Tuesday, June 2, 2009

The Green Journey in Spain

President Obama has said that he wants to emulate the green model used in Spain.

At the Climate Change Conference, Gabriel Calzada, professor of economics at King Juan Carlos University in Spain, gave an overview of the Green Journey in Spain.

He told the conference it starts with Green Subsidies (What I call advance bailouts).

For windpower, the subsidies are in the range of 80% to 90% over market power prices.

For solar power, the subsidies are in the 475% range over market power prices.

He told us, companies with these subsidies were earning rates of return in the 12% to 20% range. He said this led to Green Lines, as more and more companies and individuals wanted to gain licenses to get in on the subsidies and returns.

This he said then led to Green Corruption. Because the lines were so long to get licenses, people paid bureaucrats to get to the head of the line.

But, overall it was raining Green (as in $$$), which led to a Green Bubble. Since most of the early money went to those constructing the green facilities, to keep them employed, more and more green facilities had to be built.

It has all ended in what Calzada says has been a Green Bust, with rising unemployment and not enough money for all the ongoing Green projects.

1 comment:

  1. Woah, with all those funky espanol names and proximity to President Obama, I first read this and thought the king of Spain advised the king of America that green energy will cause an economic bust!

    But that sounded too sensible to me and then I realized that a Spaniard gave a lecture on the shortcomings of the green economy in Spain, at a university named after a dead monarch tyrant, and that the implication is that PRESIDENT Obama should take heed due to his own expressed interest in just such an economy.

    Now that's a topsy-turvy reality I can wrap my head around!