Volts podcast: Lauren Melodia and Kristina Karlsson on energy inflation and how to tame it
Fossil fuels make inflation worse; renewables help solve it.
Americans are struggling with two related problems: one, there’s general inflation, which means pretty much everything is expensive; two, there’s energy price inflation, which means that energy in particular (specifically, oil and gas) is expensive.
This has led some politicians, mainly Republicans-and-Joe-Manchin, to propose a dual solution: cut back on government spending (to tame inflation) and increase domestic oil and gas production (to tame energy prices).
This approach is wrong-headed and counter-productive on both counts. The reasons why are laid out in a new issue brief from the Roosevelt Institute, the first in a series called “All Economic Policy Is Climate Policy” (which, hell yes).
Lauren Melodia, deputy director of macroeconomic analysis at the Roosevelt Institute, and Kristina Karlsson, the institute’s program manager for climate and economic transformation, argue that fossil fuel prices are inherently volatile, and that volatility has serious macroeconomic effects; on the flip side, electricity prices — specifically renewable electricity prices — tend to be far more stable and manageable.
It follows that government spending to build out clean-energy infrastructure is itself anti-inflationary; it removes a source of price instability and replaces it with stability.
This argument is my favorite kind — it put words to something that’s been rattling around in my head for years — so I was excited to talk to Melodia and Karlsson about the volatility of fossil fuels, why we’ve come to accept it as an inevitable fact of life, and why it is, in fact, a choice that we could make differently.