subject: Why Aren't Green Energy Plans More Popular? [print this page] To many Texas homeowners, a green energy plan for your home sounds like the right thing to do. After all, green energy is clean, non-polluting, has no fuel costs, and because it's renewable, its cheaper in the long run. So, signing up for a Texas electricity plan that supports and encourages renewable energy sources, seems like the environmentally responsible, earth-friendly thing to do.
But the reality, especially in these challenging economic times, shows that not as many customers are signing up for these kind of plans as you would think. So, why aren't green energy plans more popular?
The answer is price. If you compare residential green energy plans that rely on 100% green energy, you will find that these plan prices cost more compared to those that mix green and fossil fuels. Some have a small difference of .2 cents/kWh; others as high as 1.7 cents/kWh. Now, while this might not seem like that much, the difference becomes evident on a 2000 kWh $200 bill in July when the difference could further add anywhere from $4 to $34. This additional charge reflects the cost of green energy.
So, why do green sources cost more? It's supposed to be a cheap energy source, right? Both the sun and the wind don't cost anything.
Exactly right. Green energy sources are natural processes. However, the technology to extract these energy sources costs more than what it takes for fossil fuels. Burning extracts energy from fossil fuels. Consider that photovoltaic panels directly convert sunlight into electrical energy. Currently, the average energy cost for one panel is about $2.50 per watt (low =$1.42/watt, high=$3.75). Wind turbine energy is less expensive at about 5 cents/kWh according to the American Wind Energy Association .
Meanwhile, a pound of coal supplies enough electricity to power ten 100-watt light bulbs for about an hour. That's 1,000 watts and as a commodity costs .7 cents/pound (yes, that's 7 tenths of one cent) according to EIA prices for Powder River Basin coal. Natural gas is more expensive at about 4.3 cents/kWh but is still cheaper than wind power and provides better reliability.
But this doesn't mean that green energy is too expensive. If anything, the prices of wind and solar are reaching tipping points, albeit slowly. Fossil fuel and nuclear power generators do pose serious problems. According to the National Research Center, if we factor in pollution, toxic waste, radiation, and related health costs we could all add another 3.2 cents/kWh onto our utility bill. Fossil fuel and nuclear plants also face maintenance and forced outage issues that sometimes can shut them down for 20 hours or more, requiring other plants to cover the shortfall. That's another cost we could also add onto our bill.
However, these are hidden costs from a wider world view. Most consumers do not consider them when they shop for their home Texas electricity plans.
Consumers who buy green Texas energy plans do recognize these costs and appreciate the impact that their energy choices have on the environment. They also know fully well that though they are paying more for green energy, the electrons coming down the power grid into their home to heat up their toaster are not necessarily coming from a wind turbine or solar panel array. The demand for green energy has contributed to more green renewable energy capacity being built. The EIA report data showing renewable energy industry is growing and cited they installed wind capacity grew by about 19 gigawatts (GW) from 2003 to 2008 and predicted a trend expanding to 39 GW between 2008 and 2019.
So, what are these happy few getting out of it? They value the environment and energy independence and are willing to pay extra to encourage the growth of renewable energy. In short, they are backing up their commitment by putting their money where their mouth is by signing up for a renewable energy plan.
