If there is a good reason to short the Euro it may be the crushing cost of stupid green energy investments by countries like Germany, where they are shutting down their nuclear plants in an hysterical reaction to Fukashima, more than the tawdry finances of "club dead" countries such as Portugal, Greece and Italy. Looks like some of the German pols are finally waking up, but it is too late to save the competitive position of a German manufacturing facilities (unless they croak the Euro). More likely Berlin just departs or sees the southern tier nations gradually peel off once Germany runs out of money to subsidize them.
Europe, particularly Germany, went in big for wind farms in recent years. Nice idea – very green. Only problem is that large-scale wind power has pushed consumer prices for electricity past the breaking point for consumers and wind-farms have underperformed economically for investors since subsidies have bee cut back (see the Prokon filing article below). How does a wind-farm wipe out in Germany tell us anything about Cape Wind? The answer comes in two parts:
1. Because the wind does not always blow, utilities have to have access to conventional “spot” power supplies that are basically idle until called on (with little or no warning) This cost big money because the cost of having generating capacity available for an unpredictable phone call or computer message has to be paid for or the consumer has to be prepared to put up with black-outs and brown-outs. Essentially, for every KW of wind power there needs to be an offsetting KW of idle conventional power that somebody has to pay for – Hello Massachusetts consumers.
2. Transmission lines and grid interconnects for wind farms cost money and their cost needs to be amortized through higher consumer rates for electric power.
Basically, the Green party in Germany is out of the “great coalition” that Merkel had to put together after last fall’s election to form a government ostensibly because of some insensitive remarks by Green politicians, but the real reason is that Germany doesn’t want to do to itself with wind and other “green” dreams what Spain did with solar subsidies – wreck government finances and the national economy. If projects like Cape Wind go ahead, Massachusetts can learn the hard way, as the folks in Berlin and Barcelona did. Or we can look at the laws of physics (which drive weather) and engineering, which are universal and do not need a linguist to translate. They (and a sense of decency about what we put on households and employers) lie at the core of the argument against Cape Wind. What happened in Europe when promoters and politicians tried to ignore science and basic economics is just an illustration. But what an illustration! There is a popular Santayana quote that fits very well here: “Those who do not remember the past are doomed to repeat it.” An apt paraphrase might be: “Those who do not remember what happened to nations that ignored the everyday reality of basic science and household economics to chase a promoter’s “green” dream are destined to be eaten by it.”
On 1/24/14 windpark operator Prokon confirmed that it had filed for bankruptcy. Loses for the firm’s participation certificates are not yet known. Approximately 75,000 investors put up a total of .4 billion Euros ($!,820,000,000) for participation certificates.
Wind power is also under fire in Germany. Last November, In the last-minute sprint toward a coalition agreement between the CDU/CSU and the SPD, things got sticky where energy policy is concerned. The CSU will not accept an extension of offshore wind power procurement. “I reject any extension of procurement from expensive offshore wind farms” said the CSU’s State caucus representative for energy policy, Georg Nüßlein. “Irrespective of the fact that such an extension was never agreed to by the CSU’s state leadership coalition, it runs contrary to the CDU/CSU-SPD resolution to limit the costs of the “energy transformation.” Nüßlein demanded that the extension of current procurement policy be reconsidered. The federal Chancellor has also expressed concerns about the cost of offshore wind power.© Copyright 2014 Tanna K, All rights Reserved. Written For: Tinytown Unleashed