The Spanish government has announced it is halting subsidies for renewable energy projects. Once held up by U.S. President Barack Obama as a role model for the U.S. energy economy, Spain says it can no longer afford to dump money into renewable energy projects that are not providing reliable energy and are not living up to economic promises.
“What is today an energy problem could become a financial problem,” said Industry Minister Jose Manuel Soria in a press statement.
Spain’s unemployment rate reached 22.8 percent in January 2012, more than double what it was in 2005 when Spain began its far-reaching renewable energy initiative.
“Will America watch as the clean energy jobs and industries of the future flourish in places like Spain?” Obama asked in a 2009 speech on renewable energy.
Spain’s renewable energy economic woes do not come as a surprise to economic observers. Juan Carlos University published an economic study in 2009 showing Spain’s renewable energy initiative killed 2.2 jobs for every 1 job it created.
Higher Prices Kill Jobs
“Wind and solar power are less reliable and substantially more expensive than conventional energy,” said Heartland Institute science director Jay Lehr. “Common sense dictates that you don’t grow the economy by forcing people to pay higher prices for the same goods and services they buy at inexpensive prices today.
“While renewable energy projects may create a small number of jobs, far more jobs are destroyed elsewhere in the economy when higher energy prices mean people have less money to spend on other goods and services, such as food, clothing, housing, education, and durable consumer goods. This is the Economics 101 lesson that renewable energy activists seem incapable of learning,” Lehr added.
James M. Taylor ([email protected]) is managing editor of Environment & Climate News.