It seems every candidate has his favorite energy subsidy. Or two.
Sen. Barack Obama (D-Ill.) has favored setting a minimum goal of 60 billion gallons for ethanol of all kinds, derived from corn and cellulosic materials such as grasses or wood chips. That's twice the current target for an industry which has thrived largely because of federal mandates and subsidies for refiners that blend ethanol into motor fuel.
Sen. John McCain (R-Ariz.) has opposed subsidies for ethanol. And last Tuesday he attacked Obama for voting for the 2005 energy bill (widely supported by Republicans) because, McCain said, it had subsidies for big oil and gas companies.
But McCain made those comments during a campaign event at a nuclear power plant. McCain says he would like to see an additional 45 nuclear plants built in the United States. The problem: The nuclear industry says it needs big federal subsidies before it can build even one. Without federal loan guarantees to help utilities or merchant power firms borrow money, it's unlikely that any bank will provide the financing necessary to build a new nuclear power plant. The possibility of cost overruns, regulatory issues and a drop in electricity demand are too great given the long time it takes to actually propose, build and connect a nuclear unit. Billions of dollars have been approved so far for nuclear plant loan guarantees, but the industry says that that money will cover, at most, a handful of plants -- and it wants more.
McCain also favors tax credits for low emission automobiles, such as electric vehicles. That is a subsidy too, but at least it's one on which the two candidates agree. Obama favors a generous electric car tax credit.
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Comments (7)
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August 17, 2008 8:13 PM | Report Offensive Comment
Posted on August 17, 2008 20:13
How about this for size: home owners get tax breaks for installing solar/wind generators. They support themselves, and all the power companies have to do in the end is provide service, maintenance, and r&d.
Yes, we will still be paying the power company, rather than the power company paying those that feed the grid instead of leech the grid. And? No more brown outs, black outs, energy crises.
Why is it that everyone wants to place blame here, there, everywhere but never take responsibility to fix it? Who cares about the fault, just FIX IT. Then move on to a better world that doesn't have to worry about nuclear waste, etc.
August 12, 2008 2:40 PM | Report Offensive Comment
Posted on August 12, 2008 14:40
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August 12, 2008 12:55 PM | Report Offensive Comment
Posted on August 12, 2008 12:55
At least with tax credits (e.g. current ones for conservation, solar, etc.), the recipient has to have made a purchase and installation of the product before qualifying for the credit. So there's money flowing through our economy, for goods and services, before there's a cost to the Fed. And the cost is not a direct pay-out by the Fed, but reduced tax revenue, calculated as a percentage of the recipient's purchase/installation costs.
August 12, 2008 12:54 PM | Report Offensive Comment
Posted on August 12, 2008 12:54
We need to implement an energy mix for the future that works economically in the sense that it provides energy in quantities and forms sufficient to power our economy and to keep the energy supply system going. If it takes subsidies, and on top of that, if it takes measures to keep the competition at bay, the end result will be well worth it. More than worth it, as failure to get us off fossil fuels in time would constitute the end of our modern civilization upon which we have come to depend so heavily.
So far, I don't see much evidence that we are working on solving the long-term energy supply problem at all.
August 12, 2008 11:34 AM | Report Offensive Comment
Posted on August 12, 2008 11:34
The nuclear power industry has refused to go out build without huge subsidies. Then there is that thing about contamination and how to dispose of it. Nevada doesn't want it.
The alternative to all this is industrial hemp. Ralph Nader addressed it the other day at a news conference. He believes that we should be using it and that it could indeed replace fossil fuels. It's a wonderous plant that can be used for many things, most notably oil.
It doesn't matter which way we go, there will be subsidies. Big oil is the biggest receiver of subsidies, welfare and tax breaks in the world. At least with hemp it would home grown all the way.
August 11, 2008 2:37 PM | Report Offensive Comment
Posted on August 11, 2008 14:37
Utility companies want federal loan guarantees tied to project financing for nuclear power plants in order to shift all the risk to the taxpayers. They are well able to get the loans on their own. Agreed, the banks won't give them project financing backed by the nuclear plant and its revenues, but these utilities are large enough corporations that they can certainly get the loans using their corporate equity as the collateral and backing the loans with their full cash flow from their existing plants, plus the nuclear plant, plus their power distribution system.
August 11, 2008 1:37 PM | Report Offensive Comment
Posted on August 11, 2008 13:37