Tuesday, 1 December 2015

Quotes of the Day: On those alleged fossil-fuel ‘subsidies’

“…a tax reduction is NOT a subsidy.”
~ Bob Shapiro, ‘Toward a Sane US Energy Policy

“Does it makes sense to refer to our failure to enact carbon taxes and the like as a ‘subsidy’? … When headlines claim that ‘The world is spending $5.3 trillion on fossil fuel subsidies,’ many people might think that this money is somehow going directly to oil, gas, and coal companies. I suspect they don't read that sentence as ‘The world should raise energy taxes by $5.3 trillion to account for the [alleged] damages caused by fossil fuels.’ But the latter is basically what is meant.”
~ Brad Plumer, The IMF says we spend $5.3 trillion a year on fossil fuel subsidies. How is that possible?

“But as pointed out by less gullible and self-interested commentators, the “subsidy” is not what it seems – 40 per cent is due to road accidents and the like, which oil is said to cause; 25 per cent is due to fossil fuels causing global warming; another swag is due to the authors’ view that taxes are too low anyway!”
~ Alan Moran, ‘Anti-fossil fuels agitprop may harm Australia

“The reason subsidies persist is that people don’t understand the sorts of things that are classified as subsidies. They think of them as cash payments from the government to oil companies. In reality, most are things like assistance for low income households so they don’t freeze to death in the winter…. ‘The ‘subsidies’ we give fossil energy companies are a rounding error relative to the subsidies fossil energy give to society’.”
~ Robert Rapier & Nate Hagens, ‘How Fossil Fuels Subsidise Us

We get large value in return for [these mis-named] fossil fuel subsidies, whereas for solar and wind subsidies we get almost nothing. Per kilowatt-hour (kWh) of energy produced from solar and wind, there is a[an actual] subsidy to the producers of about two cents/kWh. Since base electric price in the US is around 8-10 cents per kilowatt-hour, that’s about a 20% subsidy.
    “The [alleged] subsidy for oil, on the other hand, is about a hundredth of one cent per kWh, coal is about two hundredths of a cent per kWh, and nuclear is about eight hundredths of a cent per kWh.
    “Why the huge disparity? It’s because solar and wind don’t produce economically, so they have to be artificially propped up…”
~ Willis Eschenbach, ‘The Hood Robin Syndrome

“Many Australians enjoy receiving their annual tax refund. Having over-paid tax during the year, the Australian Tax Office sends them a cheque. Nobody thinks this is a subsidy; if the government were to propose to simply pocket that money, everyone would clearly see this as constituting an increase in taxation.”
~ Sinclair Davidson, ‘Diesel rebate is not a subsidy

“Not all of what they describe as subsidies is a subsidy in the normal meaning of the word. Nor is everything they do count a subsidy even in their expansive sense to the energy system. And almost all of what they describe is in fact a subsidy to energy consumers, not to energy producers. And finally it’s most certainly not all a subsidy to fossil fuels or fossil fuels use. The way they’re counting things the renewables industry is also getting a very much larger subsidy than we normally calculate it does.”
~ Tim Worstall, ‘IMF Report On $5.3 Trillion In Energy Subsidies; Careful, It's Not Quite What You Think

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