Editor’s note: Contributing columnist, Steve Nicklas, expresses his views and insight on various topics in Marketplace.
— Steve’s Marketplace —
If the gnawing prices of gas and electric and groceries don’t bite you, an alligator or a shark might. At least it can seem that way for Florida residents, balancing a seesaw of affordability and vulnerability.
And it’s a dizzying, up-and-down ride some cannot escape. Green-energy advocates offer silly alternatives. If you don’t like high gas prices, buy an expensive electric car (hopefully you won’t need to replace the battery). If you can’t pay your electric bill, invest $15,000 into solar panels to generate your own electricity. If meat prices are weighing down your grocery bill, adopt a vegan diet.
There are caveats galore with these simple-minded solutions, especially with solar panels. Some insurance companies are now dropping coverage for homes with rooftop solar panels, out of concern for their durability in high winds. Just another underlying complication of green energy. And another reason for insurance companies to avoid coverage in Florida.
And if your homeowner insurance costs are also rising, with or without solar panels, you are not alone. Misery loves company, and anyone cancelled by an insurer has plenty of company. The number of Florida residents forced to seek insurance through the state-funded Citizens Property Insurance Corp. is alarming.
Citizens is a choice of last resort for homeowners’ insurance, but it’s a necessity for those who cannot obtain private insurance. However, it’s part of a compounding problem. Not only does the state endure substantial costs after a hurricane, but it also must pay out the claims from homeowners in the Citizens pool. The costs are astronomical and exponential – and might shock you.
In addition, many Florida residents are getting zapped by higher electricity costs. Most Florida electric companies still use fossil fuels, which have soared in price due to federal government intervention. So it’s costing more for the utilities to produce their product. Of course, this is passed on to customers.
Aha, there you have it. A reason to switch everything over to alternative energy sources like wind, solar, etc. While a noble idea, it’s unrealistic. Very little electric is generated through these alternative sources in the U.S., and you cannot flick a switch to convert everything. It’ll take many years to even dent electricity demand.
For instance, you must build new windmills and solar-panel farms, which are costly and cumbersome. Then they must be connected to the grid. And even more troublesome, many of the parts for these sources are made by our geopolitical enemies (most notably China).
From there, you pray the sun shines brightly and the wind blows freely. Look no farther than to our European allies like Germany, who have shut down most of their fossil-fuel plants. Without their own oil production, they find themselves in a predicament, relying on imports from hostile places like Russia. It’s no different than the U.S. pleading for oil from Venezuela and the Middle East.
A solution for inflation is on the way, you probably have heard. The misnomer known as the Inflation Reduction Act is going to subdue rising prices, or so they say.
However, it’s little more than a progressively modeled green-energy initiative. Packaged with a fancy name. It resembles an Inflation Production Act. It even prescribes higher taxes on beef and chicken, two staples of family diets.
Again, it’s designed to subtly change the behavior of U.S. citizens – by an overbearing federal government. It’s another step toward socialism. And it will ultimately take a bite out of our traditional ways of life.
In the meantime, keep an eye out for the gators and the sharks.
Steve Nicklas is a financial adviser with a national brokerage firm who lives and works on Amelia Island. He is also an award-winning columnist. His columns also regularly appear in several weekly newspapers in North Florida and in Southeast Georgia, and on his website at SteveNicklasMarketplace.com. He has published a book, “All About Money,” of his favorite columns from the past 20 years. The book is available on Amazon. He can be reached at 904-753-0236 or at [email protected].