Title: Green Energy Industry Faces Financial Struggles and Questions Surrounding Viability
As the green energy industry grapples with financial challenges, doubts about its long-term viability are intensifying. With many groups and countries seeking support from Congress, the current state of the industry is being questioned. Ford Motor Company’s recent struggles in the electric vehicle (EV) sector serve as a prime example.
Ford’s stock experienced a significant decline of 14% in just three business days following the announcement of a higher-than-anticipated loss of $1.33 billion in its EV unit for the third quarter. This translates to an average loss of $36,000 per EV sold. The company’s market capitalization has also plummeted to $38 billion, signaling serious concerns about its ability to sustain losses of around $5 billion annually on EVs.
The cost of raw materials required for EV batteries has soared, casting doubts on the profitability of electric cars, despite the push by President Biden and California Governor Gavin Newsom. A recent study from the Texas Public Policy Foundation revealed that the average EV accrues $48,698 in subsidies and incurs $4,569 in additional charging and electricity costs over a 10-year period. This brings the total cost of an EV to $53,267, which, when compared to gasoline vehicles, appears as if the government pays an extra $16.12 per gallon for traditional internal combustion engines.
Hertz, one of the key players in the rental car industry, faced unexpected losses due to its large-scale operation of an EV fleet. Consequently, Hertz temporarily halted its acquisition of more EVs, reflecting the challenges faced by the industry.
Another area of concern is wind power, with wasteful spending on wind turbines that often remain idle. Despite extensive efforts and billions of dollars in investment, wind power still struggles to be financially self-sustainable.
Escalating temperatures and record cold spells necessitate affordable and reliable energy sources. Wind turbines fail to generate power when it is most needed, such as on extremely hot or cold days, resulting in maintenance costs that are simply too exorbitant. The inconsistency in energy supply from wind turbines can also lead to harmful spikes in the energy grid.
General Electric, which once held the title of the world’s most valuable company with a market capitalization of $601 billion, has witnessed a stark fall in value by over 80%. Its offshore wind farms, responsible for annual losses of $1 billion, have contributed to this decline.
With green energy companies grappling with mounting operating losses and rising interest rates, they are left with no choice but to seek substantial subsidies from the federal government. However, as the federal government’s funding expiration approaches in November, the liberal spending on green energy and other entitlements will face scrutiny.
As the federal deficit has doubled from $1 trillion to $2 trillion within a year, concerns about financial collapse become increasingly probable. Conservative lawmakers are emphasizing the need to reassess priorities and mitigate wasteful government spending by ending subsidies for green energy and reducing expenditures on foreign wars.
In conclusion, the green energy industry’s current financial struggles raise legitimate doubts about its long-term viability. Companies like Ford Motor Company and General Electric are grappling with significant losses, casting a shadow over the industry’s future. The mounting costs of electric vehicles and the limited profitability of wind power highlight the challenges faced by this sector. As Congress weighs its decisions on funding and subsidies, the need for a balanced and sustainable approach becomes paramount.
