Policy Documents

Setting the Record Straight on Renewable Energy Subsidies

Bill Peacock –
March 5, 2013

In the past, because wind (and other renewable sources) is a pollution-free but new way of generating electricity, policymakers decided it should receive subsidies so that it can one day displace electricity from pollution-generating fuels. Now, because of renewable energy subsidies, 1) we have to keep turbines using pollution-generating fuels sitting on idle in case the wind stops blowing—or the sun stops shining, etc., and 2) we may have to spend billions of dollars in additional subsidies to ensure that the owners of plants using pollution-generating fuels build enough new plants to supply us with enough electricity to keep the lights on. Going forward, wind power is still not a “mature” technology—despite the fact that it has been in use for thousands of years—and so it must continue to receive subsidies that may in turn mean more subsidies for conventional fuels.