Government Energy Subsidy is an unintended “Shape-Shifter” — the U.S. Dept. of Energy’s ethanol rules have resulted in what the DoE says will require 4.8 billion of this year’s 12 + billion bushel U.S. corn crop to satisfy ethanol demand. Corn prices have risen 70% since July ’10 on higher demand and shorter crops. What do you think this does to food costs everywhere?
Take a look at Wind’s Portfolio of Subsidies in the U.S.: “Accelerated Depreciation”, “Wind Production Tax Credit (PTC)”, “Investment Tax Credit (ITC)”, “Cash Grant in Lieu of ITC”, “U.S. Dept. of Agriculture Grants”, “DoE Loan Program”, “Additional DoE Subsidies – wind energy R&D grants”, “Mandated use of ‘renewable’ energy by Federal Agencies”, “Wind Farm Land Use Mandated by U.S. Government for Bureau of Land Management and US. Forest Service managed Land”, “Federal Tax Subsidies for Wind Farm Equipment Mfrs.”, “State Tax Subsidies for ‘wind farm’ owners”, and we don’t want to leave out “Local Governemnt and Economic Development Agency Tax Subsidies”.
And there are the “nuclear energy subsidies” — Nuclear is a loser only to the extent that government policy and environmental bigotry prevent it from becoming a winner.
Sometimes government “subsidies” are really a form of extortion. Case in point – federal nuclear loan guarantees. The orginal purpose was to cover the very real risk that government could wipe out billions of private investment through changes in licensing and regulation of nuclear power plants. It has happened more than once in the institutional memory of Wall Street and utility management. It would cover ONLY regulatory risk. It would require that our government put some skin in the game that the Nuclear Regulatory Commission runs, along with the environmental bigotry litigation. Today, an investor is faced with the cold fact that if he doesn’t apply for and receive this loan guarantee, the likelihood is that the project will eventually NEED it, because of NRC changes, and environmental lawsuits. Hence, U.S. private enterprise has to participate. To not take a guarantee is to expose the U.S. nuclear private investors to future extortion demands from U.S. government officials.