As with so many other important and controversial subjects, the left has laid claim to climate change lock, stock and barrel, claiming that only massive government intervention in the form of new taxes, profligate spending and rampant regulation can address the underlying causes of global warming; and along the way environmentalism somehow morphs into socialism, despite the fact that these two particular “-isms” are manifestly unrelated. But it just isn’t true: conservatives have a wealth of ideas for addressing climate change that are in keeping with free market principles, as reflected in a new commentary in Forbes by Wayne Winegarden, a senior fellow with the Pacific Research Institute.
- One of the biggest obstacles to scaling alternative sources of energy like wind and solar is the fact that they are fundamentally “non-dispatchable,” Winegarden notes, meaning that unlike generation from fossil fuels they cannot be switched on and off at will: obviously solar only works when the sun is shining, wind when it’s windy. During downtimes the gap has to be filled by fossil fuel generation (and switching fossil fuel generation on and off imposes its own costs). Additionally, solar and wind generation often take place far from where electricity is in demand, without a robust transmission system to carry the power there.
- The way to tackle these obstacles is, at least in part, more innovation and better, more flexible distribution networks, Winegarden argues. Innovation can deliver new technologies allowing long-term battery storage for power from alternative sources, while upgrading and interconnecting the U.S. national power grid (still separated into two independent networks along the Rocky Mountains) would enable transmission of power from clean sources along much greater distances.
- How should we spur innovation and upgrades? Tax cuts have to be part of the answer: “One policy option would replace current technology-specific tax credits and subsidies with broad-based marginal tax rate reductions available for companies/investors that developed lower- or zero-emission technologies. These marginal tax rate reductions would increase the after-tax rate of return from investing in low- or zero-emission technologies, creating a strong positive incentive that would attract more investment and help alleviate the current technological constraints.”
- Winegarden also points to the need for regulatory reform around utilities, which still enjoy effective monopolies. Their monopoly power allows them to shut out power from alternative sources and denies consumers the benefits of choice and competition, including the right to choose power from alternative sources if they so desire. Opening utility networks to competition would help alternative sources scale up and bring energy prices down further, a “win-win” for the environment and consumers.
- Finally Winegarden echoes NJ Senator and presidential hopeful Cory Booker’s assertion that “nuclear has to be part of the blend,” writing: “Nuclear power is a carbon free, safe, and reliable power source that, with effective regulatory reforms, could be an important part of the solution.”