THE TAX CODE PUNISHES EFFICIENT ENERGY SOURCES

The U.S. tax code is heavily weighted in favor of renewable power sources over conventional sources such as coal and oil, Tufts University economics professor Gilbert Metcalf reports in a new study released by the Manhattan Institute.

Under current law, solar thermal and wind capital are subsidized to the greatest extent, with effective subsidy rates of 245 and 164 percent, respectively. While renewable power sources receive substantial subsidies, more efficient conventional power sources are heavily punished by the tax code. [snip]

These numbers paint a clear picture: Renewable energy receives substantial federal subsidies while generating very small amounts of energy and usable electricity. In 2007, less than 1 percent of U.S. electricity was generated by wind energy, while coal contributed over half the nation's electricity that year.

"The tax code is biased toward politically correct energies at the expense of the energies consumers want most -- oil, natural gas, and coal," ... "To this extent, tax policy is anti-consumer."

Sterling Burnett, a senior fellow at the National Center for Policy Analysis, agrees federal policy punishes the most efficient energy sources.

"In a time of economic crisis, it is reprehensible that politicians continue to throw good money after bad and foist high-cost, low-output energy sources on consumers,"

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