Should the government subsidize renewable energy?
One way to combat climate change that has been promoted in the last few decades is renewable energy - and while many believe that the government should subsidize it, others fear that the costs of such a move far outweigh the benefits.
Rise of the Issue
With the effects of climate change becoming more and more visible each day, people are looking for ways to combat global warming. As non-renewable energy sources have been shown to be a major contributing factor to emissions that are causing climate change, many have argued for a switch to cleaner energy sources, such as renewable energy. Yet, the subsidies to promote renewable energy remain a topic of discussion.
While one side believes it is a necessary investment and would help level the playing field since fossil fuels have been benefiting from subsidies for decades, the other side says the government should not interfere in the free market and that the renewable energy industry has been around long enough to be able to compete.
Issue Timeline
1789
US Government Implements First Energy “Subsidy”
Leaders of the newly established United States put a tariff on the sale of British coal shipped into United States ports, effectively subsidizing energy produced in the United States.
1916
Intangible Drilling Costs are Introduced
These tax breaks allow companies to deduct most of the costs of drilling new wells in the United States.
1946
Congress Passes Atomic Energy Act
The bill promoted development of atomic capabilities to improve public welfare, increase the standard of living and strengthen free competition and invested in nuclear reactors and high energy accelerators.
1992
Congress Passes Energy Policy Act
The legislation encouraged the use of alternative fuels to reduce America’s dependence on petroleum and improve air quality.
2009
Congress Passes American Recovery and Reinvestment Act
Through the act, the Energy Department invested more than $31 billion dollars to support a wide range of clean energy projects - from helping homeowners and businesses with energy efficiency upgrades to developing alternative fuels.
Micro Issues
A.
Climate Change
The two sides differ on whether an increased use of renewable energy will be a large component of combatting the effects of climate change.
B.
Free Market
Opponents feel subsidies for renewable energy would interfere too much with market forces, while supporters believe the advantages of renewable energy are a good reason to interfere in the free market.
C.
Consumer Costs
Supporters say subsidies for renewable energy could help lower the rising energy costs for consumers, while opponents point out that federal subsidies have not lowered consumer costs thus far.
Pro Arguments
1.
Renewable energy is better for the environment.
Energy from renewable sources produces far less greenhouse gasses and pollution than non-renewable energy sources.
2.
Renewable energy is an infinite resource.
Non-renewable energy comes from sources that may not be replenished in our lifetimes, while renewable energy will not run out.
3.
Subsidies for renewable energy would create a more level playing field.
Non-renewable energy sources have been benefiting from subsidies for decades, putting renewable energy at a disadvantage.
4.
It helps accelerate the growth of renewable energy.
Subsidies will help energy providers invest in renewable energy and help curb the costs of generating renewable energy in the future.
5.
Subsidies help bring down consumer costs.
If renewable energy is subsidized, energy providers can charge less and still make a profit, decreasing the cost of renewable energy for consumers.
Con Arguments
1.
Generating renewable energy is not always environmentally friendly.
Although the power it produces is better for the environment, there are other ways in which it can be negative for the environment, for example if building facilities means flooding land or damming rivers.
2.
Subsidies interfere with the free market.
Subsidies influence market prices by giving the receivers an inherent advantage that is not based on demand and supply.
3.
Some of the subsidies end up overseas.
Much of the wind and solar power used in the United States is owned by foreign companies, and the subsidies go to international corporations.
4.
Subsidies for renewable energy have not lowered consumer costs.
While subsidies have lowered out-of-pocket costs for renewable energy providers, this has not always translated into lower consumer costs.
5.
Renewable energy sources do not operate on-demand.
Because renewable energy is based on the presence of matters such as wind or sunshine, they are considered less reliable than non-renewable sources.