Monday, May 12, 2008

Government Subsidies To The Rescue

What does government sponsorship of industry get the tax payer? Usually nothing like in the case of Syn Fuel in the 1970's and marginally more from sources like wind and solar. This opinion piece in the WSJ makes several great points. Here is a sample:

The wind and solar lobbies are currently moaning that they don't get their fair
share of the subsidy pie. They also argue that subsidies per unit of energy
are
always higher at an early stage of development, before innovation makes
large-scale production possible. But wind and solar have been on the subsidy
take for years, and they still account for less than 1% of total net
electricity
generation. Would it make any difference if the federal subsidy
for wind were
$50 per megawatt hour, or even $100? Almost certainly not
without a
technological breakthrough.

The real question for me though is "why should any of these industries be getting a subsidy?" Let consumers decide and pay for the best alternative for them. Right now, that is hydrocarbon based energy for me and my needs. IF you want to be "green" then pay $20/kw-hr for wind or solar while I enjoy $0.10/KW-hr coal. Afterall, 30 years of government subsidies for the solar business has got us nothing but expensive options.

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