The late economist Milton Friedman famously declared that “nothing is so permanent as a temporary government program.”
Friedman’s line comes to mind because a lobbying frenzy is underway in Washington, DC. Some of the city’s most powerful special interests are working to prevent a repeal or reduction of the lavish energy-related tax credits in the Inflation Reduction Act. No lobby group is working harder than the American Clean Power Association.
Why is the ACPA pushing so hard? The answer is simple: Its members have collected tens of billions of dollars in federal subsidies, loans, and loan guarantees over the past few years to install solar energy, wind energy, batteries, and other forms of alt-energy, and they don’t want that geyser of federal money to stop. As the Wall Street Journal noted in a recent editorial, “Republicans for the Green New Deal,” thanks to the IRA’s expansion of the investment tax credit (ITC) and production tax credit (PTC), solar and wind developers can “offset as much as 70% to 80% of their costs.” Given that giveaway, it’s no surprise that the ACPA and its members are spending millions of dollars to persuade Congress — and in particular, Republican members of the House of Representatives — to keep the corporate cash flowing.
According to Subsidy Tracker, an excellent database maintained by one of my favorite NGOs, Good Jobs First (annual revenue: $1.9 million), the companies now on ACPA’s board of directors have collected $47 billion in subsidies, loans, and loan guarantees. Most of that sum has been collected over the past decade or so. But that figure represents only a fraction of the public money that the group’s members have vacuumed up over the past few years. Furthermore, and perhaps most galling, is this: About a third of that $47 billion is going to foreign corporations, including companies like Iberdrola, Shell, and Equinor.
Why does this matter? First and foremost, the ITC and PTC are, to use the title of Meredith Angwin’s excellent 2020 book, shorting the grid. The massive subsidies for weather-dependent forms of generation are distorting electricity markets and contributing to the premature closure of the thermal plants needed to assure the affordability, reliability, and resilience of our electric grid.
Second, these subsidies are fueling the landscape-wrecking, bird-and-bat killing, property-value-destroying energy sprawl that comes with the expansion of Big Solar and Big Wind. They are also fueling the insane expansion of offshore wind energy into the known habitat of the critically endangered North Atlantic Right Whale and other marine mammals.
Read the rest of this piece at Robert Bryce Substack.
Robert Bryce is a Texas-based author, journalist, film producer, and podcaster. His articles have appeared in a myriad of publications including the Wall Street Journal, New York Times, Forbes, Time, Austin Chronicle, and Sydney Morning Herald.
Photo: Windtech via Wikimedia under CC 3.0 License.
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