David Kreutzer, Research Fellow in Energy Economics and Climate Change at The Heritage Foundation, tells Tyler Suiters that subsidizing clean energy industries won't lead to overall job growth.
Kreutzer says it's hard to tell where job growth will come from in the energy sector. He jobs are created in industries that produce products consumers want. He says when industries are subsidized, it means consumers aren't willing to pay the full price for a product, so those industries are not likely to create jobs. He says wind and solar power cost more than twice as much as electricity from coal or natural gas, so the only way to produce growth in the wind and solar industries is to tax other people, which is not good for the economy. He says wind and solar need subsidies to survive, while traditional fossil fuels can be competitive without subsidies.
Kreutzer believes a price on carbon will affect the mix of energy Americans use. He says it would take a huge price on carbon to drive coal out of the electric market, but it would ultimately drive down U.S. energy consumption. He says technology will eventually improve the cost of every source of energy. That will lead to entrepreneurs looking for the most inexpensive, reliable energy sources available. He says whatever that source turns out to be will wind up being the growth industry.
Kreutzer says jobs can be created in an industry with big enough subsidies, but they will come at the expense of jobs elsewhere.
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