Al Gore, the carbon tax guy, served as the Pied Piper for 5,000 companies to go bankrupt. That’s just in Germany.
According to Reuters, at least 5,000 German solar companies went bust in 2011.
Workers in Germany‘s once booming solar energy industry face a shakeout of major proportions following declines in the price of solar panels over the past year.
Cuts in subsidies for solar energy, weaker demand for panels and fierce competition from cheaper Asian rivals are eating into what was once the world’s biggest hub for the production of solar cells, taking the shine off an industry that was effectively born in Germany.
This should come as no surprise. Government subsidies are the foundation of most solar panel technology. There are a few uses, such as off-grid small homesteads in the American Southwest, but not in northern climates.
It’s not just the solar panel cottage industry.
Something similar is happening to the European carbon trading industry. In November last year, you’ll gleefully recall, the US Chicago Carbon Trading Exchange (CCX) collapsed when, in the space of two years, the carbon dioxide price fell from $7 a tonne to 7 cents a tonne. And where the US leads, Europe follows.
The insiders who were going to make a killing selling government permits to use carbon got killed. The Kyoto accords die next year. Climategate in 2009 kept them from being extended this year.
In early January, investors in the continent’s cap-and-trade system still had to pay some euro14 ($18.30) for the right to emit one ton of carbon dioxide into the air. By last week, the price of one emission allowance had tumbled to a meager euro6.41 — making it much cheaper to pollute and slashing the financial incentives for companies to invest in low-carbon technologies.
Analysts warn that the prospect of another recession in the debt-ridden continent, and the accompanying decline in emissions, could push prices below euro2 by the end of next month.
The opposition is spreading to Asia.
China has warned the European Union to abandon its controversial carbon tax on airlines or risk provoking a global trade war. Adding weight to the warning, an industry insider told the Financial Times that the Chinese government was seriously considering measures to hit back at the EU if it insists on charging international airlines for their carbon emissions.
The rout of the global warming crowd in 2009 has left them shell-shocked. They thought power and wealth were in their hands. But Climategate blew up in their faces. It’s back to square one for them. They are far less likely to be able to go back to 1990 and start over. Resistance is too widespread.