The Force That Through The Green Fuse Drives Inflation

As soon as Charlie said it, I kicked myself for not having made the direct connection. Green energy is producing inflation. How could it not? Put aside the benefits. If you build a new wind farm it will cost more than maintaining an existing oil rig.

As the lubricant of cheap money is slowing down, the inflationary aspects of the green energy transition are finally showing up at the local gas pump. The cheap money is the only part that is “transitory”

The basics…

If you produce and consume electric energy less efficiently than chemical energy it will be more expensive.

If you store energy in expensive commodities (batteries) instead of using them as is (gas) it will be more expensive.

If you drill and explore for less oil, oil will become more expensive which, while not directly affecting the price of electricity produced by solar (which includes wind), raises total energy costs.

For years, these facts have been pointed out. Those who warned of the mounting future cost of inefficient energy were rebuffed. Green energy development seemed to be paying itself off — until now.

It took my friend Charlie to cut through all the complexity and state the simple direct truth.

It makes me even more certain we’re heading to inequalities and suffering that will be the force that through the green fuse that drives future wars.

There are many theories about what started WW II. But I believe most historians agree that energy insecurity was one of the big factors fueling the war’s expansion. Those who didn’t have cheap energy (Germany and Japan) didn’t want to remain economic slaves to those who did.