Trump Is An Environmental Catastrophe
Trump claims to be a conservative, but calling for a bailout of the coal companies violates everything conservatives believe in, free markets.
The conservative philosophy of allowing an unregulated free market to operate unfettered often seems to fall by the wayside when the Republican Party’s industry allies are failing to compete in the marketplace. Trump’s Energy Secretary Rick Perry recently provided a stark example of this philosophical flexibility when he proposed to effectively pull the failing coal industry out of the marketplace and instead prop it up with taxpayer-funded subsidies.
However, Perry also made the mistake of referencing the 2014 Polar Vortex to try and support this argument. The cold temperatures associated with that weather pattern caused electricity demand to spike, but as experts have noted, while wind energy produced above expectations during the Polar Vortex, coal power failed
Perry’s argument is so ludicrous that it bears repeating. He claims that we need to subsidize huge coal piles to ensure grid resiliency to extreme events like the Polar Vortex. But during the Polar Vortex, coal plants were shut down because they couldn’t operate at such low temperatures, and because their big coal piles were frozen. And this isn’t the only example of grid resiliency without coal – during Hurricane Harvey, coal piles were too wet to be transported to power plant boilers. During record heat waves this summer, California’s grid proved reliable as a result of factors like renewables and energy storage, not coal.
Big Oil is also dependent on taxpayer subsidies
Along similar lines, a new study published in Nature Energy found that at current oil prices of $50 per barrel, about half of not-yet-developed oil fields are only profitable if the industry receives subsidies to pay for them. Worse yet, the oil industry pockets most taxpayer subsidy dollars in the form of profits:
Republicans and conservatives complained bitterly about Obama bailing out General Motors. They complained because a chapter 11 bankruptcy would have protected the stockholders while allowing GM to lay off workers without their pensions. Obama saved workers with the bailout. The bailout Trump wants is bailing out coal and oil company stockholders. Certainly not coal workers who aren't needed anymore because coal is now mined by simply plowing down mountains.At the price of US$50 per barrel, we find that a bit more than half (53%) of subsidy value (in net present value terms) goes to projects that would have proceeded anyway. That fraction rises to nearly all (98%) of subsidy value at US$100 per barrel. As others have found, regardless of the oil price, the majority of taxpayer resources provided to the industry end up as company profits.
As the Guardian reports, this is perverse. The survival of our civilization requires the opposite of a subsidy, a carbon tax, about which I've posted numerous times.