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OWOE - Blog
March 19, 2024

Guest blog by S. A. Shelley: Change is inevitable unless you're well established. There is a reason why empires are lost to history, governments are overthrown, businesses collapse, and academia becomes irrelevant. The established organizations or systems could not change fast enough to respond to imminent threats, emerging technologies or changes in consumer habits.  When faced with such challenges established systems, especially governments, harden themselves. In extreme cases you end up with kingdoms such as North Korea. But in most cases, you end up with economically declining and socially irrelevant states like Canada. It is a problem of ossification of thought, of edicts being churned out ever more frequently with worse effects. It applies to everything from healthcare and education to defense and energy policy.

With regards to energy policy, a great example of ossification is the California government's unyielding desire to have massive floating offshore wind farms to power the state. California has numerous times proclaimed a goal of 5 GW installed by 2030. If you read the press releases of every government person in California from municipal to state level, it is all golden sunshine, and beach walks to clean energy. But this is fanciful group thinking influenced very much by a very small group of wind energy business interests.

As we have noted in a prior blog (see OWOE: California Does Not Need Big, Very Expensive Floating Offshore Wind Farms), California doesn't need big offshore wind farms to become a clean and green energy state: California politicians want it but California doesn't need it. Governments always want: They want your taxes so that they can make equitable distributions. They want you to only use approved language. On and on. And in California, the government wants you to pay dearly to develop an industry that California doesn't need and for which California is ill suited to develop. Yes there are a lot of good offshore wind resources in California, but no there is not enough industrial infrastructure available and probably not enough state funding subsidies to support California's big wind dreams (see CalMatters: 'A massive enterprise': California offshore wind farms are on fast track).

Amounts between $20 to $30 billion dollars are bantered about (see NREL: What Will It Take To Unlock U.S. Floating Offshore Wind Energy? and RechargeNews: US West Coast needs $30bn for ports and supply chain to unlock 55GW of floating wind: study) to build-out some California ports just to support the deployment of the wind platforms. This cost does not include one single floating wind unit and is just the cost to "prepare" for the first floating wind unit. Remembering how frequently government projects overrun costs, to be safe, I would estimate that such infrastructure build-out costs to be at least double, between $40 to $60 billion.

Is there a better way to spend $20 billion in California on green energy? Of course, but it’s not politically in vogue. The average cost of a 5kW solar residential installation in California is about $15,000. Let's add another $10,000 for the residential battery system to help address the issues surrounding grid capacity management caused by solar power (see OWOE: What is the duck curve?). Doing some arithmetic, that means that by purchasing about 800,000 residential solar installations for $20 billion the state of California could supply about 4 GW of rated capacity for the same amount that the state and federal governments are willing to spend to just get California’s infrastructure to prepare for offshore wind farms. As an added bonus, solar panel efficiency is improving, and battery storage is getting cheaper, while offshore wind turbines are only getting larger and more problematic to install and operate. So why would anyone want to go offshore when onshore solar power is a cheaper and bigger choice?

California is blessed with abundant solar power potential, and there are still many, many ways that this power potential has yet to be developed, at less cost and with less environmental disruption than going offshore with huge wind farms. The Solar Energy Industries Association (SEIA) projects that California is on track to install another 19 GW rated solar power in the next five years. Again, this can be achieved without the expensive infrastructure build-outs required to get just 5 GW rated floating offshore wind power by 2030.

Consequently, once a politician's or the political class mind is set, ossified, then a lot of consultant dollars will be spent to convince the populace of the infallibility of the politicians, the state board, the consultants or whatever (see postscript, below). There are better, more equitably distributed and green alternatives to offshore wind in California, it's just that the politicians can no longer see nor comprehend those solutions.

This happens across a lot of jurisdictions. California does not have the industry nor the infrastructure space to support offshore wind farms, but the politicians want it. Conversely, Texas has the industry and the infrastructure space for offshore wind farms, but the politicians don’t want it.

The populace needs cheap and reliable energy and green energy can be a big supply for that. But the way that politicians are going about forcing green energy on people is most often the wrong way and we’ll all suffer for it. Unfortunately, once ossification sets in, it becomes very difficult to change the mindset.

Vive l'Alberta Libre

Vive la libre pensee!

Postscript: A great example of ossification and politicians trying to influence voters is in Calgary, Canada. There, the last two municipal governments have decided on a new transit line, the Green Line. The politicians picked the most expensive option available and hired one of the most inept and corrupt major engineering firms to manage the project. Subsequently, many citizens of Calgary began questioning the Green Line decision. The mayor and city council have started fighting back ("How dare you …question our magnificence?") by instigating a massive public information campaign comprising of such statements as "90% of Calgarians agree that the Green Line is needed and will benefit the city!". Or, and this is one of my personal favourites, "The Green Line Board and Executive Committee is comprised of highly experienced and knowledgeable people." So too was Long Term Capital Management before it almost crashed the economy in 1998. These pronouncements by Calgary city staff are meant to nudge group harmony (see also the Fraser Institute: The dangers of nudging—the use of state coercion to affect behaviour). But what the Calgary city politicians omit is that 85% of Calgarians question why the city chose the most expensive option and hired the most corrupt firm. In Calgary, the city council can't even install picnic benches properly in a park.

Calgary picnic benches

Why then should people believe that the city council can wisely decide and effectively manage an uber expensive multi-year infrastructure project?

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