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Thursday, April 28, 2011

How energy subsidies really work

Steve Stolle of Charlestown wrote a letter published in the April 26 Westerly Sun . In that letter, Mr. Stolle lambasts government subsidies for wind power development and especially the $750,000 grant that Charlestown could have used for municipal wind turbines at Ninigret Park. Because of the town’s anti-wind ordinance, we had to forfeit that grant.

Like many opponents of alternative energy, he says wind energy apparently fails to make enough economic sense to garner sufficient funding by itself.” 

Here’s a question for Mr. Stolle: give us a list of energy technologies that DON’T receive government subsidies and special treatment in the marketplace. Oil & gas? Nope. Nuclear power? Nope. Coal? Nope.

According to the US Energy Information Administration, the fossil fuel industry received $72 billion in direct federal subsidies from 2002-2008 compared to only $29 billion for renewable technology. Nearly all of the federal subsidies for fossil fuel development are permanently written into the US Tax Code.

The nuclear power industry has received over 30 federal subsidies over the past 50 years and could not survive without them. The nuclear industry gets between $455 million and $1.1 billion every year just for decommissioning alone. Most subsidies to the nuclear industry involve shifting risk and liability away from industry and onto the government or public.

By Mr. Stolle’s reasoning, all of our existing conventional energy technologies "fail to make enough economic sense" to exist. As noted, the nuclear industry has been nursed along with government support for more than 50 years. Many of the fossil fuel subsidies are around a century old – and they’re permanent.

By contrast, subsidies for wind and other renewable energy development are much smaller, definitely not permanent and have only been available in serious amounts for the past several years.

All technologies take a while to ramp up. It took decades for electricity to catch on and for kerosene to replace whale oil in lamps. Research and development is an investment in the future.

We do not demand new ideas to be proven before they are tested. We test them so they can become proven. It’s crazy science to think otherwise, almost as crazy as some of the hysterical and unfounded claims about the “dangers” of wind power.

We need a real debate in Charlestown about energy, one that's grounded in fact and reality.

Author: Will Collette