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by ZeroGravitas 3967 days ago
Yes, people should pay more for electricity that is generated by heavily polluting sources like coal and gas, since if they don't pay directly, they pay indirectly for health care etc.

The obvious, standard, free market answer to this (which it seems you'd be in favor of given the political elements of your argument) is some kind of carbon tax. With externalities accounted for wind and solar are the obvious market choices for new generation capacity (and efficiency is rewarded with correct prices too). They're often the best choice now even without this market correction, and continually drop in price to make this more common. That's why we're at some kind of tipping point and the old vested interests realise they're in danger.

(Note in actual implementations of this they often either return the money raised directly to consumers, or cut other taxes to compensate, so you pay more for some things, but still come out aheadahead overall).

You can see Elon Musk sigh every time he mentions this as it's so obviously the right answer, but politically toxic in the US, for no logical reason, despite it being the market friendly, small government answer. A tax specifically designed to phase itself out over time. Instead we've got a strange web of government subsidies and regulations because the democrats like those kind of thing, and the libertarian side of things has been bought off by the vested interests.

1 comments

I see your points and agree a carbon tax is the most market friendly way to account for environmental externalities. However, my main point is that wind and solar are NOT economically viable despite what Elon and every other silicon valley expert seems to believe. Even with carbon taxes priced in they can't match the price of natural gas and coal. The reason is that they are not reliable sources of energy and with both of them you need batteries of some other type of storage to smooth out production. This essentially doubles the costs. Everything you read about the 'cost' of solar and wind doesn't take into account storage or the overbuild required to have backup power for cloudy days. The type of grid that uses 100% solar/wind would be a completely unreliable grid and cost considerable more for everyone. Solar and wind aren't being adopted because they are worse for consumers, not because some cabal of special interests are keeping them out.

In fact the opposite is true. The only reason solar is being adopted at all in almost every region in the world is because of government subsidies.

(Source: I build solar and wind farms for a living).