By Stephen Lacey
Greentech Media
Let’s start out with a fact: the free market for energy is a myth.
Every country uses subsidies in some way to encourage production and dictate consumption of different forms of energy. According to the International Monetary Fund, global post-tax subsidies for fossil fuels (which includes the external costs of pollution) amounted to $1.9 trillion in 2011. And IMF said that figure is an “underestimate.” The IEA also estimates that global consumption subsidies for fossil fuels reached $523 billion in 2011.
Here in the U.S., the government practically gives away taxpayer-owned coal to mining companies. It provides billions of dollars to the oil and gas industry in the form of preferential tax treatment. And the fracking boom, which is often held up as a shining example of the free market, was spurred by strong R&D funding, government cost-sharing programs, and tax credits that helped an unproven technology reach wildly successful commercial scale.
And now, of course, we have billions of dollars in specialized tax subsidies, rebates, certificate trading programs and utility programs like net metering to encourage the production of renewable energy.
