The Luxury of Renewables

Green energy isn’t cheap energy, and government programs put in place to help get wind and solar off the ground are drawing the ire of advocacy groups concerned that poor households share none of the programs’ benefits and a disproportionate amount of their costs. Reuters reports:

[Green subsidy schemes] come with certain credit requirements and are ill-suited for apartment dwellers, homes with low monthly bills or low-income households that qualify for reduced power rates. […]

In Arizona, the solar industry’s growth has slowed since 2013, when regulators approved a fee for solar customers after the state utility argued that lower-income and minority communities were left burdened with grid maintenance costs.

Solar power advocates say its share is too small to have any impact on costs faced by conventional energy consumers, but the setback made them work harder to win over minority communities.

Some groups have even taken to calling owning solar panels another example of white privilege. 73 percent of one online solar seller’s customers identified themselves as white, while just 4 percent identified themselves as black. As Reuters remarks, “[s]ince minorities make up a disproportionate number of low-income households, some advocacy groups have opposed certain solar power initiatives arguing that they deepen social and racial inequality.”

This isn’t a trivial point. Consider the example of Germany, which has recklessly pursued the development of wind and solar power by guaranteeing producers long-term above-market rates. The costs of these feed-in tariffs, as they’re called, are inevitably borne by consumers in the form of a green surcharge on electricity bills. If you’re wealthy, you might not notice the resulting spike in your monthly bill, but for lower-income households this can make a real, unwelcome difference. In that respect, it’s a form of regressive taxation.

The current crop of solar panels can’t compete with fossil fuels on its own merits, which is why state and federal governments have to step in with subsidies to help prop it up. These subsidies don’t just divert money away from the research and development of breakthroughs that could actually allow renewables to float on their own. They also cost consumers—the poor chief among them.

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