Bruce Poliquin defies logic in his Dec. 8 op-ed calling for “affordable, reliable energy” for Mainers. He recognizes Mainers’ environmentalism; he rightly recommends energy policy that encourages all sources in light of relative costs, and he objects to welfare spending. Yet his inaction would preserve the “corporate” welfare program that offers massive subsidies to the fossil fuel industry and destroys our environment.
Poliquin wrongly confuses price with cost. Government subsidies make a product inexpensive for consumers.
Such subsidies hide true costs, which cannot be avoided. The fossil fuel industry receives not only direct subsidies through tax write-offs but also much larger implicit subsidies, because they are not charged for their polluting activities. Each ton of carbon dioxide emitted by burning fossil fuels causes future damages from adverse climate of at least $50. Consequent damages from air pollution and ocean acidification add significantly more.
Poliquin’s call for “affordable” energy ignores these costs to favor fossil fuel suppliers and today’s consumers. He fails to recognize that this giveaway is borne by people today, who need clean air and oceans, and by future generations, who suffer from worsened climate.
The correct energy policy taxes fossil fuels according to their pollution costs. These taxes make prices reflect true costs and allow the market to determine the appropriate mix of sources. Yes, these taxes increase energy prices for consumers. But, crucially, when tax revenues are recycled equally, most households get more money back than the harm from higher energy prices.
That is how to make energy clean and affordable.