Ok, some things are just funny. People have heard me use “Greener” as we are never going 100% away from fossil fuels. It is however not optional that we migrate to renewables, it is just when, and at what cost. We will get into the cost and investment side in our next article. COP26 begrudgingly … Continue reading “Austria’s “Greener” policies are just funny no matter who you are, and show that there is a direct relationship between renewable energy and inflation.”
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January 19, 2022
Ok, some things are just funny. People have heard me use “Greener” as we are never going 100% away from fossil fuels. It is however not optional that we migrate to renewables, it is just when, and at what cost. We will get into the cost and investment side in our next article.
COP26 begrudgingly declared that natural gas and nuclear are now considered “renewable” and are eligible for renewable funding. This is a fundamental change in the “Greener” story as the admission that they need the two energy sources to get to renewable nirvana was extremely hard to admit. In fact, it was so hard to admit, most people missed those little words buried in the meeting summary.
Austria got the word several months later that the EU was adopting new rules and did not want to follow along and use either power source. Here is where it gets extremely funny.
Leonore Gewessler Photographer: Helmut Fohringer/AFP via Getty Images
“Neither of these two forms of energy is sustainable and therefore has no place in the taxonomy regulation,” Environment Minister Leonore Gewessler told AFP in an interview this week in her eighth-floor office overlooking the Danube canal that flows through central Vienna.
“If the Commission continues to work with this proposal and implements it then it is clear that we will take legal action,” the Green politician added.
“Whatever is labeled green, whatever is labeled sustainable must also actually contain green and sustainable investments,” she said, adding renewable energy was “cheaper, more readily available and a safer and better alternative to nuclear energy”.
Austria only has one nuclear power plant that was built in 1978 and never produced electricity until 2009 by using solar panels. The reactor has only been used as a training facility for international nuclear engineers. The real irony is that Austria was considered the leader in renewable energy in 2011, and have fallen off to the bottom of the chart in 2021.
There is no questioning that Germany took the lead on the move to renewable energy, and now has the highest household electricity prices in the world.
There are several matrices that are aligning in the world and there is an undeniable relationship between renewable energy and the health of a countries economy, and subsequentially the wellbeing of its citizens.
High inflation rates – Higher renewable energy sources as a percentage
High electricity prices – Higher renewable energy sources as a percentage
High growth in GDP – Lower renewable energy sources as a percentage
We are also seeing that energy-exporting countries like Saudi Arabia with oil, and France with nuclear electricity exports will have lower inflation rates. France has been exporting the electricity generated from its nuclear fleet to neighboring countries at considerably cheaper rates than other forms of energy.
The Bottom Line
The poor energy policies of the world not only impact all their citizens through the higher price of electricity, and totally disrupts the financial markets across all industries. These energy policy decisions have resulted in higher inflation rates and less disposable income. However, the positive side is the ability for people with cash resources to expand their wealth through proper investing in commodities.
As always check with your CPA if alternative investments are good for your portfolio Take the assessment and see if it is right for you HERE.
Please reach out to our team at any time for answers to your questions.
Jay R. Young, CEO, King Operating
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