Biden’s green economy will break the energy grid

The United States economy is in danger of running out of power. After a decade of flat demand, electricity demand is set to grow by 80% by 2034. The grid and the Biden administration are not prepared. The sudden increase in demand is being driven by both the market and by politics. The market is responding appropriately to demand signals. But the Biden administration is asleep on how to respond. 

The artificial intelligence, or AI, revolution is a major explanation for why electricity demand is exploding. Accelerated computing powered by semiconductors requires multiples more power than old fashioned data centers. The major U.S. technology companies are investing aggressively in new data centers. AI will dramatically increase the productivity of the U.S. economy and accelerate economic growth, but AI requires a lot of power.

Cryptocurrencies, too, require an immense amount of electricity. People, in part, invest in cryptocurrencies in the belief that the federal government will default on the national debt.  Cryptocurrency enthusiasts look at the large deficits accumulated under the Trump administration and now with the Biden administration and purchase crypto assets as a hedge.

The third major cause of the secular increase in demand for electricity is the Biden administration’s pursuit of a green economy. Through the inaptly named Inflation Reduction Act, the administration is providing $1.2 trillion in subsidies to transform the U.S. economy from carbon-based electricity to green energy electricity. But the Biden administration is blind to how much electricity is required for a green economy.

U.S. companies are in the process of constructing or expanding more than 155 factories to provide clean technologies such as solar panels and electric car batteries. These factories require electricity. Electric vehicles don’t run on gasoline. Moreover, each semiconductor fabrication facility being subsidized by the CHIPS and Science Act consumes as much energy as a medium-sized town.

The Biden administration is further spending $7 billion in subsidies for green hydrogen. Scientists say the world cannot go fully green without green hydrogen, but the Biden administration is making no provision for the power required to produce green H2. A green hydrogen economy would require a fourfold increase in onshore wind power, or a twelvefold increase in offshore wind, or an eightfold increase in solar power utilities. 

That will not happen in the U.S. because permitting reform is not politically feasible. It requires a decade or longer to build a new electricity transmission system. Put simply, politics makes it impossible for the U.S. to supply the electricity necessary for a green hydrogen economy. In turn, some local economies will successfully transition to an AI world with a low carbon footprint. But many local economies will not. Jurisdictions that welcome natural gas facilities and nuclear power plants will succeed.

CLICK HERE TO READ MORE FROM RESTORING AMERICA

North Carolina is ahead of the game. Duke Energy powers the state economy. Duke, on Jan. 31, filed to construct a new natural gas plant and to build three small modular nuclear reactors, and Duke proposes to add more solar and wind power. North Carolina will have a dynamic economy.

Still, the basic point remains: to meet the large and unexpected increase in demand for electricity, a combination of natural gas power, nuclear power, and some green energy power will be required. The public demands economic growth and economic prosperity. A completely green energy economy is a fantasy promoted by the progressive Left, who are clueless about economics and the “wants” of the public.