S.U.N. Report Solar Energy Blog

Does Solar Really Need Taxpayer Money?

Solar energy is currently the fastest growing domestic source of power in the US. And while the costs of power produced by non-renewable sources continues to rise, the rates for solar electricity have been steadily decreasing since 2009. This fact has led some pundits to criticize the solar tax incentives insisting the costs are passed down to consumers.

However, the truth is all forms of energy are subsidized. Oil, gas and coal get considerably more taxpayer dollars than solar or wind. Federal renewable energy subsidies, in the form of investment and tax credits, are a small fraction of the cumulative historical federal subsidies.

Even if you have no intention of looking into the benefits of solar electricity for your home, it is important to understand that fossil fuels receive four times the government subsidies than renewable energy. And that money comes from your pocket. In fact the average American pays $104.34 a year to subsidize Fossil Fuels compared to only $1.40 a year to support Renewable Energy.

Ben Schreiber, at Friends of the Earth US, defended subsidies for renewable energy: “Fossil fuels are a mature technology while renewable energy is nascent and still developing. It makes sense to subsidize technologies that are going to help solve climate change, but not to do the same for those that are causing the problem.”

All the same, new information shows that solar will survive without tax breaks and in fact will thrive. As a matter of fact, Bloomberg estimates that the loss of the tax credit will cause solar capacity to only quadruple, instead of quintuple by 2022, which is still a substantial increase. A Wall Street Journal analysis reinforces this assessment. In 22 states, at least 1 GW of solar (and often much more) could be installed at a comparable cost to retail electricity prices by 2017, tax credit not included.

Additionally, lowering costs and higher efficiency are giving renewable energy critics even less room to stand. Restoring defunct coal operations is often pitched by politicians as a way to restore lost jobs. However, in actuality, the solar industry alone is responsible for creating jobs at a rate seventeen times faster than the rest of the U.S. economy.


By Sharon Derby, Director of Marketing for Solar Energy World

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