No paper has done more to deceive the public about the economics of renewables than Lazard’s LCOE+ paper. Lazard, a financial advisory and asset management firm, publishes an “annual analysis that provides insights into the cost competitiveness of various energy generation technologies,” and proponents of renewables still wave this paper around as if it were gospel. The whole of their green dream is collapsing around them, and they still have faith in the findings of Lazard. This is where I feel compelled to educate people about the true nature of Lazard’s research. It is not coming from a disinterested party. The most fitting metaphor for Lazard is that of a circus master whipping up a frenzy in the market to enhance its position as deal broker. There is nothing honest about their research.

Lazard’s role in the market is like that of Bear Stearns and Lehman Brothers prior to the mortgage collapse of 2008. The difference is that Bear and Lehman might have believed their own bullshit and when the music stopped, were left holding worthless mortgage assets that brought them to their knees. I assume that Lazard is not so stupid as to make the same mistake and hold green assets on their books. They should wisely collect their investment banking and asset management fees and retire to their estates in the Hamptons leaving others like the California Public Employees’ Retirement System (CalPERS) holding the bag.

Some of the biggest advocates of the Lazard paper have no financial stake in the renewable industry. They are in academia, NGOs, or government bureaucracy. They point to the paper as proof that the investment community, which has skin in the game, still believes in renewables. They blindly believe that the interests of Lazard and those of parties convinced by its LCOE report to invest in the so-called “energy transition” are aligned.

I used to find it annoying when people shoved the Lazard paper at me in response to my findings that were contrary to it. Now I see it only as the desperate action of a drowning man grabbing on to anything that might keep him afloat.

Image: Public domain.