Renewable OPEC: Careful What You Wish For

Not that I'm concerned that Europe is on the right track with respect to producing a majority (if not all) of their energy needs in the future with renewable energy (RE), but this opinion piece from the Wall Street Journal brings up an interesting conundrum. I've heard before (and even blogged about it) that African deserts can provide more than enough solar energy to provide Europe with their electricity needs. When I first heard this, my altruistic (albeit naive) nature immediately leaped to the conclusion that any nation that had better means to produce various forms of RE would provide that energy to other nations at a lower cost, rather than allowing market forces to take over and adjust the price. Silly, silly me. I forgot to put into the equation the world's warm and fuzzy embrace of capitalism.

So, the conundrum is that Europe can only produce so much of their energy consumption with RE. If Europe wants to stay true to their carbon reduction commitments, then they will have to purchase the rest of their energy needs from "renewable energy" producing nations such as Algeria (mentioned in the op-ed); nations that have the best means to produce solar generated power. It also brings to mind that the transmission of this "desert solar power" will have to tie into Europe's electricity grid. That means that Europe would hypothetically be at the mercy of a cartel of RE producing nations (like the Organization of the Petroleum Exporting Countries, i.e. OPEC, is with petroleum consuming nations today). In other words, these RE producing nations, like OPEC today, could hold Europe's collective energy fate in their hands (in the form of price fluctuations and even transmission "issues"). I'm not suggesting that future renewable energy producing nations would hold Europe hostage, but I am saying that the ability for all nations to be completely self-sufficient with respect to their energy production and consumption would be difficult if production is concentrated in the hands of a few nations, like what happens under OPEC. As an example today, if OPEC sneezes then the world's oil markets shiver. If anything the idea of a "Renewable OPEC," in light of what happens with the petroleum OPEC, certainly brings up some interesting, eerily familiar geopolitical ramifications for the future of RE production and consumption.