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But with the level of compensation people think energy producers should pay to offset their "negative externalities" -- if governments forced them to pay it, th
by IsaacL 9y ago
But with the level of compensation people think energy producers should pay to offset their "negative externalities" -- if governments forced them to pay it, the price of energy would rise by a huge amount, disrupting the economy, and making the previous calculation of the externalities meaningless.
Even the renewables would then need more subsidies, to pay for increased manufacturing costs and the fuel for the trucks that repair their transmission lines.
Point is its obviously misleading to say that fossil fuels are more heavily subsidied than renewables. People who hear that will assume that fossil fuel companies are being given taxpaper money, as the renewable companies are, when that is not the case. I don't think lumping together "companies that receive free money" and "companies we think should be fined" is an honest way to frame the situation.
- leephillips 9y ago"People who hear that will assume that fossil fuel companies are being given taxpaper [sic] money, as the renewable companies are, when that is not the case." That is in fact the case. Here is just one component of those direct subsidies, as reported by the U.S. Treasury Department: https://www.treasury.gov/open/Documents/USA%20FFSR%20progress%20report%20to%20G20%202014%20Final.pdf https://www.treasury.gov/open/Documents/USA%20FFSR%20progres...
- harryh 9y agoWhen the true costs of coal are not being paid by those that use coal based electricity the economy is already being disrupted. More coal than would be economically efficient gets consumed because coal based electricity is artificially cheap. Implementing pigovian taxes repairs the existing disruption. Do not fall prey to status quo bias!