In Tuesday’s MDJ, Gas South CEO Kevin Greiner lauded the value of tax credits for businesses that spend money on alternative fuel vehicles. In other news, defense contractors lauded the value of $4,000 toilets.
Energy Boss Greiner attempted to justify his pending largesse with evidence only a politician would believe. “The goal is to create meaningful incentives for companies to upgrade their fleets and put more low-emission vehicles on our state’s roads and highways.” Yet, as Greiner readily promotes, ample incentives already exist. “Compressed natural gas (CNG) is the most popular alternative fuel for commercial fleets, as it is widely available and significantly less expensive than gasoline or diesel — about $1.50 to $2 less per gallon.”
Better yet, corporations are already acting on these incentives. “The savings can be substantial. DeKalb County, which recently converted its sanitation fleet to use CNG, estimates it will save $3 million over an eight-year period. Atlanta-based UPS is able to keep its shipping rates low by fueling delivery trucks with CNG.” In other words, market prices already provide ample incentives for businesses to convert to alternative fuels, and many are taking advantage of current conditions.
The advantages Greiner promotes are already in effect, so why exactly do we need taxpayers to subsidize this market?
Greiner falsely paints the debate as one between business and environmentalists, and lauds recent legislation for benefiting both. In reality, the debate is between taxpayers and big business. Perhaps Greiner is familiar with the Reason Foundation study which found “the companies that spent the most on lobbying received the biggest” subsidies, which explains his perverse logic.
Energy subsidies are among the most wasteful government programs. Not only do they make zero economic sense, but ample evidence exists of their negative effects on corporations such as Solyndra. Pete Geddes of the Foundation for Research on Economics and the Environment notes “(w)hen we subsidize things that trade in the market, we benefit the well off and well organized at the expense of the most vulnerable members of society.”
It is difficult to blame Greiner for ignoring economics in an effort to benefit his company and himself. Yet some energy CEOs are honest. David Bergeron, founder and president of Sundance, a solar energy company dependent on NASA contracts has made the definitive case against the very subsidies Greiner lauds; “Subsidies defeat market forces on both sides of the equation. They reduce potential supply by hindering entrepreneurs from developing new energy supplies, and they increase demand by artificially keeping the price of energy down. There could hardly be a more cleverly disguised means of exacerbating a potential climate issue.”
Greiner’s “investments” are anything but. Historically they lose money. Worse, they are involuntary. In a different context, they would correctly be called theft.