Jonathan Lesser at the Global warming Policy Foundation is putting out a paper “Green Energy and Economic Fabulism.” In it, he points out that governments have been subsidizing green energy development at least since the 1970s.
1978 Energy Legislation “offered subsidies for generating electricity with renewable resources, notably wind and solar, but also small hydroelectric facilities, geothermal plants, and biomass facilities.” And subsidies for corn-based ethanol blended into gasoline.
Energy Policy Act of 1992 “introduced the Production Tax Credit (PTC) for wind and biomass generating plants.”
In the late 1990s state began to mandate renewable electric generation.
Energy Policy Act of 2005 introduced tax credits for hybrid vehicles.
American Recovery and Reinvestment Act of 2009 increased subsidies.
Inflation Reduction Act of 2022 (IRA) increased electric vehicle tax credit to $7,500. Investment tax credit is set at 30% of the capital cost of wind, solar, and battery storage projects, and more for various special categories. “Wind, solar, close-loop biomass, and geothermal energy are also eligible for a production tax credit, currently equal to $27.50 per megawatt-hour (MWh) and indexed to the rate of
inflation.”
Green energy subsidy programs. “New York State has 97 separate programs, Texas has 114 programs, and California has 155 programs.”
And so on. “According to an April 2023 study prepared by Goldman Sachs, the IRA will provide an estimated $1.2 trillion in subsidies over its first ten years.”
Lesser recons that the subsidies for green energy capital costs exceed the total capital cost of a natural gas generating plant. Expert estimate that green subsidies for green generation range from $989/kW to $1,631/kW. “By comparison, the [Energy Information Administration] estimates the average overnight capital cost for a new combined-cycle natural gas plant to be $1,367/kW.”
Oh, I get it. When you have a national crisis the next step is to solve it with subsidies and tax credits — when the government isn’t doing it with direct spending. and grants.
The government has done this on lots of things down the years. Back in the day, electrification was the Big New Thing, so the federal government got into the act with the Rural Electrification Act of 1936. The Rural Electrification Administration is still doing yeoman work in the Department of Agriculture.
I suppose it is easy to experience the climate change racket as something new and unprecedented. But it isn’t. Governments are always looking for some glorious project that is vitally needed if humans are to survive. And almost always, we can assume, they Make Things Worse, because the unhampered market will deliver the best result.
But we stagger on with the government’s g.inormous interventions in health care, in savings, in finance, in education, and on and on. An now in green energy
Guys like me like to think that the green energy programs will finally bankrupt the nation and help lead the current ruling class to the exit.
But probably not. Probably the green enemy revolution will stumble along, with mandates and subsidies as far as the eye can see. And we’ll still manage to get by.
Because, just like in health care, we have no idea how things could be, if the government wasn’t controlling everything. In twenty years people will have no idea how much more reliable and inexpensive energy could be if we weren’t gloriously saving the world from climate change.