OPINION:
For many reasons, I am generally against the government picking winners and losers in the economy by offering special tax advantages and other benefits to certain industries.
For several decades now, the federal government has offered all kinds of tax breaks and other economic incentives in its grandiose effort to make so-called renewable energy affordable and reliable.
The Environmental Protection Agency said the voluntary green power market in the U.S. emerged with the advent of the investment tax credit for alternative energy sources in 1978. The EPA has fastidiously documented many other “milestones” ever since.
Throughout the years, laws have vastly increased the size and scope of the tax subsidies for alternative energy, namely for wind and solar.
The left-leaning Tax Policy Center said, “The federal government provides roughly $96.7 billion per year in tax subsidies that encourage non-fossil fuels.”
In 2022, President Biden signed the Inflation Reduction Act, which shoveled hundreds of billions of taxpayer dollars into the hands of green energy CEOs and wealthy Americans who can afford to buy expensive electric vehicles.
For a thorough analysis of the green subsidies in the Inflation Reduction Act, I highly recommend the report “The High Costs of Climate Scams: Assessing the Green Giveaways in the Inflation Reduction Act,” by my colleague Tim Benson at The Heartland Institute.
As Mr. Benson notes, “After its enactment into law, Biden acknowledged the IRA had ‘nothing to do with inflation.’ Rather, the green subsidies contained in the bill, which the Biden administration said would total $369 billion, amounted to what they described as ‘the most significant action … taken on clean energy and climate change in the nation’s history.’ Since then, however, the price tag on these tax credits has increased substantially, with a wide range of predictions for how much they will ultimately cost. All credible estimates are significantly more than the Biden administration initially claimed, including one that puts the actual cost as high as $1.8 trillion.”
It also bears mention that wind, solar and other so-called green energy sources are not “green” at all. In fact, the evidence shows that wind and solar wreak environmental destruction from the beginning of their manufacturing process until they rust and become useless. Even worse, the industry is rife with slave and child labor.
Did you know, for example, that children as young as 5 in Congo typically perform the mining process for the rare earth elements necessary to produce windmills, solar panels and EV batteries? Even NPR acknowledges this is indeed taking place.
It is also true that the environmental footprint for massive fields of windmills and solar panels directly causes profound and long-lasting environmental degradation to large swaths of productive farmlands and natural habitats. Let’s not overlook the fact that onshore windmills kill millions of birds and offshore wind turbines in the Atlantic Ocean off the East Coast are killing endangered whales.
Despite the trillions of dollars “invested” in green energy over the past four decades, when it comes to affordability and reliability, although progress has been made, it is an unequivocal fact that fossil fuel power sources are still by far the most dependable and inexpensive.
Now, I am not arguing against green energy. If the technology that makes renewable energy reliable and affordable at scale arises, that would be a wonderful achievement. However, we are far from that point.
Prematurely relying on wind and solar power to deliver constant energy to millions of people and businesses without interruption is an unwise decision. The events in Western Europe a few weeks ago demonstrated the peril of betting too soon on solar power.
This fundamental flaw, the intrinsic intermittency of wind and solar energy, means forcing a green energy transition would be incredibly foolish. The need for abundant, affordable and reliable energy is increasing substantially amid the growth of artificial intelligence, quantum computing and other technological advancements.
In the coming years, the United States must ensure that the national energy grid is as robust as possible as we enter the era of AI. Huge data centers will require more and more baseload power.
At best, the good intentions of nearly 50 years of subsidizing green energy have not produced viable high-tech solutions to keep throwing good money after bad. At worst, nearly a half century of this malinvestment has enriched a few and resulted in trillions of dollars in waste and opportunity cost.
• Chris Talgo (ctalgo@heartland.org) is editorial director at The Heartland Institute.
Please read our comment policy before commenting.