Bulgaria is the latest European country to take action in cutting rising electricity costs due to the over-subsidization of green energy. The Bulgarian parliament voted today to levy a 20 percent tax on income generated from green energy production.
It’s a solution to a problem familiar to Angela Merkel: in a bid to jumpstart renewables, Bulgaria guaranteed high prices for energy generated from solar panels and wind turbines. As Reuters reports, these government subsidies were vary effective in attracting investors:
Dozens of investors from Germany, Austria, the United States and South Korea have rushed to the Balkan country to take advantage of the subsidies. Their investment of more than 4 billion euros ($5.4 billion) has built 1,600 megawatts in wind and solar power installations.
But the program worked too well, and the costs are being passed along to consumers. That’s particularly troubling in Bulgaria, where the last administration capitulated earlier this year after widespread protests over rising power bills.
We’ve said it before, and we’ll say it again: Europe has proven itself completely incapable of finding the balance between green goals and growth. By propping up nascent green technologies incapable of competing on their own merit, Europe’s governments have saddled households and businesses alike with expensive energy. Today, Bulgaria moved to counteract these runaway subsidies; Germany is likely soon to follow.