Say Anything Blog

There are those who speculate that government spending on alternative energy subsidies is justified by the simplistic notion that this will make us less dependent on fossil fuels and “Mid East tyrants.” Apparently they believe that government control of economic decisions and resources is a better methodology than free market capitalism.

Nonsense!  These are some of the same people and the same ideology that told us that LBJ’s multi-trillion dollar “War on Poverty” would eliminate poverty in the US.

The U.S. Energy Information Administration (EIA) is an independent federal agency, which, according to the WSJ, tried to quantify government spending on energy production in 2007.

The agency reports that the total taxpayer bill was $16.6 billion in direct subsidies, tax breaks, loan guarantees and the like. That’s double in real dollars from eight years earlier…

An even better way to tell the story is by how much taxpayer money is dispensed per unit of energy, so the costs are standardized. For electricity generation, the EIA concludes that solar energy is subsidized to the tune of $24.34 per megawatt hour, wind $23.37 and “clean coal” $29.81. By contrast, normal coal receives 44 cents, natural gas a mere quarter, hydroelectric about 67 cents and nuclear power $1.59…

The same study also looked at federal subsidies for non-electrical energy production, such as for fuel. It found that ethanol and biofuels receive $5.72 per British thermal unit of energy produced. That compares to $2.82 for solar and $1.35 for refined coal, but only three cents per BTU for natural gas and other petroleum liquids.

All of this shows that there is a reason fossil fuels continue to dominate American energy production: They are extremely cost-effective. That’s a reality to keep in mind the next time you hear a politician talk about creating millions of “green jobs.”

Meanwhile, the average price of a gallon of unleaded regular in Europe is $7.24.