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Alternative Energy Subsidies

[ 28 ] January 29, 2012 |

If there’s one thing more frustrating to environmentalists than the reluctance of the government to subsidize clean energy production, I don’t know what it is. Not only is it central to any reasonable plan for fighting climate change, but it just makes sense on so many levels. Subsidies have brought the prices of renewables nearly to that of dirty energy and it is falling all the time. And of course, the government subsidizes the heck out of fossil fuel production in ways both direct and indirect. The federal government made its decision to go all the way with the fossil fuel industry in the 1950s (if not before) and that might have made sense at the time. That it doesn’t see the future today and continues to favor dirty energy over clean hugely hampers America’s future. Future leading nations will have access to renewable energy and affordable prices with governments building connections between industry and itself to press for national growth. The U.S. remains stuck on an antiquated model.

On top of that, it continually amazes me that petroleum companies don’t rethink themselves energy companies and get behind renewables with all their capital. Money is money. Renewables are the future. Make them profitable. Does it really matter whether you are burning fossils or channeling the sun’s energy? Some oil people like T. Boone Pickens get this. Most do not. Insane for future corporate bottom lines, the future of people on this planet, and our national interest.

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  1. Incontinentia Buttocks says:

    Cue trolls shouting “Solyndra” in 5, 4, 3, 2, 1…

    • R Johnston says:

      People who shout “Solyndra” are primarily idiots, not trolls. It’s kinda like shouting about how we need a return to the gold standard or about the evils of fluoride in the water. Sure, there may be a troll element, but the smart trolls take less ridiculous angles.

      • Incontinentia Buttocks says:

        Trolls and idiots are, of course, not mutually exclusive categories. And, sad to say, the idiots who shout “Solyndra,” unlike the idiots who support the gold standard, are the current mainstream of the GOP and will have a big say on clean energy policies going forward.

  2. Mudge says:

    Let’s go back a few years and ask the question why American steel manufacturers didn’t modernize to cut cost. Let’s ask why Kodak didn’t invest in digital imaging. Industry doesn’t invest in radical changes. They are run by conservative marketing wimps and accountants. They die and are replaced. They almost always have.

    You’re question implies business has had an epiphany. It hasn’t.

  3. Stag Party Palin says:

    Let’s ask why Kodak didn’t invest in digital imaging.

    They *did* – they were pioneers in digital imaging. Unfortunately they got their butts kicked in the process.

    • Mudge says:

      Their butts were kicked because they never really made the commitment..they invested in an instant camera to compete with Polaroid. I worked there in the late 70s. Patents come from researchers, they had some good ones. They developed patents. Products come from a commitment to engineering and marketing, using the patent to create a product, they had none of that.

    • BigHank53 says:

      Kodak more or less invented digital imaging. Upper management decided to sell it off because they felt it would cut into their largest revenue stream–film sales.

  4. Mark says:

    The average CEO of a publicly-traded company doesn’t care about the “future corporate bottom line.” They care about what the stock price does over the next quarter, maybe the next year. Once the effects of today’s shortsighted decisions are felt, investors will not remember those decisions, and chances are the CEO will have cashed in his or her stock options, taken some crazy severance package, and moved on.

  5. Icarus Wright says:

    Please edit this article.

    The federal government may its decision to go all the way with the fossil fuel industry in the 1950s (if not before) and that might have made sense at the time.

    On top of that, it continually amazes me that petroleum chemicals don’t rethink themselves energy companies and get behind renewables with all their capital.

    I’ve been seeing a lot of this lately on multiple blogs and it’s driving me absolutely batshit insane.

  6. Manju says:

    Obviously I live in an alternate-reality where liberals made Robert Byrd their Senate Majority Leader while he was still an unrepentant segregationist, but I ain’t feeling this post either.

    I’ve pitched Dow Chemical and Dupont on a new battery chemistry. Dow dropped about 15 people in on the first meeting. Dupont has a Venture Capital arm and actually became part of the syndicate. I’ve heard Venture Capitalists complain that there is too much government money in the system, and all the private money is just on the sidelines waiting to see where the government ones go.

    Green energy is a juggernaut. Can’t be stopped. Buffet, Gates, Soros, Goldman, Kleiner, Khosla, etc are loaded up. And it’s not just the Davos crowd. Every other good ‘ol boy PE energy firm in Texas is on the bandwagon.

    Sure, there are holdouts. And maybe the majority of Chemical companies are in that group. But who cares? Draper Fisher openly looks for industries dominated by stale players, so they can crush them with a leapfrog game changer.

    Now, this sort of creative destruction has proven to be much more difficult in cleantech than it was in IT. Cleantech is really the energy business and it demands much more money as well as much more government cooperation. But every major government is subsidizing these alt-energy start-ups. China has 110 billion dollar fund and Obama jump-started the industry through the stimulus.

    And a lot of money goes thru the dept of defense and the CIA. EVs are silent and that’s great if you don’t want the enemy to hear you while you invade their country. The CIA is developing predator drones the size of a bug now. The batteries that power them could have the power to weight ratio necessary to make EVs viable.

    The Koch bros have about a good a chance of winning this as Ed does the White House. Even Dubai and the UAE are in big. They’re the biggest investor in Fisker auto. Fuggettaboutit. Don’t Worry. Be happy.

    • Erik Loomis says:

      Robert Byrd’s KKK membership in 1945 is the precise reason why we can’t commit to renewable energy subsidies. How did I not see this before!

    • Murc says:

      The CIA is developing predator drones the size of a bug now.

      … to what end?

      Even assuming this isn’t a fevered imagining, a drone the size of a bug would be kind of useless as a Predator-style drone, wouldn’t it? If you want to do battlefield surveillance, there are methods that are equally as undetectable and probably far, far cheaper than your hypothetical bug-sized drone, and the whole point of a Predator is that not only is it a surveillance platform, its 1) armed, and 2) reusable. I don’t think we can mount missiles or a cannon on something the size of a bug.

      • Manju says:

        Surveillance. The ability to fly undetected, even into a residence.

        I don’t know how they would be weaponed, so perhaps UAV is a better term than predator, but I gather they can be designed to carry out targeted killings. Then again, in the Venture Industry, you hear all sorts of crazy ideas that never come to fruition

        I do know they (CIA’s VC fund and the Dept of defense) were pushing this angle very hard in regards to financing new battery technology. It had to be nanotech applicable to UAVs.

    • wengler says:

      This is some crazy, disjointed shit here.

  7. David Kaib says:

    Does it really matter whether you are burning fossils or channeling the sun’s energy?

    It does – one concentrates power in the hands of a few, the other holds out the possibility of democratizing energy, and therefore power. As for the long run, I agree with those who said management isn’t running a corporation for the long run – their incentives are to get as much money as possible in the short run.

    It seems obvious that the energy companies aren’t interested in taking this path, and that the federal government isn’t going to make a major change either. But what about states? TX isn’t going to take the lead, certainly. But there are other states that lack a significant fossil fuel sector. Most could use some job creation. (And I would think this could be paid for through a state development bank). If some of those could take the lead, create some real alternatives, it could create some power for challenging the energy companies. If nothing else, it would show that another world is possible. And that is no small thing.

    • Erik Loomis says:

      Here’s the thing though–when I was driving around west Texas in 2007, there were hardly any turbines. By 2009, it was a huge wind farm. The change was jaw-dropping. Someone was taking the lead. And there’s so much more potential.

      Interesting point on solar being democratic; surely there must be a way for capitalists to monopolize the sun……

      • David Kaib says:

        I’m sure they can too (sadly) – it’s a matter of degree. My sense is that the big energy companies and politicians realize they have to make some effort here. In the DC metro area, commercials touting oil companies as public and environmentally spirited are quite common (not sure if the rest of you are subject to them). As you said, these changes are happening – it’s overly simplistic to pretend they aren’t doing anything or there is no action. It’s just not enough.

        My pipe dream is that people around the world would work together in an open source style way to find technological solutions to our energy needs that are 1) green 2) cheap and 3) democratic. Not me, people who understand physics and stuff. But the power dynamic has to be part of that conversation.

      • J. Dunn says:

        surely there must be a way for capitalists to monopolize the sun……

      • ajay says:

        surely there must be a way for capitalists to monopolize the sun……

        It’s called “modern farming”.

      • Jeremy says:

        You should know this, Erik. After innovation, companies then lobby government for regulation to strangle the little guys. Once they get solar farms good enough to turn a profit, we’ll see home panels outlawed for some silly reason, like they might blind pilots and cause plane crashes.

  8. Evan Harper says:

    Alternative energy subsidies would be good. Slashing fossil fuel subsidies, or taxing carbon emissions at the source — fossil fuel production — would be even better if possible.

    • DocAmazing says:

      Expect a deafening whining from the motorists who refuse to take the bus or ride bikes if you even think of raising the price of gas.

      • Jeremy says:

        I went home for Christmas and was shocked at the difference in gas prices over the past 8 years or so. When I left, it was still around $1.20/gallon.

        My folks have felt the pinch enough that they carshare a fair bit and plan out their shopping routes ahead of time. My high school friends, on the other hand, still seem to have no problem driving all over Indianapolis and the surrounding suburbs. I wonder sometimes if that’s where all their disposable income has gone.

  9. wengler says:

    T. Boone Pickens made that industrial wind farm as part of a PR campaign to promote what he really believes in- natural gas. When he couldn’t hook it up to the grid, he shrugged his shoulders and secretly laughed.

    Rule #1 in life: Never, ever trust an oil man.

  10. Honorable Bob says:

    If there’s one thing more frustrating to environmentalists than the reluctance of the government to subsidize clean energy production…

    Whoa, there, Li’l Buckaroo….in an earlier thread about capital gains taxes you stated that taxes really didn’t matter and that investors would invest anyway as if investors didn’t base their behavior on after-tax real returns.

    Now, you seem to be championing government assistance to the “green” companies to improve their attactiveness to investors….

    Which way is it, Erik?

    Pick one and stick to it.

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