Alternative Energy Analysis

Alternative and renewable energy is becoming increasingly important faster than people realize. According to the United States Department of Energy, residential energy use in the United States will increase by 25 percent by the year 2025. However, there are many factors that must be taken into consideration when it comes to alternative energy sources and use. The first being the enormous initial investment and length of time needed to build the facilities to produce alternative energy. There must be a subsidy program in place that would allow companies willing to invest in alternative energy to pay back any loans. The second being there is not an existing “production line” alternative energy source operating anywhere in the United States. California does have a few sites operating which could serve prototypes for companies willing to invest in alternative energy.

Oil supplies will not just “run out” because oil production follows a bell curve. On the upslope, the supply of oil is plentiful and relatively inexpensive. On the down slope, the supply of oil becomes increasingly scarce and the cost increases relative to the curve. Running out of oil is not so much the issue as is not having a sufficient supply to keep the economy running. An oil based economy does not need to deplete its entire reserve of oil before it begins to collapse. Even a small drop in production can have devastating effects. During the sixteen month oil crisis in the 1970’s a 5% shortfall in production caused the price of oil to quadruple. In the winter of 2002-2003, California experienced a natural gas shortage. This caused natural gas prices for those consumers to go up by nearly 400%. Both of those events were short lived, but showed the effects of a shortage of supply. Through the development of alternative energy we would be better prepared to handle supply shortages.

There are many different forms of alternative energy all of which have advantages and disadvantages....