Brexit’s Energy Lesson For California, et al.

Posted on Tue 06/28/2016 by

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Will Californians wake up and throw off the massive bureaucracy imposed in the name of “energy efficiency” and “renewables”?

Marita-Noon_avatar-80x80By Marita Noon ~

“California’s largest utility and environmental groups announced a deal Tuesday [June 21] to shutter the last nuclear power plant in the state.” This statement from the Associated Press reporting about the announced closure of the Diablo Canyon nuclear power plant should startle you. The news about shutting down California’s last operating nuclear power plant, especially after Pacific Gas & Electric Co. (PG&E) had sought a 20-year extension of the operating licenses for the two reactors, is disappointing—not startling. What should pique your ire is that the “negotiated proposal,” as the Wall Street Journal (WSJ) called it, is between the utility company and environmental groups—with no mention of the regulators elected to insure that consumers have efficient, effective, and economical electricity.

Diablo Canyon Nuclear Power Plant

Who put the environmental groups in charge? Not the California voters. But unelected environmental groups—and their bureaucratic friends in various government agencies—have been dictating energy policy for the most of the past decade. Regarding the “negotiated proposal,” the WSJ points out: “The agreement wades deeply into intricate energy procurement, environmental, and rate-setting matters that are normally the exclusive jurisdiction of state agencies.”

California has a goal of generating half of its electricity from renewable sources by 2030, and environmental groups are calling for the state officials to replace Diablo’s generating capacity with “renewable power sources.” Realize that this one nuclear power plant provides twice as much electricity as all of California’s solar panels combined.

Bloomberg Intelligence analysts’ research concluded that PG&E “would need 10,500 megawatts of new solar installations to replace all of Diablo Canyon’s output” at a cost, without including potential costs of new transmission lines or backup resources for solar, of $15 billion—with totals, including decommissioning, estimated at $20 billion.

The Bloomberg report states: “PG&E will ask that customers make up any shortfall.”

Actual costs, Bloomberg says: “could be lower because the company expects to compensate for lower demand and replace only part of the production.” Why will there be lower demand? The WSJ explains: “The plan calls for new power sources to furnish only a portion of the electricity that Diablo Canyon generates, assuming that greater energy efficiency in the future will also curb some power demand.”

All of this is announced while California is experiencing, and expecting more, blackouts due to “a record demand for energy” and because “there just aren’t enough gas pipelines for what’s needed,” according to CNN Money. “Southern California,” reports the WSJ, “is vulnerable to energy disruptions because it relies on a complex web of electric transmission lines, gas pipelines, and gas storage facilities—all running like clockwork—to get enough electricity. If any piece is disabled, it can mean electricity shortages. Gas is the state’s chief fuel for power generation, not coal. But the pipelines can only bring in about 3 billion cubic feet of working gas a day into Southern California, below the daily demand, which gets as high as 5.7 billion cubic feet.”

California’s Independent System Operator, which runs the state’s power grid, therefore, has warned of “significant risk” that there may not be enough natural gas which could result in “outages for as many as 14 summer days.” CNN Money reports: “Natural gas has played a bigger role for California as the state has tried to phase out coal and nuclear power”—environmental groups oppose the use of all of these three power sources.

It is expected that Diablo Canyon’s generating capacity will, in part, be replaced with more natural gas—which is good news for fracking. Eric Schmitt, vice president of operations for the California Independent System Operator, said: “California needs more flexibility in how it generates power so it can balance fluctuating output from wind and solar projects. Gas plants can be turned off and on quickly.”

As coal-fueled electricity has been outlawed in California, and environmental groups have pushed to close nuclear power plants, and routinely block any new proposed natural gas pipelines, blackouts will become frequent. California’s energy demand doesn’t match solar power’s production.

This dilemma makes “energy efficiency” a key component of the environmental groups’ decrees—which parallels the European Union’s (EU) policies that were a part of Britain’s “exit” decision (known as “Brexit”).

When the EU’s energy efficiency standards for small appliances were first proposed, then German EU energy commissioner, Gunther Oettinger, according to the Telegraph, said: “All EU countries agree energy efficiency is the most effective method to reduce energy consumption and dependence on imports and to improve the climate. Therefore, there needs to be mandatory consumption limits for small electrical appliances.” In 2014, the EU, in the name of energy efficiency, sparked public outcry in Britain when it banned powerful vacuum cleaners with motors above 1600 watts. It then proposed to “ban high powered kettles and toasters” as part of the “Eco-design Directive” aimed at reducing the energy consumption of products.

The EU’s Eco-design Directive’s specific requirements are to be published as “Implementing Measures”—which, according to Conformance.co.uk, are made “as European Law Commission Regulations.” It explains that this process allows the directives to “enter into force in all the member states without requiring a transcription process in their National Law. Thus they can be issued much more quickly than the usual Directive Process.”

When the EU’s high-powered toaster/tea-kettle ban was announced, it became “a lightning rod for public anger at perceived meddling by Brussels”—which was seen as “intruding too much into citizens’ daily lives.” When the ban was announced, retailers reported a spike, as high as 95%, in toaster and electric tea-kettle sales. The European overreach became such ammunition in Britain’s Brexit referendum, that Brussels stalled the ban until after the election and engaged in a now-failed public relations exercise with “green campaigners” to speak out in favor of the toaster and tea-kettle regulations that were believed to have “considerable energy saving potential.”

The Brits didn’t buy it. It is reported that at the top of the list for “leave” voters was “EU Rules and Regulations.” Matthew Elliot, chief executive of the Vote Leave campaign, said: “If we vote “remain,” we will be powerless to prevent an avalanche of EU regulations that Brussels is delaying until after the referendum.”

Brussels’ toaster and tea-kettle ban, which was perceived as an assault on the British staples, has been called “bonkers” and “too barmy to be true.” Specifically addressing the ban, Elliot said: “The EU now interferes with so many aspects of our lives, from our breakfast to our borders.” David Coburn, a UK Independence party MP from Scotland, who recently bought a new toaster and tea kettle, grumbled: “I think I must have bought a Euro-toaster, I have to put bread in it five times, and it’s still pale and pasty. Perhaps it’s powered by windmills. And the kettle? Watching a kettle boil has never been so boring.”

While energy efficiency directives banning Keurig coffee makers would be more likely to draw similar ridicule from Californians, there is a lesson to be learned from the Brexit decision: Too much regulation results in referendums to overturn them. It is widely believed that, with Brexit and new leadership, many of the EU’s environmental regulations, including the Paris Climate Agreement, will be adjusted or abandoned.

More and more Americans are reaching the same conclusion as our British cousins about the overreach of rules and regulations. As Coburn concluded: “What we want is to let the free market reign, not this diktat by bureaucrat.”

Marita Noon contributes posts at the CFACT site. She is the author of Energy Freedom, and she also serves as the executive director for Energy Makes America Great Inc. and the companion educational organization, the Citizens’ Alliance for Responsible Energy (CARE).

Read more excellent articles at CFACT  http://www.cfact.org/