| Message |
standpoint, I don't know of any recent substantial European advances in electricity production. (Anybody, please free to educate me.) Now there are a couple of European nations missing from that chart (Germany and Austria, perhaps others), but it makes clear that Europe, generally, is paying far more for its electricity than the U.S. Why does this electricity price differential matter? Here are a couple of reasons. First, two thirds of electricity produced in the U.S. is used in commerce and industry, in other words, business applications. The more business pays for it, the more our goods and services cost. The other third is used in homes. The more electricity costs, the more it costs to heat, cool and light our homes. This reveals that the cost of electricity and our standard of living are inversely related. The more electricity costs (from imitating Europe, e.g.), the more expensive everything is and, therefore, the lower our standard of living. Second, energy is one of the major costs in industrial production, of which electricity is a major component. In international sales of physical goods, transportation is another major cost. Because the U.S. is one of the largest markets (and with foreign labor costs on the rise), if the U.S. had one of the world's lowest energy costs , manufacturers would relocate here to take advantage of the cheap energy and avoid the cost of international shipping. You'll note on the chart that France is the loan European country with relatively cheap electricity. 75% of France's electricity is nuclear, and they export a significant amount of electrical power. However, the new president, Hollande, has pledged to reduce their dependence on nuclear power in favor of renewables. So that low cost may disappear if France adopts "European advances" in electricity production.
Chance favors the informed
|
 |
| Follow Ups |
|
|
