subsidies

  • The 2014 state of wind energy

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    Ever since the wind power Production Tax Credit expired last year, the lobbying to restore the costly, wasteful tax credit has been intense. Recently, 26 Senators and 118 House members signed a letter urgning its restoration — but whether they will succeed is an entirely different matter. As a result, even GE’s Jeffrey Immelt is talking about “a world that’s unsubsidized.”

  • Loss of production tax credits brings big wind chill to the cooling subsidy-dependent market

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    The recently ended wind power production tax credit was costing the U.S. taxpayer at least $12 billion a year — and if the claimed number of jobs was indeed created by these subsidies, they were underwritten at about $32,000 per job. By contrast, so-called subsidies (which are actually tax preferences) for fossil fuel production cost about $2,100 per job. Meanwhile, wind power is now an average $54 per megawatt-hour — up from $37 in 2005, and much higher than fossil fuel power. There is good news: We are nowhere near as bad off as many European countries that have subsidized wind power production.

  • New NAS study lambasts Obama “climate” subsidies

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    As part of his sweeping new climate action plan to address alleged global warming, President Obama intends to establish tens of billions in new subsidies for so-called renewables like solar and wind power. But according to FoxNews.com, a groundbreaking study recently completed by the National Research Council shows they will be virtually useless at reducing greenhouse gases.

  • Rooftop solar: welfare for the wealthy?

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    Net metering has been around since the early 1980s when solar panels were expensive and few people had them. But the dynamics changed drastically when states began passing renewable portfolio standards (RPS) that required predetermined percentages of electricity be generated from renewable sources—some even specified which sources are part the mix and how much of the resource was required. For example, in my home state of New Mexico, the Diversification Rule requires that 1.5% of the RPS must be met by “distributed generation” (read: rooftop solar). Arizona requires 30% of the RPS be derived from “distributed energy technologies” (once again, rooftop solar).

  • Subsidies to wind and solar dwarf those to “big oil” — but wait! There’s more!

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    Oil depletion allowances, the first category, principally apply to small independent producers, with similar benefits available for all mineral extraction, timber industries, etc., allowing them to pass the depletion on to individual investors. Large integrated corporations haven’t been eligible for these since the mid-1970s. Expensing indirect drilling costs involves writing off expenses in the year incurred rather than capitalizing them and writing them off over several years. Closing this “loophole” would only change the timing of taking he expense, not the total amounts of the so-called “subsidy.” The third category, a tax credit for taxes paid to foreign nations, is available for all international companies. This provides an offset to foreign taxes, often paid as royalties, so that the companies aren’t taxed twice on the same income.

  • Don’t be fooled: a carbon tax will hurt the poor the most!

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    From a social cost perspective, carbon taxes are, by nature, regressive, meaning that they inflict largest pain burdens upon low-income households. As Marlo Lewis observes, this presents a “Catch-22” dilemma for any Republicans. If on one hand, they offer to support a carbon tax in exchange for cuts in corporate or capital gains taxes, they will be accused of seeking to benefit the rich at the expense of the poor. On the other hand, any “carbon dividends” paid out to offset higher energy price burdens on poor households will create a new class of welfare dependents …a costly consequence for the general public that Democrats are much less inclined to worry about.

  • Virginians will get burned by this solar program

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    A select group, described as “sophisticated investors” by one solar panel installer, was concerned with return-on-investment issues and maximizing their multiple, tax-advantaged solar panel installations. They requested that the 15 cent/kWh buy-rate be increased by Dominion to offset the anticipated Federal and State income tax burden. Otherwise, the net after-tax-return would be about the same as for the current net energy metering plan, thus there would be no monetary incentive to participate in the solar plan.

  • Falling Leaf: Consumers not buying

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    Nissan abandons its 2012 sales goals. Short range, high cost, deteriorating batteries, coal fired electricity, potential bricks and a drain on the treasury — electric cars have much to overcome before consumers embrace them.

  • Al Gore’s hundred million dollars

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    Al Gore, who left public office with an estimated net worth of two million dollars, is worth an estimated 100 million dollars today according to the Washington Post. Fourteen green-tech firms in which Gore invested received or directly benefited from more than $2.5 billion in loans, grants and tax breaks, part of President Obama’s historic […]