revolution is not working, nor is central planning. You cannot force Americans to buy cars they don’t want any more than you can force energy transitions that aren’t viable.
Green energy is wholly inadequate to meet the needs of all Americans, and turns out, is insanely expensive.
The World Economic Forum says that getting to net zero by 2050 will cost an extra $3.5 trillion a year. The U.S. has already poured hundreds of billions into the effort and continues to keep shoveling. All on the backs of the American taxpayer, to save a mere fraction of temperature. Maybe.
Heritage Foundation’s chief statistician estimates that even if all fossil fuels were eliminated from the United States, not even 0.2 degrees Celsius would be salvaged.
It’s time to quit throwing other people’s money into these projects and let the market dictate the solutions.