Today, President Obama is meeting with the Danish Prime Minister Helle Thorning-Schmidt to discuss, among other things, “green growth, and economic development.” This is a good reminder that President Obama would like the U.S. to emulate Denmark’s incredibly expensive energy policies.
On multiple occasions, President Obama has cited Denmark’s energy policy as a model for the United States. This is in line with President Obama’s statement that “under my plan . . . electricity prices would necessarily skyrocket.” After all, residential electricity prices in Denmark are the highest in Europe—41.2 cents (€ 0.3078) per kWh compared to 11.82 cents per kWh in the U.S.
One of the main drivers of Denmark’s high residential electricity prices is their promotion of wind power. To evaluate claims by President Obama that Denmark is a good model for a “green” economy, IER commission a study to example the true impacts of Denmark’s promotion of wind power. Here’s what the researchers found:
The findings of this study cast serious doubt on the accuracy of the statement that Danes satisfy “20 percent of their electricity through wind power.” The report finds that in 2006 scarcely five percent of the nation’s electricity demand was met by wind. And over the past five years, the average is less than 10 percent — despite Denmark having ‘carpeted’ its land with the machines.
- Subsidies. Government subsidy of wind producers over the past decade amounts to roughly $376 million per year. As the decade has advanced, the rate of new building in Denmark has declined sharply — and to maintain their sales, just as in Spain, manufacturers have been forced to concentrate on exporting their technology to foreign markets (USA) where the subsidy potential is higher.
- Employment. The public subsidy in Denmark per wind-related job created is 600,000-900,000 DKK per year ($90,000-$140,000 USD). This subsidy constitutes 175-250 percent of the average pay per worker in the Danish manufacturing industry.
- Electricity rates. Thanks to a combination of expensive base power, taxes and additional charges, Danes pay more for their electricity than anyone in the European Union.
- Emissions. The wind power exported from Denmark saves neither fossil fuel consumption nor CO2 emissions in Denmark, where it is all paid for. By necessity, wind power exported to Norway and Sweden supplants largely carbon neutral electricity in the Nordic countries. No coal is used, nor will you find power-related CO2 emissions in Sweden and Norway.
- Exports. Over the last eight years West Denmark has exported (couldn’t use), on average, 57 percent of the wind power it generated and East Denmark an average of 45 percent. Denmark sells this power to its neighbors at almost no cost, asking only that its neighbors sell some of their baseload power back to Denmark on the frequent occasions in which the wind does not blow there.
Electricity prices are already skyrocketing in the United States without more Danish-style policies, but President Obama is continuing his push to increase the cost of electricity through a new “clean energy standard.” There is no need to follow Denmark’s lead on driving up electricity prices. Enough is enough.