When Alternative Energy Subsidies End . . .

Jim Panyard from the PA Independent reports on Rep. Scavello’s plan to secure $26 to $54 million in stimulus funding for residents who own Thermal Storage Unit heating systems.

The systems were popular in the 1980’s and have been highly subsidized ($182 million over a 30 year period) by other PPL rate payers. With the expiration of rate caps and the subsidies TSU owners are complaining of skyrocketing electricity bills.

This is a perfect example of why subsidies for alternative or new energy technologies are bad economic policy. Eventually the subsidies expire, and when they do some crusading politician will try to justify spending taxpayer funds to bail them out. If Scavello succeeds you can be sure more bailouts of consumers who made energy decisions based on manipulated price signals will follow.