The world does not have enough energy.
Too little energy production for too many people. And we desperately need more energy.
It doesn’t mean resorting like desperate people to coal-fired power plants. It means making serious industrial plans.
There is inflation in the United States and inflation in Europe. U.S. inflation is an excess of circulating money. Europe is just a little more circulating money than usual and a gigantic unprecedented energy crisis.
European inflation is a supply and demand imbalance, underlying which is an imbalance in the energy market. Raising rates in the United States can solve their inflation problem.
Raising rates in Europe without a decisive policy of rebalancing supply and demand is bound to fail in its goal.
The United States is energy independent and, despite this, has passed a law that is probably the largest legislative intervention ever conceived for clean energy production.
It is called the New Energy Economy, and when we understand it in Europe, perhaps we will have begun to solve many of our problems.
The U.S. Senate has approved the appropriation of $400 billion for the energy sector.
Some of the spendings, it is true, is for the oil and natural gas industry. But most of that money incentivizes the production of alternative energy sources.
The legislation focuses on a few key mechanisms.
1) It extends 30 percent tax credits on solar energy investments for another 10 years until 2033.
2) Introduces a new 20 percent tax credit on self-storage of energy (a sector that becomes of great importance for choosing stocks in which to invest).
3) Adds additional tax credits of up to 20% for clean energy projects that meet certain labor and location requirements.
4) Introduces a new green and blue hydrogen production tax credit for 10 years.
5) Extends the electric vehicle tax credit indefinitely, removes the electric vehicle tax credit limit for manufacturers who have sold more than 200,000 electric vehicles, and allows the electric vehicle tax credit to also apply to point-of-sale.
6) Introduces a new electric vehicle tax credit for sales of used electric vehicles.
It makes one smile that the European Union has issued a rule, without any serious strategic and economic planning, that from 2033 only electric vehicles must circulate in the Union. It is true that initiatives are up to individual member states, but …
“We go to war with toothpicks, while the opponents have the atomic weapon.”
Here it is: Europe is issuing a piece of legislation that is an absolute revolution … heroically pulling out toothpicks.
As a result of the legislation introduced in the United States (which agreed, in substance, with Democrats and Republicans), many analysts predict that the clean energy revolution will experience an unprecedented boom in the 1920s.
The new legislation sets the stage for a rapid spread of hydrogen, electric vehicles, and solar energy storage technologies.