Crashing the Economy to Destroy the Planet

It is common to talk about a tradeoff between the economy and the environment, the idea being that protecting and cleaning up the environment cost money that could otherwise be spent on consumption or investment. It’s a bit simplistic to make a sharp distinction, since not dealing with the environment imposes very direct economic costs, such as the destruction caused by climate change-linked hurricanes and flooding or medical expenses due to exposure to toxins in the air or water. Nonetheless, there is some logic in saying that addressing environmental problems costs money.

But it is not always the case that a cleaner environment costs money. Natural gas is a much cleaner energy source by almost every measure than coal, and it is also cheaper. When we switch to natural gas, we are saving money, in addition to helping the environment.

This is also the case with solar and wind energy. They now provide cheaper electricity than coal or natural gas. The average cost for solar is now around 2.4 cents per kilowatt hour. For wind it’s around 2.6 cents per kilowatt hour. That compares to 4.2 cents per kilowatt hour for natural gas. 

But these differences actually understate the case for wind and solar energy. While the cost of electricity from natural gas has been flat or trending slightly upward, the cost of clean energy, especially solar, has been plummeting. 

In a decade, the cost of solar electricity is projected to be less than half the cost of electricity from gas. There are, of course, big differences in cost across the country and there are problems with storage, but the cost of batteries is falling even faster than the cost of solar energy. And there is not a problem with having some backup gas capacity.

But the key point here is that in his “drill everywhere” policy and drive to build up liquified natural gas facilities for export, President Donald Trump is locking us into an antiquated technology. Who is going to want to buy Trump’s liquified natural gas when they can get energy from solar for half the price?

There is the point that it takes time to build up capacity, but the necessary time should not be exaggerated. Last year, China added 435 gigawatts of wind and solar capacity. The installed capacity for electricity generation from all sources in the United States is around 1,250 gigawatts, less than three years at China’s construction pace. Since wind and solar operate on average at a lower percentage of capacity than fossil fuel powered plants, it would be necessary to have more capacity, but this is still a target that could in principle be reached in a relatively short period of time.  

The story with Trump’s disdain for wind and solar is the same as the story of his hatred of electric vehicles. Trump insists, contrary to all evidence, that human-caused global warming is not happening. Not only does he refuse to have the government take any steps to slow global warming, he is actively pushing policies to accelerate the process. 

His drive to wreck the environment is going to make us pay more for both our electricity and our cars. Trump policies may hurt the economy and ruin the planet for our children and grandchildren, but at least he can say he owned the libs.