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Renewable Energy and Addressing the Anti-subsidy Argument

Renewable energy suppliers and developers have often been the subject of criticism for receiving government subsidies that provide them with big tax breaks and credits.

Those who support the anti-subsidies argument against renewable energy typically believe that these government subsidies force tax- and ratepayers to support untenable renewable technology, and that energy suppliers and developers are simply using subsidies as a financial crutch.

The reality is that all forms of energy have received and continue to receive the support of subsidies.

A company that wants to successfully develop, site or manufacture renewable products, projects or energy must address this anti-subsidy misconception by making a clear, fact-based presentation of this complex issue to the community and other stakeholders. Tactics can include public meetings, town halls, special events, media relations, social media, coalition building and more.

The facts show that all forms of energy, including oil, gas and nuclear, have received some degree of government support in the beginning. Government subsidies have proven to be useful for helping emerging forms of energy production mature in the market.

According to a report covered by Chemical and Engineering News, this government support is most important during the first 15 years of an energy source’s adoption. Oil and gas and nuclear energy all received this federal support in their early days and continue to receive government support today.

Based on inflation-adjusted dollars, the C&EN report says that in their first 15 years of adoption, oil and gas received an average of $1.8 billion annually and nuclear energy received an average of $3.8 billion annually, while renewable energy received an average of a mere $400 million annually in federal support.

Since elements of the energy mix were developed at different times in the nation’s history and have been supported through different mechanisms, the financial support described in the C&EN report focuses on direct federal subsidies and does not take into account other factors, such as tax policy or state programs.

While renewables have not initially received nearly as much government support as oil, gas and nuclear, as described in the report, the fruits of government investment are paying off. According to a recent report from Lazard, the price of solar-generated electricity has dropped nearly 86% since 2009 and can now compete with other forms of energy production.

Utilities and renewable energy developers succeed when the communications, engineering, legal, regulatory, and government experts are all working together as a team — sharing information and ideas, participating in strategy development and partnering to execute a winning plan when addressing the anti-subsidy argument and other important issues with communities and other key stakeholders.

Mower has worked with clients throughout the Northeast and played a critical role in numerous successful renewable energy siting projects. Discover ways Mower has delivered a positive outcome for previous projects and can do the same for future siting projects.