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by John Brian Shannon | July 29, 2017
All I’m asking for is that renewable energy gets the same subsidies as fossil fuels or nuclear energy. Is that so unreasonable?
You can determine the subsidy costing by any method you choose using a per unit of energy formula — per Barrel of Oil equivalent (BOe) or per kW/h, or any other unit of energy formula you want — but conventional energy gets four-to-six times the subsidies as renewable energy, depending upon which method you use for your calculations.
America’s energy security is better served by LETTING THE MARKET CHOOSE what’s best for the continent and that can only happen when all energy producers play on the same subsidy playing field.
Renewable Energy adds to national security, while Conventional Energy leaves North America vulnerable
North America’s biggest national security vulnerability (aside from bio-warfare) comes from the hundreds of thousands of miles of electrical transmission corridors (pylons and power lines) and pipelines that crisscross the continent.
Every Pentagon General, along with every military rank down to Corporal knows it would be boringly easy for even the most inept enemy of the United States and Canada (both national grids are interconnected) to destroy the North American grid with as little as three well-placed air-to-ground missiles, or alternatively, three truck bombs. Those interconnect sites are unbelievably unprotected.
If that were to happen in mid-winter, hundreds of thousands of North Americans would die, and that’s indisputable.
That it hasn’t happened, proves to me that North America doesn’t have any ‘real’ enemies or it would have occurred a long time ago. (Yes, the U.S. and Canada are ‘irritated’ at some countries and some countries are ‘irritated’ at us. But by virtue of the fact that *they haven’t hit us where we’re most vulnerable* proves they aren’t real enemies, they’re only ‘irritants’)
Centralized Power vs. Decentralized Power
Conventional grid adherents are living in a previous century — a centralized grid WAS the best thing for North America in the 20th-century — but those days are long gone!
Fossil fuel supporters should stop helping our enemies, which they do by supporting a conventional national grid that even the U.S. military 3X over couldn’t protect!
Decentralized power is the ONLY choice for an energy-secure America!
Make better investment returns on Renewable Energy by leveling the subsidy playing field
I understand that many people are heavily invested in fossil fuels and nuclear power — and I don’t blame them, they were safe and secure investments for decades but such industries run counter to the national interest in the 21st-century — good investment returns aside.
And yes, the ONLY reason you have those high returns is that those industries are heavily-subsidized by U.S. and Canadian taxpayers; Oil & Gas get $80 billion per year in the U.S. and about $10 billion annually in Canada, nuclear a bit less — but nobody really knows for sure, not even the governments — because it’s all mashed together with nuclear fuel production, long-term ‘spent fuel’ storage, nuclear warhead production and nuclear warhead disposal.
Citizens can’t see this because those white elephants are obscured by mountains of cash!
Efficient investment vs. Inefficient investment
Energy companies have become like the Big 3 during the 1960’s and 1970’s, big, powerful, lazy, and wholly unwilling to adapt to changing market conditions.
Remember way back in 1970 when 95% of cars registered in the U.S.A. were domestic built and sold? Well, due to the laziness of the Big 3, in 2017 less than 35% of new car registrations are North American makes, and more than half of the parts of North American manufactured vehicles are supplied by Asia or Mexico!
You call that progress???
It’s killing North America!
A high 35% corporate tax rate in the United States might have had something to do with how that came to pass.
Renewable Energy creates more jobs than Conventional Energy (even using fossil fuel industry stats!)
Millions of people are unemployed in North America because the 1% wanted higher investment returns on their energy stocks so North American corporations off-shored millions of jobs! UN-AMERICAN in the extreme! (You already ‘work’ for China’s interests by sending North American jobs there, why don’t you just move there?)
Fossil fuel companies and their investors MUST become patriotic by relearning how to be ‘fleet of foot’ and adapting to the changing national security paradigm — and become ‘ENERGY COMPANIES’ instead of (only) Oil & Gas or (only) nuclear or (only) coal companies.
Profit is a great thing! Energy companies should make plenty of profit because energy is an ultra-important factor in the 21st-century. However, uneven energy subsidies are not a great thing.
Putting a square peg in a square hole, not a square peg in a round hole
When we train soldiers, we don’t try to put a square peg in a round hole — we choose those people based on their merit.
(The best snipers become snipers — not truck drivers. The best tank captains become tank captains — not dishwashers. And the best fighter pilots don’t peel potatoes aboard our warships!) Rather obvious when you think about it, isn’t it?
By the same token, if electricity companies were to embrace ALL energy (they don’t do it now because some energy is highly subsidized and some isn’t) they could then have the option to put a round peg in a round hole and a square peg in a square hole. As it should be!
I must add that gas-fired power generation is increasingly important towards meeting demand — and even moreso as increased renewable energy capacity comes on stream. Natural gas burns up to one million times cleaner than brown coal (lignite) and up to ten-thousand times cleaner than the best black coal (anthracite) and gas power plants can be as local to demand centres as required — quite unlike hydro-power dams and coal-fired power plants, and even nuclear power plants which also aren’t welcome near city centres.
Again, by setting an even subsidy playing field THE MARKET will choose which kind of power to best use in what location — and don’t worry — your precious investment returns will be just as high as they are now. Maybe higher!
As for U.S. jobs, solar produces more jobs than fossil fuel and nuclear power producers put together — and rising exponentially.
By setting a level subsidy playing field, the cream of the crop among energy producers will rise to the top, and market forces will choose which peg to put in which demand hole — nothing could be more efficient!
And in that case, renewable energy will win hands down — with natural gas-fired generation rising to meet demand to cover the variability of onshore wind power output (but not offshore wind power, because there the wind blows relentlessly) and solar power output after the Sun sets.
National security will become greatly enhanced as North America will no longer be dangling from a thread via the hundreds of thousands of miles of pylons and power lines that will no longer be required, as renewable energy is local energy, while conventional energy must carry electricity many thousands of miles. (And natural gas-fired generation can be local energy too, when the power plant is sized according to local demand)
Stop choosing profit over North American national security!
Stop arguing against North American national security, stop arguing against a free market, and stop arguing that you can’t make the same or better profits via renewable energy — assuming the same per unit of energy subsidies as conventional energy receives. It’s intellectually dishonest.
And for those who want to send me ‘green bullets’ (we all know what that code-phrase means) be man enough to bring it to my face, mano a mano.
I’m in Vancouver.
Originally published on DeSmogBlog by Ben Jervey.
The exact worth of massive global fossil fuel subsidies is incredibly hard to figure. There’s no real consistency in the definitions of subsidies, or how they should be calculated. As a result, estimates of global subsidy support for fossil fuels vary widely.
According to a new analysis by the Worldwatch Institute, these estimates range from $523 billion to over $1.9 trillion, depending on what is considered a “subsidy” and how exactly they are tallied.
Worldwatch Institute research fellow Philipp Tagwerker, who authored the brief, explains:
The lack of a clear definition of “subsidy” makes it hard to compare the different methods used to value support for fossil fuels, but the varying approaches nevertheless illustrate global trends. Fossil fuel subsidies declined in 2009, increased in 2010, and then in 2011 reached almost the same level as in 2008. The decrease in subsidies was due almost entirely to fluctuations in fuel prices rather than to policy changes.
In other words, though the estimates vary widely, they all agree that fossil fuel subsidies are back up to the record levels they were at in 2008, before the financial crisis caused a temporary dip. So while world leaders, including President Obama, talk about ending subsidies that benefit one of the world’s richest industries, there hasn’t been any actual reduction.
Why such difficulty calculating the subsidies? For starters, subsidies typically fall into two broadly different categories: production subsidies and consumption subsidies. Production subsidies are what you think of when you hear about special tax rates for oil companies or grants or loan guarantees to “clean coal” projects. Basically, they include anything that lowers the cost of energy production — through tax advantages, loan assistance, grants, or anything else.
Consumption subsidies refer to any financial mechanisms that lower the cost of energy for the end consumers. Think of the artificially low gasoline prices in Venezuela, or even something such as tax breaks for home heating fuel.
According to Tagwerker, production subsidies are most common in wealthier, industrialized countries, while consumption subsidies are more common in developing countries with populations struggling to afford fossil fuels.
The $523 billion number above — standing as the bottom boundary of the range of global fossil fuel subsidies — represents only the consumption subsidies for coal, electricity, oil and, natural gas in 38 developing countries, as estimated by the International Energy Agency (IEA). It doesn’t include any production subsidies at all.
Production subsidies are often quoted at $100 billion a year, a number that comes from a June 2010 report to the G-20 leaders from the Organisation for Economic Co-operation and Development (OECD), the IEA, the World Bank, and the Organization of the Petroleum Exporting Countries (OPEC). But that doesn’t include so-called “support measures” like:
export credit agencies (estimated at $50-100 billion annually)
cost of securing fossil fuel shipping routes (estimated at $20-500 billion/year)
Then there’s the issue of externalities. Tagwerker argues that external costs — like those associated with resource scarcity, environmental degradation, and human health — should be considered in subsidy calculations, as their absence artificially lowers the true cost of fossil fuel energy.
“Without factoring in such considerations, renewable subsidies cost between 1.7¢ and 15¢ per kilowatt-hour (kWh), higher than the estimated 0.1–0.7¢ per kWh for fossil fuels,” writes Tagwerker. “If externalities were included, however, estimates indicate fossil fuels would cost 23.8¢ more per kWh, while renewables would cost around 0.5¢ more per kWh.”
A recent report by the International Monetary Fund (IMF) took a unique approach to subsidy calculations, lumping them into pre-tax and post-tax groupings rather than production and consumption.
The IMF then tacked on a modest $25-per-ton carbon tax to capture the external costs of climate pollution. After tallying up all the various subsidies, the IMF came up with a whopping $1.9 trillion every year, or roughly 2.5-percent of the global GDP in 2012.
Finally, Tagwerker considers the entire subsidy through the lens of climate pollution. “From an emissions perspective, 15 percent of global carbon dioxide emissions receive $110 per ton in support, while only 8 percent are subject to a carbon price, effectively nullifying carbon market contributions as a measure to reduce emissions.”
Image Credit: Subsidies via Shutterstock.
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