Anonymous
Anonymous asked in EnvironmentOther - Environment · 1 decade ago

Why would alternative energy companies need tax credits if their technology was superior?

Re: this Yahoo article:

http://news.yahoo.com/s/ap/20080831/ap_on_go_co/di...

It always amazes me that companies which have been developing alternative energy technologies for OVER 25 YEARS, with tax credits and other government subsidies to make them a low-cost technologically superior reality, continue to demand special breaks and considerations even though they STILL have not proven to deliver on their promise.

If I had created the ultimate alternative energy, lets say, a Mr. Fusion thing like in the fictional "Back to Future" series, which takes garbage or any other material, and it produces a waste by-product of water, and it only cost $1000 to manufacturer with a retail price well under a few thousand, there would be no need to get government subsidies because myself and my investors would be gazillionaires within 2 years!

The issue is, and remains, that every single alternative energy idea that we've been pursuing for the past 25 YEARS, including wind, solar, and ethanol, have not caught on because they are PROHIBITIVELY EXPENSIVE.

And the excuse is always, "Yeah, but we need more money to make it cheaper." Nonsense. If, after 25 YEARS, you still haven't figured out a way to improve the technology, IT'S A DEAD END.

This is because the alternative energy debate is fundamentally flawed. Every single alternative was missing, from the very beginning, the very essential element to make it practical and successful.

"Can we find an alternative energy resource that is less polluting, more abundant, and SIGNIFICANTLY AND SUBSTANTIALLY CHEAPER than existing resources?"

Consider PC technology. It was IMMEDIATELY substantially cheaper than its mainframe alternatives. This is why it took off as a computing power alternative. No government tax credits were needed. No subsidizing was required. Competitors popped up left and right to invest heavilly in making it better and better.

And in the same period of time that we have been pursuing these alternative energies, PC technology has evolved enormously.

And if we were still using computers with 256Kb of memory and floppy disks and dot matrix printers, and it turns out they were more expensive than mainframe computers, do you think ANYONE would be saying, "All IBM, Apple, Dell, HP, Intel and AMD need is more money from the government." ABSOLUTELY NOT.

Innovation is wonderful. But it has to be practical.

Any alternative energy source MUST be a substantially CHEAPER alternative FIRST and FOREMOST. Otherwise, we can throw trillions into the technology and it will never be accepted.

Private funding has already grown weary of the failures of these alternative energies to deliver on their promises.

Meanwhile, there are newer alternative energy ideas such as Fusion and Hydrogen that show great promise... but they are now in their infancy of development. In the meantime, we should take advantage of the cheaper resources we ALREADY have, and use those as a cost/value challenge for viable alternative energies.

Or should we continue to pursue and fund alternatives that no one will want to pay for?

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    Sorry, I cannot agree with you. Technology takes a long time to perfect.

    Also tax breaks are NOT subsidies. Subsidies are a big fat check the Government sends out. Tax breaks are being allowed to write off the cost (all, or partial) on ones taxes. I can write off the interest I pay on my mortgage, ever year on my taxes. Thank heavens their are ways to recieve tax breaks.

    Did you know Hoover Dam was built with huge funding from the Government (subsidies) and tax breaks. Do you believe the technology in Hoover Dam is "unproven" and doesn't work?

    Did you know the oil companies not only recieve TITANIC tax breaks from the Government, they also recieve TITANIC subsidies from the Government? Do you believe that oil and gas are unproven technologies? Or does your car do fairly well getting you from point A to point B? Perhaps you would feel better if the Government subsidies to the oil companies went away, so we in the U.S.A. could pay $10-$12 a gallon for our fuel, just as the Europeans are?

    There's another slight problem with your argument. Wind, & solar have not been worked on steadly for the past 25 years. Everyone was ga-ga for wind and solar in the 1970's during the first gas crunch. Then oil prices began to drop, and drop like a stone. Did you know that in the 1990's the U.S. could often purchase oil for $11 a barrel? Sometimes even cheaper. Oil and gas were so dirt cheap, there was no way to get funding to do research on wind and solar. Nobody saw any way that money put into researching wind and solar would ever be recovered.

    Now the second gas crunch is here, and people are screaming for wind and solar. Those technologies has improved by leapes and bounds. My husband works on the commercial wind turbines.

    There's an old wind farm they are upgrading to the new, modern wind turbines. There are over 600 old wind turbines at the wind farm. For every new, modern wind turbine they put up, they rip out NINTY of the old ones! One modern wind turbine has the same energy output as 90 of the older wind turbines. That's amazing! Imagine if our cars kept that kind of pace up! All cars would be getting a few hundred miles to the gallon.

    The problem with the "cheaper resources" is they are all based on some form of fossil fuel (except nukes). Fossil fuels WILL eventually run out. I'd much rather see investment, and infrastructure into alternative energies right now, instead of waiting until it's too late.

    ~Garnet

    Permaculture homesteading/farming over 20 years

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  • Anonymous
    1 decade ago

    Your argument fails from the start.

    Here's why. True, alternative energy research and development has been ongoing for decades. However, it takes that long--and longer--todevelop any new technology. And much of it is now cost-effective.

    Look at history. The railroads got government support for more than 50 years in the 19th century. Aircraft companies and airlines were subsidized by the government for over 30 years. Computer technology research was largely government funded from it's inception in the 1940s until the 1980s.

    Incidentally,neither fusion or hydrogen technology is "new"--they have been under research and development since the 1960s. And neither of those--unlike solar or wind power--is even closeto being commercially feasible.

    Also, you are incorrect in assuming that price alone is the criterion--again, lookat history. Automobiles were more exxpensive to start with than horses. Air travel was--and still is-the most expensiveform of long distance transportation. If a new technology offers collateral benefits that offset equal or higher costs, it will be viable. Price is NOT the only parameter you have to consider. If it were--every car we have would already be electric--it's cheaper to build and operate and has been for 40 years. It hasn't become the standard not because of cost, but because until recently, electrics didn't have the range and power that consumers want (they do now).

    Finally, you say"private funding has grown weary" of alternative energy. Here, you are simply incorrect. Here's some hard numbers: in 2006 private entrepreneurs invested $1.5 billion in research and new capital plant in alternative enrgy--JUST in "Silicon Valley" (the Palo Alto high-tech concentration in CA. In $2007 the figure rose to $3.5 billion. So far this year, its on track to exceed that figure--despite the economic woes we're having. Entrepreneurs and venture capitalists are flocking to alternative energy technologies.

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  • 1 decade ago

    We're actually giving substantial tax credits to the oil industry just like the agricultural industry is getting subsidies, another well established industry. For decades, oil companies haven't had to pay their fair share of corporate income tax, and it shows in their lobbying clout. I agree with you, though, that alternative energy should get off its proverbial butt and give us something we can actually use on a large scale. But here's the point, so much of what has been developed is actually useful. The main problem is that nobody politcally wants to commit to anything. The vested interests (oil companies) have been fighting alternative energy tooth and nail, thwarting attempts of any one technology to gain a foothold. Did you know that the battery powered electric car was invented about 160 years ago, but that the car manufacturers together with the oil companies schemed to make it disappear? The same with light rail initiatives, which may not seem to be energy related, but it is of course because light rail uses electricity.

    The amount of labor that's involved in producing oil and maintaining cars that run on it is so much more substantial than the painless electric car. Many more people stand to gain by promoting the polluting alternative. We are in fact keeping a dinosaur alive that should have been sent to the scrap heap a long time ago. Then again, the damage to people's health from having to breathe exhaust gases is a boon for the healthcare industry, another lobbying effort. I am not going as far as to say they would actually promote people getting sick, but they sure make a nice buck from the treatment of respiratory illnesses and associated cancers.

    I am puzzled by your argument for the PC. By lowering the initial pricepoint everybody thought Microsoft Windows was a much better alternative than Apple's pricier offerings. Nobody except the real bean counters thought about calculating total cost of ownership over a certain accounting period, typically a calendar year, which historically showed the Macintosh to be 40% cheaper than the PC thanks to all the hours spent fixing Bill Gates's and associates' stupendously flawed offerings. If our politicians and the GAO would have done the same with established vs alternative energy sources, they would have put the oil company executives in jail for perjury a long time ago.

    Back to alternative energy, doesn't it blow your mind that the sun produces a virtually limitless amount of energy for us to use every day? If we were really politically committed to using it, we would have given the solar cell manufacturers the same resources we gave to the railroads and oil companies when they were trying to establish themselves. The momentum appears to be finally there though. The electric car is now a certainty, solar panels, hydrogen solutions and other solutions are much more efficient now than they were just a few years ago. Alternative energy will soon be mainstream.

    There is one alternative energy solution that has been around for a while and that has gotten the same kind of resistance as the rest that needs mentioning: converting garbage back into oil and minerals. It's called thermal depolymerization and it would actually give us the oil back that we need to make plastics. If you consider how much waste goes into landfills every year (a huge energy drain on the economy), you could see how this solution could also free us from the solid waste that we create, not just the stuff that we pump into the atmosphere. I believe we need to look at the energy picture from a wholistic perspective and tackle the issue from every possible angle. Hope this helps, and thanks for raising the subject!

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  • 5 years ago

    I never imagined that it was possible to get Free Electricity. I have seen a lot of products offering ways to save on electricity or get free power and I have tried most of them. To my dismay, they are all useless and I just wasted my money trying them. When I saw Power Innovator, I remembered that if someone would have created a Free Energy Device, it would have been Prof Richard Goran the genius that invented the electricity.

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  • NLBNLB
    Lv 6
    1 decade ago

    Nuclear power subsidies in R&D since the 50's: over 50 billion

    Yearly subsidies on oil and gas in the US: 10 to 30 billion

    Military spendings to keep the international oil flows safe: 20 to 80 billion per year

    Cumulative subsidies for renewable in all the history of the US? Less than 30 billion in 2007

    What thou you say now?

    Source(s): I won't write a huge email but my guess is that you have NEVER heard of learning ratios... google it. FYI: The PJ of useful energy created by wind is cheaper than with gas and this without subsidies... why don't you make the calculation yourself? I can only laugh at your comparison with PCs... the energy sector has typically investments over a lifetime of 40 years... perhaps even 60 for some nuclear power plants... in turn, safety of investment is preferred to the innovation and performance and locks the sector into "business as usual" Had we not payed for unuseful things like theoretical research and programs which were not customer oriented like the Appolo Program, a lot of inventions which are in your everyday life would not have been possible. BTW: IT is not a dead end as solar power is for example really on track to become cost-competitive. Even Pres Bush who is the best example of the "renewable energy non friendly person" has admitted it will be at grid parity in 2015. You know, Columbus sailors also argued he did not deliver his promises... that didn't stop him and he was right.
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  • 3 years ago

    No, it is not hypocritical. the only way vast company is going to be greater skill effective is that if there's a financial incentive to realize this. until government starts affecting their base line, there is not any clarification for any vast company to analyze or change over to option skill components. working example, what if the gov. did away with payroll taxes for great company and rather taxed them on how plenty pollutants they produced each and each 12 months? by using becoming greater "green", a company could decrease the quantity of taxes it paid and enhance revenue.

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  • Anonymous
    1 decade ago

    "Any alternative energy source MUST be a substantially CHEAPER alternative FIRST and FOREMOST."

    Cheaper than what? Sulfer-laden coal?

    Why do you think its odd to have to pay more (at least right now) for something that is BETTER (environmentally) than what we are doing now? In what world (aside from microchip development) do we expect something new to be both better and cheaper? Medicine? No. Agriculture? No. Education? No.

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