Wednesday, September 28, 2011
Energy green as cash
Nice post on Marginal Revolution today by Alex Tabarrok on the crazy subsidies for green energy. Recognizing the externalities, it makes good sense to support wind farms and other green sources of energy, but it's entirely possible to go too far, as Spain did a few years ago. The current programs supporting energy make it possible for someone to build a wind farm by putting up only about 10% of the costs, since the government will fund the rest to the tune of billions of dollars. That just can't be the best use of government money! How about some feed-in tariffs like we heard about earlier? It's one thing to be supporting green energy, but it's another to be building wind farms for people and giving them the profits from operating the farms. This process needs to be improved. I'll see if I can talk to a friend who works down at the DOE to see if she or a colleague can come talk to us about it.