Subsidies for renewable and classic electricity

In the debate about wind and solar electricity, the amount of subsidies received by political decision is a hot topic. Usually the pushers of this type of electricity (correctly) insist that non-renewable electricity production is also subsidized, and that objecting subsidies for renewables is a moot point.

In this blog I will use concrete data available from the EIA, as well as a few illustrations from the “At the crossroads: Climate and Energy” meeting by the Texas Policy Foundation. All data refer to the USA, 2013.

Let us start with the EIA table which gives the different subsidies for the fiscal year 2013, in million of (2013) US$.

subsidies_USA2013_EIA

The “classical” electricity production by coal, natural gas, petroleum and nuclear receive 5081 million$, the renewables 15043 million$.

The next slide of a presentation by James M. Taylor from the Heartland Institute gives a good textual overview:

subsidies_EIAThe last point is especially instructive: coal, NG, petroleum and nuclear receive 5081 million$ as subsidies, but produce 86.6% of the total electricity; wind and solar receive 11264 million$ as subsidies and produce 4.4% ! This means that the wind & solar combined receive 43.6 times more subsidy per unit of electricity produced than the traditional producers!

If you just picture solar subsidies per 1000 MWh produced with the traditional producers, you get that nice pie-diagram (by Taylor):

subsidies_per_MWPer unit of electrical energy subsidies to traditional producers become nearly invisible compared to those of solar electricity!

The official EIA numbers in the table should close the debate: yes, renewables get really high subsidies for their very low overall contribution! The situation in Europe probably is similar to the USA, with renewable subsidies possibly still higher.

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