Alternative Energy Subsidies Far Exceed Fossil Fuel Subsidies

One of the primary objections to alternative fuels is that they are not viable unless heavily subsidized. Not so fast, say the environmentalists- you have to take into account the subsidies that are provided to fossil fuels in order to make a fair comparison.

The Breakthrough Institute recently did some calculations and learned that subsidies for alternative fuels far exceed those provided to fossil fuels.  The subsidies are twice as great worldwide (due primarily to governments that subsidize fuel supplies for their citizens) and are 7 times greater in the United States.  Here's what they came up with globally:

• Fossil energy:
  • Total subsidies (2009) = $312 billion;
  • Share of global energy consumption provided (2009) = 83 percent;
  • Subsidy per percentage of global energy consumption provided: $3.8 billion
• Renewable energy: 
• Total subsidies (2009) = $57 billion;
  Share of global energy consumption provided (2009) = 7 percent;
• Subsidy per percentage of global energy consumption provided: $8.1 billion (Note: excludes conventional hydropower and biomass)
• Compared on a per unit of energy provided basis, renewables therefore receive 2.1x more government subsidies than fossil fuels.
• Data source: International Energy Agency

Here's what it looked like in the US:

• Fossil energy:
  • Total subsidies (2002-2008, cumulative): $72.4 billion;
  • Share of U.S. energy consumption provided (2008): 84.6 percent;
  • Subsidy per percentage of U.S. energy consumption provided: $0.9 billion.
• Renewable energy:
  • Total subsidies (2002-2008, cumulative): $28.9 billion;
  • Share of U.S. energy consumption provided (2008): 4.3 percent;
  • Subsidy per percentage of U.S. energy consumption provided: $6.7 billion. (Note: excludes conventional hydropower)
• Compared on a per unit of energy provided basis, renewables therefore receive 7.4x more U.S. federal subsidies than fossil fuels.
• Data source: subsidies for Environmental Law Institute, energy cosumption from U.S. Energy Information Administration, "Annual Energy Outlook 2010." Note that subsidy figures are cumulative for the seven years from 2002 to 2008. The per unit subsidy figures for the U.S. should therefore not be strictly compared to the global figures above.