News Cycle Contradicts Green Energy Revolution
Last Thursday, The Wall Street Journal’s Jeff Bennet and Christina Rogers reported that auto dealers “are telling auto makers to limit production of passenger cars in the face of overwhelming demand for trucks and sport-utility vehicles.” They quote Earl Hesterberg, chief executive of Group 1 Automotive Inc., the nation’s third-largest new-car chain by vehicle sales, as saying that “virtually all retailers … have been communicating that ‘you know, we don’t have enough trucks and SUVs.’” Indeed, the demand imbalance between small and large cars is so great that dealers are asking car manufacturers to alter their production targets in order to make more big cars and trucks.
By buying big cars in droves, American consumers are acting in blatant contravention of President Obama’s admonishments to the contrary. A year ago, in an interview with The Detroit News, the president warned that Americans flocking to SUVs were making a big mistake, because gas prices would soon increase again.* His overall point was to goad American motorists into buying smaller cars and electric vehicles that better comport with his administration’s fuel efficiency standards and climate rules. And yet, despite the president’s protestations, Americans continue to buy big cars, climate be damned. This lends further anecdotal evidence to the polls indicating that Americans do not care about global warming, which I discussed last week.
The other important green energy story from last week was a New York Times profile of SolarCity, one of the largest providers of rooftop solar panel services, by reporters Diane Cardwell and Julie Creswell. The article is notable primarily for its inclusion of a refreshingly honest quote from Lyndon Rive, SolarCity’s “brash and optimistic chief executive.” According to Rive, his product “makes no financial sense for a consumer” without subsidies and mandates. What a candid concession!
I’ll conclude this blog post with a flurry of other green energy news, written in newswire format: Abengoa, the global renewable energy giant, teeters near bankruptcy after government handouts were curtailed in Europe … Abengoa was a co-developer of a first-of-its-kind concentrated solar power plant in southern California, the Ivanpah “power tower,” whose underperformance currently jeopardizes its long term contract on which the project’s continued viability is dependent … Ivanpah received a $1.6 billion loan guarantee from the Department of Energy, so if it loses its contract, the American taxpayer stands to lose big … The other primary co-developer of the Ivanpah plant is NRG Energy, which in December fired its CEO David Crane, in a move widely perceived as a rebuke of Crane’s unprofitable foray into clean energy … During the whole of 2015, not a single wind turbine was installed in Spain in the wake of a government rollback of subsidies …
*Though the perspective on oil prices Obama lent to the Detroit News is only one of many he has adopted during his administration.