Green Energy Still Far Off

The official version of reality is that we are running out of what we know as fossil fuels. So gas and coal are going to become more expensive so that it becomes worthwhile to get our energy from other sources, like wind and solar. So all one needs to do is stop investing in oil and start investing in alternative energy. In the case of automobiles, it is time to ramp up production electric cars or at least hybrids because someday gas will be unaffordable.

There is, however, a problem with this theory. How many times in our history has the government had the insight to produce a new product or service that transformed our lives? Did the government plan and produce the electric light bulb? Did they invent the automobile? Or the airplane?

No, in all these cases and many more, private individuals devoted time and energy and sacrificed in other ways for a vision of what the future could be.

So the government’s push to get us all to “go green” in how we drive our cars comes with no guarantee of success. And in fact, it seems the government’s guess about the future was nothing more than a guess. In this case it was wrong.

From MarketWatch: “Electric, hybrid cars stall as new-car sales surge.”

Auto makers’ efforts to put more electric vehicles on the road appears to be shorting out.

Despite a booming U.S. auto market, sales of electric and hybrid cars have stalled this year, capturing 3.6% of the market through August, slightly down from last year’s 3.7% share, says research firm Edmunds.com.

The leveling off comes as surprise. Many auto industry executives and analysts predicted that hybrid and electric car sales would continue to grow incrementally as car makers expanded new offerings and public awareness increased.

In 2011, the Obama administration put forth the lofty goal of putting one million electric vehicles on the road by 2015. Last year, a total of 581,240 electric and hybrid cars were sold in the U.S., said Edmunds.com.

“As the summer months wind down, we’re approaching the time of the year when sales of these vehicles tend to be slower, so a late-year surge isn’t very likely,” said Jessica Caldwell, an Edmunds.com analyst.

For many major car makers, sales volumes are declining as gas prices stabilize and more U.S. buyers return to buying large cars and sport-utility vehicles.

Even if “peak oil” is true, it is easy to make an investment decision prematurely. Right now, it is still more efficient to use the relatively cheap energy from oil than it is to try to use other forms of energy.

[See also, “Europe Learns that Green Energy is an Economic Drain.”]

The government is not God; it cannot predict the future.