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Policy
Recommendation: Tax
the indirect costs of each energy type to reflect their true costs.
The chart at the right shows that the "True Cost" of each energy technology is very different from their current "Direct Costs". Coal appears to be the cheapest, but when all of its externalities are included, it is nearly twice the cost of wind energy. However, the market is not reflecting these true costs. (Note there is approx. 50% uncertainty in these calculations). Looking ahead to 2050, it is predicted that wind and solar will get much cheaper, while coal and nuclear will remain unchanged, and natural gas will increase. |
| Metrics
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| Coal | ||
| Natural Gas |
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| Nuclear |
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| Wind |
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| Solar |
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| Policy! |
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| Policy Specifics | Considerations | |
| Taxing the indirect costs will achieve
two goals: 1) Reflect the true market cost of energy technologies 2) Raise money for the federal government to pay for their indirect costs, help low-income consumers during the transition to new energy technology, and fund alternative energy development. Alternative Energy Technology R&D should be funded for Solar, Wind, and any other revolutionary technologies (nuclear fusion, biomass, etc) that share the following characteristics: 1) There is significant innovation potential to reduce the cost per unit of energy 2) R&D is prohibitively expensive for the free market to invest in. There will be no "silver bullet" that will solve all of our energy problems; the solution will involve a combination of the above. |
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