Saturday, July 17, 2010

Graph of the Day - July 17th



Okay, it's not the greatest graph from a basic design standard. The visual hierarchy is a little funky since the title is so understated, but the point of this graph is obvious: traditional fossil fuels is already highly subsidized more so than renewables.

For those market-worshiping conservatives (remember, libertarians wouldn't be supporting those huge market altering tax breaks for oil, gas, and coal), this is what people mean when they say that renewable energy doesn't get a fair break in tax incentives.

A very important distinction between the fossil fuel subsidies and the renewables is that the former are written into permanent U.S. tax code and create predictable incentives that drive business decisions. The latter are temporary and are approved year to year and sometimes not. The renewable energy industry doesn't get to plan for continued and efficient growth like the fossil fuel industry.

The Democrats want to end some of those Big Oil subsidies, but good luck ever getting Big Coal to ever pay it's fair share. The subsidies for Corn Ethanol are listed under "climate protecting" but that is highly controversial. All of this might create decent economic policy, but it is horrible environment policy. Energy policy must be somewhere in the middle.....it cannot be considered merely a part of economic policy. The renewable energy subsidies should be made permanent and predictable. Europe has figured it out...why can't we?

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