“No man is an island, entire of itself; every man is a piece of the continent, a part of the main. If a clod be washed away by the sea, Europe is the less, as well as if a promontory were, as well as if a manor of thy friend’s or of thine own were: any man’s death diminishes me, because I am involved in mankind, and therefore never send to know for whom the bells tolls; it tolls for thee.”
John Donne
Events in Germany are reminiscent of this work by John Donne.
Germany’s drive, Energiewende, to eliminate fossil fuels and nuclear power generation, and to rely on renewables, i.e., wind and solar, for 80% of its electricity by 2050, is leading to the death of Germany’s electric utilities.
If Germany’s utilities die because of Energiewende, the same outcome could happen in the United States from policies that mandate the use of wind and solar.
Today, only 22% of Germany’s electricity is being generated by wind and solar, yet the power generation and delivery system is already crumbling.
If German utilities are crumbling when only 22% of electricity is generated by wind and solar, what will happen to American utilities if Renewable Portfolio Standards (RFS) remain in place?
There are 31 states with RPS requiring that 25%, or thereabouts, of their electricity come from wind or solar by 2025. How will America’s utilities survive under these mandates?
The answer in Germany, at least, is now clear, they can’t.
E.ON, Germany’s largest utility has announced it plans to split into two companies, divesting itself of all fossil fuel and nuclear power generation assets, plus troubled assets in Russia and Brazil.
E.ON itself will then focus on renewables.
But what happens to the NewCo, where all the fossil fuel and nuclear assets reside?
Is E.ON spinning off what some might call a Bad Bank?
Who will want to own assets of a failing business?
One possibility is that the German government will pay NewCo to continue to generate electricity so that the lights stay on in Germany. In other words, a massive subsidy for which German taxpayers carry the burden.
Or, if no private enterprise wants to own NewCo, perhaps the German government will nationalize NewCo.
In either instance, it will be the death of electric utilities, as we have known them, in Germany.
And, if the bell tolls for German utilities … ?
* * * * * *
These articles can be delivered directly to your mailbox. Subscribe by clicking below the photo on the right side of the article where it says email subscription, and entering your email address. You can unsubscribe at any time.
If you know someone who would be interested in these articles you can send him/her a link to the article and suggest he/she subscribes by clicking on the email subscription link under the picture on the right side of the page, and entering their email address.
To find earlier articles, click on the name of the preceding month below the calendar to display a list of articles published in that month. Continue clicking on the name of the preceding month to display articles published in prior months.
© Power For USA, 2010 – 2014. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author, Donn Dears, LLC, is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Power For USA with appropriate and specific direction to the original content.
(7)
