The Unseen Costs of Green Energy: Could Spain’s Blackout Become a Warning for America?

Those who don't get on board and recognize that the Green New Deal, or the Green Deal as it's called in Europe, was a war deal, it was a disastrous deal, and governments who are still wedded to the antiquated agenda of saving the world from a non-existent climate crisis, and the people under those governments are going to suffer egregiously. Today, on Bay Area Innovators, we sit down with Dr. Barnard Cohen, a veteran policy analyst with decades of insight into energy, the environment, and U.S.-China relations. From his research on failed post-war diplomacy, to how China quietly profited from the green energy push, Dr. Cohen pulls back the curtain on global power plays. He breaks down why energy policy is national security, and how tariffs could reshape the world order. This is Bay Area Innovators, and I'm your host, Steve Espas. Barnard, welcome to our program. Well, thank you very much for having me. Thank you so much for being here. So I will start with green energy. You've been an expert on energy for many years. I looked at a report that's been $2 trillion last year that's being invested into new technologies for green energy. And I want to kind of get your take, where are we with green energy? It's been decades that we've put a lot of effort into it, and what are the results so far, and where are we going with it? I think we have reached a stage where we can safely say that we have reached peak energy, rather peak green energy, or let's just say peak green. Turn the clock back just a few years, and green energy was all the rage. It was lavishly funded by the United States, the European Union, Japan, and other major countries. It was seen as the future. We were told that we were in the midst of an exciting transition away from climate-warming fossil fuels on the way to clean energy. Well, times have changed. They have changed radically. The conventional wisdom of three, four, five years ago, or for that matter, the conventional wisdom of just two years ago, has been overtaken by reality. What is that reality? Well, first of all, people have noticed something. You cannot power a modern economy, a full-time economy, on part-time energy. What is green energy? Well, in today's world, it is primarily wind and solar power, both of which are intermittent, both of which cause enormous difficulties with grids all over the world, owing to their intermittent nature and the inability of wind power and solar power to adjust when there is a sudden interruption to the grid. Fossil fuels, nuclear, they can make that adjustment. Wind and solar cannot. Indeed, that is exactly what we recently saw happen in Spain, when all of a sudden, out of the blue, in the middle of the day, the electricity went out. By the way, not just in Spain, but also in Portugal, where you have a disproportionate amount of solar power feeding the grid. That blackout, which was everything, it was ATMs, it was electricity at home, you name it, it went out. That was, to use a tired expression, but it was a wake-up call, because that was a preview of coming attractions. Those are the kinds of problems that grids all over the world are already having, and will have even more, the more they are dependent on intermittent wind and solar for their electricity. That is the first recognition, along with the fact that these green energies, the ones we just referred to, are heavily subsidized by taxpayers all over the world. And yet we find, to our horror, never mind that a lot of people warned about this for a long, long time, that this green energy would never be able to meet our growing needs for electricity. Do you see it now as a peak, as you said? Do you expect that this huge investment into green energy is going to start to slow down? Oh, yes. In fact, it is already slowing down in the United States. See the steps that President Trump has taken to de-emphasize green energy. He absolutely hates offshore wind, of which he has made no secret, and he is absolutely determined to end the taxpayer subsidies for green energy, as well as the purchase of electric vehicles. Europe, which is much further along the so-called green transition than the United States, is also waking up, albeit much more slowly. There too is a recognition, albeit a very grudging recognition, that the path that they started going down years ago, by blanketing the continent in wind turbines and solar powers, has led to Europe being increasingly less competitive in its industries, in its automobile manufacturing, and it has led to a tremendous spike in the cost of electricity. That's electricity to energy, but it's also electricity to ordinary citizens. So something that global elites, be they in the United States or in Europe or elsewhere, imposed on ordinary people, people are now recognizing that this was an enormous mistake, one which has cost Europe dearly, and would have cost the United States dearly, and to a certain extent was already doing so, until we had a change of administrations in January, and the United States is now moving away from this at a pace that you could have imagined possible only a few short months ago. There's one other factor driving this, and this was the black swan for green energy. What was that black swan? It's called artificial intelligence. Artificial intelligence, which is going to change the way, well, it's going to change our lives, and indeed, it's already doing so immensely. But AI requires an enormous amount of energy to be produced at data centers, of which there are already over 3,000 in the United States, with hundreds more planned. Data centers are also shooting up everywhere from Singapore to Japan to Malaysia to Europe, you name it. Why? Because the countries must remain competitive in AI. If they are not, then AI will be dominated by the People's Republic of China. There are plenty of people in the US and even in Europe who recognize this, and you cannot power data centers on intermittent energy. Even the powers that be in Silicon Valley, who for years and years praised their commitment to a cleaner and healthier climate by boasting of their commitment to wind and solar, are now turning their backs on wind and solar, embracing natural gas, nuclear power, and even coal power, because they need this for their data centers. So, as I said, the green transition has derailed. It has derailed disastrously for the greens in the United States. Europe, as is its worth, will be slower to recognize the mistake that their political elites made, but they really have no choice, because they cannot meet their energy needs, stay competitive, and be able to provide their population with a decent standard of living if they are dependent on wind and solar for their power. And, like you said, Spain was an example. Just last week, there was a wake-up call. Now, my next question is, who has benefited the most from the green energy effort, the infrastructure, and the investment that's been made over the years? This Bay Area Innovators episode is sponsored by Peter Cassara Claudius, an Italian menswear store that brings timeless European style with a modern edge to Sunnyvale and the Bay Area for over 50 years. From top Italian suits and shoes with exclusive Tami Bahama line, they've got your look covered. Check out their website at petercassaraclaudius.com to find out more. And now, back to our interview. Okay, first and foremost, we'll do the easy one first and then the complicated one. The easy one, obviously, the purveyors of various green energy, whether it's the people, the developers of wind, so-called wind farms, solar farms, the manufacturers of electric vehicles. For them, this was a gravy train. They received the subsidies. Their industries were artificially propped up, courtesy of taxpayers, be they American taxpayers, British taxpayers, German taxpayers, you name it. These were, shall we say, in each country, the domestic beneficiaries of the green transition. For example, if you were to buy an electric car, you would get a rebate Oh, yes, yes. If you qualify in the United States, for example, under the so-called Inflation Reduction Act of 2022, signed into law by President Biden, if you qualify, you could get a rebate for your electric vehicle of up to $7,500. So, for the manufacturers, they said, look, we get money, we get subsidies, and in the United States, particularly under the Biden administration, they not only were the beneficiaries of lavish subsidies, but also out-and-out gifts, not loans, but grants. The company Rivian, this is a California manufacturer of electric trucks. It's been in existence since 2009. In the final year of the Biden administration, a few months before it left office, Rivian received a $6.6 billion grant from the Biden Department of Energy. This was not a loan, it was a grant. A grant is a nice term for gift. So, $6.6 billion for a company that is struggling because there's no real market for the vehicles it's producing is a lot of money. It will keep them afloat for, pick another two, three, four years, who knows. But those were the kinds of goodies that were being passed out to politically well-connected purveyors of green energy. Ah, but let's go to the international area. And there, it's an entirely different story. There, there was a great beneficiary of green policies or green transition. And that country was none other than the People's Republic of China, which has a virtual stranglehold on the materials that go into wind turbines, solar power, and the batteries that power EVs. It's not that these things, the raw materials are necessarily produced in China, but the Chinese have invested in Central Africa and Latin America and elsewhere. They control the supply chain and they benefited immensely from the unilateral disarmament, in this case, economic, but slash geopolitical disarmament that the United States engaged in along with its European allies when they attempted the transition to green energy because they moved away, particularly the U.S. The U.S. is the world's largest producer of oil. It is the world's largest producer of natural gas. So what did the Biden administration decide to do? Turn our backs on fossil fuels and embrace wind and solar power. The global supply chain for which is largely under the control of the Communist Party of China. So the United States threw crap through all sorts of innovative technologies that were used to extract more oil and more natural gas at a lower cost and with a much smaller environmental footprint. Under Biden, the U.S. turned its back on that to embrace intermittent energy, which is largely benefiting the People's Republic of China. Now Trump has reversed that. And now this is very interesting when you look at China's position here. Beijing made a very smart move for a number of years. Things really worked out well for them. They must have been astounded to see their chief deal strategic rival, the United States, engage in this kind of economic disarmament, which it undertook under Biden, turning away from fossil fuels, which it has in abundance, and embracing an energy source, which is largely under the control of the Chinese. I can see Xi Jinping and his colleagues sitting around in a room somewhere in Beijing and asking themselves, what are they thinking? Well, the bet worked out for several years. What will be fascinating to watch now is that that bet could well lead in the exact opposite direction. The U.S. is turning its back on this. The big deals that the Chinese had counted on making with the U.S. and other countries are now in serious jeopardy, completely independently of the tariffs, which are a separate issue altogether. But here, the U.S. is moving away and moving away very rapidly from energy sources and the raw materials that go into those energy sources, which are produced by China. So I think the Chinese are ultimately here, short term, a very good bet. Long term, what they offer in the sphere of energy is something that a growing number of countries no longer want. Now, China, correct me if I'm wrong, but China produces the raw materials that go into the batteries, the solar panels and all of these things. Yes, they produce them not necessarily in China proper. As I said, they source them from all over the world. But they're very, very clever in that they process most of those in China. So once they have the raw materials, those raw materials have to be processed. And that's where they wind up in wind turbines and solar powers and batteries and what have you. So they have a kind of a vertical system where they controlled the companies that extracted the minerals that they needed and the other raw materials, and then they processed them in China and then sold them to the rest of the world. It was a very clever business plan that worked for quite a number of years. But I think those days are now over. Does China itself embrace the green energy program that the U.S. and Europe? Only partially. There are a couple of things here. China does have solar power. It does have wind power. But the Chinese also are constructing coal-powered plants by the hundreds, simply because they recognize the importance of having what's called baseline energy, things that are available 24-7, 365, and are not in any way dependent on the weather. So they have diversified their own domestic sources of energy, but their big emphasis has been on coal. China property, owing to unfavorable geology, doesn't have very much natural gas or, for that matter, oil, which explains on the latter one of the reasons why they have been so active in developing EVs, electric vehicles, because China simply doesn't have the oil itself and has to import from Russia, Iran, and elsewhere. It also explains China's interest in the South China Sea, which is said by petroleum geologists to have a great deal of oil and natural gas. But yes, they diversified the economy, but they developed green energy to sell other people, not to become a major source of their own industry simply because they had better sense. There's another reason for that. Under the international agreements, the most recent of which is the Paris Climate Accord from December 2015, industrialized countries are committed to reducing their emissions of greenhouse gases by a certain amount by 2045 or 2050. It's a sliding scale. China is considered by the United Nations, the people who put on these various climate conferences, to be a developing country and is thus not required to make the kinds of sacrifices to which governments in the US and Europe and Japan and elsewhere committed themselves. So the Chinese got a free ride. They supply the green goodies, the wind turbines and the solar powers, but they themselves don't have to make the kinds of sacrifices and have absolutely no intention whatsoever of making them. So there's a different standard for the pollution or for the CO2 or whatever they can produce. Now, can you please explain to us, how can China be considered a developing nation when it's a second largest economy and it's in many ways? Yeah, it's patently absurd. But the United Nations, in its infinite wisdom, has never updated China's status so that it complies with today's realities. 25, 30, 35 years ago, China was legitimately a developing country. That hasn't been the case in a couple of decades. It is a major industrial power. As you pointed out, it's the world's second largest economy. So it should be treated as such, but it is not. So the Chinese have gotten a free ride for an awfully long time. I know of no plans on the part of the United Nations to change China's status at all. And the Chinese are certainly not going to ask the UN to change its status because they benefit too much from the status quo, even though that status quo has absolutely nothing to do with reality. Just this morning, I had a report about academic espionage by China at Stanford University here in California, a major university worldwide. But what was more interesting was that, according to the report, China invested $64 million, or they call it grants or donations, $64 million to Stanford. So Stanford is probably one of the richest universities in the US, and they get a donation or a grant from Chinese donors of $64 million, of which they're anonymous. We don't know their names. So for a developing country to make that kind of donation, not to mention many others, it seems very unusual. And that makes it difficult to investigate further because people are afraid to talk, to investigate further the academic espionage. So can you tell us, are you familiar with the process that the UN uses to update the status of other countries' status? Actually, currently, there's really no process at all. It has been known for years and years that China is a major industrialized country. It has high-tech facilities. It's trying to become the world's leader in artificial intelligence. It's a major exporter. It hasn't been a developing country in decades. So when you ask, well, what is the UN doing to update its consideration of what China is and update its ranking of China, and for that matter, any other developing country, India comes to mind, there are others, to take into consideration the strides that these countries have made over the past several years. The answer is absolutely nothing has happened, and I see no indication that it will any time soon. I'd like to talk about ESG. What is ESG investing? ESG stands for environmental, social, and governance. ESG investing may also be known as sustainable investing or socially responsible investing. It's a way of investing in companies based on their commitment to one or more ESG factors. For example, ESG investors might consider factors like greenhouse gas emissions, diversity and equal employment, and the leadership of the company. Can you please tell us how these standards are related to China and to energy? ESG, a once very fashionable investment policy in the United States and elsewhere, at one point over 45 banks around the world were enthusiastic participants in a United Nations-sponsored investment strategy that would have denied to developing countries funds if those developing countries were not engaged in the rapid energy transition that they should have been engaged in so that they too could enjoy the boundless benefits of the transition to green energy. Well, that was part of a larger mosaic that saw Wall Street asset managers putting together green funds, ESG standing for environmental, social, and governance. This was at a time when not just the green agenda, we can say the woke agenda was at its height. And people were told by investment advisors, put your money in this fund, you will ride the wave of the future, help secure your retirement, and make your life infinitely more comfortable. And by the way, in the process, you'll make the world a cleaner and better place to live. Well, it turns out that that had absolutely no basis in reality on the contrary. Green funds, ESG funds, consistently underperformed other funds. It got so bad that many states in the United States, particularly oil and natural gas producing states, started pulling their funds for the pensions for the state employees away from ESG funds, saying, no, we will not be a part of this because we have a fiduciary responsibility to the people making their contributions into their pensions for their retirements. And investing money in money losing ESG companies is not the way we want to go. So what has happened over the past year, year and a half, is that there has been a rush away from ESG companies. As a matter of fact, the term has fallen completely out of favor, and is yet another indication that we are now in the era of, and moving very quickly beyond peak green, because the whole green agenda has shown itself to be a dead end, a dead end for ordinary people, a dead end for investors, and a dead end for countries lavishing vast sums of their taxpayers' money on these various green projects, almost all of which turned out to be dead ends. Just to clarify, what exactly would the ESG policy do to a company? It would force them to follow these green energy regulations, is that what it is? Some companies, yeah, some companies are eager to be included on an ESG investment portfolio would say, we are doing X, Y and Z, we're reducing our environmental footprint, we are lowering our emissions, and they would do this on their own. Whether their claims had any basis in reality is quite something else. The companies themselves, however, were mostly created to be green companies. And at their creation, the people behind these companies sincerely believed that they would make out like bandits, that they would receive the subsidies and the grants, and that they would ride the train to prosperity that the green agenda was part of. Many of those companies, however, found out that they couldn't make any money. A lot of them went belly up, their stock price plummeted, and as their stock price plummeted, so too did the dividends that ESG companies were supposed to pay out. And once it became public knowledge that ESG investments were a bad place to put your money, ordinary investors started pulling their funds out, along with institutional investors, as well as state pension funds, and ESG is now going up very rapidly in smoke. Thank you for explaining that. Now I want to ask you a theoretical question. If you were to have coffee with Xi Jinping, China's president and President Trump, what would be your questions to each one of them as far as energy policy? What would be the most important thing you'd want to ask them? I would ask Xi Jinping, well, what are you going to do now? You have bet on green energy. It worked out very well for you for several years, but now the party is over. And what are you going to do now? Because you're not going to be selling the materials that go into wind turbines and solar panels nearly as much in the United States as you thought you would be. In fact, your market share, your sales there are going to go down because the Trump administration is moving away from that. So what are you going to do now? Are you going to move aggressively into the South China Sea, which you may want to do for other reasons too, because it's a major shipping lane, a passageway, a tremendous amount of the world's shipping goes through the South China Sea on its way from Asia to Europe and Africa. What are you going to do? That would be one thing, because you're not going to be able to match, certainly not match the United States, simply because other than coal, you don't really have any fossil fuels in China proper. That would be my question to him. My question to President Trump would be something else, but it would be fine. Three months ago, you announced that the United States was withdrawing from the Paris Climate Accord, but you did that through an executive order. There is nothing to keep a future democratic president from issuing an executive order, doing away with your executive order and getting the United States right back into the Paris Climate Accord, which is exactly what happened eight years ago. Trump pulled out of Paris, not through an executive order, through another procedure. And what did Biden do four years later after he was elected? On his very first day in office, he declared that the United States would re-enter the Paris Climate Accord. My question to Mr. Trump would be this. Why don't you do what the Constitution requires? The Paris Climate Accord is a de facto treaty. In fact, the United Nations even refers to it as a treaty. If it is a treaty, then that treaty should be submitted to the U.S. Senate for ratification, which requires 67 votes or two-thirds of the members. The Paris Climate Accord will come nowhere near getting 67 votes. It probably wouldn't even get 50. Why don't you do that and put an end to the Paris Climate Treaty once and for all, because the treaty will have been rejected by the Senate? Oh, I see. I see. That would be the way to... That's the way to kill it once and for all. Exactly. Another question related to advice you would give to presidents. What would be your energy advice to President Trump to outmaneuver China that he's not already doing? He may already be doing it, but would you have any other advice for him? I think the other thing he should do, and he's doing a lot of the right things now. He's doing it for two reasons, to create U.S. global energy dominance. But of course, he knows full well that that's being done at the expense of China. So he's pursuing two goals here. Obviously, he's creating jobs and a tremendous amount of wealth for the United States. But he and the people around him know full well that in doing so, they are weakening China, which simply is not going to be able to keep pace with the U.S. in that regard. So that means that what they're doing now is absolutely the right thing. I think they should, in addition to what they're doing, also engage in very ambitious and aggressive permitting reform so that more natural gas pipelines can be built in the United States, more oil pipelines can be built in the United States, more LNG, liquefied natural gas export terminals, can be built in the U.S. They're doing all this, but they need to realize, I think they do, but it's something that's absolutely imperative, that without permitting reform, that means it doesn't take seven, eight, nine, ten years to complete a project. You can do it in two or three years. You need to aggressively pursue that. Not only does that create jobs in the United States very rapidly, but the quicker you do this, the better infrastructure you have, the better infrastructure you have, the more energy dominant the United States will be. They are pursuing that, but they really need to take the gloves off and recognize how absolutely imperative it is, particularly in the era of artificial intelligence, where the demand for energy is going to be so great. And of course, parallel to that, aggressive steps to update and secure the U.S. energy grid. It's very shaky. Of course, there is actually, there's not one single U.S. energy grid. There are several. All of them are rather shaky, and they need to be modernized, they need to be updated, and they need to be fed more and more with baseline energy, meaning natural gas, meaning coal. Coal is going to get a lease on life here. It's not the energy source of the future, but many coal-fired power plants in the United States are scheduled to be shut down. Now, I believe, are not going to be shut down simply because we need the energy, and coal is available 24-7, 365, is relatively inexpensive, and can provide the kind of energy that ordinary Americans need, along with what data centers, centers of artificial intelligence absolutely require. So, in that sense, it's also a natural security problem. Also, of course, the other natural security issue, of course, the other thing is nuclear power, which the Trump administration looks at favorably. That's traditional nuclear power, your fission plants. We built one in the United States since 1978 or 79. It opened up in Georgia a little over a year ago. It functions very well. We're going to need more, and of course, we're also going to need to green light as many smaller nuclear reactors around the country as possible. Here, the permitting process is absolutely essential because the agency, the nuclear power agency that overlooks this is antiquated. It's something that DOGE needs to go into and clean out as quickly as possible, and separate these people from their habits of slowing everything down to a snail's pace so that new facilities can receive the permits that they need and get under construction as quickly as possible. So, there are things that need to be done. I think the people in the Trump administration, and this would include first and foremost, Energy Secretary Chris Wright, they recognize this, but you're going to have to change the ways of the federal bureaucracy and change it very, very quickly, which I think is also happening. This is one of the things they're doing and clearing out a lot of the dead wood that has piled up in these agencies over not just years, but decades. Streamline them as much as you can possibly streamline any agency and get as much bang for the buck as you possibly can as quickly as you can because you're in a fierce international competition with the Chinese and anything that slows you down will simply benefit them. Let me move on to tariffs a little bit. They're on everyone's mind. This very morning, there's a major trade agreement being announced between the United States and the UK. Do you see additional trade agreements that would happen with Europe? And of course, when we think of Europe, it's the European Union. Britain, of course, is not part of that. But do you see the possibility of trade agreements being made with individual countries in Europe, possibly even outside the European Union? I think both are possible. I think you're going to see trade relations and trade agreements with individual European countries. That was one of the reasons Italian Prime Minister Meloni was the very first European leader to meet with President Trump. In fact, she was at Mar-a-Lago before Trump was even sworn in. The two happened to get along very well. Yes, she was there for Italy, but she was also something of a stalking horse for the European Union because the kind of deal that the United States will work out with Italy can be replicated both across the board with different European countries, but also, if they want to think big, they could do this with the European Union's headquarters in Brussels. So I do believe that the agreement announced this morning in Britain was the first of several steps you're going to see taken. I would add that the new chancellor of Germany, Friedrich Metz, doesn't have some of the baggage that one of his predecessors, Angela Merkel, had. She and Trump did not get along, which is putting it politely. And he's a businessman, a very shrewd one. I think he will speak Trump's language. Germany has suffered egregiously as a result of its own green policies. Germany needs to turn its back on them as quickly as possible. Germany now has its own Rust Belt, and Metz and his new coalition government want to deal with that as quickly as they possibly can. So the incentives are in place. For both sides to come to an agreement, certainly the deal that was announced this morning between Washington and London is something that did not escape the attention of people elsewhere across Europe, whether they be in Paris, Brussels, Berlin, Rome, or elsewhere. You're going to see other agreements follow on to that. And believe me, Japan is going to be right behind them also. And of course, you did your PhD in Munich, Germany, so we appreciate your expertise in that area. Dr. Cohen, any final thoughts, any conclusion on where we are going with energy in the future? Yes. We're living in a transition, but it's not the transition that we were told we were going to have. We were told that we were having a transition to green energy to address the existential threat posed by human-induced climate change. Well, the latter is a very grandiose claim, but one that really is not supported by climatological observations. But it became a fashionable political agenda for a long, long time, and one which did enable an awful lot of people to line their pockets with taxpayers' money over many, many years. We are now transitioning very rapidly away from that, and the geopolitical consequences of that are going to be far-reaching. We've already mentioned the main geopolitical consequence, namely that the United States is, shall we say, in the field of energy, re-arming. We have all the abundance. We're the world's largest producer. We haven't even scratched the surface of the amount of oil and natural gas that we have. We're going to be using that as a set, not only to help ordinary people, you know, trying to feed five or six mouse in the kids' school, what have you, but there's also a geopolitical element to that. That includes national security, as you mentioned. That's right. That's right. And this transition is happening rapidly. And those who don't get on board and recognize that the Green New Deal or the Green Deal, as it's called in Europe, was a raw deal. It was a disastrous deal. And we are turning our back on that. And those who tarry, those who don't realize, when I say those, I'm talking about countries and companies, those who don't realize that the green stuff has come and gone. They need to update their thinking, recognize that they are living in a brave new world, and that new world will not be green. It's going to be quite something else. And those who take advantage of that in the private sector are going to really fare quite well. And governments who don't make that choice quickly enough and who are still wedded to the antiquated agenda of saving the world from a non-existent climate crisis, those governments and the people under those governments are going to suffer egregiously. So, as I said, things are moving very, very rapidly. Dr. Cohen, thank you so much for your time. I really appreciate it. Okay. Well, thank you. Thank you for watching another episode of Bay Area Innovators. If you enjoyed this episode and you know someone who should be on our show, please send us an email at sfbay.epoctimes.com. We would love to hear from you. Thank you and see you next week.