The U.S. Government Subsidizes Every Type of Electricity

From the Wall Street Journal:

Some clarity comes from the U.S. Energy Information Administration (EIA), an independent federal agency that tried to quantify government spending on energy production in 2007. The agency reports that the total taxpayer bill was $16.6 billion in direct subsidies, tax breaks, loan guarantees and the like. That's double in real dollars from eight years earlier, as you'd expect given all the money Congress is throwing at "renewables." Even more subsidies are set to pass this year.

An even better way to tell the story is by how much taxpayer money is dispensed per unit of energy, so the costs are standardized. For electricity generation, the EIA concludes that solar energy is subsidized to the tune of $24.34 per megawatt hour, wind $23.37 and "clean coal" $29.81. By contrast, normal coal receives 44 cents, natural gas a mere quarter, hydroelectric about 67 cents and nuclear power $1.59.

Detractors of gas taxes and the Pigou Club like to frame the debate as being between a laissez-faire status quo and a group of people who want more government intervention in the economy. See here for an example.

So we are left to believe that financing government spending through relatively economically benign externality taxes is interventionist but having one of the highest corporate income tax rates in the world then giving that tax money back to corporations in the form of subsidies is the antithesis of government intrusion.