“The PTC is the single most expensive energy subsidy in the federal tax code and is estimated to cost taxpayers about $40 billion from 2018 to 2027.” (IER, January 5, 2021)
“Special government favor to business–crony capitalism–can turn losers into winners. And the loser lobby can claim progress and even inevitability as if they really won. This is the postmodernism of energy policy today in regard to the two politically correct renewables: wind and (on-grid) solar.”
It does not end. What is not competitive and government dependent just continues that way. This is not only because the market picks winners and leaves the losers for politics. It is also because the market-driven, non-subsidized technology improves over time.
Recently, wind power federal Production Tax Credit received its 13th extension. Reported IER:
The U.S. Congress recently passed a massive spending bill that includes $35 billion in energy research and development programs, a two-year extension of the Investment Tax Credit for solar power, a one-year extension of the Production Tax Credit for wind power, and an extension through 2025 for offshore wind tax credits.
These energy provisions are included in a $1.4 trillion federal spending and tax extension package…. Despite billions of dollars in subsidies and state mandates requiring them, wind and solar power provided less than 10 percent of the nation’s electricity in 2019.
In comparison to the puny government tax favors to oil and gas in electrical generation,
Between 2010 and 2019, the American solar industry got roughly 211 times as much in federal tax incentives as the oil and gas sector, when compared by the amount of electricity produced. And the wind sector received 48 times as much as the oil and gas sector.
Special government favor to business–crony capitalism–can turn losers into winners. And the loser lobby can claim progress and even inevitability as if they really won. This is the postmodernism of energy policy today in regard to the two politically correct renewables: wind and (on-grid) solar.
Appendix: PTC Creation & Extensions
NOTE: The Inflation Reduction Act provided the 14th extension in 2022 for three years. See comment below.
Thanks, Mr. Bradley. Great overview of utter waste, and enormity of the problem. As they say, watch the Germans. Examples in the extreme. “Cut subsidies to wind and solar and their ‘industries’ disappear in a heartbeat. Across Europe the subsidies have been slashed and so too has wind power investment and thousands of groovy ‘green’ jobs. Twelve countries in the European Union (EU) failed to install “a single wind turbine” last year.”
That would be as of August, 2019.
Now I guess we wait for the Biden Shoe to drop.
More “renewables” of wind and solar…in support of biodiversity. Uh huh.
Yeah that cow is going dry. Time for a new one? Hydrogen maybe?
By 2030, small modular reactors (SMRs) from 3 manufacturers will be operational – GE Hitachi; NuScale; Rolls-Royce.
Leading the charge of these advanced SMRs, is GE Hitachi’s, passively safe BWRX-300. The build of the first of these 300 MW nuclear power plants (NPPs) starts in 2024, to commence operation in the USA in 2027. The second one will be operational in Canada in 2028; Fermi Energia, an energy provider in Estonia will be operating one this decade; Michal Solowow, a Polish industrialist will be ‘buying’ one to be operational this decade, to supply his energy-intensive businesses and ‘green’ his image.
The BWRX-300 small modular reactor (SMR) has a 26 month build programme, which is no different to that of wind and solar plants (WASPs). The cost-of-capital burden, which has been a prime factor in draining investment from NPPs into WASPs over the past 3 or 4 decades, is utterly negated. That’s why Michal Solowow ‘gets it’. Commercial capital, without any form of Government intervention or subsidies of any kind, will reap rich rewards – multiple times the earnings of any investment associated with wind and solar plants (WASPs).
This analysis of a South Australian utility scale solar plant will not be too dissimilar the anything in California, in terms of performance and subsidies:
A$1.73 billion went into Robertstown Solar project and its operators will be able to sell 31 million MWh of intermittent electricity over its lifespan. $875 million will ‘buy’ lucky Australian entrepreneurs a BWRX-300, which will allow them to sell 142 million MWh of 24/7 electricity. It is an utter no-brainer.
Energy-inept politicians in capitalist-economy nations, committed to low-carbon targets, have been completely suckered by the WASP NGOs, and lobbyists into a ragbag mess of subsidies and payment schemes beyond comprehension. And the driving force behind the grotesque situations that nations and regions with high WASP penetration find themselves in – simple! The power of commercial money!
[Warren] Buffet told an audience in Omaha, Nebraska recently. “For example, on wind energy, we get a tax credit if we build a lot of wind farms. That’s the only reason to build them. They don’t make sense without the tax credit.”
And that’s why, come 2030, when Australia’s green fund and green bank managers see the light, they will be clawing at one another’s throats to get their pots out of WASPs and into advanced NPPs. They’ll twist the screw on their political puppets and have the law banning NPPs in Australia rescinded in quick time.
Then each $1.00 invested in a BWRX-300 will be earning at least 17X more than $1.00 of the $1.73 billion invested in Robertstown Solar Project!
https://bwrx-300-nuclear-uk.blogspot.com/2020/05/fund-managers-with-a173-billion-to.html
While Congress continues to pass Production Tax Credit extensions for offshore wind energy, the US Department of Energy reports through the February 2019 Energy Information Administration Annual Energy Outlook 2020 Report, that the total economic costs of offshore wind resources will be three times larger than any corresponding economic benefits. As such, the more offshore wind that is added to the electric supply system the greater will be the net economic cost to society.
Warren Buffet’s comment reinforces my impression that the wind production tax credit transfers wealth from the poor and middle class to the rich. Is Biden unwittingly supporting the plutocrats?
The 14th extension was enacted in the (so-called) Inflation Reduction Act of 2022. The extension is through 2025.
https://www.epa.gov/green-power-markets/summary-inflation-reduction-act-provisions-related-renewable-energy#ITCPTC
“Through at least 2025, the Inflation Reduction Act extends the Investment Tax Credit (ITC) of 30% and Production Tax Credit (PTC) of $0.0275/kWh (2023 value), as long as projects meet prevailing wage & apprenticeship requirements for projects over 1 MW AC.”