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NEW YORK (
TheStreet) -- If you've perceived a hint of desperation in anti-renewable energy arguments lately, there's a reason.
The Philadelphia Fed regularly surveys each state's economy and delivers a handy chart showing how it expects each state to do in the next six months. Its chart for April is
just out and it's mighty curious.
Most states are expecting positive growth over the next six months, but there are five exceptions. Four of them are oil states -- Alaska, Wyoming, Louisiana and North Dakota.
In the energy market, supply and demand are always in very tight balance, leading to a pattern of booms and busts. For the last decade, it's mostly been boom, for producers, the exception being the Great Recession bust.
But something strange started happening about two years ago. As
Marin Katusa of Casey Research noted, prices began diverging.
The "world price" of oil, defined as that of North Sea oil, has generally been stuck at $10 to $20/barrel above that of so-called "West Texas Intermediate," which is U.S. oil. As this is written, the difference
comes to $16/barrel, or about 40 cents/gallon.
Natural gas prices are also basically stuck in neutral. U.S. prices collapsed last year below $2/mcf, and while they're now at $3.85/mcf,
they're still lower than they were three years ago.
The fracking boom is usually given credit for these price changes, but there's something else at work. Supplies of renewable energy in the U.S. have quadrupled in the last five years,
notes the Union of Concerned Scientists, and they're continuing to rise.
Just as important, the cheapest form of renewable energy, which is efficiency, is also increasing. The Rocky Mountain Institute says electricity demand
may have actually hit a long-term peak.
So advocates of fossil fuels have become a little desperate. Peter Ferrara, who works for the Koch Brothers-funded Heartland Institute,
according to the Desmogblog, is now pushing the argument at
the world is cooling, not warming, and never mind the science.
China now threatens the fracking boom, with
the latest REN21 status report showing that 100 Gigawatts of solar energy are now online, and thanks to a fierce Chinese panel price war, the amount spent on panels actually declined last year by more than 10%.