"Emerging fossil fuel prices are making renewable energy more involving in the global market"
Renewable energy can't offer much relief to drivers and companies seeing their profits evaporate because of skyrocketing oil prices, because viable green alternatives to gasoline are hard to find. Biofuels such as ethanol and biodiesel aren't widely available, and hydrogen-powered cars aren't expected to hit the market for years.
But in the electricity market, green power, especially wind, is already competing with traditional sources. At today's average wholesale prices, wind costs 4.2 cents per kilowatt hour, compared with 4 cents for coal, 6.8 cents for natural gas, 9.1 cents for oil and 10 cents for nuclear power, according to Kyle Datta, managing director at the Rocky Mountain Institute, a research group focused on eco-friendly business.
Experts estimate that at today's consumption rates, known global supplies of oil and natural gas would be depleted within decades. But prices are expected to rise significantly long before supplies run out, making those fuels too expensive to use at current levels.
"They're never going to run out, but the ability to match supply to demand may already have run out, especially for oil," said Stephen Leeb, president of Leeb Capital Management and co-author of "The Oil Factor," which predicts that oil could hit $100 a barrel by 2010.
In the short term, fossil fuel prices are being driven up by war, political instability, natural disasters and other variables. The long-term outlook is clearer — global supplies are dwindling as demand soars, particularly in China and India, where automobiles are multiplying and economies are growing a breakneck speed.
"We should treat the prices as a warning that we need to act to promote energy efficiency and renewable energy," said Ralph Cavanagh, an energy expert at the Natural Resources Defense Council. "They represent a terrible threat to the vitality of the United States."
Meanwhile, improving technology, tax credits, low interest rates and government mandates are making renewables more widely available, establishing an inexhaustible energy supply that will keep driving prices down.