Alex Epstein on Energizing Puerto Rico

The video covers Alex Epstein’s full Congressional testimony on energy in Puerto Rico — including Q&A.  For those who prefer reading text, I provide below a transcript of most of it, with light editing transposing a spoken presentation into a written one.

Thank you for the honor of testifying before this committee.  What I say today will shock many of you. My views on energy are indeed unconventional, but I hope you hear me out with an open mind since we share the same goal: which is a flourishing and prosperous Puerto Rico.

I want to make the case that the one thing that will most help the people of Puerto Rico lift themselves out of crushing poverty is the thing many of you believe should be eliminated; and that’s low-cost reliable fossil fuel energy.

For just a brief moment I’d like to ask all of you to close your eyes. I’d like you to imagine an ambitious young Puerto Rican woman. I’ll call her Mia. Mia studied hard at the Emilio Delgado high school in Corusol. Mia’s passion is artificial intelligence, and she dreams of working at a high-tech startup. Sadly opportunities are sparse because many companies have fled Puerto Rico, and many more avoid it due to high cost and unreliable energy. So Mia applies for a remote job at a silicon valley tech incubator. But during her interview the electricity suddenly cuts out. The screen goes blank; she hopes it comes back quickly but hours go by with no internet as she waits in the sweltering heat with no AC. Think of Mia’s despair in those moments. Think of how much low-cost reliable energy could have helped her when she needed it most.

I know that every member of this committee shares the same goal I do: A healthy, prosperous and flourishing Puerto Rico. In order to help millions of talented and passionate people like Mia, we must look carefully at the full context of facts about Puerto Rico’s energy options. Here are three crucial facts that i almost never hear discussed about Puerto Rico and I want to highlight them.

First, the percentage of Puerto Ricans currently living in poverty is 43 percent.

Second, the cost of energy in Puerto Rico versus the states is up to three times higher

Third, the per capita income in Puerto Rico is $13, 000.

Honorable members does it strike you as fair that someone earning $13,000 per year should be paying three times what you and I pay for the energy that powers our homes? I don’t think that’s fair and I’m guessing you don’t think so either.

So what’s the solution? While we’re told that solar and wind can provide low-cost reliable energy, nothing could be further from the truth. Because solar and wind are unreliable; they don’t replace reliable power plants, they add to the cost of reliable power plants. The more wind and solar that grids use, the higher their electricity prices. German households have seen prices double in 20 years due to wasteful unreliable solar and wind infrastructure. Their electricity prices are three times ours, which are already too high due to solar and wind.

The only way for Puerto Rico to get low-cost reliable electricity anytime soon is using low-cost reliable fossil fuel energy sources like natural gas and coal, along with some massive regulatory reforms. I discuss in my written testimony actions such as scrapping the Jones act. We owe it to the people of Puerto Rico to give them the full context: The benefits and drawbacks of all their options. This includes recognizing any real coal ash problems, but also recognizing that there are many solutions to coal ash used around the world that don’t require shutting down power plants. Giving Puerto Ricans the full context also includes recognizing that fossil fuels CO2 emissions do impact climate. But it also includes being precise not hysterical about that impact. As I explain in my written testimony there is climate change, but not a climate crisis; and certainly not one that justifies condemning generations of Puerto Ricans to endless poverty by denying them low-cost reliable fossil fuel energy.

The stakes could not be higher. I think about Ellaria Davila who was breathing with the help of a mechanical ventilator. During prolonged blackouts her ventilator shut down and tragically she died. Her autopsy noted plainly that a ventilator “does not work without power.” Ladies and gentlemen: Nothing works without power, not the ventilators, not incubators, not farms nor schools. Not the millions of brave and passionate people who want to provide for their families and live lives of dignity and opportunity. You have it in your power today to help Puerto Ricans gain the power, the low-cost reliable power they need to escape crushing poverty.

I hope that any of you who are interested in this mission will join me on a fact-finding trip to Puerto Rico in the coming weeks. We will have an honest open discussion with Puerto Rican energy experts who are all too often left out of important policy discussions like this one. I would be honored to work with all of your offices, Democrat and Republican, to help the people of Puerto Rico flourish. I look forward to your questions and thank you again for the opportunity to share my perspective with you,

Q: Can you describe the benefits that affordable reliable energy has for communities in general?
A: Sure. Energy is the industry that powers every other industry; the lower cost and more reliable energy is the lower cost and more reliable everything is and vice versa. I just want to stress that Puerto Rico’s energy situation is terrible, and one of the reasons I want to testify today is because nobody is talking about that. They’re talking about, How do we maintain the status quo? The status quo is terrible in Puerto Rico. They desperately need more low-cost reliable energy.

And just a further comment. It doesn’t seem that people here know the facts and the percentages I noted about Puerto Ricans’ situation. For instance, I’m really disappointed that representative Ocasio-Cortez talks about shutting down the coal plant tomorrow. I don’t know if anyone knows what percentage of renewables the whole island has. So its’ 2.5%.

This is so disappointing that we’re talking about this so unseriously, when we really need to highlight the value of low-cost reliable energy and really talk about why Puerto Rico needs much more of it.

Q: In your opinion how will the Biden energy policies impact Puerto Rico?
A: It seems they’re going to make the rest of the US like Puerto Rico. I’m in California, and we’re already seeing this. In my work, I had two projects disrupted last year by blackouts.

We’re also seeing it in Texas. I don’t mean to pick on Representative Ocasio-cCortez, but she tweeted the infrastructures failures in Texas are quite literally what happens when you don’t pursue a green new deal. No, in fact plenty of places around the world can deal with hot and cold when they have enough reliable resilient electricity. Texas defunded reliable resilient electricity including winterization to pay tens of billions of dollars for unreliable solar and wind that don’t work when you need them the most. This energy policy is really the existential threat to talk about. It’s a threat to the US and to make Puerto Rico into a truly and consistently third world county.

Q: Mr Epstein in your testimony you noted that the most promising step that can be taken to lower emissions long term is the development of nuclear. Can you explain a little bit further why you believe nuclear energy Is more effective as a good alternative energy choice?

A: Sure.  It is so wrong that when we talk about potential alternatives to fossil fuels that nuclear is ruled out. You saw with the proposal of the green new deal there was anti-nuclear insistence on renewables which in practice means solar and wind. Renewable mandates usually exclude hydro as well.

This is totally the wrong approach if you’re looking for low carbon alternatives you have to be open to everything. And unfortunately the world is so anti-nuclear today that we’re shutting down record amounts of nuclear capacity this year, even though everyone claims to care about CO2 emissions.  In fact, nuclear provides extremely reliable on-demand power. Every grid in the world that works has on-demand power backing up solar and wind, since batteries do not exist anywhere.

If you’re concerned about coal ash, first of all you need to do real scientific studies that are systematic not just anecdotes and correlations. But if there’s a real problem we know how to solve coal ash problems. There are lots of ways to do that and if you don’t want to use coal in a given location, use natural gas or use nuclear. But the idea of mandating these unreliable solar and wind farms that make energy more expensive wherever they’re used, and then just manipulating data to ignore that fact, that policy is just absolutely devastating for Puerto Rico and anywhere else it’s applied.

In my testimony I noted this is being encouraged around the world by the US. We’re telling India to do this, and Indonesia to do this, places in Africa to do this to try to eliminate fossil fuels when that’s what they need to make their lives better. I think that’s really shameful and and I hope it stops.

Q: Mr. Epstein, you mentioned the need to consider the full context as we assess Puerto Rico’s energy generation. What what are the factors we should consider to understand the full context of the consequences that would stem from closing the AES coal plant?

A: Well, in general we just need to recognize that fossil fuels are the only way for them to get low-cost reliable energy for the foreseeable future. They need far more of it and there are very clear well-documented ways of using fossil fuels in a clean and responsible way. So the fact that there may be a problem with this particular plant, and again that needs to be scientifically studied so you come with a solution. It doesn’t mean we should shut it down; it means we should deal with the problems.

But more broadly, get rid of all the bad regulations and limitations that are preventing Puerto Rico from having low-cost reliable energy and flourishing.

Q: Are these things mutually exclusive? Can there be affordable and reliable energy today relying completely on renewable energy? 

A: I approach it a little bit differently because I think the world just undervalues low-cost reliable energy. Again this is fundamental to human flourishing, and this is something desperately needed around the world. Without low-cost reliable energy from fossil fuels people here can’t claim to care about life expectancy and health. These energy sources have driven down the rate of extreme poverty from over 40 percent people making less than two dollars a day to less than 10% in my lifetime. Access to energy is so important, yet billions of people still lack it. Four and a half billion people are living on less than ten dollars a day.

So my view is the world needs way more energy, and yes, we fortunately have modern technology that can produce it more and more cleanly. But to just look at the side effects of fossil fuels and not look at the benefits, you are condemning people to poverty, to suffering, condemning them to danger.

And I want to just remind everyone: A natural environment is not a good environment. Nature doesn’t give us a clean healthy environment, it gives us a very dirty and unhealthy environment. We need low-cost reliable energy to make the world a very livable place, and those of us who benefit from that in the US should really have sympathy for those in Puerto Rico, let alone the rest of the world that’s really really poor. And we should be doing nothing to impede them from using the most cost effective energy they can.

In conclusion, I would really welcome going on a fact-finding mission with many of you to look into the different energy realities. I think that we can see a way to move forward with cleaner coal, natural gas and nuclear instead of having this crazy dogma that we must rely on unreliable renewables. We should use the most cost-effective energy, and Puerto Rico needs far more of it not less.

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