Houston Republic

Renewable energy is the cheapest form of energy compared to coal and gas as the cost of wind fell 50%, and solar by 85%, in the past 10 years, Bloomberg reports.

But an expert says the cost myth is untrue.

“The wind is not always blowing, the sun is not always shining and it's irresponsible to believe that simply going to a 100% renewable strategy to provide electricity for the greater good of society is even possible,” University of Houston Energy Center Officer of the Center for Carbon Management and Energy Sustainability Charles McConnell said. “Forget about what it would cost because the costs would be enormous battery storage.”

CCME Energy Center Officer Charles McConnell | University of Houston Center for Carbon Management in Energy

McConnell, who served as the Assistant Secretary of Energy in the U.S. Department of Energy from 2011 to 2013, further states that if renewable energy is truly cheaper than coal and gas, it wouldn’t need subsidies.

“Subsidies are required and so the political support for these subsidies standing on their own in full disclosure and full transparency would have been a far more difficult conversation and successful conversation for those that wish to continue those services,” he said.

In fact, a renewable energy subsidy was included in the Coronavirus Response and Relief Supplemental Appropriations Act of 2021, which expands federal tax credits to inspire the development of wind and solar power projects along with tax credits for energy efficiency, such as carbon capture, fuel cells, biofuels and alternative fuels, according to Forbes.

“Throwing it into COVID relief is another example of political jujitsu and it was pretty effective because who doesn't want COVID relief?” McConnell told the Houston Republic. “But you have a tremendous amount of the political will behind COVID relief also wanting subsidies carried along with it, and it got treated that way.”

Renewable energy is cost-inefficient to the point that it requires government support, McConnell alleges, because it's supported by an artificial policy background, which includes market structure. 

“The investment community and the lobby behind the renewable energy technologies of solar and wind all recognize that it's not a compelling investment choice to build more renewables unless you have the incredibly strong support of policies, subsidies and market structure that makes their offering more favorable,” McConnell said in an interview. “It tips the scale.”

As previously reported, wind developers sell electricity at marginal costs to gain market share, while subsidies typically cover one-third of the wholesale price, and wind subsidies hurt conventional power sources that don't receive the same tax credit.

For example, generators Panda Temple Power, Energy Future Holdings and Exelon Generation Texas Power have filed for bankruptcy, according to Bill Peacock’s "Wind Subsidies and 'Predatory Pricing' in Texas," because they receive a better return due to subsidies regardless of the cost at which renewable generators sell electricity.

“People who are using natural gas, coal, or even nuclear power are put on a second-tier where they have to wait for all the renewable energy to be sold or be consumed, and only then do they get to bid in because now it's their turn,” McConnell said. “The problem with that is it has a destructive effect on people's ability to continue to build baseload power generation and that’s something everybody knows we all need and which we rely on.”